Exhibit 99.1
| PRESS RELEASE | For more information contact: | |
| Prosperity Bancshares, Inc.® | Dan Rollins | |
| Prosperity Bank Plaza | President and Chief Operating Officer | |
| 4295 San Felipe | 281.269.7199 | |
| Houston, Texas 77027 | dan.rollins@prosperitybanktx.com | |
FOR IMMEDIATE RELEASE
PROSPERITY BANCSHARES, INC.®
REPORTS RECORD
2008 OPERATING EARNINGS
| • | 4Q 2008 Earnings Per Share of $0.49 (diluted) |
| • | Non-Performing Assets equal 0.20% of 4Q Average Earning Assets |
| • | Total Risk Based Capital is 11.24% |
| • | Tier 1 Leverage Capital is 5.66% |
HOUSTON, January 27, 2009. Prosperity Bancshares, Inc.® NASDAQ: (PRSP), the parent company of Prosperity Bank®, reported net income for the quarter ended December 31, 2008 of $22.685 million or $0.49 per diluted common share, an increase in net income of $5.604 million or 32.8%, compared with $17.081 million or $0.38 per diluted common share for the same period in 2007. Prosperity also reported record net earnings for 2008 of $84.507 million or $1.86 per diluted common share, up 0.42% from 2007 net earnings of $84.151 million and down 4.1% from 2007 diluted earnings per common share of $1.94.
Excluding impairment charges on Prosperity’s Fannie Mae and Freddie Mac perpetual preferred securities of $9.975 million pre-tax during the fourth quarter of 2007 and $14.025 million pre-tax during the third quarter of 2008, net income for the year ended December 31, 2008 would have been $93.623 million or $2.06 per diluted common share compared with $90.635 million or $2.09 per diluted common share for the year ended December 31, 2007.
On November 7, 2008, Prosperity Bank® assumed approximately $3.6 billion of deposits, including all uninsured deposits, from the Federal Deposit Insurance Corporation (FDIC), acting in its capacity as receiver for Franklin Bank, SSB, Houston, Texas. Approximately $2.0 billion of the $3.6 billion in deposits that were assumed by Prosperity were associated with Franklin Bank’s 45 full service banking centers in Texas.
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Since January 1, 2007, in addition to the Franklin Bank transaction listed above, Prosperity has completed the following acquisitions: 1st Choice Bancorp, Inc. on June 1, 2008; the Houston branches of Banco Popular North America on January 10, 2008; The Bank of Navasota, N.A. on September 1, 2007; and Texas United Bancshares, Inc. on January 31, 2007. The results of operations for these acquisitions have been included in Prosperity’s consolidated financial statements since their respective purchase dates.
“It is a pleasure to report another year of earnings for our company. Our performance during this difficult economic environment continues to be strong,” said David Zalman, Prosperity’s Chairman and Chief Executive Officer. “With a challenging U.S. economy and industry wide credit problems, we are pleased to be able to report stable, consistent earnings and strong credit quality.”
Results of operations for the three months ended December 31, 2008
For the three months ended December 31, 2008, net income was $22.685 million compared with $17.081 million for the same period in 2007. Net income per diluted common share was $0.49 for the three months ended December 31, 2008 and $0.38 for the same period in 2007. Returns on average assets, average common equity and average tangible common equity for the three months ended December 31, 2008 were 1.09%, 7.30% and 24.89%, respectively. Prosperity’s efficiency ratio (excluding net gains and losses on the sale of securities and assets and impairment charge on write-down of securities) was 48.60% for the three months ended December 31, 2008.
Net interest income before provision for credit losses for the quarter ended December 31, 2008 increased 23.9% to $63.957 million compared with $51.634 million during the same period in 2007. The increase was attributable primarily to a 39.6% increase in average earning assets. The net interest margin on a tax equivalent basis decreased to 3.65% for the three months ended December 31, 2008 compared with 4.12% for the same period in 2007, primarily impacted by the Franklin Bank transaction.
Non-interest income increased $260,000 or 2.0% to $13.508 million for the three months ended December 31, 2008 compared with $13.248 million for the same period in 2007. The increase was mainly attributable to an increase in service charges on deposit accounts related to accounts assumed from the FDIC as part of the Franklin Bank transaction and deposit accounts assumed from the 1st Choice and Banco Popular acquisitions, which was partially offset by an increase in losses on the sale of ORE.
Non-interest expense decreased $1.827 million or 4.6% to $37.586 million for the fourth quarter of 2008 compared with $39.413 million for the fourth quarter of 2007. Excluding the $9.975 million pre-tax impairment charge on Fannie Mae and Freddie Mac perpetual preferred securities in the fourth quarter of 2007, non-interest expense increased $8.148 million or 27.7% compared with the same period in 2007 which was mainly attributable to the increased expenses related to operating the additional banking offices that were previously locations of Franklin Bank.
Loans at December 31, 2008 were $3.567 billion, an increase of $424.086 million or 13.5%, compared with $3.143 billion at December 31, 2007. Loans increased 9.8% or $318.440 million on a linked quarter basis compared with loans of $3.249 billion at September 30, 2008. As reflected in the table below, linked quarter loans for the fourth quarter of 2008 were impacted by the loans acquired from the FDIC as a part of the Franklin Bank transaction and the loans acquired as a part of the acquisitions of The Bank of Navasota, Banco Popular’s Houston branches and 1st Choice.
Deposits at December 31, 2008 were $7.320 billion, an increase of $2.353 billion or 47.4%, compared with $4.966 billion at December 31, 2007. Linked quarter deposits increased $2.215 billion or 43.4% from $5.105 billion at September 30, 2008. As reflected in the table below, linked quarter deposits for the fourth quarter of 2008 were impacted by the deposits assumed from the FDIC as part of the Franklin Bank transaction and the deposits assumed as a part of the acquisitions of The Bank of Navasota, Banco Popular’s Houston branches and 1st Choice.
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Balance Sheet Data (at period end)
(In Thousands)
| Dec 31, 2008 | Sept 30, 2008 | Dec 31, 2007 | |||||||
| (Unaudited) | (Unaudited) | (Unaudited) | |||||||
Loans: | |||||||||
Acquired with The Bank of Navasota | $ | 19,152 | $ | 19,980 | $ | 27,641 | |||
Acquired with Banco Popular’s Houston branches | 3,161 | 2,637 | 0 | ||||||
Acquired with 1stChoice | 168,642 | 182,780 | 0 | ||||||
Acquired from FDIC (related to Franklin Bank) | 356,420 | 0 | 0 | ||||||
All other | 3,019,682 | 3,043,220 | 3,115,330 | ||||||
Total Loans | $ | 3,567,057 | $ | 3,248,617 | $ | 3,142,971 | |||
Deposits: | |||||||||
Assumed with The Bank of Navasota | $ | 51,190 | $ | 55,138 | $ | 61,447 | |||
Assumed with Banco Popular’s Houston branches | 114,434 | 118,490 | 0 | ||||||
Assumed with 1stChoice Bank | 249,287 | 262,465 | 0 | ||||||
Assumed from FDIC (related to Franklin Bank) | 2,010,193 | 0 | 0 | ||||||
All other | 4,894,523 | 4,668,749 | 4,904,960 | ||||||
Total Deposits | $ | 7,319,627 | $ | 5,104,842 | $ | 4,966,407 | |||
Average loans increased 7.3% or $229.037 million to $3.366 billion for the quarter ended December 31, 2008 compared with $3.137 billion for the same period of 2007. Linked quarter average loans increased 2.3% or $76.349 million from $3.289 billion at September 30, 2008. Average deposits increased 39.7% to $6.686 billion for the quarter ended December 31, 2008 compared with $4.785 billion for the same period of 2007. Linked quarter average deposits increased 28.9% or $1.498 billion from $5.187 billion at September 30, 2008.
