Exhibit 99
Provident New York Bancorp Announces First Quarter 2010 Earnings of $0.16 Per Diluted Share
MONTEBELLO, N.Y.--(BUSINESS WIRE)--January 20, 2010--Provident New York Bancorp (NASDAQ-Global Select Market: PBNY), the parent company of Provident Bank, today announced first-quarter results for the fiscal year ending Sept. 30, 2010. Net income for the quarter was $6.2 million, or $0.16 per diluted share, compared to net income of $5.1 million, or $0.13 per diluted share for the linked quarter ended September 30, 2009 and net income of $6.3 million or $0.16 per diluted share for the first quarter of fiscal 2009.
President’s Comments
George Strayton, President and CEO, stated, "I am pleased to report our financial performance for the first quarter of the new fiscal year reflects continued earnings generation, supported by solid performance in our core business, continued realization of securities gains, management of discretionary expenses and fairy stable credit quality indicators. Although commercial loan demand in our legacy markets is soft as compared to last year at the same time we are encouraged by the good results seen from our expansion into Westchester County. Clearly, tax incentives, low interest rates and declining home prices resulted in an increase in home mortgage originations since the last quarter. Although our gross loan balances are down $26 million as compared to September 30, 2009 balances, this reduction is primarily driven by our strategy of selling current production fixed rate, long-term conforming mortgages to the secondary market or securitizing them. We continue to attract commercial transaction accounts, the core of our franchise value, as we focus on developing total banking relationships with our customers."
Key items for the quarter
- Net charge-offs of $2.6 million and non-performing loans at $26.7 million are relatively unchanged from the quarter ending September 30, 2009.
- Average transaction account balances increased to $710.8 million or 12.6 percent compared to quarter ended September 30, 2009 averages.
- Expense control continues to be a key focus of the Company. Non-interest expenses increased 2.8 percent when compared to the previous linked quarter, even though increases were seen in the non-controllable areas of pension plan expense, medical insurance and FDIC assessments.
- Net interest margin, while down over the first quarter of fiscal 2009 is flat when compared to the linked quarter ended September 30, 2009, as the Company continues to reposition its investment portfolio and to deploy excess funds into shorter term investments.
- Securities gains continue to be monetized contributing $2.4 million in non interest income during the first fiscal quarter of 2010, compared to $331,000 and $1.6 million in the first and fourth quarters of fiscal 2009.
- The Company announced an additional authorization of 2,000,000 shares to its stock repurchase program. During the quarter the Company repurchased 602,200 shares at a cost of $5.1 million. The remaining shares authorized to be repurchased under the August 2007 and December 2009 plans are 2,147,890 shares.
Credit Quality
Net charge-offs for the quarter were $2.6 million compared to $2.5 million last quarter and $2.0 million during the first fiscal quarter of 2009. Charge-off’s continue to be concentrated in the community business loan portfolio, which accounted for net charge off’s of $1.6 million on average outstandings of $99.4 million.
Substandard loans at December 31, 2009 were $100.5 million compared to $89.9 million at September 30, 2009, while special mention loans were $48.1 million and $47.8 million, respectively. Non-performing loans, however, remained approximately flat at $26.7 million compared to $26.5 million at September 30, 2009, while non performing assets went from $28.9 million to $29.4 million for the same period.
We continue to actively review our loan portfolio and work with our borrowers. Based on our analysis we have added $2.5 million to our allowance for loan loss and after recording $2.6 million in net charge offs this quarter our allowance for loan losses remained at $30.0 million, or 112 percent of non performing loans. This compares to 114 percent at September 30, 2009.
