Exhibit 99
Provident New York Bancorp Announces Fiscal 2009 Third Quarter Earnings of $0.23 Per Diluted Share
MONTEBELLO, N.Y.--(BUSINESS WIRE)--July 16, 2009--Provident New York Bancorp (NASDAQ-Global Select Market:PBNY), the parent company of Provident Bank, today announced third-quarter results for the fiscal year ending Sept. 30, 2009. Net income for the quarter was $9.0 million, or $0.23 per diluted share, compared to net income of $6.3 million, or $0.16 per diluted share for the third quarter of fiscal 2008. Net income for the nine months ended June 30, 2009 was $20.8 million, or $0.54 per diluted share, compared to $17.3 million, or $0.44 per diluted share for the same period in 2008.
President’s Comments
“Provident Bank continued to perform under difficult market conditions in the fiscal third quarter,” said George Strayton, President and CEO. “Most notably, while certain credit quality indicators improved such as reduced net charge-offs and nonperforming loans compared to the previous quarter, we will still face many hurdles in the months ahead, but we believe we are on the right track in terms of positioning ourselves for an eventual recovery of the economy. In addition, we grew our deposits, controlled expenses and reduced the impact of faster prepayments by locking in gains on higher coupon mortgage backed securities. These actions resulted in quality core earnings and record quarterly earnings which fortified an already strong capital position. Overall loans outstanding were flat during the quarter, as we sold most new production of 1-4 family loans into the secondary market, reducing the residential loan portfolio, while other categories grew. As we move forward, our focus will remain on preserving and growing our core business, and providing sound, prudent management of the bank.”
Key items for the quarter include:
- The Bank remained well capitalized at June 30, 2009, with total risk-based capital ratio of 13.89 percent and a Tier 1 leverage ratio of 9.04 percent. The Company’s tangible capital ratio as a percent of tangible assets was 9.55 percent compared to 9.11 percent at March 31, 2009.
- Net charge-offs totaled $1.9 million (0.44 percent of average loans on an annualized basis) a decrease of $2.4 million compared to the prior linked quarter and an increase of $1.1 million from the quarter ended June 30, 2008.
- The loan-loss provision for the third quarter was $3.5 million, a decrease of $3.6 million from the linked quarter and an increase of $2.1 million over the same quarter in fiscal 2008. The provision for the quarter was $1.6 million in excess of net charge-offs. Allowance for loan losses totaled $28.0 million, or 1.63 percent of loans outstanding and 118 percent of non-performing loans as of June 30, 2009.
- Classified loans have increased from $35.9 million to $44.2 million during the quarter.
- Realized gains on sales of securities were $10.0 million for the three months ended June 30, 2009 compared to $22,000 for the same period in 2008 and $6.1 million for the linked quarter ended March 31, 2009.
- Net interest margin on a fully tax-equivalent basis was 3.74 percent for the third quarter of fiscal 2009, compared to 4.04 percent for the third quarter of fiscal 2008 and 3.80 percent for the linked quarter.
- Commercial transaction accounts grew $32.0 million or 15 percent over the linked quarter. Total transaction accounts were $614.3 million at June 30, 2009, compared to $598.1 million at March 31, 2009. In addition to transaction account growth, savings accounts grew $12.8 million over March 31, 2009 levels.
Capital and Liquidity
Provident Bank remained well-capitalized with excellent liquidity in the third quarter, as it continued to build capital during fiscal 2009, with the Bank’s Tier 1 leverage ratio increasing to 9.04 percent. The Company’s tangible capital as a percent of tangible assets increased to 9.55 percent as of June 30, 2009, while its tangible book value improved to $6.41 from $5.78 at September 30, 2008. Total capital increased $21.6 million from September 30, 2008, to $420.8 million at June 30, 2009, due to a $12.2 million increase in the Company’s retained earnings and a $7.8 million improvement in accumulated other comprehensive income, after realizing security gains in the fiscal year of $16.4 million. The Company resumed open market stock repurchases during the quarter, acquiring 315,650 shares, with a market value of $2.5 million.
The Bank continued to focus on increasing its liquidity, and strengthening its balance sheet, which resulted in a minor compression in net interest margin in the quarter. As of June 30, 2009, the Bank maintained $62.4 million in cash at the Federal Reserve Bank compared to $6.7 million at September 30, 2008 for enhanced liquidity purposes. Further, the Bank has had no outstanding overnight borrowings under its $200 million line of credit facility with the Federal Home Loan Bank since January 2009. The Company’s high quality available for sale investment portfolio consists primarily of securities issued by U.S. Government Sponsored Agencies and general obligations of municipalities, and provides an additional source of liquidity.
Credit Quality
Net charge-offs for the quarter were $1.9 million (0.44 percent of average loans, on an annualized basis), compared to $4.3 million in the prior linked quarter and $812,000 for the quarter ended June 30, 2008. Net charge-offs of $1.3 million were in the community business loan portfolio which continues to be impacted by the ongoing sluggishness of the economy, on average outstandings of $101.9 million. Write-downs in the ADC portfolio totaled $703,000.
