Attached files
| file | filename |
|---|---|
| 8-K - FORM 8-K - STERLING BANCORP | d8k.htm |
| EX-99.2 - EARNINGS RELEASE SLIDE SHOW - STERLING BANCORP | dex992.htm |
EXHIBIT 99.1
| Provident New York Bancorp | ||
| 400 Rella Boulevard | ||
| Montebello, NY 10901-4243 | ||
| T 845.369.8040 | ||
| News Release | F 845.369.8255 | |
| www.providentbanking.com | ||
| FOR IMMEDIATE RELEASE | Stock Symbol: PBNY | |
| July 25, 2011 | Traded on NASDAQ Global Select Market | |
| PROVIDENT BANK CONTACT: | ||
| Paul A. Maisch, EVP & Chief Financial Officer | ||
| Miranda Grimm, FVP & Controller | ||
| 845.369.8040 | ||
Provident New York Bancorp Announces
Third Quarter 2011 Earnings of $0.05 per Diluted Share
MONTEBELLO, N.Y. – July 25, 2011 – Provident New York Bancorp (NASDAQ-Global Select Market: PBNY), the parent company of Provident Bank, today announced third-quarter results for the quarter ended June 30, 2011. Net income for the quarter was $1.9 million, or $0.05 per diluted share, compared to net income of $4.8 million, or $0.12 per diluted share for same quarter last year and net income of $3.6 million, or $0.10 per diluted share for the linked quarter ended March 31, 2011. As described in more detail below gains on sales of securities and loans affected results in both comparative quarters to a greater extent than they did in the current quarter. The current quarter was also negatively impacted by $1.5 million in pre-tax costs related to the retirement of the prior CEO as well as $1.5 million in additional loan loss provisions (discussed in more detail in the credit quality section of this release). Net income for fiscal 2011 year-to-date was $12.2 million, or $0.33 per diluted share compared to $15.1 million or $0.39 per diluted share for year-to-date fiscal 2010.
President’s Comments
Jack Kopnisky, President and CEO commented, “In joining Provident, I am excited about the opportunity to put the Company on a growth track while maintaining its historic risk management culture. Provident benefits from a strong market position, low cost of deposits, long term funding sources, and a strong infrastructure to support growth. During the fourth quarter a comprehensive review of all operations and opportunities at Provident will be completed and new strategies designed to drive growth in revenues and earnings will be implemented.
The third quarter results saw several positive indicators that should support improved performance. Commercial loan originations were $125.5 million, up $38 million over the linked quarter. The commercial loan pipeline is up 48 percent over the linked quarter and up 59 percent over the same quarter of the previous year. Criticized / Classified loans declined by $13.1 million as $5.1 million in loans were upgraded and $4.3 million of these loans were paid off. However, non-performing loans increased by $10.9 million and net charge-offs increased to $4.3 million for the quarter, as a result of an ADC relationship previously classified as a performing substandard TDR being moved to non-accrual status. We remain cautious in our credit outlook as we have continued to see fluctuations in levels of net charge-offs and problem assets.”
1
Key items for the quarter
| • | Earnings were $0.07 per diluted share, excluding the after tax effect of securities gains and credit losses, the fair value adjustment of interest rate caps, and defined benefit settlement charges and charges associated with change in the CEO. This compares to $0.09 for the linked quarter and $0.12 for the third quarter of fiscal 2010. We believe these adjustments afford investors a better understanding of our core banking operations, and align more closely to the views of the investment community, which tends to adjust for more variable components of income. |
| • | Provisions for loan losses increased $1.5 million to $3.6 million compared to $2.1 million for the linked quarter, and increased $850,000 from $2.8 million for the same quarter last year. |
| • | Commercial real estate and C&I loan originations were $87.6 million compared to $63.5 million for the linked quarter and $80.2 million for the same quarter last year. |
| • | ADC and small business loan originations were $37.9 million compared to $24.1 million for the linked quarter and $50.2 million for the same quarter last year. |
| • | Net charge-offs of $4.3 million are up $1.3 million from the linked quarter and up $2.2 million from the same quarter last year. Charge-offs during the quarter included loans with $1.0 million previously provisioned for as of March 31, 2011. |
| • | Substandard loans declined $10.1 million to $103.8 million as of June 30, 2011 primarily due to upgrades to pass and the refinancing of a large relationship which reduced exposure and improved cash flows. Special mention loans decreased $3.0 million during the quarter. (For discussion of comparative periods see the credit quality section) |
| • | Non-performing loans, a subset of substandard loans, increased to $48.1 million, up $10.9 million from the linked quarter and are up $19.0 million over the same quarter in the prior year. |
Net Interest Income and Margin
Third quarter fiscal 2011 compared with third quarter fiscal 2010
Net interest income was $22.8 million for the third quarter of fiscal 2011, a decrease of $1.4 million from the same quarter of fiscal 2010 as funding costs declined at a slower pace than interest income. The net interest margin on a tax-equivalent basis was 3.70 percent for the third quarter of fiscal 2011, compared to 3.91 percent for the same period a year ago. The tax-equivalent yield on investments decreased 58 basis points and loan yields were down 27 basis points compared to the third quarter fiscal 2010. As a result, the yield on interest-earning assets declined 37 basis points. For the same period, the cost of deposits decreased 8 basis points to 0.29 percent, and the cost of borrowings increased by 4 basis points to 3.67 percent.
