EXHIBIT 99.2
PRESS RELEASE
|
| Contact: | Donald Fleming |
|
|
| Senior Vice President |
For release at 4:30 p.m. |
| Contact #: | (718) 697-2813 |
ANNOUNCEMENT: | STATEN ISLAND BANCORP INC. REPORTS FIRST QUARTER 2003 RESULTS |
Staten Island, New York – Staten Island Bancorp, Inc. (NYSE: SIB), (the “Company”), reported today that net income for the quarter ended March 31, 2003 was $25.4 million or $0.45 per diluted share.
This compares to net income of $10.0 million or $0.16 per diluted share as restated for the quarter ended March 31, 2002.
Commenting on the results, Harry P. Doherty, Chairman and Chief Executive Officer, stated “We are pleased to announce another very strong quarter for the Company. We continue to focus on building our retail banking network and note that our core deposit base expanded by 4.8% during the quarter or 19.2% on an annualized basis. On April 14th, we opened our third branch in Brooklyn, New York and we look forward to opening a fourth Brooklyn branch office later this year. We also plan to open an additional branch in Edison, New Jersey this year, increasing the number of our New Jersey locations to 16 offices. We are also pleased to note the continuing record volume in the quarter for our mortgage banking company, SIB Mortgage Corp. Application levels remain strong and we anticipate loan sales of approximately $4.0 billion in the second quarter.”
Financial Highlights:
• Net interest income increased $5.9 million or 12.4% to $53.8 million for the first quarter of 2003 compared to $47.9 million for the first quarter of 2002. The improvement in net interest income on a comparative quarter basis continued to be driven by the lower interest rate environment, growth in the Bank’s core deposit base and growth of the earning asset base. Average interest earning assets for the quarter ended March 31, 2003 were $6.5 billion compared to $5.7 billion for the quarter ended March 31, 2002, representing an increase of $794.3 million or 14.0%. On a linked quarter comparison basis, the interest rate spread and
net interest margins decreased to 3.03% and 3.37%, respectively, for the current quarter compared to 3.15% and 3.47%, respectively, for the quarter ended December 31, 2002. However, excluding an annual capital gain dividend from a mutual fund investment of $696 thousand received in the fourth quarter of 2002, the net spread and margin for the fourth quarter would have been 3.11% and 3.43%, respectively.
• During the first quarter of 2003, the volume of loans sold by the Company’s mortgage banking subsidiary, SIB Mortgage Corp., remained strong and amounted to $3.7 billion compared to $3.6 billion in the fourth quarter of 2002 and $1.5 billion in the first quarter of 2002. The Company’s net gain on loan sales amounted to $87.8 million for the quarter ended March 31, 2003 compared to $78.9 million for the quarter ended December 31, 2002. The Company’s net realized gross margins on loans sold decreased slightly to 2.30% for the first quarter of 2003 compared to 2.33% for the fourth quarter of 2002.
• The overall interest rate environment continues to remain favorable to the Company’s mortgage banking segment. SIB Mortgage continued to experience record loan application volume of $6.8 billion for the quarter ended March 31, 2003 compared to $6.2 billion for the quarter ended December 31, 2002. Based upon current application levels, it is anticipated that loan sales will be approximately $4.0 billion in the second quarter of 2003. The Company reported an unrealized gain on derivative transactions of $4.4 million in the first quarter of 2003 due to an increase in the fair market value of locked loan commitments, net of forward sales commitments, of $2.5 million at SIB Mortgage and $1.8 million at the Bank. For the fourth quarter of 2002, the Company reported an unrealized net loss of $426,000 on derivative transactions. The change in unrealized gain/loss on derivative transactions was primarily due to an increase in the amount of locked loan commitments held as of the end of the respective quarters as well as a decline in market rates of interest at the respective measurement dates. While loan origination volume at SIB Mortgage continues to be positively impacted by the current low interest rate environment, volume at SIB Mortgage in the future, particularly with respect to mortgage loan re-financings (which currently constitute approximately 71% of SIB Mortgage originations), as well as the unrealized gain/loss on the SIB Mortgage’s derivative instruments, may be adversely affected by increases in interest rates. The mortgage company continues to look for market expansion opportunities and to review its current operations and product mix to maintain a profitable level of originations in all interest rate environments.
• Deposit growth remained strong in the first quarter of 2003. Total deposits increased $98.6 million or 2.8% (representing 11.4% on an annualized basis) during the three months ended March 31, 2003. Core deposits, which consist of savings, NOW, DDA and money market accounts, increased $114.l million or 4.8% (19.2% on an annualized basis) in the first quarter and now represent 69.4% of total deposits at March 31, 2003. The increase in the retail deposit base continues to be driven by our continuing expansion while maintaining our leading market share in Staten Island. The expansion of the Bank’s retail deposit base, which has increased the volume of fee-related transactions, also contributed to a $678 thousand or 21.0% increase in service and fee income for the quarter ended March 31, 2003 compared to the quarter ended March 31, 2002.
• The Company’s return on average equity increased to 16.53% for the quarter ended March 31, 2003 compared to 16.00% for the quarter ended December 31, 2002. The Company’s tangible book value per share increased to $9.50 at March 31, 2003 compared to $9.23 at December 31, 2002.
2
• The Company continued to manage its capital position through the use of stock repurchases. During the first quarter of 2003, as part of its previously announced ninth share repurchase program, the Company repurchased 655,100 shares at an average price of $15.83 per share. There are approximately 1.7 million shares remaining to be purchased in the current program.