At December 31, 2008, construction loans totaled $666.080 million (including $52.256 million acquired from the FDIC as part of the Franklin Bank transaction), consisting of approximately $237 million of single family residential construction loans; $91 million of land development loans; $89 million of raw land loans; $107 million of residential lot loans; $39 million of commercial lot loans; and $103 million of commercial construction and other construction loans. This is an increase of $39.637 million from construction loans at September 30, 2008.
Non-performing assets totaled $14.368 million or 0.20% of average earning assets at December 31, 2008 compared with $15.390 million or 0.30% of average earning assets at December 31, 2007 and $14.536 million or 0.26% of average earnings assets at September 30, 2008. The allowance for credit losses was 1.04% of total loans at December 31, 2008 and 2007 and 1.05% of total loans at September 30, 2008.
The provision for credit losses was $6.000 million for the three months ended December 31, 2008 and $120,000 for the three months ended December 31, 2007. Prosperity’s loan loss reserve model called for increased provisioning in the fourth quarter due to increased loans as a result of the Franklin Bank transaction and a general weakening of the economy. Net charge offs were $3.011 million for the three months ended December 31, 2008 and $3.113 million for the three months ended December 31, 2007.
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At December 31, 2008, Prosperity had $9.074 billion in total assets, $3.567 billion in loans, and $7.320 billion in deposits. Assets, loans and deposits at December 31, 2008 grew by 42.4%, 13.5% and 47.4%, respectively, compared with their level at December 31, 2007.
Results of operations excluding impairment charges on Fannie Mae and Freddie Mac perpetual preferred securities
Prosperity incurred a non-cash impairment charge on its Fannie Mae and Freddie Mac perpetual preferred securities in the amount of $14.025 million pre-tax ($9.116 million after-tax) in the third quarter of 2008 equal to the full carrying cost of its investment in such securities. Prosperity also incurred an impairment charge on the same securities of $9.975 million pre-tax ($6.484 million after-tax) in the fourth quarter of 2007. The table below presents select financial results before and after the impairment write-down for the related periods.
| As reported Dec 31, 2008 | As reported (with charge) Dec 31, 2007 | Without charge Dec 31, 2007 | ||||||||||
| (Unaudited) | (Unaudited) | (Unaudited) | ||||||||||
| 3 Months Ended | ||||||||||||
Non-interest income (in thousands) | $ | 13,508 | $ | 13,248 | $ | 13,248 | ||||||
Non-interest expense (in thousands) | 37,586 | 39,413 | 29,438 | |||||||||
Income before taxes (in thousands) | 33,879 | 25,349 | 35,324 | |||||||||
Federal income taxes (in thousands) | 11,194 | 8,268 | 11,759 | |||||||||
Net income (in thousands) | 22,685 | 17,081 | 23,565 | |||||||||
Return on average assets | 1.09 | % | 1.11 | % | 1.52 | % | ||||||
Return on average common equity | 7.30 | % | 6.09 | % | 8.40 | % | ||||||
Return on average tangible common equity | 24.89 | % | 20.82 | % | 28.73 | % | ||||||
Earnings per share (basic) | $ | 0.49 | $ | 0.39 | $ | 0.53 | ||||||
Earnings per share (diluted) | $ | 0.49 | $ | 0.38 | $ | 0.53 | ||||||
Shareholders’ equity (in thousands) | $ | 1,255,106 | $ | 1,127,431 | $ | 1,127,431 | ||||||
| As reported (with charge) Dec 31, 2008 | Without Charge Dec 31, 2008 | As reported (with charge) Dec 31, 2007 | Without charge Dec 31, 2007 | |||||||||||||
| (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | |||||||||||||
| 12 Months Ended | ||||||||||||||||
Non-interest income (in thousands) | $ | 52,370 | $ | 52,370 | $ | 52,923 | $ | 52,923 | ||||||||
Non-interest expense (in thousands) | 143,796 | 129,771 | 126,843 | 116,868 | ||||||||||||
Income before taxes (in thousands) | 126,436 | 140,461 | 125,755 | 135,730 | ||||||||||||
Federal income taxes (in thousands) | 41,929 | 46,838 | 41,604 | 45,095 | ||||||||||||
Net income (in thousands) | 84,507 | 93,623 | 84,151 | 90,635 | ||||||||||||
Return on average assets | 1.20 | % | 1.33 | % | 1.38 | % | 1.49 | % | ||||||||
Return on average common equity | 7.09 | % | 7.85 | % | 8.09 | % | 8.72 | % | ||||||||
Return on average tangible common equity | 24.16 | % | 26.77 | % | 30.03 | % | 32.34 | % | ||||||||
Earnings per share (basic) | $ | 1.87 | $ | 2.07 | $ | 1.96 | $ | 2.11 | ||||||||
Earnings per share (diluted) | $ | 1.86 | $ | 2.06 | $ | 1.94 | $ | 2.09 | ||||||||
Shareholders’ equity (in thousands) | $ | 1,255,106 | $ | 1,255,106 | $ | 1,127,431 | $ | 1,127,431 | ||||||||
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Assumption of deposits and acquisition of certain assets from the FDIC as receiver for Franklin Bank, SSB
On November 7, 2008, Prosperity Bank® assumed approximately $3.6 billion of deposits, including all uninsured deposits, from the FDIC, acting in its capacity as receiver for Franklin Bank. The FDIC entered into a purchase and assumption agreement with Prosperity Bank, which paid a premium to ensure that all deposits of Franklin Bank, both insured and uninsured, were transferred to Prosperity Bank. Under terms of the purchase and assumption agreement, Prosperity acquired certain assets from the FDIC, including approximately $350 million in US Treasury and Agency Securities and approximately $350 million in performing loans. The remaining net proceeds were predominately invested in US Agency Securities.
While Franklin Bank operated forty-five (45) full service banking offices, Prosperity expects to continue to operate no more than thirty-three (33) of these locations upon the completion of the operational integration expected to occur during the first quarter of 2009. The former Franklin Bank locations planned to be closed will be consolidated into nearby Prosperity Bank locations.
Results of operations for the twelve months ended December 31, 2008
For the twelve months ended December 31, 2008, net income was $84.507 million compared with $84.151 million for the same period in 2007. Net income per diluted common share was $1.86 for the twelve months ended December 31, 2008 compared with $1.94 for the same period in 2007.
Returns on average assets, average common equity and average tangible common equity for the twelve months ended December 31, 2008 were 1.20%, 7.09% and 24.16%, respectively. Prosperity’s efficiency ratio (excluding impairment charge on Fannie Mae and Freddie Mac perpetual preferred securities and net gains and losses on the sale of securities and assets) was 46.51% for the twelve months ended December 31, 2008.
Net interest income before provision for credit losses for the twelve months ended December 31, 2008 increased $27.294 million or 13.6%, to $227.729 million compared with $200.435 million during the same period in 2007. The increase was attributable primarily to a 16.2% increase in average earning assets.
Non-interest income decreased $553,000 or 1.0% to $52.370 million for the twelve months ended December 31, 2008 compared with $52.923 million for the same period in 2007. The decrease was mainly attributable to (i) an increase in net loss on sale of ORE, (ii) a decrease in gain on sale of held for sale loans and (iii) a decrease in other non-interest income which includes decreases in dividends received on Federal Home Loan Bank stock and trust and investment income, partially offset by an increase in service charges on deposit accounts. The increase in service charges on deposit accounts is primarily attributed to an increased number of deposit accounts assumed from the FDIC as a part of the Franklin Bank transaction and deposit accounts assumed from the Banco Popular and 1st Choice acquisitions as well as an increase in debit card income.
