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8-K - FORM 8-K - Northfield Bancorp, Inc. | y89321e8vk.htm |
Exhibit 99.1
Company Contact:
Steven M. Klein
Chief Financial Officer
Tel: (732) 499-7200 ext. 2510
Steven M. Klein
Chief Financial Officer
Tel: (732) 499-7200 ext. 2510
FOR IMMEDIATE RELEASE
NORTHFIELD BANCORP, INC. ANNOUNCES
FOURTH QUARTER AND YEAR END 2010 RESULTS
FOURTH QUARTER AND YEAR END 2010 RESULTS
NOTABLE ITEMS INCLUDE:
| EARNINGS PER SHARE INCREASED 17.9% TO $0.33, FOR THE YEAR ENDED DECEMBER 31, 2010, AS COMPARED TO $0.28 PER SHARE FOR THE YEAR ENDED DECEMBER 31, 2009. NET INCOME WAS $0.09 PER SHARE, FOR THE QUARTER ENDED DECEMBER 31, 2010, COMPARED TO $0.10 PER SHARE FOR THE SAME QUARTER IN 2009 | ||
| NET INTEREST INCOME INCREASED 9.7% FOR THE YEAR AND 4.8% OVER THE COMPARABLE QUARTER OF 2009 | ||
| LOANS HELD FOR INVESTMENT, NET, INCREASED 13.5% FOR THE YEAR AND 3.1% IN THE FOURTH QUARTER AS COMPARED TO SEPTEMBER 30, 2010 | ||
| NET LOAN CHARGE-OFFS FOR THE YEAR REPRESENTED 0.47% OF AVERAGE LOANS WHILE THE ALLOWANCE FOR LOAN LOSSES INCREASED TO 2.64% OF TOTAL LOANS AT YEAR END | ||
| NONPERFORMING LOANS TOTAL $60.9 MILLION COMPARED TO $55.4 MILLION AT SEPTEMBER 30, 2010, AND $41.8 MILLION AT DECEMBER 31, 2009 | ||
| ACCRUING LOANS 30 TO 89 DAYS DELINQUENT DECLINED 43.7% TO $19.8 MILLION AT YEAR END AS COMPARED TO $35.2 MILLION AT SEPTEMBER 30, 2010 | ||
| SECOND BROOKLYN BRANCH OPENED WITH THREE ADDITIONAL BROOKLYN BRANCHES UNDER CONSTRUCTION | ||
| QUARTERLY CASH DIVIDEND OF $0.05 PER SHARE DECLARED ON COMMON STOCK |
Avenel,
New Jersey, January 27, 2011....Northfield Bancorp, Inc. (NasdaqGS:NFBK-News), the holding
company for Northfield Bank, reported basic and diluted earnings per common share of $0.09 and
$0.10 for the quarters ended December 31, 2010 and 2009, respectively, and basic and diluted
earnings per share of $0.33 and $0.28 for the years ended December 31, 2010 and 2009, respectively.
Net income for the year ended December 31, 2010 included an after-tax charge of $1.2 million, or
$0.03 per share, for costs related to the Company postponing its second-step stock offering
announced in September 2010. In addition, net income for the year ended December 31, 2010 was
positively affected by the reversal of deferred tax liabilities related to state bad debt reserves
of approximately $738,000, or $0.02 per share, as the result of a change in New York state tax law
enacted in September 2010.
Commenting on the annual and fourth quarter results, John W. Alexander, the Companys Chairman and
Chief Executive Officer noted, We continue to generate strong results with an almost 18% increase
in earnings per share for the year notwithstanding a significant charge related to the postponement
of our second step stock offering. Our profitability is driven by solid loan growth and diligence
in controlling interest and other operating costs. Loans 30 to 89 days delinquent and still
accruing declined almost 44% in the fourth quarter as compared to the trailing quarter. Our
capital and liquidity remain strong, and we believe we are positioned well to execute on our
strategic plan and benefit from increases in interest rates.
Mr. Alexander continued, I am pleased to announce that the Board of Directors has declared a
quarterly cash dividend of $0.05 per common share, payable on February 23, 2011, to stockholders of
record as of February 9, 2011.
-1-
Financial Condition
Total assets increased $244.9 million, or 12.2%, to $2.2 billion at December 31, 2010, from $2.0
billion at December 31, 2009. The increase was primarily attributable to increases in loans held
for investment, net, of $98.3 million, or 13.5%, and securities of $111.5 million, or 9.8%. In
addition, bank owned life insurance increased $31.1 million, primarily resulting from the purchase
of $28.8 million of insurance policies during the year ended December 31, 2010, coupled with $2.3
million of income earned on bank owned life insurance for the year ended December 31, 2010.
Loans held for investment, net, totaled $827.6 million at December 31, 2010, as compared to $729.3
million at December 31, 2009. The increase was primarily in multi-family real estate loans, which
increased $105.2 million, or 59.0%, to $283.6 million at December 31, 2010, from $178.4 million at
December 31, 2009. Commercial real estate loans increased $11.5 million, or 3.5%, to $339.3
million, insurance premium loans increased $4.1 million, or 10.2%, to $44.5 million, and home
equity loans increased $2.0 million, or 7.7%, to $28.1 million at December 31, 2010. These
increases were partially offset by decreases in residential, land and construction, and commercial
and industrial loans.
