Attached files
| file | filename |
|---|---|
| 8-K - FORM 8-K - WEBSTER FINANCIAL CORP | d423675d8k.htm |
Exhibit 99.1
| Media Contact |
Investor Contact | |||
| Bob Guenther, 203-578-2391 |
Terry Mangan 203-578-2318 | |||
| rguenther@websterbank.com | tmangan@websterbank.com |
WEBSTER REPORTS INCREASED 2012 THIRD QUARTER EARNINGS
Net Income Grows by 9 Percent over Second Quarter
WATERBURY, Conn., October 12, 2012 – Webster Financial Corporation (NYSE: WBS), the holding company for Webster Bank, N.A., today announced net income available to common shareholders of $44.4 million, or $.48 per diluted share, for the quarter ended September 30, 2012 compared to $40.6 million, or $.44 per diluted share, for the quarter ended June 30, 2012 and $41.4 million, or $.45 per diluted share, for the quarter ended September 30, 2011.
Highlights for the quarter or at September 30 include:
Combined growth in commercial and commercial real estate loans of $229.3 million or 4.1 percent from June 30, and $649.2 million or 12.7 percent from a year ago.
Deposit growth of $439.5 million or 3.1 percent linked quarter and $827.5 million or 6.1 percent over prior year. Transaction account deposits now represent an all time high of 39.3 percent of total deposits.
Continued improvement in asset quality as evidenced by a 3.5 percent reduction in nonperforming assets and an 11.9 percent decline in commercial classified loans, both from June 30, and reductions of 30.2 percent and 38.3 percent from a year ago.
Continued achievement of positive operating leverage of 2.5 percent as core revenue grew by 1.8 percent and core expenses declined by 0.7 percent from the second quarter.
Return on assets, return on equity and return on tangible equity improved to 0.92 percent, 9.18 percent and 12.65 percent, respectively, compared to 0.86 percent, 8.62 percent and 11.99 percent, respectively, in the second quarter
Webster Chairman and Chief Executive Officer James C. Smith said, “Webster’s momentum continued to build in the third quarter. Loans and deposits grew, revenues increased while expenses declined, asset quality trends remain favorable and earnings regained pre-recession levels. Our investments in business banking, mortgage banking and other relationship development initiatives are positively influencing operating results.”
Net interest income
| • | Net interest income was $144.9 million for the quarter compared to $144.4 million in the second quarter. |
| • | Net interest margin was 3.28 percent compared to 3.32 percent in the second quarter as the yield on interest-earning assets declined 12 basis points, primarily on securities, and the cost of funds declined 9 basis points. |
| • | Average interest-earning assets grew by 1.4 percent from the second quarter and totaled $18.1 billion compared to $17.8 billion in the second quarter. |
| • | Average loans grew by $187.6 million or 1.6 percent from the second quarter. |
Webster President and Chief Operating Officer Jerry Plush noted, “A double-digit increase in commercial and commercial real estate loans over the past year and growth in lower-cost transaction deposits have contributed to improving operating results. We achieved positive operating leverage again and continued improvement in our efficiency ratio from 63.7 percent in the second quarter to 62.3 percent as a result of increased revenue and disciplined expense management.”
Provision for loan losses
| • | The Company recorded a provision of $5.0 million in the quarter, the same as in the second quarter and in the year ago period. |
| • | Net charge-offs were $17.7 million in the quarter compared to $16.5 million for the second quarter and $28.9 million a year ago. |
| • | The allowance for loan losses represented 114 percent of nonperforming loans compared to 117 percent in the prior quarter. |
Noninterest income
| • | Total noninterest income increased $1.1 million compared to the second quarter. Included in noninterest income is $0.8 million of securities gains in the third quarter and $2.5 million in the second quarter. |
| • | The $2.9 million increase in core noninterest income compared to the second quarter reflects an increase of $2.9 million in mortgage banking activities attributable to favorable spreads on loans originated for sale. Deposit service fees increased by $1.0 million. Loan fees increased by $0.5 million. |
| • | Other income decreased $1.6 million primarily from $0.5 million of direct investment write-downs compared to $0.5 million of direct investment income in the second quarter. |
Noninterest expense
| • | Total noninterest expense decreased $3.3 million compared to the second quarter. Included in noninterest expense are net one time costs of $0.6 million in the third quarter and $3.2 million in the second quarter. |
| • | Total noninterest expense excluding one time costs decreased $0.6 million from the second quarter and increased $3.6 million from a year ago. The decrease compared to the second quarter is driven by a combined reduction of $2.6 million in technology, marketing, professional services and loan workout expenses offset by an increase of $2.5 million in compensation and benefits expense. The increase in compensation and benefits is primarily the result of compensation tied to stock valuation, including increases of $0.6 million in cash award plan expense and $0.5 million in deferred compensation. The cash award plan vests during the fourth quarter, which will eliminate expense volatility from this plan in future quarters. Gains on foreclosed and repossessed assets were $0.4 million in the third quarter and $0.7 million in the second quarter. |
Income taxes
| • | The Company recorded $19.5 million of income tax expense in the quarter on the $64.5 million of pre-tax income applicable to continuing operations in the period. The effective tax rate for the quarter was 30.2 percent, compared to 30.7 percent for the second quarter, and reflects a net tax benefit of $0.3 million that was specific to the period. |
Investment securities
| • | Total investment securities were $6.3 billion at September 30, 2012 and $6.2 billion at June 30, 2012. The carrying value of the available for sale portfolio included $68.9 million in net unrealized gains compared to net unrealized gains of $46.7 million at June 30, while the carrying value of the held to maturity portfolio does not reflect $179.2 million in net unrealized gains compared to net unrealized gains of $158.4 million at June 30. |
Loans
| • | Total loans were $11.7 billion at September 30, 2012 compared to $11.5 billion at June 30, 2012 and are reflective of continued growth in commercial and commercial real estate loans. In the quarter, commercial and commercial real estate loans increased by $152.8 million and $76.5 million, respectively. Residential mortgage and consumer loans decreased by $7.7 million and $34.0 million, respectively. |
| • | Loan originations for portfolio in the third quarter were $835.6 million compared to $973.0 million in the second quarter and $716.2 million a year ago. In addition to loan originations for portfolio, $207.7 million of residential loans were originated and sold with servicing retained in the quarter compared to $198.3 million in the second quarter and $69.5 million a year ago. |
Asset quality
| • | Total nonperforming loans declined to $162.6 million, or 1.39 percent of total loans, at September 30, 2012 compared to $169.2 million, or 1.47 percent, at June 30, 2012. Included in nonperforming loans were paying loans totaling $16.8 million at September 30 compared to $17.0 million at June 30. Also included in nonperforming loans are $4.6 million in consumer liquidating loans compared to $4.5 million at June 30. |
| • | Past due loans increased to $67.4 million at September 30 compared to $65.9 million at June 30 attributable to one commercial real estate loan that is no longer past due subsequent to the end of the third quarter. Past due loans represented 0.57 percent of total loans at both September 30 and June 30. Past due loans for the continuing portfolios were $62.5 million at September 30 compared to $61.5 million at June 30. Past due loans for the liquidating portfolio were $4.9 million at September 30 compared to $4.4 million at June 30. |
| • | Other real estate owned (OREO) totaled $4.9 million compared to $4.4 million at June 30. |
Deposits and borrowings
| • | Total deposits were $14.4 billion at September 30, 2012 compared to $14.0 billion at June 30, 2012. Increases of $175.2 million in demand, $20.1 million in interest-bearing checking and $406.6 million in money market deposits were offset by declines of $74.3 million in savings and $88.2 million in certificates of deposit. Core to total deposits and loans to deposits were 81.8 percent and 81.4 percent, respectively, compared to 80.6 percent and 82.6 percent at June 30. |
| • | Total borrowings were $3.1 billion at September 30 compared to $3.2 billion at June 30. |
Capital
| • | The tangible common equity and Tier 1 common equity to risk-weighted assets ratios were 7.39 percent and 11.09 percent, respectively, at September 30, 2012 compared to 7.22 percent and 10.97 percent, respectively, at June 30, 2012. |
| • | Book value and tangible book value per common share were $22.24 and $16.13, respectively, at September 30 compared to $21.65 and $15.53, respectively, at June 30. |
| • | Return on average shareholders’ equity and return on average tangible equity were 9.18 percent and 12.65 percent, respectively, at September 30 compared to 8.62 percent and 11.99 percent, respectively, at June 30. |
***
Webster Financial Corporation is the holding company for Webster Bank, National Association. With $20 billion in assets, Webster provides business and consumer banking, mortgage, financial planning, trust and investment services through 167 banking offices, 466 ATMs, 293 of which are owned by Webster and 173 of which are branded, telephone banking, mobile banking, and the Internet. Webster Bank owns the asset based lending firm Webster Business Credit Corporation; the equipment finance firm Webster Capital Finance Corporation; and provides health savings account trustee and administrative services through HSA Bank, a division of Webster Bank. Member FDIC and equal housing lender. For more information about Webster, including past press releases and the latest annual report, visit the Webster website at www.websterbank.com.
