EXHIBIT 99.1
Encore Bancshares Reports Third Quarter 2011 Net Earnings of $1.9 Million
HOUSTON, Oct. 28, 2011 (GLOBE NEWSWIRE) -- Encore Bancshares, Inc. (Nasdaq:EBTX) today announced its financial results for the third quarter of 2011.
Third Quarter Highlights
Redeemed $34.0 million of CPP preferred stock issued to the U.S. Treasury
- Issued $32.9 million in preferred stock to the U.S. Treasury under the Small Business Lending Fund (SBLF)
- Incurred one-time non-cash charge to common equity of $4.1 million related to the CPP preferred stock redemption
Improved earnings metrics compared with third quarter 2010
- Revenue was $18.3 million, up 1.6%
- Wealth management revenue increased 4.6%
- Noninterest expense decreased 28.3%
- Loan loss provision declined $8.3 million
Grew Texas franchise compared with September 30, 2010
- Noninterest bearing demand deposit growth of 36.9%
- Noninterest bearing demand deposits were 26.9% of total deposits, up from 19.7%
- Commercial loan growth of 26.9%, total loan growth of 6.0%
Maintained solid capital ratios
- Estimated tier 1 capital ratio of 13.37%
- Tangible common equity ratio of 6.91%
Resolved $7.3 million of problem assets subsequent to quarter end
- Resolved $4.1 million in Florida nonaccrual loans
- Sold a $3.2 million residential property in Houston included in OREO
- Proforma NPAs as of September 30, 2011 of 1.62% to total loans and OREO
"We concluded a successful quarter with the redemption of the CPP preferred stock," said James S. D'Agostino, Jr., Chairman and Chief Executive Officer of Encore Bancshares, Inc. "We have continued to execute on our strategy of growing Houston commercial loans and deposits and reducing problem assets. The Houston economy is one of the most attractive banking markets in the nation and we believe we have significant growth potential in this market."
Earnings
For the three months ended September 30, 2011, our net earnings were $1.9 million, compared with a net loss of $8.4 million for the same period of 2010. The loss per diluted common share for the third quarter of 2011 was $0.23, compared with a loss per diluted common share of $0.79 for the same period of 2010, after deducting preferred dividends for each period. In addition to the regular preferred dividend, we incurred a one-time non-cash charge to common equity of $4.1 million upon redemption of the CPP preferred stock to account for the difference between the amount at which the preferred stock sale had been initially recorded and its redemption price. Excluding the non-cash charge, earnings per share would have been $0.12 per diluted common share.
For the nine months ended September 30, 2011, our net earnings were $5.1 million, compared with a net loss of $23.3 million for the same period of 2010. The loss per diluted common share for the nine months ended September 30, 2011 was $0.05, compared with a loss per diluted common share of $2.25 for the same period of 2010, after deducting preferred dividends for each period. Earnings for both periods of 2011 improved due to lower credit costs and reduced expenses related to the sale of our Florida operations, which was completed December 31, 2010.
Net Interest Income
Net interest income on a tax equivalent basis (TE) for the third quarter of 2011 was $11.4 million, an increase of $293,000, or 2.6%, compared with the same period of 2010, reflecting an improved net interest margin. The net interest margin (TE) expanded 37 basis points to 3.20% during the same comparison period. The increase in margin was due primarily to an improved balance sheet mix, as temporary investments and higher costing deposits decreased after the sale of our Florida operations. On a linked quarter basis (compared with the immediately preceding quarter), net interest income (TE) decreased $466,000, or 3.9%, and the net interest margin decreased by 34 basis points, resulting mainly from a $418,000 interest recovery in the second quarter and growth in temporary investments due to increased average deposits.
Noninterest Income
Noninterest income was $7.0 million for the third quarter of 2011, essentially unchanged compared with the same period of 2010. Trust and investment management fees increased $213,000, or 4.6%, but was offset by lower gain on sale of securities. Noninterest income decreased from the second quarter of 2011 due primarily to lower assets under management, which reflected declines in the equity market, and resulted in lower trust and investment management fees.
Noninterest Expense
Noninterest expense was $14.9 million for the third quarter of 2011, a decrease of $5.9 million, compared with the same period of 2010. The decrease was due primarily to a combination of lower FDIC assessment and the sale of our Florida operations, which resulted in a significant reduction in credit related costs, including other real estate owned (OREO) expenses and write downs of assets held for sale, and other operating expenses. On a linked quarter basis, noninterest expense increased $746,000 due mainly to mark to market adjustments for OREO and the settlement of a legal claim.
Segment Earnings
On a segment basis, our banking segment had net earnings of $686,000, compared with a net loss of $9.3 million in the same period of 2010. The third quarter of 2010 included significant credit related costs, which were primarily in Florida. Our wealth management group had net earnings of $777,000 for the third quarter of 2011, essentially unchanged, compared with the same period of 2010. Our insurance agency had earnings of $203,000, down $48,000, compared with the same period of 2010, due to higher expenses reflecting cost for new producers.
Loans
Period end loans, including loans held for sale, were $985.5 million at September 30, 2011, a decrease of $50.6 million, or 4.9%, compared with September 30, 2010. This decrease was due primarily to the sale of Florida loans in connection with the sale of our Florida operations. Excluding Florida loans, total loans increased $53.2 million, or 6.0% and commercial loans in Texas grew $90.1 million, or 26.9%, in the same comparison period.
Deposits
Period end deposits were $1.0 billion at September 30, 2011, a decrease of $183.8 million, or 14.9%, compared with September 30, 2010. The decrease was mainly due to the sale of approximately $180.8 million in Florida deposits in December 2010. Texas noninterest-bearing deposits at September 30, 2011 were $282.0 million, an increase of $76.1 million, or 36.9%, and represented 26.9% of total deposits.
Credit Quality and Capital Ratios
The provision for loan losses was $1.3 million for the third quarter of 2011, compared with $9.6 million for the same period of 2010. The decline in the provision for loan losses reflected improving credit quality. Net charge-offs for the third quarter were $2.4 million, or 0.97% of average total loans on an annualized basis, compared with $15.3 million, or 5.75% of average total loans on an annualized basis, for the same period of 2010. Commercial loan charge-offs were $1.3 million for the third quarter of 2011, compared with $13.6 million in the same period of 2010. The commercial charge-offs in both periods were primarily loans in Florida. The allowance for loan losses was $18.0 million, or 1.84% of loans, excluding loans held for sale, at September 30, 2011, compared with $21.0 million, or 2.27% of loans, excluding loans held for sale, at September 30, 2010.
