FOR IMMEDIATE RELEASE
Date: July 23, 2009
Contacts: Kevin T. Bottomley L. Mark Panella
President and CEO Executive Vice President and CFO
Phone: (978) 739-0263 (978) 739-0217
Email: kevin.bottomley@danversbank.com mark.panella@danversbank.com
Danvers Bancorp, Inc. Reports Results for the Three and Six Months Ended June 30, 2009
DANVERS, MASSACHUSETTS (July 23, 2009): Danvers Bancorp, Inc. (the “Company”) (NASDAQ: DNBK), the holding company for Danversbank (the “Bank”), today reported net income of $135,000 for the quarter ended June 30, 2009 compared to $542,000 for the same quarter in 2008. Higher deposit insurance premiums related to the FDIC’S special assessment, higher provision for loan losses and transaction expenses associated with the proposed Beverly National Corporation acquisition more than offset measurable increases in net interest income and non-interest income for the second quarter. In particular, net interest income improved by $945,000, or 7.8%, compared to the same period in 2008.
For the six months ended June 30, 2009, the Company recorded net income of $1.5 million compared to a net loss of $2.7 million for the same time period in 2008. Lower non-interest expense and an increase in net interest income were somewhat offset by lower non-interest income and a higher provision for loan losses between the two periods. The loss for the first six months of 2008 was due primarily to two non-recurring items; a $6.9 million pretax charge related to the establishment of the Danversbank Charitable Foundation (the ‘‘Foundation”) and a $3.7 million pretax charge related to the acceleration of the Company’s phantom stock plan. Both charges are directly related to the Company’s conversion in January 2008 from a mutual form of organization to a public stock holding company.
Compared to the quarter ended March 31, 2009, net income decreased to $135,000 from net income of $1.4 million. Increases in the provision for loan losses, the FDIC’s special deposit insurance assessment, and transaction expenses associated with the proposed Beverly National Corporation acquisition, were the primary reasons for the decline.
Second quarter financial highlights include:
| | · | 13% annualized growth in gross loans; |
| | · | 33% annualized growth in total deposits; |
| | · | Non-performing assets to total assets of 0.79% compared to 0.71% for Q2 ‘08 and 0.55% for Q1 ‘09; |
| | · | Net interest margin of 3.13% compared to 3.38% for Q2 ‘08 and 3.06% for Q1 ‘09; |
| | · | Net interest income increased 8% compared to Q2 ‘08; |
| | · | Net interest income increased 4% compared to Q1 ‘09; |
| | · | Non-interest income increased 10% compared to Q2 ‘08; and |
| | · | Non-interest income increased 4% compared to Q1 ‘09. |
“We were pleased by the continued strong growth in our deposits and the modest improvement of seven basis points in our net interest margin,” stated Kevin T. Bottomley, President and CEO.
Earnings per share basic and diluted for the second quarter of 2009 and 2008 were $0.01 and $0.03, respectively. Earnings per share basic and diluted for the six months ended June 30, 2009 were $0.09. Earnings per share are not applicable for year to date and quarterly periods prior to June 30, 2008 as the Company did not issue stock until January 10, 2008.
Merger
On June 16, 2009, the Company entered into a merger agreement with Beverly National Corporation. The Agreement and Plan of Merger with Beverly National Corporation provides for the proposed merger of Beverly National Corporation with and into the Company. Consummation of the merger is subject to a number of customary conditions including the receipt of all necessary regulatory and shareholder approvals.
Dividend Declared
The Board of Directors of the Company has declared a cash dividend on its common stock of $0.02 per share. The dividend will be paid on or after August 21, 2009 to shareholders of record as of August 7, 2009.
2009 Earnings Summary
The Company’s net interest income increased by $945,000, or 7.8%, during the second quarter of 2009 compared with the same period in 2008. For the comparable six month period ended June 30, 2009, net interest income increased $2.9 million. These increases were attributable to the Company’s significant loan growth during the comparable three and six month periods. Net loans increased $42.4 million during the quarter and $68.9 million for the six months ended June 30, 2009. In addition, total interest expense declined by $1.8 million between the comparable six month periods. The Company’s net interest income, during the second quarter of 2009, increased $553,000, or 4.4%, when compared to the first quarter of 2009. The Company’s net interest margin (“NIM”) was 3.13% for the quarter ended June 30, 2009, a 25 basis point decrease when compared to the second quarter of 2008, and a 7 basis point increase when compared to the first quarter of 2009.
Non-interest income for the second quarter of 2009 totaled $1.8 million, an increase of $168,000, or 10.3%, compared to the second quarter of 2008. Increases in gains on sales of loans and service charges on deposits were offset by decreases in gains on sales of securities and income on bank-owned life insurance during the period. For the six months ended June 30, 2009, non-interest income decreased by $379,000, or 9.7%, compared to the same period in 2008. Decreases in loan servicing revenue and the absence of gains from securities sales were slightly offset by increases in gains on sales of loans and service charges on deposits. Non-interest income improved slightly by $65,000 for the second quarter when compared to the first quarter of 2009, due primarily to an increase in service charges on deposits.
Non-interest expense increased by $2.9 million, or 26.7%, for the second quarter of 2009 as compared to the same period in 2008. The Company experienced increases in salaries and employee benefits, deposit insurance, outside services, occupancy and other operating expense during the second quarter. Deposit insurance increased by $1.1 million and was impacted by generally higher insurance premiums that included a special assessment of $810,000. The increase in salaries and employee benefits during the quarter was the result of additions to staff as the Company continues to expand its branch footprint and lending activities and general salary administration related to the expansion of the franchise since conversion. These increases were partially offset by a decrease in other real estate owned expense of $721,000. Non-interest expense increased by $1.8 million for the second quarter when compared to the first quarter of 2009. This included increases in deposit insurance expense, outside services, salaries and employee benefits and other operating expense of $808,000, $326,000, $275,000 and $418,000, respectively. These increases were offset by a decrease in occupancy expense of $126,000. Included in the increase in outside services expense are $240,000 in transaction expenses associated with the proposed Beverly National Corporation transaction.
For the first six months of 2009, the Company’s overall non-interest expenses declined $7.0 million when compared to 2008 as a result of the aforementioned charges for the Charitable Foundation, accelerated vesting and payout of the phantom stock plan as well as a $1.4 million decline in other real estate owned expense.