Non-interest expense increased $16.953 million or 13.4% to $143.796 million for the twelve months ended December 31, 2008 compared with $126.843 million for the same period in 2007. The increase was due primarily to (i) an increase in salaries and benefits expense due to annual merit increases, incentive programs and the Franklin Bank transaction, (ii) an increase in general operating costs associated with the banking centers acquired in 2008 and the banking offices that were previously locations of Franklin Bank and (iii) an increase in impairment charge on write-down of securities.
The provision for credit losses was $9.867 million for the twelve months ended December 31, 2008 and $760,000 for the twelve months ended December 31, 2007. As mentioned earlier, Prosperity’s loan loss reserve model called for increased provisioning in the fourth quarter of 2008 due to increased loans acquired
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from the FDIC as a part of the Franklin Bank transaction and a general weakening of the economy. Net charge offs were $7.621 million for the twelve months ended December 31, 2008 and $5.593 million for the twelve months ended December 31, 2007.
Conference Call
Prosperity’s management team will host a conference call on Tuesday, January 27, 2009 at 10:30 a.m. Eastern Standard Time (9:30 a.m. Central Standard Time) to discuss Prosperity’s fourth quarter and full year 2008 earnings. Individuals and investment professionals may participate in the call by dialing 1-800-894-5910, the reference code is PBTX.
Alternatively, individuals may listen to the live webcast of the presentation by visiting Prosperity’s website atwww.prosperitybanktx.com. The webcast may be accessed directly from Prosperity’s Investor Relations page by clicking on the “4th Quarter Results and Webcast” link.
Acquisition of 1st Choice Bancorp, Inc.
On June 1, 2008, Prosperity completed its previously announced acquisition of 1st Choice Bancorp, Inc. and its wholly owned subsidiary, 1st Choice Bank. 1st Choice Bancorp, Inc. operated two (2) banking offices in Houston, Texas, with one location in South Houston and another in the Heights area, which was consolidated with Prosperity’s Heights location and is located in 1st Choice’s Heights banking office. As of May 31, 2008, 1st Choice Bancorp reported total assets of approximately $314.9 million, loans of approximately $192.7 million, deposits of approximately $285.2 million and stockholders’ equity of approximately $26.4 million.
In connection with the acquisition, Prosperity issued 1,757,757 shares of its common stock and paid approximately $18.758 million in cash for all outstanding shares of 1st Choice Bancorp.
Acquisition of Banco Popular’s Houston Branches
On January 10, 2008, Prosperity Bank® completed its previously announced acquisition of six (6) Houston retail bank branches from Banco Popular North America. The branches had approximately $125 million in combined deposits. All six (6) locations are now operating as full service banking centers of Prosperity Bank®.
Prosperity Bancshares, Inc.®
Prosperity Bancshares, Inc.®, a $9.1 billion Houston, Texas based regional financial holding company, formed in 1983, operates under a community banking philosophy and seeks to develop broad customer relationships based on service and convenience. Prosperity offers a variety of traditional loan and deposit products to its customers, which consist primarily of small and medium sized businesses and consumers. In addition to established banking products, Prosperity offers a complete line of services including: Internet Banking services athttp://www.prosperitybanktx.com, Retail Brokerage Services, MasterMoney Debit Cards, and 24 hour voice response banking. Prosperity currently operates over one hundred fifty-eight (158) full service banking locations; forty-seven (47) in the Houston area; thirty-one (31) in the South Texas area including Corpus Christi and Victoria; twenty-four (24) in the Dallas/Fort Worth area; twenty (20) in the East Texas area; and thirty-six (36) in the Central Texas area including Austin, Bryan/College Station and San Antonio.
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| Central Texas Area - | Dallas/Fort Worth Area - | Palestine | Magnolia | |||
| Rusk | Mont Belvieu | |||||
| Austin - | Dallas - | Seven Points | Nederland | |||
| Allandale | Abrams Centre | Tyler | Needville | |||
| Cedar Park | Balch Springs | Tyler-University | Sweeny | |||
| Congress | Camp Wisdom | Winnsboro | Tomball | |||
| 183 | Cedar Hill | Waller | ||||
| Lakeway | Central Expressway | West Columbia | ||||
| Liberty Hill | Frisco | Houston Area - | Winnie | |||
| Northland | Frisco-West | Wirt | ||||
| Oak Hill | Kiest | Houston - | ||||
| Parmer Lane | Preston Road | Aldine | ||||
| Research Blvd | Red Oak | Bellaire | South Texas Area - | |||
| Rollingwood | The Colony | Clear Lake | ||||
| Slaughter Lane | Turtle Creek | Copperfield | Corpus Christi - | |||
| Westmoreland | Cypress | Airline | ||||
| Downtown | Carmel | |||||
| Bryan/College Station - | Fairfield | Northwest | ||||
| Bryan | Fort Worth - | Gessner | Saratoga | |||
| Bryan- East | Haltom City | Gladebrook | Water Street | |||
| Bryan- North | Keller | Harrisburg | ||||
| College Station | Roanoke | Heights | Other South Texas | |||
| Greens Prairie | Stockyards | Highway 6 West | Locations - | |||
| Wellborn Road | Hillcroft | Alice | ||||
| Rock Prairie | Little York | Aransas Pass | ||||
| Other Dallas/Fort Worth | Medical Center | Bay City | ||||
| Locations - | Memorial Drive | Beeville | ||||
| Other Central Texas | Azle | Pasadena | Cuero | |||
| Locations - | Ennis | Pecan Grove | East Bernard | |||
| Bastrop | Gainesville | River Oaks | Edna | |||
| Caldwell | Mesquite | Sugar Land | El Campo | |||
| Dime Box | Muenster | SW Medical Center | Goliad | |||
| Dripping Springs | Sanger | Tanglewood | Gonzales | |||
| Elgin | Waxahachie | Uptown | Hallettsville | |||
| Flatonia | Waugh Drive | Kingsville | ||||
| Georgetown | Westheimer | Mathis | ||||
| Kingsland | East Texas Area - | Woodcreek | Palacios | |||
| La Grange | Athens | Pleasanton | ||||
| Lexington | Athens-South | Other Houston Area | Port Aransas | |||
| Navasota | Blooming Grove | Locations - | Port Lavaca | |||
| New Braunfels | Canton | Angleton | Portland | |||
| Round Rock | Carthage | Beaumont | Rockport | |||
| San Antonio | Corsicana | Cinco Ranch | Seguin | |||
| Schulenburg | Crockett | Cleveland | Sinton | |||
| Smithville | Eustace | Dayton | Victoria | |||
| Weimar | Grapeland | Galveston | Victoria-North | |||
| Gun Barrel City | Groves | Wharton | ||||
| Jacksonville | Hempstead | Yoakum | ||||
| Kerens | Hitchcock | Yorktown | ||||
| Longview | Katy | |||||
| Mount Vernon | Liberty |
“Safe Harbor” Statement under the Private Securities Litigation Reform Act of 1995: This release contains, and the remarks by our management on the conference call may contain, forward-looking statements within the meaning of the securities laws that are based on current expectations, assumptions, estimates and projections about Prosperity Bancshares®, and its subsidiaries. These forward-looking statements are not guarantees of future performance and are subject to risks and uncertainties, many of which are outside of Prosperity’s control, that may cause actual results to differ materially from those expressed or implied by the forward-looking statements. These risks and uncertainties include but are not limited to whether Prosperity can: successfully identify acquisition targets and integrate the businesses of acquired companies and banks; continue to sustain its current internal growth rate or total growth rate; provide products and services that appeal to its customers; continue to have access to debt and equity capital markets; and achieve its sales objectives. Other risks include, but are not limited to: the possibility that credit quality could deteriorate; actions of competitors; changes in laws and regulations (including changes in governmental interpretations of regulations and changes in accounting standards); a deterioration or downgrade in the credit quality and credit agency ratings of the securities in Prosperity’s securities portfolio; customer and consumer demand, including customer and consumer response to marketing; effectiveness of spending, investments or programs; fluctuations in the cost and availability of supply chain resources; economic conditions, including currency rate fluctuations and interest rate fluctuations; weather; and the stock price volatility associated with “small-cap” companies. These and various other factors are discussed in Prosperity’s Annual Report on Form 10-K for the year ended December 31, 2007 and other reports and statements we have filed with the SEC. Copies of the SEC filings for Prosperity Bancshares’s® may be downloaded from the Internet at no charge fromwww.prosperitybanktx.com.