At September 30, 2011, nonperforming assets were $23.2 million compared with $23.8 million at June 30, 2011 and $62.5 million at September 30, 2010. Of the nonperforming assets at September 30, 2011, $10.4 million were in Florida. Nonperforming loans were $18.1 million at September 30, 2011, compared with $16.6 million at June 30, 2011, an increase of $1.5 million. The increase in nonperforming loans was due primarily to a commercial real estate loan in Texas.
Other real estate owned was $5.1 million at September 30, 2011, compared with $7.2 million at June 30, 2011, a decrease of $2.1 million, or 28.7%. The decrease was due primarily to sales of vacant land and commercial real estate. Restructured loans still accruing were $1.7 million at September 30, 2011, compared with $1.5 million at June 30, 2011.
Subsequent to September 30, we resolved $4.1 million of nonaccrual loans in Florida and $3.2 million in residential OREO in Texas. Including the effect of these transactions, our proforma nonperforming assets as of September 30, 2011 would have been $15.9 million, and our nonperforming assets to total loans and OREO would have been 1.62%.
As of September 30, 2011, our estimated Tier 1 risk-based, total risk-based and leverage capital ratios were 13.37%, 14.63%, and 9.34%, respectively. In addition, Encore Bank was considered "well capitalized" pursuant to regulatory capital definitions. Book value per common share and tangible book value per common share were $11.95 and $8.47 at September 30, 2011, compared with $12.17 and $8.72 at June 30, 2011. The decrease in book value was due mainly to the one-time non-cash charge to common equity as a result of the early redemption of CPP preferred stock. Even though the CPP preferred stock has been redeemed, the U.S. Treasury still holds warrants to acquire 364,026 of our common shares.
Conference Call
Encore will host a conference call for investors and analysts that will be broadcast live via the Internet on Friday, October 28, 2011, at 10:30 a.m. Eastern Time. Interested parties may participate by calling 877-303-6295 at least ten minutes prior to the start time.
To listen to this conference call live via the Internet, please visit the Investor Relations section of the Company's web site at http://www.encorebank.com at least fifteen minutes prior to the call to register, download and install any necessary audio software. An audio archive of the call will also be available on the web site on or before Monday, October 31, 2011.
About Encore Bancshares, Inc.
Encore Bancshares, Inc. is a financial holding company headquartered in Houston, Texas and offers a broad range of banking, wealth management and insurance services through Encore Bank, N.A., and its affiliated companies. Encore Bank operates 11 private client offices in the Greater Houston area. Headquartered in Houston and with $1.5 billion in assets, Encore Bank builds relationships with professional firms, privately-owned businesses, investors and affluent individuals. Encore Bank offers a full range of business and personal banking products and services, as well as financial planning, wealth management, trust and insurance products through its trust division, Encore Trust, and its affiliated companies, Linscomb & Williams and Town & Country Insurance. Products and services offered by Encore Bank's affiliates are not FDIC insured. The Company's common stock is listed on the NASDAQ Global Market under the symbol "EBTX".
The Encore Bancshares, Inc. logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=4257
This press release contains certain financial information determined by methods other than in accordance with GAAP. Specifically, Encore reviews tangible book value per share, return on average tangible common equity and the tangible common equity to tangible assets ratio for internal planning and forecasting purposes. Encore reviews its net interest income, net interest spread and net interest margin on a tax equivalent basis, which is standard practice in the banking industry. Encore has included in this press release information relating to these non-GAAP financial measures for the applicable periods presented. Encore's management believes these non-GAAP financial measures provide information useful to investors in understanding our financial results and believes that its presentation, together with the accompanying reconciliations, provides a complete understanding of factors and trends affecting our business and allows investors to view performance in a manner similar to management, the entire financial services sector, bank stock analysts and bank regulators. These non-GAAP measures should not be considered a substitute for operating results determined in accordance with GAAP and we strongly encourage investors to review our consolidated financial statements in their entirety and not to rely on any single financial measure. Because non-GAAP financial measures are not standardized, it may not be possible to compare these financial measures with other companies' non-GAAP financial measures having the same or similar names.
This press release contains certain forward-looking information about Encore Bancshares that is intended to be covered by the safe harbor for "forward-looking statements" provided by the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical fact are forward-looking statements. Such statements involve risks and uncertainties that may cause actual results to differ materially from those expressed in or implied by such forward-looking statements. Such risks and uncertainties include, but are not limited to: competitive pressure among financial institutions; volatility and disruption in national and international financial markets; government intervention in the U.S. financial system; our ability to expand and grow our businesses and operations and to realize the cost savings and revenue enhancements expected from such activities; a deterioration of credit quality or a reduced demand for credit; incorrect assumptions underlying the establishment of and provisions made to the allowance for loan losses; changes in the interest rate environment; the continued service of key management personnel; our ability to attract, motivate and retain key employees; the incurrence and possible impairment of goodwill associated with an acquisition and possible adverse short-term effects on our results of operations; changes in availability of funds; our ability to fully realize our net deferred tax asset; our ability to raise capital when needed; general economic conditions, either nationally, regionally or in the market areas in which we operate; legislative or regulatory developments or changes in laws; changes in the securities markets and other risks that are described from time to time in our 2010 Annual Report on Form 10-K and other reports and documents filed with the Securities and Exchange Commission.