***
Conference Call
A conference call covering Webster’s third quarter earnings announcement will be held today, Friday, October 12, at 9:00 a.m. (Eastern) and may be heard through Webster’s Investor Relations website at www.wbst.com, or in listen-only mode by calling 1-877-407-8289 or 201-689-8341 internationally. The call will be archived on the website and available for future retrieval.
Forward-Looking Statements
This release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 (the “Act”). Forward-looking statements can be identified by words such as “believes,” “anticipates,” “expects,” “intends,” “targeted,” “continue,” “remain,” “will,” “should,” “may,” “plans,” “estimates,” and similar references to future periods; however, such words are not the exclusive means of identifying such statements. Examples of forward-looking statements include, but are not limited to: (i) projections of revenues, expenses, income or loss, earnings or loss per share, and other financial items; (ii) statements of plans, objectives, and expectations of Webster or its management or Board of Directors; (iii) statements of future economic performance; and (iv) statements of assumptions underlying such statements. Forward-looking statements are based on Webster’s current expectations and assumptions regarding its business, the economy, and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks, and changes in circumstances that are difficult to predict. Webster’s actual results may differ materially from those contemplated by the forward-looking statements, which are neither statements of historical fact nor guarantees or assurances of future performance. Factors that could cause actual results to differ from those discussed in the forward-looking statements include, but are not limited to: (1) local, regional, national, and international economic conditions and the impact they may have on us and our customers and our assessment of that impact; (2) volatility and disruption in national and international financial markets; (3) government intervention in the U.S. financial system; (4) changes in the level of non-performing assets and charge-offs; (5) changes in estimates of future reserve requirements based upon the periodic review thereof under relevant regulatory and accounting requirements; (6) adverse conditions in the securities markets that lead to impairment in the value of securities in our investment portfolio; (7) inflation, interest rate, securities market, and monetary fluctuations; (8) the timely development and acceptance of new products and services and perceived overall value of these products and services by customers; (9) changes in consumer spending, borrowings, and savings habits; (10) technological changes; (11) the ability to increase market share and control expenses; (12) changes in the competitive environment among banks, financial holding companies, and other financial service providers; (13) the effect of changes in laws and regulations (including laws and regulations concerning taxes, banking, securities, and insurance) with which we and our subsidiaries must comply, including those under the Dodd-Frank Wall Street Reform and Consumer Protection Act and the Basel III update to the Basel Accords that is under development; (14) the effect of changes in accounting policies and practices, as may be adopted by the regulatory agencies, as well as the Public Company Accounting Oversight Board, the Financial Accounting Standards Board, and other accounting standard setters; (15) the costs and effects of legal and regulatory developments including the resolution of legal proceedings or regulatory or other governmental inquiries and the results of regulatory examinations or reviews; and (16) our success at managing the risks involved in the foregoing items and (17) the other factors that are described in the Company’s Annual Report on Form 10-K and Quarterly Reports on Form 10-Q under the heading “Risk Factors.” Any forward-looking statement made by the Company in this release speaks only as of the date on which it is made. Factors or events that could cause the Company’s actual results to differ may emerge from time to time, and it is not possible for the Company to predict all of them. The Company undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future developments or otherwise, except as may be required by law.
Non-GAAP Financial Measures
In addition to results presented in accordance with GAAP, this press release contains certain non-GAAP financial measures. A reconciliation of net income and other performance ratios, as adjusted, is included in the accompanying selected financial highlights table.
We believe that providing certain non-GAAP financial measures provides investors with information useful in understanding our financial performance, our performance trends and financial position. Specifically, we provide measures based on what we believe are our operating earnings on a consistent basis and exclude non-core operating items which affect the GAAP reporting of results of operations. We utilize these measures for internal planning and forecasting purposes. We, as well as securities analysts, investors, and other interested parties, also use these measures to compare peer company operating performance. We believe that our presentation and discussion, together with the accompanying reconciliations, provides a complete understanding of factors and trends affecting our business and allows investors to view performance in a manner similar to management. These non-GAAP measures should not be considered a substitute for GAAP basis measures and results, and we strongly encourage investors to review our consolidated financial statements in their entirety and not to rely on any single financial measure. Because non-GAAP financial measures are not standardized, it may not be possible to compare these financial measures with other companies’ non-GAAP financial measures having the same or similar names.
—30—
WEBSTER FINANCIAL CORPORATION
Selected Financial Highlights (unaudited)
| At or for the Three Months Ended | ||||||||||||||||||||
| (In thousands, except per share data) |
Sept. 30, 2012 |
June 30, 2012 |
March 31, 2012 |
Dec. 31, 2011 |
Sept. 30, 2011 |
|||||||||||||||
| Income and performance ratios, (annualized): |
||||||||||||||||||||
| Income attributable to Webster Financial Corp. |
$ | 44,993 | $ | 41,240 | $ | 38,938 | $ | 40,384 | $ | 42,231 | ||||||||||
| Net income available to common shareholders |
44,378 | 40,625 | 38,323 | 39,591 | 41,400 | |||||||||||||||
| Net income per diluted common share |
0.48 | 0.44 | 0.42 | 0.43 | 0.45 | |||||||||||||||
| Return on average shareholders’ equity |
9.18 | % | 8.62 | % | 8.30 | % | 8.67 | % | 9.14 | % | ||||||||||
| Return on average tangible equity |
12.65 | 11.99 | 11.65 | 12.21 | 12.92 | |||||||||||||||
| Return on average assets |
0.92 | 0.86 | 0.82 | 0.88 | 0.94 | |||||||||||||||
| Noninterest income as a percentage of total revenue |
25.07 | 24.70 | 23.48 | 23.05 | 23.98 | |||||||||||||||
| Efficiency ratio |
62.25 | 63.75 | 65.63 | 65.83 | 62.22 | |||||||||||||||
| Asset quality: |
||||||||||||||||||||
| Allowance for loan losses |
$ | 186,089 | $ | 198,757 | $ | 210,288 | $ | 233,487 | $ | 257,352 | ||||||||||
| Nonperforming assets |
167,524 | 173,621 | 184,218 | 193,047 | 239,945 | |||||||||||||||
| Allowance for loan losses / total loans |
1.59 | % | 1.72 | % | 1.86 | % | 2.08 | % | 2.33 | % | ||||||||||
| Net charge-offs / average loans (annualized) |
0.61 | 0.58 | 0.96 | 0.95 | 1.05 | |||||||||||||||
| Nonperforming loans / total loans |
1.39 | 1.47 | 1.58 | 1.68 | 2.00 | |||||||||||||||
| Nonperforming assets / total loans plus OREO |
1.43 | 1.50 | 1.63 | 1.72 | 2.17 | |||||||||||||||
| Allowance for loan losses / nonperforming loans |
114.44 | 117.44 | 117.96 | 124.14 | 116.43 | |||||||||||||||
| Other ratios (annualized): |
||||||||||||||||||||
| Tangible equity ratio |
7.54 | % | 7.38 | % | 7.29 | % | 7.18 | % | 7.32 | % | ||||||||||
| Tangible common equity ratio |
7.39 | 7.22 | 7.14 | 7.03 | 7.16 | |||||||||||||||
| Tier 1 risk-based capital ratio (b) |
11.89 | 12.82 | 12.86 | 13.05 | 13.04 | |||||||||||||||
| Total risk-based capital (b) |
13.15 | 14.08 | 14.12 | 14.61 | 14.60 | |||||||||||||||
| Tier 1 common equity / risk-weighted assets (b) |
11.09 | 10.97 | 10.96 | 11.08 | 11.01 | |||||||||||||||
| Shareholders’ equity / total assets |
10.05 | 9.94 | 9.90 | 9.86 | 10.08 | |||||||||||||||