Third quarter fiscal 2011 compared with linked quarter ended March 31, 2011
Net interest income for the quarter ended June 30, 2011 increased $293,000 compared to the linked quarter ended March 31, 2011. The tax-equivalent net interest margin increased 2 basis points from 3.68 percent in the linked quarter. The overall yield on loans increased 1 basis point to 5.41 percent. The yield on the investment portfolio decreased 4 basis points. The overall yield on earning assets remained relatively unchanged. The cost of interest-bearing deposits declined 3 basis points, reflecting the already low level of deposit pricing. The average cost of borrowing increased 9 basis points as a result of a change in the mix of shorter and long term advances.
2
Noninterest Income
Third quarter fiscal 2011 compared with third quarter fiscal 2010
Noninterest income totaled $5.2 million for the third quarter, relatively unchanged from the third quarter of fiscal 2010. Lower gains on sales of securities and loans, and decreased deposit fees and service charges were largely offset by a lower fair value loss on interest rate caps and increased investment management fees.
Third quarter fiscal 2011 compared with linked quarter ended March 31, 2011
Noninterest income decreased $578,000 on a linked-quarter basis, mainly due to lower gains on the sale of securities and loans partially offset by a lower fair value loss on interest rate caps in the linked quarter.
Noninterest Expense
Third quarter fiscal 2011 compared with third quarter fiscal 2010
Noninterest expense increased $1.9 million, when compared to the third quarter fiscal 2010. The increase is primarily due to charges of $1.5 million associated with the change in CEO and the related defined benefit settlement charges, REO expenses and occupancy expense offset in part by lower advertising and promotion, regulatory fees from FDIC insurance and intangible amortization. In addition the third quarter of 2010 benefited from a recovery of $300,000 related to servicing costs of our ATM and debit card program.
Third quarter fiscal 2011 compared with the linked quarter ended March 31, 2011
On a quarter-to-quarter basis, noninterest expense increased $878,000 or 4.0 percent. Increases were due to the change in CEO and the related defined benefit settlement charge. Absent these costs non-interest expense would have declined 1.6 percent.
Income Taxes
The Company recorded an income tax credit for the third quarter of $187,000 compared to an effective tax rate of 20.6 percent for the same period in fiscal 2010 (increased effect of BOLI and tax-exempt municipal security interest relative to pre-tax income). On a year-to-date basis the effective tax rate was 23 percent for fiscal 2011 and 24 percent for 2010.
Credit Quality
Nonperforming loans increased to $48.1 million at June 30, 2011 from $37.2 million at March 31, 2011, as a $12 million ADC loan relationship previously classified as a performing TDR was moved to nonperforming status due to a significant decline in sales activity in the past quarter. Net charge offs for the quarter ended June 30, 2011 were $4.3 million compared to $3.0 million for the linked quarter and $2.2 million for the quarter ended June 30, 2010. The increased was caused by charges related to the previously mentioned ADC relationship. Our provision was $3.6 million for the current quarter, decreasing our allowance for loan losses to $29.4 million, or 61 percent of non-performing loans at June 30, 2011. This compares to 81 percent at March 31, 2011 and 115 percent at September 30, 2010. Substandard loans at June 30, 2011 were $103.8 million, down from $113.9 million at March 31, 2011, and down from $132.1 million at September 30, 2010. Special mention loans were $24.1 million compared to $27.1 million at March 31, 2011 and $37.9 million at September 30, 2010.
Key Balance Sheet Changes
| • | The balance sheet grew $56.8 million or 1.9 percent compared to March 31, 2011 due to an increase in securities partly offset by a decrease in cash and due from banks. |
| • | Deposits decreased $3.7 million compared to March 31, 2011 excluding municipal and wholesale deposits. Transaction accounts excluding municipal deposits increased $2.9 million compared to March 31, 2011. |
3
| • | Total loan originations during third quarter fiscal 2011 were $148.3 million compared to $117.4 from the linked quarter. Commercial loan balances increased by $10.3 million over March 31, 2011 levels. Residential 1-4 family mortgages declined over the same period by $8.9 million. |
| • | Securities increased $84.0 million over March 31, 2011 levels, as $147.3 million in securities were purchased during the third quarter. Securities purchased during the period had durations between .25 and 6.44 years with weighted average yields of 2.42 percent. |
| • | Borrowings increased over March 31, 2011 levels by $22.4 million. The Company supplemented its borrowings with $101.4 million in wholesale deposits at a weighted average rate of 0.29 percent at June 30, 2011 compared to $43.4 million in wholesale deposits at a weighted average rate of 0.53 percent at March 31, 2011. |
Capital and Liquidity
Provident Bank remained well-capitalized at June 30, 2011 with the Bank’s Tier 1 leverage ratio at 8.8 percent. The Company’s tangible capital as a percent of tangible assets increased 6 basis points from March 31, 2011 levels to 9.37 percent at June 30, 2011, while tangible book value per share increased to $6.93 from $6.74 at March 31, 2011 (a reconciliation of these Non-GAAP equity ratios are included with the ratios listed on the last page). Total capital increased $8.8 million from March 31, 2011, to $429.0 million at June 30, 2011, due to a net decrease of $203,000 in the Company’s retained earnings, a $625,000 increase in treasury stock, an increase of $282,000 due to stock based compensation items, and a $9.3 million improvement in accumulated other comprehensive income. The Company repurchased in the open market 66,108 shares during the third fiscal quarter. The remaining authorization for share repurchases is 959,713 shares.