The Companys securities portfolio totaled $1.3 billion at December 31, 2010, as compared to $1.1
billion at December 31, 2009, an increase of $111.5 million, or 9.8%. At December 31, 2010, $982.9
million of the portfolio consisted of residential mortgage-backed securities issued or guaranteed
by Fannie Mae, Freddie Mac, or Ginnie Mae. The Company also held residential mortgage-backed
securities not guaranteed by Fannie Mae, Freddie Mac, or Ginnie Mae, referred to as private label
securities. The private label securities had an amortized cost of $93.6 million and an estimated
fair value of $97.3 million at December 31, 2010. These private label securities were in a net
unrealized gain position of $3.7 million at December 31, 2010, consisting of gross unrealized gains
of $4.5 million and gross unrealized losses of $788,000. In addition to the above mortgage-backed
securities, the Company held $121.8 million in securities issued by corporate entities which were
all rated investment grade at December 31, 2010.
Of the $97.3 million of private label securities, two securities with an estimated fair value of
$10.1 million (amortized cost of $10.9 million) were rated less than AAA at December 31, 2010. Of
the two securities, one had an estimated fair value of $4.4 million (amortized cost of $4.4
million) and was rated CC, and the other had an estimated fair value of $5.7 million (amortized
cost of $6.5 million) and was rated Caa2. During the quarter ended September 30, 2010, the Company
recognized other-than-temporary impairment charges of $962,000 on the $5.7 million security that
was rated Caa2. Since management does not have the intent to sell the security, and believes it is
more likely than not that the Company will not be required to sell the security, before its
anticipated recovery, the credit component of $154,000 was recognized in earnings for the quarter
ended September 30, 2010, and the non-credit component of $808,000 was recorded as a component of
accumulated other comprehensive income, net of tax. The Company continues to receive principal and
interest payments in accordance with the contractual terms of each of these securities. Management
has evaluated, among other things, delinquency status, location of collateral, estimated prepayment
speeds, and the estimated default rates and loss severity in liquidating the underlying collateral
for each of these securities. As a result of managements evaluation of these securities, the
Company believes that unrealized losses at December 31, 2010, are temporary, and as such, are
recorded as a component of accumulated other comprehensive income, net of tax.
Total liabilities increased to $1.9 billion at December 31, 2010, from $1.6 billion at December 31,
2009. The increase was primarily attributable to an increase in deposits of $56.0 million, or
4.3%, an increase in borrowings of $111.8 million, or 40.0%, and an increase of $70.7 million in
amounts due to securities brokers. The increase in deposits for the year ended December 31, 2010,
was due in part to an increase of $13.7 million in short-term certificates of deposit originated
through the CDARS® Network. The Company utilizes this funding supply as a cost
effective alternative to other short-term funding sources. In addition, money market deposits and
transaction accounts increased $99.0 million and $14.7 million, respectively, from December 31,
2009 to December 31, 2010. These increases were partially offset by a decrease of $31.4 million in
savings deposits and a decrease of $40.0 million in certificates of deposit (issued by the Bank)
over the same time period. The Company continues to focus on its marketing and pricing of its
products, which it believes promotes longer-term customer relationships. The increase in
borrowings was primarily the result of the Company increasing longer-term borrowings, taking
advantage of, and locking in, lower interest rates, partially offset by maturities during the year
ended December 31, 2010. The increase in due to securities brokers was the result of securities
purchases occurring prior to December 31, 2010, and settling after year end.
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Total stockholders equity increased to $396.7 million at December 31, 2010, from $391.5 million at
December 31, 2009. The increase was primarily attributable to net income of $13.8 million for the
year ended December 31, 2010, and an increase of $3.4 million in additional paid-in capital
primarily related to the recognition of compensation expense associated with equity awards. These
increases were partially offset by $8.1 million in stock repurchases, the payment of approximately
$3.3 million in cash dividends, and a decrease in accumulated other comprehensive income of $1.2
million for the year ended December 31, 2010.
Northfield Banks (the Companys wholly-owned subsidiary) Tier 1 (core) capital ratio was
approximately 13.43%, at December 31, 2010. The Banks total risk-based capital ratio was
approximately 27.39% at the same date. These ratios continue to significantly exceed the required
regulatory capital ratios necessary to be considered well capitalized under current federal
capital regulations. Northfield Bancorp, Incs consolidated average total equity as a percentage
of average total assets was 18.81% for the year ended December 31, 2010, as compared to 20.82% for
the year ended December 31, 2009.
Asset Quality
Nonperforming loans totaled $60.9 million (7.4% of total loans) at December 31, 2010, as compared
to $55.4 million (6.9% of total loans) at September 30, 2010, $51.5 million (6.7% of total loans)
at June 30, 2010, $50.0 million (6.8% of total loans) at March 31, 2010, and $41.8 million (5.7% of
total loans) at December 31, 2009. The following table also shows, for the same dates, troubled
debt restructurings on which interest is accruing, and accruing loans delinquent 30 to 89 days
(dollars in thousands).