| Interest rate spread |
3.26 | 3.29 | 3.33 | 3.36 | 3.45 | |||||||||||||||
| Net interest margin |
3.28 | 3.32 | 3.36 | 3.39 | 3.49 | |||||||||||||||
| Share and equity related: |
||||||||||||||||||||
| Common equity |
$ | 1,954,739 | $ | 1,902,609 | $ | 1,866,003 | $ | 1,816,835 | $ | 1,807,330 | ||||||||||
| Book value per common share |
22.24 | 21.65 | 21.24 | 20.74 | 20.65 | |||||||||||||||
| Tangible book value per common share |
16.13 | 15.53 | 15.10 | 14.57 | 14.47 | |||||||||||||||
| Common stock closing price |
23.70 | 21.66 | 22.67 | 20.39 | 15.30 | |||||||||||||||
| Dividends declared per common share |
0.10 | 0.10 | 0.05 | 0.05 | 0.05 | |||||||||||||||
| Common shares outstanding |
87,899 | 87,885 | 87,849 | 87,600 | 87,507 | |||||||||||||||
| Basic shares (weighted average) |
87,394 | 87,291 | 87,216 | 87,097 | 87,046 | |||||||||||||||
| Diluted shares (weighted average) |
91,884 | 91,543 | 91,782 | 90,929 | 91,205 | |||||||||||||||
Footnotes:
| (a) | For purposes of the yield computation, unrealized gains (losses) on securities available for sale are excluded from the average balance. |
| (b) | The ratios presented are projected for September 30, 2012 and actual for the remaining periods presented. |
| (c) | Certain previously reported information has been corrected to reflect the deferment of certain commercial loan fees. |
WEBSTER FINANCIAL CORPORATION
Consolidated Balance Sheets (unaudited)
| (In thousands) |
September 30, 2012 |
June 30, 2012 |
September 30, 2011 |
|||||||||
| Assets: |
||||||||||||
| Cash and due from banks |
$ | 164,556 | $ | 197,229 | $ | 168,776 | ||||||
| Interest-bearing deposits |
79,763 | 73,598 | 87,240 | |||||||||
| Investment securities: |
||||||||||||
| Available for sale, at fair value |
3,120,354 | 3,153,580 | 2,500,151 | |||||||||
| Held to maturity |
3,142,160 | 3,076,226 | 3,106,013 | |||||||||
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| Total securities |
6,262,514 | 6,229,806 | 5,606,164 | |||||||||
| Loans held for sale |
91,207 | 89,228 | 28,266 | |||||||||
| Loans: |
||||||||||||
| Commercial |
3,138,807 | 2,985,993 | 2,841,242 | |||||||||
| Commercial real estate |
2,627,893 | 2,551,427 | 2,276,295 | |||||||||
| Residential mortgages |
3,292,948 | 3,300,617 | 3,150,286 | |||||||||
| Consumer |
2,668,004 | 2,701,960 | 2,782,263 | |||||||||
|
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|
|
|
|
|
|||||||
| Total loans |
11,727,652 | 11,539,997 | 11,050,086 | |||||||||
| Allowance for loan losses |
(186,089 | ) | (198,757 | ) | (257,352 | ) | ||||||
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|
|
|
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| Loans, net |
11,541,563 | 11,341,240 | 10,792,734 | |||||||||
| Prepaid FDIC premiums |
21,673 | 27,062 | 42,424 | |||||||||
| Federal Home Loan Bank and Federal Reserve Bank stock |
142,595 | 142,595 | 143,874 | |||||||||
| Premises and equipment, net |
135,394 | 137,420 | 148,274 | |||||||||
| Goodwill and other intangible assets, net |
541,399 | 542,783 | 546,974 | |||||||||
| Cash surrender value of life insurance policies |
414,797 | 312,117 | 305,901 | |||||||||
| Deferred tax asset, net |
74,098 | 79,011 | 98,588 | |||||||||
| Accrued interest receivable and other assets |
260,103 | 257,660 | 254,796 | |||||||||
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|
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|
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| Total Assets |
$ | 19,729,662 | $ | 19,429,749 | $ | 18,224,011 | ||||||
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| Liabilities and Equity: |
||||||||||||
| Deposits: |
||||||||||||
| Demand |
$ | 2,786,525 | $ | 2,611,297 | $ | 2,292,673 | ||||||
| Interest-bearing checking |
2,883,216 | 2,863,076 | 2,440,464 | |||||||||
| Money market |
2,340,717 | 1,934,137 | 2,225,841 | |||||||||
| Savings |
3,776,280 | 3,850,549 | 3,689,377 | |||||||||
| Certificates of deposit |
2,507,647 | 2,595,816 | 2,818,527 | |||||||||
| Brokered certificates of deposit |
119,052 | 119,052 | 119,052 | |||||||||
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|
|
|
|
|
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| Total deposits |
14,413,437 | 13,973,927 | 13,585,934 | |||||||||
| Securities sold under agreements to repurchase and other short-term borrowings |
1,310,015 | 1,203,378 | 1,220,905 | |||||||||
| Federal Home Loan Bank advances |
1,452,660 | 1,529,102 | 760,964 | |||||||||
| Long-term debt |
335,678 | 472,928 | 554,478 | |||||||||
| Accrued expenses and other liabilities |
234,194 | 318,866 | 255,884 | |||||||||
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|
|
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|
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| Total liabilities |
17,745,984 | 17,498,201 | 16,378,165 | |||||||||
| Webster Financial Corporation shareholders’ equity |
1,983,678 | 1,931,548 | 1,836,269 | |||||||||
| Noncontrolling interests |
— | — | 9,577 | |||||||||
|
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|
|
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|
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| Total equity |
1,983,678 | 1,931,548 | 1,845,846 | |||||||||
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|
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| Total Liabilities and Equity |
$ | 19,729,662 | $ | 19,429,749 | $ | 18,224,011 | ||||||
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See Selected Financial Highlights for footnotes.
WEBSTER FINANCIAL CORPORATION
Consolidated Statements of Operations (unaudited)
| Three Months Ended September |
Nine Months Ended September |
|||||||||||||||
| (In thousands, except per share data) |
2012 | 2011 | 2012 | 2011 | ||||||||||||
| Interest income: |
||||||||||||||||
| Interest and fees on loans and leases |
$ | 121,367 | $ | 121,322 | $ | 363,487 | $ | 365,660 | ||||||||
| Interest and dividends on securities |
50,194 | 52,974 | 155,659 | 160,345 | ||||||||||||
| Loans held for sale |
655 | 266 | 1,810 | 865 | ||||||||||||
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|
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|
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|
|||||||||
| Total interest income |
172,216 | 174,562 | 520,956 | 526,870 | ||||||||||||
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| Interest expense: |
||||||||||||||||
| Deposits |
14,543 | 18,930 | 45,701 | 63,540 | ||||||||||||
| Borrowings |
12,783 | 13,947 | 42,619 | 40,571 | ||||||||||||
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| Total interest expense |
27,326 | 32,877 | 88,320 | 104,111 | ||||||||||||
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|
|||||||||
| Net interest income |
144,890 | 141,685 | 432,636 | 422,759 | ||||||||||||
| Provision for loan losses |
5,000 | 5,000 | 14,000 | 20,000 | ||||||||||||
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|||||||||
| Net interest income after provision for loan losses |
139,890 | 136,685 | 418,636 | 402,759 | ||||||||||||
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| Noninterest income: |
||||||||||||||||
| Deposit service fees |
24,728 | 27,074 | 71,810 | 78,509 | ||||||||||||
| Loan related fees |
4,039 | 5,308 | 12,473 | 15,341 | ||||||||||||
| Wealth and investment services |
7,186 | 6,486 | 21,656 | 20,662 | ||||||||||||
| Mortgage banking activities |
6,515 | 1,324 | 14,522 | 3,811 | ||||||||||||
| Increase in cash surrender value of life insurance policies |
2,680 | 2,642 | 7,758 | 7,751 | ||||||||||||
| Net gain on investment securities |
810 | — | 3,347 | 2,024 | ||||||||||||
| Other income |
2,521 | 1,857 | 8,252 | 6,698 | ||||||||||||
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| Total noninterest income |
48,479 | 44,691 | 139,818 | 134,796 | ||||||||||||
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| Noninterest expense: |
||||||||||||||||
| Compensation and benefits |
66,126 | 61,897 | 198,332 | 194,501 | ||||||||||||
| Occupancy |
12,462 | 13,150 | 37,922 | 40,741 | ||||||||||||
| Technology and equipment expense |
15,118 | 15,141 | 46,721 | 45,667 | ||||||||||||
| Marketing |
4,529 | 4,144 | 13,723 | 13,916 | ||||||||||||
| Professional and outside services |
2,790 | 3,125 | 8,869 | 8,368 | ||||||||||||
| Intangible assets amortization |
1,384 | 1,397 | 4,178 | 4,191 | ||||||||||||
| Foreclosed and repossessed asset expenses |
118 | 726 | 761 | 2,320 | ||||||||||||
