CITY HOLDING CO - Annual Report: 2009 (Form 10-K)
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D. C. 20549
FORM
10-K
[X]
Annual Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of
1934
For the
fiscal year ended December 31, 2009
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 0-11733
CITY
HOLDING COMPANY
(Exact
Name of Registrant as Specified in its Charter)
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West
Virginia
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55-0619957
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(State
or Other Jurisdiction of
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(I.R.S.
Employer
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Incorporation
or Organization)
25
Gatewater Road, Cross Lanes, WV
(Address
of Principal Executive Offices)
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Identification
No.)
25313
(Zip
Code)
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304-769-1100
(Registrant’s
Telephone Number, Including Area Code)
Securities
registered pursuant to Section 12(b) of the Act:
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Title
of Each Class
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Name
of Each Exchange on Which Registered:
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|
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None
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None
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Securities
registered pursuant to Section 12(g) of the Act:
Common
Stock, $2.50 par value
(Title of
class)
Indicate
by check mark if the registrant is a well-known seasoned issuer, as defined in
Rule 405 of the Securities Act. [ ] Yes [X]
No
Indicate
by check mark if the registrant is not required to file reports pursuant to
Section 13 or 15(d) of the Act. [ ] Yes [X]
No
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. [X] Yes [ ] No
Indicate
by check mark whether the registrant has submitted electronically and posted on
its corporate Website, if any, every Interactive Data File required to be
submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this
chapter) during the preceding 12 months (or for such shorter period that the
registrant was required to submit and post such files). [ ]
Yes [X] No
-1-
Indicate
by check mark if disclosure of delinquent filers pursuant to Item 405 of
Regulation S-K (§229.405 of this chapter) is not contained herein, and will not
be contained, to the best of registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-K
or any amendment to this Form 10-K. [ ]
Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, or a non-accelerated filer. See definition of
“large accelerated filer,” “accelerated filer” and “smaller reporting company”
in Rule 12b-2 of the Exchange Act. (Check one):
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Large
accelerated filer [ ]
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Accelerated
filer [X]
|
|
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Non-accelerated
filer [ ] (Do not check if a smaller reporting
company)
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Smaller
reporting company
[ ]
|
Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Act).
[ ]
Yes [X] No
-2-
As of
June 30, 2009, the last business day of the registrant’s most recently completed
second quarter, the aggregate market value of the shares of common stock held by
non-affiliates, based upon the closing price per share of the registrant’s
common stock as reported on the Nasdaq National Market System, was approximately
$470.4 million. (Registrant has assumed that all of its executive
officers and directors are affiliates. Such assumption shall not be
deemed to be conclusive for any other purpose.)
As of
March 26, 2010, there were 15,812,855 shares of the Company’s common stock,
$2.50 par value, outstanding.
DOCUMENTS
INCORPORATED BY REFERENCE
Portions
of the annual report to security holders for the fiscal year ended December 31,
2009 are incorporated by reference into Part I, Item 1 and Part II, Items 6, 7,
7A, and 8. Portions of the Proxy Statement for the 2010 annual shareholders’
meeting to be held on April 28, 2010 are incorporated by reference into Part
III, Items 10, 11, 12, 13, and 14.
-3-
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FORM
10-K INDEX
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PART
I
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Pages
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Item
1.
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Business
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4-11
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Item
1A.
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Risk
Factors
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12-16
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Item
1B.
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Unresolved
Staff Comments
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17
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Item
2.
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Properties
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17
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Item
3.
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Legal
Proceedings
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17
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Item
4.
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Submission
of Matters to a Vote of Security Holders
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17
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PART
II
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Item
5.
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Market
for Registrant’s Common Equity, Related Stockholder Matters and Issuer
Purchases of Equity Securities
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18-20
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Item
6.
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Selected
Financial Data
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20
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Item
7.
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Management’s
Discussion and Analysis of Financial Condition and Results of
Operations
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20
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Item
7A.
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Quantitative
and Qualitative Disclosures About Market Risk
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21
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Item
8.
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Financial
Statements and Supplementary Data
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21
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Item
9.
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Changes
in and Disagreements With Accountants on Accounting and Financial
Disclosure
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21
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Item
9A.
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Controls
and Procedures
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21
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Item
9B.
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Other
Information
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21
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Part
III
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Item
10.
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Directors,
Executive Officers and Corporate Governance
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21-22
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Item
11.
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Executive
Compensation
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22
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Item
12.
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Security
Ownership of Certain Beneficial Owners and Management and Related
Stockholder Matters
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22
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Item
13.
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Certain
Relationships and Related Transactions, and Director
Independence
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22
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Item
14.
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Principal
Accounting Fees and Services
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22
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Part
IV
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Item
15.
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Exhibits,
Financial Statement Schedules
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23
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Signatures
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24-26
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Exhibit Index
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27-29
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-4-
PART
I
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Item
1.
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Business
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City
Holding Company (the “Company”) is a bank holding company headquartered in
Charleston, West Virginia. The Company conducts its principal activities through
its wholly-owned subsidiary, City National Bank of West Virginia (“City
National”). Through its network of 67 banking offices in West Virginia (56
offices), Kentucky (8 offices), and Ohio (3 offices), City National provides
credit, deposit, trust and investment management, and insurance products and
services to its customers. In addition to its branch network, City National’s
delivery channels include ATMs, check cards, interactive voice response systems,
and internet technology. City National has approximately 7% of the deposit
market share in West Virginia and the Company is the third largest bank holding
company headquartered in West Virginia based on deposit share. The Company’s
business activities are currently limited to one reportable business segment,
which is community banking.
No
portion of City National’s deposits are derived from a single person or persons,
the loss of which could have a material adverse effect on liquidity, capital, or
other elements of financial performance. Although no portion of City National’s
loan portfolio is concentrated within a single industry or group of related
industries, it historically has held residential mortgage loans as a significant
portion of its loan portfolio. At December 31, 2009, 56% of the Company’s loan
portfolio was categorized as residential mortgage and home equity loans.
However, due to the fractionated nature of residential mortgage lending, there
is no concentration of credits that would be considered materially detrimental
to the Company’s financial position or operating results.
The
Company’s business is not seasonal and has no foreign sources or applications of
funds. There are no anticipated material capital expenditures, or any
expected material effects on earnings or the Company’s competitive position as a
result of compliance with federal, state and local provisions enacted or adopted
relating to environmental protection.
The
Company’s loan portfolio is comprised of commercial, residential real estate,
home equity, consumer loans and previously securitized loans.
The
commercial loan portfolio consists of loans to corporate borrowers primarily in
small to mid-size industrial and commercial companies, as well as automobile
dealers, service, retail and wholesale merchants. Collateral securing these
loans includes equipment, machinery, inventory, receivables, vehicles and
commercial real estate. Commercial loans are considered to contain a higher
level of risk than other loan types although care is taken to minimize these
risks. Numerous risk factors impact this portfolio including industry specific
risks such as economy, new technology, labor rates and cyclicality, as well as
customer specific factors, such as cash flow, financial structure, operating
controls and asset quality. Included in commercial loans are
commercial real estate loans. Commercial real estate loans consist of
commercial mortgages, which generally are secured by nonresidential and
multi-family residential properties, including hotel/motel and apartment
lending. Commercial real estate loans are to many of the same customers and
carry similar industry risks as the commercial loans. The Company diversifies
risk within this portfolio by closely monitoring industry concentrations and
portfolios to ensure that it does not exceed established lending guidelines.
Diversification is intended to limit the risk of loss from any single unexpected
economic event or trend. Underwriting standards require a comprehensive credit
analysis and independent evaluation of virtually all larger balance commercial
loans by the loan committee prior to approval. As of December 31,
2009, the Company reported $752.1 million of loans classified as
“Commercial.”
Residential
mortgage loans represent loans to consumers for the purchase or refinance of a
residence. These loans are generally financed over a 15- to 30- year term, and
in most cases, are extended to borrowers to finance their primary residence. In
some cases, government agencies or private mortgage insurers guarantee the loan.
The Company sells a significant majority of our fixed-rate originations in the
secondary market. As of December 31, 2009, the Company reported
$595.7 million of loans classified as “Residential Real Estate.”
Home
equity lending includes both home equity loans and lines-of-credit. This type of
lending, which is secured by a first- or second- mortgage on the borrower’s
residence, allows customers to borrow against the equity in their home. Real
estate market values as of the time the loan or line is granted directly affect
the amount of credit extended. As of December 31, 2009, the Company
reported $398.8 million of loans classified as “Home Equity.”
-5-
Consumer
loans are secured by automobiles, boats, recreational vehicles, and other
personal property. The Company monitors the risk associated with these types of
loans by monitoring such factors as portfolio growth, lending policies and
economic conditions. Underwriting standards are continually evaluated and
modified based upon these factors. As of December 31, 2009, the Company reported
$44.2 million of loans classified as “Consumer.”
Previously
Securitized Loans were recorded as a result of the Company’s early redemption of
the outstanding notes attributable to the Company’s six loan securitization
trusts. As the outstanding notes were redeemed during 2004 and 2003, the Company
became the beneficial owner of the remaining mortgage loans and recorded the
carrying amount of those loans within the loan portfolio, classified as
“previously securitized loans.” These loans are junior lien mortgage loans on
one- to four-family residential properties located throughout the United States.
The loans generally have contractual terms of 25 or 30 years and have fixed
interest rates. The Company expects this balance to continue to decline as
borrowers remit principal payments on the loans. As of December 31,
2009, the Company reported $1.7 million of loans classified as “Previously
Securitized loans.”
