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SECURITIES AND EXCHANGE COMMISSION
þ | Annual Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 |
o | Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 |
001-09071
Florida | 59-2022148 | |
(State or other jurisdiction of | (I.R.S Employer Identification No.) | |
incorporation or organization) |
2100 West Cypress Creek Road | ||
Fort Lauderdale, Florida | 33309 | |
(Address of principal executive office) | (Zip Code) |
(Registrant’s telephone number, including area code)
Class A Common Stock, $.01 par Value | Pink Sheet Electronic Quotation Service | |
(Title of Class) | (Name of each exchange on which registered) |
Class B Common Stock, $.01 par Value | OTC BB | |
(Title of Class) | (Name of each exchange on which registered) |
Large accelerated filero | Accelerated filero | Non-accelerated filer o (Do not check if a smaller reporting company) | Smaller reporting companyþ |
Class B Common Stock, $.01 par value, 6,875,104 shares outstanding.
Annual Report on Form 10-K for the Year Ended December 31, 2008
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Item 10. Directors, Executive Officers and Corporate Governance | ||||||||
Item 11. Executive Compensation | ||||||||
Item 12. Security Ownership of Certain Beneficial Owners and Management Related Stockholder Matters | ||||||||
Item 13. Certain Relationships and Related Transactions, and Director Independence | ||||||||
Item 14. Principal Accountant Fees and Services | ||||||||
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253 | ||||||||
EX-12.1 | ||||||||
EX-21.1 | ||||||||
EX-23.1 | ||||||||
EX-23.2 | ||||||||
EX-31.1 | ||||||||
EX-31.2 | ||||||||
EX-31.3 | ||||||||
EX-32.1 | ||||||||
EX-32.2 | ||||||||
EX-32.3 | ||||||||
EX-99.1 |
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• | the impact of economic, competitive and other factors affecting the Company and its subsidiaries, and their operations, markets, products and services; | ||
• | adverse conditions in the stock market, the public debt market and other capital markets and the impact of such conditions on the activities of the Company and its subsidiaries; | ||
• | the Company’s future cash flow may be insufficient to meet its operating needs and the Company may not have the ability to provide for its ongoing operating requirements; | ||
• | the performance of entities in which the Company has made investments may not be as anticipated; | ||
• | BFC is dependent upon dividends from its subsidiaries to fund its operations, dividends are not currently being paid and may not be paid in the future, and even if paid BFC has historically experienced and may continue to experience negative cash flow; BFC may need to issue debt or equity securities to fund its operations, and any such securities may not be issued on favorable terms, if at all; | ||
• | BFC will be subject to the unique business and industry risks and characteristics of each entity in which an investment is made; and | ||
• | BFC shareholders’ interests may be diluted if additional shares of BFC common stock are issued. |
• | the impact of economic, competitive and other factors affecting BankAtlantic Bancorp and its operations, markets, products and services, including the impact of a continued and deepening recession on its business generally, its well capitalized regulatory capital ratios, as well as the ability of its borrowers to meet their obligations and its customers to maintain account balances; | ||
• | credit risks and loan losses, and the related sufficiency of the allowance for loan losses, including the impact on the credit quality of BankAtlantic loans (including those held in the asset workout subsidiary of BankAtlantic Bancorp) of a sustained downturn in the economy and in the real estate market and other changes in the real estate markets in BankAtlantic’s trade area, and where BankAtlantic’s collateral is located; | ||
• | the risks of additional charge-offs, impairments and required increases in BankAtlantic’s allowance for loan losses; | ||
• | changes in interest rates and the effects of, and changes in, trade, monetary and fiscal policies and laws including their impact on the BankAtlantic’s net interest margin; | ||
• | adverse conditions in the stock market, the public debt market and other financial and credit markets and the impact of such conditions on BankAtlantic Bancorp’s activities, including BankAtlantic Bancorp’s |
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ability to raise capital, the value of its assets and on the ability of borrowers to meet their debt obligations and BankAtlantic’s seven-day banking initiatives and other initiatives not resulting in continued growth of core deposits or increasing average balances of new deposit accounts or producing results which do not justify their costs; | |||
• | the success of BankAtlantic Bancorp’s expense reduction initiatives and the ability to achieve additional cost savings; | ||
• | the impact of periodic valuation testing of goodwill and other assets; | ||
• | the impact of capital requirements at BankAtlantic Bancorp and BankAtlantic and the risk that they will not be successful in raising capital at a reasonable cost if at all; and | ||
• | the OTS and the FDIC have significant discretion in connection with their supervisory and enforcement activities and examination policies. Any change in such applicable activities or policies, whether by the OTS, the FDIC or the Congress, could have a material adverse impact on BankAtlantic Bancorp’s results and operations. |
• | the impact of economic, competitive and other factors affecting Woodbridge and its operations; | ||
• | the market for real estate in the areas where Woodbridge has developments will decline further, and the impact of market conditions will adversely impact Woodbridge’s margins and the fair value of its real estate inventory; | ||
• | the impact if the value of the property held by Core Communities declines; | ||
• | the risk that the development of parcels and master-planned communities will not be completed as anticipated; | ||
• | the continued declines in the estimated fair value of our real estate inventory will result in additional write-downs or impairment charges; | ||
• | the impact of increases in interest rates and availability of credit to buyers of our inventory; resulting in accelerated principal payments on Woodbridge’s debt obligations due to re-margining or curtailment payment requirements; | ||
• | the ability to obtain financing and to renew existing credit facilities on acceptable terms, if at all; | ||
• | Woodbridge’s ability to access additional capital on acceptable terms, if at all; | ||
• | the risks associated with Woodbridge’s business strategy, including Woodbridge’s ability to successfully make investments notwithstanding current adverse conditions in the economy and the credit markets; and | ||
• | Woodbridge’s success at managing the risks involved in the foregoing. |
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Percent | ||||||||||||
Shares | Percent of | of | ||||||||||
Owned | Ownership | Vote | ||||||||||
BankAtlantic Bancorp | ||||||||||||
Class A Common Stock | 2,389,697 | 23.30 | % | 12.35 | % | |||||||
Class B Common Stock | 975,225 | 100.00 | % | 47.00 | % | |||||||
Total | 3,364,922 | 29.96 | % | 59.35 | % | |||||||
Woodbridge Holdings Corporation | ||||||||||||
Class A Common Stock (1) | 3,735,392 | 22.43 | % | 11.89 | % | |||||||
Class B Common Stock | 243,807 | 100.00 | % | 47.00 | % | |||||||
Total | 3,979,199 | 23.55 | % | 58.89 | % |
(1) | BFC’s percentage of vote includes 1,229,117 shares of Woodbridge’s Class A Common Stock which BFC had previously agreed not to vote (except in limited circumstances) pursuant to a letter agreement requested by Woodbridge in connection with the listing of its shares on the NYSE. |
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December 31, 2008 | December 31, 2007 | |||||||||||||||