Balance Sheet Summary
Total assets increased by $79.5 million, or 4.6%, from $1,727.8 million at December 31, 2008 to $1,807.3 million at June 30, 2009. Net loans have increased by $68.9 million, or 6.2%, during the first six months of the year. During the same time period, securities have decreased $49.3 million, or 10.0%. This change in the Company’s asset mix is the combination of cash flow from the Company’s investment portfolio and the credit opportunities that continue to present themselves in the Company’s primary markets. During the fourth quarter of 2008, management chose to purchase a number of callable agency securities that were directly funded with overnight FHLB borrowings. Over the past six months, the Company has experienced steady cash flow from both investment calls and amortization from the mortgage-backed securities portfolio and as a result management has been able to fund the majority of the Company’s loan origination activities with this cash flow. The Company has also experienced very strong deposit growth during the first six months of 2009 and has utilized these cash flows to fund the balance of its loan originations and retire overnight borrowings. Deposit balances increased by $182.1 million, or 16.3%, for the first six months of 2009. Total borrowings decreased by $94.2 million during the same period.
The Company continued to experience strong loan demand during the second quarter of 2009. The major increases occurred in the commercial real estate and C&I loan segments with growth of $23.2 million and $11.3 million, respectively. Gross loans have increased $70 million for the first six months of the year.
“Loan growth during the second quarter remained robust. We believe that the same underlying conditions will continue to present us with excellent opportunities to expand our portfolio with strong and diversified credits,” noted Bottomley.
The Company experienced some deterioration in its asset quality metrics for the quarter ended June 30, 2009. Non-performing assets as a percentage of total assets increased to 79 basis points, up from 55 basis points at March 31, 2009 and 41 basis points at December 31, 2008. Non-performing assets were 71 basis points at June 30, 2008. Non-performing assets totaled $14.2 million at June 30, 2009, and were composed of $8.9 million in loans that are considered impaired and on non accrual, $3.6 million in troubled debt restructures (TDR’s) and $1.7 million in other real estate owned (OREO).
All of the credits classified as TDR’s were performing in accordance with their modified terms and conditions at June 30, 2009. Of the total OREO balance, $1.6 million represents one lending relationship that has been reduced from a non-performing loan balance of $2.6 million prior to being transferred into OREO. The remainder of the impaired loan balances are fairly evenly split between commercial and residential credits with no particular business segment or industry concentration.
In general, the trends associated with the Company’s asset quality measures are a reflection of some of the challenges in both the local and national economy and despite some of the migration to non-performing status, the Company’s delinquency trends continue to be stable and favorable when compared to industry peers. Total loans 30-89 days past due have actually declined between the first and second quarter of 2009. The second quarter provision for loan losses was $1.2 million compared to $1.1 million for the same period in 2008 and $760,000 when compared to the first quarter of 2009. The growth of the loan portfolio and to a lesser extent the establishment of specific reserves were the primary reasons for the increase. The allowance for loan losses increased by $174,000, or 1.4%, during the second quarter of 2009 and represented 1.07% of loans at June 30, 2009 compared to 1.08% at December 31, 2008. The allowance represents 101.41% of non-performing loans at June 30, 2009.
Deposits increased by $182.1 million, or 16.3%, to $1,300.4 million at June 30, 2009 compared to $1,118.3 million at December 31, 2008. For the first six months, the Company has experienced increases in all deposit categories and through a number of deposit gathering channels. This includes, but is not limited to, certain online and electronic banking initiatives and the continued expansion of the Company’s branch footprint. In addition, the franchise continues to benefit from the current rate environment and steady flow of deposit balances from some of the larger banking franchises to the community institutions. Despite the low levels of short-term interest rates, the Company has experienced considerable success at raising “core” deposit balances.
Advances from the Federal Home Loan Bank of Boston (FHLBB) decreased by $139.8 million, or 46.3%, at June 30, 2009 compared to December 31, 2008. Management chose to replace the Company’s overnight borrowing with the aforementioned deposit inflows and in the process has lessened the Company’s immediate reliance on the FHLBB for short-term funding. The Company still had approximately $162 million in various longer term advances with the FHLBB at June 30. The Company also chose to expand its funding alternatives by borrowing from the Federal Reserve Bank (FRB) Discount Window via the FRB’s Term Auction Facility (“TAF”). The Company borrowed $45.0 million in 84-day TAF funding in April 2009 at a highly competitive overnight rate.
Company Profile
Danvers Bancorp, Inc. is the holding company for Danversbank, a Massachusetts-chartered savings bank headquartered in Danvers, Massachusetts. Originally founded in 1850 as a Massachusetts-chartered mutual savings bank, we have grown to $1.8 billion in assets through acquisitions and internal growth, including de novo branching. We conduct business from our main office located at One Conant Street, Danvers, Massachusetts, and our 16 other branch offices located in Andover, Beverly, Boston, Cambridge, Chelsea, Danvers, Malden, Middleton, Peabody, Reading, Revere, Salem, Saugus, Wilmington, and Woburn, Massachusetts. Our business consists primarily of making loans to our customers, including commercial and industrial, commercial real estate loans, owner-occupied residential mortgages and consumer loans, and investing in a variety of investment securities. We fund these lending and investment activities with deposits from our customers; funds generated from operations and selected borrowings. We also provide non-deposit investment products and services, cash management, debit and credit card products and online banking services. Additional information about the Company and its subsidiaries is available at www.danversbank.com.
Forward Looking Statements
Certain statements herein constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on the beliefs and expectations of management, as well as the assumptions made using information currently available to management. Since these statements reflect the views of management concerning future events, these statements involve risks, uncertainties and assumptions. As a result, actual results may differ from those contemplated by these statements. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. They often include words like “believe,” “expect,” “anticipate,” “estimate,’ and “intend” or future or conditional verbs such as “will,” “would,” “should,” “could,” or “may.” Certain factors that could cause actual results to differ materially from expected results include changes in the interest rate environment, changes in general economic conditions, legislative and regulatory changes and the risk factors described in the Company’s December 31, 2008 Form 10-K, issued March 16, 2009, as updated by our Quarterly Reports on Form 10-Q, that adversely affect the business in which Danvers Bancorp is engaged and changes in the securities market. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this release and the associated conference call. The Company disclaims any intent or obligation to update any forward-looking statements, whether in response to new information, future events or otherwise.