Encore Bancshares, Inc. | Nine Greenway Plaza, Suite 1000 | Houston, Texas 77046
www.encorebank.com
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| Encore Bancshares, Inc. and Subsidiaries |
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| FINANCIAL HIGHLIGHTS |
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| (Unaudited, amounts in thousands, except per share data) |
| | | |
| | As of and for the Three | As of and for the Nine |
| | Months Ended September 30, | Months Ended September 30, |
| | 2011 | 2010 | 2011 | 2010 |
| | | | | |
| Operations Statement Data: | | | | |
| Interest income | $ 15,842 | $ 16,922 | $ 48,064 | $ 52,078 |
| Interest expense | 4,571 | 5,953 | 13,963 | 18,680 |
| Net interest income | 11,271 | 10,969 | 34,101 | 33,398 |
| Provision for loan losses | 1,265 | 9,599 | 5,354 | 32,572 |
| Net interest income after provision for loan losses | 10,006 | 1,370 | 28,747 | 826 |
| Noninterest income | 7,015 | 7,028 | 21,415 | 21,884 |
| Noninterest expense | 14,858 | 20,728 | 43,325 | 58,387 |
| Net earnings (loss) before income taxes | 2,163 | (12,330) | 6,837 | (35,677) |
| Income tax expense (benefit) | 262 | (3,904) | 1,719 | (12,347) |
| Net earnings (loss) | $ 1,901 | $ (8,426) | $ 5,118 | $ (23,330) |
| Earnings (loss) available to common shareholders (1) | $ (2,735) | $ (8,981) | $ (634) | $ (24,997) |
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| Common Share Data: | | | | |
| Basic earnings (loss) per share (2) | $ (0.23) | $ (0.79) | $ (0.05) | $ (2.25) |
| Diluted earnings (loss) per share (2) | (0.23) | (0.79) | (0.05) | (2.25) |
| Book value per share | 11.95 | 12.33 | 11.95 | 12.33 |
| Tangible book value per share (3) | 8.47 | 8.76 | 8.47 | 8.76 |
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| Average common shares outstanding | 11,658 | 11,380 | 11,577 | 11,108 |
| Diluted average common shares outstanding | 11,658 | 11,380 | 11,577 | 11,108 |
| Common shares outstanding at end of period | 11,655 | 11,380 | 11,655 | 11,380 |
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| Selected Performance Ratios: | | | | |
| Return on average assets | 0.50% | (2.01)% | 0.46% | (1.91)% |
| Return on average common equity (2) | (7.62)% | (24.02)% | (0.61)% | (21.45)% |
| Return on average tangible common equity (2)(3) | (10.64)% | (33.13)% | (0.85)% | (29.10)% |
| Taxable-equivalent net interest margin (3) | 3.20% | 2.83% | 3.37% | 2.95% |
| Efficiency ratio (4) | 80.37% | 110.27% | 76.30% | 96.06% |
| Noninterest income to total revenue | 38.36% | 39.05% | 38.57% | 39.59% |
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| (1) Includes $4,102 accelerated amortization of preferred stock discount for the three months and nine months ended September 30, 2011. |
| (2) Using earnings (loss) available to common shareholders. | | | | |
| (3) Non-GAAP measure. See calculation of tangible common equity and taxable-equivalent amounts in subsequent tables. |
| (4) Total noninterest expense (excluding intangible amortization and write down of assets held-for-sale) divided by the sum of net interest income and noninterest income (excluding gains or losses on sales of securities and gain on sale of branches). |
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| Encore Bancshares, Inc. and Subsidiaries |
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| CONSOLIDATED BALANCE SHEETS |
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| (Unaudited, dollars in thousands, except per share data) |
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| | Sept 30, | June 30, | March 31, | Dec 31, | Sept 30, |
| | 2011 | 2011 | 2011 | 2010 | 2010 |
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| ASSETS | | | | | |
| Cash and due from banks | $ 13,797 | $ 13,025 | $ 18,477 | $ 13,523 | $ 16,825 |
| Interest-bearing deposits in banks | 100,719 | 91,790 | 49,109 | 49,478 | 231,866 |
| Federal funds sold and other | 1,207 | 904 | 856 | 1,098 | 993 |
| Cash and cash equivalents | 115,723 | 105,719 | 68,442 | 64,099 | 249,684 |
| Securities available-for-sale, at fair value | 164,735 | 183,058 | 241,370 | 251,784 | 198,530 |
| Securities held-to-maturity, at amortized cost | 102,871 | 104,565 | 101,235 | 107,618 | 55,436 |
| Loans held-for-sale, at lower of cost or fair value | 7,277 | 863 | 2,913 | 10,915 | 111,505 |
| Loans receivable | 978,236 | 970,566 | 936,036 | 920,457 | 924,589 |
| Allowance for loan losses | (18,007) | (19,110) | (19,008) | (18,639) | (20,967) |
| Net loans receivable | 960,229 | 951,456 | 917,028 | 901,818 | 903,622 |
| Federal Home Loan Bank of Dallas stock, at cost | 9,820 | 9,810 | 10,206 | 9,610 | 9,602 |
| Other real estate owned | 5,135 | 7,200 | 7,311 | 9,298 | 10,852 |
| Premises and equipment, net | 6,486 | 6,545 | 6,757 | 7,023 | 7,284 |
| Cash surrender value of life insurance policies | 16,363 | 16,217 | 16,078 | 15,935 | 15,786 |
| Goodwill | 35,799 | 35,799 | 35,799 | 35,799 | 35,799 |
| Other intangible assets, net | 4,694 | 4,434 | 4,575 | 4,716 | 4,876 |
| Other assets | 40,534 | 40,829 | 46,467 | 47,882 | 44,430 |
| Other assets held-for-sale | -- | -- | -- | -- | 3,256 |
| | $ 1,469,666 | $ 1,466,495 | $ 1,458,181 | $ 1,466,497 | $ 1,650,662 |