| Foreclosed and repossessed asset gains |
(409 | ) | (722 | ) | (1,743 | ) | (243 | ) | ||||||||
| Loan workout expenses |
1,693 | 2,012 | 5,718 | 5,591 | ||||||||||||
| Deposit insurance |
5,675 | 4,472 | 17,107 | 16,171 | ||||||||||||
| Other expenses |
13,805 | 14,392 | 42,238 | 43,032 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| 123,291 | 119,734 | 373,826 | 374,255 | |||||||||||||
| Debt prepayment penalties |
391 | — | 4,040 | — | ||||||||||||
| Write-down for expedited asset disposition |
— | — | — | 5,073 | ||||||||||||
| Contract termination and severance |
136 | 1,555 | 863 | 2,615 | ||||||||||||
| Branch and facility optimization |
69 | 2,183 | 150 | 3,315 | ||||||||||||
| Costs for warrant registration |
— | — | — | 350 | ||||||||||||
| Provision (benefit) for litigation and settlements |
— | (254 | ) | — | 232 | |||||||||||
| Loan repurchase and unfunded commitment reserve benefit, net |
— | — | — | (1,436 | ) | |||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Total noninterest expense |
123,887 | 123,218 | 378,879 | 384,404 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Income from continuing operations before income taxes |
64,482 | 58,158 | 179,575 | 153,151 | ||||||||||||
| Income tax expense |
19,489 | 15,927 | 54,404 | 44,152 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Income from continuing operations |
44,993 | 42,231 | 125,171 | 108,999 | ||||||||||||
| Income from discontinued operations, net of tax |
— | — | — | 1,995 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Consolidated net income |
44,993 | 42,231 | 125,171 | 110,994 | ||||||||||||
| Less: Net loss attributable to noncontrolling interests |
— | — | — | (1 | ) | |||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Net income attributable to Webster Financial Corp. |
44,993 | 42,231 | 125,171 | 110,995 | ||||||||||||
| Preferred stock dividends |
(615 | ) | (831 | ) | (1,845 | ) | (2,493 | ) | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Net income available to common shareholders |
$ | 44,378 | $ | 41,400 | $ | 123,326 | $ | 108,502 | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Diluted shares (weighted average) |
91,884 | 91,205 | 91,754 | 91,954 | ||||||||||||
| Net income per common share available to common shareholders: |
||||||||||||||||
| Basic |
||||||||||||||||
| Income from continuing operations |
$ | 0.51 | $ | 0.48 | $ | 1.41 | $ | 1.22 | ||||||||
| Net income |
0.51 | 0.48 | 1.41 | 1.24 | ||||||||||||
| Diluted |
||||||||||||||||
| Income from continuing operations |
0.48 | 0.45 | 1.34 | 1.15 | ||||||||||||
| Net income |
0.48 | 0.45 | 1.34 | 1.17 | ||||||||||||
See Selected Financial Highlights for footnotes.
WEBSTER FINANCIAL CORPORATION
Five Quarter Consolidated Statements of Operations (unaudited)
| Three Months Ended | ||||||||||||||||||||
| (In thousands, except per share data) |
Sept. 30, 2012 |
June 30, 2012 |
March 31, 2012 |
Dec. 31, 2011 |
Sept. 30, 2011 |
|||||||||||||||
| Interest income: |
||||||||||||||||||||
| Interest and fees on loans and leases |
$ | 121,367 | $ | 121,379 | $ | 120,741 | $ | 121,223 | $ | 121,322 | ||||||||||
| Interest and dividends on securities |
50,194 | 52,597 | 52,868 | 51,260 | 52,974 | |||||||||||||||
| Loans held for sale |
655 | 657 | 498 | 370 | 266 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Total interest income |
172,216 | 174,633 | 174,107 | 172,853 | 174,562 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Interest expense: |
||||||||||||||||||||
| Deposits |
14,543 | 15,102 | 16,056 | 17,268 | 18,930 | |||||||||||||||
| Borrowings |
12,783 | 15,153 | 14,683 | 14,576 | 13,947 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Total interest expense |
27,326 | 30,255 | 30,739 | 31,844 | 32,877 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Net interest income |
144,890 | 144,378 | 143,368 | 141,009 | 141,685 | |||||||||||||||
| Provision for loan losses |
5,000 | 5,000 | 4,000 | 2,500 | 5,000 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Net interest income after provision for loan losses |
139,890 | 139,378 | 139,368 | 138,509 | 136,685 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Noninterest income: |
||||||||||||||||||||
| Deposit service fees |
24,728 | 23,719 | 23,363 | 24,286 | 27,074 | |||||||||||||||
| Loan related fees |
4,039 | 3,565 | 4,869 | 4,896 | 5,308 | |||||||||||||||
| Wealth and investment services |
7,186 | 7,249 | 7,221 | 5,759 | 6,486 | |||||||||||||||
| Mortgage banking activities |
6,515 | 3,624 | 4,383 | 1,094 | 1,324 | |||||||||||||||
| Increase in cash surrender value of life insurance policies |
2,680 | 2,561 | 2,517 | 2,609 | 2,642 | |||||||||||||||
| Net gain on investment securities |
810 | 2,537 | — | — | — | |||||||||||||||
| Other income |
2,521 | 4,098 | 1,633 | 3,602 | 1,857 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Total noninterest income |
48,479 | 47,353 | 43,986 | 42,246 | 44,691 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Noninterest expense: |
||||||||||||||||||||
| Compensation and benefits |
66,126 | 63,587 | 68,619 | 68,146 | 61,897 | |||||||||||||||
| Occupancy |
12,462 | 12,578 | 12,882 | 13,125 | 13,150 | |||||||||||||||
| Technology and equipment expense |
15,118 | 16,021 | 15,582 | 15,054 | 15,141 | |||||||||||||||
| Marketing |
4,529 | 5,094 | 4,100 | 4,540 | 4,144 | |||||||||||||||
| Professional and outside services |
2,790 | 3,387 | 2,692 | 2,835 | 3,125 | |||||||||||||||
| Intangible assets amortization |
1,384 | 1,397 | 1,397 | 1,397 | 1,397 | |||||||||||||||
| Foreclosed and repossessed asset expenses |
118 | 176 | 467 | 730 | 726 | |||||||||||||||
| Foreclosed and repossessed asset gains |
(409 | ) | (670 | ) | (664 | ) | (63 | ) | (722 | ) | ||||||||||
| Loan workout expenses |
1,693 | 2,201 | 1,824 | 1,956 | 2,012 | |||||||||||||||
| Deposit insurance |
5,675 | 5,723 | 5,709 | 4,756 | 4,472 | |||||||||||||||
| Other expenses |
13,805 | 14,443 | 13,990 | 12,864 | 14,392 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| 123,291 | 123,937 | 126,598 | 125,340 | 119,734 | ||||||||||||||||
| Debt prepayment penalties |
391 | 2,515 | 1,134 | 5,203 | — | |||||||||||||||
| Write-down for expedited asset disposition |
— | — | — | 1,187 | — | |||||||||||||||
| Contract termination and severance |
136 | 727 | — | 2,485 | 1,555 | |||||||||||||||
| Branch and facility optimization |
69 | — | 81 | 1,689 | 2,183 | |||||||||||||||
| Preferred stock redemption costs |
— | — | — | 423 | — | |||||||||||||||
| Provision (benefit) for litigation and settlements |
— | — | — | (9,755 | ) | (254 | ) | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Total noninterest expense |
123,887 | 127,179 | 127,813 | 126,572 | 123,218 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Income from continuing operations before income taxes |
64,482 | 59,552 | 55,541 | 54,183 | 58,158 | |||||||||||||||
| Income tax expense |
19,489 | 18,312 | 16,603 | 13,799 | 15,927 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Income from continuing operations |
44,993 | 41,240 | 38,938 | 40,384 | 42,231 | |||||||||||||||
| Income from discontinued operations, net of tax |
— | — | — | — | — | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Consolidated net income |
44,993 | 41,240 | 38,938 | 40,384 | 42,231 | |||||||||||||||
| Less: Net loss attributable to noncontrolling interests |
— | — | — | — | — | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Net income attributable to Webster Financial Corp. |
44,993 | 41,240 | 38,938 | 40,384 | 42,231 | |||||||||||||||
| Preferred stock dividends |
(615 | ) | (615 | ) | (615 | ) | (793 | ) | (831 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Net income available to common shareholders |
$ | 44,378 | $ | 40,625 | $ | 38,323 | $ | 39,591 | $ | 41,400 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Diluted shares (weighted average) |
91,884 | 91,543 | 91,782 | 90,929 | 91,205 | |||||||||||||||
| Net income per common share available to common shareholders: |
||||||||||||||||||||
| Basic |
||||||||||||||||||||
| Income from continuing operations |
$ | 0.51 | $ | 0.46 | $ | 0.44 | $ | 0.45 | $ | 0.48 | ||||||||||
| Net income |
0.51 | 0.46 | 0.44 | 0.45 | 0.48 | |||||||||||||||
| Diluted |
||||||||||||||||||||
| Income from continuing operations |
0.48 | 0.44 | 0.42 | 0.43 | 0.45 | |||||||||||||||
| Net income |
0.48 | 0.44 | 0.42 | 0.43 | 0.45 | |||||||||||||||
See Selected Financial Highlights for footnotes.
