Exhibit 99.1
WILSHIRE BANCORP, INC.CONTACT: Joanne Kim, President & CEO, (213) 639-1843 Alex Ko, EVP & CFO, (213) 427-6560 www.wilshirebank.com | 
| NEWS RELEASE |
Wilshire Bancorp Reports Net Income of
$2.4 Million, or $0.08 Per Common Share, for the First Quarter of 2010
LOS ANGELES, April 22, 2010 - Wilshire Bancorp, Inc. (NASDAQ: WIBC), the holding company for Wilshire State Bank, today reported net income available to common shareholders of $2.4 million, or $0.08 per basic and diluted common share, for the first quarter of 2010. This compares to net income of $2.1 million, or $0.07 per basic and diluted share, for the same period of the prior year.
“We are pleased to report that Wilshire continues to perform profitably in the face of challenging economic conditions,” said Ms. Joanne Kim, President and CEO of Wilshire Bancorp. “We are not, however, impervious to economic conditions, as evidenced by an increase in our non-accrual loans during the first quarter. We responded to this increase by significantly strengthening our allowance for loan losses. The strong core earnings power of the Company enabled us to absorb these credit costs while still generating a profit for our shareholders. We continue to experience strong core deposit growth, which has improved our deposit mix and lowered our overall cost of funds. We believe that our increasing deposit base and continued strong capital ratios provide us with an excellent foundation for effectively managing our business through this challenging economic environment.”
FIRST QUARTER 2010 SUMMARY:
· Strong core deposit growth — Core deposits increased to $2.18 billion at March 31, 2010, a 7.2% increase from $2.03 billion at December 31, 2009.
· Declining cost of deposits — Cost of deposits decreased to 1.55% in the first quarter of 2010, from 1.83% in the fourth quarter of 2009.
· Declining non-interest expense — Non-interest expense decreased by 10.9% to $14.7 million at March 31, 2010, compared to $16.5 million in the previous quarter.
· Increase in non-accrual loans — Non-accrual loans increased to $105.0 million, or 4.34% of total loans, at March 31, 2010, compared to $69.4 million, or 2.86% of total loans, at December 31, 2009.
· Decrease in delinquencies and troubled debt restructured (“TDR”) Loans — Delinquencies decreased from $40.6 million to $30.5 million from December 31, 2009 to March 31, 2010, and TDRs were reduced from $64.6 million to $54.6 million for the same period.
· Allowance for loan losses — The allowance for loan losses as a percentage of total loans was strengthened to 3.29% at March 31, 2010, from 2.56% at December 31, 2009.
· Strong capital position — Total risk-based capital ratio remained strong at 15.95% as of March 31, 2010, compared to 15.81% at December 31, 2009. Tangible common equity per common share was $6.85 at March 31, 2010, an increase from $6.71 at December 31, 2009.
CREDIT QUALITY
During the first quarter of 2010, the Company continued to record a provision for loan losses in excess of net charge-offs. The provision for losses on loans and loan commitments was $17.0 million in the first quarter of 2010, compared to $25.6 million in the fourth quarter of 2009. Charges-offs decreased for the quarter ending March 31, 2010 as compared to December 31, 2009 to $5.8 million from $18.7 million. As a result, the allowance for loan losses increased to $79.6 million, or 3.29% of total loans, at March 31, 2010, from $62.1 million, or 2.56% of total loans, at December 31, 2009.
As previously disclosed, upon acquiring certain assets and liabilities of the former Mirae Bank, the Company entered into a loss sharing agreement with the FDIC whereby the FDIC has agreed to share in losses on assets covered under the agreement. The assets covered by the loss sharing agreement include loans and foreclosed loan collateral existing at June 26, 2009 and acquired from Mirae Bank. As a result, loans acquired through the acquisition of Mirae Bank are identified herein as “covered” loans, and those that were originated at Wilshire are “non-covered” loans or “legacy Wilshire” loans. The following is a table showing “covered” and “non-covered” loans as of the quarter ended March 31, 2010 and December 31, 2009:
Loan Categories
| | Quarter Ended | |
| | Mar 31, 2010 | | Dec 31, 2009 | |
(dollars in thousands) | | COVERED | | NON-COVERED | | TOTAL | | COVERED | | NON-COVERED | | TOTAL | |
| | | | | | | | | | | | | |
Construction | | $ | — | | $ | 47,564 | | $ | 47,564 | | $ | — | | $ | 48,371 | | $ | 48,371 | |
Real Estate Secured | | 188,353 | | 1,795,142 | | 1,983,495 | | 196,066 | | 1,783,638 | | 1,979,704 | |
Commercial & Industrial | | 61,527 | | 313,872 | | 375,399 | | 62,409 | | 325,034 | | 387,443 | |
Consumer | | 191 | | 16,113 | | 16,304 | | 608 | | 16,626 | | 17,234 | |
TOTAL GROSS LOANS | | $ | 250,071 | | $ | 2,172,691 | | $ | 2,422,762 | | $ | 259,083 | | $ | 2,173,669 | | $ | 2,432,752 | |
Non-accrual Loans
At March 31, 2010, total non-accrual loans were $105.0 million, or 4.34% of total loans, compared to $69.4 million, or 2.86% of total loans, at December 31, 2009. The increase is primarily attributable to increases in commercial real estate loans for retail shopping centers and hotel/motels. New inflows into non-accrual loans in the first quarter of 2010 included 26 commercial real estate loans totaling $35.1 million of which 8 loans totaling $5.5 million were “covered loan” acquired from the acquisition of Mirae Bank.
| | Quarter Ended | |
(Net of SBA Guarantee Portions) | | Mar 31, 2010 | | Dec 31, 2009 | | Mar 31, 2009 | |
(dollars in thousands) | | COVERED | | NON-COVERED | | TOTAL | | COVERED | | NON-COVERED | | TOTAL | | TOTAL | |
| | | | | | | | | | | | | | | |
Construction | | $ | — | | $ | — | | $ | — | | $ | — | | $ | — | | $ | — | | $ | — | |
Real Estate Secured | | 19,696 | | 75,470 | | 95,166 | | 15,555 | | 48,016 | | 63,571 | | 23,185 | |
Commercial & Industrial | | 2,213 | | 7,603 | | 9,816 | | 2,773 | | 3,032 | | 5,805 | | 5,774 | |
Consumer | | — | | 42 | | 42 | | — | | 70 | | 70 | | 307 | |
TOTAL NON-ACCRUALS | | $ | 21,909 | | $ | 83,115 | | $ | 105,024 | | $ | 18,328 | | $ | 51,118 | | $ | 69,446 | | $ | 29,266 | |
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Loan Charge-offs
Loan charge-offs for the first quarter of 2010 were $5.8 million, compared to $18.7 million in the fourth quarter of 2009. The charge-offs in the first quarter were primarily related to commercial real estate loans for retail shopping centers and office buildings.
