Irwin Commercial Finance Reports 70% Increase in 2006 Profit

January 30, 2007 - Irwin Financial reported that its commercial finance unit achieved record net income in 2006. Profit totaled $12.6 million for the year, a 70% increase over $7.4 million in 2005 and a record for the segment.

In the fourth quarter of 2006, Irwin Commercial Finance segment earned $3.5 million, up from $3.3 million in the third quarter. Loan and lease fundings totaled $164 million, compared to $147 million in the third quarter.

The segment's loan and lease portfolio now totals $1.1 billion, representing a 29% increase over the past year. Net interest income totaled $12.3 million during the fourth quarter and net interest margin increased to 4.77%, up from 4.27% in the prior quarter.

Credit quality remains good, the company said. The loan and lease loss provision in this segment totaled $2.1 million during the quarter, up from $1.6 million during the prior quarter. Net charge-offs decreased to $0.9 million, as compared to $1.2 million in the prior quarter. The thirty-day and greater delinquency ratio increased modestly to 0.60% at December 31, from 0.57% at September 30.

"In 2006, our commercial banking and finance businesses continued to thrive despite a difficult environment," said Will Miller, chairman and CEO of Irwin Financial. "Irwin Union Bank and Irwin Commercial Finance both achieved record net income by expanding market share, while maintaining excellent credit quality. With continued growth in these two segments and our expectation of rebuilding in our consumer mortgage segment, we expect results in 2007 to be much improved."

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