December 31, | September 30, | June 30, | March 31, | December 31, | ||||||||||||||||
2010 | 2010 | 2010 | 2010 | 2009 | ||||||||||||||||
Non-accruing loans |
$ | 39,303 | 37,882 | 34,007 | 31,248 | 30,914 | ||||||||||||||
Non-accruing loans subject to
restructuring agreements |
19,978 | 17,261 | 17,417 | 13,090 | 10,717 | |||||||||||||||
Total non-accruing loans |
59,281 | 55,143 | 51,424 | 44,338 | 41,631 | |||||||||||||||
Loans 90 days or more past due
and still accruing |
1,609 | 248 | 77 | 5,710 | 191 | |||||||||||||||
Total non-performing loans |
60,890 | 55,391 | 51,501 | 50,048 | 41,822 | |||||||||||||||
Other real estate owned |
171 | 171 | 1,362 | 1,533 | 1,938 | |||||||||||||||
Total non-performing assets |
$ | 61,061 | 55,562 | 52,863 | 51,581 | 43,760 | ||||||||||||||
Loans subject to restructuring
agreements and still accruing |
$ | 11,198 | 11,218 | 10,708 | 8,817 | 7,250 | ||||||||||||||
Accruing
loans 30 to 89 days delinquent |
$ | 19,798 | 35,190 | 30,619 | 38,371 | 28,283 |
Total non-accruing loans increased $4.1 million, to $59.3 million at December 31, 2010, from
$55.1 million at September 30, 2010. This increase was primarily attributable to the following
loan types being placed on non-accrual status during the quarter ended December 31, 2010: $4.7
million of commercial real estate loans, $338,000 of multifamily loans, and $235,000 of
construction and land loans. The above increases in non-accruing loans during the quarter ended
December 31, 2010, are net of charge-offs of $111,000, and have $305,000 in specific reserves
allocated to them at December 31, 2010. These increases were partially offset by a $25,000
one-to-four family residential loan being paid off during the quarter ended December 31, 2010, an
additional $977,000 in charge-offs recorded on existing non-accrual loans, and principal paydowns
of approximately $181,000. Non-accruing loans subject to restructuring agreements totaled $20.0
million and $10.7 million at December 31, 2010 and 2009, respectively. Loans subject to
restructuring agreements, and still accruing totaled $11.2 million and $7.3 million at December 31,
2010 and 2009, respectively. During the year ended December 31, 2010, we entered into ten troubled
debt restructuring agreements, of which $4.0 million and $11.1 million were classified as accruing
and non-accruing, respectively, at December 31, 2010. At December 31, 2010, $23.5 million, or
75.4% of loans subject to restructuring agreements were performing in accordance with their
restructured terms. All of the $11.2 million of accruing troubled debt restructurings, and $12.3
million of the $20.0 million of non-accruing troubled debt restructurings, were performing in
accordance with their restructured terms.
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Loans 90 days or more past due and still accruing increased to $1.6 million from $248,000 at September
30, 2010. The increase is primarily due to two one-to-four family residential loans that are
considered well secured.
Generally, loans are placed on non-accrual status when they become 90 days or more delinquent, and
remain on non-accrual status until they are brought current, have a minimum of six months of
performance under the loan terms, and factors indicating reasonable doubt about the timely
collection of payments no longer exist. Therefore, loans may be current in accordance with their
loan terms, or may be less than 90 days delinquent, and still be on a non-accruing status.
The following tables detail the delinquency status of non-accruing loans at December 31, 2010 and
December 31, 2009 (dollars in thousands).
December 31, 2010 | ||||||||||||||||
Days Past Due | ||||||||||||||||
0 to 29 | 30 to 89 | 90 or more | Total | |||||||||||||
Real estate loans: |
||||||||||||||||
Commercial |
$ | 13,679 | 15,050 | 17,659 | 46,388 | |||||||||||
One -to- four family
residential |
135 | 770 | 370 | 1,275 | ||||||||||||
Construction and land |
2,152 | 1,860 | 1,110 | 5,122 | ||||||||||||
Multifamily |
1,824 | 927 | 2,112 | 4,863 | ||||||||||||
Home equity and lines
of credit |
| | 181 | 181 | ||||||||||||
Commercial and
industrial loans |
| 267 | 1,056 | 1,323 | ||||||||||||
Insurance premium loans |
| | 129 | 129 | ||||||||||||
Total non-accruing loans |
$ | 17,790 | 18,874 | 22,617 | 59,281 | |||||||||||
December 31, 2009 | ||||||||||||||||
Days Past Due | ||||||||||||||||
0 to 29 | 30 to 89 | 90 or more | Total | |||||||||||||
Real estate loans: |
||||||||||||||||
Commercial |
$ | 2,585 | 10,480 | 15,737 | 28,802 | |||||||||||
One -to- four family
residential |
| 392 | 1,674 | 2,066 | ||||||||||||
Construction and land |
5,864 | | 979 | 6,843 | ||||||||||||
Multifamily |
| 530 | 1,589 | 2,119 | ||||||||||||
Home equity and lines
of credit |
62 | | | 62 | ||||||||||||
Commercial and
industrial loans |
1,470 | | 269 | 1,739 | ||||||||||||
Insurance premium loans |
| | | | ||||||||||||
Total non-accruing loans |
$ | 9,981 | 11,402 | 20,248 | 41,631 | |||||||||||
Loans 30 to 89 days delinquent and on accrual status at December 31, 2010, totaled $19.8 million, a
decrease of $15.4 million, from the September 30, 2010, balance of $35.2 million. The following
table sets forth delinquencies for accruing loans by type and by amount at December 31, 2010
(dollars in thousands).