| | Quarter Ended | |
| | Mar 31, 2010 | | Dec 31, 2009 | | Mar 31, 2009 | |
(dollars in thousands) | | COVERED | | NON-COVERED | | TOTAL | | COVERED | | NON-COVERED | | TOTAL | | TOTAL | |
| | | | | | | | | | | | | | | |
Construction | | $ | — | | $ | — | | $ | — | | $ | 99 | | $ | — | | $ | 99 | | $ | — | |
Real Estate Secured | | 13 | | 4,359 | | 4,372 | | 204 | | 6,798 | | 7,002 | | 672 | |
Commercial & Industrial | | 50 | | 1,290 | | 1,340 | | 59 | | 11,452 | | 11,511 | | 1,629 | |
Consumer | | — | | 115 | | 115 | | — | | 43 | | 43 | | 102 | |
TOTAL CHARGE-OFFS | | $ | 63 | | $ | 5,764 | | $ | 5,827 | | $ | 362 | | $ | 18,293 | | $ | 18,655 | | 2,403 | |
| | | | | | | | | | | | | | | | | | | | | | |
Loan Delinquencies
At March 31, 2010, total loan delinquencies declined to $30.5 million, or 1.26% of total loans, from $40.6 million, or 1.67% of total loans, at December 31, 2009. The decline in delinquencies is attributable to previously delinquent loans migrating to non-accrual status and a slowing of loan entering early-stage delinquency. Delinquencies by days past due and loan type are reflected in the tables below:
| | Quarter Ended | |
By Days Past Due | | Mar 31, 2010 | | Dec 31, 2009 | | Mar 31, 2009 | |
(dollars in thousands) | | COVERED | | NON-COVERED | | TOTAL | | COVERED | | NON-COVERED | | TOTAL | | TOTAL | |
| | | | | | | | | | | | | | | |
30 - 59 Days Past Due | | $ | 3,318 | | $ | 17,266 | | $ | 20,584 | | $ | 3,909 | | $ | 24,614 | | $ | 28,523 | | $ | 12,756 | |
60 - 89 Days Past Due | | 4,640 | | 5,290 | | 9,930 | | 6,224 | | 4,557 | | 10,781 | | 3,387 | |
90 Days, and still accruing | | — | | — | | — | | — | | 1,336 | | 1,336 | | 475 | |
TOTAL DELINQUENCIES | | $ | 7,958 | | $ | 22,556 | | $ | 30,514 | | $ | 10,133 | | $ | 30,507 | | $ | 40,640 | | $ | 16,618 | |
| | Quarter Ended | |
By Loan Category | | Mar 31, 2010 | | Dec 31, 2009 | | Mar 31, 2009 | |
(dollars in thousands) | | COVERED | | NON-COVERED | | TOTAL | | COVERED | | NON-COVERED | | TOTAL | | TOTAL | |
| | | | | | | | | | | | | | | |
Construction | | $ | — | | $ | 1,163 | | $ | 1,163 | | $ | — | | $ | — | | $ | — | | $ | — | |
Real Estate Secured | | 7,283 | | 18,943 | | 26,226 | | 8,655 | | 26,783 | | 35,438 | | 14,336 | |
Commercial & Industrial | | 675 | | 2,328 | | 3,003 | | 1,478 | | 3,528 | | 5,006 | | 2,032 | |
Consumer | | — | | 122 | | 122 | | — | | 196 | | 196 | | 250 | |
TOTAL DELINQUENCIES | | $ | 7,958 | | $ | 22,556 | | $ | 30,514 | | $ | 10,133 | | $ | 30,507 | | $ | 40,640 | | $ | 16,618 | |
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COMMERCIAL REAL ESTATE PORTFOLIO
CRE Loan Composition
Total CRE loans at March 31, 2010 were $1.89 billion, essentially unchanged from December 31, 2009, and an increase of 21% from the $1.56 billion at March 31, 2009, as noted below:
(dollars in thousands) | | Mar 31, 2010 | | % | | Dec 31, 2009 | | % | | 3 Mths
Change | | Mar 31, 2009 | | % | | 12 Mths
Change | |
Multi-Family | | $ | 103,382 | | 6 | % | $ | 112,395 | | 6 | % | -8 | % | $ | 116,880 | | 7 | % | -12 | % |
Office / Mixed Use | | 280,322 | | 15 | % | 277,870 | | 14 | % | 1 | % | 206,308 | | 13 | % | 36 | % |
Retail | | 726,097 | | 38 | % | 722,646 | | 38 | % | 0 | % | 574,263 | | 37 | % | 26 | % |
Industrial / Warehouse | | 325,874 | | 17 | % | 320,176 | | 17 | % | 2 | % | 261,611 | | 17 | % | 25 | % |
Hotel / Motel | | 310,181 | | 16 | % | 310,568 | | 17 | % | 0 | % | 276,003 | | 18 | % | 12 | % |
Other | | 144,314 | | 8 | % | 142,193 | | 8 | % | 1 | % | 126,222 | | 8 | % | 14 | % |
Total CRE Loans | | $ | 1,890,170 | | 100 | % | $ | 1,885,848 | | 100 | % | 0 | % | $ | 1,561,287 | | 100 | % | 21 | % |
The CRE loan maturity distributions are listed below:
(dollars in thousands) | | 2010 | | 2011 | | 2012 | | 2013 | | 2014 | | 2015 & after | | TOTAL | |
Multifamily | | $ | 45,924 | | $ | 6,054 | | 10,898 | | 18,880 | | 12,029 | | 9,597 | | 103,382 | |
Office / Mixed Use | | 48,866 | | 12,777 | | 55,434 | | 44,625 | | 60,066 | | 58,555 | | 280,323 | |
Retail | | 47,600 | | 85,124 | | 105,403 | | 145,721 | | 141,382 | | 200,867 | | 726,097 | |
Industrial / Warehouse | | 37,303 | | 24,988 | | 59,982 | | 43,296 | | 74,363 | | 85,941 | | 325,873 | |
Hotel / Motel | | 37,033 | | 41,774 | | 50,874 | | 47,293 | | 28,773 | | 104,433 | | 310,180 | |
Other | | 30,807 | | 18,940 | | 21,784 | | 18,775 | | 16,443 | | 37,566 | | 144,315 | |
Total CRE Loans | | $ | 247,533 | | $ | 189,657 | | $ | 304,375 | | $ | 318,590 | | $ | 333,056 | | $ | 496,959 | | $ | 1,890,170 | |
% of CRE | | 13 | % | 10 | % | 16 | % | 17 | % | 18 | % | 26 | % | 100 | % |
| | | | | | | | | | | | | | | | | | | | | | |
The Company believes that overall refinance risk is limited based upon relatively low loan-to-value ratios and the fact that 87% of the CRE loan portfolio has maturities in 2011 or later.