• Total other expenses for the first quarter of 2003 were $119.3 million compared to $106.1 million for the quarter ended December 31, 2002. On a linked quarter basis, total other expenses for the community-banking segment were $22.7 million for the first quarter of 2003, compared to $21.2 million for the fourth quarter of 2002. The increase of $1.5 million was due primarily to an increase in professional fees, consulting fees, advertising costs and data processing costs. Also, on a linked quarter basis, total other expenses for the mortgage-banking segment were $96.6 million (net of inter-company eliminations) for the current quarter compared to $84.9 million for the previous quarter. The increase of $11.7 million was primarily due to an $8.2 million increase in commission expense, a $1.4 million increase in personnel expense, and a $1.5 million increase in other expense. The increases in commission and personnel expense reflect the increased loan origination volumes at SIB Mortgage. The increase in other expenses was primarily the result of $1.3 million in write-downs of the carrying value of certain other real estate owned.
Asset Quality
Overall asset quality continued to be strong at March 31, 2003 as non-accruing assets totaled $27.1 million, representing minimal change compared to total non-accrual assets of $27.0 million at December 31, 2002. Non-accruing assets at March 31, 2003 consisted of $18.7 million in non-accruing loans and $8.4 million of other real estate owned (“OREO”). This compares to $17.3 million in non-accruing loans and $9.7 million of OREO at December 31, 2002. Non-accruing loans at March 31, 2003 consisted of $15.8 million in single-family residential mortgage loans, $0.8 million of commercial real estate loans, $0.3 million of construction and land loans and $1.8 million of other loans. Net loan charge-offs were $766 thousand in the current quarter. The Company has a contract in place to sell one of its OREO properties with a carrying value of $4.2 million at no additional loss. This sale is currently scheduled for the second quarter of 2003. Based upon its quarterly review, management deemed it appropriate to make an $850 thousand provision for loan losses in the first quarter of 2003.
The allowance for loan losses was $22.9 million or 122.3% of total non-accruing loans at March 31, 2003, compared to $22.8 million or 131.2% of non-accruing loans at December 31, 2002 and $21.2 million or 77.7% of non-accruing loans at March 31, 2002.
* * *
“Safe Harbor” Statement under the Private Securities Litigation Reform Act of 1995: Statements in this press release relating to plans, strategies, economic performance and trends, projections of results of specific activities or investments and other statements that are not descriptions of historical facts may be forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking information is inherently subject to risks and uncertainties, and actual results could differ materially from those currently anticipated due to a number of factors, which include, but are not limited to, factors discussed in the Company’s Annual Report on Form 10-K
3
and in other documents filed by the Company with the Securities and Exchange Commission from time to time. Forward-looking statements may be identified by terms such are “may,” “will,” “should,” “could,” “expects,” “plans,” “intends,” “anticipates,” “believes,” “estimates,” “predicts”, “forecasts,” “potential” or “continue” or similar terms or the negative of these terms. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. The Company has no obligation to update these forward-looking statements.
* * *
Staten Island Bancorp, Inc. is the holding company for SI Bank & Trust. SI Bank & Trust was chartered in 1864 and currently operates 17 full service branches and three limited service branches on Staten Island, New York, three full service branches in Brooklyn, New York and 15 full service branches in New Jersey. SI Bank & Trust also operates SIB Mortgage Corp., a wholly owned subsidiary of SI Bank & Trust, which conducts business under the name of Ivy Mortgage in 42 states. On March 31, 2003, Staten Island Bancorp had $6.9 billion in total assets and $625.0 million of total stockholders’ equity.