The table below outlines non-performing assets at December 31, 2009, by category with the related weighted loan to value ratios and specific reserves against such loans:
| | |
| | WLTV after |
| | | Book | | | | | Specific | | Specific |
| Loans with Specific Reserves | | | Value | | WLTV* | | Reserve | | Reserve |
| ADC | | | $ | 2,175,315 | | 86 | % | | $ | 1,088,727 | | 66 | % |
| Commercial mortgage | | | | 1,502,764 | | 103 | | | | 454,426 | | 67 | |
| Residential mortgage | | | | 2,979,998 | | 93 | | | | 549,045 | | 71 | |
| | | | | | | | | | | | | |
| Loans with out Specific Reserves | | | | | | | | | | | | | |
| ADC | | | | 8,340,644 | | 69 | | | | - | | 69 | |
| Commercial mortgage | | | | 5,385,392 | | 69 | | | | - | | 69 | |
| Residential Mortgage | | | | 4,818,729 | | 69 | | | | - | | 69 | |
| Total Mortgage secured | | | | 25,202,842 | | 75 | | | | 2,092,198 | | 69 | |
| | | | | | | | | | | | | |
| Loans not Mortgage Secured | | | | | | | | | | | | | |
| Loans with specific reserves | | | | 577,002 | | | | | | 319,162 | | | |
| Loans without specific reserves | | | | 914,155 | | | | | | - | | | |
| Total non-performing loans | | | | 26,693,999 | | | | | | 2,411,360 | | | |
| General reserves | | | | | | | | | | 27,555,640 | | | |
| Troubled Debt Restructures | | | | 419,168 | | | | | | | | | |
| Total allowance for loan losses | | | | | | | | | | $ 29,967,000 | | | |
| ORE balance | | | | 2,332,113 | | | | | | | | | |
| Total non-performing assets | | | $ | 29,445,280 | | | | | | | | | |
| | | | | | | | | | | | | |
*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.
Net Interest Income and Margin
First quarter fiscal 2010 compared with first quarter fiscal 2009
Net interest income was $22.9 million for the first quarter of fiscal 2010, a $2.2 million decrease from the same quarter of fiscal 2009. The net interest margin on a tax-equivalent basis was 3.70 percent for the first quarter of fiscal 2010, compared to 4.0 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 175 basis points in the quarter ending December 31, 2008, as well as the repositioning of the investment portfolio. The tax-equivalent yield on investments decreased 142 basis points compared to the first fiscal quarter in 2009. As a result, the yield on interest-earning assets declined 80 basis points. For the same period, the cost of interest-bearing deposits decreased 84 basis points to 0.72 percent, and the cost of borrowings increased 70 basis points to 3.87 percent, reflecting the carry cost of term borrowings outstanding and repayment of short-term borrowings.
First quarter fiscal 2010 compared with linked quarter ended September 30, 2009
Net interest income for the quarter ended December 31, 2009, increased to $22.9 million from $22.5 million at quarter ended September 30, 2009. The tax-equivalent net interest margin decreased 1 basis point from 3.71 percent for the same period. During the quarter the Bank sold $136.8 million in securities and purchased $246.4 million. The overall yield of the investment portfolio and other earning assets declined 11 basis points during the first quarter, while interest bearing deposit costs declined 12 basis points.
Noninterest Income
First quarter fiscal 2010 compared with first quarter fiscal 2009
Noninterest income totaled $8.1 million for the fiscal first quarter, an increase of $2.3 million from $5.8 million in the first quarter of fiscal 2009. The increase was due to gains of $2.4 million resulting from the Company’s decision to realize a portion of the recent appreciation in its securities portfolio, monetizing other comprehensive income and reducing prepayment risk. Other factors contributing to the increase were gains on the sale of $15.5 million of loans with gains of $283,000. The Bank has been selling current production of conforming fixed rate residential mortgage loans in the secondary market to control interest rate risk. A fair value gain of $380,000 on interest rate caps that the Company purchased in the first quarter of fiscal 2010 was recorded. These increases were offset by a gain recorded on sales of premises in the first quarter of fiscal 2009.
First quarter fiscal 2010 compared with linked quarter ended September 30, 2009
Noninterest income increased on a linked-quarter basis, due to higher levels of securities gains realized and the aforementioned interest rate cap fair value adjustment, partially offset by a death payment received from Bank Owned Life Insurance in the fourth quarter of 2009.
Noninterest Expense
First quarter fiscal 2010 compared with first quarter fiscal 2009
The Company remained focused on controlling operating expenses, and as a result, non interest expense remained relatively unchanged increasing $659,000 when compared to the first quarter fiscal 2009. The increase is due primarily to increased medical and pension expense, FDIC insurance and occupancy expense. Occupancy expense increased due primarily to maintenance expense on buildings and equipment.
First quarter fiscal 2010 compared with linked quarter ended September 30, 2009
On a quarter-to-quarter basis, non-interest expense increased due to the expenses related to occupancy and employee benefits.
Income Taxes
The Company’s effective tax rate was 28.2 percent for the first quarter of fiscal 2010 and 30.7 percent for the first quarter of fiscal 2009. For the linked quarter ended September 30, 2009, the Company’s effective tax rate was 20.8 percent due to a BOLI payment received during that quarter.