DANVERS BANCORP, INC.
CONSOLIDATED BALANCE SHEETS
(Unaudited)
| | | June 30, | | | December 31, | |
| | | 2009 | | | 2008 | |
| | | (In thousands) | |
| ASSETS | |
| Cash and cash equivalents | | $ | 87,612 | | | $ | 33,129 | |
| Certificates of deposit | | | 10,499 | | | | 10,291 | |
| Securities available for sale, at fair value | | | 441,569 | | | | 490,845 | |
| Loans held for sale | | | 1,428 | | | | - | |
| Loans | | | 1,188,419 | | | | 1,118,948 | |
| Less allowance for loan losses | | | (12,719 | ) | | | (12,133 | ) |
| Loans, net | | | 1,175,700 | | | | 1,106,815 | |
| | | | | | | | | |
| Federal Home Loan Bank stock, at cost | | | 14,001 | | | | 14,001 | |
| Premises and equipment, net | | | 26,578 | | | | 22,877 | |
| Bank-owned life insurance | | | 25,148 | | | | 24,826 | |
| Other real estate owned | | | 1,674 | | | | 1,158 | |
| Accrued interest receivable | | | 6,928 | | | | 7,457 | |
| Deferred tax asset, net | | | 9,308 | | | | 6,955 | |
| Other assets | | | 6,892 | | | | 9,455 | |
| | | $ | 1,807,337 | | | $ | 1,727,809 | |
| | | | | | | | | |
| LIABILITIES AND STOCKHOLDERS' EQUITY | |
| Deposits: | | | | | | | | |
| Demand deposits | | $ | 144,952 | | | $ | 123,414 | |
| Savings and NOW accounts | | | 206,980 | | | | 176,365 | |
| Money market accounts | | | 500,145 | | | | 440,931 | |
| Term certificates over $100,000 | | | 278,112 | | | | 242,846 | |
| Other term certificates | | | 170,250 | | | | 134,727 | |
| Total deposits | | | 1,300,439 | | | | 1,118,283 | |
| Short-term borrowings | | | 74,822 | | | | 168,276 | |
| Long-term debt | | | 162,254 | | | | 163,022 | |
| Subordinated debt | | | 29,965 | | | | 29,965 | |
| Accrued expenses and other liabilities | | | 14,594 | | | | 15,255 | |
| Total liabilities | | | 1,582,074 | | | | 1,494,801 | |
| Stockholders' equity: | | | | | | | | |
| Preferred stock; $0.01 par value, 10,000,000 shares authorized; | | | | | | | | |
| none issued and outstanding | | | - | | | | - | |
| Common stock, $0.01 par value, 60,000,000 shares authorized; 17,842,500 shares | | | | | | | | |
| issued and 17,128,800 shares outstanding at June 30, 2009 and 17,842,500 | | | | | | | | |
| shares issued and outstanding at December 31, 2008 | | | 178 | | | | 178 | |
| Additional paid-in capital | | | 173,772 | | | | 174,510 | |
| Retained earnings | | | 68,722 | | | | 67,854 | |
| Accumulated other comprehensive income | | | 3,418 | | | | 4,026 | |
| Unearned restricted shares | | | (7,624 | ) | | | - | |
| Unearned compensation - ESOP, 1,320,345 shares and 1,356,030 shares at | | | | | | | | |
| June 30, 2009 and December 31, 2008, respectively | | | (13,203 | ) | | | (13,560 | ) |
| Total stockholders' equity | | | 225,263 | | | | 233,008 | |
| | | $ | 1,807,337 | | | $ | 1,727,809 | |
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
| | | Three Months Ended | | | Six Months Ended | |
| | | June 30, | | | June 30, | |
| | | 2009 | | | 2008 | | | 2009 | | | 2008 | |
| | | (Dollars in thousands, except per share amounts) | |
| Interest and dividend income: | | | | | | | | | | | | |
| Interest and fees on loans | | $ | 16,612 | | | $ | 15,798 | | | $ | 32,319 | | | $ | 31,418 | |
| Interest on debt securities: | | | | | | | | | | | | | | | | |
| Taxable | | | 5,096 | | | | 4,888 | | | | 10,518 | | | | 9,680 | |
| Non-taxable | | | 220 | | | | 194 | | | | 423 | | | | 383 | |
| Dividends on equity securities | | | 1 | | | | 102 | | | | 1 | | | | 210 | |
| Interest on cash equivalents and certificates of deposit | | | 98 | | | | 155 | | | | 195 | | | | 683 | |
| Total interest and dividend income | | | 22,027 | | | | 21,137 | | | | 43,456 | | | | 42,374 | |
| | | | | | | | | | | | | | | | | |
| Interest expense: | | | | | | | | | | | | | | | | |
| Interest on deposits: | | | | | | | | | | | | | | | | |
| Savings and NOW accounts | | | 647 | | | | 551 | | | | 1,195 | | | | 1,211 | |
| Money market accounts | | | 2,960 | | | | 2,695 | | | | 5,883 | | | | 6,024 | |
| Term certificates | | | 3,004 | | | | 3,321 | | | | 6,031 | | | | 7,594 | |
| Interest on short-term borrowings | | | 79 | | | | 198 | | | | 207 | | | | 319 | |
| Interest on long-term debt and subordinated debt | | | 2,303 | | | | 2,283 | | | | 4,625 | | | | 4,612 | |
| Total interest expense | | | 8,993 | | | | 9,048 | | | | 17,941 | | | | 19,760 | |
| Net interest income | | | 13,034 | | | | 12,089 | | | | 25,515 | | | | 22,614 | |
| Provision for loan losses | | | 1,200 | | | | 1,075 | | | | 1,960 | | | | 1,675 | |
| Net interest income, after provision for loan losses | | | 11,834 | | | | 11,014 | | | | 23,555 | | | | 20,939 | |
| | | | | | | | | | | | | | | | | |
| Non-interest income: | | | | | | | | | | | | | | | | |
| Service charges on deposits | | | 846 | | | | 656 | | | | 1,634 | | | | 1,286 | |
| Loan servicing fees | | | 19 | | | | 52 | | | | 29 | | | | 111 | |
| Gain on sales of loans | | | 344 | | | | 35 | | | | 685 | | | | 96 | |
| Gain on sales of other real estate owned | | | - | | | | - | | | | 29 | | | | - | |
| Net gain on sales of securities | | | - | | | | 141 | | | | - | | | | 913 | |
| Net increase in cash surrender value of bank-owned life insurance | | | 185 | | | | 241 | | | | 322 | | | | 600 | |