4
CONSOLIDATED STATEMENTS OF INCOME (unaudited)
|
| For the Three Months Ended March 31, |
| |||||||
|
| 2003 |
| 2002 (Restated) |
| Increase (Decrease) |
| |||
|
| (000’s omitted, except per share and share data) |
| |||||||
|
|
|
|
|
|
|
| |||
Interest Income: |
|
|
|
|
|
|
| |||
Loans |
| $ | 83,854 |
| $ | 69,883 |
| $ | 13,971 |
|
Securities available for sale |
| 12,865 |
| 23,825 |
| (10,960 | ) | |||
Federal funds sold |
| 553 |
| 509 |
| 44 |
| |||
Total interest income |
| 97,272 |
| 94,217 |
| 3,055 |
| |||
|
|
|
|
|
|
|
| |||
Interest Expense: |
|
|
|
|
|
|
| |||
Savings and escrow accounts |
| 3,131 |
| 4,483 |
| (1,352 | ) | |||
Certificates of deposit |
| 7,858 |
| 10,346 |
| (2,488 | ) | |||
Money market and NOW accounts |
| 4,003 |
| 3,357 |
| 646 |
| |||
Borrowed funds |
| 28,473 |
| 28,140 |
| 333 |
| |||
Total interest expense |
| 43,465 |
| 46,326 |
| (2,861 | ) | |||
Net interest income |
| 53,807 |
| 47,891 |
| 5,916 |
| |||
Provision for Loan Losses |
| 850 |
| 1,500 |
| (650 | ) | |||
Net interest income after provision for loan losses |
| 52,957 |
| 46,391 |
| 6,566 |
| |||
|
|
|
|
|
|
|
| |||
Other Income (Loss): |
|
|
|
|
|
|
| |||
Service and fee income |
| 3,900 |
| 3,222 |
| 678 |
| |||
Net gains on loan sales |
| 87,838 |
| 37,130 |
| 50,708 |
| |||
Unrealized gain(loss) on derivative transactions |
| 4,357 |
| (860 | ) | 5,217 |
| |||
Loan fees |
| 11,460 |
| 6,780 |
| 4,680 |
| |||
Other Income |
| 1,899 |
| 1,830 |
| 69 |
| |||
Securities transactions |
| 315 |
| 167 |
| 148 |
| |||
|
| 109,769 |
| 48,269 |
| 61,500 |
| |||
|
|
|
|
|
|
|
| |||
Other Expenses: |
|
|
|
|
|
|
| |||
Personnel |
| 26,067 |
| 39,501 |
| (13,434 | ) | |||
Commissions |
| 62,003 |
| 20,639 |
| 41,364 |
| |||
Occupancy and equipment |
| 5,180 |
| 3,621 |
| 1,559 |
| |||
Amortization of intangible assets |
| 145 |
| 145 |
| — |
| |||
Data processing |
| 1,830 |
| 1,706 |
| 124 |
| |||
Marketing |
| 1,740 |
| 1,110 |
| 630 |
| |||
Professional fees |
| 5,274 |
| 2,660 |
| 2,614 |
| |||
Other |
| 17,047 |
| 8,398 |
| 8,649 |
| |||
Total other expenses |
| 119,286 |
| 77,780 |
| 41,506 |
| |||
Income before provision for income taxes |
| 43,440 |
| 16,880 |
| 26,560 |
| |||
|
|
|
|
|
|
|
| |||
Provision for Income Taxes |
| 17,997 |
| 6,856 |
| 11,141 |
| |||
Net Income |
| $ | 25,443 |
| $ | 10,024 |
| $ | 15,419 |
|
|
|
|
|
|
|
|
| |||
Earnings Per Share: |
|
|
|
|
|
|
| |||
Basic |
| $ | 0.46 |
| $ | 0.18 |
|
|
| |
Fully Diluted |
| $ | 0.45 |
| $ | 0.16 |
|
|
| |
|
|
|
|
|
|
|
| |||
Dividends Declared Per Share |
| $ | 0.13 |
| $ | 0.11 |
|
|
| |
|
|
|
|
|
|
|
| |||
Weighted Average: Fully Diluted |
|
|
|
|
|
|
| |||
Common Shares |
| 90,260,624 |
| 90,260,624 |
|
|
| |||
Less: Unallocated ESOP/RRP Shares |
| 4,968,700 |
| 5,390,001 |
|
|
| |||
Less: Treasury Shares |
| 28,243,146 |
| 25,686,409 |
|
|
| |||
|
| 57,048,778 |
| 59,184,214 |
|
|
| |||
5
CONSOLIDATED STATEMENTS OF CONDITION (unaudited)
|
| March 31, 2003 |
| December 31, 2002 |
| Increase (Decrease) |
| |||
|
|
|
| (000’s omitted) |
|
|
| |||
ASSETS: |
|
|
|
|
|
|
| |||
Cash and due from banks |
| $ | 107,731 |
| $ | 137,085 |
| $ | (29,354 | ) |
Federal funds sold |
| 307,000 |
| 237,000 |
| 70,000 |
| |||
Securities available for sale |
| 1,024,708 |
| 911,432 |
| 113,276 |
| |||
Federal Home Loan Bank of NY capital stock |
| 99,900 |
| 112,150 |
| (12,250 | ) | |||
Loans, net of allowance for loan losses of $22,856 in 2003 and $22,773 in 2002 |
| 3,321,045 |
| 3,422,492 |
| (101,447 | ) | |||
Loans held for sale |
| 1,630,874 |
| 1,729,890 |
| (99,016 | ) | |||
Accrued interest receivable |
| 24,228 |
| 23,976 |
| 252 |
| |||
Bank premises and equipment, net |
| 48,892 |
| 47,545 |
| 1,347 |
| |||
Intangible assets, net |
| 57,347 |
| 57,881 |
| (534 | ) | |||
Other assets |
| 279,890 |
| 255,644 |
| 24,246 |
| |||
Total assets |
| $ | 6,901,615 |
| $ | 6,935,095 |
| $ | (33,480 | ) |
|
|
|
|
|
|
|
| |||
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
|
|
|
|
| |||
|
|
|
|
|
|
|
| |||
LIABILITIES: |
|
|
