Associated Banc-Corp's first-quarter 2014 earnings surpassed the
Zacks Consensus Estimate. Improvement in net interest income (NII)
and prudish expense management were the positives for the quarter.
However, these were partially offset by a fall in non-interest
income and higher provisions. Further, while capital ratios
deteriorated, profitability ratios and credit quality were a mixed
bag. Nonetheless, we expect capital ratios to stabilize, given the
gradual recovery in the economy. Also, enhanced capital deployment
activities will reinstate investors' confidence in the stock.
However, considerable exposure to commercial loans, continuous rise
in operating expenses and concentration risks arising from limited
geographic diversification keep us apprehensive.
Associated Banc-Corp founded in 1964 is headquartered in Green
Bay, WI. This bank holding company, through its subsidiaries
Associated Bank, National Association and various non-banking
subsidiaries, provides an array of banking and non-banking products
and services to individuals and businesses. It has approximately
200 banking offices serving more than 100 communities, primarily
within the 3-state branch footprint Wisconsin, Illinois and
Minnesota. As of Mar 31, 2014, the company had approximately 4,517
Associated Banc-Corp operates through the following three
Commercial Banking: The segment offers loans, deposits, and
related banking services to businesses, which primarily include
business checking and other business deposit products, business
loans, lines of credit, commercial real estate financing,
construction loans, letters of credit and revolving credit
arrangements. It also includes insurance related products and
services, business credit cards, equipment and machinery leases,
and the support to deliver, fund and manage such banking
Consumer Banking: The segment consists of lending and deposit
gathering to individuals and small businesses and also provides a
variety of fiduciary, investment management, advisory and corporate
agency services to assist customers in building, investing or
protecting their wealth, including securities brokerage and trust /
asset management. The segment offers a variety of loan and deposit
products to retail customers.
Risk Management and Shared Services: The segment includes
Corporate Risk Management, Finance, Treasury, Facilities
Management, Operations and Technology functions. The earning assets
within this segment include the company's investment portfolio and
capital includes both allocated as well as any remaining
As of Mar 31, 2014, Associated Banc-Corp had $24.8 billion in
total assets, $623.4 million in cash and cash equivalents, $16.4
billion in total loans, $17.5 billion in total deposits and $2.9
billion in stockholders' equity.
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