WEBSTER FINANCIAL CORPORATION
Five Quarter Interest Rate Spreads and Margin (unaudited)
| Three Months Ended | ||||||||||||||||||||
| September 30, | June 30, | March 31, | December 31, | September 30, | ||||||||||||||||
| 2012 | 2012 | 2012 | 2011 | 2011 | ||||||||||||||||
| Interest rate spread |
||||||||||||||||||||
| Yield on interest-earning assets |
3.88 | % | 4.00 | % | 4.06 | % | 4.13 | % | 4.27 | % | ||||||||||
| Cost of interest-bearing liabilities |
0.62 | 0.71 | 0.73 | 0.77 | 0.82 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Interest rate spread |
3.26 | % | 3.29 | % | 3.33 | % | 3.36 | % | 3.45 | % | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Net interest margin |
3.28 | % | 3.32 | % | 3.36 | % | 3.39 | % | 3.49 | % | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Consolidated Average Balances, Yields, and Rates Paid (unaudited)
| Three Months Ended September 30, |
2012 | 2011 (c) | ||||||||||||||||||||||
| (Dollars in thousands) |
Average balance |
Interest | Fully tax- equivalent yield/rate |
Average balance |
Interest | Fully tax- equivalent yield/rate |
||||||||||||||||||
| Assets: |
||||||||||||||||||||||||
| Interest-earning assets: |
||||||||||||||||||||||||
| Loans |
$ | 11,608,334 | $ | 121,367 | 4.14 | % | $ | 11,023,674 | $ | 121,322 | 4.36 | % | ||||||||||||
| Investment securities (a) |
6,145,414 | 53,010 | 3.48 | 5,344,987 | 55,916 | 4.22 | ||||||||||||||||||
| Loans held for sale |
82,006 | 655 | 3.19 | 25,593 | 266 | 4.17 | ||||||||||||||||||
| Federal Home Loan and Federal Reserve Bank stock |
142,595 | 879 | 2.45 | 143,874 | 823 | 2.27 | ||||||||||||||||||
| Interest-bearing deposits |
91,502 | 45 | 0.19 | 89,273 | 33 | 0.14 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| Total interest-earning assets |
18,069,851 | 175,956 | 3.88 | 16,627,401 | 178,360 | 4.27 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||||||||||
| Noninterest-earning assets |
1,420,460 | 1,326,641 | ||||||||||||||||||||||
|
|
|
|
|
|||||||||||||||||||||
| Total assets |
$ | 19,490,311 | $ | 17,954,042 | ||||||||||||||||||||
|
|
|
|
|
|||||||||||||||||||||
| Liabilities and Shareholders’ Equity: |
||||||||||||||||||||||||
| Interest-bearing liabilities: |
||||||||||||||||||||||||
| Deposits: |
||||||||||||||||||||||||
| Demand |
2,726,790 | $ | — | — | % | $ | 2,358,392 | $ | — | — | % | |||||||||||||
| Savings, interest checking, and money market |
8,935,878 | 5,137 | 0.23 | 8,402,300 | 7,308 | 0.35 | ||||||||||||||||||
| Certificates of deposit |
2,677,939 | 9,406 | 1.40 | 2,997,188 | 11,622 | 1.54 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| Total deposits |
14,340,607 | 14,543 | 0.40 | 13,757,880 | 18,930 | 0.55 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| Securities sold under agreements to repurchase and other short-term borrowings |
1,171,787 | 5,594 | 1.87 | 1,112,177 | 4,384 | 1.54 | ||||||||||||||||||
| Federal Home Loan Bank advances |
1,433,037 | 3,942 | 1.08 | 465,475 | 3,551 | 2.99 | ||||||||||||||||||
| Long-term debt |
361,468 | 3,247 | 3.59 | 557,585 | 6,012 | 4.31 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| Total borrowings |
2,966,292 | 12,783 | 1.70 | 2,135,237 | 13,947 | 2.58 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| Total interest-bearing liabilities |
17,306,899 | 27,326 | 0.62 | 15,893,117 | 32,877 | 0.82 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||||||||||
| Noninterest-bearing liabilities |
222,929 | 202,682 | ||||||||||||||||||||||
|
|
|
|
|
|||||||||||||||||||||
| Total liabilities |
17,529,828 | 16,095,799 | ||||||||||||||||||||||
| Noncontrolling interests |
— | 9,577 | ||||||||||||||||||||||
| Webster Financial Corp. shareholders’ equity |
1,960,483 | 1,848,666 | ||||||||||||||||||||||
|
|
|
|
|
|||||||||||||||||||||
| Total liabilities and equity |
$ | 19,490,311 | $ | 17,954,042 | ||||||||||||||||||||
|
|
|
|
|
|||||||||||||||||||||
| Tax-equivalent net interest income |
148,630 | 145,483 | ||||||||||||||||||||||
| Less: tax-equivalent adjustment |
(3,740 | ) | (3,798 | ) | ||||||||||||||||||||
|
|
|
|
|
|||||||||||||||||||||
| Net interest income |
$ | 144,890 | $ | 141,685 | ||||||||||||||||||||
|
|
|
|
|
|||||||||||||||||||||
| Interest rate spread |
3.26 | % | 3.45 | % | ||||||||||||||||||||
|
|
|
|
|
|||||||||||||||||||||
| Net interest margin |
3.28 | % | 3.49 | % | ||||||||||||||||||||
|
|
|
|
|
|||||||||||||||||||||
See Selected Financial Highlights for footnotes.