| Other operating income | | | 409 | | | | 510 | | | | 842 | | | | 914 | |
| Total non-interest income | | | 1,803 | | | | 1,635 | | | | 3,541 | | | | 3,920 | |
| | | | | | | | | | | | | | | | | |
| Non-interest expenses: | | | | | | | | | | | | | | | | |
| Salaries and employee benefits | | | 7,248 | | | | 5,604 | | | | 14,221 | | | | 15,640 | |
| Occupancy | | | 1,378 | | | | 1,185 | | | | 2,882 | | | | 2,495 | |
| Equipment | | | 819 | | | | 794 | | | | 1,587 | | | | 1,547 | |
| Outside services | | | 569 | | | | 269 | | | | 812 | | | | 551 | |
| Contribution to the Danversbank Charitable Foundation | | | - | | | | - | | | | - | | | | 6,850 | |
| Other real estate owned expense | | | 171 | | | | 892 | | | | 296 | | | | 1,686 | |
| Deposit insurance expense | | | 1,254 | | | | 191 | | | | 1,700 | | | | 342 | |
| Other operating expense | | | 2,160 | | | | 1,801 | | | | 3,902 | | | | 3,282 | |
| Total non-interest expenses | | | 13,599 | | | | 10,736 | | | | 25,400 | | | | 32,393 | |
| Income (loss) before income taxes | | | 38 | | | | 1,913 | | | | 1,696 | | | | (7,534 | ) |
| Provision (benefit) for income taxes | | | (97 | ) | | | 1,371 | | | | 178 | | | | (4,820 | ) |
| Net income (loss) | | $ | 135 | | | $ | 542 | | | $ | 1,518 | | | $ | (2,714 | ) |
| | | | | | | | | | | | | | | | | |
| Weighted-average shares outstanding: | | | | | | | | | | | | | | | | |
| Basic | | | 15,949,439 | | | | 16,433,139 | | | | 16,161,734 | | | | N/A | |
| Diluted | | | 16,011,626 | | | | 16,433,139 | | | | 16,193,583 | | | | N/A | |
| | | | | | | | | | | | | | | | | |
| Earnings per share: | | | | | | | | | | | | | | | | |
| Basic | | $ | 0.01 | | | $ | 0.03 | | | $ | 0.09 | | | | N/A | |
| Diluted | | $ | 0.01 | | | $ | 0.03 | | | $ | 0.09 | | | | N/A | |
DANVERS BANCORP, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
| | | Three Months Ended | |
| | | June 30, | | | March 31, | |
| | | 2009 | | | 2009 | |
| | | (Dollars in thousands, | |
| | | except per share amounts) | |
| Interest and dividend income: | | | | | | |
| Interest and fees on loans | | $ | 16,612 | | | $ | 15,707 | |
| Interest on debt securities: | | | | | | | | |
| Taxable | | | 5,096 | | | | 5,422 | |
| Non-taxable | | | 220 | | | | 203 | |
| Dividends on equity securities | | | 1 | | | | - | |
| Interest on cash equivalents and certificates of deposit | | | 98 | | | | 97 | |
| Total interest and dividend income | | | 22,027 | | | | 21,429 | |
| | | | | | | | | |
| Interest expense: | | | | | | | | |
| Interest on deposits: | | | | | | | | |
| Savings and NOW accounts | | | 647 | | | | 548 | |
| Money market accounts | | | 2,960 | | | | 2,923 | |
| Term certificates | | | 3,004 | | | | 3,027 | |
| Interest on short-term borrowings | | | 79 | | | | 128 | |
| Interest on long-term debt and subordinated debt | | | 2,303 | | | | 2,322 | |
| Total interest expense | | | 8,993 | | | | 8,948 | |
| Net interest income | | | 13,034 | | | | 12,481 | |
| Provision for loan losses | | | 1,200 | | | | 760 | |
| Net interest income, after provision for loan losses | | | 11,834 | | | | 11,721 | |
| | | | | | | | | |
| Non-interest income: | | | | | | | | |
| Service charges on deposits | | | 846 | | | | 788 | |
| Loan servicing fees | | | 19 | | | | 10 | |
| Gain on sales of loans | | | 344 | | | | 341 | |
| Gain on sales of other real estate owned | | | - | | | | 29 | |
| Net gain on sales of securities | | | - | | | | - | |
| Net increase in cash surrender value of bank-owned life insurance | | | 185 | | | | 136 | |
| Other operating income | | | 409 | | | | 434 | |
| Total non-interest income | | | 1,803 | | | | 1,738 | |
| | | | | | | | | |
| Non-interest expenses: | | | | | | | | |
| Salaries and employee benefits | | | 7,248 | | | | 6,973 | |
| Occupancy | | | 1,378 | | | | 1,504 | |
| Equipment | | | 819 | | | | 768 | |
| Outside services | | | 569 | | | | 243 | |
| Other real estate owned expense | | | 171 | | | | 125 | |
| Deposit insurance expense | | | 1,254 | | | | 446 | |
| Other operating expense | | | 2,160 | | | | 1,742 | |
| Total non-interest expenses | | | 13,599 | | | | 11,801 | |
| Income before income taxes | | | 38 | | | | 1,658 | |
| Provision (benefit) for income taxes | | | (97 | ) | | | 275 | |
| Net income | | $ | 135 | | | $ | 1,383 | |
| | | | | | | | | |
| Weighted-average shares outstanding: | | | | | | | | |
| Basic | | | 15,949,439 | | | | 16,376,388 | |
| Diluted | | | 16,011,626 | | | | 16,383,254 | |
| | | | | | | | | |
| Earnings per share: | | | | | | | | |
| Basic | | $ | 0.01 | | | $ | 0.08 | |
| Diluted | | $ | 0.01 | | | $ | 0.08 | |
NET INTEREST INCOME ANALYSIS
(Unaudited)
| | | | | | | | | | | | | | | | | | | |
| | | Three Months Ended June 30, | |
| | | 2009 | | | 2008 | |
| | | Average | | | Interest | | | Average | | | Average | | | Interest | | | Average | |
| | | Outstanding | | | Earned/ | | | Yield/ | | | Outstanding | | | Earned/ | | | Yield/ | |
| | | Balance | | | Paid | | | Rate (1) | | | Balance | | | Paid | | | Rate (1) | |
| | | (Dollars in thousands) | |
| Interest-earning assets: | | | | | | | | | | | | | | | | | | |