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Prosperity Bancshares, Inc.®
Financial Highlights
(Dollars and share amounts in thousands, except per share data)
| Three Months Ended | Twelve Months Ended | |||||||||||
| Dec 31, 2008 | Dec 31, 2007 | Dec 31, 2008 | Dec 31, 2007 | |||||||||
| (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | |||||||||
| Selected Earnings and Per Share Data | ||||||||||||
Total interest income | $ | 96,588 | $ | 85,441 | $ | 347,878 | $ | 340,608 | ||||
Total interest expense | 32,631 | 33,807 | 120,149 | 140,173 | ||||||||
Net interest income | 63,957 | 51,634 | 227,729 | 200,435 | ||||||||
Provision for credit losses | 6,000 | 120 | 9,867 | 760 | ||||||||
Net interest income after provision for credit losses | 57,957 | 51,514 | 217,862 | 199,675 | ||||||||
Total non-interest income | 13,508 | 13,248 | 52,370 | 52,923 | ||||||||
Total non-interest expense | 37,586 | 39,413 | 143,796 | 126,843 | ||||||||
Net income before taxes | 33,879 | 25,349 | 126,436 | 125,755 | ||||||||
Federal income taxes | 11,194 | 8,268 | 41,929 | 41,604 | ||||||||
Net income | $ | 22,685 | $ | 17,081 | $ | 84,507 | $ | 84,151 | ||||
Basic earnings per share | $ | 0.49 | $ | 0.39 | $ | 1.87 | $ | 1.96 | ||||
Diluted earnings per share | $ | 0.49 | $ | 0.38 | $ | 1.86 | $ | 1.94 | ||||
Period end shares outstanding | 46,080 | 44,151 | 46,080 | 44,151 | ||||||||
Weighted average shares outstanding (basic) | 46,078 | 44,133 | 45,300 | 42,928 | ||||||||
Weighted average shares outstanding (diluted) | 46,276 | 44,420 | 45,479 | 43,310 | ||||||||
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Prosperity Bancshares, Inc.®
Financial Highlights
(Dollars in thousands)
| Three Months Ended | Twelve Months Ended | |||||||||||||||
| Dec 31, 2008 | Dec 31, 2007 | Dec 31, 2008 | Dec 31, 2007 | |||||||||||||
| (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | |||||||||||||
| Balance Sheet Averages | ||||||||||||||||
Total loans | $ | 3,365,552 | $ | 3,136,515 | $ | 3,250,447 | $ | 3,092,797 | ||||||||
Investment securities | 3,229,874 | 1,801,443 | 2,409,758 | 1,849,613 | ||||||||||||
Federal funds sold and other temporary investments | 451,524 | 111,059 | 163,746 | 71,462 | ||||||||||||
Total earning assets | 7,046,950 | 5,049,017 | 5,823,951 | 5,013,872 | ||||||||||||
Allowance for credit losses | (33,494 | ) | (34,595 | ) | (33,004 | ) | (34,705 | ) | ||||||||
Cash and due from banks | 183,507 | 141,696 | 146,647 | 142,645 | ||||||||||||
Goodwill | 835,328 | 746,427 | 798,289 | 717,419 | ||||||||||||
Core Deposit Intangibles (CDI) | 42,657 | 47,372 | 44,291 | 42,314 | ||||||||||||
Other real estate | 6,431 | 5,622 | 8,343 | 2,451 | ||||||||||||
Fixed assets, net | 124,210 | 120,720 | 124,114 | 117,024 | ||||||||||||
Other assets | 138,298 | 106,099 | 112,787 | 93,044 | ||||||||||||
Total assets | $ | 8,343,887 | $ | 6,182,358 | $ | 7,025,418 | $ | 6,094,064 | ||||||||
Non-interest bearing deposits | $ | 1,425,440 | $ | 1,182,179 | $ | 1,271,408 | $ | 1,143,114 | ||||||||
Interest bearing deposits | 5,260,084 | 3,602,925 | 4,200,033 | 3,584,405 | ||||||||||||
Total deposits | 6,685,524 | 4,785,104 | 5,471,441 | 4,727,519 | ||||||||||||
Securities sold under repurchase agreements | 92,941 | 66,538 | 84,289 | 71,165 | ||||||||||||
Federal funds purchased and other borrowings | 178,369 | 41,106 | 124,619 | 83,478 | ||||||||||||
Junior subordinated debentures | 92,265 | 112,885 | 99,998 | 124,613 | ||||||||||||
Other liabilities | 52,297 | 54,839 | 52,778 | 47,334 | ||||||||||||
Shareholders’ equity (A) | 1,242,491 | 1,121,886 | 1,192,293 | 1,039,955 | ||||||||||||
Total liabilities and equity | $ | 8,343,887 | $ | 6,182,358 | $ | 7,025,418 | $ | 6,094,064 | ||||||||
(A) | Includes ($1,675) and ($2,287), in after-tax unrealized gains (losses) on available for sale securities for the three month periods ending December 31, 2008 and December 31, 2007, respectively and ($1,251) and ($2,418) for the twelve month periods ending December 31, 2008 and December 31, 2007, respectively. |
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Prosperity Bancshares, Inc.®
Financial Highlights
(Dollars in thousands)
| Three Months Ended | Twelve Months Ended | ||||||||||||||
| Dec 31, 2008 | Dec 31, 2007 | Dec 31, 2008 | Dec 31, 2007 | ||||||||||||
| (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | ||||||||||||
| Income Statement Data | |||||||||||||||
Interest on loans | $ | 56,073 | $ | 61,682 | $ | 227,466 | $ | 247,600 | |||||||
Interest on securities | 39,713 | 22,446 | 118,185 | 89,467 | |||||||||||
Interest on federal funds sold and other temporary investments | 802 | 1,313 | 2,227 | 3,541 | |||||||||||
Total interest income | 96,588 | 85,441 | 347,878 | 340,608 | |||||||||||
Interest expense - deposits | 29,663 | 30,354 | 107,692 | 122,682 | |||||||||||
Interest expense - debentures | 1,452 | 2,206 | 6,439 | 10,058 | |||||||||||
Interest expense - other | 1,516 | 1,247 | 6,018 | 7,433 | |||||||||||
Total interest expense | 32,631 | 33,807 | 120,149 | 140,173 | |||||||||||
Net interest income(B) | 63,957 | 51,634 | 227,729 | 200,435 | |||||||||||
Provision for credit losses | 6,000 | 120 | 9,867 | 760 | |||||||||||
Net interest income after provision for credit losses | 57,957 | 51,514 | 217,862 | 199,675 | |||||||||||
Service charges on deposit accounts | 13,204 | 11,029 | 45,785 | 40,937 | |||||||||||
Net gain on sale of assets | 130 | 91 | 845 | 274 | |||||||||||
Net (loss) gain on sale of ORE | (1,684 | ) | (6 | ) | (2,332 | ) | 545 | ||||||||
Brokered mortgage income | 34 | 105 | 330 | 679 | |||||||||||
Net gain on sale of held for sale loans | 0 | 132 | 229 | 1,334 | |||||||||||
Gain on sale of securities | 0 | 28 | 0 | 86 | |||||||||||
Other non-interest income | 1,824 | 1,869 | 7,513 | 9,068 | |||||||||||