The
Company’s loan underwriting guidelines and standards are updated periodically
and are presented for approval by the Board of Directors. The purpose of the
standards and guidelines is to grant loans on a sound and collectible basis; to
invest available funds in a safe, profitable manner; to serve the legitimate
credit needs of the communities in our primary market area; and to ensure that
all loan applicants receive fair and equal treatment in the lending process. It
is the intent of the underwriting guidelines and standards to: minimize loan
losses by carefully investigating the credit history of each applicant, verify
the source of repayment and the ability of the applicant to repay, collateralize
those loans in which collateral is deemed to be required, exercise care in the
documentation of the application, review, approval, and origination process, and
administer a comprehensive loan collection program. The above guidelines are
adhered to and subject to the experience, background and personal judgment of
the loan officer assigned to the loan application.
The
Company categorizes these commercial loans by industry according to the North
American Industry Classification System (NAICS) to monitor the portfolio for
possible concentrations in one or more industries. As of December 31, 2009, the
Company has no industry classifications that exceeded 10% of total
loans.
Market
Area
As of
December 2009, West Virginia’s unemployment rate was 8.6% as compared to the
national average of 10.0% according to the Workforce West
Virginia. West Virginia’s unemployment rate for December of 8.6%
increased from November’s rate of 7.9% and December 2008’s rate of
4.4%. According to the U.S. Census Bureau estimates, West Virginia’s
population was approximately 1.8 million as of July 2009 and has increased 0.2%
annually over the last 4 years. The median home price in the
Charleston, WV metropolitan area for both 2009 and 2008 was $127,000, while the
number of home sales increased 12.3% for the quarter ended December 31, 2009 as
compared to the quarter ended September 30, 2009, according to the National
Association of Realtors.
Competition
As noted
previously, the Company’s principal markets are located in West Virginia. The
majority of the Company’s banking offices are located in the areas of
Charleston, Huntington, Beckley and Martinsburg where there is a significant
presence of other financial service providers. In its markets, the Company
competes with national, regional, and local community banks for deposit, credit,
trust and investment management, and insurance customers. In addition to
traditional banking organizations, the Company competes with credit unions,
finance companies, insurance companies and other financial service providers who
are able to provide specialty financial services to targeted customer groups. As
further discussed below, changes in laws and regulations enacted in recent years
have increased the competitive environment the Company faces to retain and
attract customers.
-6-
Regulation
and Supervision
Overview: The Company, as a
registered bank holding company, and City National, as an insured depository
institution, operate in a highly regulated environment and are regularly
examined by federal and state regulators. The following description briefly
discusses certain provisions of federal and state laws and regulations and the
potential impact of such provisions to which the Company and City National are
subject. These federal and state laws and regulations are designed to
reduce potential loss exposure to the depositors of such depository institutions
and to the Federal Deposit Insurance Corporation’s insurance fund and are not
intended to protect the Company’s security holders. Proposals to change the laws
and regulations governing the banking industry are frequently raised in
Congress, in state legislatures, and before the various bank regulatory
agencies. The likelihood and timing of any changes and the impact
such changes might have on the Company are impossible to determine with any
certainty. A change in applicable laws or regulations, or a change in
the way such laws or regulations are interpreted by regulatory agencies or
courts, may have a material impact on the business, operations and earnings of
the Company. To the extent that the following information describes
statutory or regulatory provisions, it is qualified entirely by reference to the
particular statutory or regulatory provision.
As a bank
holding company, the Company is regulated under the Bank Holding Company Act of
1956, as amended (the “BHCA”), and is subject to inspection, examination and
supervision by the Board of Governors of the Federal Reserve Board. The BHCA
provides generally for “umbrella” regulation of bank holding companies such as
the Company by the Federal Reserve Board, and for functional regulation of
banking activities by bank regulators, securities activities by securities
regulators, and insurance activities by insurance regulators. The Company is
also under the jurisdiction of the Securities and Exchange Commission (“SEC”)
and is subject to the disclosure and regulatory requirements of the Securities
Act of 1933, as amended, and the Securities Exchange Act of 1934, as amended, as
administered by the SEC. the Company is listed on the Nasdaq Stock Market, Inc.
(NASDAQ) under the trading symbol “CHCO,” and is subject to the rules of the
NASDAQ for listed companies.
City
National is organized as a national banking association under the National Bank
Act. It is subject to regulation and examination by the Office of the
Comptroller of the Currency (“OCC”) and the Federal Deposit Insurance
Corporation (“FDIC”).
In
general, the BHCA limits the business of bank holding companies to banking,
managing or controlling banks and other activities that the Federal Reserve
Board has determined to be so closely related to banking as to be a proper
incident thereto. Under the BHCA, bank holding companies that qualify and elect
to be financial holding companies may engage in any activity, or acquire and
retain the shares of a company engaged in any activity, that is either (i)
financial in nature or incidental to such financial activity (as determined by
the Federal Reserve Board in consultation with the OCC) or (ii) complementary to
a financial activity and does not pose a substantial risk to the safety and
soundness of depository institutions or the financial system generally (as
solely determined by the Federal Reserve Board). Activities that are financial
in nature include securities underwriting and dealing, insurance underwriting
and making merchant banking investments.
The BHC
Act generally limits acquisitions by bank holding companies that are not
qualified as financial holding companies to commercial banks and companies
engaged in activities that the Federal Reserve Board has determined to be so
closely related to banking as to be a proper incident thereto. The Federal
Reserve Board has the power to order any bank holding company or its
subsidiaries to terminate any activity or to terminate its ownership or control
of any subsidiary when the Federal Reserve Board has reasonable grounds to
believe that continuation of such activity or such ownership or control
constitutes a serious risk to the financial soundness, safety or stability of
any bank subsidiary of the bank holding company.
The
Riegle-Neal Interstate Banking and Branching Efficiency Act of 1994
(“Riegle-Neal”) permits bank holding companies to acquire banks located in any
state. Riegle-Neal also allows national banks and state banks with different
home states to merge across state lines and allows branch banking across state
lines, unless specifically prohibited by state laws.
-7-
The
International Money Laundering Abatement and Anti-Terrorist Financing Act of
2001 (USA “Patriot Act”) was adopted in response to the September 11, 2001
terrorist attacks. The Patriot Act provides law enforcement with
greater powers to investigate terrorism and prevent future terrorist
acts. Among the broad-reaching provisions contained in the Patriot
Act are several designed to deter terrorists’ ability to launder money in the
United States and provide law enforcement with additional powers to investigate
how terrorists and terrorist organizations are financed. The Patriot
Act creates additional requirements for banks, which were already subject to
similar regulations. The Patriot Act authorizes the Secretary of
Treasury to require financial institutions to take certain “special measures”
when the Secretary suspects that certain transactions or accounts are related to
money laundering. These special measures may be ordered when the
Secretary suspects that a jurisdiction outside of the United States, a financial
institution operating outside of the United States, a class of transactions
involving a jurisdiction outside of the United States or certain types of
accounts are of “primary money laundering concern.” The special
measures include the following: (a) require financial institutions to
keep records and report on transactions or accounts at issue; (b) require
financial institutions to obtain and retain information related to the
beneficial ownership of any account opened or maintained by foreign persons; (c)
require financial institutions to identify each customer who is permitted to use
a payable-through or correspondent account and obtain certain information from
each customer permitted to use the account; and (d) prohibit or impose
conditions on the opening or maintaining of correspondent or payable-through
accounts. Failure of a financial institution to maintain and
implement adequate programs to combat money laundering and terrorist financing,
or to comply with all of the relevant laws or regulations, could have serious
legal and reputational consequences for the institution.
The
Community Reinvestment Act of 1977 (“CRA”) requires depository institutions to
assist in meeting the credit needs of their market areas consistent with safe
and sound banking practice. Under the CRA, each depository institution is
required to help meet the credit needs of its market areas by, among other
things, providing credit to low- and moderate-income individuals and
communities. Depository institutions are periodically examined for compliance
with the CRA and are assigned ratings. In order for a financial holding company
to commence any new activity permitted by the BHCA, or to acquire any company
engaged in any new activity permitted by the BHCA, each insured depository
institution subsidiary of the financial holding company must have received a
rating of at least “satisfactory” in its most recent examination under the CRA.
Furthermore, banking regulators take into account CRA ratings when considering
approval of a proposed transaction.
Capital Adequacy: Federal
banking regulations set forth capital adequacy guidelines, which are used by
regulatory authorities to assess the adequacy of capital in examining and
supervising a bank holding company and its insured depository institutions. The
capital adequacy guidelines generally require bank holding companies to maintain
total capital equal to at least 8% of total risk-adjusted assets, with at least
one-half of total capital consisting of core capital (i.e., Tier I capital) and
the remaining amount consisting of “other” capital-eligible items (i.e., Tier II
capital), such as perpetual preferred stock, certain subordinated debt, and,
subject to limitations, the allowance for loan losses. Tier I capital generally
includes common stockholders’ equity plus, within certain limitations, perpetual
preferred stock and trust preferred securities. For purposes of computing
risk-based capital ratios, bank holding companies must meet specific capital
guidelines that involve quantitative measures of assets, liabilities and certain
off-balance sheet items, calculated under regulatory accounting practices. The
Company’s and City National’s capital amounts and classifications are also
subject to qualitative judgments by the regulators about components, risk
weightings, and other factors.