| Interest-earning cash equivalents and | | | | | | | | | | | | | | | | | | |
| certificates of deposit | | $ | 42,563 | | | $ | 98 | | | | 0.92 | % | | $ | 19,933 | | | $ | 155 | | | | 3.11 | % |
| Debt securities: (2) | | | | | | | | | | | | | | | | | | | | | | | | |
| U.S. Government | | | 520 | | | | 3 | | | | 2.31 | | | | 2,083 | | | | 22 | | | | 4.22 | |
| Gov't-sponsored enterprises and | | | | | | | | | | | | | | | | | | | | | | | | |
| FHLMC | | | 188,332 | | | | 2,311 | | | | 4.91 | | | | 174,698 | | | | 2,112 | | | | 4.84 | |
| Mortgage-backed | | | 234,042 | | | | 2,780 | | | | 4.75 | | | | 221,759 | | | | 2,750 | | | | 4.96 | |
| Municipal bonds | | | 21,692 | | | | 220 | | | | 4.06 | | | | 19,068 | | | | 194 | | | | 4.07 | |
| Other | | | 250 | | | | 2 | | | | 3.20 | | | | 307 | | | | 4 | | | | 5.21 | |
| Equity securities | | | 14,626 | | | | 1 | | | | 0.30 | | | | 11,366 | | | | 102 | | | | 3.59 | |
| Real estate mortgages (3) | | | 636,246 | | | | 8,905 | | | | 5.60 | | | | 571,348 | | | | 9,035 | | | | 6.33 | |
| C&I loans (3) | | | 441,482 | | | | 6,599 | | | | 5.98 | | | | 351,522 | | | | 5,952 | | | | 6.77 | |
| IRBs (3) | | | 81,037 | | | | 966 | | | | 4.77 | | | | 51,247 | | | | 622 | | | | 4.85 | |
| Consumer loans (3) | | | 7,349 | | | | 142 | | | | 7.73 | | | | 9,439 | | | | 189 | | | | 8.01 | |
| Total interest-earning assets | | | 1,668,139 | | | | 22,027 | | | | 5.28 | | | | 1,432,770 | | | | 21,137 | | | | 5.90 | |
| Allowance for loan losses | | | (12,583 | ) | | | | | | | | | | | (9,720 | ) | | | | | | | | |
| Total earning assets less allowance | | | | | | | | | | | | | | | | | | | | | | | | |
| for loan losses | | | 1,655,556 | | | | | | | | | | | | 1,423,050 | | | | | | | | | |
| Non-interest-earning assets | | | 104,369 | | | | | | | | | | | | 101,510 | | | | | | | | | |
| Total assets | | $ | 1,759,925 | | | | | | | | | | | $ | 1,524,560 | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Interest-bearing liabilities: | | | | | | | | | | | | | | | | | | | | | | | | |
| Deposits: | | | | | | | | | | | | | | | | | | | | | | | | |
| Savings and NOW accounts | | $ | 208,005 | | | | 647 | | | | 1.24 | | | $ | 182,872 | | | | 551 | | | | 1.21 | |
| Money market accounts | | | 492,968 | | | | 2,960 | | | | 2.40 | | | | 418,972 | | | | 2,695 | | | | 2.57 | |
| Term certificates (4) | | | 418,722 | | | | 3,004 | | | | 2.87 | | | | 330,434 | | | | 3,321 | | | | 4.02 | |
| Total deposits | | | 1,119,695 | | | | 6,611 | | | | 2.36 | | | | 932,278 | | | | 6,567 | | | | 2.82 | |
| Borrowed funds: | | | | | | | | | | | | | | | | | | | | | | | | |
| Short-term borrowings | | | 80,205 | | | | 79 | | | | 0.39 | | | | 45,449 | | | | 198 | | | | 1.74 | |
| Long-term debt | | | 162,391 | | | | 1,805 | | | | 4.45 | | | | 159,628 | | | | 1,745 | | | | 4.37 | |
| Subordinated debt | | | 29,965 | | | | 498 | | | | 6.65 | | | | 29,965 | | | | 538 | | | | 7.18 | |
| Total interest-bearing liabilities | | | 1,392,256 | | | | 8,993 | | | | 2.58 | | | | 1,167,320 | | | | 9,048 | | | | 3.10 | |
| Non-interest-bearing deposits | | | 128,361 | | | | | | | | | | | | 125,416 | | | | | | | | | |
| Other non-interest-bearing liabilities | | | 13,565 | | | | | | | | | | | | 393 | | | | | | | | | |
| Total non-interest-bearing liabilities | | | 141,926 | | | | | | | | | | | | 125,809 | | | | | | | | | |
| Total liabilities | | | 1,534,182 | | | | | | | | | | | | 1,293,129 | | | | | | | | | |
| Stockholders' equity | | | 225,743 | | | | | | | | | | | | 231,431 | | | | | | | | | |
| Total liabilities and stockholders' equity | | $ | 1,759,925 | | | | | | | | | | | $ | 1,524,560 | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Net interest income | | | | | | $ | 13,034 | | | | | | | | | | | $ | 12,089 | | | | | |
| Net interest rate spread (5) | | | | | | | | | | | 2.70 | % | | | | | | | | | | | 2.80 | % |
| Net interest-earning assets (6) | | $ | 275,883 | | | | | | | | | | | $ | 265,450 | | | | | | | | | |
| Net interest margin (7) | | | | | | | | | | | 3.13 | % | | | | | | | | | | | 3.38 | % |
| Ratio of interest-earning assets | | | | | | | | | | | | | | | | | | | | | | | | |
| to total interest-bearing liabilities | | | 1.20 | x | | | | | | | | | | | 1.23 | ��x | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| (1) Yields are annualized. | | | | | | | | | | | | | | | | | | | | | | | | |
| (2) Average balances are presented at average amortized cost. | | | | | | | | | | | | | | | | | |
| (3) Average loans include non-accrual loans and are net of average deferred loan fees/costs. | | | | | | | | | |
| (4) Term certificates include brokered and non-brokered CDs. | | | | | | | | | | | | | | | | | |
| (5) Net interest rate spread represents the difference between the yield on interest-earning assets and the cost of interest-bearing | |
| liabilities at the period indicated. | | | | | | | | | | | | | | | | | | | | | | | | |
| (6) Net interest-earning assets represent total interest-earning assets less total interest-bearing liabilities. | | | | | | | | |
| (7) Net interest margin represents net interest income divided by average total interest-earning assets. | | | | | | | | | |
DANVERS BANCORP, INC.