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BALANCE SHEET
Total assets increased by 1% to $3.46 billion at March 31, 2010, from $3.44 billion at December 31, 2009. The increase was primarily attributable to a combination of an increase of $36.4 million in investment securities, offset in part by a $9.6 million decrease in loans. The loan portfolio was $2.42 billion at March 31, 2010, compared to $2.43 billion at December 31, 2009.
Total deposits increased by 3% to $2.93 billion at March 31, 2010, from $2.83 billion at December 31, 2009. The increase in deposits includes a substantial increase in core deposits of $145.6 million during the first quarter of 2010. Core deposits consist of demand deposits, savings, NOW accounts, money market accounts, and time deposits under $100,000.
The Company continues to successfully grow its core deposits by introducing new deposit products, attracting new customers, and expanding existing customer relationships. With the successful increase in core deposits, the cost of deposits has decreased considerably. The cost of deposits was 1.55% in the first quarter of 2010, compared to 1.83% in the fourth quarter of 2009. The inflow of core deposits enabled the Company to allow higher rate brokered deposits to run off during the first quarter. Brokered deposits decreased to $16.1 million at March 31, 2010, compared to $25.5 million at December 31, 2009.
As a result of continual growth in core deposits, Wilshire was able to pay off $106.0 million in FHLB borrowings during the first quarter of 2010. Compared to total FHLB borrowings of $340.0 million at March 31, 2009, borrowings are down by 62.9% over the past twelve months.
Strong Capital Ratios
Capital ratios remained strong in the first quarter of 2010 and were well in excess of “well capitalized” regulatory requirements. Based on capital levels as of March 31, 2010, the Company had excess capital to absorb future credit costs, as shown in the table below:
(Dollars In thousands
except per share info) | | March 31, 2010 | | Well Capitalized
Regulatory
Requirements | | Total Excess
Above Well
Capitalized
Requirements | |
| | | | | | | |
Tier 1 Leverage Capital Ratio | | 9.78 | % | 5.00 | % | $ | 162,682 | |
Tier 1 Risk-Based Capital Ratio | | 14.50 | % | 6.00 | % | 195,103 | |
Total Risk-Based Capital Ratio | | 15.95 | % | 10.00 | % | 136,650 | |
Tangible Common Equity To Tangible Assets | | 5.86 | % | N/A | | N/A | |
Tangible Common Equity Per Common Share | | $ | 6.85 | | N/A | | N/A | |
| | | | | | | | | |
During the first quarter of 2010, the Company declared dividends on its common stock in the amount of $0.05 per common share, consistent with prior quarterly dividends. The Company also paid the dividend on the non-cumulative perpetual convertible preferred stock, series A owned by the U.S. Treasury. The Company intends to continue to monitor its dividend policy in light of the current economic environment.
5
STATEMENT OF OPERATIONS
Net interest Income and Margin
Net interest income was $28.6 million in the first quarter of 2010, compared to $19.7 million in the same period of the prior year. The increase is primarily attributable to a higher level of earning assets resulting from the acquisition of the assets of Mirae Bank as well as strong organic growth.
On a sequential quarter basis, net interest margin decreased eight basis points from 3.73% in the fourth quarter of 2009. The sequential quarter decline in net interest margin was primarily due to the reversal of interest income on non-accrual loans and the reversal of loan discount accretion on loans acquired from Mirae Bank both of which resulted in a 36 basis points reduction in net interest margin. The Company’s underlying core earnings strength remains strong as indicated by a much higher net interest margin without the reversal of non-accrual interest on legacy and acquired loans. The Company expects to continue benefiting from a decrease in its cost of funds as $248.5 million in time deposits (excluding State of California deposits) with a weighted average rate of 2.05% are scheduled to mature in the second quarter of 2010.
The weighted average loan yield decreased by 46 basis points to 5.98% in the first quarter of 2010 from 6.44% in the fourth quarter of 2009. The decline in the weighted average loan yield is attributable to the reversal of interest income on non-accrual loans and the reversal of loan discount accretion on loans acquired from Mirae Bank as well as a decrease in total average loans. Total yield on investment securities and other earning assets decreased eleven basis points to 3.13% in the first quarter of 2010 from 3.24% in the fourth quarter of 2009.
Non-Interest Income
Non-interest income was $7.8 million in the first quarter of 2010, an increase of 108% from $3.8 million in the same period of the prior year. The increase is primarily due to a $2.5 million gain on sale of investment securities in the first quarter of 2010.
The Company did not recognize any gain on the sale of SBA loans in the first quarter of 2010 due to the adoption of new accounting standards on January 1, 2010. The Company originated $23.5 million in SBA loans during the first quarter of 2010 and sold approximately $14.0 million in SBA loans. The gain on sale from these loans is expected to be recognized in the second quarter of 2010 upon reevaluation after expiration of the recourse provisions.
Non-Interest Expense
Total non-interest expense was $14.7 million in the first quarter of 2010, an increase of 23% from $12.0 million in the same period of the prior year. The increase is primarily due to growth in personnel and occupancy expenses related to the acquisition of Mirae Bank and other branch openings.