In
addition to total and Tier I capital requirements, regulatory authorities also
require bank holding companies and insured depository institutions to maintain a
minimum leverage capital ratio of 3%. The leverage ratio is determined as the
ratio of Tier I capital to total average assets, where average assets exclude
goodwill, other intangibles, and other specifically excluded assets. Regulatory
authorities have stated that minimum capital ratios are adequate for those
institutions that are operationally and financially sound, experiencing solid
earnings, have high levels of asset quality, and are not experiencing
significant growth. The guidelines also provide that banking organizations
experiencing internal growth or making acquisitions will be expected to maintain
strong capital positions substantially above the minimum supervisory levels. In
those instances where these criteria are not evident, regulatory authorities
expect, and may require, bank holding companies and insured depository
institutions to maintain higher than minimum capital levels.
-8-
Additionally,
federal banking laws require regulatory authorities to take “prompt corrective
action” with respect to depository institutions that do not satisfy minimum
capital requirements. The extent of these powers depends upon whether the
institutions in question are “well capitalized”, “adequately capitalized”,
“undercapitalized”, “significantly undercapitalized” or “critically
undercapitalized”, as such terms are defined under uniform regulations defining
such capital levels issued by each of the federal banking agencies. As an
example, a depository institution that is not well capitalized is generally
prohibited from accepting brokered deposits and offering interest rates on
deposits higher than the prevailing rate in its market. Additionally, a
depository institution is generally prohibited from making any capital
distribution (including payment of a dividend) or paying any management fee to
its holding company, may be subject to asset growth limitations and may be
required to submit capital restoration plans if the depository institution is
considered undercapitalized. The Company’s and City National’s regulatory
capital ratios are presented in the following table:
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December
31,
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2009
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2008
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City
Holding:
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||||||||
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Tier
I Risk-based
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13.57 | % | 12.27 | % | ||||
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Total
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14.54 | 13.46 | ||||||
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Tier
I Leverage
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10.19 | 9.47 | ||||||
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City
National:
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||||||||
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Tier
I Risk-based
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11.17 | % | 10.29 | % | ||||
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Total
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12.16 | 11.49 | ||||||
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Tier
I Leverage
|
8.34 | 7.97 | ||||||
Dividends and Other Payments:
The Company is a legal entity separate and distinct from City National.
Dividends from City National are essentially the sole source of cash for the
Company. The right of the Company, and shareholders of the Company, to
participate in any distribution of the assets or earnings of City National
through the payment of such dividends or otherwise is necessarily subject to the
prior claims of creditors of City National, except to the extent that claims of
the Company in its capacity as a creditor may be
recognized. Moreover, there are various legal limitations applicable
to the payment of dividends to the Company as well as the payment of dividends
by the Company to its shareholders. Under federal law, City National
may not, subject to certain limited expectations, make loans or extensions of
credit to, or invest in the securities of, or take securities of the Company as
collateral for loans to any borrower. City National is also subject to
collateral security requirements for any loans or extensions of credit permitted
by such exceptions.
City
National is subject to various statutory restrictions on its ability to pay
dividends to the Company. Specifically, the approval of the Office of
the Comptroller of the Currency (“OCC”) is required prior to the payment of
dividends by City National in excess of its earnings retained in the current
year plus retained net profits for the preceding two years. The
payment of dividends by the Company and City National may also be limited by
other factors, such as requirements to maintain adequate capital above
regulatory guidelines. The OCC has the authority to prohibit any bank
under its jurisdiction from engaging in an unsafe and unsound practice in
conducting its business. Depending upon the financial condition of City
National, the payment of dividends could be deemed to constitute such an unsafe
or unsound practice. The Federal Reserve Board and the OCC have
indicated their view that it generally would be an unsafe and unsound practice
to pay dividends except out of current operating earnings. The
Federal Reserve Board has stated that, as a matter of prudent banking, a bank or
bank holding company should not maintain its existing rate of cash dividends on
common stock unless (1) the organization’s net income available to common
shareholders over the past year has been sufficient to fund fully the dividends
and (2) the prospective rate of earnings retention appears consistent with the
organization’s capital needs, asset quality, and overall financial condition.
Moreover, the Federal Reserve Board has indicated that bank holding companies
should serve as a source of managerial and financial strength to their
subsidiary banks. Accordingly, the Federal Reserve Board has stated that a bank
holding company should not maintain a level of cash dividends to its
shareholders that places undue pressure on the capital of bank subsidiaries, or
that can be funded only through additional borrowings or other arrangements that
may undermine the bank holding company’s ability to serve as a source of
strength.
-9-
During
2008 and 2009 combined, City National received regulatory approval and paid
$74.9 million of cash dividends to the Parent Company, while generating net
profits of $70.6 million. Therefore, City National will be required
to obtain regulatory approval prior to declaring any cash dividends to the
Parent Company during 2010. Although regulatory authorities have
approved prior cash dividends, there can be no assurance that future dividend
requests will be approved.
During
2009, the Company used cash obtained from these dividends primarily to: (1) pay
common dividends to shareholders, (2) remit interest payments on the Company’s
junior subordinated debentures, and (3) fund repurchases of the Company’s common
shares. Management believes that the Company’s available cash balance, together
with cash dividends from City National, is adequate to satisfy its funding and
cash needs in 2010.
Governmental
Policies
The
Federal Reserve Board regulates money and credit and interest rates in order to
influence general economic conditions. These policies have a significant
influence on overall growth and distribution of bank loans, investments and
deposits and affect interest rates charged on loans or paid for time and savings
deposits. Federal Reserve monetary policies have had a significant effect on the
operating results of commercial banks in the past and are expected to continue
to do so in the future.
Deposit
Insurance
Substantially
all of the deposits of City National are insured up to applicable limits by the
Deposit Insurance Fund (“DIF”) of the FDIC and are subject to deposit insurance
assessments to maintain the DIF. The FDIC utilizes a risk-based assessment
system that imposes insurance premiums based upon a risk matrix that takes into
account a bank’s capital level and supervisory rating (“CAMELS rating”). The
risk matrix utilizes four risk categories which are distinguished by capital
levels and supervisory ratings.
In
December 2008, the FDIC issued a final rule that raised the then current
assessment rates uniformly by 7 basis points for the first quarter of 2009
assessment, which resulted in annualized assessment rates for institutions in
the highest risk category (“Risk Category 1 institutions”) ranging from 12 to 14
basis points (basis points representing cents per $100 of assessable deposits).
In February 2009, the FDIC issued final rules to amend the DIF restoration plan,
change the risk-based assessment system and set assessment rates for Risk
Category 1 institutions beginning in the second quarter of 2009. The initial
base assessment rates for Risk Category 1 institutions range from 12 to 16 basis
points, on an annualized basis. After the effect of potential base-rate
adjustments, total base assessment rates range from 7 to 24 basis points. The
potential adjustments to a Risk Category 1 institution’s initial base assessment
rate, include (i) a potential decrease of up to 5 basis points for long-term
unsecured debt, including senior and subordinated debt and (ii) a potential
increase of up to 8 basis points for secured liabilities in excess of 25% of
domestic deposits.
In May
2009, the FDIC issued a final rule which levied a special assessment applicable
to all insured depository institutions totaling 5 basis points of each
institution’s total assets less Tier 1 capital as of June 30, 2009, not to
exceed 10 basis points of domestic deposits. The special assessment was part of
the FDIC’s efforts to rebuild the DIF. Deposit insurance expense during 2009
included $1.2 million recognized in the second quarter related to the special
assessment.
In
November 2009, the FDIC issued a rule that required all insured depository
institutions, with limited exceptions, to prepay their estimated quarterly
risk-based assessments for the fourth quarter of 2009 and for all of 2010, 2011
and 2012. The FDIC also adopted a uniform three-basis point increase in
assessment rates effective on January 1, 2011. In December 2009, the Corporation
paid $11.6 million in prepaid risk-based assessments that is included in other
assets in the accompanying consolidated balance sheet as of December 31, 2009.
FDIC insurance expense totaled $2.2 million, $0.3 million and $0.2 million in
2009, 2008 and 2007.
-10-
Future
Legislation
Various
other legislative and regulatory initiatives, including proposals to overhaul
the banking regulatory system and to limit the investments that a depository
institution may make with insured funds, are from time to time introduced in
Congress and state legislatures, as well as regulatory agencies. Such
legislation may change banking statutes and the operating environment of the
Company and its subsidiaries in substantial and unpredictable ways, and could
increase or decrease the cost of doing business, limit or expand permissible
activities or affect the competitive balance depending upon whether any of this
potential legislation will be enacted, and if enacted, the effect that it or any
implementing regulations, would have on the financial condition or results of
operations of the Company or any of its subsidiaries. The nature and extent of
future legislative and regulatory changes affecting financial institutions is
very unpredictable at this time. The Company cannot determine the
ultimate effect that such potential legislation, if enacted, would have upon its
financial condition or operations.