WEBSTER FINANCIAL CORPORATION
Consolidated Average Balances, Yields, and Rates Paid (unaudited)
| Nine Months Ended September 30, |
2012 | 2011 (c) | ||||||||||||||||||||||
| (Dollars in thousands) |
Average balance |
Interest | Fully tax- equivalent yield/rate |
Average balance |
Interest | Fully tax- equivalent yield/rate |
||||||||||||||||||
| Assets: |
||||||||||||||||||||||||
| Interest-earning assets: |
||||||||||||||||||||||||
| Loans |
$ | 11,435,430 | $ | 363,487 | 4.21 | % | $ | 11,024,732 | $ | 365,660 | 4.40 | % | ||||||||||||
| Investment securities (a) |
6,076,750 | 164,187 | 3.63 | 5,330,255 | 169,155 | 4.27 | ||||||||||||||||||
| Loans held for sale |
67,411 | 1,810 | 3.58 | 25,725 | 865 | 4.49 | ||||||||||||||||||
| Federal Home Loan and Federal Reserve Bank stock |
142,912 | 2,636 | 2.46 | 143,874 | 2,486 | 2.31 | ||||||||||||||||||
| Interest-bearing deposits |
78,852 | 107 | 0.18 | 121,020 | 190 | 0.21 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| Total interest-earning assets |
17,801,355 | 532,227 | 3.98 | 16,645,606 | 538,356 | 4.31 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||||||||||
| Noninterest-earning assets |
1,399,566 | 1,325,336 | ||||||||||||||||||||||
|
|
|
|
|
|||||||||||||||||||||
| Total assets |
$ | 19,200,921 | $ | 17,970,942 | ||||||||||||||||||||
|
|
|
|
|
|||||||||||||||||||||
| Liabilities and Shareholders’ Equity: |
||||||||||||||||||||||||
| Interest-bearing liabilities: |
||||||||||||||||||||||||
| Deposits: |
||||||||||||||||||||||||
| Demand |
$ | 2,572,851 | $ | — | — | % | $ | 2,249,378 | $ | — | — | % | ||||||||||||
| Savings, interest checking, and money market |
8,747,401 | 16,216 | 0.25 | 8,572,577 | 27,445 | 0.43 | ||||||||||||||||||
| Certificates of deposit |
2,739,829 | 29,485 | 1.44 | 3,076,384 | 36,095 | 1.57 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| Total deposits |
14,060,081 | 45,701 | 0.43 | 13,898,339 | 63,540 | 0.61 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| Securities sold under agreements to repurchase and other short-term borrowings |
1,182,817 | 15,388 | 1.71 | 999,843 | 11,723 | 1.55 | ||||||||||||||||||
| Federal Home Loan Bank advances |
1,380,393 | 12,932 | 1.23 | 474,094 | 10,201 | 2.84 | ||||||||||||||||||
| Long-term debt |
447,082 | 14,299 | 4.26 | 569,256 | 18,647 | 4.37 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| Total borrowings |
3,010,292 | 42,619 | 1.87 | 2,043,193 | 40,571 | 2.63 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| Total interest-bearing liabilities |
17,070,373 | 88,320 | 0.69 | 15,941,532 | 104,111 | 0.87 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||||||||||
| Noninterest-bearing liabilities |
213,196 | 195,830 | ||||||||||||||||||||||
|
|
|
|
|
|||||||||||||||||||||
| Total liabilities |
17,283,569 | 16,137,362 | ||||||||||||||||||||||
| Noncontrolling interests |
— | 9,596 | ||||||||||||||||||||||
| Webster Financial Corporation shareholders’ equity |
1,917,352 | 1,823,984 | ||||||||||||||||||||||
|
|
|
|
|
|||||||||||||||||||||
| Total liabilities and equity |
$ | 19,200,921 | $ | 17,970,942 | ||||||||||||||||||||
|
|
|
|
|
|||||||||||||||||||||
| Tax-equivalent net interest income |
443,907 | 434,245 | ||||||||||||||||||||||
| Less: tax-equivalent adjustment |
(11,271 | ) | (11,486 | ) | ||||||||||||||||||||
|
|
|
|
|
|||||||||||||||||||||
| Net interest income |
$ | 432,636 | $ | 422,759 | ||||||||||||||||||||
|
|
|
|
|
|||||||||||||||||||||
| Interest rate spread |
3.29 | % | 3.44 | % | ||||||||||||||||||||
|
|
|
|
|
|||||||||||||||||||||
| Net interest margin |
3.32 | % | 3.48 | % | ||||||||||||||||||||
|
|
|
|
|
|||||||||||||||||||||
See Selected Financial Highlights for footnotes.
WEBSTER FINANCIAL CORPORATION
Five Quarter Loan Balances (unaudited)
| (Dollars in thousands) |
Sept. 30, 2012 |
June 30, 2012 |
March 31, 2012 |
Dec. 31, 2011 |
Sept. 30, 2011 |
|||||||||||||||
| Loan Balances (actuals): |
||||||||||||||||||||
| Continuing Portfolio: |
||||||||||||||||||||
| Commercial non-mortgage |
$ | 2,201,732 | $ | 2,069,127 | $ | 1,972,205 | $ | 1,932,542 | $ | 1,812,685 | ||||||||||
| Equipment financing |
401,748 | 417,654 | 446,585 | 474,804 | 518,369 | |||||||||||||||
| Asset based lending |
535,327 | 499,212 | 470,187 | 453,251 | 510,188 | |||||||||||||||
| Commercial real estate |
2,597,835 | 2,518,392 | 2,389,206 | 2,345,241 | 2,225,250 | |||||||||||||||
| Residential development |
30,058 | 33,035 | 36,591 | 39,648 | 51,045 | |||||||||||||||
| Residential mortgages |
3,292,947 | 3,300,616 | 3,270,212 | 3,219,888 | 3,150,285 | |||||||||||||||
| Consumer |
2,537,039 | 2,565,654 | 2,585,685 | 2,612,476 | 2,627,385 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Total continuing |
11,596,686 | 11,403,690 | 11,170,671 | 11,077,850 | 10,895,207 | |||||||||||||||
| Allowance for loan losses |
(156,214 | ) | (168,882 | ) | (180,413 | ) | (203,612 | ) | (227,477 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Total continuing, net |
11,440,472 | 11,234,808 | 10,990,258 | 10,874,238 | 10,667,730 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Liquidating Portfolio: |
||||||||||||||||||||
| National Construction Lending Center (NCLC) |
1 | 1 | 1 | 1 | 1 | |||||||||||||||
| Consumer |
130,965 | 136,306 | 141,478 | 147,553 | 154,878 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Total liquidating portfolio |
130,966 | 136,307 | 141,479 | 147,554 | 154,879 | |||||||||||||||
| Allowance for loan losses |
(29,875 | ) | (29,875 | ) | (29,875 | ) | (29,875 | ) | (29,875 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Total liquidating, net |
101,091 | 106,432 | 111,604 | 117,679 | 125,004 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Total Loan Balances (actuals) |
11,727,652 | 11,539,997 | 11,312,150 | 11,225,404 | 11,050,086 | |||||||||||||||
| Allowance for loan losses |
(186,089 | ) | (198,757 | ) | (210,288 | ) | (233,487 | ) | (257,352 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Loans, net |
$ | 11,541,563 | $ | 11,341,240 | $ | 11,101,862 | $ | 10,991,917 | $ | 10,792,734 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Loan Balances (average): |
||||||||||||||||||||
| Continuing Portfolio: |
||||||||||||||||||||
| Commercial non-mortgage |
$ | 2,137,882 | $ | 2,008,778 | $ | 1,970,656 | $ | 1,868,885 | $ | 1,798,644 | ||||||||||
| Equipment financing |
404,180 | 430,882 | 458,111 | 495,667 | 551,732 | |||||||||||||||
| Asset based lending |
520,100 | 480,574 | 474,264 | 492,982 | 497,426 | |||||||||||||||
| Commercial real estate |
2,528,394 | 2,453,430 | 2,336,576 | 2,254,970 | 2,185,662 | |||||||||||||||
| Residential development |
31,484 | 35,422 | 38,401 | 49,182 | 51,051 | |||||||||||||||
| Residential mortgages |
3,300,067 | 3,296,306 | 3,253,199 | 3,186,885 | 3,145,086 | |||||||||||||||
| Consumer |
2,552,660 | 2,576,521 | 2,598,758 | 2,622,378 | 2,635,911 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Total continuing |
11,474,767 | 11,281,913 | 11,129,965 | 10,970,949 | 10,865,512 | |||||||||||||||
| Allowance for loan losses |
(167,469 | ) | (179,139 | ) | (201,592 | ) | (219,566 | ) | (247,551 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Total continuing, net |
11,307,298 | 11,102,774 | 10,928,373 | 10,751,383 | 10,617,961 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Liquidating Portfolio: |
||||||||||||||||||||
| NCLC |
1 | 1 | 1 | 1 | 1 | |||||||||||||||
| Consumer |
133,566 | 138,807 | 145,367 | 151,422 | 158,161 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Total liquidating portfolio |
133,567 | 138,808 | 145,368 | 151,423 | 158,162 | |||||||||||||||
| Allowance for loan losses |
(29,875 | ) | (29,875 | ) | (29,875 | ) | (29,875 | ) | (29,875 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Total liquidating, net |
103,692 | 108,933 | 115,493 | 121,548 | 128,287 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Total Loan Balances (average) |
11,608,334 | 11,420,721 | 11,275,333 | 11,122,372 | 11,023,674 | |||||||||||||||
| Allowance for loan losses |
(197,344 | ) | (209,014 | ) | (231,467 | ) | (249,441 | ) | (277,426 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Loans, net |
$ | 11,410,990 | $ | 11,211,707 | $ | 11,043,866 | $ | 10,872,931 | $ | 10,746,248 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
See Selected Financial Highlights for footnotes.