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| LIABILITIES AND SHAREHOLDERS' EQUITY | | | | |
| Deposits: | | | | | |
| Noninterest-bearing | $ 281,981 | $ 236,873 | $ 219,629 | $ 219,756 | $ 205,927 |
| Interest-bearing | 765,715 | 806,627 | 821,163 | 830,688 | 838,125 |
| Deposits held-for-sale | -- | -- | -- | -- | 187,433 |
| Total deposits | 1,047,696 | 1,043,500 | 1,040,792 | 1,050,444 | 1,231,485 |
| Borrowings and repurchase agreements | 219,424 | 222,879 | 221,582 | 219,777 | 220,818 |
| Junior subordinated debentures | 20,619 | 20,619 | 20,619 | 20,619 | 20,619 |
| Other liabilities | 9,749 | 7,783 | 7,274 | 9,016 | 8,028 |
| Other liabilities held-for-sale | -- | -- | -- | -- | 6 |
| Total liabilities | 1,297,488 | 1,294,781 | 1,290,267 | 1,299,856 | 1,480,956 |
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| Commitments and contingencies | | | | | |
| Shareholders' equity: | | | | | |
| Preferred stock | 32,914 | 29,766 | 29,633 | 29,500 | 29,368 |
| Common stock | 11,733 | 11,733 | 11,603 | 11,479 | 11,421 |
| Additional paid-in capital | 124,250 | 123,771 | 123,329 | 122,678 | 121,939 |
| Retained earnings | 4,007 | 6,742 | 5,235 | 4,641 | 6,098 |
| Common stock in treasury, at cost | (823) | (735) | (497) | (455) | (389) |
| Accumulated other comprehensive income (loss) | 97 | 437 | (1,389) | (1,202) | 1,269 |
| Shareholders' equity | 172,178 | 171,714 | 167,914 | 166,641 | 169,706 |
| | $ 1,469,666 | $ 1,466,495 | $ 1,458,181 | $ 1,466,497 | $ 1,650,662 |
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| Ratios and Common Share Data: | | | | | |
| Leverage ratio (1) | 9.34% | 9.67% | 9.29% | 8.10% | 9.18% |
| Tier 1 risk-based capital ratio (1) | 13.37% | 13.23% | 13.05% | 12.83% | 13.53% |
| Total risk-based capital ratio (1) | 14.63% | 14.49% | 14.31% | 14.09% | 14.79% |
| Book value per common share | $ 11.95 | $ 12.17 | $ 11.97 | $ 12.00 | $ 12.33 |
| Tangible book value per common share (2) | 8.47 | 8.72 | 8.48 | 8.45 | 8.76 |
| Tangible common equity to tangible assets (2) | 6.91% | 7.13% | 6.91% | 6.78% | 6.19% |
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| (1) Estimated at September 30, 2011. | | | | | |
| (2) Non-GAAP measure. See calculation of tangible common equity in subsequent table. | | |
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| Encore Bancshares, Inc. and Subsidiaries |
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| CONSOLIDATED STATEMENTS OF OPERATIONS |
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| (Unaudited, amounts in thousands, except per share data) |
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| | Three Months Ended | Nine Months Ended |
| | Sept 30, | June 30, | March 31, | Dec 31, | Sept 30, | Septemnber 30, |
| | 2011 | 2011 | 2011 | 2010 | 2010 | 2011 | 2010 |
| Interest income: | | | | | | | |
| Loans, including fees | $ 13,966 | $ 14,254 | $ 13,442 | $ 14,646 | $ 15,408 | $ 41,662 | $ 46,543 |
| Securities | 1,714 | 2,025 | 2,305 | 1,872 | 1,276 | 6,044 | 4,848 |
| Federal funds sold and other | 162 | 104 | 92 | 207 | 238 | 358 | 687 |
| Total interest income | 15,842 | 16,383 | 15,839 | 16,725 | 16,922 | 48,064 | 52,078 |
| Interest expense: | | | | | | | |
| Deposits | 2,142 | 2,234 | 2,340 | 2,562 | 2,827 | 6,716 | 8,831 |
| Deposits held-for-sale | -- | -- | -- | 636 | 698 | -- | 2,571 |
| Borrowings and repurchase agreements | 2,131 | 2,117 | 2,106 | 2,128 | 2,127 | 6,354 | 6,382 |
| Junior subordinated debentures | 298 | 297 | 298 | 298 | 301 | 893 | 896 |
| Total interest expense | 4,571 | 4,648 | 4,744 | 5,624 | 5,953 | 13,963 | 18,680 |
| Net interest income | 11,271 | 11,735 | 11,095 | 11,101 | 10,969 | 34,101 | 33,398 |
| Provision for loan losses | 1,265 | 1,919 | 2,170 | 2,597 | 9,599 | 5,354 | 32,572 |
| Net interest income after provision for loan losses | 10,006 | 9,816 | 8,925 | 8,504 | 1,370 | 28,747 | 826 |
| Noninterest income: | | | | | | | |
| Trust and investment management fees | 4,852 | 5,126 | 5,072 | 5,122 | 4,639 | 15,050 | 13,848 |
| Insurance commissions and fees | 1,545 | 1,587 | 1,440 | 1,120 | 1,524 | 4,572 | 4,651 |
| Net gain (loss) on sale of available-for-sale securities | -- | (64) | (31) | 38 | 261 | (95) | 480 |
| Gain on sale of branches | -- | -- | -- | 2,567 | -- | -- | 1,115 |
| Other | 618 | 685 | 585 | 1,012 | 604 | 1,888 | 1,790 |
| Total noninterest income | 7,015 | 7,334 | 7,066 | 9,859 | 7,028 | 21,415 | 21,884 |
| Noninterest expense: | | | | | | | |
| Compensation | 8,464 | 8,414 | 8,706 | 8,469 | 8,503 | 25,584 | 25,692 |
| Occupancy | 1,200 | 1,128 | 1,287 | 1,339 | 1,395 | 3,615 | 4,327 |
| Equipment | 258 | 268 | 241 | 261 | 274 | 767 | 967 |
| Advertising and promotion | 107 | 156 | 156 | 137 | 146 | 419 | 480 |
| Outside data processing | 761 | 793 | 783 | 910 | 874 | 2,337 | 2,641 |
| Professional fees | 984 | 905 | 1,134 | 1,165 | 1,325 | 3,023 | 3,681 |
| Intangible amortization | 161 | 143 | 140 | 160 | 158 | 444 | 475 |
| FDIC assessment | 479 | 472 | 798 | 790 | 1,532 | 1,749 | 2,890 |
| Other real estate owned expenses, net | 1,293 | 666 | 83 | 119 | 4,458 | 2,042 | 6,984 |
| Write down of assets held-for-sale | -- | 427 | 21 | 5,744 | 1,012 | 448 | 6,340 |
| Other | 1,151 | 740 | 1,006 | 1,119 | 1,051 | 2,897 | 3,910 |