Executive
Officers of the Registrant
At
December 31, 2009, the executive officers of the Company were as
follows:
|
Name
|
Age
|
Business
Experience
|
|
Charles
R. Hageboeck, Ph.D.
|
47
|
President
and Chief Executive Officer, City Holding Company and City National Bank,
Charleston, WV since February 1, 2005. Executive Vice President
and Chief Financial Officer, City Holding Company and City National Bank,
Charleston, WV from June 2001 – January 31, 2005.
|
|
Craig
G. Stilwell
|
54
|
Executive
Vice President of Retail Banking, City Holding Company and City National
Bank, Charleston, WV since February 2005. Executive Vice
President of Marketing & Human Resources, City Holding Company and
City National Bank, Charleston, WV from May 2001 – February
2005.
|
|
John
A. DeRito
|
59
|
Executive
Vice President of Commercial Banking, City Holding Company and City
National Bank, Charleston, WV since June 25, 2004. Regional Credit Officer
for the West Virginia Central Region of BB&T, Charleston, WV from
November 2000 – June 2004. Senior Vice President and Credit
Officer, One Valley Bank, Charleston, WV from November 1983 – November
2000.
|
|
David
L. Bumgarner
|
44
|
Senior
Vice President and Chief Financial Officer, City Holding Company and City
National Bank since February 2005. Audit Senior Manager, Arnett
& Foster, PLLC from August 2000 – January 2005.
|
|
Michael
T. Quinlan, Jr.
|
41
|
Senior
Vice President, Branch Banking, City Holding Company and City National
Bank since August 2001
|
Employees
The
Company had 809 full-time equivalent employees at December 31,
2009.
-11-
Available
Information
The
Company’s Internet website address is www.cityholding.com. The
Company makes available free of charge through its website its annual report on
Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and
amendments to those reports filed or furnished pursuant to Section 13(a) or
15(d) of the Securities Exchange Act of 1934, as amended, as soon as reasonably
practicable after such documents are electronically filed with, or furnished to,
the Securities and Exchange Commission. The information on the Company’s website
is not, and shall not be deemed to be, a part of this report or incorporated
into any other filing with the Securities and Exchange Commission. Copies of the
Company’s annual report will be made available, free of charge, upon written
request.
Statistical
Information
The
information noted below is provided pursuant to Guide 3 -- Statistical
Disclosure by Bank Holding Companies. Page references are to the Annual Report
to Shareholders for the year ended December 31, 2009 and such pages have been
filed as an exhibit to this Form 10-K and are incorporated herein by
reference.
|
Description of Information
|
Page
Reference
|
||||||||||
| 1. |
Distribution
of Assets, Liabilities and Stockholders'
|
||||||||||
|
Equity;
Interest Rates and Interest Differential
|
|||||||||||
| a. |
Average
Balance Sheets
|
6 | |||||||||
| b. |
Analysis
of Net Interest Earnings
|
7 | |||||||||
| c. |
Rate
Volume Analysis of Changes in Interest
Income and Expense
|
8 | |||||||||
| 2. |
Investment
Portfolio
|
||||||||||
| a. |
Book
Value of Investments
|
14 | |||||||||
| b. |
Maturity
Schedule of Investments
|
14 | |||||||||
| c. |
Securities
of Issuers Exceeding 10% of Stockholders’
Equity
|
14 | |||||||||
| 3. |
Loan
Portfolio
|
||||||||||
| a. |
Types
of Loans
|
15 | |||||||||
| b. |
Maturities
and Sensitivity to Changes in Interest Rates
|
15 | |||||||||
| c. |
Risk
Elements
|
18 | |||||||||
| d. |
Other
Interest Bearing Assets
|
N/A | |||||||||
| 4. |
Summary
of Loan Loss Experience
|
18 | |||||||||
| 5. |
Deposits
|
||||||||||
| a. |
Breakdown
of Deposits by Categories, Average Balance And
Average Rate Paid
|
6 | |||||||||
| b. |
Maturity
Schedule of Time Certificates of Deposit and
Other Time Deposits of $100,000 or More
|
21 | |||||||||
| 6. |
Return
on Equity and Assets
|
4 | |||||||||
| 7. |
Short-term
Borrowings
|
21 | |||||||||
-12-
|
Item
1A.
|
Risk
Factors
|
An
investment in the Company’s common stock is subject to risks inherent to the
Company’s business. The material risks and uncertainties that management
believes affect the Company are described below. The risks and uncertainties
described below are not the only ones facing the Company. Additional risks and
uncertainties that management is not aware of or focused on or that management
currently deems immaterial may also impair the Company’s business
operations. You should carefully consider the risks described below,
as well as the other information included or incorporated by reference in this
Annual Report on Form 10-K, before making an investment in the Company’s common
stock. If any of the following risks occur, the Company’s financial
condition and results of operations could be materially and adversely affected,
and you could lose all or part of your investment.
The
Company’s Business May be Adversely Affected by Conditions in the Financial
Markets and Economic Conditions Generally
The
business environment that the Company operates in the United States and
worldwide could deteriorate, which could affect the credit quality of the
Company’s loans, results of operations, and financial
condition. Since December 2007, the United States has been in a
recession. Business activity across a wide range of industries and regions is
greatly reduced and local governments and many businesses are in serious
difficulty due to the lack of consumer spending and the lack of liquidity in the
credit markets. Unemployment has increased significantly.
As a
result of the recession, the financial services industry and the securities
markets have been materially and adversely affected by significant declines in
the values of nearly all asset classes and by a serious lack of liquidity. This
was initially triggered by declines in home prices and the values of subprime
mortgages but spread to all mortgage and real estate asset classes, to leverage
bank loans and to nearly all asset classes, including equities. The global
markets have been characterized by substantially increased volatility and
short-selling and an overall loss of investor confidence, initially in financial
institutions but more recently in companies in a number of other industries and
in the broader markets.
Market
conditions have also led to the failure or merger of a number of prominent
financial institutions. Financial institution failures or near-failures have
resulted in further losses as a consequence of defaults on securities issued by
them and defaults under contracts entered into with such entities as
counterparties. Furthermore, declining asset values, defaults on mortgages and
consumer loans, and the lack of market and investor confidence, as well as other
factors, have all combined to increase credit default swap spreads, to cause
rating agencies to lower credit ratings, and to otherwise increase the cost and
decrease the availability of liquidity, despite very significant declines in
Federal Reserve borrowing rates and other government actions. Some banks and
other lenders have suffered significant losses and have become reluctant to
lend, even on a secured basis, due to the increased risk of default and the
impact of declining asset values on the value of collateral. The foregoing has
significantly weakened the strength and liquidity of some financial institutions
worldwide.
The
Company’s financial performance generally, and in particular the ability of
borrowers to pay interest on and repay principal of outstanding loans and the
value of collateral securing those loans, is highly dependent upon on the
business environment in the markets where the Company operates, in the States of
West Virginia, Kentucky, and Ohio, and in the United States as a whole. A
favorable business environment is generally characterized by, among other
factors, economic growth, efficient capital markets, low inflation, high
business and investor confidence, and strong business earnings. Unfavorable or
uncertain economic and market conditions can be caused by: declines in economic
growth, business activity or investor or business confidence; limitations on the
availability or increases in the cost of credit and capital; increases in
inflation or interest rates; natural disasters; or a combination of these or
other factors.
Overall,
during 2009, the business environment has continued to be adverse for many
households and businesses in the United States and worldwide. The business
environments in West Virginia, Kentucky, and Ohio, and the markets in which the
Company operates have been less adverse than in the United States generally but
continue to deteriorate. It is expected that the business environment in the
States of West Virginia, Kentucky, and Ohio, the United States and worldwide
will continue to deteriorate for the foreseeable future. There can be no
assurance that these conditions will improve in the near term. Such conditions
could adversely affect the credit quality of the Company’s loans, results of
operations and financial condition.
-13-
The
Value of the Company’s Common Stock May Fluctuate
The
market for the Company’s common stock may experience significant price and
volume fluctuations in response to a number of factors including actual or
anticipated quarterly variations in operating results, changes in expectations
of future financial performance, changes in estimates by securities analysts,
governmental regulatory action, banking industry reform measures, customer
relationship developments and other factors, many of which will be beyond the
Company’s control.
Furthermore,
the stock market in general, and the market for financial institutions in
particular, have experienced extreme volatility that often has been unrelated to
the operating performance of particular companies. These broad market and
industry fluctuations may adversely affect the trading price of the Company’s
common stock, regardless of actual operating performance.
The
Trading Volume In The Company’s Common Stock Is Less Than That Of Other Larger
Financial Services Companies
Although
the Company’s common stock is listed for trading on the Nasdaq Stock Market,
Inc. (NASDAQ), the trading volume in its common stock is less than that of other
larger financial services companies. A public trading market having the desired
characteristics of depth, liquidity and orderliness depends on the presence in
the marketplace of willing buyers and sellers of the Company’s common stock at
any given time. This presence depends on the individual decisions of investors
and general economic and market conditions over which the Company has no
control. Given the lower trading volume of the Company’s common stock,
significant sales of the Company’s common stock, or the expectation of these
sales, could cause the Company’s stock price to fall.
Future
Sales of Shares of the Company’s Common Stock Could Negatively Affect its Market
Price
Future
sales of substantial amounts of the Company’s common stock, or the perception
that such sales could occur, could adversely affect the market price of the
Company’s common stock in the open market. We make no prediction as to the
effect, if any, that future sales of shares, or the availability of shares for
future sale, will have on the market price of the Company’s common
stock.
Shares
of the Company’s Common Stock Are Not FDIC Insured
Neither
the Federal Deposit Insurance Corporation nor any other governmental agency
insures the shares of the Company’s common stock. Therefore, the value of your
shares in the Company will be based on their market value and may
decline.
Anti-takeover
Defenses May Delay or Prevent Future Mergers
The
Company has entered into a Rights Agreement with SunTrust, as its rights agent,
designed to discourage the accumulation of shares in excess of 15% of the
Company’s outstanding shares. This agreement could limit the price that some
investors might be willing to pay in the future for shares of the Company’s
common stock and may have the effect of delaying or preventing a change in
control. The Rights Agreement with SunTrust expires on June 12,
2011.