Key Balance Sheet Changes at December 31, 2009 compared to September 30, 2009
- Period-end total deposits decreased $212.6 million from September 30, 2009, as municipal tax deposits of $201 million as of year end were utilized by the individual municipalities. Commercial and retail transaction accounts continued to grow. Savings accounts increased $11.6 million and certificates of deposits decreased $48.0 million. While loan demand is softer than a year ago due to the economic slowdown, commercial loan originations during the first quarter were $61.1 million, an increase of 2 percent over the first quarter of 2009. Residential originations were $19.4 million, an increase of 64 percent over 2009 levels. However, gross loan balances decreased by $26.2 million as fixed rate conforming residential loans sold into the secondary market totaled $15.5 million during the first quarter of fiscal 2010 and commercial loan repayments exceeded originations. Net loans totaled $1.65 billion, compared to $1.67 billion at September 30, 2009.
- Securities increased $20.3 million to $897.5 million, as the Company invested excess cash.
- Borrowings increased over September 30, 2009 levels as the Company began to utilize its overnight borrowing line with the FHLBNY, offsetting a portion of the municipal tax deposit withdrawals subsequent to September 30, 2009.
Capital and Liquidity
Provident Bank remained well-capitalized with excellent liquidity in the first quarter, as it continued to hold strong capital, with the Bank’s Tier 1 leverage ratio at 8.85 percent. The Company’s tangible capital as a percent of tangible assets increased to 9.25 percent as of December 31, 2009, while its tangible book value per share decreased to $6.51 from $6.60 at September 30, 2009 due to the effect of treasury repurchases and the change in other comprehensive income. Total capital decreased $7.1 million from September 30, 2009, to $420.3 million at December 31, 2009, due to a $3.8 million increase in the Company’s retained earnings and a $6.9 million decrease in accumulated other comprehensive income, including realizing securities gains in the fiscal year of $2.4 million. The Company repurchased 602,200 common shares, at a cost of $5.1 million during the quarter. On December 21, 2009 the Board of Directors approved a fifth stock repurchase program.
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. The Bank offers a complete line of commercial, retail and investment management services. For more information, visit the Company’s web site at www.providentbanking.com.
FORWARD-LOOKING STATEMENTS AND ASSOCIATED RISK FACTORS
In addition to historical information, this earnings release may contain forward-looking statements for purposes of applicable securities laws. Any statements contained herein that are not statements of historical fact may be deemed to be forward-looking statements. Forward-looking statements are subject to numerous assumptions, risks and uncertainties. There are a number of important factors described in documents previously filed by the Company with the Securities and Exchange Commission, and other factors that could cause the Company’s actual results to differ materially from those contemplated by such forward-looking statements. The Company undertakes no obligation to publicly release the results of any revisions to those forward-looking statements which may be made to reflect events or circumstances after the date of this release or to reflect the occurrence of unanticipated events.
Financial information contained in this release should be considered to be an estimate pending the filing of the Company's Quarterly Report on Form 10-Q for the quarter ended December 31, 2009 with the Securities and Exchange Commission. While the Company is not aware of any need to revise the results disclosed in this release, accounting literature may require adverse information received by management between the date of this release and the filing of the 10-Q to be reflected in the results of the fiscal quarter, even though the new information was received by management subsequent to the date of this release.