The Company’s loan-loss provision was $3.5 million in the third quarter, $1.6 million in excess of net charge-offs. This resulted in an increase in the allowance for loan losses to $28.0 million, or 1.63 percent of loans outstanding, and 118 percent of non-performing loans as of June 30, 2009. The primary reasons for increasing the allowance for loan losses continue to be related to the general economic slowdown and overall declining values of land in our market area.
Nonperforming loans decreased $2.6 million in the third quarter to $23.8 million, compared to $26.4 million at March 31, 2009. The Bank’s coverage ratio of nonperforming loans increased from 100 percent at March 31, 2009, to 118 percent at June 30, 2009.
The table below outlines those non-performing loans, at June 30, 2009, that are secured by real property, by category with the related weighted loan to value ratios and specific reserves against such loans:
| Loans with Specific Reserves | | Book
Value | | WLTV* | | Specific
Reserve | | WLTV after
Specific
Reserve |
| ADC | | $ | 9,524 | | | 98 | % | | $ | | 1,601 | | | 81 | % |
| Commercial mortgage | | | 1,303 | | | 70 | | | | | 122 | | | 64 | |
| Residential mortgage | | | 1,653 | | | 87 | | | | | 276 | | | 72 | |
| | | | | | | | | | | | | | |
| Loans with out Specific Reserves | | | | | | | | | | | | |
| ADC | | | 1,103 | | | 73 | | | | | - | | | 73 | |
| Commercial mortgage | | | 5,392 | | | 65 | | | | | - | | | 65 | |
| Residential Mortgage | | | 3,849 | | | 64 | | | | | - | | | 64 | |
Total Mortgage secured | | | 22,824 | | | 81 | | | | | 1,999 | | | 72 | |
| | | | | | | | | | | | | |
| Loans not Mortgage Secured | | | | | | | | | | | | |
| Loans with specific reserves | | | 121 | | | | | | | | 24 | | | | |
Loans without specific reserves | | | 835 | | | | | | | | - | | | | |
| Total non-performing loans | | | 23,780 | | | | | | | | 2,023 | | | | |
| General reserves | | | | | | | | | | 26,004 | | | | |
| Total allowance for loan losses | | | | | | | | | $ | 28,027 | | | | |
| ORE balance | | | 1,587 | | | | | | | | | | |
| Total non-performing assets | | $ | 25,367 | | | | | | | | | | |
*Weighted average LTV is the gross loan value plus negative escrows (before specific reserves) divided by current appraised value of the collateral securing the loan.
Other real estate owned in the second quarter totaled $1.6 million, reflecting a write-down of $186,000 due to the continued decline in land values from the previous linked quarter and an increase compared to $84,000 at June 30, 2008.
Net Interest Income and Margin
Third quarter fiscal 2009 compared with third quarter fiscal 2008
Net interest income was $22.7 million for the third quarter of fiscal 2009, a $1.5 million decrease from the same quarter of fiscal 2008. The net interest margin on a tax-equivalent basis was 3.74 percent for the third quarter of fiscal 2009, compared to 4.04 percent for same period a year ago. The year-over-year comparison reflects the impact of the cuts in the federal funds target rate totaling two percent. The Company executed on its planned sale program, starting in February 2009, of approximately $350 million in mortgage backed securities with a book yield of 5.15 percent and an average life of 4.1 years, which were reinvested in securities having a yield of 3.34 percent and an average life of 3.2 years. As a result, the yield on interest-earning assets declined 80 basis points. For the same period, the cost of interest-bearing deposits decreased 72 basis points to 1.04 percent, and the cost of borrowings increased 32 basis points to 3.96 percent, reflecting the carry cost of term borrowings outstanding and repayment of short-term borrowings. The tax-equivalent yield on investments decreased 48 basis points compared to the same quarter in 2008.
Third quarter fiscal 2009 compared with linked quarter ended March 31, 2009
Net interest income for the quarter ended June 30, 2009, decreased $909,000 from the quarter ended March 31, 2009. The tax-equivalent net interest margin decreased 6 basis points from 3.80 percent for the same period. During the quarter the Bank sold $252.6 million in securities and purchased $252.0 million. The overall yield of the investment portfolio declined 47 basis points at June 30, 2009. Further, proceeds from normal principal payments have been kept liquid at the Federal Reserve, earning 25 basis points on an average balance of $112.5 million. While this item significantly enhanced the liquidity position of the Bank, the low yield received had a negative impact on net interest margin in the amount of 16 basis points.
Year-to-date comparison fiscal 2009 to fiscal 2008
On a fiscal year-to-date basis, net interest income increased $1.6 million for the nine-month period ended June 30, 2009, as compared to the same period in 2008, with the tax equivalent net interest margin decreasing from 3.89 percent to 3.84 percent.