| Total noninterest expense | 14,858 | 14,112 | 14,355 | 20,213 | 20,728 | 43,325 | 58,387 |
| Net earnings (loss) before income taxes | 2,163 | 3,038 | 1,636 | (1,850) | (12,330) | 6,837 | (35,677) |
| Income tax expense (benefit) | 262 | 973 | 484 | (950) | (3,904) | 1,719 | (12,347) |
| Net earnings (loss) | $ 1,901 | $ 2,065 | $ 1,152 | $ (900) | $ (8,426) | $ 5,118 | $ (23,330) |
| Earnings (loss) available to common shareholders (1) | $ (2,735) | $ 1,507 | $ 594 | $ (1,457) | $ (8,981) | $ (634) | $ (24,997) |
| Earnings (loss) per common share: | | | | | | | |
| Basic | $ (0.23) | $ 0.13 | $ 0.05 | $ (0.13) | $ (0.79) | $ (0.05) | $ (2.25) |
| Diluted | (0.23) | 0.13 | 0.05 | (0.13) | (0.79) | (0.05) | (2.25) |
| Average common shares outstanding | 11,658 | 11,582 | 11,491 | 11,391 | 11,380 | 11,577 | 11,108 |
| Diluted average common shares outstanding | 11,658 | 11,628 | 11,575 | 11,391 | 11,380 | 11,577 | 11,108 |
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| (1) Includes $4,102 accelerated amortization of preferred stock discount for the three months and nine months ended September 30, 2011. |
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| Encore Bancshares, Inc. and Subsidiaries |
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| AVERAGE CONSOLIDATED BALANCE SHEETS |
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| (Unaudited, dollars in thousands) |
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| | Three Months Ended |
| | Sept 30, | June 30, | March 31, | Dec 31, | Sept 30, |
| | 2011 | 2011 | 2011 | 2010 | 2010 |
| | | | | | |
| Assets: | | | | | |
| Interest-earning assets: | | | | | |
| Loans | $ 973,060 | $ 955,019 | $ 933,361 | $ 1,004,472 | $ 1,056,657 |
| Securities | 275,900 | 315,681 | 354,250 | 292,241 | 209,365 |
| Federal funds sold and other | 160,000 | 71,909 | 60,084 | 243,304 | 290,541 |
| Total interest-earning assets | 1,408,960 | 1,342,609 | 1,347,695 | 1,540,017 | 1,556,563 |
| Less: Allowance for loan losses | (19,429) | (19,219) | (18,604) | (20,433) | (27,144) |
| Noninterest-earning assets | 122,940 | 127,583 | 131,183 | 131,861 | 128,197 |
| Noninterest-earning assets held-for-sale | -- | -- | -- | 4,403 | 4,196 |
| Total assets | $ 1,512,471 | $ 1,450,973 | $ 1,460,274 | $ 1,655,848 | $ 1,661,812 |
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| Liabilities and shareholders' equity: | | | | | |
| Interest-bearing liabilities: | | | | | |
| Interest checking | $ 170,534 | $ 163,926 | $ 162,577 | $ 148,875 | $ 139,820 |
| Money market and savings | 257,040 | 269,422 | 287,029 | 298,725 | 279,084 |
| Time deposits | 364,946 | 379,721 | 379,142 | 386,634 | 410,318 |
| Interest-bearing deposits held-for-sale | -- | -- | -- | 167,869 | 171,805 |
| Total interest-bearing deposits | 792,520 | 813,069 | 828,748 | 1,002,103 | 1,001,027 |
| Borrowings and repurchase agreements | 223,258 | 223,145 | 224,792 | 220,042 | 220,068 |
| Junior subordinated debentures | 20,619 | 20,619 | 20,619 | 20,619 | 20,619 |
| Total interest-bearing liabilities | 1,036,397 | 1,056,833 | 1,074,159 | 1,242,764 | 1,241,714 |
| Noninterest-bearing liabilities: | | | | | |
| Noninterest-bearing deposits | 295,823 | 217,624 | 210,885 | 220,169 | 220,166 |
| Noninterest-bearing deposits held-for-sale | -- | -- | -- | 14,767 | 14,983 |
| Other liabilities | 7,975 | 7,225 | 8,344 | 8,019 | 7,132 |
| Other liabilities held-for-sale | -- | -- | -- | 197 | 216 |
| Total liabilities | 1,340,195 | 1,281,682 | 1,293,388 | 1,485,916 | 1,484,211 |
| Shareholders' equity: | | | | | |
| Preferred | 29,944 | 29,680 | 29,513 | 29,412 | 29,284 |
| Common | 142,332 | 139,611 | 137,373 | 140,520 | 148,317 |
| Total shareholders' equity | 172,276 | 169,291 | 166,886 | 169,932 | 177,601 |
| Total liabilities and shareholders' equity | $ 1,512,471 | $ 1,450,973 | $ 1,460,274 | $ 1,655,848 | $ 1,661,812 |
| |
| Encore Bancshares, Inc. and Subsidiaries |
| | | | | | |
| SELECTED FINANCIAL DATA |
| |
| (Unaudited, dollars in thousands) |
| | | | | | |
| | Sept 30, | June 30, | March 31, | Dec 31, | Sept 30, |
| Loan Portfolio: | 2011 | 2011 | 2011 | 2010 | 2010 |
| Commercial: | | | | | |
| Commercial | $ 194,393 | $ 194,260 | $ 164,053 | $ 147,090 | $ 138,594 |
| Commercial real estate | 185,541 | 167,973 | 168,893 | 166,043 | 154,476 |
| Real estate construction | 52,993 | 54,769 | 52,106 | 46,326 | 54,140 |
| Total commercial | 432,927 | 417,002 | 385,052 | 359,459 | 347,210 |
| Consumer: | | | | | |
| Residential real estate first lien | 201,485 | 205,171 | 205,012 | 205,531 | 207,386 |
| Residential real estate second lien | 258,020 | 262,958 | 263,286 | 269,727 | 280,245 |
| Home equity lines | 56,869 | 58,553 | 59,832 | 60,609 | 63,983 |
| Consumer other | 28,935 | 26,882 | 22,854 | 25,131 | 25,765 |
| Total consumer | 545,309 | 553,564 | 550,984 | 560,998 | 577,379 |
| Loans receivable | 978,236 | 970,566 | 936,036 | 920,457 | 924,589 |
| Loans held-for-sale | 7,277 | 863 | 2,913 | 10,915 | 111,505 |
| Total loans | $ 985,513 | $ 971,429 | $ 938,949 | $ 931,372 | $ 1,036,094 |
| | | | | | |
| Asset Quality: | | | | | |
| Nonaccrual loans - Texas (1) | $ 9,203 | $ 7,655 | $ 14,557 | $ 15,167 | $ 17,445 |
| Nonaccrual loans - Florida (1) | 8,850 | 8,897 | 13,169 | 11,310 | 34,251 |