| |
| Provident New York Bancorp and Subsidiaries |
| CONSOLIDATED CONDENSED STATEMENTS OF FINANCIAL CONDITION |
| (unaudited, in thousands, except share and per share data) |
| | | | | | | | |
| | | | December 31, | | | | September 30, |
| | | | 2009 | | | | 2009 |
| Assets: | | | | | | | | |
| Cash and due from banks | | | $ | 39,819 | | | | $ | 160,408 | |
| Total securities | | | | 897,529 | | | | | 877,197 | |
| Loans held for sale | | | | 1,298 | | | | | 1,213 | |
| Loans: | | | | | | | | |
| One- to four-family residential mortgage loans | | | | 443,031 | | | | | 460,728 | |
| Commercial real estate, commercial business | | | | 777,760 | | | | | 789,396 | |
| Acquisition, development and construction loans | | | | 208,159 | | | | | 201,611 | |
| Consumer loans | | | | 248,082 | | | | | 251,522 | |
| Total loans, gross | | | | 1,677,032 | | | | | 1,703,257 | |
| Allowance for loan losses | | | | (29,967 | ) | | | | (30,050 | ) |
| Total loans, net | | | | 1,647,065 | | | | | 1,673,207 | |
| Federal Home Loan Bank stock, at cost | | | | 27,797 | | | | | 23,177 | |
| Premises and equipment, net | | | | 40,985 | | | | | 40,692 | |
| Goodwill | | | | 160,861 | | | | | 160,861 | |
| Other amortizable intangibles | | | | 4,996 | | | | | 5,489 | |
| Bank owned life insurance | | | | 49,448 | | | | | 49,611 | |
| Other assets | | | | 47,991 | | | | | 30,038 | |
| Total assets | | | $ | 2,917,789 | | | | $ | 3,021,893 | |
| Liabilities: | | | | | | | | |
| Deposits | | | | | | | | |
| Retail | | | $ | 166,905 | | | | $ | 169,122 | |
| Commercial | | | | 243,127 | | | | | 236,516 | |
| Municipal | | | | 7,794 | | | | | 86,596 | |
| Personal NOW deposits | | | | 137,113 | | | | | 127,595 | |
| Business NOW deposits | | | | 34,672 | | | | | 36,972 | |
| Municipal NOW deposits | | | | 91,399 | | | | | 188,074 | |
| Total transaction accounts | | | | 681,010 | | | | | 844,875 | |
| Savings | | | | 369,463 | | | | | 357,814 | |
| Money market deposits | | | | 372,159 | | | | | 384,632 | |
| Certificates of deposit | | | | 447,011 | | | | | 494,961 | |
| Total deposits | | | | 1,869,643 | | | | | 2,082,282 | |
| Borrowings | | | | 533,222 | | | | | 430,628 | |
| Borrowings Senior Note | | | | 51,495 | | | | | 51,494 | |
| Mortgage escrow funds and other | | | | 43,103 | | | | | 30,033 | |
| Total liabilities | | | | 2,497,463 | | | | | 2,594,437 | |
| Stockholders’ equity | | | | 420,326 | | | | | 427,456 | |
| Total liabilities and stockholders’ equity | | | $ | 2,917,789 | | | | $ | 3,021,893 | |
| | | | | | | | |
| Shares of common stock outstanding at period end | | | | 39,061,035 | | | | | 39,547,207 | |
| Book value per share | | | $ | 10.76 | | | | $ | 10.81 | |
| | | | | |
| Provident New York Bancorp and Subsidiaries |
| CONSOLIDATED CONDENSED STATEMENTS OF INCOME |
| (unaudited, in thousands, except share and per share data) |
| | | | | | | | |
| | | | | | | | Quarter |
| | | Quarter Ended | | | Ended |
| | | December 31, | | September 30, |
| | | 2009 | | 2008 | | | 2009 |
| Interest and dividend income: | | | | | | | | |
| Loans and loan fees | | | $ | 23,400 | | | $ | 25,827 | | | $ | 23,615 |
| Securities taxable | | | | 4,752 | | | | 7,893 | | | | 4,666 |
| Securities non-taxable | | | | 1,895 | | | | 1,854 | | | | 1,841 |
| Other earning assets | | | | 371 | | | | 297 | | | | 360 |
| | | | 30,418 | | | | 35,871 | | | | 30,482 |
| Interest expense: | | | | | | | | |
| Deposits | | | | 2,790 | | | | 5,807 | | | | 3,190 |
| Borrowings | | | | 4,742 | | | | 5,018 | | | | 4,829 |