Noninterest Income
Third quarter fiscal 2009 compared with third quarter fiscal 2008
Noninterest income totaled $15.3 million for the fiscal third quarter, an increase of $10.3 million from $5.0 million in the third quarter of fiscal 2008. The increase was due to gains of $10.0 million resulting from the Company’s decision to realize a portion of the recent appreciation in its security portfolio, monetizing other comprehensive income and reducing prepayment risk. The Company may realize further gains from its security holdings, if conditions justify such action. The increase also was due to $450,000 gains on the sale of $21.4 million of loans in the third quarter. The Bank has been selling current conforming residential mortgage loan originations in the secondary market to control interest rate risk. Fee income was relatively unchanged in the third quarter.
Third quarter fiscal 2009 compared with linked quarter ended March 31, 2009
Noninterest income increased on a linked-quarter basis, due to high levels of securities gains realized.
Year-to-date comparison fiscal 2009 to fiscal 2008
Noninterest income increased $16.4 million compared to the same period in 2008. Increases were driven primarily by the gain on sale of securities with smaller contributions from gains on the sale of premises and equipment and loans sold. Modest declines were seen in investment management fees as the market value of assets under management declined.
Noninterest Expense
Third quarter fiscal 2009 compared with third quarter fiscal 2008
The Company remained focused on controlling operating expenses. Noninterest expense increased by $2.6 million, or 13.5 percent, over the third quarter of fiscal 2008, primarily due to increased FDIC assessments of $2.1 million, including $1.4 million for the special assessment based upon 5 basis points on total assets less Tier 1 capital.
Third quarter fiscal 2009 compared with linked quarter ended March 31, 2009
On a quarter-to-quarter basis, non-interest expense increased $1.4 million primarily due to costs associated with increased FDIC assessments.
Year-to-date comparison fiscal 2009 to fiscal 2008
Noninterest expense increased by $4.8 million over the same period in 2008, primarily in the areas of compensation and benefits, especially pension and medical expense increases of $1.1 million, and FDIC assessments which increased by $2.9 million.
Income Taxes
The Company’s effective tax rate was 31.0 percent for the third quarter of fiscal 2009 and 28.8 percent for the third quarter of fiscal 2008. For the linked quarter ended March 31, 2009, the Company’s effective tax rate was 26.9 percent.
Key Balance Sheet Changes at June 30, 2009 compared to March 31, 2009
- Net loan balances were essentially flat in the fiscal third quarter of 2009. Residential loans declined $23.0 million, from March 31, 2009 as the Company continued to sell $21.4 million in residential fixed rate conforming loan originations into the secondary market. While loan demand is softer than a year ago due to the economic slowdown, commercial loan originations during the quarter were $92.2 million. In addition, since September credit spreads have improved significantly, a reflection of the withdrawal of many lenders from granting credit facilities in our market. Gross loans totaled $1.71 billion, compared to $1.74 billion at March 31, 2009.
- Securities decreased $58.1 million to $732.1 million, as the Company sold securities with market gains to improve liquidity and capture the appreciation resulting from the Federal Reserve’s efforts to keep mortgage interest rates artificially low and its planned purchase of up to $1.25 trillion in mortgage backed securities.
- Commercial transaction accounts continued to grow, up $31.7 million over the linked quarter. Period-end total deposits decreased $135.8 from March 31, 2009 due to seasonal declines in municipal accounts being offset in part by increases in commercial and retail transaction accounts, retail savings, and retail money market accounts.
Additional Information
- The sharp rise in FDIC insurance premiums during the year has added $2.9 million to the Company’s noninterest expense during fiscal 2009. The FDIC approved a new fee plan on May 22, 2009, which imposed a special assessment on insured banks of 5 basis points of total assets, in addition to regular insurance premiums. This special assessment is reflected fully upon the books of the Company as of June 30, 2009.
- The Company holds $330.1 million in mortgage backed securities issued by FHLMC and FNMA. It also holds private label CMO pass through securities having a fair market value of $10.2 million and an amortized cost basis of $12.1 million all of which were performing at June 30, 2009.
About Provident New York Bancorp
Headquartered in Montebello, New York, Provident New York Bancorp is the parent company of Provident Bank, an independent full-service community bank. Provident Bank operates 33 branches that serve the Hudson Valley region and Bergen County, New Jersey. The Bank offers a complete line of commercial, retail and investment management services. For more information, visit the Company’s web site at www.providentbanking.com.
FORWARD-LOOKING STATEMENTS AND ASSOCIATED RISK FACTORS
In addition to historical information, this earnings release may contain forward-looking statements for purposes of applicable securities laws. Any statements contained herein that are not statements of historical fact may be deemed to be forward-looking statements. Forward-looking statements are subject to numerous assumptions, risks and uncertainties. There are a number of important factors described in documents previously filed by the Company with the Securities and Exchange Commission, and other factors that could cause the Company’s actual results to differ materially from those contemplated by such forward-looking statements. The Company undertakes no obligation to publicly release the results of any revisions to those forward-looking statements which may be made to reflect events or circumstances after the date of this release or to reflect the occurrence of unanticipated events.