WEBSTER FINANCIAL CORPORATION
Five Quarter Nonperforming Assets (unaudited)
| (Dollars in thousands) |
Sept. 30, 2012 |
June 30, 2012 |
March 31, 2012 |
Dec. 31, 2011 |
Sept. 30, 2011 |
|||||||||||||||
| Nonperforming loans: |
||||||||||||||||||||
| Continuing Portfolio: |
||||||||||||||||||||
| Commercial non-mortgage |
$ | 30,315 | $ | 29,271 | $ | 31,547 | $ | 27,884 | $ | 39,386 | ||||||||||
| Equipment financing |
3,052 | 5,862 | 4,868 | 7,154 | 8,439 | |||||||||||||||
| Asset based lending |
92 | 262 | 1,475 | 1,880 | 5,126 | |||||||||||||||
| Commercial real estate |
15,768 | 23,457 | 25,131 | 32,197 | 42,461 | |||||||||||||||
| Residential development |
5,431 | 5,982 | 6,140 | 6,762 | 16,611 | |||||||||||||||
| Residential mortgages |
79,736 | 77,336 | 79,110 | 82,052 | 79,285 | |||||||||||||||
| Consumer |
23,602 | 22,616 | 26,098 | 25,059 | 24,228 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Nonperforming loans - continuing portfolio |
157,996 | 164,786 | 174,369 | 182,988 | 215,536 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Liquidating Portfolio: |
||||||||||||||||||||
| Consumer |
4,616 | 4,460 | 3,896 | 5,091 | 5,492 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Nonperforming loans - liquidating portfolio |
4,616 | 4,460 | 3,896 | 5,091 | 5,492 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Total nonperforming loans |
$ | 162,612 | $ | 169,246 | $ | 178,265 | $ | 188,079 | $ | 221,028 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Other real estate owned and repossessed assets: |
||||||||||||||||||||
| Continuing Portfolio: |
||||||||||||||||||||
| Commercial |
$ | 917 | $ | 917 | $ | 2,051 | $ | 1,961 | $ | 12,961 | ||||||||||
| Repossessed equipment |
1,840 | 721 | 674 | 123 | 1,421 | |||||||||||||||
| Residential |
1,705 | 2,271 | 2,648 | 1,947 | 3,343 | |||||||||||||||
| Consumer |
450 | 466 | 580 | 805 | 1,021 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Total continuing |
4,912 | 4,375 | 5,953 | 4,836 | 18,746 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Liquidating Portfolio: |
||||||||||||||||||||
| NCLC |
— | — | — | 132 | 171 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Total liquidating |
— | — | — | 132 | 171 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Total other real estate owned and repossessed assets |
$ | 4,912 | $ | 4,375 | $ | 5,953 | $ | 4,968 | $ | 18,917 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Total nonperforming assets |
$ | 167,524 | $ | 173,621 | $ | 184,218 | $ | 193,047 | $ | 239,945 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
See Selected Financial Highlights for footnotes.
WEBSTER FINANCIAL CORPORATION
Five Quarter Past Due Loans (unaudited)
| (Dollars in thousands) |
Sept. 30, 2012 |
June 30, 2012 |
March 31, 2012 |
Dec. 31, 2011 |
Sept. 30, 2011 |
|||||||||||||||
| Past due 30-89 days: |
||||||||||||||||||||
| Accruing loans: |
||||||||||||||||||||
| Continuing Portfolio: |
||||||||||||||||||||
| Commercial non-mortgage |
$ | 4,424 | $ | 6,479 | $ | 6,938 | $ | 4,619 | $ | 7,428 | ||||||||||
| Equipment financing |
3,524 | 1,665 | 4,099 | 4,800 | 5,054 | |||||||||||||||
| Asset based lending |
— | — | — | — | — | |||||||||||||||
| Commercial real estate |
7,136 | 3,152 | 1,101 | 1,766 | 2,969 | |||||||||||||||
| Residential development |
317 | — | — | — | 664 | |||||||||||||||
| Residential mortgages |
22,230 | 26,966 | 22,915 | 24,361 | 23,730 | |||||||||||||||
| Consumer |
24,664 | 22,163 | 19,592 | 20,847 | 18,867 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Past Due 30-89 days - continuing portfolio |
62,295 | 60,425 | 54,645 | 56,393 | 58,712 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Liquidating Portfolio: |
||||||||||||||||||||
| Consumer |
4,909 | 4,377 | 5,263 | 4,538 | 4,653 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Past Due 30-89 days - liquidating portfolio |
4,909 | 4,377 | 5,263 | 4,538 | 4,653 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Accruing loans past due 90 days or more |
205 | 1,074 | 43 | 724 | 764 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Total past due loans |
$ | 67,409 | $ | 65,876 | $ | 59,951 | $ | 61,655 | $ | 64,129 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
See Selected Financial Highlights for footnotes.
WEBSTER FINANCIAL CORPORATION
Five Quarter Changes in the Allowance for Loan Losses (unaudited)
| For the Three Months Ended | ||||||||||||||||||||
| (Dollars in thousands) |
Sept. 30, 2012 |
June 30, 2012 |
March 31, 2012 |
Dec. 31, 2011 |
Sept. 30, 2011 |
|||||||||||||||
| Beginning balance |
$ | 198,757 | $ | 210,288 | $ | 233,487 | $ | 257,352 | $ | 281,243 | ||||||||||
| Provision |
5,000 | 5,000 | 4,000 | 2,500 | 5,000 | |||||||||||||||
| Charge-offs continuing portfolio: |
||||||||||||||||||||
| Commercial non-mortgage |
8,642 | 5,164 | 14,994 | 6,684 | 11,311 | |||||||||||||||
| Equipment financing |
187 | 165 | 634 | 55 | 551 | |||||||||||||||
| Asset based lending |
— | 512 | — | 2,150 | 3,317 | |||||||||||||||
| Commercial real estate |
2,655 | 1,066 | 5,848 | 7,768 | 3,377 | |||||||||||||||
| Residential development |
— | — | — | 453 | — | |||||||||||||||
| Residential mortgages |
3,234 | 3,948 | 3,115 | 2,548 | 2,591 | |||||||||||||||
| Consumer |
6,752 | 8,122 | 6,487 | 7,551 | 8,874 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Charge-offs continuing portfolio |
21,470 | 18,977 | 31,078 | 27,209 | 30,021 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Charge-offs liquidating portfolio: |
||||||||||||||||||||
| NCLC |
28 | 4 | — | 7 | 61 | |||||||||||||||
| Consumer |
2,482 | 3,227 | 3,564 | 3,958 | 3,734 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Charge-offs liquidating portfolio |
2,510 | 3,231 | 3,564 | 3,965 | 3,795 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Total charge-offs |
23,980 | 22,208 | 34,642 | 31,174 | 33,816 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Recoveries continuing portfolio: |
||||||||||||||||||||
| Commercial non-mortgage |
779 | 957 | 886 | 1,215 | 858 | |||||||||||||||
| Equipment financing |
3,111 | 1,115 | 2,348 | 1,161 | 2,240 | |||||||||||||||
| Asset based lending |
518 | 721 | 914 | 195 | 273 | |||||||||||||||
| Commercial real estate |
121 | 34 | 1,069 | 96 | 36 | |||||||||||||||
| Residential development |
181 | 12 | 31 | 5 | — | |||||||||||||||
| Residential mortgages |
318 | 126 | 118 | 135 | 357 | |||||||||||||||
| Consumer |
933 | 2,453 | 1,932 | 1,721 | 998 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Recoveries continuing portfolio |
5,961 | 5,418 | 7,298 | 4,528 | 4,762 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Recoveries liquidating portfolio: |
||||||||||||||||||||
| NCLC |
35 | 10 | 23 | 177 | 17 | |||||||||||||||
| Consumer |
316 | 249 | 122 | 104 | 146 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Recoveries liquidating portfolio |
351 | 259 | 145 | 281 | 163 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Total recoveries |
6,312 | 5,677 | 7,443 | 4,809 | 4,925 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Total net charge-offs |
17,668 | 16,531 | 27,199 | 26,365 | 28,891 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Ending balance |
$ | 186,089 | $ | 198,757 | $ | 210,288 | $ | 233,487 | $ | 257,352 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
See Selected Financial Highlights for footnotes.