| Total interest expense | | | | 7,532 | | | | 10,825 | | | | 8,019 |
| Net interest income | | | | 22,886 | | | | 25,046 | | | | 22,463 |
| Provision for loan losses | | | | 2,500 | | | | 2,500 | | | | 4,500 |
| Net interest income after provision for loan losses | | | | 20,386 | | | | 22,546 | | | | 17,963 |
| | | | | | | | |
| Non-interest income: | | | | | | | | |
| Deposit fees and service charges | | | | 2,993 | | | | 3,138 | | | | 3,137 |
| Net gain on sales of securities | | | | 2,388 | | | | 331 | | | | 1,630 |
| Title insurance fees | | | | 311 | | | | 212 | | | | 337 |
| Bank owned life insurance | | | | 554 | | | | 513 | | | | 1,248 |
| Gain on sale of premises and equipment | | | | (44 | ) | | | 517 | | | | - |
| Gain on sale of loans | | | | 283 | | | | 6 | | | | 215 |
| Investment management fees | | | | 779 | | | | 608 | | | | 747 |
| Fair value gain interest rate caps | | | | 380 | | | | - | | | | - |
| Other | | | | 449 | | | | 446 | | | | 490 |
| Total non-interest income | | | | 8,093 | | | | 5,771 | | | | 7,804 |
| | | | | | | | |
| Non-interest expense: | | | | | | | | |
| Compensation and benefits | | | | 10,264 | | | | 9,711 | | | | 9,894 |
| Stock-based compensation plans | | | | 452 | | | | 857 | | | | 621 |
| Occupancy and office operations | | | | 3,326 | | | | 3,079 | | | | 3,195 |
| Advertising and promotion | | | | 742 | | | | 826 | | | | 629 |
| Professional fees | | | | 834 | | | | 706 | | | | 720 |
| Data and check processing | | | | 550 | | | | 565 | | | | 563 |
| Amortization of intangible assets | | | | 493 | | | | 584 | | | | 513 |
| FDIC insurance and regulatory assessments | | | | 784 | | | | 431 | | | | 752 |
| ATM/debit card expense | | | | 554 | | | | 518 | | | | 563 |
| Other | | | | 1,895 | | | | 1,958 | | | | 1,909 |
| Total non-interest expense | | | | 19,894 | | | | 19,235 | | | | 19,359 |
| | | | | | | | |
| Income before income tax expense | | | | 8,585 | | | | 9,082 | | | | 6,408 |
| Income tax expense | | | | 2,419 | | | | 2,791 | | | | 1,332 |
| Net income | | | $ | 6,166 | | | $ | 6,291 | | | $ | 5,076 |
| | | | | | | | |
| Per common share: | | | | | | | | |
| Basic earnings | | | $ | 0.16 | | | $ | 0.16 | | | $ | 0.13 |
| Diluted earnings | | | | 0.16 | | | | 0.16 | | | | 0.13 |
| Dividends declared | | | | 0.06 | | | | 0.06 | | | | 0.06 |
| Weighted average common shares: | | | | | | | | |
| Basic | | | | 38,575,909 | | | | 38,583,580 | | | | 38,405,947 |
| Diluted | | | | 38,649,174 | | | | 38,818,569 | | | | 38,532,411 |
| | | | |
| Selected Financial Condition Data: | | | Three Months Ended | |
| (in thousands except share and per share data) | | | 12/31/09 | | 09/30/09 | | 06/30/09 | | 03/31/09 | | 12/31/08 | |
End of Period | | | | | | | | | | | | |
| Total assets | | | $ | 2,917,789 | | $ | 3,021,893 | | $ | 2,824,356 | | $ | 2,954,701 | | $ | 2,921,551 | |
| Loans, gross (1) | | | | 1,677,032 | | | 1,703,257 | | | 1,714,429 | | | 1,735,507 | | | 1,746,605 | |
| Securities available for sale | | | | 851,028 | | | 832,583 | | | 689,286 | | | 739,595 | | | 795,017 | |
| Securities held to maturity | | | | 46,500 | | | 44,614 | | | 42,790 | | | 50,630 | | | 50,561 | |
| Bank owned life insurance | | | | 49,448 | | | 49,611 | | | 49,106 | | | 48,654 | | | 48,163 | |
| Goodwill | | | | 160,861 | | | 160,861 | | | 160,861 | | | 160,861 | | | 160,861 | |
| Other amortizable intangibles | | | | 4,996 | | | 5,489 | | | 6,002 | | | 6,533 | | | 7,090 | |
| Other non-earning assets | | | | 88,976 | | | 70,730 | | | 68,735 | | | 72,843 | | | 66,072 | |