Provident New York Bancorp and Subsidiaries
CONSOLIDATED CONDENSED STATEMENTS OF FINANCIAL CONDITION
(unaudited, in thousands, except share and per share data) |
| | | | | | | |
| | | June 30,
2009 | | | September 30,
2008 | | | June 30,
2008 |
| Assets: | | | | | | | | | |
| | | | | | | | | |
| Cash and due from banks | | $ | 96,836 | | | $ | 125,810 | | | $ | 46,208 | |
| Total securities | | | 732,076 | | | | 834,701 | | | | 818,603 | |
| Loans held for sale | | | 891 | | | | 189 | | | | - | |
| Loans: | | | | | | | | | |
| One- to four-family residential mortgage loans | | 473,838 | | | | 513,381 | | | | 510,832 | |
| Commercial real estate, commercial business | | 797,306 | | | | 798,453 | | | | 779,261 | |
| Acquisition,development and construction loans | | 189,920 | | | | 170,979 | | | | 157,306 | |
| Consumer loans | | | 253,365 | | | | 248,740 | | | | 240,452 | |
| Total loans, gross | | | 1,714,429 | | | | 1,731,553 | | | | 1,687,851 | |
| Allowance for loan losses | | | (28,027 | ) | | | (23,101 | ) | | | (22,001 | ) |
| Total loans, net | | | 1,686,402 | | | | 1,708,452 | | | | 1,665,850 | |
| Federal Home Loan Bank stock, at cost | | 23,447 | | | | 28,675 | | | | 31,823 | |
| Premises and equipment, net | | | 40,234 | | | | 36,716 | | | | 34,625 | |
| Goodwill | | | 160,861 | | | | 160,861 | | | | 160,861 | |
| Other amortizable intangibles | | | 6,002 | | | | 7,674 | | | | 8,966 | |
| Bank owned life insurance | | | 49,106 | | | | 47,650 | | | | 47,135 | |
| Other assets | | | 28,501 | | | | 33,643 | | | | 36,483 | |
| Total assets | | $ | 2,824,356 | | | $ | 2,984,371 | | | $ | 2,850,554 | |
| Liabilities: | | | | | | | | | |
| Deposits | | | | | | | | | |
| Retail | | $ | 160,151 | | | $ | 162,161 | | | $ | 167,955 | |
| Commercial | | | 220,260 | | | | 203,682 | | | | 200,237 | |
| Municipal | | | 10,443 | | | | 122,047 | | | | 16,188 | |
| Personal NOW deposits | | | 127,662 | | | | 115,442 | | | | 121,636 | |
| Business NOW deposits | | | 31,311 | | | | 20,881 | | | | 25,176 | |
| Municipal NOW deposits | | | 64,478 | | | | 196,581 | | | | 52,870 | |
| Total transaction accounts | | 614,305 | | | | 820,794 | | | | 584,062 | |
| Savings | | | 369,424 | | | | 335,986 | | | | 351,431 | |
| Money market deposits | | | 383,579 | | | | 306,504 | | | | 300,919 | |
| Certificates of deposit | | | 505,675 | | | | 525,913 | | | | 539,308 | |
| Total deposits | | | 1,872,983 | | | | 1,989,197 | | | | 1,775,720 | |
| Borrowings | | | 436,735 | | | | 566,008 | | | | 635,596 | |
| Borrowings Senior Note | | | 51,493 | | | | - | | | | - | |
| Mortgage escrow funds and other | | 42,370 | | | | 30,008 | | | | 38,097 | |
| Total liabilities | | | 2,403,581 | | | | 2,585,213 | | | | 2,449,413 | |
| Stockholders’ equity | | | 420,775 | | | | 399,158 | | | | 401,141 | |
| Total liabilities and stockholders’ equity | | $ | 2,824,356 | | | $ | 2,984,371 | | | $ | 2,850,554 | |
| | | | | | | | | |
| Shares of common stock outstanding at period end | | 39,613,454 | | | | 39,815,213 | | | | 39,839,335 | |
| Book value per share | | $ | 10.62 | | | $ | 10.03 | | | $ | 10.07 | |
| | | | | | | | | | | | |
Provident New York Bancorp and Subsidiaries
CONSOLIDATED CONDENSED STATEMENTS OF INCOME
(unaudited, in thousands, except share and per share data) |
| | Quarter Ended
June 30, | | Quarter
Ended
Mar 31, | | Nine Months Ended
June 30, |
| | 2009 | | 2008 | | 2009 | | 2009 | | 2008 |
| Interest and dividend income: | | | | | | | | | | |
| Loans and loan fees | | $ | 23,848 | | | $ | 25,630 | | | $ | 23,859 | | | $ | 73,534 | | | $ | 81,101 | |
| Securities taxable | | | 5,460 | | | | 8,048 | | | | 7,533 | | | | 20,886 | | | | 24,058 | |