WEBSTER FINANCIAL CORPORATION
Reconciliations to GAAP Financial Measures
The Company evaluates its business based on the following ratios that utilize tangible equity, a non-GAAP financial measure. Return on average tangible equity measures the Company’s earnings contribution as a percentage of average shareholders’ equity less goodwill and intangible assets (excluding mortgage servicing rights), net of related deferred tax liabilities on intangible assets. The tangible equity ratio represents total ending shareholders’ equity less goodwill and intangible assets (excluding mortgage servicing rights), net of related deferred tax liabilities divided by total assets less goodwill and intangible assets (excluding mortgage servicing rights), net of related deferred tax liabilities on intangible assets. The tangible common equity ratio represents ending common shareholders’ equity less goodwill and intangible assets (excluding mortgage servicing rights), net of related deferred tax liabilities divided by total assets less goodwill and intangible assets (excluding mortgage servicing rights), net of related deferred tax liabilities on intangible assets. Tangible book value per common share represents ending common shareholders’ equity less goodwill and intangible assets (excluding mortgage servicing rights), net of related deferred tax liabilities on intangible assets divided by ending common shares outstanding.
The efficiency ratio, which measures the costs expended to generate a dollar of revenue, is calculated excluding foreclosed property expense, amortization of intangibles, gain or loss on securities, and other non-recurring items. Accordingly, this is also a non-GAAP financial measure.
See the tables below for reconciliations of these non-GAAP financial measures with financial measures defined by GAAP for the three months ended September 30, 2012, June 30, 2012, March 31, 2012, December 31, 2011, and September 30, 2011. The Company believes the use of these non-GAAP financial measures provides additional clarity in assessing the results of the Company. Other companies may define or calculate supplemental financial data differently.
| Three Months Ended | ||||||||||||||||||||
| (Dollars in thousands) | Sept.
30, 2012 |
June
30, 2012 |
March
31, 2012 |
Dec. 31, 2011 |
Sept. 30, 2011 |
|||||||||||||||
| Reconciliation of average shareholders’ equity to average tangible shareholders’ equity |
||||||||||||||||||||
| Average shareholders’ equity |
$ | 1,960,483 | $ | 1,914,325 | $ | 1,876,774 | $ | 1,863,691 | $ | 1,848,666 | ||||||||||
| Average goodwill |
(529,887 | ) | (529,887 | ) | (529,887 | ) | (529,887 | ) | (529,887 | ) | ||||||||||
| Average intangible assets (excluding mortgage servicing rights) |
(12,188 | ) | (13,576 | ) | (14,973 | ) | (16,368 | ) | (17,771 | ) | ||||||||||
| Average related deferred tax liabilities |
4,364 | 4,862 | 5,362 | 5,729 | 6,220 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Average tangible shareholders’ equity |
$ | 1,422,772 | $ | 1,375,724 | $ | 1,337,276 | $ | 1,323,165 | $ | 1,307,228 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Reconciliation of period-end shareholders’ equity to period-end tangible shareholders’ equity |
||||||||||||||||||||
| Shareholders’ equity |
$ | 1,983,678 | $ | 1,931,548 | $ | 1,894,942 | $ | 1,845,774 | $ | 1,836,269 | ||||||||||
| Goodwill |
(529,887 | ) | (529,887 | ) | (529,887 | ) | (529,887 | ) | (529,887 | ) | ||||||||||
| Intangible assets (excluding mortgage servicing rights) |
(11,512 | ) | (12,896 | ) | (14,293 | ) | (15,690 | ) | (17,086 | ) | ||||||||||
| Related deferred tax liabilities |
4,123 | 4,618 | 5,119 | 5,492 | 5,980 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Tangible shareholders’ equity |
$ | 1,446,402 | $ | 1,393,383 | $ | 1,355,881 | $ | 1,305,689 | $ | 1,295,276 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Reconciliation of period-end common shareholders’ equity to period-end tangible common shareholders’ equity |
||||||||||||||||||||
| Common shareholders’ equity |
$ | 1,954,739 | $ | 1,902,609 | $ | 1,866,003 | $ | 1,816,835 | $ | 1,807,330 | ||||||||||
| Goodwill |
(529,887 | ) | (529,887 | ) | (529,887 | ) | (529,887 | ) | (529,887 | ) | ||||||||||
| Intangible assets (excluding mortgage servicing rights) |
(11,512 | ) | (12,896 | ) | (14,293 | ) | (15,690 | ) | (17,086 | ) | ||||||||||
| Related deferred tax liabilities |
4,123 | 4,618 | 5,119 | 5,492 | 5,980 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
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| Tangible common shareholders’ equity |
$ | 1,417,463 | $ | 1,364,444 | $ | 1,326,942 | $ | 1,276,750 | $ | 1,266,337 | ||||||||||
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| Reconciliation of period-end assets to period-end tangible assets |
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| Assets |
$ | 19,729,662 | $ | 19,429,749 | $ | 19,134,142 | $ | 18,714,340 | $ | 18,224,011 | ||||||||||
| Goodwill |
(529,887 | ) | (529,887 | ) | (529,887 | ) | (529,887 | ) | (529,887 | ) | ||||||||||
| Intangible assets (excluding mortgage servicing rights) |
(11,512 | ) | (12,896 | ) | (14,293 | ) | (15,690 | ) | (17,086 | ) | ||||||||||
| Related deferred tax liabilities |
4,123 | 4,618 | 5,119 | 5,492 | 5,980 | |||||||||||||||
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| Tangible assets |
$ | 19,192,386 | $ | 18,891,584 | $ | 18,595,081 | $ | 18,174,255 | $ | 17,683,018 | ||||||||||
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| Book value per common share |
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| Common shareholders’ equity |
$ | 1,954,739 | $ | 1,902,609 | $ | 1,866,003 | $ | 1,816,835 | $ | 1,807,330 | ||||||||||
| Ending common shares issued and outstanding (in thousands) |
87,899 | 87,885 | 87,849 | 87,600 | 87,507 | |||||||||||||||
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| Book value per share of common stock |
$ | 22.24 | $ | 21.65 | $ | 21.24 | $ | 20.74 | $ | 20.65 | ||||||||||
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WEBSTER FINANCIAL CORPORATION
Reconciliations to GAAP Financial Measures (continued)
| Three Months Ended | ||||||||||||||||||||
| (Dollars in thousands) | Sept.
30, 2012 |
June
30, 2012 |
March
31, 2012 |
Dec. 31, 2011 |
Sept. 30, 2011 |
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| Tangible book value per common share |
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| Tangible common shareholders’ equity |
$ | 1,417,463 | $ | 1,364,444 | $ | 1,326,942 | $ | 1,276,750 | $ | 1,266,337 | ||||||||||
| Ending common shares issued and outstanding (in thousands) |
87,899 | 87,885 | 87,849 | 87,600 | 87,507 | |||||||||||||||
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| Tangible book value per common share |
$ | 16.13 | $ | 15.53 | $ | 15.10 | $ | 14.57 | $ | 14.47 | ||||||||||
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| Reconciliation of noninterest expense to noninterest expense used in the efficiency ratio |
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| Noninterest expense |
$ | 123,887 | $ | 127,179 | $ | 127,813 | $ | 126,572 | $ | 123,218 | ||||||||||
| Foreclosed property expense |
(118 | ) | (176 | ) | (467 | ) | (730 | ) | (726 | ) | ||||||||||
| Amortization of intangibles |
(1,384 | ) | (1,397 | ) | (1,397 | ) | (1,397 | ) | (1,397 | ) | ||||||||||
| Other expense |
(187 | ) | (2,572 | ) | (551 | ) | (1,169 | ) | (2,762 | ) | ||||||||||
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| Noninterest expense used in the efficiency ratio |
$ | 122,198 | $ | 123,034 | $ | 125,398 | $ | 123,276 | $ | 118,333 | ||||||||||
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| Reconciliation of income to income used in the efficiency ratio |
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| Net interest income before provision |
$ | 144,890 | $ | 144,378 | $ | 143,368 | $ | 141,009 | $ | 141,685 | ||||||||||
| Fully taxable-equivalent adjustment |
3,740 | 3,813 | 3,718 | 4,011 | 3,798 | |||||||||||||||
| Noninterest income |
48,479 | 47,353 | 43,986 | 42,246 | 44,691 | |||||||||||||||
| Less: Net gain on investment securities |
(810 | ) | (2,537 | ) | — | — | — | |||||||||||||
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| Income used in the efficiency ratio |
$ | 196,299 | $ | 193,007 | $ | 191,072 | $ | 187,266 | $ | 190,174 | ||||||||||
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