Full-time | Part-time | Full-time | Part-time | |||||||||||||
BFC | 37 | 1 | 47 | 1 |
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(BankAtlantic Bancorp)
• | attracting checking and savings deposits from individuals and business customers, | ||
• | originating commercial real estate, middle market, consumer and small business loans, | ||
• | purchasing wholesale residential loans, and | ||
• | investing in mortgage-backed securities, tax certificates and other securities. |
• | Continuing the Bank’s “Florida’s Most Convenient Bank” Initiative.BankAtlantic began its “Florida’s Most Convenient Bank” initiative in 2002, when it introduced seven-day banking in |
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(BankAtlantic Bancorp)
Florida. This banking initiative resulted in a significant increase in core deposits (demand deposit accounts, NOW checking accounts and savings accounts). BankAtlantic’s core deposits increased from approximately $600 million as of December 31, 2001 to $2.2 billion as of December 31, 2008. We believe the competitive market for deposits, the impact of the recession on our customers as well as reduced confidence in the banking system negatively impacted the growth of core deposits, which at December 31, 2008 declined by $151.0 million or 7% from December 31, 2007. While we believe that the decrease is a reflection of what is happening in the market generally, we are implementing strategies which we believe will enhance customer loyalty with our current customers and attract new customers in an effort to increase our core deposit balances. | |||
• | Maintaining and Strengthening our Capital Position.BankAtlantic exceeded all applicable regulatory capital requirements and was considered a “well capitalized” financial institution at December 31, 2008. See “Regulation and Supervision” – Capital Requirements” for an explanation of capital standards. Management has implemented initiatives with a view to preserving capital in response to the current recessionary economic environment. These initiatives include reducing assets as a result of loan and securities repayments in the ordinary course, eliminating cash dividends to the Parent Company, consolidating back-office facilities, decreasing store and call center hours, reducing staffing levels and marketing expenses, selling its central Florida stores, delaying its retail network expansion, and pursuing efforts to improve other operational efficiencies. | ||
• | Managing Credit Risk.BankAtlantic believes that its underwriting policies and procedures are structured to enable it to offer products and services to its customers while minimizing its exposure to credit risk. However, the economic recession and the substantial decline in real estate values throughout the United States, and particularly in Florida, have had an adverse impact on the credit quality of our loan portfolio. In response, BankAtlantic has attempted to address credit risk through steps which include: |
o | Specifically monitored certain commercial and residential land acquisition, development and construction loans and related collateral; | ||
o | Focused efforts and enhanced staffing relating to loan work-outs and collection processes; | ||
o | Suspended the origination of land and residential acquisition, development and construction loans; | ||
o | Transferred $101.5 million of non-performing commercial real estate loans to the Parent Company in March 2008; | ||
o | Substantially reduced home equity loan originations based on the implementation of new underwriting requirements; | ||
o | Terminated certain home equity loan unused lines of credit based on declines in borrower credit scores or the value of loan collateral; and | ||
o | Increased the frequency of targeted loan reviews. |
• | Reducing Operating Expenses. Management continued initiatives to decrease operating expenses during 2008, including lowering advertising and marketing expenditures, exiting the Orlando market, reducing store hours, shortening call center hours, reducing staffing levels, renegotiating vendor contracts, outsourcing certain back-office functions, and consolidating back-office operations. During 2009, management intends to seek to further reduce costs in a manner which does not materially impact the quality of customer service. BankAtlantic is also continuing to evaluate its products and services as well as its delivery systems and back-office support infrastructure with a view to providing cost effective and profitable products and services to its customers. |
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(BankAtlantic Bancorp)
• | Diversification of BankAtlantic’s Loan Portfolio. BankAtlantic is focused on the diversification of its loan portfolio. During 2009 BankAtlantic intends to seek to generate a greater percentage of small business and middle market commercial non-mortgage loans through its retail and lending network. As middle market and small business loans grow, we expect that commercial real estate loan portfolio balances and residential mortgage loans will decline during 2009 through the scheduled repayment of existing loans and significant reductions in commercial real estate loan originations. |
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(BankAtlantic Bancorp)
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(BankAtlantic Bancorp)
As of December 31, | ||||||||||||||||||||||||||||||||||||||||||||
2008 | 2007 | 2006 | 2005 | 2004 | ||||||||||||||||||||||||||||||||||||||||
Amount | Pct | Amount | Pct | Amount | Pct | Amount | Pct | Amount | Pct | |||||||||||||||||||||||||||||||||||
Loans receivable: | ||||||||||||||||||||||||||||||||||||||||||||
Real estate loans: | ||||||||||||||||||||||||||||||||||||||||||||
Residential | $ | 1,930 | 45.34 | 2,156 | 47.66 | 2,151 | 46.81 | 2,030 | 43.92 | 2,057 | 45.16 | % | ||||||||||||||||||||||||||||||||
Consumer — home equity | 719 | 16.89 | 676 | 14.94 | 562 | 12.23 | 514 | 11.12 | 457 | 10.03 | ||||||||||||||||||||||||||||||||||
Construction and development | 301 | 7.07 | 416 | 9.20 | 475 | 10.34 | 785 | 16.99 | 766 | 16.82 | ||||||||||||||||||||||||||||||||||
Commercial | 930 | 21.85 | 882 | 19.49 | 973 | 21.17 | 979 | 21.18 | 1,004 | 22.04 | ||||||||||||||||||||||||||||||||||
Small business | 219 | 5.14 | 212 | 4.69 | 187 | 4.07 | 152 | 3.29 | 124 | 2.72 | ||||||||||||||||||||||||||||||||||
Loans to Levitt Corporation | — | 0.00 | — | 0.00 | — | 0.00 | — | 0.00 | 9 | 0.20 | ||||||||||||||||||||||||||||||||||
Other loans: | ||||||||||||||||||||||||||||||||||||||||||||
Commercial business | 143 | 3.36 | 131 | 2.90 | 157 | 3.42 | 88 | 1.90 | 93 | 2.04 | ||||||||||||||||||||||||||||||||||
Small business — non-mortgage | 108 | 2.54 | 106 | 2.34 | 98 | 2.13 | 83 | 1.80 | 67 | 1.47 | ||||||||||||||||||||||||||||||||||
Consumer | 26 | 0.61 | 31 | 0.68 | 26 | 0.57 | 27 | 0.59 | 18 | 0.40 | ||||||||||||||||||||||||||||||||||
Residential loans held for sale | 3 | 0.07 | 4 | 0.09 | 9 | 0.20 | 3 | 0.06 | 5 | 0.11 | ||||||||||||||||||||||||||||||||||
Total | 4,379 | 102.87 | 4,614 | 101.99 | 4,638 | 100.94 | 4,661 | 100.85 | 4,600 | 100.99 | ||||||||||||||||||||||||||||||||||
Adjustments: | ||||||||||||||||||||||||||||||||||||||||||||
Unearned discounts (premiums) | (3 | ) | -0.07 | (4 | ) | -0.09 | (1 | ) | -0.02 | (2 | ) | -0.04 | (1 | ) | -0.02 | |||||||||||||||||||||||||||||
Allowance for loan losses | 125 | 2.94 | 94 | 2.08 | 44 | 0.96 | 41 | 0.89 | 46 | 1.01 | ||||||||||||||||||||||||||||||||||
Total loans receivable, net | $ | 4,257 | 100.00 | 4,524 | 100.00 | 4,595 | 100.00 | 4,622 | 100.00 | 4,555 | 100.00 | % | ||||||||||||||||||||||||||||||||
As of December 31, | ||||||||
2008 | 2007 | |||||||
Builder land bank loans | $ | 62 | 150 | |||||
Land acquisition and development loans | 166 | 202 | ||||||
Land acquisition, development and construction loans | 76 | 151 | ||||||
Total commercial residential development loans (1) | $ | 304 | 503 | |||||