| Securities non-taxable | | | 1,915 | | | | 1,726 | | | | 1,910 | | | | 5,679 | | | | 5,065 | |
| Other earning assets | | | 428 | | | | 662 | | | | 284 | | | | 1,009 | | | | 2,052 | |
| | | 31,651 | | | | 36,066 | | | | 33,586 | | | | 101,108 | | | | 112,276 | |
| Interest expense: | | | | | | | | | | |
| Deposits | | | 4,104 | | | | 6,187 | | | | 5,274 | | | | 15,185 | | | | 22,895 | |
| Borrowings | | | 4,821 | | | | 5,691 | | | | 4,677 | | | | 14,516 | | | | 19,578 | |
| Total interest expense | | | 8,925 | | | | 11,878 | | | | 9,951 | | | | 29,701 | | | | 42,473 | |
| Net interest income | | | 22,726 | | | | 24,188 | | | | 23,635 | | | | 71,407 | | | | 69,803 | |
| Provision for loan losses | | | 3,500 | | | | 1,400 | | | | 7,100 | | | | 13,100 | | | | 5,100 | |
| Net interest income after provision for loan losses | | | 19,226 | | | | 22,788 | | | | 16,535 | | | | 58,307 | | | | 64,703 | |
| | | | | | | | | | |
| Non-interest income: | | | | | | | | | | |
| Deposit fees and service charges | | | 3,083 | | | | 3,100 | | | | 3,035 | | | | 9,256 | | | | 9,183 | |
| Net gain on sales of securities | | | 10,023 | | | | 22 | | | | 6,093 | | | | 16,447 | | | | 983 | |
| Title insurance fees | | | 254 | | | | 274 | | | | 201 | | | | 667 | | | | 619 | |
| Bank owned life insurance | | | 502 | | | | 455 | | | | 492 | | | | 1,507 | | | | 1,317 | |
| Gain on sale of premises and equipment | | | - | | | | - | | | | - | | | | 517 | | | | - | |
| Gain on sale of loans | | | 450 | | | | - | | | | 290 | | | | 746 | | | | - | |
| Investment management fees | | | 622 | | | | 750 | | | | 599 | | | | 1,829 | | | | 2,242 | |
| Other | | | 321 | | | | 423 | | | | 413 | | | | 1,180 | | | | 1,392 | |
| Total non-interest income | | | 15,255 | | | | 5,024 | | | | 11,123 | | | | 32,149 | | | | 15,736 | |
| | | | | | | | | | |
| Non-interest expense: | | | | | | | | | | |
| Compensation and benefits | | | 10,058 | | | | 9,245 | | | | 9,857 | | | | 29,626 | | | | 26,936 | |
| Stock-based compensation plans | | | 639 | | | | 973 | | | | 825 | | | | 2,321 | | | | 2,893 | |
| Occupancy and office operations | | | 3,310 | | | | 3,090 | | | | 3,218 | | | | 9,607 | | | | 9,309 | |
| Advertising and promotion | | | 614 | | | | 933 | | | | 1,024 | | | | 2,464 | | | | 2,628 | |
| Professional fees | | | 788 | | | | 813 | | | | 876 | | | | 2,370 | | | | 2,588 | |
| Data and check processing | | | 558 | | | | 646 | | | | 598 | | | | 1,721 | | | | 1,913 | |
| Amortization of intangible assets | | | 531 | | | | 636 | | | | 557 | | | | 1,672 | | | | 1,988 | |
| FDIC insurance and regulatory assessments | | | 2,305 | | | | 241 | | | | 769 | | | | 3,505 | | | | 641 | |
| ATM/debit card expense | | | 564 | | | | 456 | | | | 470 | | | | 1,552 | | | | 1,412 | |
| Other | | | 2,150 | | | | 1,922 | | | | 1,882 | | | | 5,990 | | | | 5,693 | |
| Total non-interest expense | | | 21,517 | | | | 18,955 | | | | 20,076 | | | | 60,828 | | | | 56,001 | |
| | | | | | | | | | |
| Income before income tax expense | | | 12,964 | | | | 8,857 | | | | 7,582 | | | | 29,628 | | | | 24,438 | |
| Income tax expense | | | 4,014 | | | | 2,551 | | | | 2,038 | | | | 8,843 | | | | 7,155 | |
| Net income | | $ | 8,950 | | | $ | 6,306 | | | $ | 5,544 | | | $ | 20,785 | | | $ | 17,283 | |
| | | | | | | | | | |
| Per common share: | | | | | | | | | | |
| Basic earnings | | $ | 0.23 | | | $ | 0.16 | | | $ | 0.14 | | | $ | 0.54 | | | $ | 0.44 | |
| Diluted earnings | | | 0.23 | | | | 0.16 | | | | 0.14 | | | | 0.54 | | | | 0.44 | |
| Dividends declared | | | 0.06 | | | | 0.06 | | | | 0.06 | | | | 0.18 | | | | 0.18 | |
| Weighted average common shares: | | | | | | | | | | |