The Company’s efficiency ratio in the first quarter of 2010 was 40.42%, compared to 35.08% in the fourth quarter of 2009 and 51.22% in the first quarter of 2009. On a sequential quarter basis, the increase in the efficiency ratio is primarily due to lower revenue resulting from a smaller gain on sale of investment securities and loans.
6
CONFERENCE CALL
Management will host its quarterly conference call on April 22, 2010, at 11:00 a.m. PDT (2:00 p.m. EDT). Investment professionals are invited to participate in the call by dialing 1-800-901-5218 (domestic number) or 1-617-786-4511 (international number) and entering passcode 96992893.
COMPANY INFORMATION
Headquartered in Los Angeles, Wilshire State Bank operates 24 branch offices in California, Texas, New Jersey and New York, and six loan production offices in Dallas, Houston, Atlanta, Denver, Annandale, Virginia, and Fort Lee, New Jersey, and is an SBA preferred lender nationwide. Wilshire State Bank is a community bank with a focus on commercial real estate lending and general commercial banking, with its primary market encompassing the multi-ethnic populations of the Los Angeles Metropolitan area. Wilshire Bancorp’s strategic goals include increasing shareholder and franchise value by continuing to grow its multi-ethnic banking business and expanding its geographic reach to other similar markets with strong levels of small business activity.
www.wilshirebank.com
FORWARD-LOOKING STATEMENTS
Statements concerning future performance, events, or any other guidance on future periods constitute forward-looking statements that are subject to a number of risks and uncertainties that might cause actual results to differ materially from stated expectations. Specific factors include, but are not limited to, loan production and sales, credit quality, the ability to expand net interest margin, the ability to continue to attract low-cost deposits, success of expansion efforts, competition in the marketplace and general economic conditions. The financial information contained in this release should be read in conjunction with the consolidated financial statements and notes included in Wilshire Bancorp’s most recent reports on Form 10-K and Form 10-Q, as filed with the Securities and Exchange Commission, as they may be amended from time to time. Results of operations for the most recent quarter are not necessarily indicative of operating results for any future periods. Any projections in this release are based on limited information currently available to management and are subject to change. Since management will only provide guidance at certain points during the year, Wilshire Bancorp will not necessarily update the information. Such information speaks only as of the date of this release. Additional information on these and other factors that could affect financial results are included in filings by Wilshire Bancorp with the Securities and Exchange Commission.
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CONSOLIDATED BALANCE SHEET
(dollars in thousands) (unaudited)
| | March 31, | | December 31, | | Three Month | | March 31, | | One Year | |
| | 2010 | | 2009 | | Change | | 2009 | | Change | |
| | | | | | | | | | | |
ASSETS: | | | | | | | | | | | |
Cash and Due from Banks | | $ | 214,970 | | $ | 155,753 | | 38 | % | $ | 61,268 | | 251 | % |
Federal Funds Sold and Other Cash Equivalents | | 30,018 | | 80,004 | | -62 | % | 85,001 | | -65 | % |
Total Cash and Cash Equivalents | | 244,988 | | 235,757 | | 4 | % | 146,269 | | 67 | % |
| | | | | | | | | | | |
Investment Securities Available For Sale | | 687,716 | | 651,318 | | 6 | % | 320,055 | | 115 | % |
Investment Securities Held To Maturity | | 105 | | 109 | | -4 | % | 133 | | -22 | % |
Total Investment Securities | | 687,821 | | 651,427 | | 6 | % | 320,188 | | 115 | % |
Loans | | | | | | | | | | | |
Real Estate Construction | | 47,564 | | 48,371 | | -2 | % | 42,075 | | 13 | % |
Residential Real Estate | | 94,584 | | 93,828 | | 1 | % | 78,666 | | 20 | % |
Commercial Real Estate | | 1,885,276 | | 1,881,998 | | 0 | % | 1,558,507 | | 21 | % |
Commercial and Industrial | | 374,096 | | 385,958 | | -3 | % | 375,899 | | 0 | % |
Consumer | | 16,304 | | 17,286 | | -6 | % | 18,854 | | -14 | % |
Total Loans | | 2,417,824 | | 2,427,441 | | 0 | % | 2,074,001 | | 17 | % |
Allowance For Loan Losses | | (79,576 | ) | (62,130 | ) | 28 | % | (34,156 | ) | 133 | % |
Loans, Net of Allowance for Loan Losses | | 2,338,248 | | 2,365,311 | | -1 | % | 2,039,845 | | 15 | % |
| | | | | | | | | | | |
Accrued Interest Receivable | | 15,214 | | 15,266 | | 0 | % | 10,122 | | 50 | % |
Due from Customers on Acceptances | | 1,006 | | 945 | | 7 | % | 312 | | 222 | % |
Other Real Estate Owned | | 4,860 | | 3,797 | | 28 | % | 6,282 | | -23 | % |