(1) | At March 31, 2008, $101.5 million of non-performing loans were transferred to a subsidiary of the Parent Company. |
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(BankAtlantic Bancorp)
Corporate | ||||||||||||||||||||||||
Mortgage- | Bond | Weighted | ||||||||||||||||||||||
Tax | Tax-Exempt | Backed | and | Average | ||||||||||||||||||||
Certificates | Securities | Securities | Other | Total | Yield | |||||||||||||||||||
December 31, 2008 | ||||||||||||||||||||||||
Maturity: (1) | ||||||||||||||||||||||||
One year or less | $ | 224,434 | — | — | — | 224,434 | 6.68 | % | ||||||||||||||||
After one through five years | — | — | 101 | 250 | 351 | 3.98 | ||||||||||||||||||
After five through ten years | — | — | 36,885 | — | 36,885 | 5.16 | ||||||||||||||||||
After ten years | — | — | 662,238 | — | 662,238 | 4.77 | ||||||||||||||||||
Fair values (2) | $ | 224,434 | — | 699,224 | 250 | 923,908 | 5.25 | % | ||||||||||||||||
Amortized cost (2) | $ | 213,534 | — | 687,344 | 250 | 901,128 | 6.00 | % | ||||||||||||||||
Weighted average yield based on fair values | 6.68 | — | 4.79 | 4.30 | 5.25 | |||||||||||||||||||
Weighted average maturity (yrs) | 1.0 | — | 23.95 | 1.67 | 18.50 | |||||||||||||||||||
December 31, 2007 | ||||||||||||||||||||||||
Fair values (2) | $ | 188,401 | — | 788,461 | 681 | 977,543 | 5.90 | % | ||||||||||||||||
Amortized cost (2) | $ | 188,401 | — | 785,682 | 685 | 974,768 | 6.06 | % | ||||||||||||||||
December 31, 2006 | ||||||||||||||||||||||||
Fair values (2) | $ | 195,391 | 397,244 | 361,750 | 675 | 955,060 | 6.17 | % | ||||||||||||||||
Amortized cost (2) | $ | 195,391 | 397,469 | 365,565 | 685 | 959,110 | 6.05 | % | ||||||||||||||||
(1) | Except for tax certificates, maturities are based upon contractual maturities. Tax certificates do not have stated maturities, and estimates in the above table are based upon historical repayment experience (generally 1 to 2 years). | |
(2) | Equity and tax exempt securities held by the Parent Company with a cost of $3.6 million, $162.6 million, and $88.6 million and a fair value of $4.1 million, $179.5 million, and $99.9 million, at December 31, 2008, 2007 and 2006, respectively, were excluded from the above table. At December 31, 2008, equities held by BankAtlantic with a cost of $0.8 million and a fair value of $0.8 million was excluded from the above table. |
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(BankAtlantic Bancorp)
December 31, 2008 (1) | ||||||||||||||||
Gross | Gross | |||||||||||||||
Amortized | Unrealized | Unrealized | Estimated | |||||||||||||
Cost | Appreciation | Depreciation | Fair Value | |||||||||||||
Tax certificates and investment securities: | �� | |||||||||||||||
Tax certificates: | ||||||||||||||||
Cost equals market | $ | 213,534 | 10,900 | — | 224,434 | |||||||||||
Securities available for sale: | ||||||||||||||||
Investment securities: | ||||||||||||||||
Cost equals market | 250 | — | — | 250 | ||||||||||||
Market over cost | — | — | — | — | ||||||||||||
Cost over market | — | — | — | — | ||||||||||||
Mortgage-backed securities : | ||||||||||||||||
Cost equals market | — | — | — | — | ||||||||||||
Market over cost | 654,199 | 12,863 | — | 667,062 | ||||||||||||
Cost over market | 33,145 | — | 983 | 32,162 | ||||||||||||
Total | $ | 901,128 | 23,763 | 983 | 923,908 | |||||||||||
1) | The above table excludes Parent Company equity securities with a cost of $3.6 million and a fair value of $4.1 million at December 31, 2008. At December 31, 2008, equities held by BankAtlantic with a cost of $0.8 million and a fair value of $0.8 million was excluded from the above table. |
• | Securities sold under agreements to repurchase include a sale of a portion of its current investment portfolio (usually mortgage-backed securities and REMICs) at a negotiated rate and an agreement to repurchase the same assets on a specified future date. BankAtlantic issues repurchase agreements to institutions and to its customers. These transactions are collateralized by securities in its investment portfolio but are not insured by the FDIC. See note 16 to the “Notes to Consolidated Financial Statements” for more information |
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(BankAtlantic Bancorp)
regarding BankAtlantic’s Securities sold under agreements to repurchase borrowings. | |||
• | Treasury tax and loan borrowings represent BankAtlantic’s participation in the Federal Reserve Treasury Investment Program. Under this program the Federal Reserve places funds with BankAtlantic obtained from treasury tax and loan payments received by financial institutions. See note 15 to the “Notes to Consolidated Financial Statements” for more information regarding BankAtlantic’s Treasury tax and loan borrowings. | ||
• | Federal funds borrowings occur under established facilities with various federally-insured banking institutions to purchase federal funds. We also have a borrowing facility with various federal agencies which may place funds with us at overnight rates. BankAtlantic uses these facilities on an overnight basis to assist in managing its cash requirements. These advances are collateralized by a security lien against its consumer loans. See note 15 to the “Notes to Consolidated Financial Statements” for more information regarding BankAtlantic’s federal funds borrowings. | ||
• | Term auction facilities represent short term borrowings from the Federal Reserve System. These borrowings are collateralized by securities available for sale and are generally at federal fund interest rates which have been lower interest rates than alternative borrowings. See note 15 to the “Notes to Consolidated Financial Statements” for more information regarding BankAtlantic’s term auction facilities borrowings. | ||
• | BankAtlantic’s other borrowings have floating interest rates and consist of a mortgage-backed bond and subordinated debentures. See note 17 to the “Notes to Consolidated Financial Statements” for more information regarding BankAtlantic’s other borrowings. |
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(BankAtlantic Bancorp)
As of December 31, 2008 | ||||||||||||||||
Gross | Gross | |||||||||||||||
Carrying | Unrealized | Unrealized | Estimated | |||||||||||||
(in thousands) | Value | Appreciation | Depreciation | Fair Value | ||||||||||||
Cash and cash equivalents | $ | 37,116 | — | — | 37,116 | |||||||||||
Equity securities | 1,597 | — | — | 1,597 | ||||||||||||
Private investment securities | 2,036 | 467 | — | 2,503 | ||||||||||||
Total | $ | 40,749 | 467 | — | 41,216 | |||||||||||
(in millions) | Amount | |||
Builder land bank loans | $ | 22 | ||
Land acquisition and development loans | 17 | |||
Land acquisition, development and construction loans | 29 | |||
Commercial | 14 | |||
Total commercial loans | $ | 82 | ||
December 31, 2008 | December 31, 2007 | |||||||||||||||
Full- | Part- | Full- | Part- | |||||||||||||
Time | time | time | time | |||||||||||||
BankAtlantic Bancorp | 6 | — | 7 | — | ||||||||||||
BankAtlantic | 1,698 | 143 | 2,207 | 355 | ||||||||||||
Total | 1,704 | 143 | 2,214 | 355 | ||||||||||||
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(BankAtlantic Bancorp)
• | acquiring another savings institution or its holding company without prior written approval of the OTS; | ||
• | acquiring or retaining, with certain exceptions, more than 5% of a non-subsidiary savings institution, a non-subsidiary holding company, or a non-subsidiary company engaged in activities other than those permitted by HOLA; or | ||
• | Acquiring or retaining control of a depository institution that is not insured by the FDIC. |
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(BankAtlantic Bancorp)
• | mortgage loans secured by residential and commercial real estate; | ||
• | commercial and consumer loans; | ||
• | certain types of debt securities; and | ||
• | certain other assets. |
• | a tangible capital requirement for savings banks to have tangible capital in an amount equal to at least 1.5% of adjusted total assets; | ||
