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Published: 2021-04-22 00:00:00 ET
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EX-99.1 2 chco03-31x21exhibit991.htm EX-99.1, PRESS RELEASE CHCO 1Q2021 EARNINGS Document











NEWS RELEASE

For Immediate Release
            April 21, 2021

For Further Information Contact:
Charles R. Hageboeck, Chief Executive Officer and President
(304) 769-1102

City Holding Company Announces Quarterly Results

Charleston, West Virginia – City Holding Company (“Company” or “City”) (NASDAQ:CHCO), a $5.9 billion bank holding company headquartered in Charleston, West Virginia, today announced quarterly net income of $19.8 million and diluted earnings of $1.25 per share for the quarter ended March 31, 2021.

Charles R. (“Skip”) Hageboeck, the President and Chief Executive Officer of City Holding Company, commented: “Our country and the communities that we serve are emerging from the COVID-19 pandemic and it is encouraging to see economic activity returning to more “normal” conditions. However, the impacts of this crisis continued to impact our financial performance during the first quarter of 2021. Our reported net interest income dipped $0.7 million from the linked quarter ended December 31, 2020 and our net interest margin dropped 8 basis points to 2.91%. Deposit balances continue to grow primarily as a result of the third round of stimulus payments with average deposit balances increasing over $150 million from the quarter ended December 31, 2020. City continues to participate in the government-sponsored Paycheck Protection Program (“PPP”) loans administered by the Small Business Administration (“SBA”). Thus far, City has assisted customers in obtaining almost $40 million in new PPP loans during the second round.”

“A hallmark for City over the last several years has been our asset quality. Our asset quality remains very strong at March 31, 2021. Nonperforming assets, past due loans, and troubled debt restructurings remain at or below the levels reported at December 31, 2020. Deferred commercial loans remained relatively low at approximately 6% of total commercial balances at March 31, 2021. Hotel and lodging related loans comprise $105 million of the $115 million of these deferrals at March 31, 2021, and our hotel and lodging loan customers are experiencing increasing occupancy rates. Residential mortgage deferrals have dropped to approximately $3 million at March 31, 2021.”

“Loan growth has been a particular challenge with interest rates at historic lows. Although our residential mortgage origination levels hit record highs in 2020, balances have decreased as some mortgages were refinanced into fixed rate loans not predominately offered by City. Those trends continued in the first quarter of 2021, but we believe that as mortgage rates and fees charged by agencies increase, our


mortgage balances will increase. The decline in commercial loans primarily reflects a seasonal customer, as well as pricing pressure from some competitors. As the economy continues to improve, our view is that commercial loans will regain positive momentum.”

Net Interest Income

The Company’s net interest income decreased from $38.2 million during the fourth quarter of 2020 to $37.5 million during the first quarter of 2021. The Company’s tax equivalent net interest income decreased $0.6 million, or 1.7%, from $38.5 million for the fourth quarter of 2020 to $37.9 million for the first quarter of 2021. Lower loan yields (2 basis points) and lower average loan balances ($50 million) decreased interest income by $0.7 million and $0.5 million, respectively, as compared to the quarter ended December 31, 2020. In addition, lower average investment balances ($30 million) decreased interest income by $0.2 million from the quarter ended December 31, 2020. These decreases were partially offset by lower rates paid on interest-bearing liabilities (primarily time deposits) that lowered interest expense by $0.9 million during the quarter ended March 31, 2021. The Company’s reported net interest margin decreased from 2.99% for the fourth quarter of 2020 to 2.91% for the first quarter of 2021.

Balance Sheet Trends

Loans decreased $75.4 million from December 31, 2020 to March 31, 2021, to $3.55 billion. Net of forgiveness received from the SBA of approximately $32 million of PPP loans from the first round, PPP loans increased $7.4 million as a result of the Company’s participation in the second round of the PPP lending. Excluding outstanding PPP loans (included in the commercial and industrial loan category), total loans decreased $82.8 million, (2.3%), from December 31, 2020 to $3.48 billion at March 31, 2021. Residential real estate loans decreased $54.8 million (3.5%); commercial real estate loans decreased $12.1 million (0.8%); commercial and industrial loans decreased $9.2 million (2.9%) (excluding PPP loans); and home equity loans decreased $6.5 million (4.7%).