Other Information
The company holds four private label mortgage backed securities with an amortized cost of $5.6 million and an estimated fair value of $5.3 million. One security included within these amounts has a carrying value of $1.9 million after recording an other than temporary impairment charge of $27,000. The amortized cost of this security is $2.1 million. It is not likely that the Company will be required to sell this security prior to recovery of its amortized cost basis less any current-period credit loss.
About Provident New York Bancorp
Headquartered in Montebello, New York, Provident New York Bancorp is the parent company of Provident Bank, an independent full-service community bank. Provident Bank operates 35 branches that serve the Hudson Valley region. The Bank offers a complete line of commercial, retail and investment management services. For more information, visit the Company’s web site at www.providentbanking.com.
FORWARD-LOOKING STATEMENTS AND ASSOCIATED RISK FACTORS
In addition to historical information, this earnings release may contain forward-looking statements for purposes of applicable securities laws. Any statements contained herein that are not statements of historical fact may be deemed to be forward-looking statements. Forward-looking statements are subject to numerous assumptions, risks and uncertainties. There are a number of important factors described in documents previously filed by the Company with the Securities and Exchange Commission, and other factors that could cause the Company’s actual results to differ materially from those contemplated by such forward-looking statements. The Company undertakes no obligation to publicly release the results of any revisions to those forward-looking statements which may be made to reflect events or circumstances after the date of this release or to reflect the occurrence of unanticipated events.
Financial information contained in this release should be considered to be an estimate pending the filing with the Securities and Exchange Commission of the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2011. While the Company is not aware of any need to revise the results disclosed in this release, accounting literature may require adverse information received by management between the date of this release and the filing of the 10-Q to be reflected in the results of the fiscal period, even though the new information was received by management subsequent to the date of this release.
4
Reconciliation of Non GAAP Adjusted Earnings:
| Quarter Ended | Nine Months Ended | |||||||||||||||||||
| June 30, | March 31, | June 30, | ||||||||||||||||||
| 2011 | 2010 | 2011 | 2011 | 2010 | ||||||||||||||||
| Net Income |
||||||||||||||||||||
| Net Income |
$ | 1,939 | $ | 4,756 | $ | 3,573 | $ | 12,232 | $ | 15,089 | ||||||||||
| Securities net gains and credit losses1 |
(306 | ) | (561 | ) | (444 | ) | (3,246 | ) | (3,098 | ) | ||||||||||
| Defined benefit settlement charge/change in CEO1 |
887 | — | 165 | 1,052 | — | |||||||||||||||
| Fair value (gain) loss on interest rate caps1 |
154 | 353 | 1 | 16 | 494 | |||||||||||||||
| Net adjusted income |
$ | 2,674 | $ | 4,548 | $ | 3,295 | $ | 10,054 | $ | 12,485 | ||||||||||
| Earnings per common share |
||||||||||||||||||||
| Diluted Earnings per common share |
$ | 0.05 | $ | 0.12 | $ | 0.10 | $ | 0.33 | $ | 0.39 | ||||||||||
| Securities net gains and credit losses1 |
(0.01 | ) | (0.01 | ) | (0.01 | ) | (0.09 | ) | (0.08 | ) | ||||||||||
| Defined benefit settlement charge/change in CEO1 |
0.02 | — | — | 0.03 | — | |||||||||||||||
| Fair value loss on interest rate caps1 |
— | 0.01 | — | — | 0.01 | |||||||||||||||
| Diluted adjusted earnings per common share |
$ | 0.07 | * | $ | 0.12 | $ | 0.09 | $ | 0.27 | * | $ | 0.33 | * | |||||||
| Non-interest income |
||||||||||||||||||||
| Total non-interest income |