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Delinquent Accruing Loans | ||||||||||||
30 to 89 Days | 90 Days and Over | Total | ||||||||||
Real estate loans: |
||||||||||||
Commercial |
$ | 8,970 | $ | | $ | 8,970 | ||||||
One- to four-family
residential |
2,575 | 1,108 | 3,683 | |||||||||
Construction and land |
499 | 404 | 903 | |||||||||
Multifamily |
6,194 | | 6,194 | |||||||||
Home equity and lines
of credit |
262 | 59 | 321 | |||||||||
Commercial and
industrial loans |
536 | 38 | 574 | |||||||||
Insurance premium loans |
660 | | 660 | |||||||||
Other loans |
102 | | 102 | |||||||||
Total |
$ | 19,798 | $ | 1,609 | $ | 21,407 | ||||||
The following table details the amounts and categories of the troubled debt restructurings by
loan type as of December 31, 2010 and December 31, 2009 (dollars in thousands).
At December 31, 2010 | At December 31, 2009 | |||||||||||||||
Non-Accruing | Accruing | Non-Accruing | Accruing | |||||||||||||
Troubled debt restructurings: |
||||||||||||||||
Real estate loans: |
||||||||||||||||
Commercial |
$ | 13,138 | $ | 7,879 | $ | 3,960 | $ | 5,499 | ||||||||
One- to four-family residential |
| 1,750 | | | ||||||||||||
Construction and land |
4,012 | | 5,726 | 1,751 | ||||||||||||
Multifamily |
2,327 | 1,569 | 530 | | ||||||||||||
Commercial and industrial |
501 | | 501 | | ||||||||||||
Total |
$ | 19,978 | $ | 11,198 | $ | 10,717 | $ | 7,250 | ||||||||
Other real estate owned amounted to $171,000 at December 31, 2010, as compared to $1.9 million
at December 31, 2009. This decrease was attributable to downward valuation adjustments of $146,000
recorded against the carrying balances of the properties in 2010, reflecting deterioration in
estimated fair values, coupled with the sale of other real estate owned properties.
Results of Operations
Quarter ended December 31, 2010 as compared to Quarter Ended December 31, 2009
Net income decreased $199,000, or 4.9%, to $3.8 million for the quarter ended December 31, 2010, as
compared to $4.0 million for the quarter ended December 31, 2009, due primarily to an increase of
$953,000 in non-interest expense and an increase of $386,000 in the provision for loan losses,
partially offset by an increase of $729,000 in net interest income, an increase of $209,000 in
non-interest income, and a decrease of $202,000 in income tax expense.
Net interest income increased $729,000, or 4.8%, due primarily to average interest earning assets
increasing $120.4 million, or 6.2%, partially offset by a decrease in the net interest margin of
five basis points, or 1.6%, for the quarter ended December 31, 2010, compared to the quarter ended
December 31, 2009. The average yield earned on interest earning assets decreased 35 basis points,
or 7.7%, to 4.21% for the quarter ended December 31, 2010, compared to 4.56% for the quarter ended
December 31, 2009. This change was partially offset by a 46 basis point decrease in the average
rate paid on interest-bearing liabilities over the comparable period from 1.87% to 1.41%. The
general decline in yields was due to the overall low interest rate environment and was driven by
decreases in yields earned on mortgage-backed securities, as principal repayments were reinvested
into lower yielding securities. The increase in average interest earning assets was due primarily
to an increase in average loans outstanding of $99.3 million, and $80.6 million in mortgage-backed
securities, partially offset by decreases in
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other securities and interest-earning assets in other financial institutions. Other securities
consist primarily of investment-grade shorter-term corporate bonds, and government-sponsored
enterprise bonds.
Non-interest income increased $209,000, or 13.6%, to $1.8 million for the quarter ended December
31, 2010, as compared to $1.5 million for the quarter ended December 31, 2009, primarily as a
result of an increase of $333,000 of income earned on bank owned life insurance, generated by
increased cash surrender values, primarily from $28.8 million in additional bank owned life
insurance purchased during the year ended December 31, 2010. This increase was partially offset by
a decrease of $129,000 in gains on securities transactions, net, for the quarter ended December 31,
2010, compared to the quarter ended December 31, 2009.
Non-interest expense increased $953,000, or 10.6%, for the quarter ended December 31, 2010, as
compared to the quarter ended December 31, 2009, due primarily to compensation and employee
benefits expense increasing $904,000, which resulted primarily from increases in full-time
equivalent employees related to our insurance premium finance division formed in October 2009,
increased personnel in branches and operations, higher health care costs, and to a lesser extent,
salary adjustments effective January 1, 2010.
The provision for loan losses was $2.0 million for the quarter ended December 31, 2010; an increase
of $386,000, or 24.6%, from the $1.6 million provision recorded in the quarter ended December 31,
2009. The increase in the provision for loan losses in the current quarter was due primarily to
increases in total loans, partially offset by changes in the composition of our loan portfolio to
lower risk rated multi-family loans. During the quarter ended December 31, 2010, the Company
recorded $879,000 of charge-offs on two non-accruing multifamily loans and $209,000 in charge-offs
on two non-accruing commercial real estate loans, based on the receipt of current appraisals. Net
charge-offs for the quarter ended December 31, 2010, were $1.1 million, as compared to $354,000 for
the quarter ended December 31, 2009.
The Company recorded income tax expense of $2.0 million and $2.2 million for the quarters ended
December 31, 2010 and 2009, respectively. The effective tax rate for the quarter ended December
31, 2010, was 34.0%, as compared to 35.1% for the quarter ended December 31, 2009. The decrease in
the effective tax rate was the result of an increase in permanent differences primarily as a result
of an increase in bank owned life insurance income.