|
|
|
|
| |||
Due Depositors- |
|
|
|
|
|
|
| |||
Savings |
| $ | 1,089,014 |
| $ | 1,045,767 |
| $ | 43,247 |
|
Certificates of deposit |
| 1,089,850 |
| 1,105,370 |
| (15,520 | ) | |||
Money market |
| 690,955 |
| 639,037 |
| 51,918 |
| |||
NOW accounts |
| 142,586 |
| 134,450 |
| 8,136 |
| |||
Demand deposits |
| 550,322 |
| 539,510 |
| 10,812 |
| |||
Total deposits |
| 3,562,727 |
| 3,464,134 |
| 98,593 |
| |||
Borrowed funds |
| 2,506,920 |
| 2,756,927 |
| (250,007 | ) | |||
Advances from borrowers for taxes and insurance |
| 25,729 |
| 23,537 |
| 2,192 |
| |||
Accrued interest and other liabilities |
| 181,274 |
| 76,229 |
| 105,045 |
| |||
Total liabilities |
| 6,276,650 |
| 6,320,827 |
| (44,177 | ) | |||
|
|
|
|
|
|
|
| |||
STOCKHOLDERS’ EQUITY: |
|
|
|
|
|
|
| |||
Common stock, par value $.01 per share, 100,000,000 shares authorized, 90,260,624 issued and 59,752,432 outstanding at March 31, 2003 and 90,260,624 issued and 60,269,397 outstanding at December 31, 2002 |
| 903 |
| 903 |
| — |
| |||
Additional paid-in-capital |
| 587,720 |
| 586,405 |
| 1,315 |
| |||
Retained earnings |
| 409,932 |
| 391,739 |
| 18,193 |
| |||
Unallocated common stock held by ESOP |
| (26,782 | ) | (27,468 | ) | 686 |
| |||
Unearned common stock held by RRP |
| (8,784 | ) | (8,894 | ) | 110 |
| |||
Treasury stock (30,508,192 shares at March 31, 2003 and 29,991,227 at December 31, 2002), at cost |
| (348,789 | ) | (339,982 | ) | (8,807 | ) | |||
|
| 614,200 |
| 602,703 |
| 11,497 |
| |||
Accumulated other comprehensive income, net of taxes |
| 10,765 |
| 11,565 |
| (800 | ) | |||
Total stockholders’ equity |
| 624,965 |
| 614,268 |
| 10,697 |
| |||
Total liabilities and stockholders’ equity |
| $ | 6,901,615 |
| $ | 6,935,095 |
| $ | (33,480 | ) |
6
SELECTED DATA (unaudited)
|
| At or For the Three Months |
| ||||
|
| 2003 |
| 2002 (Restated) |
| ||
|
|
|
|
|
| ||
Earnings per share/Tangible book value per share |
|
|
|
|
| ||
Earnings per share - Fully diluted |
| $ | 0.45 |
| $ | 0.16 |
|
Tangible book value per share |
| $ | 9.50 |
| $ | 8.22 |
|
|
|
|
|
|
| ||
Performance Ratios: (1) |
|
|
|
|
| ||
Return on average assets |
| 1.46 | % | 0.66 | % | ||
Return on average equity |
| 16.53 | % | 7.18 | % | ||
|
|
|
|
|
| ||
Average interest-earning assets to average interest-bearing liabilities |
| 112.35 | % | 113.76 | % | ||
Interest rate spread |
| 3.03 | % | 2.96 | % | ||
Net interest margin |
| 3.37 | % | 3.42 | % | ||
Noninterest expenses, exclusive of amortization of intangible assets, to average assets |
| 6.83 | % | 5.15 | % | ||
Efficiency ratio |
| 72.96 | % | 80.80 | % | ||
|
|
|
|
|
| ||
Capital Ratios: |
|
|
|
|
| ||
Average equity to average assets |
| 8.82 | % | 9.25 | % | ||
Tangible equity to assets at end of period |
| 8.14 | % | 8.20 | % | ||
Total capital to risk-weighted assets |
| 15.44 | % | 14.99 | % | ||
|
|
|
|
|
| ||
Asset Quality: |
|
|
|
|
| ||
Non-accruing loans and real estate owned to total assets at end of the period |
| 0.39 | % | 0.47 | % | ||
Allowance for loan losses to non-accruing loans at end of period |
| 122.29 | % | 77.69 | % | ||
Allowance for loan losses to total loans at end of period |
| 0.46 | % | 0.53 | % | ||
Non-accruing loans |
| $ | 18,690 |
| $ | 27,248 |
|
Non-accruing loans and real estate owned |
| $ | 27,051 |
| $ | 28,965 |
|
Allowance for loan losses |
| $ | 22,856 |
| $ | 21,168 |
|
(1) All ratios are annualized where appropriate.
7
CONSOLIDATED STATEMENTS OF INCOME (unaudited)
|
| QUARTER ENDED |
| |||||||||||||
|
| March 31, |
| December 31, |
| September 30, |
| June 30, |
| March 31, |
| |||||
|
| (000’s omitted, except per share and share data) |
| |||||||||||||
|
|
|
|
|
|
|
| (Restated) |
| (Restated) |
| |||||
Interest Income: |
|
|
|
|
|
|
|
|
|
|
| |||||
Loans |
| $ | 83,854 |
| $ | 86,445 |
| $ | 79,552 |
| $ | 75,755 |
| $ | 69,883 |
|
Securities, available for sale |
| 12,865 |
| 15,457 |
| 20,761 |
| 24,016 |
| 23,825 |
| |||||
Federal funds sold |
| 553 |
| 418 |
| 322 |
| 189 |
| 509 |
| |||||
Total interest income |
| 97,272 |
| 102,320 |
| 100,635 |
| 99,960 |
| 94,217 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Interest Expense: |