Total average depository balances increased $152.5 million, or 3.4%, from the quarter ended December 31, 2020 to the quarter ended March 31, 2021. Average noninterest-bearing demand deposit balances increased $67.8 million, average savings deposit balances increased $72.5 million, and average interest-bearing demand deposit balances increased $54.7 million. These balances increased despite low average interest rates paid by the Company – 5 basis points for interest-bearing deposits and 6 basis points for savings deposits. We believe that these increases were largely attributable to the third round of Economic Impact Payments as part of the Coronavirus Response and Relief Supplemental Appropriations Act of 2021 (approximately $180 million). These increases were partially offset by lower average time deposit balances of $42.5 million.

Credit Quality

The Company’s ratio of nonperforming assets to total loans and other real estate owned increased modestly from 0.38% at December 31, 2020 to 0.39% at March 31, 2021. Total nonperforming assets increased slightly from $13.9 million at December 31, 2020 to $14.0 million at March 31, 2021. Total past due loans decreased from $8.9 million, or 0.25% of total loans outstanding, at December 31, 2020 to $6.6 million, or 0.19% of total loans outstanding, at March 31, 2021.

As a result of the Company’s quarterly analysis of the adequacy of the allowance for credit losses (“ACL”), the Company recorded a recovery of credit losses of $0.4 million in the first quarter of 2021, compared to a provision for credit losses of $8.0 million for the comparable period in 2020 and a


provision for credit losses of $0.5 million for the fourth quarter of 2020. The recovery of credit losses recorded in the first quarter of 2021 largely reflects the decline in loan balances ($83 million) from the quarter ended December 31, 2020 which resulted in the release of $0.5 million from the allowance for credit losses during the first quarter of 2021. As a result of an improvement in economic conditions in the Company’s footprint, net charge-offs for the quarter ended March 31, 2021 were negligible.

Non-interest Income

During the quarter ended March 31, 2020, the Company sold the entirety of its Visa Inc. Class B common shares (86,605) in a cash transaction which resulted in a pre-tax gain of $17.8 million, or $0.84 diluted per share on an after-tax basis. Additionally, the Company reported $0.1 million of unrealized fair value losses on the Company’s equity securities during the first quarter of 2021 compared to $2.4 million of unrealized fair value losses on the Company’s equity securities during the first quarter of 2020. The Company’s portfolio of equity securities consists primarily of holdings in First National Corporation (“FXNC”) (a commercial banking company headquartered in Strasburg, VA) and Eagle Financial Services (a commercial banking company headquartered in Berryville, VA). In the first quarter of 2021, the Company sold shares of FXNC and realized a gain of $0.3 million. Exclusive of these items, non-interest income decreased from $17.9 million for the first quarter of 2020 to $16.4 million for the first quarter of 2021. This decrease was largely attributable to a decrease of $1.8 million, or 23.9%, in service charges. In addition, other income, primarily due to lower fees from loan interest rate swap originations, decreased $0.7 million. These decreases were partially offset by higher bankcard revenues ($1.1 million, or 21.5%) compared to the quarter ended March 31, 2020. Bankcard revenue of $6.2 million in the quarter ended March 31, 2021, represents the highest quarterly total in the Company’s history as spending by our customers increased significantly in the month of March.
Non-interest Expenses

Non-interest expenses increased $0.3 million, or 1.2%, from $29.5 million in the first quarter of 2020 to $29.8 million in the first quarter of 2021. FDIC insurance expense increased $0.4 million from the quarter ended March 31, 2020 due to credits utilized in the first quarter of 2020.
Income Tax Expense

The Company’s effective income tax rate for the first quarter of 2021 was 20.1% compared to 19.5% for the year ended December 31, 2020, and 20.2% for the quarter ended March 31, 2020.

Capitalization and Liquidity

The Company’s loan to deposit ratio was 73.9% and the loan to asset ratio was 60.2% at March 31, 2021. The Company maintained investment securities totaling 20.6% of assets as of the same date. The Company’s deposit mix is weighted heavily toward checking and saving accounts, which fund 60.9% of assets at March 31, 2021. Time deposits fund 20.5% of assets at March 31, 2021, but very few of these deposits are in accounts that have balances of more than $250,000, reflecting the core retail orientation of the Company.