• | a leverage ratio requirement: |
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(BankAtlantic Bancorp)
o | for savings banks assigned the highest composite rating of 1, to have core capital in an amount equal to at least 3% of adjusted total assets; or | ||
o | for savings banks assigned any other composite rating, to have core capital in an amount equal to at least 4% of adjusted total assets, or a higher percentage if warranted by the particular circumstances or risk profile of the savings bank; and |
• | a risk-based capital requirement for savings banks to have capital in an amount equal to at least 8% of risk-weighted assets. |
• | the size of the savings bank, on which the basic assessment is based; |
• | the savings bank’s supervisory condition, which results in an additional assessment based on a percentage of the basic assessment for any savings bank with a composite rating of 3, 4 or 5 in its most recent safety and soundness examination; and |
• | the complexity of the savings bank’s operations, which results in an additional assessment based on a percentage of the basic assessment for any savings bank that has more than $1 billion in trust assets that it administers, loans that it services for others or assets covered by its recourse obligations or direct credit substitutes. |
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(BankAtlantic Bancorp)
• | a lending test, to evaluate the institution’s record of making loans in its designated assessment areas; |
• | an investment test, to evaluate the institution’s record of investing in community development projects, affordable housing, and programs benefiting low or moderate income individuals and businesses; and |
• | a service test, to evaluate the institution’s delivery of banking services throughout its designated assessment area. |
• | making or renewing a loan or other extension of credit to an affiliate; |
• | purchasing, or investing in, a security issued by an affiliate; |
• | purchasing an asset from an affiliate; |
• | accepting a security issued by an affiliate as collateral for a loan or other extension of credit to any person or entity; and |
• | issuing a guarantee, acceptance or letter of credit on behalf of an affiliate. |
• | making a loan or other extension of credit to an affiliate that is engaged in any non-bank holding company activity; and |
• | purchasing, or investing in, securities issued by an affiliate that is not a subsidiary. |
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(BankAtlantic Bancorp)
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(BankAtlantic Bancorp)
• | its total capital is at least 10% of its risk-weighted assets; |
• | its core capital is at least 6% of its risk-weighted assets; |
• | its core capital is at least 5% of its adjusted total assets; and |
• | it is not subject to any written agreement, order, capital directive or prompt corrective action directive issued by the OTS, or certain regulations, to meet or maintain a specific capital level for any capital measure. |
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(BankAtlantic Bancorp)
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(BankAtlantic Bancorp)
• | internal policies, procedures and controls designed to implement and maintain the savings bank’s compliance with all of the requirements of the USA PATRIOT Act, the BSA and related laws and regulations; |
• | systems and procedures for monitoring and reporting of suspicious transactions and activities; |
• | a designated compliance officer; |
• | employee training; |
• | an independent audit function to test the anti-money laundering program; |
• | procedures to verify the identity of each customer upon the opening of accounts; and |
• | heightened due diligence policies, procedures and controls applicable to certain foreign accounts and relationships. |
• | require lenders to disclose credit terms in meaningful and consistent ways; |
• | require financial institutions to establish policies and procedures regarding identity theft and notify customers of certain information concerning their credit reporting; |
• | prohibit discrimination against an applicant in any consumer or business credit transaction; |
• | prohibit discrimination in housing-related lending activities; |
• | require certain lender banks to collect and report applicant and borrower data regarding loans for home purchase or improvement projects; |
• | require lenders to provide borrowers with information regarding the nature and cost of real estate settlements; |
• | prohibit certain lending practices and limit escrow account amounts with respect to real estate transactions; and |
• | prescribe penalties for violations of the requirements of consumer protection statutes and regulations. |
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(Woodbridge)
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(Woodbridge)
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(Woodbridge)
Closed | Non- | Third | ||||||||||||||||||||||||||||||||||
Date | Acres | Acres | Current | Saleable | Saleable | Party | Acres | |||||||||||||||||||||||||||||
Acquired | Acquired | (a) | Inventory | Acres (b) | Acres (b) | Backlog | Available | |||||||||||||||||||||||||||||
Currently in Development | ||||||||||||||||||||||||||||||||||||
Tradition, Florida | 1998 - 2004 | 8,246 | 1,831 | 6,415 | 2,583 | 3,832 | — | 3,832 | ||||||||||||||||||||||||||||
Tradition Hilton Head | 2005 | 5,390 | 166 | 5,224 | 2,417 | 2,807 | 10 | 2,797 | ||||||||||||||||||||||||||||
Total Currently in Development | 13,636 | 1,997 | 11,639 | 5,000 | 6,639 | 10 | 6,629 | |||||||||||||||||||||||||||||
(a) | Closed acres for Tradition Hilton Head include 150 acres owned by Carolina Oak, a wholly owned subsidiary of Woodbridge. The revenue from this sale was eliminated in consolidation. | |
(b) | Actual saleable and non-saleable acres may vary over time due to changes in zoning, project design, or other factors. Non-saleable acres include, but are not limited to, areas set aside for roads, parks, schools, utilities, wetlands and other public purposes. |
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(Woodbridge)
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(Woodbridge)
Name | Position | Age | ||||
Alan B. Levan | Chairman of the Board and Chief Executive Officer (Principal Executive Officer) | 64 | ||||
John E. Abdo | Vice-Chairman of the Board | 65 | ||||
Seth M. Wise | President | 39 | ||||
John K. Grelle | Chief Financial Officer (Principal Accounting Officer) | 65 |
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(Woodbridge)
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• | limit the payment of dividends by BankAtlantic to BankAtlantic Bancorp; |
• | limit transactions between us, BankAtlantic, BankAtlantic Bancorp and the subsidiaries or affiliates of either; |
• | limit the activities of BankAtlantic, BankAtlantic Bancorp or us; or |
• | impose capital requirements on us or BankAtlantic Bancorp. |
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• | general economic conditions, and the disruptions in the financial markets which have adversely impacted consumer spending patterns and the availability and cost of credit may continue to impact Benihana or deteriorate further; |
• | the failure of existing or new restaurants to perform as expected; |
• | The inability to construct new restaurants and remodel existing restaurants within projected budgets and time periods; |
• | increases in the minimum wage; |
• | intense competition in the restaurant industry; |
• | the food service industry is affected by litigation and publicity concerning food quality, health and other issues, which could cause customers to avoid a particular restaurant, result in significant liabilities or litigation costs or damage reputation or brand recognition; and |
• | Implementing growth and renovation strategies may strain available resources. |