|
|
|
|
|
|
|
|
|
|
| |||||
Savings and escrow accounts |
| 3,131 |
| 3,751 |
| 4,285 |
| 4,918 |
| 4,483 |
| |||||
Certificates of deposit |
| 7,858 |
| 9,014 |
| 9,837 |
| 9,811 |
| 10,346 |
| |||||
Money market and NOW accounts |
| 4,003 |
| 4,515 |
| 4,423 |
| 3,985 |
| 3,357 |
| |||||
Borrowed funds |
| 28,473 |
| 29,549 |
| 29,821 |
| 28,379 |
| 28,140 |
| |||||
Total interest expense |
| 43,465 |
| 46,829 |
| 48,366 |
| 47,093 |
| 46,326 |
| |||||
Net interest income |
| 53,807 |
| 55,491 |
| 52,269 |
| 52,867 |
| 47,891 |
| |||||
Provision for Loan Losses |
| 850 |
| (985 | ) | 3,349 |
| 4,990 |
| 1,500 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Net interest income after provision for loan losses |
| 52,957 |
| 56,476 |
| 48,920 |
| 47,877 |
| 46,391 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Other Income (Loss): |
|
|
|
|
|
|
|
|
|
|
| |||||
Service and fee income |
| 3,900 |
| 3,955 |
| 3,948 |
| 3,649 |
| 3,222 |
| |||||
Net gains on loan sales |
| 87,838 |
| 78,923 |
| 55,293 |
| 35,054 |
| 37,130 |
| |||||
Unrealized gain (loss) on derivative transactions |
| 4,357 |
| (426 | ) | 14,033 |
| (160 | ) | (860 | ) | |||||
Loan fees |
| 11,460 |
| 10,092 |
| 7,252 |
| 5,063 |
| 6,780 |
| |||||
Other Income |
| 1,899 |
| 1,928 |
| 1,917 |
| 4,879 |
| 1,830 |
| |||||
Securities transactions |
| 315 |
| (2,506 | ) | 1,512 |
| 432 |
| 167 |
| |||||
|
| 109,769 |
| 91,966 |
| 83,955 |
| 48,917 |
| 48,269 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Other Expenses: |
|
|
|
|
|
|
|
|
|
|
| |||||
Personnel |
| 26,067 |
| 25,126 |
| 9,905 |
| 21,728 |
| 39,501 |
| |||||
Commissions |
| 62,003 |
| 53,848 |
| 33,735 |
| 21,105 |
| 20,639 |
| |||||
Occupancy and equipment |
| 5,180 |
| 4,942 |
| 4,085 |
| 3,814 |
| 3,621 |
| |||||
Amortization of intangible assets |
| 145 |
| 145 |
| 138 |
| 153 |
| 145 |
| |||||
FDIC Insurance |
| 145 |
| 136 |
| 131 |
| 125 |
| 120 |
| |||||
Data processing |
| 1,830 |
| 1,674 |
| 1,643 |
| 1,667 |
| 1,706 |
| |||||
Marketing |
| 1,740 |
| 1,683 |
| 1,322 |
| 1,382 |
| 1,110 |
| |||||
Professional fees |
| 5,274 |
| 3,823 |
| 2,978 |
| 3,059 |
| 2,660 |
| |||||
Other |
| 16,902 |
| 14,740 |
| 10,232 |
| 9,249 |
| 8,278 |
| |||||
Total other expenses |
| 119,286 |
| 106,117 |
| 64,169 |
| 62,282 |
| 77,780 |
| |||||
Income before provision for income taxes |
| 43,440 |
| 42,325 |
| 68,706 |
| 34,512 |
| 16,880 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Provision for Income Taxes |
| 17,997 |
| 17,763 |
| 28,230 |
| 13,927 |
| 6,856 |
| |||||
Income before cumulative effect of accounting change |
| 25,443 |
| 24,562 |
| 40,476 |
| 20,585 |
| 10,024 |
| |||||
Cumulative effect of change in accounting principle, net of tax |
| — |
| — |
| 4,731 |
| — |
| — |
| |||||
Net Income |
| $ | 25,443 |
| $ | 24,562 |
| $ | 45,207 |
| $ | 20,585 |
| $ | 10,024 |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
Earnings Per Share: |
|
|
|
|
|
|
|
|
|
|
| |||||
Basic |
| $ | 0.46 |
| $ | 0.45 |
| $ | 0.81 |
| $ | 0.36 |
| $ | 0.18 |
|
Fully Diluted |
| $ | 0.45 |
| $ | 0.43 |
| $ | 0.78 |
| $ | 0.35 |
| $ | 0.16 |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
Dividends Declared Per Share |
| $ | 0.13 |
| $ | 0.13 |
| $ | 0.13 |
| $ | 0.12 |
| $ | 0.11 |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
Stock Closing Price |
| 14.920 |
| 20.140 |
| 17.400 |
| 19.200 |
| 19.680 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Weighted Average - Fully Diluted Shares |
|
|
|
|
|
|
|
|
|
|
| |||||
Common Shares |
| 90,260,624 |
| 90,260,624 |
| 90,260,624 |
| 90,260,624 |
| 90,260,624 |
| |||||
Less: Unallocated ESOP/RRP Shares |
| 4,968,700 |
| 5,073,993 |
| 5,181,972 |
| 5,296,410 |
| 5,390,001 |
| |||||
Less: Treasury Shares |
| 28,243,146 |
| 27,721,717 |
| 27,504,031 |
| 26,105,952 |
| 25,686,409 |
| |||||
|
| 57,048,778 |
| 57,464,914 |
| 57,574,621 |
| 58,858,262 |
| 59,184,214 |
| |||||
8
Segment Reporting Table
For The Three Months Ended March 31, 2003 and 2002
|
| Quarter Ended |
| ||||||||||
|
| Mortgage Banking |
| Community |
| Elimination of |
| Total |
| ||||
Interest income |
| $ | 30,196 |