Year ended December 31, 2010 as compared to Year Ended December 31, 2009
Net income increased $1.7 million, or 14.2%, to $13.8 million for the year ended December 31, 2010,
as compared to $12.1 million for the year ended December 31, 2009, due primarily to an increase of
$5.5 million in net interest income, an increase of $1.4 million in non-interest income, and a
decrease of $248,000 in income tax expense, partially offset by an increase of $4.4 million in
non-interest expense, and an increase of $1.0 million in provision for loan losses.
Net interest income increased $5.5 million, or 9.7%, due primarily to interest earning assets
increasing $213.0 million, or 11.9%, partially offset by a decrease in the net interest margin of
six basis points, or 1.9%, over the prior year comparable period. The net interest margin
decreased for the year ended December 31, 2010, as the average yield earned on interest earning
assets decreased, which was partially offset by a decrease in the average rate paid on
interest-bearing liabilities. The general decline in yields was due to the overall low interest
rate environment and was driven by decreases in yields earned on mortgage-backed securities, as
principal repayments were reinvested into lower yielding securities. The decline in yield on
interest-earning assets was also due to declining yields on other securities and interest-earning
deposits in other financial institutions. These decreases were partially offset by an increase in
yield earned on loans due primarily to fewer loans migrating to non-accrual status during the
fourth quarter of 2010, as compared to the amount of loans that migrated to non-accrual status
during the fourth quarter of 2009. The increase in average interest earning assets was due
primarily to an increase in average loans outstanding of $121.7 million, other securities of $112.9
million, and mortgage-backed securities of $16.2 million, being partially offset by decreases in
interest-earning assets in other financial institutions. Other securities consist primarily of
investment-grade corporate bonds, and government-sponsored enterprise bonds.
Non-interest income increased $1.4 million, or 26.9%, primarily as a result of an increase of
$962,000 in gains on securities transactions, net for the year ended December 31, 2010, as compared
to the year ended December 31, 2009. The Company recognized $1.9 million in gains on securities
transactions during the year ended December 31, 2010, as compared to $891,000 in gains on
securities transactions during the year ended December 31, 2009. Securities gains during the year
-6-
ended December 31, 2010, included gross realized gains of $1.3 million primarily from the sale of
mortgage-backed securities, coupled with securities gains of $597,000 related to the Companys
trading portfolio. During the year ended December 31, 2009, securities gains included gross
realized gains of $299,000 primarily from the sale of mortgage-backed securities, coupled with
securities gains of $592,000 related to the Companys trading portfolio. The trading portfolio is
utilized to fund the Companys deferred compensation obligation to certain employees and directors
of the Company. The participants of this plan, at their election, defer a portion of their
compensation. Gains and losses on trading securities have no effect on net income since
participants benefit from, and bear the full risk of, changes in the trading securities market
values. Therefore, the Company records an equal and offsetting amount in non-interest expense,
reflecting the change in the Companys obligations under the plan. The Company routinely sells
securities for reasons that include smaller balance securities become cost prohibitive to carry,
and when market pricing presents, in managements assessment, an economic benefit that outweighs
holding such security.
Non-interest income also was positively affected by a $524,000, or 29.9%, increase in income on
bank owned life insurance for the year ended December 31, 2010, as compared to the year ended
December 31, 2009. The Company also recognized approximately $197,000 of income on the sale of
fixed assets during the year ended December 31, 2010.
Non-interest expense increased $4.4 million, or 12.9%, for the year ended December 31, 2010, as
compared to the year ended December 31, 2009, due primarily to the expensing of approximately $1.8
million in costs incurred on the Companys postponed, second-step stock offering, and an increase
of $2.2 million, or 12.8%, in compensation and employee benefits expense. Compensation and
employee benefits expense increased primarily due to increases in full time equivalent employees
related to additional branch and operations personnel, as well as incremental personnel from our
insurance premium finance division formed in October 2009. Occupancy expense increased $547,000,
or 11.9%, over the same time period, primarily due to increases in rent and amortization of
leasehold improvements relating to new branches and the renovation of existing branches. In
addition, other non-interest expense also increased $536,000, or 15.7%, from the year ended
December 31, 2009 to the year ended December 31, 2010. This increase is primarily attributable to
operating expenses of the insurance premium finance division. These increases in non-interest
expense were partially offset by a decrease of $515,000 in FDIC insurance expense. FDIC insurance
expense for the year ended December 31, 2009 included $770,000 related to an FDIC special
assessment.
The provision for loan losses was $10.1 million for the year ended December 31, 2010, an increase
of $1.1 million, or 11.6%, from the $9.0 million provision recorded for the year ended December 31,
2009. The increase in the provision for loan losses was due primarily to increases in total loans,
the change in the composition of our loan portfolio, and increases in general loss factors, due
primarily to higher levels of charge-offs. The increases in the general loss factors utilized in
managements estimate of credit losses inherent in the loan portfolio were also the result of
continued deterioration of the local economy. Net charge-offs for the year ended December 31,
2010, were $3.7 million, as compared to $2.4 million for the year ended December 31, 2009.
The Company recorded income tax expense of $6.4 million and $6.6 million for the years ended
December 31, 2010 and 2009, respectively. The effective tax rate for the year ended December 31,
2010, was 31.6%, as compared to 35.4% for the year ended December 31, 2009. The decrease in the
effective tax rate was primarily the result of the reversal of deferred tax liabilities related to
state bad debt reserves of approximately $738,000 resulting from the enactment of new State of New
York tax laws during the year ended December 31, 2010, and higher levels of tax exempt income from
bank owned life insurance.