| Deposits | | | | 1,869,643 | | | 2,082,282 | | | 1,872,983 | | | 2,008,766 | | | 1,898,142 | |
| Borrowings | | | | 584,717 | | | 482,122 | | | 488,228 | | | 490,139 | | | 566,519 | |
| Equity | | | | | 420,326 | | | 427,456 | | | 420,775 | | | 421,406 | | | 416,998 | |
| Other comprehensive income / (loss) related to investment, | | | | | | | | | | | | |
| securities reflected in stockholders' equity | | | | 2,342 | | | 9,502 | | | 1,531 | | | 6,977 | | | 6,597 | |
Average Balances | | | | | | | | | | | | |
| Total assets | | | $ | 2,886,880 | | $ | 2,837,511 | | $ | 2,875,999 | | $ | 2,961,719 | | $ | 2,907,948 | |
| Loans, gross: | | | | | | | | | | | | |
| Real estate- residential mortgage | | | | 451,894 | | | 465,472 | | | 484,276 | | | 504,406 | | | 510,386 | |
| Real estate- commercial mortgage | | | | 538,646 | | | 548,195 | | | 547,846 | | | 551,011 | | | 553,483 | |
| Real estate- Acquisition, Development & Construction | | | | 202,864 | | | 191,826 | | | 190,875 | | | 185,911 | | | 176,135 | |
| Commercial and industrial | | | | 239,698 | | | 246,590 | | | 245,375 | | | 248,047 | | | 246,913 | |
| Consumer loans | | | | 252,354 | | | 252,667 | | | 254,475 | | | 254,216 | | | 249,738 | |
| Loans total (1) | | | | 1,685,456 | | | 1,704,750 | | | 1,722,847 | | | 1,743,591 | | | 1,736,655 | |
| Securities (taxable) | | | | 626,734 | | | 576,363 | | | 520,948 | | | 623,470 | | | 647,414 | |
| Securities (non-taxable) | | | | 201,706 | | | 192,733 | | | 196,385 | | | 197,786 | | | 189,316 | |
| Total earning assets | | | | 2,563,965 | | | 2,511,431 | | | 2,549,237 | | | 2,632,350 | | | 2,582,405 | |
| Non earning assets | | | | 322,915 | | | 326,080 | | | 326,762 | | | 329,369 | | | 325,543 | |
| Non-interest bearing checking | | | | 418,961 | | | 402,643 | | | 373,252 | | | 365,971 | | | 380,021 | |
| Interest bearing NOW accounts | | | | 291,844 | | | 228,761 | | | 227,039 | | | 241,190 | | | 231,807 | |
| Total transaction accounts | | | | 710,805 | | | 631,404 | | | 600,291 | | | 607,161 | | | 611,828 | |
| Savings (including mortgage escrow funds) | | | | 372,911 | | | 386,943 | | | 378,263 | | | 352,199 | | | 347,826 | |
| Money market deposits | | | | 397,710 | | | 394,718 | | | 394,628 | | | 405,221 | | | 304,346 | |
| Certificates of deposit | | | | 477,377 | | | 494,530 | | | 575,713 | | | 646,527 | | | 595,595 | |
| Total deposits and mortgage escrow | | | | 1,958,803 | | | 1,907,595 | | | 1,948,895 | | | 2,011,108 | | | 1,859,595 | |
| Total interest bearing deposits | | | | 1,539,842 | | | 1,504,952 | | | 1,575,643 | | | 1,645,137 | | | 1,479,574 | |
| Borrowings | | | | 485,759 | | | 488,443 | | | 488,846 | | | 511,340 | | | 628,988 | |
| Equity | | | | | 424,338 | | | 423,361 | | | 421,529 | | | 417,652 | | | 401,104 | |
| Selected Operating Data: | | | | | | | | | | | | |
Condensed Tax Equivalent Income Statement | | | | | | | | | | | | |
| Interest and dividend income | | | $ | 30,418 | | $ | 30,482 | | $ | 31,651 | | $ | 33,586 | | $ | 35,871 | |
| Tax equivalent adjustment* | | | | 1,020 | | | 991 | | | 1,031 | | | 1,029 | | | 998 | |
| Interest expense | | | | 7,532 | | | 8,019 | | | 8,925 | | | 9,951 | | | 10,825 | |
| Net interest income (tax equivalent) | | | | 23,906 | | | 23,454 | | | 23,757 | | | 24,664 | | | 26,044 | |
| Provision for loan losses | | | | 2,500 | | | 4,500 | | | 3,500 | | | 7,100 | | | 2,500 | |
| Net interest income after provision for loan | | | | | | | | | | | | |
| losses | | | | 21,406 | | | 18,954 | | | 20,257 | | | 17,564 | | | 23,544 | |