Total non-interest income | 13,508 | 13,248 | 52,370 | 52,923 | |||||||||||
Salaries and benefits(C) | 20,411 | 15,747 | 70,818 | 63,910 | |||||||||||
CDI amortization | 2,284 | 2,620 | 9,797 | 9,917 | |||||||||||
Net occupancy and equipment | 3,704 | 2,775 | 12,469 | 10,534 | |||||||||||
Depreciation | 1,854 | 1,955 | 7,666 | 7,611 | |||||||||||
Data processing and software amortization | 1,609 | 1,123 | 5,580 | 4,570 | |||||||||||
Impairment charge on write-down of securities | 0 | 9,975 | 14,025 | 9,975 | |||||||||||
Other non-interest expense | 7,724 | 5,218 | 23,441 | 20,326 | |||||||||||
Total non-interest expense | 37,586 | 39,413 | 143,796 | 126,843 | |||||||||||
Net income before taxes | 33,879 | 25,349 | 126,436 | 125,755 | |||||||||||
Federal income taxes | 11,194 | 8,268 | 41,929 | 41,604 | |||||||||||
Net income available to common shareholders | $ | 22,685 | $ | 17,081 | $ | 84,507 | $ | 84,151 | |||||||
(B) | Net interest income on a tax equivalent basis would be $64,597 and $52,467 for the three months ended December 31, 2008 and December 31, 2007, respectively and $230,592 and $203,554 for the twelve months ended December 31, 2008 and December 31, 2007, respectively. |
(C) | Salaries and benefits includes equity compensation expenses of $432 and $477 for the three months ended December 31, 2007 and December 31, 2008, respectively and $1,543 and $1,968 for the twelve months ended December 31, 2008 and December 31, 2007, respectively. |
Page 10 of 20
Prosperity Bancshares, Inc.®
Financial Highlights
(Dollars and share amounts in thousands, except per share data)
| As of and for the Three Months Ended | As of and for the Twelve Months Ended | |||||||||||
| Dec 31, 2008 | Dec 31, 2007 | Dec 31, 2008 | Dec 31, 2007 | |||||||||
| (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | |||||||||
Common Share and Other Data | ||||||||||||
Employees - FTE | 1,734 | 1,359 | 1,734 | 1,359 | ||||||||
Book value per share | $ | 27.24 | $ | 25.54 | $ | 27.24 | $ | 25.54 | ||||
Tangible book value per share | $ | 7.40 | $ | 7.42 | $ | 7.40 | $ | 7.42 | ||||
Period end shares outstanding | 46,080 | 44,151 | 46,080 | 44,151 | ||||||||
Weighted average shares outstanding (basic) | 46,078 | 44,133 | 45,300 | 42,928 | ||||||||
Weighted average shares outstanding (diluted) | 46,276 | 44,420 | 45,479 | 43,310 | ||||||||
Non-accrual loans | $ | 2,142 | $ | 1,035 | $ | 2,142 | $ | 1,035 | ||||
Accruing loans 90 or more days past due | 7,594 | 4,092 | 7,594 | 4,092 | ||||||||
Restructured loans | 0 | 0 | 0 | 0 | ||||||||
Total non-performing loans | 9,736 | 5,127 | 9,736 | 5,127 | ||||||||
Repossessed assets | 182 | 56 | 182 | 56 | ||||||||
Other real estate | 4,450 | 10,207 | 4,450 | 10,207 | ||||||||
Total non-performing assets | $ | 14,368 | $ | 15,390 | $ | 14,368 | $ | 15,390 | ||||
Allowance for credit losses at end of period | $ | 36,970 | $ | 32,543 | $ | 36,970 | $ | 32,543 | ||||
Net charge-offs | $ | 3,011 | $ | 3,113 | $ | 7,621 | $ | 5,593 | ||||
Basic earnings per share | $ | 0.49 | $ | 0.39 | $ | 1.87 | $ | 1.96 | ||||
Diluted earnings per share | $ | 0.49 | $ | 0.38 | $ | 1.86 | $ | 1.94 | ||||
Page 11 of 20
Prosperity Bancshares, Inc.®
Financial Highlights
| Three Months Ended | Twelve Months Ended | |||||||||||||||
| Dec 31, 2008 | Dec 31, 2007 | Dec 31, 2008 | Dec 31, 2007 | |||||||||||||
| (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | |||||||||||||
Performance Ratios | ||||||||||||||||
Return on average assets (annualized) | 1.09 | % | 1.11 | % | 1.20 | % | 1.38 | % | ||||||||
Return on average common equity (annualized) | 7.30 | % | 6.09 | % | 7.09 | % | 8.09 | % | ||||||||
Return on average tangible common equity (annualized) | 24.89 | % | 20.82 | % | 24.16 | % | 30.03 | % | ||||||||
Net interest margin(D) (tax equivalent) (annualized) | 3.65 | % | 4.12 | % | 3.96 | % | 4.06 | % | ||||||||
Efficiency ratio (E) | 48.60 | % | 45.45 | % | 46.51 | % | 46.19 | % | ||||||||
Asset Quality Ratios | ||||||||||||||||
Non-performing assets to average earning assets | 0.20 | % | 0.30 | % | 0.25 | % | 0.31 | % | ||||||||
Non-performing assets to loans and other real estate | 0.40 | % | 0.49 | % | 0.40 | % | 0.49 | % | ||||||||
Net charge-offs to average loans | 0.09 | % | 0.10 | % | 0.23 | % | 0.18 | % | ||||||||
Allowance for credit losses to total loans | 1.04 | % | 1.04 | % | 1.04 | % | 1.04 | % | ||||||||
Common Stock Market Price | ||||||||||||||||
High | $ | 36.98 | $ | 35.07 | $ | 46.48 | $ | 37.11 | ||||||||
Low | $ | 25.08 | $ | 28.18 | $ | 21.96 | $ | 27.70 | ||||||||
Period end market price | $ | 29.59 | $ | 29.39 | $ | 29.59 | $ | 29.39 | ||||||||
(D) | Net interest margin for all periods presented is calculated on an actual 365 or actual 366 day basis. |
(E) | The Company revised its efficiency ratio which is calculated by dividing total non-interest expense (excluding credit loss provisions) by net interest income plus non-interest income (excluding net gains and losses on the sale of securities and assets and impairment charge on write-down of securities). Prior period amounts have been restated to reflect the current methodology. Additionally, taxes are not part of this calculation. |
Page 12 of 20
Prosperity Bancshares, Inc.®
Financial Highlights
(Dollars in thousands)
| Dec 31, 2008 | Sept 30, 2008 | June 30, 2008 | Mar 31, 2008 | |||||||||||||||||||||||||
| (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | |||||||||||||||||||||||||
Loan Portfolio | ||||||||||||||||||||||||||||
Commercial | $ | 499,143 | 13.99 | % | $ | 470,099 | 14.50 | % | $ | 486,817 | 14.70 | % | $ | 452,635 | 14.30 | % | ||||||||||||
Construction | 666,080 | 18.67 | % | 626,443 | 19.30 | % | 658,669 | 19.90 | % | 664,679 | 21.00 | % | ||||||||||||||||
1-4 family residential | 668,096 | 18.73 | % | 574,583 | 17.70 | % | 568,377 | 17.10 | % | 546,765 | 17.30 | % | ||||||||||||||||