The
Company’s Ability To Pay Dividends Is Limited
Although
the Board of Directors has declared cash dividends in the past, the current
ability to pay dividends is largely dependent upon the receipt of dividends from
City National. Federal and state laws impose restrictions on the ability of City
National to pay dividends. Holders of shares of the Company’s common stock are
entitled to dividends if, and when, they are declared by the Company’s Board of
Directors out of funds legally available for that purpose. Additional
restrictions are placed upon the Company by the policies of federal regulators,
including the Federal Reserve Board’s November 14, 1985 policy statement, which
provides that bank holding companies should pay dividends only out of the past
year’s net income, and then only if their prospective rate of earnings retention
appears consistent with their capital needs, asset quality, and overall
financial condition. In general, future dividend policy is subject to the
discretion of the Board of Directors and will depend upon a number of factors,
including the Company’s and City National’s future earnings, capital
requirements, regulatory constraints and financial condition.
-14-
An
Economic Slowdown in West Virginia, Kentucky, and Ohio Could Hurt Our
Business
Because
the Company focuses its business in West Virginia, Kentucky, and Ohio, an
economic slowdown in these states could hurt our business. An economic slowdown
could have the following consequences:
|
·
|
Loan
delinquencies may increase;
|
|
·
|
Problem
assets and foreclosures may
increase;
|
|
·
|
Demand
for the products and services of City National may decline;
and
|
|
·
|
Collateral
(including real estate) for loans made by City National may decline in
value, in turn reducing customers’ borrowing power, and making existing
loans less secure.
|
The
Company and City National are Extensively Regulated
Policies
adopted or required by these governmental authorities can adversely affect the
Company’s business operations and the availability, growth and distribution of
the Company’s investments, borrowings and deposits. The operations of
the Company and City National are subject to extensive regulation by federal,
state and local governmental authorities and are subject to various laws and
judicial and administrative decisions imposing requirements and restrictions on
them. In addition, the Office of the Comptroller of the Currency periodically
conducts examinations of the Company and City National and may impose various
requirements or sanctions.
Proposals
to change the laws governing financial institutions are frequently raised in
Congress and before bank regulatory authorities. Changes in applicable laws or
policies could materially affect the Company’s business, and the likelihood of
any major changes in the future and their effects are impossible to determine.
Moreover, it is impossible to predict the ultimate form any proposed legislation
might take or how it might affect the Company.
The
Company is Subject to Interest Rate Risk
Changes
in monetary policy, including changes in interest rates, could influence not
only the interest the Company receives on loans and securities and the amount of
interest it pays on deposits and borrowings, but such changes could also affect
(i) the Company’s ability to originate loans and obtain deposits,
(ii) the fair value of the Company’s financial assets and liabilities, and
(iii) the average duration of the Company’s mortgage-backed securities
portfolio. The Company’s earnings and cash flows are largely dependent upon its
net interest income. Net interest income is the difference between interest
income earned on interest-earning assets such as loans and securities and
interest expense paid on interest-bearing liabilities such as deposits and
borrowed funds. Interest rates are highly sensitive to many factors that are
beyond the Company’s control, including general economic conditions and policies
of various governmental and regulatory agencies and, in particular, the Board of
Governors of the Federal Reserve System. If the interest rates paid on deposits
and other borrowings increase at a faster rate than the interest rates received
on loans and other investments, the Company’s net interest income, and therefore
earnings, could be adversely affected. Earnings could also be adversely affected
if the interest rates received on loans and other investments fall more quickly
than the interest rates paid on deposits and other borrowings.
Although
management believes it has implemented effective asset and liability management
strategies, including the use of derivatives as hedging instruments, to reduce
the potential effects of changes in interest rates on the Company’s results of
operations, any substantial, unexpected, prolonged change in market interest
rates could have a material adverse effect on the Company’s financial condition
and results of operations. See the section captioned “Risk Management” in
Item 7. Management’s Discussion and Analysis of Financial Condition and
Results of Operations located elsewhere in this report for further discussion
related to the Company’s management of interest rate risk.
-15-
The
Company’s Allowance for Loan Losses May Not Be Sufficient
The
Company maintains an allowance for loan losses, which is a reserve established
through a provision for loan losses charged to expense that represents
management’s best estimate of probable losses in the existing portfolio of
loans. The allowance, in the judgment of management, is necessary to provide for
estimated loan losses and risks inherent in the loan portfolio. The level of the
allowance reflects management’s continuing evaluation of industry
concentrations; specific credit risks; loan loss experience; current loan
portfolio quality; present economic, political and regulatory conditions and
unidentified losses inherent in the current loan portfolio. The determination of
the appropriate level of the allowance for loan losses inherently involves a
high degree of subjectivity and requires the Company to make significant
estimates of current credit risks and future trends, all of which may undergo
material changes. Changes in economic conditions affecting borrowers, new
information regarding existing loans, identification of additional problem loans
and other factors, both within and outside of the Company’s control, may require
an increase in the allowance for loan losses. In addition, bank regulatory
agencies periodically review the Company’s allowance for loan losses and may
require an increase in the provision for loan losses or the recognition of
further loan charge-offs, based on judgments different than those of management.
In addition, if charge-offs in future periods exceed the allowance for loan
losses, the Company will need additional provisions to increase the allowance
for loan losses. Any increases in the allowance for loan losses will result in a
decrease in net income and, possibly, capital, and may have a material adverse
effect on the Company’s financial condition and results of
operations.
Management
evaluates the adequacy of the allowance for loan losses at least quarterly,
which includes testing certain individual loans as well as collective pools of
loans for impairment. This evaluation includes an assessment of actual loss
experience within each category of the portfolio, individual commercial and
commercial real estate loans that exhibit credit weakness; current economic
events, including employment statistics, trends in bankruptcy filings, and other
pertinent factors; industry or geographic concentrations, and regulatory
guidance. See the section captioned “Allowance and Provision for Loan
Losses” in Item 7. Management’s Discussion and Analysis of Financial
Condition and Results of Operations located elsewhere in this report for further
discussion related to the Company’s process for determining the appropriate
level of the allowance for loan losses.
Customers
May Default On the Repayment of Loans
City
National’s customers may default on the repayment of loans, which may negatively
impact the Company’s earnings due to loss of principal and interest income.
Increased operating expenses may result from the allocation of management time
and resources to the collection and work-out of the loan. Collection efforts may
or may not be successful causing the Company to write off the loan or repossess
the collateral securing the loan, which may or may not exceed the balance of the
loan.
Due
To Increased Competition, the Company May Not Be Able To Attract and Retain
Banking Customers At Current Levels
The
Company faces competition from the following:
|
·
|
local,
regional and national banks;
|
|
·
|
savings
and loans;
|
|
·
|
internet
banks;
|
|
·
|
credit
unions;
|
|
·
|
finance
companies; and
|
|
·
|
brokerage
firms serving the Company’s market
areas.
|
In
particular, City National’s competitors include several major national financial
and banking companies whose greater resources may afford them a marketplace
advantage by enabling them to maintain numerous banking locations and mount
extensive promotional and advertising campaigns. Additionally, banks and other
financial institutions may have products and services not offered by the
Company, which may cause current and potential customers to choose those
institutions. Areas of competition include interest rates for loans and
deposits, efforts to obtain deposits and range and quality of services provided.
If the Company is unable to attract new and retain current customers, loan and
deposit growth could decrease causing the Company’s results of operations and
financial condition to be negatively impacted.
-16-
The
Company May Be Required To Write Down Goodwill And Other Intangible Assets,
Causing Its Financial Condition And Results To Be Negatively
Affected
When the
Company acquires a business, a portion of the purchase price of the acquisition
is allocated to goodwill and other identifiable intangible assets. The excess of
the purchase price over the fair value of the net identifiable tangible and
intangible assets acquired determines the amount of the purchase price that is
allocated to goodwill acquired. At December 31, 2009, the Company’s goodwill and
other identifiable intangible assets were approximately $57.0 million. Under
current accounting standards, if the Company determines goodwill or intangible
assets are impaired, it would be required to write down the value of these
assets. The Company conducts an annual review to determine whether goodwill and
other identifiable intangible assets are impaired. The Company recently
completed such an impairment analysis and concluded that no impairment charge
was necessary for the year ended December 31, 2009. The Company cannot provide
assurance whether it will be required to take an impairment charge in the
future. Any impairment charge would have a negative effect on its shareholders’
equity and financial results and may cause a decline in our stock
price.
Acquisition
Opportunities May Present Challenges
The
Company expects that other banking and financial companies, many of which have
significantly greater resources, will compete with it to acquire compatible
businesses. The Company continually evaluates opportunities to acquire other
businesses. However, the Company may not have the opportunity to make suitable
acquisitions on favorable terms in the future, which could negatively impact the
growth of its business. This competition could increase prices for acquisitions
that the Company would likely pursue, and its competitors may have greater
resources than it does. Also, acquisitions of regulated businesses such as banks
are subject to various regulatory approvals. If the Company fails to receive the
appropriate regulatory approvals, it will not be able to consummate an
acquisition that it believes is in its best interests.
Any
future acquisitions may result in unforeseen difficulties, which could require
significant time and attention from our management that would otherwise be
directed at developing our existing business. In addition, we could discover
undisclosed liabilities resulting from any acquisitions for which we may become
responsible. Further, the benefits that we anticipate from these acquisitions
may not develop.