About Northfield Bank
Northfield Bank, founded in 1887, operates 20 full service banking offices in Staten Island and
Brooklyn, New York and Middlesex and Union counties, New Jersey. For more information about
Northfield Bank, please visit www.eNorthfield.com.
Forward-Looking Statements: This release may contain certain forward looking statements
within the meaning of the Private Securities Litigation Reform Act of 1995, and may be identified
by the use of such words as may, believe, expect, anticipate, should, plan, estimate,
predict, continue, and potential or the negative of these terms or other comparable
terminology. Examples of forward-looking statements include, but are not limited to, estimates
with respect to the financial condition, results of operations and business of Northfield Bancorp,
Inc. Any or all of the forward-looking statements in this release and in any other public
statements made by Northfield Bancorp, Inc. may turn out to be wrong. They can be affected by
-7-
inaccurate assumptions Northfield Bancorp, Inc. might make or by known or unknown risks and
uncertainties as described in our SEC filings, including, but not limited to, those related to
general economic conditions, particularly in the market areas in which the Company operates,
competition among depository and other financial institutions, changes in laws or government
regulations or policies affecting financial institutions, including changes in regulatory fees and
capital requirements, inflation and changes in the interest rate environment that reduce our
margins or reduce the fair value of financial instruments, our ability to successfully integrate
acquired entities, if any, and adverse changes in the securities markets. Consequently, no
forward-looking statement can be guaranteed. Northfield Bancorp, Inc. does not intend to update
any of the forward-looking statements after the date of this release, or conform these statements
to actual events.
(Tables to follow)
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NORTHFIELD BANCORP, INC.
SELECTED CONSOLIDATED FINANCIAL AND OTHER DATA
(Dollars in thousands, except per share amounts) (unaudited)
SELECTED CONSOLIDATED FINANCIAL AND OTHER DATA
(Dollars in thousands, except per share amounts) (unaudited)
At | At | |||||||
December 31, 2010 | December 31, 2009 | |||||||
Selected Financial Condition Data: |
||||||||
Total assets |
$ | 2,247,167 | $ | 2,002,274 | ||||
Cash and cash equivalents |
43,852 | 42,544 | ||||||
Trading securities |
4,095 | 3,403 | ||||||
Securities available for sale, at estimated fair value |
1,244,313 | 1,131,803 | ||||||
Securities held to maturity |
5,060 | 6,740 | ||||||
Loans held for investment, net |
827,591 | 729,269 | ||||||
Allowance for loan losses |
(21,819 | ) | (15,414 | ) | ||||
Net loans held for investment |
805,772 | 713,855 | ||||||
Non-performing loans(1) |
60,890 | 41,822 | ||||||
Other real estate owned |
171 | 1,938 | ||||||
Bank owned life insurance |
74,805 | 43,751 | ||||||
Federal Home Loan Bank of New York stock, at cost |
9,784 | 6,421 | ||||||
Borrowed funds |
391,237 | 279,424 | ||||||
Deposits |
1,372,842 | 1,316,885 | ||||||
Total liabilities |
1,850,450 | 1,610,734 | ||||||
Total stockholders equity |
$ | 396,717 | $ | 391,540 |
Quarter Ended | Year Ended | |||||||||||||||
December 31, | December 31, | |||||||||||||||
2010 | 2009 | 2010 | 2009 | |||||||||||||
Selected Operating Data: |
||||||||||||||||
Interest income |
$ | 21,774 | $ | 22,218 | $ | 86,495 | $ | 85,568 | ||||||||
Interest expense |
5,829 | 7,002 | 24,406 | 28,977 | ||||||||||||
Net interest income before provision for loan losses |
15,945 | 15,216 | 62,089 | 56,591 | ||||||||||||
Provision for loan losses |
1,958 | 1,572 | 10,084 | 9,038 | ||||||||||||
Net interest income after provision for loan losses |
13,987 | 13,644 | 52,005 | 47,553 | ||||||||||||
Non-interest income |
1,752 | 1,543 | 6,842 | 5,393 | ||||||||||||
Non-interest expense |
9,935 | 8,982 | 38,684 | 34,254 | ||||||||||||
Income before income tax expense |
5,804 | 6,205 | 20,163 | 18,692 | ||||||||||||
Income tax expense |
1,973 | 2,175 | 6,370 | 6,618 | ||||||||||||
Net income |
$ | 3,831 | $ | 4,030 | $ | 13,793 | $ | 12,074 | ||||||||
Basic earnings per share (2) |
$ | 0.09 | $ | 0.10 | $ | 0.33 | $ | 0.28 | ||||||||
Diluted earnings per share (2) |
$ | 0.09 | $ | 0.10 | $ | 0.33 | $ | 0.28 | ||||||||
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NORTHFIELD BANCORP, INC.