Home equity | 107,048 | 3.01 | % | 95,962 | 3.00 | % | 95,774 | 2.90 | % | 94,559 | 3.00 | % | ||||||||||||||||
Commercial real estate | 1,343,401 | 37.66 | % | 1,229,219 | 37.80 | % | 1,241,872 | 37.50 | % | 1,161,668 | 36.70 | % | ||||||||||||||||
Agriculture | 145,649 | 4.08 | % | 133,123 | 4.10 | % | 135,421 | 4.10 | % | 119,346 | 3.80 | % | ||||||||||||||||
Consumer | 137,640 | 3.86 | % | 119,188 | 3.60 | % | 126,398 | 3.80 | % | 121,975 | 3.90 | % | ||||||||||||||||
Total Loans | $ | 3,567,057 | $ | 3,248,617 | $ | 3,313,328 | $ | 3,161,627 | ||||||||||||||||||||
Deposit Types | ||||||||||||||||||||||||||||
Non-interest bearing DDA | $ | 1,540,599 | 21.05 | % | $ | 1,263,407 | 24.70 | % | $ | 1,285,493 | 24.30 | % | $ | 1,202,622 | 24.30 | % | ||||||||||||
Interest bearing DDA | 1,082,078 | 14.78 | % | 707,055 | 13.90 | % | 750,214 | 14.20 | % | 769,440 | 15.50 | % | ||||||||||||||||
Money Market | 1,400,673 | 19.14 | % | 1,147,559 | 22.50 | % | 1,213,710 | 22.90 | % | 1,042,744 | 21.10 | % | ||||||||||||||||
Savings | 309,938 | 4.23 | % | 246,370 | 4.80 | % | 251,815 | 4.70 | % | 239,633 | 4.80 | % | ||||||||||||||||
Time < $100 | 1,577,431 | 21.55 | % | 814,165 | 15.90 | % | 840,744 | 15.90 | % | 819,671 | 16.60 | % | ||||||||||||||||
Time > $100 | 1,408,908 | 19.25 | % | 926,286 | 18.20 | % | 954,658 | 18.00 | % | 874,608 | 17.70 | % | ||||||||||||||||
Total Deposits | $ | 7,319,627 | $ | 5,104,842 | $ | 5,296,634 | $ | 4,948,718 | ||||||||||||||||||||
Loan to Deposit Ratio | 48.7 | % | 63.6 | % | 62.6 | % | 63.9 | % | ||||||||||||||||||||
Construction Loans | ||||||||||||||||||||||||||||
Single family residential construction | $ | 237,191 | 35.61 | % | $ | 233,196 | 37.23 | % | $ | 244,250 | 37.08 | % | ||||||||||||||||
Land development | 90,846 | 13.64 | % | 73,955 | 11.81 | % | 75,376 | 11.44 | % | |||||||||||||||||||
Raw land | 89,120 | 13.38 | % | 90,974 | 14.52 | % | 98,341 | 14.93 | % | |||||||||||||||||||
Residential lots | 106,869 | 16.04 | % | 101,027 | 16.13 | % | 104,384 | 15.85 | % | |||||||||||||||||||
Commercial lots | 39,374 | 5.91 | % | 35,890 | 5.73 | % | 37,714 | 5.73 | % | |||||||||||||||||||
Other | 102,680 | 15.42 | % | 91,401 | 14.58 | % | 98,604 | 14.97 | % | |||||||||||||||||||
Total Construction Loans | $ | 666,080 | $ | 626,443 | $ | 658,669 | ||||||||||||||||||||||
Page 13 of 20
Prosperity Bancshares, Inc.®
Financial Highlights
(Dollars in thousands)
| Dec 31, 2008 | Sept 30, 2008 | June 30, 2008 | Mar 31, 2008 | Dec 31, 2007 | ||||||||||||||||
| (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | ||||||||||||||||
Balance Sheet Data (at period end) | ||||||||||||||||||||
Total loans | $ | 3,567,057 | $ | 3,248,617 | $ | 3,313,328 | $ | 3,161,627 | $ | 3,142,971 | ||||||||||
Investment securities(F) | 4,160,401 | 2,294,403 | 2,235,703 | 2,086,382 | 1,857,606 | |||||||||||||||
Federal funds sold and other temporary investments | 16,404 | 25,748 | 14,230 | 32,268 | 193,043 | |||||||||||||||
Total earning assets | 7,743,862 | 5,568,768 | 5,563,261 | 5,280,277 | 5,193,620 | |||||||||||||||
Allowance for credit losses | (36,970 | ) | (33,981 | ) | (34,085 | ) | (32,067 | ) | (32,543 | ) | ||||||||||
Cash and due from banks | 212,335 | 159,386 | 170,966 | 159,754 | 178,247 | |||||||||||||||
Goodwill | 876,054 | 811,916 | 811,391 | 769,013 | 753,909 | |||||||||||||||
Core deposit intangibles | 38,196 | 44,974 | 47,536 | 43,577 | 46,069 | |||||||||||||||
Other real estate | 4,450 | 7,538 | 6,655 | 11,612 | 10,207 | |||||||||||||||
Fixed assets, net | 123,638 | 123,823 | 125,000 | 123,806 | 120,044 | |||||||||||||||
Other assets | 112,551 | 105,485 | 103,010 | 108,761 | 102,790 | |||||||||||||||
Total assets | $ | 9,074,116 | $ | 6,787,909 | $ | 6,793,734 | $ | 6,464,733 | $ | 6,372,343 | ||||||||||
Demand deposits | $ | 1,540,599 | $ | 1,263,407 | $ | 1,285,493 | $ | 1,202,622 | $ | 1,168,069 | ||||||||||
Interest bearing deposits | 5,779,028 | 3,841,435 | 4,011,141 | 3,746,096 | 3,798,338 | |||||||||||||||
Total deposits | 7,319,627 | 5,104,842 | 5,296,634 | 4,948,718 | 4,966,407 | |||||||||||||||
Securities sold under repurchase agreements | 96,017 | 100,310 | 99,225 | 70,942 | 84,581 | |||||||||||||||
Federal funds purchased and other borrowings | 229,395 | 219,671 | 42,089 | 125,360 | 31,466 | |||||||||||||||
Junior subordinated debentures | 92,265 | 92,265 | 92,265 | 112,885 | 112,885 | |||||||||||||||
Other liabilities | 81,706 | 41,641 | 45,916 | 58,761 | 49,573 | |||||||||||||||
Total liabilities | 7,819,010 | 5,558,729 | 5,576,129 | 5,316,666 | 5,244,912 | |||||||||||||||
Shareholders’ equity(G) | 1,255,106 | 1,229,180 | 1,217,605 | 1,148,067 | 1,127,431 | |||||||||||||||
Total liabilities and equity | $ | 9,074,116 | $ | 6,787,909 | $ | 6,793,734 | $ | 6,464,733 | $ | 6,372,343 | ||||||||||
(F) | Includes $15,158, $1,220, ($633), $3,903 and ($7,795) in unrealized gains (losses) on available for sale securities for the quarterly periods ending December 31, 2008, September 30, 2008, June 30, 2008, March 31, 2008 and December 31, 2007, respectively. |
(G) | Includes $9,853, $793, ($411), $2,537 and ($5,067) in after-tax unrealized gains (losses) on available for sale securities for the quarterly periods ending December 31, 2008, September 30, 2008, June 30, 2008, March 31, 2008 and December 31, 2007, respectively. |
Page 14 of 20
Prosperity Bancshares, Inc.®
Financial Highlights
(Dollars in thousands)
| Three Months Ended | |||||||||||||||||||
| Dec 31, 2008 | Sept 30, 2008 | June 30, 2008 | Mar 31, 2008 | Dec 31, 2007 | |||||||||||||||
| (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | |||||||||||||||
Income Statement Data | |||||||||||||||||||
Interest on loans | $ | 56,073 | $ | 56,925 | $ | 55,948 | $ | 58,520 | $ | 61,682 | |||||||||