$ | 5,217 | $ | 5,281 | $ | 5,795 | $ | 20,896 | $ | 19,487 | ||||||||||
| Securities net gains and credit losses |
(515 | ) | (945 | ) | (748 | ) | (5,465 | ) | (5,217 | ) | ||||||||||
| Fair value (gain) loss on interest rate caps |
259 | 595 | 2 | 27 | 831 | |||||||||||||||
| Adjusted non interest-income |
$ | 4,961 | $ | 4,931 | $ | 5,049 | $ | 15,458 | $ | 15,101 | ||||||||||
| Non-interest expense |
||||||||||||||||||||
| Total non-interest expense |
$ | 22,669 | $ | 20,741 | $ | 21,791 | $ | 65,729 | $ | 61,808 | ||||||||||
| Defined benefit settlement charge/change in CEO1 |
(1,494 | ) | — | (278 | ) | (1,772 | ) | — | ||||||||||||
| Adjusted non interest-expense |
$ | 21,175 | $ | 20,741 | $ | 21,513 | $ | 63,957 | $ | 61,808 | ||||||||||
| 1 | After marginal tax effect 40.61% |
| * | Rounding |
5
Provident New York Bancorp and Subsidiaries
CONSOLIDATED CONDENSED STATEMENTS OF FINANCIAL CONDITION
(unaudited, in thousands, except share and per share data)
| June 30, | September 30, | March 31, | ||||||||||
| 2011 | 2010 | 2011 | ||||||||||
| Assets: |
||||||||||||
| Cash and due from banks |
$ | 45,530 | $ | 90,872 | $ | 72,670 | ||||||
| Total securities |
945,230 | 934,860 | 861,233 | |||||||||
| Loans held for sale |
— | 5,890 | — | |||||||||
| Loans:(1) |
||||||||||||
| One- to four-family residential mortgage loans |
402,072 | 434,900 | 411,014 | |||||||||
| Commercial real estate, commercial business |
863,370 | 797,159 | 841,129 | |||||||||
| Acquisition, development and construction loans |
193,312 | 231,258 | 205,293 | |||||||||
| Consumer loans |
226,518 | 238,224 | 227,391 | |||||||||
| Total loans, gross |
1,685,272 | 1,701,541 | 1,684,827 | |||||||||
| Allowance for loan losses |
(29,385 | ) | (30,843 | ) | (30,130 | ) | ||||||
| Total loans, net |
1,655,887 | 1,670,698 | 1,654,697 | |||||||||
| Federal Home Loan Bank stock, at cost |
18,807 | 19,572 | 18,179 | |||||||||
| Premises and equipment, net |
42,249 | 43,598 | 42,830 | |||||||||
| Goodwill |
160,861 | 160,861 | 160,861 | |||||||||
| Other amortizable intangibles |
4,967 | 3,640 | 2,857 | |||||||||
| Bank owned life insurance |
56,454 | 50,938 | 51,985 | |||||||||
| Other assets |
46,072 | 40,096 | 53,979 | |||||||||
| Total assets |
$ | 2,976,057 | $ | 3,021,025 | $ | 2,919,291 | ||||||
| Liabilities: |
||||||||||||
| Deposits |
||||||||||||
| Retail |
$ | 174,652 | $ | 174,731 | $ | 174,286 | ||||||
| Commercial |
279,659 | 277,217 | 273,876 | |||||||||
| Municipal |
15,559 | 77,909 | 15,641 | |||||||||
| Personal NOW deposits |
155,141 | 139,517 | 153,388 | |||||||||
| Business NOW deposits |
29,892 | 34,105 | 34,870 | |||||||||
| Municipal NOW deposits |
113,876 | 241,995 | 122,153 | |||||||||
| Total transaction accounts |
768,779 | 945,474 | 774,214 | |||||||||
| Savings |
428,120 | 392,321 | 420,775 | |||||||||
| Money market deposits |
512,478 | 427,334 | 546,173 | |||||||||
| Certificates of deposit |
388,696 | 377,573 | 348,742 | |||||||||
| Total deposits |
2,098,073 | 2,142,702 | 2,089,904 | |||||||||
| Borrowings |
350,333 | 363,751 | 327,943 | |||||||||
| Borrowings Senior Note |
51,498 | 51,496 | 51,498 | |||||||||
| Mortgage escrow funds and other liabilities |
47,116 | 32,121 | 29,677 | |||||||||
| Total liabilities |
2,547,020 | 2,590,070 | 2,499,022 | |||||||||
| Stockholders’ equity |
429,037 | 430,955 | 420,269 | |||||||||
| Total liabilities and stockholders’ equity |
$ | 2,976,057 | $ | 3,021,025 | $ | 2,919,291 | ||||||
| Shares of common stock outstanding at period end |
38,005,866 | 38,262,288 | 38,072,942 | |||||||||
| Book value per share |
$ | 11.29 | $ | 11.26 | $ | 11.04 | ||||||
| (1) | Certain amounts from prior periods have been reclassed to conform to current fiscal year presentation |
6
Provident New York Bancorp and Subsidiaries
CONSOLIDATED CONDENSED STATEMENTS OF INCOME
(unaudited, in thousands, except share and per share data)
| Quarter | ||||||||||||||||||||