Premises and Equipment | | 13,602 | | 12,660 | | 7 | % | 11,475 | | 19 | % |
Federal Home Loan Bank (FHLB) Stock, at Cost | | 21,040 | | 21,040 | | 0 | % | 17,537 | | 20 | % |
Cash Surrender Value of Life Insurance | | 18,197 | | 18,037 | | 1 | % | 17,559 | | 4 | % |
Investment in affordable housing partnerships | | 25,127 | | 13,732 | | 83 | % | 11,214 | | 124 | % |
Deferred Income Taxes | | 20,198 | | 18,684 | | 8 | % | 11,815 | | 71 | % |
Servicing Assets | | 6,715 | | 6,898 | | -3 | % | 4,790 | | 40 | % |
Goodwill | | 6,675 | | 6,675 | | 0 | % | 6,675 | | 0 | % |
FDIC Indemnification | | 33,329 | | 33,775 | | -1 | % | — | | 0 | % |
Other Assets | | 22,292 | | 31,993 | | -30 | % | 7,199 | | 210 | % |
TOTAL ASSETS | | $ | 3,459,312 | | $ | 3,435,997 | | 1 | % | $ | 2,611,282 | | 32 | % |
| | | | | | | | | | | |
LIABILITIES AND STOCKHOLDERS’ EQUITY: | | | | | | | | | | | |
LIABILITIES: | | | | | | | | | | | |
Non-interest Bearing Demand Deposits | | $ | 414,023 | | $ | 385,188 | | 7 | % | $ | 298,044 | | 39 | % |
Savings and Interest Checking | | 97,170 | | 94,539 | | 3 | % | 64,818 | | 50 | % |
Money Market Deposits | | 979,454 | | 909,125 | | 8 | % | 375,761 | | 161 | % |
Time Deposits in denomination of $100,000 or more | | 746,866 | | 795,679 | | -6 | % | 969,001 | | -23 | % |
Other Time Deposits | | 687,532 | | 643,684 | | 7 | % | 197,823 | | 248 | % |
Total Deposits | | 2,925,045 | | 2,828,215 | | 3 | % | 1,905,447 | | 54 | % |
| | | | | | | | | | | |
FHLB borrowings and Federal Funds Purchased | | 142,487 | | 232,000 | | -39 | % | 340,000 | | -58 | % |
Acceptance Outstanding | | 1,006 | | 945 | | 7 | % | 312 | | 222 | % |
Junior Subordinated Debentures | | 87,321 | | 87,321 | | 0 | % | 87,321 | | 0 | % |
Accrued Interest Payable | | 5,954 | | 5,865 | | 2 | % | 7,330 | | -19 | % |
Other Liabilities | | 26,804 | | 15,515 | | 73 | % | 13,166 | | 104 | % |
Total Liabilities | | 3,188,592 | | 3,169,861 | | 1 | % | 2,353,576 | | 35 | % |
| | | | | | | | | | | |
STOCKHOLDERS’ EQUITY: | | | | | | | | | | | |
Preferred Stock | | 60,058 | | 59,931 | | 0 | % | 59,562 | | 1 | % |
Common Stock | | 55,118 | | 54,918 | | 0 | % | 54,238 | | 2 | % |
Retained Earnings | | 151,895 | | 150,961 | | 1 | % | 141,008 | | 8 | % |
Accumulated Other Comprehensive Income | | 3,624 | | 326 | | 1012 | % | 2,898 | | 25 | % |
Total Stockholders’ Equity | | 270,695 | | 266,136 | | 2 | % | 257,706 | | 5 | % |
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | | $ | 3,459,312 | | $ | 3,435,997 | | 1 | % | $ | 2,611,282 | | 32 | % |
(continued)
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CONSOLIDATED STATEMENT OF OPERATIONS
(dollars in thousands, except per share data) (unaudited)
| | Quarter Ended | | Three Month | | Quarter Ended | | One Year | |
| | March 31, 2010 | | December 31, 2009 | | % Change | | March 31, 2009 | | % Change | |
| | | | | | | | | | | |
INTEREST INCOME | | | | | | | | | | | |
Interest and Fees on Loans | | $ | 35,304 | | $ | 38,478 | | -8 | % | $ | 30,193 | | 17 | % |
Interest on Investment Securities | | 5,615 | | 5,562 | | 14 | % | 2,942 | | 91 | % |
Interest on Federal Funds Sold | | 382 | | 576 | | -34 | % | 289 | | 32 | % |
Total Interest Income | | 41,301 | | 45,109 | | -7 | % | 36,406 | | 24 | % |
| | | | | | | | | | | |
INTEREST EXPENSE | | | | | | | | | | | |
Deposits | | 11,174 | | 12,737 | | -12 | % | 11,181 | | 0 | % |
FHLB Advances and Other Borrowings | | 1,569 | | 2,473 | | -37 | % | 2,579 | | -39 | % |
Total Interest Expense | | 12,743 | | 15,210 | | -16 | % | 13,760 | | -7 | % |
| | | | | | | | | | | |
Net Interest Income Before Provision for Losses on Loans and Loan Commitments | | 28,558 | | 29,406 | | -3 | % | 19,664 | | 45 | % |
Provision for Losses on Loans and Loan Commitments | | 17,000 | | 25,600 | | -34 | % | 6,700 | | 154 | % |
Net Interest Income After Provision for Losses on Loans and Loan Commitments | | 11,558 | | 3,806 | | 204 | % | 12,964 | | -11 | % |
| | | | | | | | | | | |
NONINTEREST INCOME | | | | | | | | | | | |
Service Charges on Deposits | | 3,224 | | 3,400 | | -5 | % | 2,899 | | 11 | % |
Gain on Sales of Loans | | 36 | | 1,983 | | -98 | % | (831 | ) | -104 | % |
Gain on Sale of Investment Securities | | 2,484 | | 9,569 | | -74 | % | 13 | | 19014 | % |
Other | | 2,041 | | 2,636 | | -23 | % | 1,656 | | 23 | % |
Total Noninterest Income | | 7,785 | | 17,588 | | -56 | % | 3,737 | | 108 | % |
| | | | | | | | | | | |
NONINTEREST EXPENSES | | | | | | | | | | | |
Salaries and Employee Benefits | | 7,115 | | 7,183 | | -1 | % | 6,207 | | 15 | % |
Occupancy & Equipment | | 2,181 | | 2,162 | | 1 | % | 1,676 | | 30 | % |
Data Processing | | 637 | | 1,219 | | -48 | % | 827 | | -23 | % |