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(BankAtlantic Bancorp)
• | BankAtlantic’s borrowers may be unable to make timely repayments of their loans, or the value of real estate collateral securing the payment of such loans may decrease which could result in increased delinquencies, foreclosures and customer bankruptcies, any of which would increase levels of non-performing loans resulting in significant credit losses, increased expenses and could have a material adverse effect on our operating results. |
• | Further disruptions in the capital markets or other events, including actions by rating agencies and deteriorating investor expectations, may result in an inability to borrow on favorable terms or at all from other financial institutions or government entities. |
• | Increased regulation of the industry may increase costs and limit BankAtlantic’s activities and operations. |
• | Increased competition among financial services companies based on the recent consolidation of competing financial institutions and the conversion of investment banks into bank holding companies, may adversely affect BankAtlantic’s ability to market its products and services. |
• | BankAtlantic may be required to pay significantly higher FDIC deposit premiums and assessments. |
• | Consumer confidence in the financial industry has weakened and individual wealth has deteriorated, which could lead to declines in deposits and impact liquidity. |
• | Continued asset valuation declines could adversely impact our credit losses and result in additional goodwill and other asset impairments. |
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(BankAtlantic Bancorp)
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(BankAtlantic Bancorp)
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(BankAtlantic Bancorp)
• | the risk characteristics of various classifications of loans; |
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(BankAtlantic Bancorp)
• | previous loan loss experience; | ||
• | specific loans that have probable loss potential; | ||
• | delinquency trends; | ||
• | estimated fair value of the collateral; | ||
• | current economic conditions; | ||
• | the views of its regulators; and | ||
• | geographic and industry loan concentrations. |
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(BankAtlantic Bancorp)
• | interest income on interest-earning assets, such as loans; and | ||
• | interest expense on interest-bearing liabilities, such as deposits. |
• | it amortizes premiums on acquired loans and securities, and if loans or securities are prepaid, the unamortized premium will be charged off; and | ||
• | the yields it earns on the investment of funds that it receives from prepaid loans and securities are generally less than the yields that it earned on the prepaid loans. |
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(BankAtlantic Bancorp)
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(BankAtlantic Bancorp)
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(BankAtlantic Bancorp)
• | limit the payment of dividends by BankAtlantic to the Company; |
• | limit transactions between the Company, BankAtlantic and the subsidiaries or affiliates of either; |
• | limit the Company’s activities and the activities of BankAtlantic; or |
• | Impose capital requirements on the Company or additional capital requirements on BankAtlantic. |
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(Woodbridge)
• | overbuilding or decreases in demand to acquire land; |
• | the availability and cost of financing; |
• | unfavorable interest rates and increases in inflation; |
• | changes in national, regional and local economic conditions; |
• | cost overruns, inclement weather, and labor and material shortages; |
• | the impact of present or future environmental legislation, zoning laws and other regulations; |
• | availability, delays and costs associated with obtaining permits, approvals or licenses necessary to develop property; and |
• | increases in real estate taxes, insurance and other local government fees. |
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(Woodbridge)
• | the risk that a significant tenant or a number of tenants may file for bankruptcy protection, creating the possibility that past due rents may never be recovered; |
• | the risk that leases with certain existing tenants may become overly burdensome to the lessee due to reduced business activity, and lease concessions and modifications may be necessary to avoid defaults; |
• | the risk that the current adverse economic conditions and limited availability of credit may continue or deteriorate further, causing market capitalization rates on commercial properties to increase beyond present levels, thus reducing the value at which commercial projects can be sold; |
• | the risk that net operating income at the commercial leasing projects may not be sufficient to meet certain debt service coverage ratio requirements, which would result in requirements for additional principal curtailment payments in order to bring the loans into compliance; and |
• | the risk that vacant space will take longer to lease and that rental rates will be lower than projected or necessary to operate the project profitably. |
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(Woodbridge)
• | shortages or increases in prices of construction materials; |
• | natural disasters in the areas in which we operate; |
• | lack of availability of adequate utility infrastructure and services; and |
• | our need to rely on local subcontractors who may not be adequately capitalized or insured. |
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(Woodbridge)
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(Woodbridge)
• | environmental matters, including the presence of hazardous or toxic substances; |
• | wetland preservation; |
• | health and safety; |
• | zoning, land use and other entitlements; |
• | building design; and |
• | density levels. |
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(Woodbridge)
• | the installation of utility services such as gas, electric, water and waste disposal; |
• | the dedication of acreage for open space, parks and schools; |
• | permitted land uses; and |
• | the construction design, methods and materials used. |
• | establish building moratoriums; |
• | limit the number of commercial properties that may be built; |
• | change building codes and construction requirements affecting property under construction; |
• | increase the cost of development and construction; and |
• | delay development and construction. |
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(Woodbridge)
• | the cyclical nature of the real estate industry; |
• | prevailing interest rates and the availability of financing; |
• | weather; |
• | cost and availability of materials and labor; |
• | competitive conditions; |
• | timing of sales of land; |
• | the timing of receipt of regulatory and other governmental approvals for land development projects; and |
• | the timing of the sale of our commercial leasing operations. |
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Miami - | Palm | Tampa | ||||||||||||||
Dade | Broward | Beach | Bay | |||||||||||||
Owned full-service stores | 9 | 13 | 25 | 7 | ||||||||||||
Leased full-service stores | 13 | 11 | 5 | 6 | ||||||||||||
Ground leased full-service stores (1) | 2 | 3 | 1 | 6 | ||||||||||||
Total full-service stores | 24 | 27 | 31 | 19 | ||||||||||||
Lease expiration dates | 2009-2026 | 2009-2015 | 2011-2014 | 2009-2026 | ||||||||||||
Ground lease expiration dates | 2026-2027 | 2017-2072 | 2026 | 2026-2032 | ||||||||||||
(1) | Stores in which BankAtlantic owns the building and leases the land. |
Miami - | Palm | Tampa | Orlando / | |||||||||||||||||
Dade | Broward | Beach | Bay | Jacksonville | ||||||||||||||||
Leased drive-through facilities | 1 | 2 | — | — | — | |||||||||||||||
Leased drive through expiration dates | 2010 | 2011-2014 | — | — | — | |||||||||||||||