| Quarter Ended | Ended | Nine Months Ended | ||||||||||||||||||
| June 30, | March 31, | June 30, | ||||||||||||||||||
| 2011 | 2010 | 2011 | 2011 | 2010 | ||||||||||||||||
| Interest and dividend income: |
||||||||||||||||||||
| Loans and loan fees |
22,261 | $ | 23,393 | 22,039 | $ | 67,505 | $ | 69,448 | ||||||||||||
| Securities taxable |
3,607 | 4,716 | 3,531 | 10,668 | 14,192 | |||||||||||||||
| Securities non-taxable |
1,829 | 2,037 | 1,901 | 5,655 | 5,833 | |||||||||||||||
| Other earning assets |
237 | 262 | 332 | 968 | 980 | |||||||||||||||
| 27,934 | 30,408 | 27,803 | 84,796 | 90,453 | ||||||||||||||||
| Interest expense: |
||||||||||||||||||||
| Deposits |
1,493 | 1,849 | 1,585 | 4,720 | 6,840 | |||||||||||||||
| Borrowings |
3,637 | 4,361 | 3,707 | 11,578 | 13,595 | |||||||||||||||
| Total interest expense |
5,130 | 6,210 | 5,292 | 16,298 | 20,435 | |||||||||||||||
| Net interest income |
22,804 | 24,198 | 22,511 | 68,498 | 70,018 | |||||||||||||||
| Provision for loan losses |
3,600 | 2,750 | 2,100 | 7,800 | 7,750 | |||||||||||||||
| Net interest income after provision for loan losses |
19,204 | 21,448 | 20,411 | 60,698 | 62,268 | |||||||||||||||
| Non-interest income: |
||||||||||||||||||||
| Deposit fees and service charges |
$ | 2,674 | $ | 2,796 | $ | 2,643 | $ | 8,085 | $ | 8,533 | ||||||||||
| Net gain on sales of securities |
542 | 945 | 748 | 5,492 | 5,217 | |||||||||||||||
| Credit loss on security (OTTI) |
(27 | ) | — | — | (27 | ) | — | |||||||||||||
| Title insurance fees |
312 | 336 | 274 | 949 | 884 | |||||||||||||||
| Bank owned life insurance |
488 | 503 | 553 | 1,535 | 1,553 | |||||||||||||||
| Gain on sale of loans |
9 | 45 | 310 | 861 | 445 | |||||||||||||||
| Investment management fees |
815 | 756 | 789 | 2,347 | 2,311 | |||||||||||||||
| Fair value gain (loss) interest rate caps |
(259 | ) | (595 | ) | (2 | ) | (27 | ) | (831 | ) | ||||||||||
| Other |
663 | 495 | 480 | 1,681 | 1,375 | |||||||||||||||
| Total non-interest income |
5,217 | 5,281 | 5,795 | 20,896 | 19,487 | |||||||||||||||
| Non-interest expense: |
||||||||||||||||||||
| Compensation and benefits |
11,122 | 11,061 | 11,183 | 33,533 | 32,149 | |||||||||||||||
| Defined benefit settlement charge/CEO change |
1,494 | — | 278 | 1,772 | — | |||||||||||||||
| Stock-based compensation plans |
284 | 172 | 296 | 859 | 1,205 | |||||||||||||||
| Occupancy and office operations |
3,423 | 3,168 | 3,757 | 10,815 | 10,031 | |||||||||||||||
| Advertising and promotion |
855 | 1,041 | 843 | 2,651 | 2,577 | |||||||||||||||
| Professional fees |
1,137 | 1,063 | 1,043 | 3,242 | 2,811 | |||||||||||||||
| Data and check processing |
712 | 571 | 691 | 2,045 | 1,698 | |||||||||||||||
| Amortization of intangible assets |
305 | 452 | 371 | 1,088 | 1,417 | |||||||||||||||
| FDIC insurance and regulatory assessments |
587 | 927 | 919 | 2,274 | 2,642 | |||||||||||||||
| ATM/debit card expense |
400 | 164 | 366 | 1,159 | 1,254 | |||||||||||||||
| Foreclosed property expense |
461 | 69 | 117 | 494 | 116 | |||||||||||||||
| Other |
1,889 | 2,053 | 1,927 | 5,797 | 5,908 | |||||||||||||||
| Total non-interest expense |
22,669 | 20,741 | 21,791 | 65,729 | 61,808 | |||||||||||||||
| Income before income tax expense |
1,752 | 5,988 | 4,415 | 15,865 | 19,947 | |||||||||||||||
| Income tax expense |
(187 | ) | 1,232 | 842 | 3,633 | 4,858 | ||||||||||||||
| Net income |
$ | 1,939 | $ | 4,756 | $ | 3,573 | $ | 12,232 | $ | 15,089 | ||||||||||
| Per common share: |
||||||||||||||||||||
| Basic earnings |
$ | 0.05 | $ | 0.12 | $ | 0.10 | $ | 0.33 | $ | 0.39 | ||||||||||
| Diluted earnings |
0.05 | 0.12 | 0.10 | 0.33 | 0.39 | |||||||||||||||
| Dividends declared |
0.06 | 0.06 | 0.06 | 0.18 | 0.18 | |||||||||||||||
| Weighted average common shares: |
||||||||||||||||||||
| Basic |
37,368,391 | 38,086,535 | 37,496,395 | 37,472,548 | 38,284,965 | |||||||||||||||
| Diluted |