| Basic | | | 38,536,716 | | | | 38,719,917 | | | | 38,627,212 | | | | 38,582,343 | | | | 39,014,150 | |
| Diluted | | | 38,683,135 | | | | 39,110,353 | | | | 38,811,114 | | | | 38,768,486 | | | | 39,402,248 | |
| Selected Financial Condition Data: | | Three Months Ended |
| (in thousands except share and per share data) | | 06/30/09 | | 03/31/09 | | 12/31/08 | | 09/30/08 | | 06/30/08 |
End of Period | | | | | | | | | | |
| Total assets | | $ | 2,824,356 | | | $ | 2,954,701 | | | $ | 2,921,551 | | | $ | 2,984,371 | | | $ | 2,850,554 | |
| Loans, gross (1) | | | 1,714,429 | | | | 1,735,507 | | | | 1,746,605 | | | | 1,731,553 | | | | 1,687,851 | |
| Securities available for sale | | | 689,286 | | | | 739,595 | | | | 795,017 | | | | 791,688 | | | | 777,161 | |
| Securities held to maturity | | | 42,790 | | | | 50,630 | | | | 50,561 | | | | 43,013 | | | | 41,442 | |
| Bank owned life insurance | | | 49,106 | | | | 48,654 | | | | 48,163 | | | | 47,650 | | | | 47,135 | |
| Goodwill | | | 160,861 | | | | 160,861 | | | | 160,861 | | | | 160,861 | | | | 160,861 | |
| Other amortizable intangibles | | | 6,002 | | | | 6,533 | | | | 7,090 | | | | 8,329 | | | | 8,966 | |
| Other non-earning assets | | | 68,735 | | | | 72,843 | | | | 66,072 | | | | 67,318 | | | | 71,108 | |
| Deposits | | | 1,872,983 | | | | 2,008,766 | | | | 1,898,142 | | | | 1,989,197 | | | | 1,775,720 | |
| Borrowings | | | 488,228 | | | | 490,139 | | | | 566,519 | | | | 566,008 | | | | 635,596 | |
| Equity | | | 420,775 | | | | 421,406 | | | | 416,998 | | | | 399,158 | | | | 401,141 | |
Other comprehensive income / (loss) (SFAS 115), reflected in stockholders' equity | | | 1,531 | | | | 6,977 | | | | 6,597 | | | | (5,892 | ) | | | (2,708 | ) |
Average Balances | | | | | | | | | | |
| Total assets | | $ | 2,875,999 | | | $ | 2,961,719 | | | $ | 2,907,948 | | | $ | 2,867,613 | | | $ | 2,822,885 | |
| Loans, gross: | | | | | | | | | | |
| Real estate- residential mortgage | | | 484,276 | | | | 504,406 | | | | 510,386 | | | | 513,016 | | | | 510,383 | |
| Real estate- commercial mortgage | | | 547,846 | | | | 551,011 | | | | 553,483 | | | | 552,930 | | | | 528,308 | |
| Real estate- Acquisition, Development & Construction | | | 190,875 | | | | 185,911 | | | | 176,135 | | | | 159,698 | | | | 150,900 | |
| Commercial and industrial | | | 245,375 | | | | 248,047 | | | | 246,913 | | | | 244,537 | | | | 229,122 | |
| Consumer loans | | | 254,475 | | | | 254,216 | | | | 249,738 | | | | 241,776 | | | | 240,488 | |
| Loans total (1) | | | 1,722,847 | | | | 1,743,591 | | | | 1,736,655 | | | | 1,711,957 | | | | 1,659,201 | |
| Securities (taxable) | | | 520,948 | | | | 623,470 | | | | 647,414 | | | | 629,322 | | | | 653,292 | |
| Securities (non-taxable) | | | 196,385 | | | | 197,786 | | | | 189,316 | | | | 183,115 | | | | 177,933 | |
| Total earning assets | | | 2,549,237 | | | | 2,632,350 | | | | 2,582,405 | | | | 2,535,187 | | | | 2,503,004 | |
| Non earning assets | | | 326,762 | | | | 329,369 | | | | 325,543 | | | | 332,426 | | | | 319,881 | |
| Non-interest bearing checking | | | 373,252 | | | | 365,971 | | | | 380,021 | | | | 379,679 | | | | 357,515 | |
| Interest bearing NOW accounts | | | 227,039 | | | | 241,190 | | | | 231,807 | | | | 198,621 | | | | 189,629 | |
| Total transaction accounts | | | 600,291 | | | | 607,161 | | | | 611,828 | | | | 578,300 | | | | 547,144 | |
| Savings (including mortgage escrow funds) | | | 378,263 | | | | 352,199 | | | | 347,826 | | | | 371,499 | | | | 364,763 | |
| Money market deposits | | | 394,628 | | | | 405,221 | | | | 304,346 | | | | 302,205 | | | | 311,120 | |
| Certificates of deposit | | | 575,713 | | | | 646,527 | | | | 595,595 | | | | 539,269 | | | | 545,413 | |