| Total nonaccrual loans (1) | 18,053 | 16,552 | 27,726 | 26,477 | 51,696 |
| Other real estate owned - Texas | 3,589 | 4,155 | 4,226 | 4,783 | 5,762 |
| Other real estate owned - Florida | 1,546 | 3,045 | 3,085 | 4,515 | 5,090 |
| Total other real estate owned | 5,135 | 7,200 | 7,311 | 9,298 | 10,852 |
| Total nonperforming assets | $ 23,188 | $ 23,752 | $ 35,037 | $ 35,775 | $ 62,548 |
| Accruing loans past due 90 days or more | $ -- | $ -- | $ -- | $ 313 | $ -- |
| Restructured loans still accruing | $ 1,706 | $ 1,522 | $ 1,755 | $ 804 | $ 2,570 |
| | | | | | |
| Asset Quality Ratios: | | | | | |
Nonperforming assets to total loans and
other real estate owned | 2.34% | 2.43% | 3.70% | 3.80% | 5.97% |
| Nonperforming assets to total assets | 1.58% | 1.62% | 2.40% | 2.44% | 3.79% |
| Net charge-offs to average total loans | 0.97% | 0.76% | 0.78% | 1.95% | 5.75% |
Allowance for loan losses to period end
loans (excluding loans held-for-sale) | 1.84% | 1.97% | 2.03% | 2.02% | 2.27% |
Allowance for loan losses to nonaccrual
loans (excluding loans held-for-sale) (2) | 136.57% | 115.45% | 74.72% | 94.11% | 88.89% |
| | | | | | |
| Deposits: | | | | | |
| Noninterest-bearing deposits | $ 281,981 | $ 236,873 | $ 219,629 | $ 219,756 | $ 205,927 |
| Interest checking | 164,781 | 179,292 | 155,262 | 173,839 | 145,257 |
| Money market and savings | 248,009 | 252,100 | 285,612 | 278,507 | 293,381 |
| Time deposits less than $100 | 107,487 | 112,975 | 114,819 | 117,974 | 124,132 |
| Core deposits | 802,258 | 781,240 | 775,322 | 790,076 | 768,697 |
| Time deposits $100 and greater | 228,316 | 236,653 | 239,936 | 239,129 | 251,271 |
| Brokered deposits | 17,122 | 25,607 | 25,534 | 21,239 | 24,084 |
| Deposits held-for-sale | -- | -- | -- | -- | 187,433 |
| Total deposits | $ 1,047,696 | $ 1,043,500 | $ 1,040,792 | $ 1,050,444 | $ 1,231,485 |
| Assets Under Management | $ 2,682,467 | $ 2,863,293 | $ 2,855,544 | $ 2,857,390 | $ 2,732,757 |
| | | | | | |
| (1) Nonaccrual troubled debt restructurings are included in nonaccrual loans. | | | |
| (2) Excludes $4,868, $0, $2,288, $6,671 and $28,109 nonaccrual loans held-for-sale. | | | |
| |
| Encore Bancshares, Inc. and Subsidiaries |
| | | | | | |
| ALLOWANCE FOR LOAN LOSSES |
| | | | | | |
| (Unaudited, dollars in thousands) |
| | | | | | |
| | Three Months Ended |
| | Sept 30, | June 30, | March 31, | Dec 31, | Sept 30, |
| | 2011 | 2011 | 2011 | 2010 | 2010 |
| | | | | | |
| Allowance for loan losses at beginning of quarter | $ 19,110 | $ 19,008 | $ 18,639 | $ 20,967 | $ 26,675 |
| | | | | | |
| Charge-offs: | | | | | |
| Commercial: | | | | | |
| Commercial | (1) | (112) | (196) | (21) | (160) |
| Commercial real estate | (1,212) | (752) | (465) | (14) | (10,049) |
| Real estate construction | (64) | (137) | (4) | (2,329) | (3,407) |
| Total commercial | (1,277) | (1,001) | (665) | (2,364) | (13,616) |
| | | | | | |
| Consumer: | | | | | |
| Residential real estate first lien | (319) | (305) | (222) | (1,261) | (503) |
| Residential real estate second lien | (623) | (513) | (1,059) | (1,106) | (879) |
| Home equity lines | (398) | (360) | (296) | (430) | (664) |
| Consumer other | (14) | (67) | (36) | (9) | (73) |
| Total consumer | (1,354) | (1,245) | (1,613) | (2,806) | (2,119) |
| Total charge-offs | (2,631) | (2,246) | (2,278) | (5,170) | (15,735) |
| | | | | | |
| Recoveries: | | | | | |
| Commercial: | | | | | |
| Commercial | 76 | 10 | 3 | 52 | 157 |
| Commercial real estate | 2 | 141 | 12 | -- | -- |
| Real estate construction | 1 | 18 | 131 | 54 | 1 |
| Total commercial | 79 | 169 | 146 | 106 | 158 |
| | | | | | |
| Consumer: | | | | | |
| Residential real estate first lien | 90 | 41 | 223 | -- | 161 |
| Residential real estate second lien | 27 | 123 | 71 | 31 | 36 |
| Home equity lines | 28 | 23 | 19 | 80 | 11 |
| Consumer other | 39 | 73 | 18 | 28 | 62 |
| Total consumer | 184 | 260 | 331 | 139 | 270 |
| Total recoveries | 263 | 429 | 477 | 245 | 428 |
| Net charge-offs | (2,368) | (1,817) | (1,801) | (4,925) | (15,307) |
| Provision for loan losses | 1,265 | 1,919 | 2,170 | 2,597 | 9,599 |
| | | | | | |
| Allowance for loan losses at end of quarter | $ 18,007 | $ 19,110 | $ 19,008 | $ 18,639 | $ 20,967 |
| |
| Encore Bancshares, Inc. and Subsidiaries |
| | | | | | | | |
| SEGMENT OPERATIONS |
| | | | | | | | |
| (Unaudited, dollars in thousands) |
| | | | | | | | |
| | As of and for the Three Months Ended | As of and for the Nine |
| | Sept 30, | June 30, | March 31, | Dec 31, | Sept 30, | Months Ended September 30, |
| | 2011 | 2011 | 2011 | 2010 | 2010 | 2011 | 2010 |
| Banking | | | | | | | |
| Net interest income | $ 11,558 | $ 12,014 | $ 11,367 | $ 11,361 | $ 11,231 | $ 34,939 | $ 34,164 |
| Provision for loan losses | 1,265 | 1,919 | 2,170 | 2,597 | 9,599 | 5,354 | 32,572 |
| Noninterest income | 574 | 535 | 529 | 3,602 | 857 | 1,638 | 3,304 |
| Noninterest expense | 9,923 | 9,348 | 9,563 | 15,476 | 16,133 | 28,834 | 44,555 |
| Earnings (loss) before income taxes | 944 | 1,282 | 163 | (3,110) | (13,644) | 2,389 | (39,659) |
| Income tax expense (benefit) | 258 | 353 | (34) | (1,309) | (4,370) | 577 | (13,757) |
| Net earnings (loss) | $ 686 | $ 929 | $ 197 | $ (1,801) | $ (9,274) | $ 1,812 | $ (25,902) |