The Company continues to be strongly capitalized with tangible equity of $573 million at March 31, 2021. Due primarily to the influx of deposits and unrealized security losses during the quarter ended March 31, 2021, the Company’s tangible equity ratio decreased modestly from 10.3% at December 31, 2020 to 9.9% at March 31, 2021. At March 31, 2021, City National Bank’s Leverage Ratio was 8.91%, its Common


Equity Tier I ratio was 14.75%, its Tier I Capital ratio was 14.75%, and its Total Risk-Based Capital ratio was 15.33%. These regulatory capital ratios are significantly above levels required to be considered “well capitalized,” which is the highest possible regulatory designation.

On March 31, 2021, the Board of Directors of the Company approved a quarterly cash dividend of $0.58 per share payable April 30, 2021, to shareholders of record as of April 15, 2021. On March 31, 2021, the Company announced that the Board of Directors authorized the Company to buy back up to 1,000,000 shares of its common stock (approximately 6% of outstanding shares) in open market transactions at prices that are accretive to the earnings per share of continuing shareholders. No time limit was placed on the duration of the share repurchase program. As part of this authorization, the Company terminated its previous repurchase program that was approved in February 2019. The Company had repurchased 908,701 shares under the 2019 program. During the quarter ended March 31, 2021, the Company repurchased 75,000 common shares at a weighted average price of $76.71 per share as part of a one million share repurchase plan authorized by the Board of Directors in February 2019. As of March 31, 2021, the Company could repurchase 1,000,000 additional shares under the current program.

City Holding Company is the parent company of City National Bank of West Virginia. City National Bank operates 94 branches across West Virginia, Kentucky, Virginia, and Ohio.

Forward-Looking Information

This news release contains certain forward-looking statements that are included pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements express only management’s beliefs regarding future results or events and are subject to inherent uncertainty, risks, and changes in circumstances, many of which are outside of management’s control. Uncertainty, risks, changes in circumstances and other factors could cause the Company’s actual results to differ materially from those projected in the forward-looking statements. Factors that could cause actual results to differ from those discussed in such forward-looking statements include, but are not limited to those set forth in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2020 under “ITEM 1A Risk Factors” and the following: (1) general economic conditions, especially in the communities and markets in which we conduct our business; (2) the uncertainties on the Company’s business, results of operations and financial condition, caused by the COVID-19 pandemic, which will depend on several factors, including the scope and duration of the pandemic, its continued influence on financial markets, the effectiveness of the Company’s work from home arrangements and staffing levels in operational facilities, the impact of market participants on which the Company relies and actions taken by governmental authorities and other third parties in response to the pandemic; (3) credit risk, including risk that negative credit quality trends may lead to a deterioration of asset quality, risk that our allowance for loan losses may not be sufficient to absorb actual losses in our loan portfolio, and risk from concentrations in our loan portfolio; (4) changes in the real estate market, including the value of collateral securing portions of our loan portfolio; (5) changes in the interest rate environment; (6) operational risk, including cybersecurity risk and risk of fraud, data processing system failures, and network breaches; (7) changes in technology and increased competition, including competition from non-bank financial institutions; (8) changes in consumer preferences, spending and borrowing habits, demand for our products and services, and customers’ performance and creditworthiness; (9) difficulty growing loan and deposit balances; (10) our ability to effectively execute our business plan, including with respect to future acquisitions; (11) changes in regulations, laws, taxes, government policies, monetary policies and accounting policies affecting bank holding companies and their subsidiaries; (12) deterioration in the financial condition of the U.S. banking system may impact the valuations of investments the Company has made in the securities of other financial institutions; (13) regulatory enforcement actions and adverse


legal actions; (14) difficulty attracting and retaining key employees; (15) other economic, competitive, technological, operational, governmental, regulatory, and market factors affecting our operations. Forward-looking statements made herein reflect management's expectations as of the date such statements are made. Such information is provided to assist stockholders and potential investors in understanding current and anticipated financial operations of the Company and is included pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The Company undertakes no obligation to update any forward-looking statement to reflect events or circumstances that arise after the date such statements are made. Further, the Company is required to evaluate subsequent events through the filing of its March 31, 2021 Form 10-Q. The Company will continue to evaluate the impact of any subsequent events on the preliminary March 31, 2021 results and will adjust the amounts if necessary.