The
Company’s Controls and Procedures May Fail or Be Circumvented
Any
failure or circumvention of the Company’s controls and procedures or failure to
comply with regulations related to controls and procedures could have a material
adverse effect on the Company’s business, results of operations and financial
condition. Management regularly reviews and updates the Company’s
internal controls, disclosure controls and procedures, and corporate governance
policies and procedures. Any system of controls, no matter how well designed and
operated, is based in part on certain assumptions and can provide only
reasonable, not absolute, assurances that the objectives of the system are
met.
The
Company May Not Be Able To Attract and Retain Skilled People
The
unexpected loss of services of one or more of the Company’s key personnel could
have a material adverse impact on the Company’s business because of their
skills, knowledge of the Company’s market, years of industry experience and the
difficulty of promptly finding qualified replacement personnel. The
Company’s success depends, in large part, on its ability to attract and retain
key people. Competition for the best people in most activities engaged in by the
Company can be intense and the Company may not be able to hire people or to
retain them.
-17-
|
Item
1B.
|
Unresolved Staff
Comments
|
On
February 22, 2010, the Company received a comment letter from the Securities and
Exchange Commission regarding our December 31, 2008 Form 10-K, March 31, 2009
Form 10-Q, June 30, 2009 Form 10-Q, and September 30, 2009 Form
10-Q. The Company is in the process of responding to this Comment
Letter.
|
Item
2.
|
Properties
|
City
National owns the Company’s executive offices, located at 25 Gatewater Road,
Charleston, West Virginia. City National operates 67 branch offices, with 56
offices in West Virginia, eight in Kentucky, and three offices in Ohio. The West
Virginia locations are primarily centered in the Charleston, Huntington,
Beckley, and Martinsburg markets. City National owns 49 locations and leases 18
locations, pursuant to operating leases. All of the properties are
suitable and adequate for their current operations and are generally being fully
utilized.
City
National also owns a thirty thousand square foot office building in an
unincorporated area approximately fifteen miles west of Charleston, West
Virginia. This facility formerly housed loan operations personnel, but has since
been vacated by the Company. The building is currently being leased to a third
party.
|
Item
3.
|
Legal
Proceedings
|
The
Company is engaged in various legal actions that it deems to be in the ordinary
course of business. As these legal actions are resolved, the Company could
realize positive and/or negative impact to its financial performance in the
period in which these legal actions are ultimately decided. There can be no
assurance that current actions will have immaterial results, either positive or
negative, or that no material actions may be presented in the
future.
|
Item
4.
|
Submission of Matters to a
Vote of Security Holders
|
None
-18-
PART
II
|
Item
5.
|
Market for Registrant's
Common Equity, Related Stockholder Matters, and Issuer Purchases of Equity
Securities
|
Common
Stock Market and Dividends
The
Company’s common stock trades on the NASDAQ stock market under the symbol CHCO.
This table sets forth the cash dividends paid per share and information
regarding the market prices per share of the Company’s common stock for the
periods indicated. The price ranges are based on transactions as reported on the
NASDAQ stock market. At December 31, 2009, there were 2,958 shareholders of
record.
|
Cash
|
||||||||||||
|
Dividends
|
Market
Value
|
|||||||||||
|
Per
Share
|
Low
|
High
|
||||||||||
|
2009
|
||||||||||||
|
Fourth
Quarter
|
$ | 0.34 | $ | 28.96 | $ | 33.29 | ||||||
|
Third
Quarter
|
0.34 | 28.65 | 34.34 | |||||||||
|
Second
Quarter
|
0.34 | 27.02 | 33.78 | |||||||||
|
First
Quarter
|
0.34 | 20.88 | 33.41 | |||||||||
|
2008
|
||||||||||||
|
Fourth
Quarter
|
$ | 0.34 | $ | 29.08 | $ | 42.88 | ||||||
|
Third
Quarter
|
0.34 | 35.74 | 47.28 | |||||||||
|
Second
Quarter
|
0.34 | 37.29 | 44.15 | |||||||||
|
First
Quarter
|
0.34 | 32.51 | 41.37 | |||||||||
As noted
in the section captioned Dividends and Other Payments included in Item 1.
Business, the section captioned Liquidity included in Item 7. Management’s
Discussion and Analysis of Financial Condition and Results of Operations and in
Note Eighteen of Notes to Consolidated Financial Statements, the Company’s
ability to pay dividends to its shareholders is dependent upon the ability of
City National to pay dividends to City Holding (“Parent Company”).
Stock
Repurchase Plan
The
following table sets forth information regarding the Company's common stock
repurchases transacted during the quarter:
|
Period
|
Total
Number
of
Shares
Purchased
|
Average
Price
Paid
per
Share
|
Total
Number
of
Shares
Purchased
as
Part of Publicly
Announced
Plans
or
Programs (a)
|
Maximum
Number of Shares that May Yet Be Purchased Under the Plans or
Programs
|
||||||
|
October
1 – October 31, 2009
|
27,600
|
$
|
30.40
|
27,600
|
972,600
|
|||||
|
November
1 – November 30, 2009
|
-
|
-
|
-
|
-
|
||||||
|
December
1 - December 31, 2009
|
-
|
-
|
-
|
-
|
||||||
|
(a)
|
In August 2007, the Company
announced that the Board of Directors had authorized the Company to buy
back up to 1,000,000 shares of its common stock, in open market
transactions at prices that are accretive to continuing
shareholders. In October 2009, the Company announced that the Board
of Directors rescinded the share repurchase program approved in August
2007 and announced it had authorized the Company to buy back up to
1,000,000 shares of its common stock, in open market transactions at
prices that are accretive to continuing shareholders. No
timetable was placed on the duration of this share repurchase
program.
|
-19-
Stock-Based
Compensation Plan
Information regarding stock-based
compensation awards outstanding and available for future grants as of December
31, 2009, segregated between stock-based compensation plans approved by
shareholders and stock-based compensation plans not approved by shareholders, is
presented in the table below. Additional information regarding
stock-based compensation plans is presented in Note Fourteen Employee Benefit
Plans of Notes to Consolidated Financial Statements.
|
Plan
Category
|
Number
of Shares to be Issued Upon Exercise of Outstanding Awards
(a)
|
Weighted-average
exercise price of outstanding awards
(b)
|
Number
of securities remaining available for future issuance under equity
compensation plans (excluding securities reflected in column
(a))
(c)
|
|||||||||
|
Plans
approved by shareholders
|
280,605 | $ | 33.56 | 735,000 | ||||||||
|
Plans
not approved by shareholders
|
- | - | - | |||||||||
|
Total
|
280,605 | $ | 33.56 | 735,000 | ||||||||
-20-
Stock
Performance
The following graph sets forth the
cumulative total shareholder return (assuming reinvestment of dividends) to the
Company’s shareholders during the five-year period ended December 31, 2009,
as well as an overall stock market index (The Nasdaq Stock Market Index) and the
Company’s Peer Group. The Peer Group consists of certain publicly-traded banking
institutions over $1 billion but less than $9 billion in assets located in West
Virginia and adjoining states. The trading symbols for such financial
institutions include: FCBC, SASR, CTBI, NPBC, UBSH, WSBC, STEL, HNBC, PRK,
RBCAA, PEBO, STBA, UBSI, FFBC, UVSP, FNB, NBTB, FCF, CBU, and
FPFC. The stock performance shown on the graph below is not
necessarily indicative of future price performance.
|
2004
|
2005
|
2006
|
2007
|
2008
|
2009
|
|
|
City
Holding Company
|
100.00
|
102.13
|
119.67
|
102.20
|
108.85
|
105.80
|
|
NASDAQ
Composite
|
100.00
|
101.37
|
111.03
|
121.92
|
72.49
|
104.31
|
|
Peer
Group
|
100.00
|
91.03
|
101.00
|
77.66
|
89.64
|
55.20
|
This
graph shall not be deemed to be incorporated by reference into any filing under
the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934,
as amended, unless the Company specifically incorporates this report by
reference. It will not be otherwise filed under such Acts.
|
Item
6.
|
Selected Financial
Data
|
Selected
Financial Data on page 1 of the Annual Report to Shareholders of City Holding
Company for the year ended December 31, 2009, included in this report as Exhibit
13, is incorporated herein by reference.
|
Item
7.
|
Management's Discussion and
Analysis of Financial Condition and Results of
Operations
|
Management's
Discussion and Analysis of Financial Condition and Results of Operations on
pages 2 through 23 of the Annual Report to Shareholders of City Holding Company
for the year ended December 31, 2009, included in this report as Exhibit 13, is
incorporated herein by reference.