Leased back-office facilities | — | 2 | — | 1 | 1 | |||||||||||||||
Leased back-office expiration dates | — | 2009-2011 | — | 2011 | 2013 | |||||||||||||||
Leased loan production facilities | 1 | — | — | — | — | |||||||||||||||
Leased loan production expiration dates | 2009 | — | — | — | — | |||||||||||||||
Miami - | Palm | Tampa | Orlando / | |||||||||||||||||
Dade | Broward | Beach | Bay | Jacksonville | ||||||||||||||||
Executed leases for new stores | — | 1 | 1 | — | — | |||||||||||||||
Executed lease expiration dates | — | 2030 | 2029 | — | — | |||||||||||||||
Executed leases held for sublease | — | 1 | — | 5 | 2 | |||||||||||||||
Executed lease expiration dates | — | 2013 | — | 2010-2048 | 2028-2029 | |||||||||||||||
Land held for sale | — | — | 1 | 1 | 4 | |||||||||||||||
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AND ISSUER PURCHASES OF EQUITY SECURITIES
• | Each share of Class A Common Stock is entitled to one vote for each share held, with all holders of Class A Common Stock possessing in the aggregate 22% of the total voting power. Holders of Class B Common Stock have the remaining 78% of the total voting power. If the number of shares of Class B Common Stock outstanding decreases to 1,800,000 shares, the Class A Common Stock aggregate voting power will change to 40% and the Class B Common Stock will have the remaining 60%. If the number of shares of Class B Common Stock outstanding decreases to 1,400,000 shares, the Class A Common Stock aggregate voting power will change to 53% and the Class B Common Stock will have the remaining 47%. If the number of shares of Class B Common Stock outstanding decreases to 500,000, the fixed voting percentages will be eliminated; and | ||
• | Each share of Class B Common Stock is convertible at the option of the holder thereof into one share of Class A Common Stock. |
Class A Common Stock: | High | Low | ||||||
2007 | ||||||||
First Quarter | $ | 6.75 | $ | 4.31 | ||||
Second Quarter | 4.50 | 3.59 | ||||||
Third Quarter | 4.04 | 2.22 | ||||||
Fourth Quarter | 3.38 | 1.16 | ||||||
2008 | ||||||||
First Quarter | $ | 1.56 | $ | .50 | ||||
Second Quarter | 1.26 | .57 | ||||||
Third Quarter | 1.04 | .45 | ||||||
Fourth Quarter | .68 | .12 |
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Class B Common Stock: | High | Low | ||||||
2007 | ||||||||
First Quarter | $ | 6.10 | $ | 5.00 | ||||
Second Quarter | 4.65 | 3.60 | ||||||
Third Quarter | 3.50 | 2.25 | ||||||
Fourth Quarter | 3.00 | 1.10 | ||||||
2008 | ||||||||
First Quarter | $ | 1.50 | $ | 1.08 | ||||
Second Quarter | 1.20 | .65 | ||||||
Third Quarter | .75 | .52 | ||||||
Fourth Quarter | .55 | .25 |
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Total Number of | Maximum Number of | |||||||||||||||
Shares Purchased as | Shares that | |||||||||||||||
Part of Publicly | May Yet Be Purchased | |||||||||||||||
Total Number of | Average price | Announced Plans | Under the Plans or | |||||||||||||
Period | Shares Purchased | per share | or Programs | Programs | ||||||||||||
October 1, 2008 through October 31, 2008 | 11,447 | $ | 0.55 | 11,447 | 1,650,000 | |||||||||||
November 1, 2008 through November 30, 2008 | — | — | — | 1,650,000 | ||||||||||||
December 1, 2008 through December 31, 2008 | — | — | — | 1,650,000 | ||||||||||||
Total | 11,447 | $ | 0.55 | 11,447 | 1,650,000 | |||||||||||
Number of securities | ||||||||||||
Remaining available for | ||||||||||||
Number of securities to | Weighted-average | future issuance under | ||||||||||
be issued upon exercise | exercise price of | equity compensation plans | ||||||||||
of outstanding options | of outstanding options | (excluding outstanding | ||||||||||
Plan category | warrants or rights | warrants or rights | options) | |||||||||
Equity compensation plans approved by security holders | 1,797,960 | $4.57 | 2,015,804 | |||||||||
Equity compensation plans not approved by security holders | — | — | — | |||||||||
Total | 1,797,960 | $4.57 | 2,015,804 | |||||||||
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For the Years Ended December 31, | ||||||||||||||||||||
2008 | 2007 | 2006 | 2005 | 2004 | ||||||||||||||||
Income Statement | ||||||||||||||||||||
Revenues | ||||||||||||||||||||
BFC Activities | $ | 4,408 | 6,109 | 3,682 | 3,129 | 5,683 | ||||||||||||||
Financial Services | 449,571 | 520,793 | 507,746 | 445,537 | 358,703 | |||||||||||||||
Real Estate Development | 33,491 | 431,665 | 583,152 | 574,824 | 558,838 | |||||||||||||||
487,470 | 958,567 | 1,094,580 | 1,023,490 | 923,224 | ||||||||||||||||
Costs and Expenses | ||||||||||||||||||||
BFC Activities | 12,139 | 15,015 | 12,370 | 9,665 | 7,452 | |||||||||||||||
Financial Services | 634,970 | 579,458 | 474,311 | 381,916 | 280,431 | |||||||||||||||
Real Estate Development | 72,751 | 697,895 | 606,655 | 498,760 | 481,627 | |||||||||||||||
719,860 | 1,292,368 | 1,093,336 | 890,341 | 769,510 | ||||||||||||||||
Equity in earnings from unconsolidated affiliates | 15,064 | 12,724 | 10,935 | 13,404 | 19,603 | |||||||||||||||
Impairment of unconsolidated affiliates | (96,579 | ) | — | — | — | — | ||||||||||||||
Impairment of investments | (15,548 | ) | — | — | — | — | ||||||||||||||
(Loss) income from continuing operations | (329,453 | ) | (321,077 | ) | 12,179 | 146,553 | 173,317 | |||||||||||||
Less: (Benefit) provision for income taxes | 15,763 | (69,012 | ) | (530 | ) | 59,566 | 70,917 | |||||||||||||
Less: Noncontrolling interest | (272,711 | ) | (218,165 | ) | 13,406 | 79,267 | 90,383 | |||||||||||||
(Loss) income from continuing operations | (72,505 | ) | (33,900 | ) | (697 | ) | 7,720 | 12,017 | ||||||||||||
(Loss) income from discontinued operations, net of noncontrolling interest and income taxes | 4,461 | 1,038 | (1,524 | ) | 5,054 | 2,213 | ||||||||||||||
Extraordinary gain, net of income taxes | 9,145 | 2,403 | — | — | — | |||||||||||||||
Net (loss) income | (58,899 | ) | (30,459 | ) | (2,221 | ) | 12,774 | 14,230 | ||||||||||||
Preferred Stock dividends | (750 | ) | (750 | ) | (750 | ) | (750 | ) | (392 | ) | ||||||||||
Net (loss) income allocable to common stock | $ | (59,649 | ) | (31,209 | ) | (2,971 | ) | 12,024 | 13,838 | |||||||||||
Common Share Data (a), (b), ( c) Basic (loss) earnings per share: | ||||||||||||||||||||
Basic (loss) earnings per share from continuing operations | $ | (1.62 | ) | (0.90 | ) | (0.04 | ) | 0.24 | 0.48 | |||||||||||
Discontinued operations | 0.10 | 0.03 | (0.05 | ) | 0.18 | 0.09 | ||||||||||||||
Extraordinary items | 0.20 | 0.06 | — | — | — | |||||||||||||||
Basic (loss) earnings per share of common stock | $ | (1.32 | ) | (0.81 | ) | (0.09 | ) | 0.42 | 0.57 | |||||||||||
Diluted (loss) earnings per share: | ||||||||||||||||||||
Diluted (loss) earnings per share from continuing operations | $ | (1.62 | ) | (0.90 | ) | (0.05 | ) | 0.22 | 0.40 | |||||||||||
Discontinued operations | 0.10 | 0.03 | (0.05 | ) | 0.15 | 0.07 | ||||||||||||||
Extraordinary items | 0.20 | 0.06 | — | — | — | |||||||||||||||
Diluted (loss) earnings per share of common stock | $ | (1.32 | ) | (0.81 | ) | (0.10 | ) | 0.37 | 0.47 | |||||||||||
Basic weighted average number of common shares outstanding | 45,097 | 38,778 | 33,249 | 28,952 | 24,183 | |||||||||||||||
Diluted weighted average number of common shares outstanding | 45,097 | 38,778 | 33,249 | 31,219 | 27,806 |
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(Dollars in thousands, except for per share data)
December 31, | ||||||||||||||||||||
Balance Sheet (at period end) | 2008 | 2007 | 2006 | 2005 | 2004 | |||||||||||||||
Loans and leases and held for sale, net | $ | 4,317,645 | 4,528,538 | 4,603,505 | 4,628,744 | 4,561,073 | ||||||||||||||
Securities | $ | 979,417 | 1,191,173 | 1,081,980 | 1,064,857 | 1,082,985 | ||||||||||||||
Total assets | $ | 6,395,582 | 7,114,433 | 7,605,766 | 7,395,755 | 6,954,847 | ||||||||||||||
Deposits | $ | 3,926,368 | 3,953,405 | 3,867,036 | 3,752,676 | 3,457,202 | ||||||||||||||