CITY HOLDING COMPANY AND SUBSIDIARIES
Financial Highlights
(Unaudited)
Three Months Ended
March 31,December 31,September 30,June 30,March 31,
20212020202020202020
Earnings
Net Interest Income (FTE)$37,871 $38,514 $38,278 $38,287 $40,603 
Net Income available to common shareholders19,814 22,222 20,126 18,251 29,000 
Per Share Data
Earnings per share available to common shareholders:
   Basic$1.25 $1.4 $1.25 $1.12 $1.79 
   Diluted1.25 1.4 1.25 1.12 1.78 
Weighted average number of shares (in thousands):
   Basic15,656 15,708 15,950 16,081 16,080 
   Diluted15,687 15,733 15,970 16,097 16,101 
Period-end number of shares (in thousands)15,724 15,768 15,848 16,077 16,140 
Cash dividends declared$0.58 $0.58 $0.57 $0.57 $0.57 
Book value per share (period-end)43.99 44.47 43.62 43.15 42.45 
Tangible book value per share (period-end)36.47 36.94 36.11 35.72 35.03 
Market data:
   High closing price$87.41 $70.77 $67.98 $71.19 $82.40 
   Low closing price69.05 56.98 55.37 55.18 57.11 
   Period-end closing price81.78 69.55 57.61 65.17 66.53 
   Average daily volume (in thousands)63 56 67 89 69 
Treasury share activity:
      Treasury shares repurchased (in thousands)75 81 231 79 182 
      Average treasury share repurchase price
$76.71 $60.32 $59.49 $61.75 $71.31 
Key Ratios (percent)
Return on average assets1.38 %1.59 %1.46 %1.35 %2.29 %
Return on average tangible equity13.5 %15.3 %13.8 %12.6 %20.6 %
Yield on interest earning assets3.17 %3.32 %3.43 %3.64 %4.22 %
Cost of interest bearing liabilities0.37 %0.47 %0.58 %0.71 %0.91 %
Net Interest Margin2.91 %2.99 %3.02 %3.13 %3.54 %
Non-interest income as a percent of total revenue30.4 %30.7 %30.3 %27.4 %30.6 %
Efficiency Ratio54.3 %51.0 %51.6 %53.3 %49.7 %
Price/Earnings Ratio (a)16.30 12.41 11.53 14.50 17.63 


Capital (period-end)
Average Shareholders' Equity to Average Assets12.30 %12.46 %12.71 %12.91 %13.50 %
Tangible equity to tangible assets9.93 %10.33 %10.61 %10.62 %11.38 %
Consolidated City Holding Company risk based capital ratios (b):
   CET I16.76 %16.18 %15.93 %16.10 %16.02 %
   Tier I16.76 %16.18 %15.93 %16.10 %16.02 %
   Total17.33 %16.75 %16.50 %16.69 %16.46 %
   Leverage10.06 %10.22 %10.19 %10.45 %11.10 %
City National Bank risk based capital ratios (b):
   CET I14.75 %14.10 %14.46 %14.55 %14.32 %
   Tier I14.75 %14.10 %14.46 %14.55 %14.32 %
   Total15.33 %14.68 %15.04 %15.15 %14.82 %
   Leverage8.91 %8.97 %9.32 %9.29 %9.98 %
Other (period-end)
Branches94 94 94 94 95 
FTE916 926 925 911 922 
   Assets per FTE (in thousands)$6,434 $6,219 $5,984 $6,058 $5,525 
   Deposits per FTE (in thousands)5,236 5,024 4,799 4,834 4,400 
(a) The price/earnings ratio is computed based on annualized quarterly earnings (excludes gain for sale of VISA shares, net of taxes).
(b) March 31, 2021 risk-based capital ratios are estimated.