-21-
|
Item
7A.
|
Quantitative and Qualitative
Disclosures About Market
Risk
|
Information
appearing under the caption “Risk Management” appearing on pages 11-12 of the
Annual Report to Shareholders of City Holding Company for the year ended
December 31, 2009, included in this report as Exhibit 13, is incorporated herein
by reference.
|
Item
8.
|
Financial Statements and
Supplementary Data
|
The
consolidated financial statements, notes to consolidated financial statements,
reports of management and the independent registered public accounting firm
included on pages 24 through 61 of the Annual Report to Shareholders of City
Holding Company for the year ended December 31, 2009, included in this report as
Exhibit 13, are incorporated herein by reference.
|
Item
9.
|
Changes in and Disagreements
With Accountants on Accounting and Financial
Disclosure
|
None
|
Item
9A.
|
Controls and
Procedures
|
Pursuant
to Rule 13a-15b under the Securities Exchange Act of 1934, the Company carried
out an evaluation, with the participation of the Company’s management, including
the Company’s Chief Executive Officer and Chief Financial Officer, of the
effectiveness of the Company’s disclosure controls and procedures (as defined
under Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934)
as of the end of the period covered by this report. Based upon that evaluation,
the Company’s Chief Executive Officer and Chief Financial Officer concluded that
the Company’s disclosure controls and procedures are effective in timely
alerting them to material information relating to the Company required to be
included in the Company’s periodic Securities and Exchange Commission
filings.
|
(a)
|
Management’s
annual report on internal control over financial reporting appears on page
24 of the Annual Report to Shareholders of City Holding Company for the
year ended December 31, 2009, included in this report as Exhibit 13, is
incorporated herein by reference.
|
|
(b)
|
The
Company did not have any changes in internal control over financial
reporting during its fourth quarter for the year ending December 31, 2009,
that materially affected, or were reasonably likely to materially affect,
the Company’s internal control over financial
reporting.
|
The
Report of Management on Internal Control Over Financial Reporting is included in
Item 8. of this Annual Report on Form 10-K.
|
Item
9B.
|
Other
Information
|
None
PART
III
|
Item
10.
|
Directors, Executive Officers
and Corporate Governance
|
Certain
information regarding executive officers is included under the section captioned
“Executive Officers of The Registrant” in Part I, Item 1, elsewhere in
this Annual Report on Form 10-K. Other information required by
this Item appears under the captions “ELECTION OF DIRECTORS”, “ADDITIONAL
INFORMATION CONCERNING THE BOARD OF DIRECTORS”, “REPORT OF THE AUDIT COMMITTEE”,
“SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE” in the Company's 2010
Proxy Statement that will be filed within 120 days of fiscal year end and is
hereby incorporated by reference.
In
December 2009, the Company adopted a new Code of Business Conduct and Ethics
which applies to all employees (including its chief executive officer, chief
financial officer and principal accounting officer). Members of the
Board of Directors are governed by a separate Code of Business Conduct and
Ethics approved in January 2004. Both of the Codes of Business
Conduct and Ethics have been posted on its website at www.cityholding.com under
the “Corporate Governance” link located at the bottom of the
page. A copy of the Company’s Code of Business Conduct and
Ethics covering all employees and/or a copy of Code of Business Conduct and
Ethics covering the Board of Directors will be mailed without charge upon
request to Investor Relations, City Holding Company, 25 Gatewater Road, P. O.
Box 7520, Charleston, WV 25356-0520. Any amendments to or
waivers from any provision of the Code of Ethics applicable to the Company’s
chief executive officer, chief financial officer, or principal accounting
officer will be disclosed by timely posting such information on the Company’s
internet website.
-22-
|
Item
11.
|
Executive
Compensation
|
The
information required by Item 11 of FORM 10-K appears under the captions
"COMPENSATION OF DIRECTORS", “COMPENSATION DISCUSSION AND ANALYSIS”, “ANNUAL
COMPENSATION”, “EQUITY HOLDINGS”, “POST-EMPLOYMENT PAYMENTS”, and “BOARD
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION” in the Company's 2010
Proxy Statement that will be filed within 120 days of fiscal year end and is
hereby incorporated by reference.
|
Item
12.
|
Security Ownership of Certain
Beneficial Owners and Management and Related Stockholder
Matters
|
The
information required by Item 12 of FORM 10-K appears under the caption "COMMON
STOCK OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT" in the Company's
2010 Proxy Statement that will be filed within 120 days of fiscal year end and
is hereby incorporated by reference.
|
Item
13.
|
Certain Relationships and
Related Transactions, Director
Independence
|
The
information required by Item 13 of FORM 10-K appears under the caption "CERTAIN
TRANSACTIONS INVOLVING DIRECTORS AND EXECUTIVE OFFICERS" in the Company's 2010
Proxy Statement that will be filed within 120 days of fiscal year end and is
hereby incorporated by reference.
|
Item
14.
|
Principal Accounting Fees and
Services
|
The
information required by Item 14 of FORM 10-K appears under the caption
"PRINCIPAL ACCOUNTING FEES AND SERVICES" in the Company's 2010 Proxy Statement
that will be filed within 120 days of fiscal year end and is hereby incorporated
by reference.
-23-
PART
IV
|
Item
15.
|
Exhibits, Financial Statement
Schedules
|
|
(a)
|
(1)
|
Financial Statements. Reference
is made to Part II, Item 8, of this Annual Report on Form
10-K.
|
|
(2)
|
Financial Statement
Schedules. These schedules are omitted as the required
information is inapplicable or the information is presented in the
consolidated financial statements or related notes.
|
|
|
(3)
|
Exhibits. The exhibits listed in
the “Exhibit Index” on pages 27-29 of this Annual Report on Form 10-K
included herein are filed herewith or incorporated by reference from
previous filings.
|
|
|
(b)
|
See
(a) (3) above.
|
|
|
(c)
|
See
(a) (1) and (2) above.
|
|
-24-
|
SIGNATURES
|
Pursuant
to the requirements of Section 13 or 15(d) 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.
|
Date: March
29, 2010
|
City
Holding Company
|
||
|
(Registrant)
|
|||
|
/s/
Charles R. Hageboeck, Ph.D.
|
|||
|
Charles
R. Hageboeck, Ph.D.
|
|||
|
President
and Chief Executive Officer
|
|||
|
(Principal
Executive Officer)
|
|||
|
/s/
David L. Bumgarner
|
|||
|
David
L. Bumgarner
|
|||
|
Senior
Vice President, Chief Financial Officer and Principal Accounting
Officer
|
|||
|
(Principal
Financial Officer)
|
|||
|
/s/
Charles R. Hageboeck, Attorney-in-Fact
|
/s/
Charles R. Hageboeck, Attorney-in-Fact
|
|
|
Philip
L. McLaughlin
|
David
W. Hambrick
|
|
|
Chairman
|
Director
|
|
|
/s/
Charles R. Hageboeck, Attorney-in-Fact
|
/s/
Charles R. Hageboeck, Ph.D.
|
|
|
Hugh
R. Clonch
|
Charles
R. Hageboeck, Ph.D.
|
|
|
Director
|
Director,
President, and Chief Executive Officer
|
|
|
/s/
Charles R. Hageboeck, Attorney-in-Fact
|
/s/
Charles R. Hageboeck, Attorney-in-Fact
|
|
|
Oshel
B. Craigo
|
Tracy
W. Hylton, II
|
|
|
Director
|
Director
|
|
|
/s/
Charles R. Hageboeck, Attorney-in-Fact
|
/s/
Charles R. Hageboeck, Attorney-in-Fact
|
|
|
John
R Elliot
|
C.
Dallas Kayser
|
|
|
Director
|
Director
|
|
|
/s/
Charles R. Hageboeck, Attorney-in-Fact
|
/s/
Charles R. Hageboeck, Attorney-in-Fact
|
|
|
William
H. File, III
|
James
L. Rossi
|
|
|
Director
|
Director
|
|
|
/s/
Charles R. Hageboeck, Attorney-in-Fact
|
/s/
Charles R. Hageboeck, Attorney-in-Fact
|
|
|
Robert
D. Fisher
|
Sharon
H. Rowe
|
|
|
Director
|
Director
|
|
|
/s/
Charles R. Hageboeck, Attorney-in-Fact
|
/s/
Charles R. Hageboeck, Attorney-in-Fact
|
|
|
Jay
C. Goldman
|
Mary
H. Williams
|
|
|
Director
|
Director
|
|
-25-
POWER
OF ATTORNEY
Pursuant
to the requirements of the Securities Exchange Act of 1934, this report has been
signed below by the following persons on behalf of the Registrant and in the
capacities indicated on February 24, 2010. Each of the directors and/or officers
of City Holding Company whose signature appears below hereby appoints Philip L.
McLaughlin, and/or Charles R. Hageboeck Ph.D., as his attorney-in-fact to sign
in his name and behalf, in any and all capacities stated below and to file with
the Securities and Exchange Commission, any and all amendments to this report on
Form 10-K, making such changes in this report on Form 10-K as appropriate, and
generally to do all such things in their behalf in their capacities as officers
and directors to enable City Holding Company to comply with the provisions of
the Securities Exchange Act of 1934, and all requirements of the Securities and
Exchange Commission.
|
/s/
Philip L. McLaughlin
|
/s/
David W. Hambrick
|
|
|
Philip
L. McLaughlin
|
David
W. Hambrick
|
|
|
Chairman
|
Director
|
|
|
/s/
Hugh R. Clonch
|
/s/
Charles R. Hageboeck, Ph.D.
|
|
|
Hugh
R. Clonch
|
Charles
R. Hageboeck, Ph.D.
|
|
|
Director
|
Director,
President, and Chief Executive Officer
|
|
|
/s/
Oshel B. Craigo
|
/s/
Tracy W. Hylton, II
|
|
|
Oshel
B. Craigo
|
Tracy
W. Hylton, II
|
|
|
Director
|
Director
|
|
|
/s/
John R Elliot
|
/s/
C. Dallas Kayser
|
|
|
John
R Elliot
|
C.