Other | | 4,757 | | 5,921 | | -20 | % | 3,277 | | 45 | % |
Total Noninterest Expenses | | 14,690 | | 16,485 | | -11 | % | 11,987 | | 23 | % |
| | | | | | | | | | | |
Income Before Income Taxes | | 4,653 | | 4,909 | | -5 | % | 4,714 | | -1 | % |
Income Taxes | | 1,338 | | 833 | | 61 | % | 1,655 | | -19 | % |
NET INCOME | | 3,315 | | 4,076 | | -19 | % | 3,059 | | 8 | % |
| | | | | | | | | | | |
Preferred Stock Cash Dividend and Accretion of Preferred Stock Discount | | 903 | | 902 | | 0 | % | 920 | | -2 | % |
NET INCOME AVAILABLE TO COMMON SHAREHOLDERS | | $ | 2,412 | | $ | 3,174 | | -24 | % | $ | 2,139 | | 13 | % |
| | | | | | | | | | | |
PER COMMON SHARE INFORMATION | | | | | | | | | | | |
Basic Earnings Per Common Share | | $ | 0.08 | | $ | 0.11 | | -24 | % | $ | 0.07 | | 13 | % |
Diluted Earnings Per Common Share | | $ | 0.08 | | $ | 0.11 | | -24 | % | $ | 0.07 | | 13 | % |
| | | | | | | | | | | |
WEIGHTED-AVERAGE COMMON SHARES OUTSTANDING: | | | | | | | | | | | |
Basic | | 29,484,006 | | 29,413,943 | | | | 29,413,757 | | | |
Diluted | | 29,537,933 | | 29,423,424 | | | | 29,422,290 | | | |
(continued)
9
SUMMARY OF FINANCIAL DATA
(dollars in thousands, except per share data) (unaudited)
| | Quarter Ended | | | | |
AVERAGE BALANCES | | March 31, 2010 | | | | December 31, 2009 | | | | March 31, 2009 | | | | |
| | | | | | | | | | | | | | |
Average Assets | | $ | 3,417,633 | | | | $ | 3,414,830 | | | | $ | 2,525,225 | | | | |
Average Equity | | 273,293 | | | | 278,382 | | | | 259,072 | | | | |
Average Net Loans | | 2,359,522 | | | | 2,388,443 | | | | 2,030,595 | | | | |
Average Deposits | | 2,886,514 | | | | 2,787,804 | | | | 1,832,479 | | | | |
Average Time Deposits in denomination of $100,000 or more | | 768,882 | | | | 862,805 | | | | 933,494 | | | | |
Average Interest Earning Assets | | 3,155,853 | | | | 3,175,516 | | | | 2,362,787 | | | | |
| | | | | | | | | | | | | | | | | |
| | Quarter Ended | | | |
PROFITABILITY | | March 31, 2010 | | | | December 31, 2009 | | | | March 31, 2009 | | | |
| | | | | | | | | | | | | |
Annualized Return on Average Assets | | 0.39 | % | | | 0.48 | % | | | 0.48 | % | | |
Annualized Return on Average Equity | | 4.85 | % | | | 5.86 | % | | | 4.72 | % | | |
Efficiency Ratio | | 40.42 | % | | | 35.08 | % | | | 51.22 | % | | |
Annualized Operating Expense/Average Assets | | 1.72 | % | | | 1.93 | % | | | 1.90 | % | | |
Annualized Net Interest Margin | | 3.65 | % | | | 3.73 | % | | | 3.35 | % | | |
| | | | | | | | | | | | | |
| | Quarter Ended | |
DEPOSIT COMPOSITION | | March 31, 2010 | | Cost of
Funds | | December 31, 2009 | | Cost of
Funds | | March 31, 2009 | | Cost of
Funds | |
| | | | | | | | | | | | | |
Noninterest Bearing Demand Deposits | | 14.2 | % | 0.00 | % | 13.6 | % | 0.00 | % | 15.6 | % | 0.00 | % |
Savings & Interest Checking | | 3.3 | % | 2.55 | % | 3.3 | % | 2.68 | % | 3.4 | % | 2.79 | % |
Money Market Deposits | | 33.5 | % | 1.68 | % | 32.2 | % | 2.18 | % | 19.7 | % | 2.57 | % |
Time Deposits of $100,000 or More | | 25.5 | % | 1.58 | % | 28.1 | % | 1.91 | % | 50.9 | % | 2.86 | % |
Other Time Deposits | | 23.5 | % | 2.07 | % | 22.8 | % | 2.27 | % | 10.4 | % | 3.54 | % |
Total Deposits | | 100.0 | % | 1.55 | % | 100.0 | % | 1.83 | % | 100.0 | % | 2.44 | % |
| | | | | | | | | | | | | |
| | Quarter Ended | | | |
CAPITAL RATIOS | | March 31, 2010 | | | | December 31, 2009 | | | | March 31, 2009 | | | |
| | | | | | | | | | | | | |
Tier 1 Leverage Ratio | | 9.78 | % | | | 9.77 | % | | | 12.79 | % | | |
Tier 1 Risk-Based Capital Ratio | | 14.50 | % | | | 14.37 | % | | | 15.15 | % | | |
Total Risk-Based Capital Ratio | | 15.95 | % | | | 15.81 | % | | | 16.69 | % | | |
Total Shareholders’ Equity | | $ | 270,695 | | | | $ | 266,136 | | | | $ | 257,706 | | | |
Book Value Per Common Share | | $ | 7.14 | | | | $ | 7.01 | | | | $ | 6.74 | | | |
Tangible Common Equity Per Common Share * | | $ | 6.85 | | | | $ | 6.71 | | | | $ | 6.47 | | | |
Tangible Common Equity to Tangible Assets ** | | 5.86 | % | | | 5.76 | % | | | 7.31 | % | | |
* Tangible common equity excludes goodwill, other intangible assets, and TARP preferred stock
** Tangible assets excludes goodwill and intangible assets
Reconciliation of GAAP financial measures to non-GAAP financial measures:
| | March 31, 2010 | | December 31, 2009 | | March 31, 2009 | |
Total stockholders’ equity | | $ | 270,695 | | $ | 266,136 | | $ | 257,706 | |
Preferred stock, net of discount | | (60,058 | ) | (59,931 | ) | (59,562 | ) |
Goodwill and other intangible assets, net | | (8,596 | ) | (8,688 | ) | (7,889 | ) |
Tangible common equity | | $ | 202,041 | | $ | 197,517 | | $ | 190,255 | |
| | | | | | | |
Total assets | | $ | 3,459,312 | | $ | 3,435,997 | | $ | 2,611,282 | |
Goodwill and other intangible assets, net | | (8,596 | ) | (8,688 | ) | (7,889 | ) |