CITY HOLDING COMPANY AND SUBSIDIARIES
Consolidated Statements of Income
(Unaudited) ($ in 000s, except per share data)
Three Months Ended
March 31,December 31,September 30,June 30,March 31,
20212020202020202020
Interest Income
   Interest and fees on loans$34,324 $35,685 $35,761 $37,718 $41,335 
   Interest on investment securities:
     Taxable5,242 5,500 6,266 5,718 5,871 
     Tax-exempt1,253 1,254 1,132 821 707 
   Interest on deposits in depository institutions
118 60 72 55 304 
Total Interest Income40,937 42,499 43,231 44,312 48,217 
Interest Expense
   Interest on deposits3,280 4,198 5,123 5,963 7,238 
   Interest on short-term borrowings
117 120 131 279 464 
   Interest on long-term debt— — — — 100 
Total Interest Expense3,397 4,318 5,254 6,242 7,802 
Net Interest Income37,540 38,181 37,977 38,070 40,415 
(Recovery of) provision for credit losses(440)474 1,026 1,250 7,972 
Net Interest Income After (Recovery of) Provision for Credit Losses37,980 37,707 36,951 36,820 32,443 
Non-Interest Income
Net gains (losses) on sale of investment securities283 6 — (6)63 
Unrealized (losses) gains recognized on equity securities still held(51)835 461 242 (2,402)
   Service charges5,881 6,771 6,295 4,945 7,723 
   Bankcard revenue6,213 5,991 6,065 5,888 5,115 
   Trust and investment management fee income
2,033 2,162 1,844 1,931 1,799 
   Bank owned life insurance1,460 813 1,088 848 1,676 
   Sale of VISA shares— — — — 17,837 
   Other income811 1,143 1,232 783 1,536 
Total Non-Interest Income16,630 17,721 16,985 14,631 33,347 
Non-Interest Expense
   Salaries and employee benefits15,671 15,989 15,361 14,873 15,851 
   Occupancy related expense2,622 2,447 2,428 2,402 2,488 
   Equipment and software related expense
2,544 2,660 2,607 2,504 2,429 
   FDIC insurance expense405 363 355 167 — 
   Advertising881 538 462 933 843 
   Bankcard expenses1,584 1,443 1,517 1,498 1,435 
   Postage, delivery, and statement mailings
592 546 513 592 616 
   Office supplies392 413 396 353 394 
   Legal and professional fees675 438 548 589 601 


   Telecommunications690 540 547 531 511 
   Repossessed asset losses (gains), net of expenses
79 (68)39 76 198 
   Other expenses3,674 3,332 3,939 3,950 4,102 
Total Non-Interest Expense29,809 28,641 28,712 28,468 29,468 
Income Before Income Taxes24,801 26,787 25,224 22,983 36,322 
   Income tax expense4,987 4,565 5,098 4,732 7,322 
Net Income Available to Common Shareholders$19,814 $22,222 $20,126 $18,251 $29,000 
Distributed earnings allocated to common shareholders$9,037 $9,053 $8,944 $9,073 $9,117 
Undistributed earnings allocated to common shareholders10,598 12,947 10,984 8,998 19,620 
Net earnings allocated to common shareholders$19,635 $22,000 $19,928 $18,071 $28,737 
Average common shares outstanding15,656 15,708 15,950 16,081 16,080 
Shares for diluted earnings per share15,687 15,733 15,970 16,097 16,101 
Basic earnings per common share$1.25 $1.40 $1.25 $1.12 $1.79 
Diluted earnings per common share$1.25 $1.40 $1.25 $1.12 $1.78 



CITY HOLDING COMPANY AND SUBSIDIARIES
Consolidated Balance Sheets
($ in 000s)
(Unaudited)(Unaudited)(Unaudited)(Unaudited)
March 31,December 31,September 30,June 30,March 31,
20212020202020202020
Assets
Cash and due from banks$97,709 $77,412 $76,451 $87,658 $92,365 
Interest-bearing deposits in depository institutions659,090 451,247 176,267 285,596 18,271 
Cash and cash equivalents756,799 528,659 252,718 373,254 110,636 
Investment securities available-for-sale, at fair value1,185,245 1,178,789 1,157,399 1,055,185 934,113 
Other securities27,182 27,372 26,548 26,144 26,827 
Total investment securities1,212,427 1,206,161 1,183,947 1,081,329 960,940 
Gross loans3,546,723 3,622,119 3,663,966 3,665,596 3,613,050 
Allowance for credit losses(24,076)(24,549)(24,867)(25,199)(24,393)
Net loans3,522,647 3,597,570 3,639,099 3,640,397 3,588,657 
Bank owned life insurance118,976 118,243 117,501 116,746 116,000 
Premises and equipment, net76,529 76,925 77,031 77,991 78,948 
Accrued interest receivable16,231 15,793 16,627 14,200 12,570 
Net deferred tax assets1,395 — — — 2,159 
Intangible assets118,224 118,592 119,004 119,417 119,829 
Other assets71,142 96,697 105,361 105,438 98,710 
Total Assets$5,894,370 $5,758,640 $5,511,288 $5,528,772 $5,088,449 
Liabilities
Deposits:
   Noninterest-bearing$1,244,175 $1,176,990 $1,061,310 $1,079,469 $857,501 
   Interest-bearing:
   Demand deposits1,077,749 1,027,201 940,791 921,761 837,966 
   Savings deposits1,265,038 1,188,003 1,117,684 1,067,254 989,609 
   Time deposits1,209,873 1,260,022 1,300,291 1,342,631 1,366,977 
Total deposits4,796,835 4,652,216 4,420,076 4,411,115 4,052,053 
Short-term borrowings
   Federal Funds purchased— — — — 9,900 
   Customer repurchase agreements316,003 295,956 279,866 282,676 224,247 
Net deferred tax liabilities— 3,202 1,601 2,598 — 
Other liabilities89,847 106,160 118,386 138,633 117,021 
Total Liabilities5,202,685 5,057,534 4,819,929 4,835,022 4,403,221 