37,370,213 | 38,086,579 | 37,497,467 | 37,473,167 | 38,317,220 | |||||||||||||||
7
Selected Financial Condition Data:
| Three Months Ended | ||||||||||||||||||||
| (in thousands except share and per share data) | 06/30/11 | 03/31/11 | 12/31/10 | 09/30/10 | 06/30/10 | |||||||||||||||
| End of Period |
||||||||||||||||||||
| Total assets |
$ | 2,976,057 | $ | 2,919,291 | $ | 2,940,513 | $ | 3,021,025 | $ | 2,963,706 | ||||||||||
| Loans, gross (1) |
1,685,272 | 1,684,827 | 1,699,502 | 1,701,541 | 1,705,737 | |||||||||||||||
| Securities available for sale |
919,805 | 833,179 | 869,996 | 901,012 | 878,370 | |||||||||||||||
| Securities held to maturity |
25,425 | 28,054 | 30,425 | 33,848 | 40,452 | |||||||||||||||
| Bank owned life insurance |
56,454 | 51,985 | 51,433 | 50,938 | 50,447 | |||||||||||||||
| Goodwill |
160,861 | 160,861 | 160,861 | 160,861 | 160,861 | |||||||||||||||
| Other amortizable intangibles |
4,967 | 2,857 | 3,229 | 3,640 | 4,072 | |||||||||||||||
| Other non-earning assets |
88,321 | 96,809 | 94,933 | 83,694 | 85,398 | |||||||||||||||
| Deposits |
2,098,073 | 2,089,904 | 1,980,068 | 2,142,702 | 1,961,005 | |||||||||||||||
| Borrowings |
401,831 | 379,441 | 495,783 | 415,247 | 526,912 | |||||||||||||||
| Equity |
429,037 | 420,269 | 419,642 | 430,955 | 429,115 | |||||||||||||||
| Other comprehensive income related to investment securities reflected in stockholders’ equity |
5,769 | (3,146 | ) | (2,932 | ) | 12,621 | 9,953 | |||||||||||||
| Average Balances |
||||||||||||||||||||
| Total assets |
$ | 2,915,988 | $ | 2,940,299 | $ | 2,961,458 | $ | 2,919,961 | $ | 2,928,626 | ||||||||||
| Loans, gross: |
||||||||||||||||||||
| Real estate- residential mortgage |
384,582 | 386,592 | 400,229 | 417,584 | 427,801 | |||||||||||||||
| Real estate- commercial mortgage |
648,371 | 619,145 | 606,701 | 570,023 | 552,888 | |||||||||||||||
| Real estate- Acquisition, Development & Construction |
198,120 | 216,914 | 226,816 | 227,165 | 222,958 | |||||||||||||||
| Commercial and industrial |
222,128 | 229,632 | 236,390 | 243,691 | 236,275 | |||||||||||||||
| Consumer loans |
228,993 | 232,712 | 237,106 | 239,908 | 243,484 | |||||||||||||||
| Loans total (1) |
1,682,194 | 1,684,995 | 1,707,242 | 1,698,371 | 1,683,406 | |||||||||||||||
| Securities (taxable) |
688,445 | 684,834 | 692,346 | 655,794 | 693,554 | |||||||||||||||
| Securities (non-taxable) |
208,643 | 214,634 | 221,802 | 222,024 | 219,121 | |||||||||||||||
| Total earning assets |
2,580,429 | 2,594,131 | 2,628,815 | 2,578,024 | 2,594,264 | |||||||||||||||
| Non earning assets |
335,559 | 346,168 | 332,643 | 341,937 | 334,362 | |||||||||||||||
| Non-interest bearing checking |
464,197 | 468,031 | 470,873 | 449,666 | 430,387 | |||||||||||||||
| Interest bearing NOW accounts |
296,677 | 338,503 | 317,876 | 266,950 | 263,709 | |||||||||||||||
| Total transaction accounts |
760,874 | 806,534 | 788,749 | 716,616 | 694,096 | |||||||||||||||
| Savings (including mortgage escrow funds) |
444,913 | 416,777 | 405,177 | 424,012 | 413,315 | |||||||||||||||
| Money market deposits |
529,286 | 490,215 | 433,865 | 421,989 | 428,612 | |||||||||||||||
| Certificates of deposit |
346,903 | 367,099 | 406,241 | 415,059 | 467,360 | |||||||||||||||
| Total deposits and mortgage escrow |
2,081,976 | 2,080,625 | 2,034,032 | 1,977,676 | 2,003,383 | |||||||||||||||
| Total interest bearing deposits |
1,617,779 | 1,612,594 | 1,563,159 | 1,528,010 | 1,572,996 | |||||||||||||||
| Borrowings |
397,531 | 420,069 | 481,939 | 486,060 | 481,460 | |||||||||||||||
| Equity |
424,961 | 419,847 | 428,900 | 430,862 | 424,221 | |||||||||||||||
| Selected Operating Data: |
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| Condensed Tax Equivalent Income Statement |
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| Interest and dividend income |
$ | 27,934 | $ | 27,803 | $ | 29,060 | $ | 29,321 | $ | 30,408 | ||||||||||
| Tax equivalent adjustment* |