| $ | 82,387 |
| $ | (15,311 | ) | $ | 97,272 |
|
Interest expense |
| 17,885 |
| 40,891 |
| (15,311 | ) | 43,465 |
| ||||
Net Interest income |
| 12,311 |
| 41,496 |
| — |
| 53,807 |
| ||||
Provision for loan losses |
| — |
| 850 |
| — |
| 850 |
| ||||
Other income (loss): |
|
|
|
|
|
|
|
|
| ||||
Service and fee income |
| — |
| 6,605 |
| (2,705 | ) | 3,900 |
| ||||
Net gains (losses) on loan sales |
| 88,300 |
| 27 |
| (489 | ) | 87,838 |
| ||||
Unrealized gain on derivative transactions |
| 2,532 |
| 1,825 |
| — |
| 4,357 |
| ||||
Loan fees |
| 11,433 |
| 27 |
| — |
| 11,460 |
| ||||
Other income |
| — |
| 1,899 |
| — |
| 1,899 |
| ||||
Securities transactions |
| — |
| 315 |
| — |
| 315 |
| ||||
Total other income (loss) |
| 102,265 |
| 10,698 |
| (3,194 | ) | 109,769 |
| ||||
Other expenses |
| 99,261 |
| 22,730 |
| (2,705 | ) | 119,286 |
| ||||
Income before provision for income taxes |
| 15,315 |
| 28,614 |
| (489 | ) | 43,440 |
| ||||
Provision for income taxes |
| 6,278 |
| 11,900 |
| (181 | ) | 17,997 |
| ||||
Net income |
| $ | 9,037 |
| $ | 16,714 |
| $ | (308 | ) | $ | 25,443 |
|
|
| Quarter Ended |
| ||||||||||
|
| Mortgage Banking |
| Community |
| Elimination of |
| Total |
| ||||
Interest income |
| $ | 22,315 |
| $ | 86,363 |
| $ | (14,461 | ) | $ | 94,217 |
|
Interest expense |
| 15,102 |
| 45,685 |
| (14,461 | ) | 46,326 |
| ||||
Net Interest income |
| 7,213 |
| 40,678 |
| — |
| 47,891 |
| ||||
Provision for loan losses |
| 700 |
| 800 |
| — |
| 1,500 |
| ||||
Other income (loss): |
|
|
|
|
|
|
|
|
| ||||
Service and fee income |
| — |
| 3,222 |
| — |
| 3,222 |
| ||||
Net gains (losses) on loan sales |
| 41,880 |
| 126 |
| (4,876 | ) | 37,130 |
| ||||
Unrealized gain (loss) on derivative transactions |
| (860 | ) | — |
|
|
| (860 | ) | ||||
Loan fees |
| 6,015 |
| 765 |
| — |
| 6,780 |
| ||||
Other income |
| — |
| 1,830 |
|
|
| 1,830 |
| ||||
Securities transactions |
| — |
| 167 |
| — |
| 167 |
| ||||
Total other income (loss) |
| 47,035 |
| 6,110 |
| (4,876 | ) | 48,269 |
| ||||
Other expenses |
| 38,909 |
| 38,871 |
| — |
| 77,780 |
| ||||
Income before provision for income taxes |
| 14,639 |
| 7,117 |
| (4,876 | ) | 16,880 |
| ||||
Provision for income taxes |
| 6,075 |
| 2,585 |
| (1,804 | ) | 6,856 |
| ||||
Net income |
| $ | 8,564 |
| $ | 4,532 |
| $ | (3,072 | ) | $ | 10,024 |
|
9
The Mortgage Company sells various types of loans in the secondary market.
The following table summarizes loans sold and gross margins realized by the types of loan.
The table does not reflect the unrealized gains or losses on derivative transactions (SFAS #133), nor the effect of the recognition of deferred loan costs or fees in accordance with SFAS #91.
|
| Quarter Ended March 31, 2003 |
| ||||||
Type |
| Volume |
| Net Realized |
| Net Realized |
| ||
|
|
|
|
|
|
|
| ||
Agency Eligible |
| $ | 2,360,063,396 |
| $ | 50,311,820 |
| 2.13 | % |
Government |
| 347,567,863 |
| 11,835,158 |
| 3.41 | % | ||
Jumbo |
| 151,911,337 |
| 2,150,712 |
| 1.42 | % | ||
Alt-A |
| 731,064,605 |
| 17,339,661 |
| 2.37 | % | ||
Sub Prime |
| 137,505,222 |
| 4,202,226 |
| 3.06 | % | ||
|
|
|
|
|
|
|
| ||
Total |
| $ | 3,728,112,423 |
| $ | 85,839,577 |
| 2.30 | % |
|
| Quarter Ended December 31, 2002 |
| ||||||
Type |
| Volume |
| Net Realized |
| Net Realized |
| ||
|
|
|
|
|
|
|
| ||
Agency Eligible |
| $ | 1,852,958,968 |
| $ | 41,382,562 |
| 2.23 | % |
Government |
| 584,203,613 |
| 15,606,522 |
| 2.67 | % | ||
Jumbo |
| 324,581,505 |
| 4,869,021 |
| 1.50 | % | ||
Alt-A |
| 737,708,054 |
| 18,837,475 |
| 2.55 | % | ||
Sub Prime |
| 90,773,971 |
| 2,826,324 |
| 3.11 | % | ||
|
|
|
|
|
|
|
| ||
Total |
| $ | 3,590,226,111 |
| $ | 83,521,905 |
| 2.33 | % |
10
AVERAGE BALANCES, NET INTEREST INCOME, YIELDS EARNED AND RATES PAID (unaudited)
|
| Three Months Ended March 31, |
| ||||||||||||||
|
| 2003 |
| 2002 (Restated) |
| ||||||||||||
|
| Average |
| Interest |
| Average |
| Average |
| Interest |
| Average |
| ||||
|
| (000’s omitted) |
| ||||||||||||||
Interest-earning assets: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Loans receivable (1): |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Real estate loans |