Tangible assets | | $ | 3,450,716 | | $ | 3,427,309 | | $ | 2,603,393 | |
| | | | | | | |
Common shares outstanding | | 29,485,637 | | 29,415,657 | | 29,413,757 | |
(continued)
10
SUMMARY OF FINANCIAL DATA
(dollars in thousands, except per share data) (unaudited)
ALLOWANCE FOR LOAN LOSSES
(net of SBA guaranteed portions)
| | Quarter Ended | |
| | March 31, 2010 | | December 31, 2009 | | September 30, 2009 | | June 30, 2009 | | March 31, 2009 | |
| | | | | | | | | | | |
Balance at Beginning of Period | | $ | 62,130 | | $ | 54,735 | | $ | 38,758 | | $ | 34,156 | | $ | 29,437 | |
Provision for Losses on Loans | | 16,930 | | 24,540 | | 23,967 | | 11,812 | | 7,009 | |
FDIC Indemnification | | 5,831 | | 856 | | — | | — | | — | |
Recoveries on loans previously charged-off | | 512 | | 654 | | 223 | | 262 | | 113 | |
Less Charge-offs | | (5,827 | ) | (18,655 | ) | (8,213 | ) | (7,472 | ) | (2,403 | ) |
Balance at End of Period | | $ | 79,576 | | $ | 62,130 | | $ | 54,735 | | $ | 38,758 | | $ | 34,156 | |
| | | | | | | | | | | |
Net Loan Charge-offs/Average Total Loans | | 0.22 | % | 0.74 | % | 0.33 | % | 0.34 | % | 0.11 | % |
Charge-offs/Average Total Loans | | 0.24 | % | 0.76 | % | 0.34 | % | 0.36 | % | 0.12 | % |
Allowance for Loan Losses/Total Loans | | 3.29 | % | 2.56 | % | 2.24 | % | 1.62 | % | 1.65 | % |
Allowance for Loan Losses/Legacy Wilshire Loans | | 3.66 | % | 2.86 | % | 2.52 | % | 1.83 | % | 1.65 | % |
Allowance for Loan Losses/Non-accrual Loans | | 75.77 | % | 89.47 | % | 70.72 | % | 78.58 | % | 116.71 | % |
Allowance for Loan Losses/Non-performing Loans | | 75.77 | % | 87.78 | % | 70.02 | % | 78.38 | % | 114.84 | % |
Allowance for Loan Losses/Total Assets | | 2.30 | % | 1.81 | % | 1.62 | % | 1.22 | % | 1.31 | % |
Allowance for Loan Losses/Non-performing Assets | | 72.42 | % | 83.31 | % | 64.85 | % | 71.62 | % | 94.82 | % |
NON-PERFORMING ASSETS
(net of SBA guaranteed portions)
| | Quarter Ended | |
| | March 31, 2010 | | December 31, 2009 | | September 30, 2009 | | June 30, 2009 | | March 31, 2009 | |
Nonaccrual Loans: | | | | | | | | | | | |
Non-covered Loans | | $ | 83,115 | | $ | 51,118 | | $ | 52,386 | | $ | 35,032 | | $ | 29,266 | |
Covered Loans | | 21,909 | | 18,328 | | 25,007 | | 14,290 | | — | |
Total | | 105,024 | | 69,446 | | 77,393 | | 49,322 | | 29,266 | |
| | | | | | | | | | | |
Loans 90 days or more past due and still accruing: | | | | | | | | | | | |
Non-covered Loans | | — | | 1,336 | | — | | 128 | | 475 | |
Covered Loans | | — | | — | | 772 | | — | | — | |
Total | | — | | 1,336 | | 772 | | 128 | | 475 | |
| | | | | | | | | | | |
Total Nonperforming Loans: | | | | | | | | | | | |
Non-covered Loans | | 83,115 | | 52,455 | | 52,386 | | 35,160 | | 29,741 | |
Covered Loans | | 21,909 | | 18,327 | | 25,779 | | 14,290 | | — | |
Total | | 105,024 | | 70,782 | | 78,165 | | 49,450 | | 29,741 | |
| | | | | | | | | | | |
OREO and Repossessed Vehicles: | | | | | | | | | | | |
Non-covered Loans | | 3,136 | | 3,297 | | 5,738 | | 5,456 | | 6,282 | |
Covered Loans | | 1,723 | | 500 | | 500 | | 500 | | — | |
Total | | 4,859 | | 3,797 | | 6,238 | | 5,956 | | 6,282 | |
| | | | | | | | | | | |
Total Nonperforming Assets: | | | | | | | | | | | |
Non-covered Loans | | 86,251 | | 55,752 | | 58,124 | | 40,616 | | 36,023 | |
Covered Loans | | 23,632 | | 18,827 | | 26,279 | | 14,790 | | — | |
Total | | $ | 109,883 | | $ | 74,579 | | $ | 84,403 | | $ | 55,406 | | $ | 36,023 | |
| | | | | | | | | | | |
Total Nonperforming Loans/Total Loans | | 4.34 | % | 2.92 | % | 3.20 | % | 2.01 | % | 1.43 | % |
| | | | | | | | | | | |
Total Nonperforming Assets/Total Assets | | 3.18 | % | 2.17 | % | 2.50 | % | 1.70 | % | 1.38 | % |
Performing Troubled Debt Restructured (TDR) Loans
(dollars in thousands)
| | Quarter Ended | |
| | March 31, 2010 | | December 31, 2009 | |
| | COVERED | | NON-COVERED | | TOTAL | | COVERED | | NON-COVERED | | TOTAL | |
| | | | | | | | | | | | | |
Construction | | $ | — | | $ | — | | $ | — | | $ | — | | $ | — | | $ | — | |
Real Estate Secured | | 8,135 | | 46,024 | | 54,159 | | 9,175 | | 54,414 | | 63,589 | |
Commercial & Industrial | | — | | 474 | | 474 | | — | | 1,023 | | 1,023 | |
Consumer | | — | | — | | — | | — | | — | | — | |
TOTAL PERFORMING TDR LOANS | | $ | 8,135 | | $ | 46,498 | | $ | 54,633 | | $ | 9,175 | | $ | 55,437 | | $ | 64,612 | |
(continued)
11
LOAN ORIGINATION AMOUNT
| | Quarter Ended | |
| | March 31, 2010 | | December 31, 2009 | | September 30, 2009 | | June 30, 2009 | | March 31, 2009 | |
| | | | | | | | | | | |
Total new loan origination amount, excluding renewal. | | $ | 87,288 | | $ | 125,281 | | $ | 183,859 | | $ | 159,334 | | $ | 72,412 | |
SBA new loan origination amount, excluding renewal. | | $ | 23,471 | | $ | 17,158 | | $ | 15,592 | | $ | 12,456 | | $ | 9,190 | |