985 | 1,024 | 1,036 | 1,045 | 1,098 | |||||||||||||||
| Interest expense |
5,130 | 5,292 | 5,876 | 6,005 | 6,210 | |||||||||||||||
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| Net interest income (tax equivalent) |
23,789 | 23,535 | 24,220 | 24,361 | 25,296 | |||||||||||||||
| Provision for loan losses |
3,600 | 2,100 | 2,100 | 2,250 | 2,750 | |||||||||||||||
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| Net interest income after provision for loan losses |
20,189 | 21,435 | 22,120 | 22,111 | 22,546 | |||||||||||||||
| Non-interest income |
5,217 | 5,795 | 9,883 | 7,714 | 5,281 | |||||||||||||||
| Non-interest expense |
22,669 | 21,791 | 21,269 | 21,362 | 20,741 | |||||||||||||||
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| Income before income tax expense |
2,737 | 5,439 | 10,734 | 8,463 | 7,086 | |||||||||||||||
| Income tax expense (tax equivalent)* |
798 | 1,866 | 4,014 | 3,060 | 2,330 | |||||||||||||||
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| Net income |
$ | 1,939 | $ | 3,573 | $ | 6,720 | $ | 5,403 | $ | 4,756 | ||||||||||
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| (1) | Does not reflect allowance for loan losses of $29,385, $30,130, $31,036, $30,843 and $31,021. |
| * | Tax exempt income assumed at a 35% federal rate |
8
| Three Months Ended | ||||||||||||||||||||
| 06/30/11 | 03/31/11 | 12/31/10 | 09/30/10 | 06/30/10 | ||||||||||||||||
| Performance Ratios (annualized) |
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| Return on Average Assets |
0.27 | % | 0.49 | % | 0.90 | % | 0.73 | % | 0.65 | % | ||||||||||
| Return on Average Equity |
1.83 | % | 3.45 | % | 6.22 | % | 4.98 | % | 4.50 | % | ||||||||||
| Non-Interest Income to Average Assets |
0.72 | % | 0.80 | % | 1.32 | % | 1.05 | % | 0.72 | % | ||||||||||
| Non-Interest Expense to Average Assets |
3.12 | % | 3.01 | % | 2.85 | % | 2.90 | % | 2.84 | % | ||||||||||
| Operating Efficiency Adjusted (2) |
70.99 | % | 73.56 | % | 70.59 | % | 71.09 | % | 66.89 | % | ||||||||||
| Analysis of Net Interest Income |
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| Yield on Loans |
5.41 | % | 5.40 | % | 5.47 | % | 5.48 | % | 5.68 | % | ||||||||||
| Yield on Investment Securities- Tax Equivalent |
2.87 | % | 2.91 | % | 2.82 | % | 3.16 | % | 3.45 | % | ||||||||||
| Yield on Earning Assets- Tax Equivalent |
4.50 | % | 4.51 | % | 4.54 | % | 4.67 | % | 4.87 | % | ||||||||||
| Cost of Interest Bearing Deposits |
0.37 | % | 0.40 | % | 0.42 | % | 0.44 | % | 0.47 | % | ||||||||||
| Cost of Borrowings |
3.67 | % | 3.58 | % | 3.49 | % | 3.53 | % | 3.63 | % | ||||||||||
| Cost of Interest Bearing Liabilities |
1.02 | % | 1.06 | % | 1.14 | % | 1.18 | % | 1.21 | % | ||||||||||
| Net Interest Rate Spread- Tax Equivalent Basis |
3.48 | % | 3.45 | % | 3.40 | % | 3.49 | % | 3.66 | % | ||||||||||
| Net Interest Margin- Tax Equivalent Basis |
3.70 | % | 3.68 | % | 3.66 | % | 3.75 | % | 3.91 | % | ||||||||||
| Capital Information Data |
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| Tier 1 Leverage Ratio- Bank Only |
8.77 | % | 9.10 | % | 8.89 | % | 8.43 | % | 8.75 | % | ||||||||||
| Tier 1 Risk-Based Capital- Bank Only |
246,291 | 251,338 | 247,503 | 240,230 | 244,299 | |||||||||||||||
| Total Risk-Based Capital- Bank Only |
271,483 | 276,303 | 272,071 | 265,148 | 268,996 | |||||||||||||||
| Tangible Capital Consolidated (3) |
263,209 | 256,551 | 255,552 | 266,454 | 264,182 | |||||||||||||||
| Tangible Capital as a % of Tangible Assets Consolidated (3) |
9.37 | % | 9.31 | % | 9.20 | % | 9.33 | % | 9.44 | % | ||||||||||
| Shares Outstanding |
38,005,866 | 38,072,942 | 38,198,686 | 38,262,288 | 38,628,477 | |||||||||||||||
| Shares Repurchased during qrtr(open market) |
66,108 | 125,744 | 82,602 | 364,000 | 233,000 | |||||||||||||||
| Basic weighted common shares outstanding |
37,368,391 | 37,496,395 | 37,552,245 | 37,793,860 | 38,086,535 | |||||||||||||||