Securities sold under agreements to repurchase and federal funds purchased | $ | 279,726 | 159,905 | 128,411 | 249,263 | 257,002 | ||||||||||||||
Other borrowings (d) | $ | 1,631,367 | 1,992,718 | 2,398,662 | 2,121,315 | 2,083,109 | ||||||||||||||
Shareholders’ equity | $ | 112,867 | 184,037 | 177,585 | 183,080 | 125,251 |
(a) | Since its inception, BFC has not paid any cash dividends on its common stock. | |
(b) | While the Company has two classes of common stock outstanding, the two-class method is not presented because the company’s capital structure does not provide for different dividend rates or other preferences, other than voting rights, between the two classes | |
(c) | Prior to the merger of I.R.E. Realty Advisory Group, Inc. (“I.R.E. RAG”) in November 2007, the 4,764,285 shares of the Company’s Class A Common Stock and 500,000 shares of the Company’s Class B Common Stock that were owned by I.R.E. RAG were considered outstanding, but because the Company owned 45.5% of the outstanding common stock of I.R.E. RAG, 2,165,367 shares of Class A Common Stock and 227,250 shares of Class B Common Stock were eliminated from the number of shares outstanding for purposes of computing earnings per share. | |
(d) | Other borrowings consist of FHLB advances, subordinated debentures, notes, bonds payable, secured borrowings, and junior subordinated debentures. Secured borrowings were recognized on loan participation agreements that constituted a legal sale of a portion of the loan but that were not qualified to be accounted for as a loan sale. |
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AND RESULTS OF OPERATIONS
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Percent | ||||||||||||
Shares | Percent of | of | ||||||||||
Owned | Ownership | Vote | ||||||||||
BankAtlantic Bancorp | ||||||||||||
Class A Common Stock (1) | 2,389,697 | 23.30 | % | 12.35 | % | |||||||
Class B Common Stock | 975,225 | 100.00 | % | 47.00 | % | |||||||
Total | 3,364,922 | 29.96 | % | 59.35 | % | |||||||
Woodbridge Holdings Corporation | ||||||||||||
Class A Common Stock (2) | 3,735,392 | 22.43 | % | 11.89 | % | |||||||
Class B Common Stock | 243,807 | 100.00 | % | 47.00 | % | |||||||
Total | 3,979,199 | 23.55 | % | 58.89 | % |
(1) | In August 2008 and December 2008, BFC purchased an aggregate of 400,000 shares and 323,848 shares, respectively, of BankAtlantic Bancorp’s Class A common stock on the open market for an aggregate purchase price of $2.8 million and $1.1 million, respectively. BFC’s August 2008 and December 2008 acquisitions of BankAtlantic Bancorp’s Class A common stock increased BFC’s ownership interest in BankAtlantic Bancorp by approximately 3.6% in August 2008 and 2.9% in December 2008 and increased BFC’s voting interest by approximately 2.1% in August 2008 and 1.6% in December 2008. The acquisitions of additional shares of BankAtlantic Bancorp have been accounted for as step acquisitions under the purchase method of accounting. See Note 2 for further information. | |
(2) | BFC’s percentage of vote includes 1,229,117 shares of Woodbridge’s Class A Common Stock which BFC had previously agreed not to vote (except in limited circumstances) pursuant to a letter agreement requested by Woodbridge in connection with the listing of its shares on the NYSE |
For the Years Ended December 31, | ||||||||||||
2008 | 2007 | 2006 | ||||||||||
BFC Activities | $ | 5,997 | 12,567 | (5,009 | ) | |||||||
Financial Services | (217,646 | ) | (30,012 | ) | 26,879 | |||||||
Real Estate Development | (133,567 | ) | (234,620 | ) | (9,143 | ) | ||||||
(345,216 | ) | (252,065 | ) | 12,727 | ||||||||
Noncontrolling interest | (272,711 | ) | (218,165 | ) | 13,422 | |||||||
Loss from continuing operations | (72,505 | ) | (33,900 | ) | (695 | ) | ||||||
Discontinued operations, less controlling interest and income tax | 4,461 | 1,038 | (1,526 | ) | ||||||||
Extraordinary gain, less income tax | 9,145 | 2,403 | — | |||||||||
Net loss | $ | (58,899 | ) | (30,459 | ) | (2,221 | ) | |||||
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• | a decrease in cash and cash equivalents of approximately $78.8 million was primarily as a result of (i) a net decrease in cash and cash equivalents of $9.2 million at BFC, which resulted primarily from cash used in operations of approximately $5.8 million and cash used in investing activities of $2.5 million and (ii) Woodbridge’s net decrease in cash and cash equivalents of $80.4 million, which resulted from cash used in operations of $32.9 million, cash used in investing activities of $41.9 million and cash used in financing activities of $5.6 million. This decrease in cash and cash equivalents was offset in part by BankAtlantic Bancorp’s higher cash and due from depository institution balances resulting from additional cash at automated teller machines and cash on hand; | ||
• | an increase in BankAtlantic federal funds sold and short term investments associated with daily treasury management; | ||
• | an increase in Woodbridge’s restricted cash primarily related to the funding of the Levitt and Sons Settlement Agreement, providing collateral for a letter of credit as a result of a surety bond claim and the establishment of an interest reserve for one of Core’s loan agreements; | ||
• | a decrease in securities available for sale and other financial instruments reflecting BankAtlantic Bancorp’s sale of Stifel common stock, the sale of Stifel warrants and the liquidation of managed fund equity investments and principal repayments on agency securities. This decrease in securities available for sale was offset in part by Woodbridge’s net increase of equity securities of $4.3 million (net of shares sold and impairment charges) relating to its investment in Office Depot and BFC’s net increase in the reclassification of its investment in Benihana Convertible Preferred Stock from investment securities which was carried at cost to investment securities available for sale in accordance with SFAS No. 115, “Accounting for Certain Investments in Debt and Equity Securities.” (See Note 12 for further information); | ||
• | a decrease in investment securities at cost primarily resulting from BankAtlantic Bancorp’s sale of Stifel common stock and certain private equity securities and BFC’s reclassification of its investment in Benihana Convertible Preferred Stock as discussed above; | ||
• | increase in tax certificate balances in BankAtlantic primarily due to higher Florida tax certificate acquisitions; | ||
• | a decline in BankAtlantic FHLB stock related to lower FHLB advance borrowings; | ||
• | a decrease in BankAtlantic loan receivable balances associated with a $43.2 million increase in the allowance for loan losses as well as lower residential loan balances partially offset by higher small business, commercial business and home equity loan balances; | ||
• | lower real estate held for development and sale held by BankAtlantic associated with impairments and the sale of inventory of homes at a real estate development. This decrease in inventory of real estate was partially offset by a net increase of inventory held by Woodbridge of $14.0 million primarily associated with the land development activities of the Land Division; | ||
• | a decrease in office properties and equipment primarily due to the sale by BankAtlantic of five central Florida branches to an unrelated financial institution as well as the disposal of properties in connection with the on-going consolidation of back-office facilities, as well as a decrease in Woodbridge property and equipment due to the sale of three ground lease parcels and a depreciation adjustment related to the reclassification into continuing operations of two of Core’s commercial leasing assets previously classified as discontinued operations; | ||
• | a decrease in BankAtlantic’s goodwill associated with the recognition of a $46.6 million goodwill impairment (net of purchase accounting of $1.7 million); | ||