| Non-interest income | | | | 8,093 | | | 7,804 | | | 15,255 | | | 11,123 | | | 5,771 | |
| Non-interest expense | | | | 19,894 | | | 19,359 | | | 21,517 | | | 20,076 | | | 19,235 | |
| Income before income tax expense | | | | 9,605 | | | 7,399 | | | 13,995 | | | 8,611 | | | 10,080 | |
| Income tax expense (tax equivalent)* | | | | 3,439 | | | 2,323 | | | 5,045 | | | 3,067 | | | 3,789 | |
| Net income | | | $ | 6,166 | | $ | 5,076 | | $ | 8,950 | | $ | 5,544 | | $ | 6,291 | |
| |
| (1) Does not reflect allowance for loan losses of $29,967, $30,050, $28,027, $26,437 and $23,645 | |
| * Tax exempt income assumed at a 35% federal rate | |
| | | | | | | | | | | | |
| | | Three Months Ended |
| | | 12/31/09 | | | 09/30/09 | | | 06/30/09 | | | 03/31/09 | | | 12/31/08 |
Performance Ratios (annualized) | | | | | | | | | | | | | | | |
| Return on Average Assets | | | 0.85 | % | | | 0.71 | % | | | 1.25 | % | | | 0.76 | % | | | 0.86 | % |
| Return on Average Equity | | | 5.76 | % | | | 4.76 | % | | | 8.52 | % | | | 5.38 | % | | | 6.22 | % |
| Non-Interest Income to Average Assets | | | 1.11 | % | | | 1.09 | % | | | 2.13 | % | | | 1.52 | % | | | 0.79 | % |
| Non-Interest Expense to Average Assets | | | 2.73 | % | | | 2.71 | % | | | 3.00 | % | | | 2.75 | % | | | 2.62 | % |
| Operating Efficiency Adjusted (2) | | | 65.40 | % | | | 63.59 | % | | | 71.73 | % | | | 65.7 | % | | | 60.2 | % |
Analysis of Net Interest Income | | | | | | | | | | | | | | | |
| Yield on Loans | | | 5.61 | % | | | 5.59 | % | | | 5.64 | % | | | 5.63 | % | | | 5.98 | % |
| Yield on Investment Securities- Tax Equivalent | | | 3.67 | % | | | 3.87 | % | | | 4.70 | % | | | 5.17 | % | | | 5.09 | % |
| Yield on Earning Assets- Tax Equivalent | | | 4.86 | % | | | 4.97 | % | | | 5.14 | % | | | 5.33 | % | | | 5.66 | % |
| Cost of Interest Bearing Deposits | | | 0.72 | % | | | 0.84 | % | | | 1.04 | % | | | 1.30 | % | | | 1.56 | % |
| Cost of Borrowings | | | 3.87 | % | | | 3.92 | % | | | 3.96 | % | | | 3.71 | % | | | 3.17 | % |
| Cost of Interest Bearing Liabilities | | | 1.48 | % | | | 1.60 | % | | | 1.73 | % | | | 1.87 | % | | | 2.04 | % |
| Net Interest Rate Spread- Tax Equivalent Basis | | | 3.39 | % | | | 3.38 | % | | | 3.41 | % | | | 3.46 | % | | | 3.63 | % |
| Net Interest Margin- Tax Equivalent Basis | | | 3.70 | % | | | 3.71 | % | | | 3.74 | % | | | 3.80 | % | | | 4.00 | % |
Capital Information Data | | | | | | | | | | | | | | | |
| Tier 1 Leverage Ratio- Bank Only | | | 8.85 | % | | | 8.64 | % | | | 9.04 | % | | | 8.49 | % | | | 8.32 | % |
| Tier 1 Risk-Based Capital- Bank Only | | | 243,968 | | | | 246,339 | | | | 240,392 | | | | 235,902 | | | | 229,395 | |
| Total Risk-Based Capital- Bank Only | | | 268,489 | | | | 270,807 | | | | 264,076 | | | | 259,686 | | | | 253,040 | |
| Tangible Capital Consolidated (3) | | | 254,469 | | | | 261,106 | | | | 253,912 | | | | 254,012 | | | | 249,047 | |
| Tangible Capital as a % of Tangible Assets Consolidated (3) | | | 9.25 | % | | | 9.14 | % | | | 9.55 | % | | | 9.11 | % | | | 9.04 | % |
| Shares Outstanding | | | 39,061,035 | | | | 39,547,207 | | | | 39,613,454 | | | | 39,876,754 | | | | 39,832,857 | |
| Shares Repurchased during qrtr(open market) | | | 602,200 | | | | 86,860 | | | | 315,650 | | | | - | | | | 13,301 | |
| Basic weighted common shares outstanding | | | 38,575,909 | | | | 38,405,947 | | | | 38,536,716 | | | | 38,627,212 | | | | 38,583,580 | |
| Diluted common shares outstanding | | | 38,649,174 | | | | 38,532,411 | | | | 38,683,135 | | | | 38,811,114 | | | | 38,818,569 | |