| Total deposits and mortgage escrow | | | 1,948,895 | | | | 2,011,108 | | | | 1,859,595 | | | | 1,791,273 | | | | 1,768,440 | |
| Total interest bearing deposits | | | 1,575,643 | | | | 1,645,137 | | | | 1,479,574 | | | | 1,411,594 | | | | 1,410,925 | |
| Borrowings | | | 488,846 | | | | 511,340 | | | | 628,988 | | | | 655,281 | | | | 629,325 | |
| Equity | | | 421,529 | | | | 417,652 | | | | 401,104 | | | | 402,314 | | | | 405,692 | |
| Selected Operating Data: | | | | | | | | | | |
Condensed Tax Equivalent Income Statement | | | | | | | | | | |
| Interest and dividend income | | $ | 31,651 | | | $ | 33,586 | | | $ | 35,871 | | | $ | 36,706 | | | $ | 36,066 | |
| Tax equivalent adjustment* | | | 1,031 | | | | 1,029 | | | | 998 | | | | 951 | | | | 929 | |
| Interest expense | | | 8,925 | | | | 9,951 | | | | 10,825 | | | | 11,169 | | | | 11,878 | |
| Net interest income (tax equivalent) | | | 23,757 | | | | 24,664 | | | | 26,044 | | | | 26,488 | | | | 25,117 | |
| Provision for loan losses | | | 3,500 | | | | 7,100 | | | | 2,500 | | | | 2,100 | | | | 1,400 | |
Net interest income after provision for loan losses | | | 20,257 | | | | 17,564 | | | | 23,544 | | | | 24,388 | | | | 23,717 | |
| Non-interest income | | | 15,255 | | | | 11,123 | | | | 5,771 | | | | 5,306 | | | | 5,024 | |
| Non-interest expense | | | 21,517 | | | | 20,076 | | | | 19,235 | | | | 19,499 | | | | 18,955 | |
| Income before income tax expense | | | 13,995 | | | | 8,611 | | | | 10,080 | | | | 10,195 | | | | 9,786 | |
| Income tax expense (tax equivalent)* | | | 5,045 | | | | 3,067 | | | | 3,789 | | | | 3,700 | | | | 3,480 | |
| Net income | | $ | 8,950 | | | $ | 5,544 | | | $ | 6,291 | | | $ | 6,495 | | | $ | 6,306 | |
| (1) Does not reflect allowance for loan losses of $28,027,$26,437, $23,645, $23,101 and $22,001 |
| * Tax exempt income assumed at a 35% federal rate |
| |
| | | Three Months Ended |
| | | 06/30/09 | | | 03/31/09 | | | 12/31/08 | | | 09/30/08 | | | 06/30/08 |
Performance Ratios (annualized) | | | | | | | | | | | | | | | |
| Return on Average Assets | | | 1.25 | % | | | 0.76 | % | | | 0.86 | % | | | 0.90 | % | | | 0.90 | % |
| Return on Average Equity | | | 8.52 | % | | | 5.38 | % | | | 6.22 | % | | | 6.42 | % | | | 6.25 | % |
| Non-Interest Income to Average Assets | | | 2.13 | % | | | 1.52 | % | | | 0.79 | % | | | 0.74 | % | | | 0.72 | % |
| Non-Interest Expense to Average Assets | | | 3.00 | % | | | 2.75 | % | | | 2.62 | % | | | 2.71 | % | | | 2.70 | % |
| Operating Efficiency Adjusted (2) | | | 71.73 | % | | | 65.7 | % | | | 60.2 | % | | | 59.4 | % | | | 60.8 | % |
Analysis of Net Interest Income | | | | | | | | | | | | | | | |
| Yield on: | | | | | | | | | | | | | | | |
| Loans | | | 5.64 | % | | | 5.63 | % | | | 5.98 | % | | | 6.25 | % | | | 6.30 | % |
| Investment Securities- Tax Equivalent | | | 4.70 | % | | | 5.17 | % | | | 5.09 | % | | | 5.19 | % | | | 5.18 | % |
| Earning Assets- Tax Equivalent | | | 5.14 | % | | | 5.33 | % | | | 5.66 | % | | | 5.91 | % | | | 5.94 | % |
| Cost of: | | | | | | | | | | | | | | | |
| Interest Bearing Deposits | | | 1.04 | % | | | 1.30 | % | | | 1.56 | % | | | 1.54 | % | | | 1.76 | % |
| Borrowings | | | 3.96 | % | | | 3.71 | % | | | 3.17 | % | | | 3.47 | % | | | 3.64 | % |
| Interest Bearing Liabilities | | | 1.73 | % | | | 1.87 | % | | | 2.04 | % | | | 2.15 | % | | | 2.34 | % |
| Net Interest Tax Equivalent: | | | | | | | | | | | | | | | |
| Net Interest Rate Spread- Tax Equivalent Basis | | | 3.41 | % | | | 3.46 | % | | | 3.63 | % | | | 3.76 | % | | | 3.60 | % |
| Net Interest Margin- Tax Equivalent Basis | | | 3.74 | % | | | 3.80 | % | | | 4.00 | % | | | 4.16 | % | | | 4.04 | % |