NET INTEREST INCOME ANALYSIS
(Unaudited)
| | | | | | | | | | | | | | | | | | | | | |
| | | Six Months Ended June 30, | |
| | | 2009 | | | 2008 | |
| | | Average | | | | Interest | | | Average | | | Average | | | | Interest | | | Average | |
| | | Outstanding | | | | Earned/ | | | Yield/ | | | Outstanding | | | | Earned/ | | | Yield/ | |
| | | Balance | | | | Paid | | | Rate (1) | | | Balance | | | | Paid | | | Rate (1) | |
| | | (Dollars in thousands) | |
| Interest-earning assets: | | | | | | | | | | | | | | | | | | | | |
| Interest-earning cash equivalents and | | | | | | | | | | | | | | | | | | | | |
| certificates of deposit | | $ | 35,043 | | | | $ | 195 | | | | 1.11 | % | | $ | 44,142 | | | | $ | 683 | | | | 3.09 | % |
| Debt securities: (2) | | | | | | | | | | | | | | | | | | | | | | | | | | |
| U.S. Government | | | 1,027 | | | | | 14 | | | | 2.73 | | | | 2,042 | | | | | 45 | | | | 4.41 | |
| Gov't-sponsored enterprises and | | | | | | | | | | | | | | | | | | | | | | | | | | |
| FHLMC | | | 193,378 | | | | | 4,749 | | | | 4.91 | | | | 178,128 | | | | | 4,307 | | | | 4.84 | |
| Mortgage-backed | | | 238,959 | | | | | 5,751 | | | | 4.81 | | | | 209,039 | | | | | 5,319 | | | | 5.09 | |
| Municipal bonds | | | 20,830 | | | | | 423 | | | | 4.06 | | | | 18,831 | | | | | 383 | | | | 4.07 | |
| Other | | | 250 | | | | | 4 | | | | 3.20 | | | | 317 | | | | | 9 | | | | 5.68 | |
| Equity securities | | | 14,626 | | | | | 1 | | | | 0.01 | | | | 11,029 | | | | | 210 | | | | 3.81 | |
| Real estate mortgages (3) | | | 621,137 | | | | | 17,330 | | | | 5.58 | | | | 565,553 | | | | | 18,098 | | | | 6.40 | |
| C&I loans (3) | | | 439,138 | | | | | 12,823 | | | | 5.84 | | | | 331,587 | | | | | 11,734 | | | | 7.08 | |
| IRBs (3) | | | 77,952 | | | | | 1,857 | | | | 4.76 | | | | 49,145 | | | | | 1,205 | | | | 4.90 | |
| Consumer loans (3) | | | 7,991 | | | | | 309 | | | | 7.73 | | | | 9,398 | | | | | 381 | | | | 8.11 | |
| Total interest-earning assets | | | 1,650,331 | | | | | 43,456 | | | | 5.27 | | | | 1,419,211 | | | | | 42,374 | | | | 5.97 | |
| Allowance for loan losses | | | (12,464 | ) | | | | | | | | | | | | (9,478 | ) | | | | | | | | | |
| Total earning assets less allowance | | | | | | | | | | | | | | | | | | | | | | | | | | |
| for loan losses | | | 1,637,867 | | | | | | | | | | | | | 1,409,733 | | | | | | | | | | |
| Non-interest-earning assets | | | 102,310 | | | | | | | | | | | | | 97,477 | | | | | | | | | | |
| Total assets | | $ | 1,740,177 | | | | | | | | | | | | $ | 1,507,210 | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Interest-bearing liabilities: | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Deposits: | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Savings and NOW accounts | | $ | 196,923 | | | | | 1,195 | | | | 1.21 | | | $ | 179,542 | | | | | 1,211 | | | | 1.35 | |
| Money market accounts | | | 479,715 | | | | | 5,883 | | | | 2.45 | | | | 402,571 | | | | | 6,024 | | | | 2.99 | |
| Term certificates (4) | | | 399,410 | | | | | 6,031 | | | | 3.02 | | | | 350,738 | | | | | 7,594 | | | | 4.33 | |
| Total deposits | | | 1,076,048 | | | | | 13,109 | | | | 2.44 | | | | 932,851 | | | | | 14,829 | | | | 3.18 | |
| Borrowed funds: | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Short-term borrowings | | | 104,246 | | | | | 207 | | | | 0.39 | | | | 36,163 | | | | | 319 | | | | 1.76 | |
| Long-term debt | | | 162,585 | | | | | 3,594 | | | | 4.42 | | | | 152,534 | | | | | 3,434 | | | | 4.50 | |
| Subordinated debt | | | 29,965 | | | | | 1,031 | | | | 6.88 | | | | 29,965 | | | | | 1,178 | | | | 7.86 | |
| Total interest-bearing liabilities | | | 1,372,844 | | | | | 17,941 | | | | 2.61 | | | | 1,151,513 | | | | | 19,760 | | | | 3.43 | |
| Non-interest-bearing deposits | | | 126,514 | | | | | | | | | | | | | 145,999 | | | | | | | | | | |
| Other non-interest-bearing liabilities | | | 13,508 | | | | | | | | | | | | | 3,260 | | | | | | | | | | |
| Total non-interest-bearing liabilities | | | 140,022 | | | | | | | | | | | | | 149,259 | | | | | | | | | | |
| Total liabilities | | | 1,512,866 | | | | | | | | | | | | | 1,300,772 | | | | | | | | | | |
| Stockholders' equity | | | 227,311 | | | | | | | | | | | | | 206,438 | | | | | | | | | | |
| Total liabilities and stockholders' equity | | $ | 1,740,177 | | | | | | | | | | | | $ | 1,507,210 | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Net interest income | | | | | | | $ | 25,515 | | | | | | | | | | | | $ | 22,614 | | | | | |
| Net interest rate spread (5) | | | | | | | | | | | | 2.66 | % | | | | | | | | | | | | 2.54 | % |
| Net interest-earning assets (6) | | $ | 277,487 | | | | | | | | | | | | $ | 267,698 | | | | | | | | | | |
| Net interest margin (7) | | | | | | | | | | | | 3.09 | % | | | | | | | | | | | | 3.19 | % |
| Ratio of interest-earning assets | | | | | | | | | | | | | | | | | | | | | | | | | | |
| to total interest-bearing liabilities | | | 1.20 | x | | | | | | | | | | | | 1.23 | x | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
| (1) Yields are annualized. | | | | | | | | | | | | | | | | | | | | | | | | | | |
| (2) Average balances are presented at average amortized cost. | | | | | | | | | | | | | | | | | | |
| (3) Average loans include non-accrual loans and are net of average deferred loan fees/costs. | | | | | | | | | | |
| (4) Term certificates include brokered and non-brokered CDs. | | | | | | | | | | | | | | | | | | |
| (5) Net interest rate spread represents the difference between the yield on interest-earning assets and the cost of interest-bearing | |
| liabilities at the period indicated. | | | | | | | | | | | | | | | | | | | | | | | | | | |
| (6) Net interest-earning assets represent total interest-earning assets less total interest-bearing liabilities. | | | | | | | | |
| (7) Net interest margin represents net interest income divided by average total interest-earning assets. | | | | | | | | | | |
DANVERS BANCORP, INC.