| $ | 5,156,099 |
| $ | 81,865 |
| 6.44 | % | $ | 3,857,163 |
| $ | 67,652 |
| 7.11 | % |
Other loans |
| 106,449 |
| 1,989 |
| 7.58 | % | 106,137 |
| 2,231 |
| 8.52 | % | ||||
Total loans |
| 5,262,548 |
| 83,854 |
| 6.46 | % | 3,963,300 |
| 69,883 |
| 7.15 | % | ||||
Securities |
| 1,011,951 |
| 12,865 |
| 5.16 | % | 1,584,271 |
| 23,825 |
| 6.10 | % | ||||
Other interest-earning assets (2) |
| 198,826 |
| 553 |
| 1.13 | % | 131,419 |
| 509 |
| 1.57 | % | ||||
Total interest-earning assets |
| 6,473,325 |
| 97,272 |
| 6.09 | % | 5,678,990 |
| 94,217 |
| 6.73 | % | ||||
Noninterest-earning assets |
| 602,837 |
|
|
|
|
| 439,586 |
|
|
|
|
| ||||
Total assets |
| $ | 7,076,162 |
|
|
|
|
| $ | 6,118,576 |
|
|
|
|
| ||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Interest-bearing liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Deposits: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
NOW and money market deposits |
| $ | 806,018 |
| 4,003 |
| 2.01 | % | $ | 520,441 |
| 3,357 |
| 2.62 | % | ||
Savings and escrow accounts |
| 1,088,050 |
| 3,131 |
| 1.17 | % | 915,964 |
| 4,483 |
| 1.98 | % | ||||
Certificates of deposit |
| 1,088,885 |
| 7,858 |
| 2.93 | % | 1,079,803 |
| 10,346 |
| 3.89 | % | ||||
Total deposits |
| 2,982,953 |
| 14,992 |
| 2.04 | % | 2,516,208 |
| 18,186 |
| 2.93 | % | ||||
Total Other Borrowings |
| 2,778,918 |
| 28,473 |
| 4.16 | % | 2,475,947 |
| 28,140 |
| 4.61 | % | ||||
Total interest-bearing liabilities |
| 5,761,871 |
| 43,465 |
| 3.06 | % | 4,992,155 |
| 46,326 |
| 3.76 | % | ||||
Noninterest-bearing liabilities (3) |
| 690,133 |
|
|
|
|
| 560,400 |
|
|
|
|
| ||||
Total liabilities |
| 6,452,004 |
|
|
|
|
| 5,552,555 |
|
|
|
|
| ||||
Stockholders’ equity |
| 624,158 |
|
|
|
|
| 566,021 |
|
|
|
|
| ||||
Total liabilities and stockholders’ equity |
| $ | 7,076,162 |
|
|
|
|
| $ | 6,118,576 |
|
|
|
|
| ||
Net interest-earning assets |
| $ | 711,454 |
|
|
|
|
| $ | 686,835 |
|
|
|
|
| ||
Net interest income/interest rate spread |
|
|
| $ | 53,807 |
| 3.03 | % |
|
| $ | 47,891 |
| 2.96 | % | ||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Net interest margin |
|
|
|
|
| 3.37 | % |
|
|
|
| 3.42 | % | ||||
Ratio of average interest-earning assets to average interest-bearing liabilities |
|
|
|
|
| 112.35 | % |
|
|
|
| 113.76 | % | ||||
(1) The average balance of loans receivable includes nonperforming loans, interest on which is recognized on a cash basis.
(2) Includes money market accounts and Federal Funds sold.
(3) Consists primarily of demand deposit accounts.
11
LOAN PORTFOLIO COMPOSITION - The following table sets forth the composition of the Company at the dates indicated.
|
| March 31, 2003 |
| December 31, 2002 |
| Increase (Decrease) |
| |||
|
| (000’s omitted) |
| |||||||
|
| (unaudited) |
| |||||||
Mortgage loans: (1) |
|
|
|
|
|
|
| |||
Single-family residential |
| $ | 2,541,066 |
| $ | 2,671,041 |
| $ | (129,975 | ) |
Multi-family residential |
| 58,334 |
| 56,545 |
| 1,789 |
| |||
Commercial real estate |
| 444,459 |
| 418,708 |
| 25,751 |
| |||
Construction and land |
| 160,978 |
| 153,144 |
| 7,834 |
| |||
Home equity |
| 19,981 |
| 19,032 |
| 949 |
| |||
Total mortgage loans |
| 3,224,818 |
| 3,318,470 |
| (93,652 | ) | |||
|
|
|
|
|
|
|
| |||
Other loans: |
|
|
|
|
|
|
| |||
Student loans |
| 328 |
| 228 |
| 100 |
| |||
Passbook loans |
| 8,778 |
| 8,692 |
| 86 |
| |||
Commercial business loans |
| 57,574 |
| 62,777 |
| (5,203 | ) | |||
Other consumer loans |
| 34,631 |
| 37,362 |
| (2,731 | ) | |||
Total other loans |
| 101,311 |
| 109,059 |
| (7,748 | ) | |||
|
|
|
|
|
|
|
| |||
Total loans receivable |
| 3,326,129 |
| 3,427,529 |
| (101,400 | ) | |||
Less: |
|
|
|
|
|
|
| |||
Premium on loans purchased |
| 3,775 |
| 3,941 |
| (166 | ) | |||
Allowance for loan losses |
| (22,856 | ) | (22,773 | ) | (83 | ) | |||
Deferred loan costs |
| 13,997 |
| 13,795 |
| 202 |
| |||
Loans receivable, net |
| $ | 3,321,045 |
| $ | 3,422,492 |
| $ | (101,447 | ) |
(1) Mortgage loans held for sale at March 31, 2003 and December 31, 2002, of $1.6 billion and $1.8 billion, respectively, are not included in this table.