Capital Information Data | | | | | | | | | | | | | | | |
| Tier 1 Leverage Ratio- Bank Only | | | 9.04 | % | | | 8.49 | % | | | 8.32 | % | | | 8.01 | % | | | 8.32 | % |
| Tier 1 Risk-Based Capital- Bank Only | | | 240,392 | | | | 235,902 | | | | 229,395 | | | | 226,053 | | | | 223,391 | |
| Total Risk-Based Capital- Bank Only | | | 264,170 | | | | 259,686 | | | | 253,040 | | | | 249,154 | | | | 245,392 | |
| Tangible Capital Consolidated | | | 253,912 | | | | 254,012 | | | | 249,047 | | | | 229,968 | | | | 231,314 | |
Tangible Capital as a % of Tangible Assets Consolidated | | | 9.55 | % | | | 9.11 | % | | | 9.04 | % | | | 8.17 | % | | | 8.63 | % |
| Shares Outstanding | | | 39,613,454 | | | | 39,876,754 | | | | 39,832,857 | | | | 39,815,213 | | | | 39,839,335 | |
| Shares Repurchased during qrtr(open market) | | | 315,650 | | | | - | | | | 13,301 | | | | 34,122 | | | | 306,443 | |
| Basic weighted common shares outstanding | | | 38,536,716 | | | | 38,627,212 | | | | 38,583,580 | | | | 38,589,361 | | | | 38,719,917 | |
Diluted common shares outstanding | | | 38,683,135 | | | | 38,811,114 | | | | 38,818,569 | | | | 38,893,860 | | | | 39,110,353 | |
| Per Common Share: | | | | | | | | | | | | | | | |
| Basic Earnings | | $ | 0.23 | | | $ | 0.14 | | | $ | 0.16 | | | $ | 0.17 | | | $ | 0.16 | |
| Diluted Earnings | | | 0.23 | | | | 0.14 | | | | 0.16 | | | | 0.17 | | | | 0.16 | |
| Dividends Paid | | | 0.06 | | | | 0.06 | | | | 0.06 | | | | 0.06 | | | | 0.06 | |
| Book Value | | | 10.62 | | | | 10.57 | | | | 10.47 | | | | 10.03 | | | | 10.07 | |
| Tangible Book Value | | | 6.41 | | | | 6.37 | | | | 6.25 | | | | 5.78 | | | | 5.81 | |
Asset Quality Measurements | | | | | | | | | | | | | | | |
| Non-performing loans (NPLs): non-accrual | | $ | 20,600 | | | $ | 21,567 | | | $ | 13,486 | | | $ | 13,589 | | | $ | 9,595 | |
| Non-performing loans (NPLs): still accruing | | | 3,180 | | | | 4,861 | | | | 4,561 | | | | 3,289 | | | | 4,647 | |
| Non-performing assets (NPAs) | | | 25,367 | | | | 28,202 | | | | 19,821 | | | | 16,962 | | | | 14,380 | |
| Net Charge-offs | | | 1,910 | | | | 4,308 | | | | 1,957 | | | | 1,001 | | | | 812 | |
Net Charge-offs as % of average loans (annualized) | | | 0.44 | % | | | 0.99 | % | | | 0.45 | % | | | 0.23 | % | | | 0.20 | % |
| NPLs as % of total loans | | | 1.39 | % | | | 1.52 | % | | | 1.03 | % | | | 0.97 | % | | | 0.84 | % |
| NPAs as % of total assets | | | 0.90 | % | | | 0.95 | % | | | 0.68 | % | | | 0.57 | % | | | 0.50 | % |
| Allowance for loan losses as % of NPLs | | | 118 | % | | | 100 | % | | | 131 | % | | | 137 | % | | | 154 | % |
| Allowance for loan losses as % of total loans | | | 1.63 | % | | | 1.52 | % | | | 1.35 | % | | | 1.33 | % | | | 1.30 | % |
| | | | | | | | | | | | | | | |
(2) The efficiency ratio represents non-interest expense divided by the sum of net interest income and non-interest income. As in the case of net interest income, generally, net interest income as utilized in calculating the efficiency ratio is typically expressed on a tax-equivalent basis. Moreover, most financial institutions, in calculating the efficiency ratio, also adjust both noninterest expense and noninterest income to exclude from these items (as calculated under generally accepted accounting principles) certain component elements, such as non-recurring charges, other real estate expense and amortization of intangibles (deducted from non interest expense) and security transactions and other non-recurring items (excluded from noninterest income). We follow these practices. |
CONTACT:
Provident Bank
Paul A. Maisch, EVP & Chief Financial Officer
Miranda Grimm, VP & Controller
845-369-8040