| Diluted common shares outstanding |
37,370,213 | 37,497,467 | 37,552,245 | 37,793,860 | 38,086,579 | |||||||||||||||
| Basic Earnings per common share |
$ | 0.05 | $ | 0.10 | $ | 0.18 | $ | 0.14 | $ | 0.12 | ||||||||||
| Diluted Earnings per common share |
0.05 | 0.10 | 0.18 | 0.14 | 0.12 | |||||||||||||||
| Dividends Paid per common share |
0.06 | 0.06 | 0.06 | 0.06 | 0.06 | |||||||||||||||
| Book Value per common share |
11.29 | 11.04 | 10.99 | 11.26 | 11.11 | |||||||||||||||
| Tangible Book Value per common share (3) |
6.93 | 6.74 | 6.69 | 6.96 | 6.84 | |||||||||||||||
| Asset Quality Measurements |
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| Non-performing loans (NPLs): non-accrual |
$ | 42,226 | $ | 29,765 | $ | 30,690 | $ | 21,413 | $ | 21,985 | ||||||||||
| Non-performing loans (NPLs): still accruing |
5,837 | 7,412 | 5,536 | 5,427 | 7,069 | |||||||||||||||
| Other Real Estate Owned |
5,184 | 5,351 | 3,585 | 3,891 | 3,302 | |||||||||||||||
| Non-performing assets (NPAs) |
53,247 | 42,528 | 39,811 | 30,731 | 32,356 | |||||||||||||||
| Troubled Debt Restructures still accruing |
7,447 | 21,954 | 17,581 | 16,047 | 414 | |||||||||||||||
| Net Charge-offs |
4,345 | 3,006 | 1,907 | 2,428 | 2,173 | |||||||||||||||
| Net Charge-offs as % of average loans (annualized) |
1.03 | % | 0.71 | % | 0.45 | % | 0.57 | % | 0.52 | % | ||||||||||
| NPLs as % of total loans |
2.85 | % | 2.21 | % | 2.13 | % | 1.58 | % | 1.70 | % | ||||||||||
| NPAs as % of total assets |
1.79 | % | 1.46 | % | 1.35 | % | 1.02 | % | 1.09 | % | ||||||||||
| Allowance for loan losses as % of NPLs |
61 | % | 81 | % | 86 | % | 115 | % | 107 | % | ||||||||||
| Allowance for loan losses as % of total loans |
1.74 | % | 1.79 | % | 1.83 | % | 1.81 | % | 1.82 | % | ||||||||||
| (2) | The efficiency ratio represents non-interest expense divided by the sum of net interest income and non-interest income. As in the case of net interest income, generally, net interest income as utilized in calculating the efficiency ratio is typically expressed on a tax-equivalent basis. Moreover, most institutions, in calculating the the efficiency ratio, also adjust both noninterest expense and noninterest income to exclude from these items (as calculated under generally accepted accounting principles) certain component elements, such as non-recurring charges, other real estate expense and amortization of intangibles (deducted from non interest expense) and security transactions and other non-recurring items (excluded from non interest income). We follow these practices. |
| (3) | Provident Bank provides supplemental reporting of Non-GAAP tangible equity ratios as management believes this information is useful to investors. |
The following table shows the reconciliation of tangible equity and the tangible equity ratio:
| 06/30/11 | 03/31/11 | 12/31/10 | 09/30/10 | 06/30/10 | ||||||||||||||||
| Total Assets |
$ | 2,976,057 | $ | 2,919,291 | $ | 2,940,513 | $ | 3,021,025 | $ | 2,963,706 | ||||||||||
| Goodwill and other amortizable intangibles |
(165,828 | ) | (163,718 | ) | (164,090 | ) | (164,501 | ) | (164,933 | ) | ||||||||||
| Tangible Assets |
$ | 2,810,229 | $ | 2,755,573 | $ | 2,776,423 | $ | 2,856,524 | $ | 2,798,773 | ||||||||||
| Stockholders’ equity |
429,037 | 420,269 | 419,642 | 430,955 | 429,115 | |||||||||||||||
| Goodwill and other amortizable intangibles |
(165,828 | ) | (163,718 | ) | (164,090 | ) | (164,501 | ) | (164,933 | ) | ||||||||||
| Tangible Stockholders’ equity |
$ | 263,209 | $ | 256,551 | $ | 255,552 | $ | 266,454 | $ | 264,182 | ||||||||||
| Outstanding Shares |
38,005,866 | 38,072,942 | 38,198,686 | 38,262,288 | 38,628,477 | |||||||||||||||
| Tangible capital as a % of tangible assets (consolidated) |
9.37 | % | 9.31 | % | 9.20 | % | 9.33 | % | 9.44 | % | ||||||||||
| Tangible book value per share |
$ | 6.93 | $ | 6.74 | $ | 6.69 | $ | 6.96 | $ | 6.84 | ||||||||||
9