SELECTED CONSOLIDATED FINANCIAL AND OTHER DATA
(Dollars in thousands, except per share amounts) (unaudited)
SELECTED CONSOLIDATED FINANCIAL AND OTHER DATA
(Dollars in thousands, except per share amounts) (unaudited)
At or For the Three | ||||||||||||||||
Months Ended | At or For the Year Ended | |||||||||||||||
December 31, | December 31, | |||||||||||||||
2010 | 2009 | 2010 | 2009 | |||||||||||||
Selected Financial Ratios: |
||||||||||||||||
Performance Ratios(3) : |
||||||||||||||||
Return on assets (ratio of net income to average total assets)(5) |
0.70 | % | 0.80 | % | 0.65 | % | 0.64 | % | ||||||||
Return on equity (ratio of net income to average equity)(5) |
3.78 | 4.05 | 3.46 | 3.09 | ||||||||||||
Average equity to average total assets |
18.50 | 19.71 | 18.81 | 20.82 | ||||||||||||
Interest rate spread |
2.80 | 2.69 | 2.79 | 2.66 | ||||||||||||
Net interest margin |
3.08 | 3.13 | 3.10 | 3.16 | ||||||||||||
Efficiency ratio(4)(6) |
56.14 | 53.59 | 56.12 | 55.26 | ||||||||||||
Non-interest expense to average total assets(6) |
1.81 | 1.78 | 1.82 | 1.82 | ||||||||||||
Average interest-earning assets to average interest-bearing liabilities |
124.84 | 129.67 | 125.52 | 130.44 | ||||||||||||
Asset Quality Ratios: |
||||||||||||||||
Non-performing assets to total assets |
2.72 | 2.19 | 2.72 | 2.19 | ||||||||||||
Non-performing loans to total loans held for investment, net |
7.36 | 5.73 | 7.36 | 5.73 | ||||||||||||
Allowance for loan losses to non-performing loans |
35.83 | 36.86 | 35.83 | 36.86 | ||||||||||||
Allowance for loan losses to total loans |
2.64 | 2.11 | 2.64 | 2.11 | ||||||||||||
Annualized net charge-offs to total average loans |
0.52 | 0.20 | 0.47 | 0.37 | ||||||||||||
Provision for loan losses as a multiple of net charge-offs |
1.83 | x | 4.44 | x | 2.74 | x | 3.76 | x |
(1) | Non-performing loans consist of non-accruing loans and loans 90 days or more past due and still accruing, and are included in loans held-for-investment, net. | |
(2) | Basic net income per common share is calculated based on 41,283,220 and 41,713,862 average shares outstanding for the three months ended December 31, 2010, and December 31, 2009, respectively. Basic net income per common share is calculated based on 41,387,106 and 42,405,774 average shares outstanding for the year ended December 31, 2010, and December 31, 2009, respectively. Diluted earnings per share is calculated based on 41,573,074 and 41,949,757 average shares outstanding for the three months ended December 31, 2010 and December 31, 2009, respectively. Diluted earnings per share is calculated based on 41,669,006 and 42,532,568 average shares outstanding for the year ended December 31, 2010 and December 31, 2009, respectively. | |
(3) | Annualized when appropriate. | |
(4) | The efficiency ratio represents non-interest expense divided by the sum of net interest income and non-interest income. | |
(5) | Year ended December 31, 2010, amounts include a $1.8 million charge ($1.2 million after-tax) related to costs associated with the Companys postponed second-step offering, and a $738,000 benefit related the elimination of deferred tax liabilities associated with a change in New York state tax law. Year ended December 31, 2009, amounts include a $770,000 expense ($462,000 after-tax) related to a special FDIC deposit insurance assessment. | |
(6) | Year ended December 31, 2010, amounts include a $1.8 million charge ($1.2 million after-tax) related to costs associated with the Companys postponed second-step offering. Year ended December 31, 2009, amounts include a $770,000 expense ($462,000 after-tax) related to a special FDIC deposit insurance assessment. |
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NORTHFIELD BANCORP, INC.
ANALYSIS OF NET INTEREST INCOME
(Dollars in thousands)
ANALYSIS OF NET INTEREST INCOME
(Dollars in thousands)
For the Quarter Ended December 31, | ||||||||||||||||||||||||
2010 | 2009 | |||||||||||||||||||||||
Average | Average | Average | Average | |||||||||||||||||||||
Outstanding | Yield/ Rate | Outstanding | Yield/ Rate | |||||||||||||||||||||
Balance | Interest | (1) | Balance | Interest | (1) | |||||||||||||||||||
Interest-earning assets: |
||||||||||||||||||||||||
Loans |
$ | 812,638 | $ | 12,382 | 6.05 | % | $ | 713,356 | $ | 10,814 | 6.01 | % | ||||||||||||
Mortgage-backed securities |
983,877 | 7,854 | 3.17 | 903,297 | 9,836 | 4.32 | ||||||||||||||||||
Other securities |
223,392 | 1,406 | 2.50 | 256,541 | 1,395 | 2.16 | ||||||||||||||||||
Federal Home Loan Bank of New York stock |
7,473 | 121 | 6.42 | 6,711 | 99 | 5.85 | ||||||||||||||||||
Interest-earning deposits in financial institutions |
24,292 | 11 | 0.18 | 51,413 | 74 | 0.57 | ||||||||||||||||||
Total interest-earning assets |
2,051,672 | 21,774 | 4.21 | 1,931,318 | 22,218 | 4.56 | ||||||||||||||||||
Non-interest-earning assets |
121,085 | 71,683 | ||||||||||||||||||||||
Total assets |
2,172,757 | 2,003,001 | ||||||||||||||||||||||