ALLOWANCE FOR OFF-BALANCE SHEET ITEMS
(Non-covered loan only)
(net of SBA guaranteed portions)
| | Three Months Ended | | | | | | | | |
| | March 31, 2010 | | March 31, 2009 | | | | | | | | |
Balance at Beginning of Period | | $ | 2,515 | | $ | 1,243 | | | | | | | | |
Provision for (Recapture of) Losses on Off-balance Sheet Items | | 70 | | (309 | ) | | | | | | | |
Balance at End of Period | | $ | 2,585 | | $ | 934 | | | | | | | | |
(continued)
12
WILSHIRE BANCORP, INC. AND SUBSIDIARIES
AVERAGE BALANCES, AVERAGE YIELDS EARNED AND AVERAGE RATES PAID
(dollars in thousands) (unaudited)
| | For the Three Months Ended | |
| | March 31, 2010 | | December 31, 2009 | | March 31, 2009 | |
| | | | Interest | | Average | | | | Interest | | Average | | | | Interest | | Average | |
| | Average | | Income/ | | Yield/ | | Average | | Income/ | | Yield/ | | Average | | Income/ | | Yield/ | |
| | Balance | | Expense | | Rate | | Balance | | Expense | | Rate | | Balance | | Expense | | Rate | |
INTEREST EARNING ASSETS | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | |
Real Estate Loans | | $ | 2,030,514 | | $ | 29,053 | | 5.72 | % | $ | 2,027,288 | | $ | 31,822 | | 6.28 | % | $ | 1,654,867 | | $ | 24,905 | | 6.02 | % |
Commercial Loans | | 382,589 | | 5,308 | | 5.55 | % | 400,784 | | 5,745 | | 5.73 | % | 388,710 | | 4,418 | | 4.55 | % |
Consumer Loans | | 16,474 | | 180 | | 4.38 | % | 17,588 | | 229 | | 5.21 | % | 21,150 | | 301 | | 5.69 | % |
Total Gross Loans | | 2,429,577 | | 34,541 | | 5.69 | % | 2,445,660 | | 37,796 | | 6.18 | % | 2,064,727 | | 29,624 | | 5.74 | % |
Loan Fees toward Yield | | | | 763 | | | | | | 682 | | | | | | 569 | | | |
Allowance for Loan Losses & Unearned Income | | (70,055 | ) | | | | | (57,217 | ) | | | | | (34,132 | ) | | | | |
Net Loans | | 2,359,522 | | 35,304 | | 5.98 | % | 2,388,443 | | 38,478 | | 6.44 | % | 2,030,595 | | 30,193 | | 5.95 | % |
| | | | | | | | | | | | | | | | | | | |
INVESTMENT SECURITIES AND OTHER INTEREST-EARNING ASSETS: | | | | | | | | | | | | | | | | | | | |
Investment Securities* | | 665,366 | | 5,615 | | 3.52 | % | 613,021 | | 5,562 | | 3.79 | % | 286,553 | | 2,943 | | 4.24 | % |
Federal Funds Sold | | 130,965 | | 382 | | 1.17 | % | 174,052 | | 576 | | 1.32 | % | 45,639 | | 289 | | 2.53 | % |
Total Investment Securities and Other Earning Assets | | 796,331 | | 5,997 | | 3.13 | % | 787,073 | | 6,138 | | 3.24 | % | 332,192 | | 3,232 | | 4.01 | % |
| | | | | | | | | | | | | | | | | | | |
TOTAL INTEREST-EARNING ASSETS | | $ | 3,155,853 | | $ | 41,301 | | 5.27 | % | $ | 3,175,516 | | $ | 44,616 | | 5.65 | % | $ | 2,362,787 | | $ | 33,425 | | 5.67 | % |
| | | | | | | | | | | | | | | | | | | |
INTEREST BEARING LIABILITIES | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | |
INTEREST-BEARING DEPOSITS: | | | | | | | | | | | | | | | | | | | |
Money Market | | $ | 956,035 | | $ | 4,023 | | 1.68 | % | $ | 853,770 | | $ | 4,661 | | 2.18 | % | $ | 362,733 | | $ | 2,332 | | 2.57 | % |
NOW | | 22,481 | | 29 | | 0.52 | % | 21,971 | | 36 | | 0.65 | % | 19,557 | | 46 | | 0.94 | % |
Savings | | 74,052 | | 586 | | 3.17 | % | 68,373 | | 569 | | 3.33 | % | 43,241 | | 393 | | 3.63 | % |
Time Deposits of $100,000 or More | | 768,882 | | 3,047 | | 1.58 | % | 862,805 | | 4,113 | | 1.91 | % | 933,494 | | 6,668 | | 2.86 | % |
Other Time Deposits | | 675,764 | | 3,489 | | 2.07 | % | 592,336 | | 3,358 | | 2.27 | % | 196,714 | | 1,743 | | 3.54 | % |
Total Interest Bearing Deposits | | 2,497,214 | | 11,174 | | 1.79 | % | 2,399,255 | | 12,737 | | 2.12 | % | 1,555,739 | | 11,182 | | 2.87 | % |
| | | | | | | | | | | | | | | | | | | |
BORROWINGS: | | | | | | | | | | | | | | | | | | | |
FHLB Advances and Other Borrowings | | 148,000 | | 920 | | 2.49 | % | 238,017 | | 1,811 | | 3.04 | % | 327,344 | | 1,658 | | 2.03 | % |
Junior Subordinated Debentures | | 87,321 | | 649 | | 2.97 | % | 87,321 | | 662 | | 3.03 | % | 87,321 | | 921 | | 4.22 | % |
Total Borrowings | | 235,321 | | 1,569 | | 2.67 | % | 325,338 | | 2,473 | | 3.04 | % | 414,665 | | 2,579 | | 2.49 | % |
| | | | | | | | | | | | | | | | | | | |
TOTAL INTEREST BEARING LIABILITIES | | $ | 2,732,535 | | $ | 12,743 | | 1.87 | % | $ | 2,622,088 | | $ | 15,210 | | 2.23 | % | $ | 1,970,404 | | $ | 13,761 | | 2.79 | % |
| | | | | | | | | | | | | | | | | | | |
NET INTEREST INCOME | | | | $ | 28,558 | | | | | | $ | 29,406 | | | | | | $ | 19,664 | | | |
| | | | | | | | | | | | | | | | | | | |
NET INTEREST SPREAD | | | | | | 3.40 | % | | | | | 3.42 | % | | | | | 2.88 | % |
| | | | | | | | | | | | | | | | | | | |
NET INTEREST MARGIN | | | | | | 3.65 | % | | | | | 3.73 | % | | | | | 3.35 | % |
* Tax equivalent ratios for investment securities
(concluded)
13
