UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
______________
FORM
8-K
______________
CURRENT
REPORT
Pursuant
to Section 13 or 15(d) of the
Securities
Exchange Act of 1934
Date
of
Report (Date of earliest event reported): January 21,
2008
 PEOPLES
BANCORP INC.
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(Exact
name of Registrant as specified in its
charter)
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Ohio
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0-16772
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31-0987416
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(State
or other jurisdiction
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(Commission
File
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(IRS
Employer
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of
incorporation)
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Number)
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Identification
No.)
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138
Putnam Street, PO Box 738
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Marietta,
Ohio
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45750-0738
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(Address
of principal executive offices)
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(Zip
Code)
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Registrant's
telephone number, including area code:
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(740)
373-3155
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Not
applicable
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(Former
name or former address, if changed since last
report)
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Check
the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions:
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Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17
CFR
240.14d-2(b))
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Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17
CFR
240.13e-4(c))
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Item
8.01 Other
Events.
On
January 21, 2008, the management of
Peoples Bancorp Inc. (“Peoples”) determined for the fourth quarter ended
December 31, 2007, Peoples will record an other-than-temporary non-cash
impairment charge of approximately $5.5 million (pre-tax) related to $23.4
million in carrying value of available-for-sale investment
securities. As a result of the $5.5 million charge, Peoples’ fourth
quarter 2007 net income after taxes will be reduced by approximately $3.6
million or $0.35 per common share, on a diluted basis. Peoples is
recording this unrealized loss as an other-than-temporary impairment in
accordance with generally accepted accounting principles.
This
charge for other-than-temporary
impairment is comprised of a $1.3 million charge related to Federal National
Mortgage Association ("Fannie Mae") preferred stock previously carried at $6.8
million, a $1.9 million charge related to Federal Home Loan Mortgage Corporation
("Freddie Mac") preferred stock previously carried at $8.5 million, a $0.1
million charge related to a single bank holding company stock held by Peoples
previously carried at $0.2 million and a $2.2 million charge related to three
collateralized debt obligation (“CDO”) investment securities previously carried
at $7.9 million.
The
Fannie Mae and Freddie Mac preferred
stocks are investment grade, high yielding fixed-rate securities that are rated
AA- and Aa3 by S&P and Moody’s, respectively. Recent capital
needs at Fannie Mae and Freddie Mac resulted in new issuances of higher yielding
preferred stocks by these two companies, and coupled with continued turmoil
in
the housing and credit markets, have resulted in declines in the market value
of
the Fannie Mae and Freddie Mac securities as well as certain financial sector
stocks.
Approximately
90% of the CDO portfolio's
collateral pools are comprised primarily of bank-issued trust preferred
securities and other debt obligations issued by financial services companies,
with the remainder comprised of trust preferred securities issued by insurance
companies and real estate investment trusts. After the above
mentioned impairment charges, the carrying value of Peoples’ CDO portfolio,
which was $8.3 million prior to the impairment charge, will total $6.1 million
of which $5.0 million still maintains BBB or BBB+ rating by Fitch and Moody's
respectively. The remaining $1.1 million are 100% bank income notes
originated in 2001 and 2002, and were never rated. Continued
liquidity and credit concerns have resulted in declines in the market value
of
CDOs.
Peoples
will announce earnings for the
quarter and year ended December 31, 2007 before the market opens on January
24,
2008 and will hold its regular quarterly earnings conference call at 11:00
am,
Eastern Time, on January 24, 2008.
2
SIGNATURE
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant
has
duly caused this report to be signed on its behalf by the undersigned hereunto
duly authorized.
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PEOPLES
BANCORP INC.
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January
22, 2008
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By:
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/s/
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CAROL
A. SCHNEEBERGER
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Carol
A. Schneeberger
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Chief
Financial Officer and Treasurer
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3