NET INTEREST INCOME ANALYSIS
(Unaudited)
| | | | | | | | | | | | | | | | | | | | | |
| | | Three Months Ended | |
| | | June 30, 2009 | | | March 31, 2009 | |
| | | Average | | | | Interest | | | Average | | | Average | | | | Interest | | | Average | |
| | | Outstanding | | | | Earned/ | | | Yield/ | | | Outstanding | | | | Earned/ | | | Yield/ | |
| | | Balance | | | | Paid | | | Rate (1) | | | Balance | | | | Paid | | | Rate (1) | |
| | | (Dollars in thousands) | |
| Interest-earning assets: | | | | | | | | | | | | | | | | | | | | |
| Interest-earning cash equivalents and | | | | | | | | | | | | | | | | | | | | |
| certificates of deposit | | $ | 42,563 | | | | $ | 98 | | | | 0.92 | % | | $ | 27,475 | | | | $ | 97 | | | | 1.41 | % |
| Debt securities: (2) | | | | | | | | | | | | | | | | | | | | | | | | | | |
| U.S. Government | | | 520 | | | | | 3 | | | | 2.31 | | | | 1,538 | | | | | 11 | | | | 2.86 | |
| Gov't-sponsored enterprises and | | | | | | | | | | | | | | | | | | | | | | | | | | |
| FHLMC | | | 188,332 | | | | | 2,311 | | | | 4.91 | | | | 198,460 | | | | | 2,439 | | | | 4.92 | |
| Mortgage-backed | | | 234,042 | | | | | 2,780 | | | | 4.75 | | | | 243,959 | | | | | 2,970 | | | | 4.87 | |
| Municipal bonds | | | 21,692 | | | | | 220 | | | | 4.06 | | | | 19,960 | | | | | 203 | | | | 4.07 | |
| Other | | | 250 | | | | | 2 | | | | 3.20 | | | | 250 | | | | | 2 | | | | 3.20 | |
| Equity securities | | | 14,626 | | | | | 1 | | | | 0.30 | | | | 14,626 | | | | | - | | | | - | |
| Real estate mortgages (3) | | | 636,246 | | | | | 8,905 | | | | 5.60 | | | | 605,871 | | | | | 8,425 | | | | 5.56 | |
| C&I loans (3) | | | 441,482 | | | | | 6,599 | | | | 5.98 | | | | 436,752 | | | | | 6,225 | | | | 5.70 | |
| IRBs (3) | | | 81,037 | | | | | 966 | | | | 4.77 | | | | 74,833 | | | | | 890 | | | | 4.76 | |
| Consumer loans (3) | | | 7,349 | | | | | 142 | | | | 7.73 | | | | 8,641 | | | | | 167 | | | | 7.73 | |
| Total interest-earning assets | | | 1,668,139 | | | | | 22,027 | | | | 5.28 | | | | 1,632,365 | | | | | 21,429 | | | | 5.25 | |
| Allowance for loan losses | | | (12,583 | ) | | | | | | | | | | | | (12,341 | ) | | | | | | | | | |
| Total earning assets less allowance | | | | | | | | | | | | | | | | | | | | | | | | | | |
| for loan losses | | | 1,655,556 | | | | | | | | | | | | | 1,620,024 | | | | | | | | | | |
| Non-interest-earning assets | | | 104,369 | | | | | | | | | | | | | 100,126 | | | | | | | | | | |
| Total assets | | $ | 1,759,925 | | | | | | | | | | | | $ | 1,720,150 | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Interest-bearing liabilities: | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Deposits: | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Savings and NOW accounts | | $ | 208,005 | | | | | 647 | | | | 1.24 | | | $ | 185,714 | | | | | 548 | | | | 1.18 | |
| Money market accounts | | | 492,968 | | | | | 2,960 | | | | 2.40 | | | | 466,267 | | | | | 2,923 | | | | 2.51 | |
| Term certificates (4) | | | 418,722 | | | | | 3,004 | | | | 2.87 | | | | 379,904 | | | | | 3,027 | | | | 3.19 | |
| Total deposits | | | 1,119,695 | | | | | 6,611 | | | | 2.36 | | | | 1,031,885 | | | | | 6,498 | | | | 2.52 | |
| Borrowed funds: | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Short-term borrowings | | | 80,205 | | | | | 79 | | | | 0.39 | | | | 128,388 | | | | | 128 | | | | 0.40 | |
| Long-term debt | | | 162,391 | | | | | 1,805 | | | | 4.45 | | | | 162,781 | | | | | 1,789 | | | | 4.40 | |
| Subordinated debt | | | 29,965 | | | | | 498 | | | | 6.65 | | | | 29,965 | | | | | 533 | | | | 7.11 | |
| Total interest-bearing liabilities | | | 1,392,256 | | | | | 8,993 | | | | 2.58 | | | | 1,353,019 | | | | | 8,948 | | | | 2.65 | |
| Non-interest-bearing deposits | | | 128,361 | | | | | | | | | | | | | 124,656 | | | | | | | | | | |
| Other non-interest-bearing liabilities | | | 13,565 | | | | | | | | | | | | | 13,572 | | | | | | | | | | |
| Total non-interest-bearing liabilities | | | 141,926 | | | | | | | | | | | | | 138,228 | | | | | | | | | | |
| Total liabilities | | | 1,534,182 | | | | | | | | | | | | | 1,491,247 | | | | | | | | | | |
| Stockholders' equity | | | 225,743 | | | | | | | | | | | | | 228,903 | | | | | | | | | | |
| Total liabilities and stockholders' equity | | $ | 1,759,925 | | | | | | | | | | | | $ | 1,720,150 | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Net interest income | | | | | | | $ | 13,034 | | | | | | | | | | | | $ | 12,481 | | | | | |