| Total assets at period end | $ 1,473,144 | $ 1,469,429 | $ 1,467,887 | $ 1,473,837 | $ 1,650,297 | $ 1,473,144 | $ 1,650,297 |
| | | | | | | | |
| Wealth Management | | | | | | | |
| Net interest income | $ 10 | $ 16 | $ 24 | $ 34 | $ 34 | $ 50 | $ 115 |
| Noninterest income | 4,884 | 5,132 | 5,089 | 5,130 | 4,638 | 15,105 | 13,849 |
| Noninterest expense | 3,691 | 3,523 | 3,643 | 3,612 | 3,442 | 10,857 | 10,551 |
| Earnings before income taxes | 1,203 | 1,625 | 1,470 | 1,552 | 1,230 | 4,298 | 3,413 |
| Income tax expense | 426 | 574 | 516 | 475 | 438 | 1,516 | 1,211 |
| Net earnings | $ 777 | $ 1,051 | $ 954 | $ 1,077 | $ 792 | $ 2,782 | $ 2,202 |
| Total assets at period end | $ 55,951 | $ 56,105 | $ 64,157 | $ 63,254 | $ 63,933 | $ 55,951 | $ 63,933 |
| | | | | | | | |
| Insurance | | | | | | | |
| Net interest income | $ 1 | $ 2 | $ 2 | $ 4 | $ 5 | $ 5 | $ 15 |
| Noninterest income | 1,557 | 1,667 | 1,448 | 1,127 | 1,533 | 4,672 | 4,731 |
| Noninterest expense | 1,244 | 1,241 | 1,149 | 1,125 | 1,153 | 3,634 | 3,281 |
| Earnings before income taxes | 314 | 428 | 301 | 6 | 385 | 1,043 | 1,465 |
| Income tax expense (benefit) | 111 | 150 | 106 | (12) | 134 | 367 | 513 |
| Net earnings | $ 203 | $ 278 | $ 195 | $ 18 | $ 251 | $ 676 | $ 952 |
| Total assets at period end | $ 7,923 | $ 7,370 | $ 6,827 | $ 9,095 | $ 9,063 | $ 7,923 | $ 9,063 |
| | | | | | | | |
| Other | | | | | | | |
| Net interest expense | $ (298) | $ (297) | $ (298) | $ (298) | $ (301) | $ (893) | $ (896) |
| Loss before income taxes | (298) | (297) | (298) | (298) | (301) | (893) | (896) |
| Income tax benefit | (533) | (104) | (104) | (104) | (106) | (741) | (314) |
| Net earnings (loss) | $ 235 | $ (193) | $ (194) | $ (194) | $ (195) | $ (152) | $ (582) |
| Total assets at period end | $ (67,352) | $ (66,409) | $ (80,690) | $ (79,689) | $ (72,631) | $ (67,352) | $ (72,631) |
| | | | | | | | |
| Consolidated | | | | | | | |
| Net interest income | $ 11,271 | $ 11,735 | $ 11,095 | $ 11,101 | $ 10,969 | $ 34,101 | $ 33,398 |
| Provision for loan losses | 1,265 | 1,919 | 2,170 | 2,597 | 9,599 | 5,354 | 32,572 |
| Noninterest income | 7,015 | 7,334 | 7,066 | 9,859 | 7,028 | 21,415 | 21,884 |
| Noninterest expense | 14,858 | 14,112 | 14,355 | 20,213 | 20,728 | 43,325 | 58,387 |
| Earnings (loss) before income taxes | 2,163 | 3,038 | 1,636 | (1,850) | (12,330) | 6,837 | (35,677) |
| Income tax expense (benefit) | 262 | 973 | 484 | (950) | (3,904) | 1,719 | (12,347) |
| Net earnings (loss) | $ 1,901 | $ 2,065 | $ 1,152 | $ (900) | $ (8,426) | $ 5,118 | $ (23,330) |
| Total assets at period end | $ 1,469,666 | $ 1,466,495 | $ 1,458,181 | $ 1,466,497 | $ 1,650,662 | $ 1,469,666 | $ 1,650,662 |
| |
| Encore Bancshares, Inc. and Subsidiaries |
| | | | | | | |
| TAXABLE-EQUIVALENT (TE) YIELD ANALYSIS (1) |
| | | | | | | |
| (Unaudited, dollars in thousands) |
| | | | | | | |
| | Three Months Ended September 30, |
| | 2011 | 2010 |
| | Average | Interest | Average | Average | Interest | Average |
| | Outstanding | Income/ | Yield/ | Outstanding | Income/ | Yield/ |
| | Balance | Expense | Rate | Balance | Expense | Rate |
| Assets: | | | | | | |
| Interest-earning assets: | | | | | | |
| Loans - TE yield | $ 973,060 | $ 14,012 | 5.71% | $ 1,056,657 | $ 15,466 | 5.81% |
| Securities - TE yield | 275,900 | 1,778 | 2.56% | 209,365 | 1,337 | 2.53% |
| Federal funds sold and other | 160,000 | 162 | 0.40% | 290,541 | 238 | 0.32% |
| Total interest-earning assets - TE yield | 1,408,960 | 15,952 | 4.49% | 1,556,563 | 17,041 | 4.34% |
| Less: Allowance for loan losses | (19,429) | | | (27,144) | | |
| Noninterest-earning assets | 122,940 | | | 128,197 | | |
| Noninterest-earning assets held-for-sale | -- | | | 4,196 | | |
| Total assets | $ 1,512,471 | | | $ 1,661,812 | | |
| | | | | | | |
| Liabilities and shareholders' equity: | | | | | | |
| Interest-bearing liabilities: | | | | | | |
| Interest checking | $ 170,534 | $ 66 | 0.15% | $ 139,820 | $ 90 | 0.26% |
| Money market and savings | 257,040 | 179 | 0.28% | 279,084 | 442 | 0.63% |
| Time deposits | 364,946 | 1,897 | 2.06% | 410,318 | 2,295 | 2.22% |
| Interest-bearing deposits held-for-sale | -- | -- | | 171,805 | 698 | 1.61% |
| Total interest-bearing deposits | 792,520 | 2,142 | 1.07% | 1,001,027 | 3,525 | 1.40% |
| Borrowings and repurchase agreements | 223,258 | 2,131 | 3.79% | 220,068 | 2,127 | 3.83% |
| Junior subordinated debentures | 20,619 | 298 | 5.73% | 20,619 | 301 | 5.79% |
| Total interest-bearing liabilities | 1,036,397 | 4,571 | 1.75% | 1,241,714 | 5,953 | 1.90% |
| Noninterest-bearing liabilities: | | | | | | |
| Noninterest-bearing deposits | 295,823 | | | 220,166 | | |
| Noninterest-bearing deposits held-for-sale | -- | | | 14,983 | | |
| Other liabilities | 7,975 | | | 7,132 | | |
| Other liabilities held-for-sale | -- | | | 216 | | |
| Total liabilities | 1,340,195 | | | 1,484,211 | | |
| Shareholders' equity | 172,276 | | | 177,601 | | |
| Total liabilities and shareholders' equity | $ 1,512,471 | | | $ 1,661,812 | | |
| | | | | | | |
| Net interest income - TE | | $ 11,381 | | | $ 11,088 | |
| | | | | | | |
| Net interest spread - TE | | | 2.74% | | | 2.44% |
| Net interest margin - TE | | | 3.20% | | | 2.83% |
| | | | | | | |
| (1) Non-GAAP measure. See calculation of taxable-equivalent amounts in subsequent table. | | | |