Interest-bearing liabilities: |
||||||||||||||||||||||||
Savings, NOW, and money market accounts |
700,932 | 1,212 | 0.69 | 614,032 | 1,457 | 0.94 | ||||||||||||||||||
Certificates of deposit |
590,866 | 1,830 | 1.23 | 589,176 | 2,869 | 1.93 | ||||||||||||||||||
Total interest-bearing deposits |
1,291,798 | 3,042 | 0.93 | 1,203,208 | 4,326 | 1.43 | ||||||||||||||||||
Borrowed funds |
351,580 | 2,787 | 3.14 | 286,250 | 2,676 | 3.71 | ||||||||||||||||||
Total interest-bearing liabilities |
1,643,378 | 5,829 | 1.41 | 1,489,458 | 7,002 | 1.87 | ||||||||||||||||||
Non-interest bearing deposit accounts |
117,014 | 105,797 | ||||||||||||||||||||||
Accrued expenses and other liabilities |
10,407 | 13,035 | ||||||||||||||||||||||
Total liabilities |
1,770,799 | 1,608,290 | ||||||||||||||||||||||
Stockholders equity |
401,958 | 394,711 | ||||||||||||||||||||||
Total liabilities and stockholders equity |
2,172,757 | 2,003,001 | ||||||||||||||||||||||
Net interest income |
$ | 15,945 | $ | 15,216 | ||||||||||||||||||||
Net interest rate spread (2) |
2.80 | 2.69 | ||||||||||||||||||||||
Net interest-earning assets (3) |
$ | 408,294 | $ | 441,860 | ||||||||||||||||||||
Net interest margin (4) |
3.08 | % | 3.13 | % | ||||||||||||||||||||
Average interest-earning assets to
interest-bearing liabilities |
124.84 | 129.67 |
(1) | Average yields and rates for the three months ended December 31, 2010, and 2009 are annualized. | |
(2) | Net interest rate spread represents the difference between the weighted average yield on interest-earning assets and the weighted average cost of interest-bearing liabilities. | |
(3) | Net interest-earning assets represent total interest-earning assets less total interest-bearing liabilities. | |
(4) | Net interest margin represents net interest income divided by average total interest-earning assets. |
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NORTHFIELD BANCORP, INC.
ANALYSIS OF NET INTEREST INCOME
(Dollars in thousands)
ANALYSIS OF NET INTEREST INCOME
(Dollars in thousands)
For the Year Ended December 31, | ||||||||||||||||||||||||
2010 | 2009 | |||||||||||||||||||||||
Average | Average | |||||||||||||||||||||||
Outstanding | Average | Outstanding | Average | |||||||||||||||||||||
Balance | Interest | Yield/ Rate | Balance | Interest | Yield/ Rate | |||||||||||||||||||
Interest-earning assets: |
||||||||||||||||||||||||
Loans |
$ | 775,404 | $ | 46,681 | 6.02 | % | $ | 653,748 | $ | 38,889 | 5.95 | % | ||||||||||||
Mortgage-backed securities |
936,991 | 33,306 | 3.55 | 920,785 | 42,256 | 4.59 | ||||||||||||||||||
Other securities |
239,872 | 6,011 | 2.51 | 126,954 | 3,223 | 2.54 | ||||||||||||||||||
Federal Home Loan Bank of New York stock |
6,866 | 354 | 5.16 | 7,428 | 399 | 5.37 | ||||||||||||||||||
Interest-earning deposits in financial institutions |
45,951 | 143 | 0.31 | 83,159 | 801 | 0.96 | ||||||||||||||||||
Total interest-earning assets |
2,005,084 | 86,495 | 4.31 | 1,792,074 | 85,568 | 4.77 | ||||||||||||||||||
Non-interest-earning assets |
115,491 | 87,014 | ||||||||||||||||||||||
Total assets |
2,120,575 | 1,879,088 | ||||||||||||||||||||||
Interest-bearing liabilities: |
||||||||||||||||||||||||
Savings, NOW, and money market accounts |
676,334 | 5,119 | 0.76 | 566,894 | 6,046 | 1.07 | ||||||||||||||||||
Certificates of deposit |
590,445 | 8,454 | 1.43 | 509,610 | 12,168 | 2.39 | ||||||||||||||||||
Total interest-bearing deposits |
1,266,779 | 13,573 | 1.07 | 1,076,504 | 18,214 | 1.69 | ||||||||||||||||||
Borrowed funds |
330,693 | 10,833 | 3.28 | 297,365 | 10,763 | 3.62 | ||||||||||||||||||
Total interest-bearing liabilities |
1,597,472 | 24,406 | 1.53 | 1,373,869 | 28,977 | 2.11 | ||||||||||||||||||
Non-interest bearing deposit accounts |
114,450 | 99,950 | ||||||||||||||||||||||
Accrued expenses and other liabilities |
9,677 | 14,075 | ||||||||||||||||||||||
Total liabilities |
1,721,599 | 1,487,894 | ||||||||||||||||||||||
Stockholders equity |
398,976 | 391,194 | ||||||||||||||||||||||
Total liabilities and stockholders equity |
2,120,575 | 1,879,088 | ||||||||||||||||||||||
Net interest income |
$ | 62,089 | $ | 56,591 | ||||||||||||||||||||
Net interest rate spread (1) |
2.78 | 2.66 | ||||||||||||||||||||||
Net interest-earning assets (2) |
$ | 407,612 | $ | 418,205 | ||||||||||||||||||||
Net interest margin (3) |
3.10 | % | 3.16 | % | ||||||||||||||||||||
Average interest-earning assets to
interest-bearing liabilities |
125.52 | 130.44 |
(1) | Net interest rate spread represents the difference between the weighted average yield on interest-earning assets and the weighted average cost of interest-bearing liabilities. | |
(2) | Net interest-earning assets represent total interest-earning assets less total interest-bearing liabilities. | |
(3) | Net interest margin represents net interest income divided by average total interest-earning assets. |
* * * * *
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