Dallas Kayser
|
|
|
Director
|
Director
|
|
|
/s/
William H. File, III
|
/s/
James L. Rossi
|
|
|
William
H. File, III
|
James
L. Rossi
|
|
|
Director
|
Director
|
|
|
/s/
Robert D. Fisher
|
/s/
Sharon H. Rowe
|
|
|
Robert
D. Fisher
|
Sharon
H. Rowe
|
|
|
Director
|
Director
|
|
|
/s/
Jay C. Goldman
|
/s/
Mary H. Williams
|
|
|
Jay
C. Goldman
|
Mary
H. Williams
|
|
|
Director
|
Director
|
|
-26-
EXHIBIT
INDEX
The
following exhibits are filed herewith or are incorporated herein by
reference.
Exhibit Description
|
3(a)
|
Articles of Incorporation of
City Holding Company (attached to, and incorporated by reference
from, Amendment No. 1 to City Holding Company’s Registration Statement on
Form S-4, Registration No. 2-86250, filed November 4, 1983 with the
Securities and Exchange
Commission).
|
|
3(b)
|
Articles of Amendment to the
Articles of Incorporation of City Holding Company, dated March 6,
1984 (attached to, and incorporated by reference from, City Holding
Company's Form 8-K Report dated March 7, 1984, and filed with the
Securities and Exchange Commission on March 22,
1984).
|
|
3(c)
|
Articles of Amendment to the
Articles of Incorporation of City Holding Company, dated March 4,
1986 (attached to, and incorporated by reference from, City Holding
Company's Form 10-K Annual Report for the year ended December 31, 1986,
filed March 31, 1987 with the Securities and Exchange
Commission).
|
|
3(d)
|
Articles of Amendment to the
Articles of Incorporation of City Holding Company, dated September
29, 1987 (attached to and incorporated by reference from, City Holding
Company's Registration Statement on Form S-4, Registration No. 33-23295,
filed with the Securities and Exchange Commission on August 3,
1988).
|
|
3(e)
|
Articles of Amendment to the
Articles of Incorporation of City Holding Company, dated May 6,
1991 (attached to, and incorporated by reference from, City Holding
Company's Form 10-K Annual Report for the year ended December 31, 1991,
filed March 17, 1992 with the Securities and Exchange
Commission).
|
|
3(f)
|
Articles of Amendment to the
Articles of Incorporation of City Holding Company, dated May 7,
1991 (attached to, and incorporated by reference from, City Holding
Company's Form 10-K Annual Report for the year ended December 31, 1991,
filed March 17, 1992 with the Securities and Exchange
Commission).
|
|
3(g)
|
Articles of Amendment to the
Articles of Incorporation of City Holding Company, dated August 1,
1994 (attached to, and incorporated by reference from, City Holding
Company's Form 10-Q Quarterly Report for the quarter ended September 30,
1994, filed November 14, 1994 with the Securities and Exchange
Commission).
|
|
3(h)
|
Articles of Amendment to the
Articles of Incorporation of City Holding Company, dated December
9, 1998 (attached to, and incorporated by reference from, City Holding
Company’s Form 10-K Annual Report for the year ended December 31, 1998,
filed March 31, 1999 with the Securities and Exchange
Commission).
|
|
3(i)
|
Articles of Amendment to the
Articles of Incorporation of City Holding Company, dated June 13,
2001 (attached to, and incorporated by reference from, City Holding
Company’s Registration Statement on Form 8-A, filed June 22, 2001 with the
Securities and Exchange
Commission).
|
|
3(j)
|
Articles of Amendment to the
Articles of Incorporation of City Holding Company, dated May 10,
2006 (attached to, and incorporated by reference from, City Holding
Company’s Form 10-Q, Quarterly Report for the quarter ended June 30, 2006,
filed August 9, 2006 with the Securities and Exchange
Commission).
|
|
3(k)
|
Amended and Restated Bylaws of
City Holding Company, revised February 28, 2007 (attached to, and
incorporated by reference from, City Holding Company’s Current Report on
Form 8-K filed March 1, 2007 with the Securities and Exchange
Commission).
|
|
3(l)
|
Amended and Restated Bylaws of
City Holding Company, revised February 24, 2010 (attached to, and
incorporated by reference from, City Holding Company’s Current Report on
Form 8-K filed March 1, 2010 with the Securities and Exchange
Commission).
|
-27-
|
4(a)
|
Rights Agreement, dated
as of June 13, 2001 (the “Rights Agreement”), between City Holding Company
and SunTrust Bank, as Rights Agent (attached to, and incorporated by
reference from, City Holding Company’s Registration Statement on Form 8-A,
filed June 22, 2001 with the Securities and Exchange
Commission).
|
|
4(b)
|
Amendment No. 1 to the Rights
Agreement dated as of November 30, 2005 (attached to, and
incorporated by reference from City Holding Company’s Amendment No. 1 on
Form 8-A, filed December 21, 2005, with the Securities and Exchange
Commission).
|
|
|
10(a)
|
Directors’ Deferred
Compensation Plan for the Directors of the Bank of Raleigh, dated
January 1987 (attached to and incorporated by reference from, City Holding
Company’s Form 10-K Annual Report for the year ended December 31, 2004,
filed March 2, 2005 with the Securities and Exchange
Commission).
|
|
10(b)
|
Form of Deferred Compensation
Agreement for the Directors of the National Bank of Summers, dated
January 15, 1987 (attached to and incorporated by reference
from, City Holding Company’s Form 10-K Annual Report for the year ended
December 31, 2004, filed March 2, 2005 with the Securities and Exchange
Commission).
|
|
10(c)
|
City Holding Company’s 1993
Stock Incentive Plan (attached to, and incorporated by reference
from, Exhibit 4.1 to City Holding Company’s Registration Statement on Form
S-8, Registration No. 333-87667, filed with the Securities and Exchange
Commission on September 23, 1999).
|
|
10(d)
|
Amendment No. 1 to City Holding
Company’s 1993 Stock Incentive Plan (attached to, and incorporated
by reference from, Exhibit 4.2 to City Holding Company’s Registration
Statement on Form S-8, Registration No. 333-87667, filed with the
Securities and Exchange Commission on September 23,
1999).
|
|
10(e)
|
Amendment No. 2 to City Holding
Company’s 1993 Stock Incentive Plan (attached to, and incorporated
by reference from, City Holding Company’s Form 10-Q Quarterly Report for
the quarter ended June 30, 2002, filed August 14, 2002 with the Securities
and Exchange Commission).
|
|
10(f)
|
City Holding Company’s 2003
Incentive Plan (attached to, and incorporated by reference from,
City Holding Company’s Definitive Proxy Statement, filed March 21, 2003
with the Securities and Exchange
Commission).
|
|
10(g)
|
Form of Employment
Agreement, dated as of July 25, 2007, by and between City Holding
Company and Charles R. Hageboeck, Ph.D. (attached to, and incorporated by
reference from, City Holding Company’s Current Report on Form 8-K, filed
July 31, 2007 with the Securities and Exchange
Commission).
|
|
10(h)
|
Form of Employment
Agreement, dated as of July 25, 2007, by and between City Holding
Company and Craig G. Stilwell (attached to, and incorporated by reference
from, City Holding Company’s Current Report on Form 8-K, filed July 31,
2007 with the Securities and Exchange
Commission).
|
|
10(i)
|
Form of Change of Control
Agreement, dated February 1, 2005, by and between City Holding
Company and David L. Bumgarner (attached to and incorporated by reference
from, City Holding Company’s Form 10-K Annual Report for the year ended
December 31, 2004, filed March 2, 2005 with the Securities and Exchange
Commission).
|
|
10(j)
|
Form of Change in Control and
Termination Agreement, dated June 28, 2004, by and between City
Holding Company and John A. DeRito (attached to, and incorporated by
reference from, City Holding Company’s Form 10-K Annual Report for the
year ended December 31, 2005, filed March 7, 2006 with the Securities and
Exchange Commission).
|
|
10(k)
|
Amended and Restated
Declaration of Trust City Holding Capital Trust III, dated as of March
27, 2008 (attached and incorporated by reference from, City Holding
Company’s Form 10Q, Quarterly Report for the period ended March 31, 2008
with the Securities and Exchange
Commission).
|
-28-
|
10(l)
|
Junior Subordinated
Indenture, dated as of March
27, 2008, between City Holding Company and Wells Fargo, National
Association, as Trustee (attached and incorporated by reference from, City
Holding Company’s Form 10Q, Quarterly Report for the period ended March
31, 2008 with the Securities and Exchange
Commission).
|
|
10(m)
|
City Holding Company Guarantee
Agreement, dated as of March
27, 2008 (attached and incorporated by reference from, City Holding
Company’s Form 10Q, Quarterly Report for the period ended March 31, 2008
with the Securities and Exchange
Commission).
|
|
13
|
Portions
of City Holding Company Annual Report to Shareholders for Year Ended
December 31, 2009.
|
|
21
|
Subsidiaries
of City Holding Company
|
|
23
|
Consent
of Ernst & Young LLP, Independent Registered Public Accounting
Firm
|
24 Power
of Attorney (included on the signature page hereof)
|
31(a)
|
Certification
pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934, as
adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 by
Charles R. Hageboeck, Ph.D.
|
|
31(b)
|
Certification
pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934, as
adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 by David
L. Bumgarner
|
|
32(a)
|
Certification
pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of
the Sarbanes-Oxley Act of 2002 by Charles R. Hageboeck,
Ph.D.
|
|
32(b)
|
Certification
pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of
the Sarbanes-Oxley Act of 2002 by David L.
Bumgarner
|
-29-