12
LOANS PAST DUE 90 DAYS OR MORE STILL ACCRUING AND NON-ACCRUING ASSETS. The following tables set forth information with respect to non-accruing loans, other real estate owned, repossessed assets and loans past due 90 days or more and still accruing.
|
| March 31, 2003 |
| December 31, 2002 |
| ||
|
| (000’s omitted) |
| ||||
|
| (unaudited) |
| ||||
Non-Accruing Loan Assets |
|
|
|
|
| ||
Mortgage loans: |
|
|
|
|
| ||
Single-family residential |
| $ | 15,804 |
| $ | 11,942 |
|
Multi-family residential |
| — |
| — |
| ||
Commercial real estate |
| 749 |
| 2,687 |
| ||
Construction and land |
| 323 |
| 1,094 |
| ||
Home equity |
| — |
| — |
| ||
Other loans: |
|
|
|
|
| ||
Commercial business loans |
| 948 |
| 797 |
| ||
Other consumer loans |
| 866 |
| 837 |
| ||
|
|
|
|
|
| ||
Total non-accrual loans |
| 18,690 |
| 17,357 |
| ||
Other real estate owned and repossessed assets, net |
| 8,361 |
| 9,681 |
| ||
Total non-accruing loan assets |
| 27,051 |
| 27,038 |
| ||
|
|
|
|
|
| ||
Loans past due 90 days or more and still accruing |
| 4,555 |
| 5,684 |
| ||
Non-accruing loan assets and loans past due 90 days or more and still accruing |
| $ | 31,606 |
| $ | 32,722 |
|
|
|
|
|
|
| ||
Non-accruing loan assets to total *HFI & **HFS loans |
| 0.55 | % | 0.53 | % | ||
Non-accruing loan assets to total assets |
| 0.39 | % | 0.39 | % | ||
Non-accruing loans to total *HFI & **HFS loans |
| 0.38 | % | 0.34 | % | ||
Non-accruing loans to total assets |
| 0.27 | % | 0.25 | % | ||
* Held for Investment
** Held for Sale
13
DELINQUENT LOANS: The following table sets forth information concerning delinquent loans at the dates indicated. The amounts presented represent the total outstanding principal balances of the related loans held in portfolio and held fo sale loans, rather than the actual payment amounts which are past due.
|
| March 31, 2003 |
| December 31, 2002 |
| ||
|
| (000’s omitted) |
| ||||
|
| (unaudited) |
| ||||
90 Days or More |
|
|
|
|
| ||
Mortgage loans: |
|
|
|
|
| ||
Single-family residential |
| $ | 3,801 |
| $ | 4,451 |
|
Multi-family residential |
| — |
| — |
| ||
Commercial real estate |
| — |
| — |
| ||
Construction and land |
| 257 |
| 940 |
| ||
Home equity |
| — |
| — |
| ||
Total mortgage loans |
| 4,058 |
| 5,391 |
| ||
|
|
|
|
|
| ||
Other loans: |
|
|
|
|
| ||
Commercial business loans |
| 144 |
| 41 |
| ||
Other loans |
| 353 |
| 252 |
| ||
Total other loans |
| 497 |
| 293 |
| ||
|
|
|
|
|
| ||
Total |
| $ | 4,555 |
| $ | 5,684 |
|
|
| March 31, 2003 |
| December 31, 2002 |
| ||
60-89 Days |
|
|
|
|
| ||
Mortgage loans: |
|
|
|
|
| ||
Single-family residential |
| $ | 3,327 |
| $ | 6,699 |
|
Multi-family residential |
| — |
| — |
| ||
Commercial real estate |
| 307 |
| 493 |
| ||
Construction and land |
| 296 |
| 465 |
| ||
Home equity |
| — |
| 8 |
| ||
Total mortgage loans |
| 3,930 |
| 7,665 |
| ||
|
|
|
|
|
| ||
Other loans: |
|
|
|
|
| ||
Commercial business loans |
| 447 |
| 124 |
| ||
Other loans |
| 489 |
| 418 |
| ||
Total other loans |
| 936 |
| 542 |
| ||
|
|
|
|
|
| ||
Total |
| $ | 4,866 |
| $ | 8,207 |
|
|
| March 31, 2003 |
| December 31, 2002 |
| ||
30-59 Days |
|
|
|
|
| ||
Mortgage loans: |
|
|
|
|
| ||
Single-family residential |
| $ | 10,364 |
| $ | 16,496 |
|
Multi-family residential |
| 252 |
| — |
| ||
Commercial real estate |
| 6,052 |
| 3,646 |
| ||
Construction and land |
| 2,223 |
| 2,787 |
| ||
Home equity |
| 300 |
| 51 |
| ||
Total mortgage loans |
| 19,191 |
| 22,980 |
| ||
|
|
|
|
|
| ||
Other loans: |
|
|
|
|
| ||
Commercial business loans |
| 1,095 |
| 3,014 |
| ||
Other loans |
| 1,526 |
| 1,523 |
| ||
Total other loans |
| 2,621 |
| 4,537 |
| ||
|
|
|
|
|
| ||
Total |
| $ | 21,812 |
| $ | 27,517 |
|
14