Stockholders' Equity
Preferred stock— — — — — 
Common stock47,619 47,619 47,619 47,619 47,619 
Capital surplus170,526 171,304 170,526 169,881 170,096 
Retained earnings600,396 589,988 576,901 565,804 556,718 
Cost of common stock in treasury(142,484)(139,038)(134,177)(120,583)(116,665)
Accumulated other comprehensive income:
Unrealized gain on securities available-for-sale
21,289 36,894 36,760 37,299 33,730 
Underfunded pension liability
(5,661)(5,661)(6,270)(6,270)(6,270)
Total Accumulated Other Comprehensive Income15,628 31,233 30,490 31,029 27,460 
Total Stockholders' Equity691,685 701,106 691,359 693,750 685,228 
Total Liabilities and Stockholders' Equity$5,894,370 $5,758,640 $5,511,288 $5,528,772 $5,088,449 
Regulatory Capital
Total CET 1 capital$563,523 $557,641 $548,269 $548,972 $547,040 
Total tier 1 capital563,523 557,641 548,269 548,972 547,040 
Total risk-based capital582,816 577,292 568,153 569,213 561,944 
Total risk-weighted assets3,362,595 3,446,774 3,442,629 3,410,589 3,412,591 




CITY HOLDING COMPANY AND SUBSIDIARIES
Loan Portfolio
(Unaudited) ($ in 000s)
March 31,December 31,September 30,June 30,March 31,
20212020202020202020
Commercial and industrial$371,195 $372,989 $383,980 $369,122 $308,567 
1-4 Family108,131 109,812 114,071 123,814 120,852 
Hotels293,176 294,464 295,989 295,179 294,072 
Multi-family212,561 215,671 214,394 204,580 205,684 
Non Residential Non-Owner Occupied649,683 641,351 628,814 628,628 627,852 
Non Residential Owner Occupied199,130 213,484 211,433 215,472 222,489 
Commercial real estate (1)
1,462,681 1,474,782 1,464,701 1,467,673 1,470,949 
Residential real estate (2)
1,532,907 1,587,694 1,621,265 1,631,151 1,629,578 
Home equity130,009 136,469 140,135 142,672 146,034 
Consumer47,224 47,688 50,541 52,278 54,749 
DDA Overdrafts2,707 2,497 3,344 2,700 3,173 
Gross Loans$3,546,723 $3,622,119 $3,663,966 $3,665,596 $3,613,050 
Construction loans included in:
(1) - Commercial real estate loans$39,101 $40,449 $42,449 $42,092 $44,453 
(2) - Residential real estate loans22,129 27,078 28,947 28,252 28,870 



CITY HOLDING COMPANY AND SUBSIDIARIES
Asset Quality Information
(Unaudited) ($ in 000s)