Interest on securities | 39,713 | 27,834 | 25,856 | 24,783 | 22,446 | ||||||||||||||
Interest on federal funds sold and other earning assets | 802 | 87 | 175 | 1,162 | 1,313 | ||||||||||||||
Total interest income | 96,588 | 84,846 | 81,979 | 84,465 | 85,441 | ||||||||||||||
Interest expense- deposits | 29,663 | 23,874 | 25,210 | 28,945 | 30,354 | ||||||||||||||
Interest expense- debentures | 1,452 | 1,410 | 1,558 | 2,019 | 2,206 | ||||||||||||||
Interest expense- other | 1,516 | 1,756 | 1,240 | 1,506 | 1,247 | ||||||||||||||
Total interest expense | 32,631 | 27,040 | 28,008 | 32,470 | 33,807 | ||||||||||||||
Net interest income | 63,957 | 57,806 | 53,971 | 51,995 | 51,634 | ||||||||||||||
Provision for credit losses | 6,000 | 1,700 | 1,000 | 1,167 | 120 | ||||||||||||||
Net interest income after provision for credit losses | 57,957 | 56,106 | 52,971 | 50,828 | 51,514 | ||||||||||||||
Service charges on deposits accounts | 13,204 | 11,348 | 10,727 | 10,506 | 11,029 | ||||||||||||||
Net gain on sale of assets | 130 | 34 | 676 | 4 | 91 | ||||||||||||||
Net (loss) gain on sale of ORE | (1,684 | ) | (210 | ) | (478 | ) | 39 | (6 | ) | ||||||||||
Brokered mortgage income | 34 | 74 | 113 | 109 | 105 | ||||||||||||||
Net gain on sale of held for sale loans | 0 | 46 | 110 | 73 | 132 | ||||||||||||||
Gain on sale of securities | 0 | 0 | 0 | 0 | 28 | ||||||||||||||
Other non-interest income | 1,824 | 1,825 | 1,918 | 1,948 | 1,869 | ||||||||||||||
Total non-interest income | 13,508 | 13,117 | 13,066 | 12,679 | 13,248 | ||||||||||||||
Salaries and benefits | 20,411 | 17,526 | 16,751 | 16,130 | 15,747 | ||||||||||||||
CDI amortization | 2,284 | 2,562 | 2,459 | 2,492 | 2,620 | ||||||||||||||
Net occupancy and equipment | 3,704 | 3,088 | 2,867 | 2,810 | 2,775 | ||||||||||||||
Depreciation | 1,854 | 1,955 | 1,920 | 1,937 | 1,955 | ||||||||||||||
Data processing and software amortization | 1,609 | 1,319 | 1,361 | 1,291 | 1,123 | ||||||||||||||
Impairment charge on write-down of securities | 0 | 14,025 | 0 | 0 | 9,975 | ||||||||||||||
Other non-interest expense | 7,724 | 5,755 | 5,502 | 4,460 | 5,218 | ||||||||||||||
Total non-interest expense | 37,586 | 46,230 | 30,860 | 29,120 | 39,413 | ||||||||||||||
Net income before taxes | 33,879 | 22,993 | 35,177 | 34,387 | 25,349 | ||||||||||||||
Federal income taxes | 11,194 | 7,546 | 11,740 | 11,449 | 8,268 | ||||||||||||||
Net income available to common shareholders | $ | 22,685 | $ | 15,447 | $ | 23,437 | $ | 22,938 | $ | 17,081 | |||||||||
Page 15 of 20
Prosperity Bancshares, Inc.®
Financial Highlights
| Three Months Ended | ||||||||||||||||||||
| Dec 31, 2008 | Sept. 30, 2008 | June 30, 2008 | Mar 31, 2008 | Dec 31, 2007 | ||||||||||||||||
| (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | ||||||||||||||||
Comparative Quarterly Asset Quality, Performance & Capital Ratios | ||||||||||||||||||||
Return on average assets (annualized) | 1.09 | % | 0.91 | % | 1.43 | % | 1.43 | % | 1.11 | % | ||||||||||
Return on average common equity (annualized) | 7.30 | % | 5.04 | % | 7.96 | % | 8.02 | % | 6.09 | % | ||||||||||
Return on average tangible equity (annualized) | 24.89 | % | 16.83 | % | 26.93 | % | 27.28 | % | 20.82 | % | ||||||||||
Net interest margin (tax equivalent) (annualized) | 3.65 | % | 4.15 | % | 4.10 | % | 4.03 | % | 4.12 | % | ||||||||||
Employees - FTE | 1,734 | 1,366 | 1,397 | 1,374 | 1,359 | |||||||||||||||
Efficiency ratio | 48.60 | % | 45.43 | % | 46.50 | % | 45.03 | % | 45.45 | % | ||||||||||
Non-performing assets to average earning assets | 0.20 | % | 0.26 | % | 0.22 | % | 0.33 | % | 0.30 | % | ||||||||||
Non-performing assets to loans and other real estate | 0.40 | % | 0.45 | % | 0.35 | % | 0.55 | % | 0.49 | % | ||||||||||
Net charge-offs to average loans | 0.09 | % | 0.05 | % | 0.04 | % | 0.05 | % | 0.10 | % | ||||||||||
Allowance for credit losses to total loans | 1.04 | % | 1.05 | % | 1.03 | % | 1.01 | % | 1.04 | % | ||||||||||
Book value per share | $ | 27.24 | $ | 26.68 | $ | 26.44 | $ | 25.93 | $ | 25.54 | ||||||||||
Tangible book value per share | $ | 7.40 | $ | 8.08 | $ | 7.79 | $ | 7.58 | $ | 7.42 | ||||||||||
Tier 1 risk-based capital | 10.31 | % | 13.31 | % | 12.70 | % | 13.16 | % | 13.13 | % | ||||||||||
Total risk-based capital | 11.21 | % | 14.29 | % | 13.67 | % | 14.11 | % | 14.11 | % | ||||||||||
Tier 1 leverage capital | 5.66 | % | 7.75 | % | 7.87 | % | 7.91 | % | 8.09 | % | ||||||||||
Tangible equity to tangible assets | 4.18 | % | 6.28 | % | 6.04 | % | 5.94 | % | 5.88 | % | ||||||||||
Equity to assets | 13.83 | % | 18.11 | % | 17.92 | % | 17.76 | % | 17.69 | % | ||||||||||
Page 16 of 20
Prosperity Bancshares, Inc.®
Supplemental Financial Data (Unaudited)
(Dollars in thousands)
| Three Months Ended December 31, 2008 | ||||||||||
| Average Balance | Interest Earned / Interest Paid | Average Yield/Rate | ||||||||
| YIELD ANALYSIS | ||||||||||
Interest Earning Assets: | ||||||||||
Loans | $ | 3,365,552 | $ | 56,073 | 6.63 | % | ||||
Investment securities | 3,229,874 | 39,713 | 4.92 | % | ||||||
Federal funds sold and other temporary investments | 451,524 | 802 | 0.71 | % | ||||||
Total interest earning assets | 7,046,950 | $ | 96,588 | 5.45 | % | |||||
Allowance for credit losses | (33,494 | ) | ||||||||
Non-interest earning assets | 1,330,431 | |||||||||
Total assets | $ | 8,343,887 | ||||||||
Interest Bearing Liabilities: | ||||||||||
Interest bearing demand deposits | $ | 839,152 | $ | 1,629 | 0.77 | % | ||||
Savings and money market deposits | 1,578,817 | 6,895 | 1.74 | % | ||||||
Certificates and other time deposits | 2,842,115 | 21,139 | 2.96 | % | ||||||
Securities sold under repurchase agreements | 92,941 | 579 | 2.48 | % | ||||||
Federal funds purchased and other borrowings | 178,369 | 937 | 2.09 | % | ||||||
Junior subordinated debentures | 92,265 | 1,452 | 6.26 | % | ||||||