| Basic Earnings per common share | | $ | 0.16 | | | | 0.13 | | | | 0.23 | | | $ | 0.14 | | | $ | 0.16 | |
| Diluted Earnings per common share | | | 0.16 | | | | 0.13 | | | | 0.23 | | | | 0.14 | | | | 0.16 | |
| Dividends Paid per common share | | | 0.06 | | | | 0.06 | | | | 0.06 | | | | 0.06 | | | | 0.06 | |
| Book Value per common share | | | 10.76 | | | | 10.81 | | | | 10.62 | | | | 10.57 | | | | 10.47 | |
| Tangible Book Value per common share (3) | | | 6.51 | | | | 6.60 | | | | 6.41 | | | | 6.37 | | | | 6.25 | |
Asset Quality Measurements | | | | | | | | | | | | | | | |
| Non-performing loans (NPLs): non-accrual | | $ | 21,432 | | | | 21,909 | | | | 20,600 | | | $ | 21,567 | | | $ | 13,486 | |
| Non-performing loans (NPLs): still accruing | | | 5,262 | | | | 4,560 | | | | 3,180 | | | | 4,861 | | | | 4,561 | |
| Troubled Debt Restructures | | | 419 | | | | 674 | | | | 1,199 | | | | 0 | | | | 0 | |
| Non-performing assets (NPAs) | | | 29,445 | | | | 28,855 | | | | 26,566 | | | | 28,202 | | | | 19,821 | |
| Net Charge-offs | | | 2,583 | | | | 2,477 | | | | 1,910 | | | | 4,308 | | | | 1,957 | |
| Net Charge-offs as % of average loans (annualized) | | | 0.61 | % | | | 0.58 | % | | | 0.44 | % | | | 0.99 | % | | | 0.45 | % |
| NPLs as % of total loans | | | 1.59 | % | | | 1.55 | % | | | 1.39 | % | | | 1.52 | % | | | 1.03 | % |
| NPAs as % of total assets | | | 1.01 | % | | | 0.95 | % | | | 0.90 | % | | | 0.95 | % | | | 0.68 | % |
| Allowance for loan losses as % of NPLs | | | 112 | % | | | 114 | % | | | 118 | % | | | 100 | % | | | 131 | % |
| Allowance for loan losses as % of total loans | | | 1.79 | % | | | 1.76 | % | | | 1.63 | % | | | 1.52 | % | | | 1.35 | % |
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(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 non interest income). We follow these practices. |
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(3) Provident Bank provides supplemental reporting of Non-GAAP tangible equity ratios as management believes this information is useful to investors. The following table shows the reconciliation of tangible equity and the tangible equity ratio: |
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| | | 12/31/09 | | | 09/30/09 | | | 06/30/09 | | | 03/31/09 | | | 12/31/08 |
| Total Assets | | $ | 2,917,789 | | | $ | 3,021,893 | | | $ | 2,824,356 | | | $ | 2,954,701 | | | $ | 2,921,551 | |
| Goodwill and other amortizable intangibles | | | (165,857 | ) | | | (166,350 | ) | | | (166,863 | ) | | | (167,394 | ) | | | (167,951 | ) |
| Tangible Assets | | $ | 2,751,932 | | | $ | 2,855,543 | | | $ | 2,657,493 | | | $ | 2,787,307 | | | $ | 2,753,600 | |
| Stockholders' equity | | | 420,326 | | | | 427,456 | | | | 420,775 | | | | 421,406 | | | | 416,998 | |
| Goodwill and other amortizable intangibles | | | (165,857 | ) | | | (166,350 | ) | | | (166,863 | ) | | | (167,394 | ) | | | (167,951 | ) |
| Tangible Stockholders' equity | | $ | 254,469 | | | $ | 261,106 | | | $ | 253,912 | | | $ | 254,012 | | | $ | 249,047 | |
| Outstanding Shares | | | 39,061,035 | | | | 39,547,207 | | | | 39,613,454 | | | | 39,876,754 | | | | 39,832,857 | |
| Tangible capital as a % of tangible assets (consolidated) | | | 9.25 | % | | | 9.14 | % | | | 9.55 | % | | | 9.11 | % | | | 9.04 | % |
| Tangible book value per share | | $ | 6.51 | | | $ | 6.60 | | | $ | 6.41 | | | $ | 6.37 | | | $ | 6.25 | |
CONTACT:
Provident Bank:
Paul A. Maisch, EVP & Chief Financial Officer
Miranda Grimm, VP & Controller
845-369-8040