Three Months Ended
March 31,December 31,September 30,June 30,March 31,
20212020202020202020
Allowance for Credit Losses
Balance at beginning of period$24,549 $24,867 $25,199 $24,393 $11,589 
Charge-offs:
Commercial and industrial(34)(9)(757)— (77)
Commercial real estate(1)(616)(75)(39)(383)
Residential real estate(93)(139)(252)(376)(483)
Home equity(64)(88)(126)(161)(45)
Consumer(147)(27)(74)(36)(55)
DDA overdrafts(453)(629)(554)(459)(703)
Total charge-offs(792)(1,508)(1,838)(1,071)(1,746)
Recoveries:
Commercial and industrial46 74 3 5 9 
Commercial real estate164 150 44 128 203 
Residential real estate74 57 24 8 95 
Home equity23 47 33 9 47 
Consumer39 55 42 128 13 
DDA overdrafts413 333 334 349 451 
Total recoveries759 716 480 627 818 
Net charge-offs(33)(792)(1,358)(444)(928)
(Recovery of) provision for credit losses(440)474 1,026 1,250 7,972 
Impact of adopting ASC 326— — — — 5,760 
Balance at end of period$24,076 $24,549 $24,867 $25,199 $24,393 
Loans outstanding$3,546,723 $3,622,119 $3,663,966 $3,665,596 $3,613,050 
Allowance as a percent of loans outstanding0.68 %0.68 %0.68 %0.69 %0.68 %
Allowance as a percent of non-performing loans194.5 %200.7 %182.7 %185.1 %202.2 %
Average loans outstanding$3,585,790 $3,635,673 $3,661,569 $3,660,174 $3,608,868 
Net charge-offs (annualized) as a percent of average loans outstanding— %0.09 %0.15 %0.05 %0.10 %






CITY HOLDING COMPANY AND SUBSIDIARIES
Asset Quality Information, Continued
(Unaudited) ($ in 000s)
March 31,December 31,September 30,June 30,March 31,
20212020202020202020
Nonaccrual Loans
Residential real estate$3,004 $2,968 $3,983 $3,477 $2,750 
Home equity88 95 74 265 249 
Commercial and industrial1,200 768 728 1,087 1,175 
Commercial real estate7,792 8,401 8,479 8,715 7,865 
Consumer— — — — 1 
   Total nonaccrual loans12,084 12,232 13,264 13,544 12,040 
Accruing loans past due 90 days or more295 — 345 68 26 
   Total non-performing loans12,379 12,232 13,609 13,612 12,066 
Other real estate owned1,625 1,650 2,080 3,997 3,922 
   Total non-performing assets$14,004 $13,882 $15,689 $17,609 $15,988 
Non-performing assets as a percent of loans and other real estate owned0.39 %0.38 %0.43 %0.48 %0.44 %
Past Due Loans
Residential real estate$4,092 $5,993 $5,153 $5,261 $7,815 
Home equity449 575 474 393 430 
Commercial and industrial1,358 1,241 691 160 71 
Commercial real estate508 625 602 917 1,021 
Consumer10 113 121 67 177 
DDA overdrafts212 341 379 273 467 
   Total past due loans$6,629 $8,888 $7,420 $7,071 $9,981 
Total past due loans as a percent of loans outstanding0.19 %0.25 %0.20 %0.19 %0.28 %
Troubled Debt Restructurings ("TDRs")
   Residential real estate$18,572 $19,226 $20,398 $20,631 $21,413 
   Home equity1,956 2,001 2,100 2,138 2,294 
   Commercial and industrial— — — — — 
   Commercial real estate4,615 4,638 4,894 4,915 5,163 
   Consumer211 277 260 185 184 
     Total TDRs$25,354 $26,142 $27,652 $27,869 $29,054 





CITY HOLDING COMPANY AND SUBSIDIARIES
Consolidated Average Balance Sheets, Yields, and Rates
(Unaudited) ($ in 000s)