| |
| Encore Bancshares, Inc. and Subsidiaries |
| | | | | | | |
| TAXABLE-EQUIVALENT (TE) YIELD ANALYSIS (1) |
| | | | | | | |
| (Unaudited, dollars in thousands) |
| | | | | | | |
| | Nine Months Ended September 30, |
| | 2011 | 2010 |
| | Average | Interest | Average | Average | Interest | Average |
| | Outstanding | Income/ | Yield/ | Outstanding | Income/ | Yield/ |
| | Balance | Expense | Rate | Balance | Expense | Rate |
| Assets: | | | | | | |
| Interest-earning assets: | | | | | | |
| Loans - TE yield | $ 953,959 | $ 41,811 | 5.86% | $ 1,060,214 | $ 46,731 | 5.89% |
| Securities - TE yield | 314,990 | 6,234 | 2.65% | 208,767 | 5,029 | 3.22% |
| Federal funds sold and other | 97,697 | 358 | 0.49% | 262,161 | 687 | 0.35% |
| Total interest-earning assets - TE yield | 1,366,646 | 48,403 | 4.74% | 1,531,142 | 52,447 | 4.58% |
| Less: Allowance for loan losses | (19,087) | | | (26,206) | | |
| Noninterest-earning assets | 127,205 | | | 125,579 | | |
| Noninterest-earning assets held-for-sale | -- | | | 5,340 | | |
| Total assets | $ 1,474,764 | | | $ 1,635,855 | | |
| | | | | | | |
| Liabilities and shareholders' equity: | | | | | | |
| Interest-bearing liabilities: | | | | | | |
| Interest checking | $ 165,708 | $ 238 | 0.19% | $ 146,185 | $ 325 | 0.30% |
| Money market and savings | 271,054 | 762 | 0.38% | 252,601 | 1,395 | 0.74% |
| Time deposits | 374,551 | 5,716 | 2.04% | 408,831 | 7,111 | 2.33% |
| Interest-bearing deposits held-for-sale | -- | -- | | 197,668 | 2,571 | 1.74% |
| Total interest-bearing deposits | 811,313 | 6,716 | 1.11% | 1,005,285 | 11,402 | 1.52% |
| Borrowings and repurchase agreements | 223,726 | 6,354 | 3.80% | 219,871 | 6,382 | 3.88% |
| Junior subordinated debentures | 20,619 | 893 | 5.79% | 20,619 | 896 | 5.81% |
| Total interest-bearing liabilities | 1,055,658 | 13,963 | 1.77% | 1,245,775 | 18,680 | 2.00% |
| Noninterest-bearing liabilities: | | | | | | |
| Noninterest-bearing deposits | 241,755 | | | 178,591 | | |
| Noninterest-bearing deposits held-for-sale | -- | | | 16,667 | | |
| Other liabilities | 7,847 | | | 9,612 | | |
| Other liabilities held-for-sale | -- | | | 257 | | |
| Total liabilities | 1,305,260 | | | 1,450,902 | | |
| Shareholders' equity | 169,504 | | | 184,953 | | |
| Total liabilities and shareholders' equity | $ 1,474,764 | | | $ 1,635,855 | | |
| | | | | | | |
| Net interest income - TE | | $ 34,440 | | | $ 33,767 | |
| | | | | | | |
| Net interest spread - TE | | | 2.97% | | | 2.58% |
| Net interest margin - TE | | | 3.37% | | | 2.95% |
| | | | | | | |
| (1) Non-GAAP measure. See calculation of taxable-equivalent amounts in subsequent table. | | | |
| |
| Encore Bancshares, Inc. and Subsidiaries |
| | | | | | |
| NON-GAAP FINANCIAL MEASURES |
| | | | | | |
| (Unaudited, amounts in thousands) |
| | | | | | |
| | Sept 30, | June 30, | March 31, | Dec 31, | Sept 30, |
| | 2011 | 2011 | 2011 | 2010 | 2010 |
| | | | | | |
| Shareholders' equity (GAAP) | $ 172,178 | $ 171,714 | $ 167,914 | $ 166,641 | $ 169,706 |
| Less: Preferred stock | 32,914 | 29,766 | 29,633 | 29,500 | 29,368 |
| Goodwill and other intangible assets, net | 40,493 | 40,233 | 40,374 | 40,515 | 40,675 |
| Tangible common equity (1) | $ 98,771 | $ 101,715 | $ 97,907 | $ 96,626 | $ 99,663 |
| | | | | | |
| Total assets (GAAP) | $ 1,469,666 | $ 1,466,495 | $ 1,458,181 | $ 1,466,497 | $ 1,650,662 |
| Less: Goodwill and other intangible assets, net | 40,493 | 40,233 | 40,374 | 40,515 | 40,675 |
| Tangible assets | $ 1,429,173 | $ 1,426,262 | $ 1,417,807 | $ 1,425,982 | $ 1,609,987 |
| | | | | | |
| Common shares outstanding at end of period | 11,655 | 11,663 | 11,552 | 11,431 | 11,380 |
| | | | | | |
| (1) Tangible common equity, a non-GAAP financial measure, includes total equity, less preferred equity, goodwill and other intangible assets. Management reviews tangible common equity along with other measures of capital as part of its financial analyses and has included this information because of current interest on the part of market participants in tangible common equity as a measure of capital. The methodology of determining tangible common equity may differ among companies. |
| | | | | | |
| | Three Months Ended | | Nine Months Ended |
| | September 30, | | September 30, |
| | 2011 | 2010 | | 2011 | 2010 |
| Net interest income (GAAP) | $ 11,271 | $ 10,969 | | $ 34,101 | $ 33,398 |
| Taxable-equivalent adjustment (1) | 110 | 119 | | 339 | 369 |
| Net interest income on a taxable-equivalent basis | $ 11,381 | $ 11,088 | | $ 34,440 | $ 33,767 |
| | | | | | |
| (1) Net interest income, net interest spread and net interest margin are reported on a taxable-equivalent basis. The taxable-equivalent adjustment to net interest income recognizes the income tax savings when comparing taxable and tax-exempt assets. Management believes that it is a standard practice in the banking industry to present net interest income, net interest spread and net interest margin on a fully taxable-equivalent basis. Management believes these measures provide useful information to investors by allowing them to make peer comparisons. |
CONTACT: L. Anderson Creel
Chief Financial Officer
713.787.3138
James S. D'Agostino, Jr.
Chairman and CEO
713.787.3103