Total interest bearing liabilities | 5,623,659 | $ | 32,631 | 2.31 | % | |||||
Non-interest bearing liabilities: | ||||||||||
Non-interest bearing demand deposits | 1,425,440 | |||||||||
Other liabilities | 52,297 | |||||||||
Total liabilities | 7,101,396 | |||||||||
Shareholders’ equity | 1,242,491 | |||||||||
Total liabilities and shareholders’ equity | $ | 8,343,887 | ||||||||
Net Interest Income & Margin | $ | 63,957 | 3.61 | % | ||||||
Net Interest Income & Margin (tax equivalent) | $ | 64,597 | 3.65 | % | ||||||
Page 17 of 20
Prosperity Bancshares, Inc.®
Supplemental Financial Data (Unaudited)
(Dollars in thousands)
| Three Months Ended December 31, 2007 | ||||||||||
| Average Balance | Interest Earned / Interest Paid | Average Yield/Rate | ||||||||
| YIELD ANALYSIS | ||||||||||
Interest Earning Assets: | ||||||||||
Loans | $ | 3,136,515 | $ | 61,682 | 7.80 | % | ||||
Investment securities | 1,801,443 | 22,446 | 4.98 | % | ||||||
Federal funds sold and other temporary investments | 111,059 | 1,313 | 4.69 | % | ||||||
Total interest earning assets | 5,049,017 | $ | 85,441 | 6.71 | % | |||||
Allowance for credit losses | (34,595 | ) | ||||||||
Non-interest earning assets | 1,167,936 | |||||||||
Total assets | $ | 6,182,358 | ||||||||
Interest Bearing Liabilities: | ||||||||||
Interest bearing demand deposits | $ | 826,751 | $ | 3,510 | 1.68 | % | ||||
Savings and money market deposits | 1,189,161 | 8,289 | 2.77 | % | ||||||
Certificates and other time deposits | 1,587,013 | 18,555 | 4.64 | % | ||||||
Securities sold under repurchase agreements | 66,538 | 707 | 4.22 | % | ||||||
Federal funds purchased and other borrowings | 41,106 | 540 | 5.21 | % | ||||||
Junior subordinated debentures | 112,885 | 2,206 | 7.75 | % | ||||||
Total interest bearing liabilities | 3,823,454 | $ | 33,807 | 3.51 | % | |||||
Non-interest bearing liabilities: | ||||||||||
Non-interest bearing demand deposits | 1,182,179 | |||||||||
Other liabilities | 54,839 | |||||||||
Total liabilities | 5,060,472 | |||||||||
Shareholders’ equity | 1,121,886 | |||||||||
Total liabilities and shareholders’ equity | $ | 6,182,358 | ||||||||
Net Interest Income & Margin | $ | 51,634 | 4.06 | % | ||||||
Net Interest Income & Margin (tax equivalent) | $ | 52,467 | 4.12 | % | ||||||
Page 18 of 20
Prosperity Bancshares, Inc.®
Supplemental Financial Data (Unaudited)
(Dollars in thousands)
| Twelve Months Ended December 31, 2008 | ||||||||||
| Average Balance | Interest Earned / Interest Paid | Average Yield/Rate | ||||||||
| YIELD ANALYSIS | ||||||||||
Interest Earning Assets: | ||||||||||
Loans | $ | 3,250,447 | $ | 227,466 | 7.00 | % | ||||
Investment securities | 2,409,758 | 118,185 | 4.90 | % | ||||||
Federal funds sold and other temporary investments | 163,746 | 2,227 | 1.36 | % | ||||||
Total interest earning assets | 5,823,951 | $ | 347,878 | 5.97 | % | |||||
Allowance for credit losses | (33,004 | ) | ||||||||
Non-interest earning assets | 1,234,471 | |||||||||
Total assets | $ | 7,025,418 | ||||||||
Interest Bearing Liabilities: | ||||||||||
Interest bearing demand deposits | $ | 791,739 | $ | 7,967 | 1.01 | % | ||||
Savings and money market deposits | 1,411,142 | 27,770 | 1.97 | % | ||||||
Certificates and other time deposits | 1,997,152 | 71,955 | 3.60 | % | ||||||
Securities sold under repurchase agreements | 84,289 | 2,388 | 2.83 | % | ||||||
Federal funds purchased and other borrowings | 124,619 | 3,630 | 2.91 | % | ||||||
Junior subordinated debentures | 99,998 | 6,439 | 6.44 | % | ||||||
Total interest bearing liabilities | 4,508,939 | $ | 120,149 | 2.66 | % | |||||
Non-interest bearing liabilities: | ||||||||||
Non-interest bearing demand deposits | 1,271,408 | |||||||||
Other liabilities | 52,778 | |||||||||
Total liabilities | 5,833,125 | |||||||||
Shareholders’ equity | 1,192,293 | |||||||||
Total liabilities and shareholders’ equity | $ | 7,025,418 | ||||||||
Net Interest Income & Margin | $ | 227,729 | 3.91 | % | ||||||
Net Interest Income & Margin (tax equivalent) | $ | 230,592 | 3.96 | % | ||||||
Page 19 of 20
Prosperity Bancshares, Inc.®
Supplemental Financial Data (Unaudited)
(Dollars in thousands)
| Twelve Months Ended December 31, 2007 | ||||||||||
| Average Balance | Interest Earned / Interest Paid | Average Yield/Rate | ||||||||
| YIELD ANALYSIS | ||||||||||
Interest Earning Assets: | ||||||||||
Loans | $ | 3,092,797 | $ | 247,600 | 8.01 | % | ||||
Investment securities | 1,849,613 | 89,467 | 4.84 | % | ||||||
Federal funds sold and other temporary investments | 71,462 | 3,541 | 4.96 | % | ||||||
Total interest earning assets | 5,013,872 | $ | 340,608 | 6.79 | % | |||||
Allowance for credit losses | (34,705 | ) | ||||||||
Non-interest earning assets | 1,114,897 | |||||||||
Total assets | $ | 6,094,064 | ||||||||
Interest Bearing Liabilities: | ||||||||||
Interest bearing demand deposits | $ | 829,757 | $ | 16,313 | 1.97 | % | ||||
Savings and money market deposits | 1,205,584 | 35,089 | 2.91 | % | ||||||
Certificates and other time deposits | 1,549,064 | 71,280 | 4.60 | % | ||||||
Securities sold under repurchase agreements | 71,165 | 3,026 | 4.25 | % | ||||||
Federal funds purchased and other borrowings | 83,478 | 4,407 | 5.28 | % | ||||||
Junior subordinated debentures | 124,613 | 10,058 | 8.07 | % | ||||||
Total interest bearing liabilities | 3,863,661 | $ | 140,173 | 3.63 | % | |||||
Non-interest bearing liabilities: | ||||||||||
Non-interest bearing demand deposits | 1,143,114 | |||||||||
Other liabilities | 47,334 | |||||||||
Total liabilities | 5,054,109 | |||||||||
Shareholders’ equity | 1,039,955 | |||||||||
Total liabilities and shareholders’ equity | $ | 6,094,064 | ||||||||
Net Interest Income & Margin | $ | 200,435 | 4.00 | % | ||||||
Net Interest Income & Margin (tax equivalent) | $ | 203,554 | 4.06 | % | ||||||
Page 20 of 20