Three Months Ended
March 31, 2021December 31, 2020March 31, 2020
AverageYield/AverageYield/AverageYield/
BalanceInterestRateBalanceInterestRateBalanceInterestRate
Assets:
Loan portfolio (1):
Residential real estate (2)
$1,696,064 $16,853 4.03 %$1,744,952 $17,623 4.02 %$1,780,473 $19,881 4.49 %
Commercial, financial, and agriculture (2)
1,838,928 16,542 3.65 %1,837,044 17,077 3.70 %1,770,178 20,476 4.65 %
Installment loans to individuals (2), (3)
50,798 713 5.69 %53,677 800 5.93 %58,217 863 5.96 %
Previously securitized loans (4)
 *** 215  ***  *** 184  ***  *** 115  ***
Total loans3,585,790 34,323 3.88 %3,635,673 35,684 3.90 %3,608,868 41,335 4.61 %
Securities:   
Taxable945,177 5,242 2.25 %976,897 5,500 2.24 %810,766 5,871 2.91 %
Tax-exempt (5)
239,589 1,585 2.68 %238,198 1,587 2.65 %94,591 895 3.81 %
Total securities1,184,766 6,827 2.34 %1,215,095 7,087 2.32 %905,357 6,766 3.01 %
Deposits in depository institutions513,469 118 0.09 %275,106 60 0.09 %102,932 304 1.19 %
Total interest-earning assets5,284,025 41,268 3.17 %5,125,874 42,831 3.32 %4,617,157 48,405 4.22 %
Cash and due from banks79,683 73,900 70,763 
Premises and equipment, net76,837 76,956 77,368 
Goodwill and intangible assets118,453 118,855 120,091 
Other assets217,453 231,309 195,875 
Less: Allowance for credit losses(24,909)(25,112)(15,905)
       Total assets$5,751,542 $5,601,782 $5,065,349 
Liabilities:
Interest-bearing demand deposits$1,008,283 $124 0.05 %$953,604 $171 0.07 %$869,976 $468 0.22 %
Savings deposits1,221,169 183 0.06 %1,148,717 225 0.08 %1,005,829 700 0.28 %
Time deposits (2)
1,236,197 2,973 0.98 %1,278,698 3,801 1.18 %1,365,268 6,070 1.79 %
Short-term borrowings290,766 117 0.16 %287,059 120 0.17 %209,010 464 0.89 %
Long-term debt— — — %— — — %3,340 100 12.04 %
   Total interest-bearing liabilities3,756,415 3,397 0.37 %3,668,078 4,317 0.47 %3,453,423 7,802 0.91 %
Noninterest-bearing demand deposits1,197,910 1,130,084 852,384 
Other liabilities89,695  105,445  75,922  
Stockholders' equity707,522 698,175 683,620 
Total liabilities and
stockholders' equity$5,751,542 $5,601,782 $5,065,349 
Net interest income$37,871 $38,514 $40,603 
Net yield on earning assets2.91 %2.99 %3.54 %
(1) For purposes of this table, non-accruing loans have been included in average balances and the following amounts (in thousands) of net loan fees have been included in interest income:
Loan fees, net$835 $962 $116 


(2) Included in the above table are the following amounts (in thousands) for the accretion of the fair value adjustments related to the Company's acquisitions:
Residential real estate$106 $153 $151 
Commercial, financial, and agriculture325 304 1,240 
Installment loans to individuals28 29 39 
Time deposits48 155 155 
$507 $641 $1,585 
(3) Includes the Company’s consumer and DDA overdrafts loan categories.
(4) Effective January 1, 2012, the carrying value of the Company's previously securitized loans was reduced to $0.
(5) Computed on a fully federal tax-equivalent basis assuming a tax rate of approximately 21%.



CITY HOLDING COMPANY AND SUBSIDIARIES
Non-GAAP Reconciliations
(Unaudited) ($ in 000s, except per share data)
Three Months Ended
March 31,December 31,September 30,June 30,March 31,
20212020202020202020
Net Interest Income/Margin
Net interest income ("GAAP")$37,540 $38,181 $37,977 $38,070 $40,415 
Taxable equivalent adjustment331 333 301 217 188 
Net interest income, fully taxable equivalent
$37,871 $38,514 $38,278 $38,287 $40,603 
Average interest earning assets$5,284,025 $5,125,874 $5,047,868 $4,914,242 $4,617,157 
Net Interest Margin2.91 %2.99 %3.02 %3.13 %3.54 %
Accretion related to fair value adjustments(0.04)%(0.05)%(0.05)%(0.08)%(0.14)%
Net Interest Margin (excluding accretion)
2.87 %2.94 %2.97 %3.05 %3.40 %
Tangible Equity Ratio (period end)
Equity to assets ("GAAP")11.74 %12.18 %12.54 %12.55 %13.47 %
Effect of goodwill and other intangibles, net(1.81)%(1.85)%(1.93)%(1.93)%(2.09)%
Tangible common equity to tangible assets
9.93 %10.33 %10.61 %10.62 %11.38 %
Return on Tangible Equity
Return on tangible equity ("GAAP")13.5 %15.3 %13.8 %12.6 %20.6 %
Impact of sale of VISA shares— %— %— %— %(9.7)%
Return on tangible equity, excluding sale of VISA shares13.5 %15.3 %13.8 %12.6 %10.9 %
Return on Assets
Return on assets ("GAAP")1.38 %1.59 %1.46 %1.35 %2.29 %
Impact of sale of VISA shares— %— %— %— %(1.08)%
Return on assets, excluding merger sale of VISA shares1.38 %1.59 %1.46 %1.35 %1.21 %