| Net interest rate spread (5) | | | | | | | | | | | | 2.70 | % | | | | | | | | | | | | 2.60 | % |
| Net interest-earning assets (6) | | $ | 275,883 | | | | | | | | | | | | $ | 279,346 | | | | | | | | | | |
| Net interest margin (7) | | | | | | | | | | | | 3.13 | % | | | | | | | | | | | | 3.06 | % |
| Ratio of interest-earning assets | | | | | | | | | | | | | | | | | | | | | | | | | | |
| to total interest-bearing liabilities | | | 1.20 | x | | | | | | | | | | | | 1.21 | x | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
| (1) Yields are annualized | | | | | | | | | | | | | | | | | | | | | | | | | | |
| (2) Average balances are presented at average amortized cost. | | | | | | | | | | | | | | | | | | |
| (3) Average loans include non-accrual loans and are net of average deferred loan fees/costs. | | | | | | | | | | |
| (4) Term certificates include brokered and non-brokered CDs. | | | | | | | | | | | | | | | | | | |
| (5) Net interest rate spread represents the difference between the yield on interest-earning assets and the cost of interest-bearing | |
| liabilities at the period indicated. | | | | | | | | | | | | | | | | | | | | | | | | | | |
| (6) Net interest-earning assets represent total interest-earning assets less total interest-bearing liabilities. | | | | | | | | |
| (7) Net interest margin represents net interest income divided by average total interest-earning assets. | | | | | | | | | | |
DANVERS BANCORP, INC.
SELECTED FINANCIAL RATIOS AND OTHER DATA
(Unaudited)
| | At or For the | | At or For the | | At or For the |
| | Three Months Ended | | Six Months Ended | | Three Months Ended |
| | June 30, | | June 30, | | March 31, |
| | 2009 | | 2008 | | 2009 | | 2008 | | 2009 |
| | | | | | | | | | | |
| Performance Ratios: | | | | | | | | | | |
| | | | | | | | | | | |
| Return (loss) on assets (ratio of income to average total assets) (1) | 0.03% | | 0.14% | | 0.17% | | (0.36%) | | 0.32% | |
| Return on equity (loss) (ratio of income to average equity) (1) | 0.24% | | 0.94% | | 1.34% | | (2.63%) | | 2.42% | |
| Net interest rate spread (1) (2) | 2.70% | | 2.80% | | 2.66% | | 2.54% | | 2.60% | |
| Net interest margin (1) (3) | 3.13% | | 3.38% | | 3.09% | | 3.19% | | 3.06% | |
| Efficiency ratio (4) | 91.45% | | 78.01% | | 87.21% | | 121.86% | | 82.79% | |
| Non-interest expenses to average total assets (1) | 3.09% | | 2.82% | | 2.92% | | 4.30% | | 2.74% | |
| Average interest-earning assets to interest-bearing liabilities | 1.20x | | 1.23x | | 1.20x | | 1.23x | | 1.21x | |
| | | | | | | | | | | |
| Asset Quality Ratios: | | | | | | | | | | |
| | | | | | | | | | | |
| Non-performing assets to total assets | 0.79% | | 0.71% | | 0.79% | | 0.71% | | 0.55% | |
| Non-performing loans to total loans | 1.05% | | 0.80% | | 1.05% | | 0.80% | | 0.73% | |
| Allowance for loan losses to non-performing loans | 101.41% | | 128.69% | | 101.41% | | 128.69% | | 149.54% | |
| Allowance for loan losses to total loans | 1.07% | | 1.03% | | 1.07% | | 1.03% | | 1.09% | |
| | | | | | | | | | | |
| Capital Ratios: | | | | | | | | | | |
| | | | | | | | | | | |
| Risk-based capital (to risk-weighted assets) | 20.16% | | 24.35% | | 20.16% | | 24.35% | | 21.31% | |
| Tier 1 risk-based capital (to risk-weighted assets) | 19.18% | | 23.41% | | 19.18% | | 23.41% | | 20.31% | |
| Tier 1 leverage capital (to average assets) | 14.21% | | 17.07% | | 14.21% | | 17.07% | | 14.76% | |
| Stockholders' equity to total assets | 12.46% | | 15.28% | | 12.46% | | 15.28% | | 13.27% | |
| Average stockholders' equity to average assets | 12.83% | | 15.18% | | 13.06% | | 13.70% | | 13.31% | |
________________________________
| (1) | Ratios for the three and six months ended June 30, 2009 and 2008 and three months ended March 31, 2009 are annualized. |
| (2) | The net interest rate spread represents the difference between the weighted-average yield on interest-earning assets and the weighted-average cost of interest-bearing liabilities for the period. |
| (3) | The net interest margin represents net interest income as a percent of average interest-earning assets for the period. |
| (4) | The efficiency ratio represents non-interest expense for the period minus expenses related to the amortization of intangible assets divided by the sum of net interest income (before the loan loss provision) plus non-interest income. |