• | a decrease in deferred tax assets, net due to the establishment of a deferred tax asset valuation allowance; | ||
• | an increase in other intangible assets primarily associated with core deposit intangible assets relating to BFC’s “step acquisitions” in BankAtlantic Bancorp in August 2008 and December 2008, which increased BFC’s economic ownership in BankAtlantic Bancorp in the aggregate by approximately 6.5%. Such acquisitions were accounted as step acquisitions under the purchase method. The increase in other intangible assets was also due to Woodbridge’s intangible assets of approximately $4.3 million associated with its acquisition of shares of convertible preferred stock of Pizza Fusion; |
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• | a decline in other assets primarily resulting from BankAtlantic Bancorp’s and Woodbridge’s receipt of income tax refunds associated with the carry-back of taxable losses for the year ended December 31, 2007. |
• | lower non-interest-bearing deposit balances primarily reflecting the migration of non-interest bearing deposits to interest-bearing NOW accounts as BankAtlantic promoted higher interest rate NOW accounts during 2008 in response to greater competition; | ||
• | decline in BankAtlantic insured savings and money market accounts primarily reflecting deposit outflows resulting from interest rate reductions on higher yield account products as higher rates from prior periods were discontinued; | ||
• | an increase in BankAtlantic’s certificate accounts reflecting higher brokered deposit balances as well as a higher interest rate certificate account promotion during 2008; | ||
• | lower FHLB advance borrowings at BankAtlantic due to a decline in total assets and the availability of alternative funding sources at lower interest rates; | ||
• | higher short-term borrowings at BankAtlantic associated with funds obtained from the Treasury at lower interest rates than alternate funding sources; | ||
• | a decrease in Woodbridge’s notes and mortgage notes payable primarily due to curtailment payments made in connection with a development loan collateralized by land in Tradition Hilton Head, offset in part by draws on lines of credit in Woodbridge’s Land Division; and | ||
• | decreases in other liabilities primarily resulting from a decline at BankAtlantic in accrued interest payable on borrowings associated with significantly lower interest rates at period end, as well as a decrease in accrued liabilities at Woodbridge which was primarily attributable to decreased severance and construction accruals due to payments made during the year ended December 31, 2008, partially offset by an increase in Woodbridge’s current tax liability of approximately $2.4 million relating to its FIN 48 liability which was netted against current tax asset in 2007. |
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December 31, | ||||||||
2008 | 2007 | |||||||
BankAtlantic Bancorp | $ | 170,888 | 351,148 | |||||
Woodbridge | 91,389 | 207,138 | ||||||
Joint Venture Partnership | 277 | 664 | ||||||
$ | 262,554 | 558,950 | ||||||
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Change | Change | |||||||||||||||||||
For the Years Ended December 31, | 2008 vs. | 2007 vs. | ||||||||||||||||||
(In thousands) | 2008 | 2007 | 2006 | 2007 | 2006 | |||||||||||||||
Revenues | ||||||||||||||||||||
Interest and dividend income | $ | 1,376 | 2,374 | 2,292 | (998 | ) | 82 | |||||||||||||
Securities activities | 898 | 1,295 | — | (397 | ) | 1,295 | ||||||||||||||
Other income, net | 4,955 | 4,977 | 3,680 | (22 | ) | 1,297 | ||||||||||||||
7,229 | 8,646 | 5,972 | (1,417 | ) | 2,674 | |||||||||||||||
Cost and Expenses | ||||||||||||||||||||
Employee compensation and benefits | 8,793 | 10,932 | 9,407 | (2,139 | ) | 1,525 | ||||||||||||||
Other expenses, net | 3,600 | 4,340 | 3,428 | (740 | ) | 912 | ||||||||||||||
12,393 | 15,272 | 12,835 | (2,879 | ) | 2,437 | |||||||||||||||
Equity in loss from unconsolidated affiliates | (152 | ) | (78 | ) | — | (74 | ) | (78 | ) | |||||||||||
Impairment of investment | (3,574 | ) | — | — | (3,574 | ) | — | |||||||||||||
Loss before income taxes | (8,890 | ) | (6,704 | ) | (6,863 | ) | (2,186 | ) | 159 | |||||||||||
Benefit for income taxes | (14,887 | ) | (19,271 | ) | (1,857 | ) | 4,384 | (17,414 | ) | |||||||||||
Noncontrolling interest | 12 | (34 | ) | (25 | ) | 46 | (9 | ) | ||||||||||||
Income (loss) from continuing operations | $ | 5,985 | 12,601 | (4,981 | ) | (6,616 | ) | 17,582 | ||||||||||||
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For the Years Ended December 31, | ||||||||||||
2008 | 2007 | 2006 | ||||||||||
BFC Activities loss before income taxes | $ | (8,901 | ) | (6,670 | ) | (6,838 | ) | |||||
Subsidiaries not consolidated for income taxes: | ||||||||||||
Equity from (loss) earnings in BankAtlantic Bancorp | (56,230 | ) | (7,206 | ) | 5,807 | |||||||
Equity from loss in Woodbridge | (22,261 | ) | (39,622 | ) | (1,519 | ) | ||||||
Loss before income taxes | (87,392 | ) | (53,498 | ) | (2,550 | ) | ||||||
Benefit for income taxes | (14,887 | ) | (19,271 | ) | (1,857 | ) | ||||||
Net loss | $ | (72,505 | ) | (34,227 | ) | (693 | ) | |||||
Effective tax rate | 17 | % | 36 | % | 73 | % |
For the Years Ended December 31, | ||||||||||||
2008 | 2007 | 2006 | ||||||||||
Net cash provided by (used in): | ||||||||||||
Operating activities | $ | (5,859 | ) | (3,267 | ) | (2,292 | ) | |||||
Investing activities | (2,495 | ) | (31,548 | ) | (1,416 | ) | ||||||
Financing activities | (825 | ) | 35,537 | (4,922 | ) | |||||||
Increase (decrease) in cash and cash equivalents | (9,179 | ) | 722 | (8,630 | ) | |||||||
Cash and cash equivalents at beginning of period | 18,898 | 18,176 | 26,806 | |||||||||
Cash and cash equivalents at end of period | $ | 9,719 | 18,898 | 18,176 | ||||||||
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• | Revenues from shared services activities for affiliated companies; | ||
• | Dividends from Benihana; | ||
• | Venture partnership distribution; | ||
• | Revenues from BFC/CCC; | ||
• | Proceeds from the sale of equity securities; and | ||
• | Dividends from BankAtlantic Bancorp. |
• | Purchase shares of Woodbridge and BankAtlantic Bancorp Class A common stock as discussed in this report; | ||
• | Pay dividends on BFC’s outstanding 5% Preferred Stock; and | ||
• | Fund BFC’s operating and general and administrative expenses, including shared services costs. |
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For the Years Ended December 31, | ||||||||||||
2008 | 2007 | 2006 | ||||||||||
BankAtlantic | $ | (166,144 | ) | (19,440 | ) | 36,322 | ||||||
Parent Co. | (53,100 | ) | (10,572 | ) | (9,443 | ) | ||||||
Net (loss) income | $ | (219,244 | ) | (30,012 | ) | 26,879 | ||||||
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For the Years Ended | Change | Change | ||||||||||||||||||
Ended December 31, | 2008 vs | 2007 vs | ||||||||||||||||||
2008 | 2007 | 2006 | 2007 | 2006 | ||||||||||||||||
Net interest income | $ | 193,648 | 199,510 | 219,605 | (5,862 | ) | (20,095 | ) | ||||||||||||
Provision for loan losses | (135,383 | ) | (70,842 | ) | (8,574 | ) | (64,541 | ) | (62,268 | ) | ||||||||||
Net income after provision for loan losses | 58,265 | 128,668 | 211,031 | (70,403 | ) | (82,363 | ) | |||||||||||||
Non-interest income | 137,308 | 144,412 | 131,844 | (7,104 | ) | 12,568 | ||||||||||||||
Non-interest expense | (330,623 | ) | (313,898 | ) | (293,448 | ) | (16,725 | ) | (20,450 | ) | ||||||||||
BankAtlantic (loss) income before income taxes | (135,050 | ) | (40,818 | ) | 49,427 | (94,232 | ) | (90,245 | ) | |||||||||||
(Provision)/benefit for income taxes | (31,094 | ) | 21,378 | (13,105 | ) | (52,472 | ) | 34,483 | ||||||||||||
BankAtlantic net (loss) contribution | $ | (166,144 | ) | (19,440 | ) | 36,322 | (146,704 | ) | (55,762 | ) | ||||||||||
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The following table summarizes net interest income:
For the Years Ended | ||||||||||||||||||||||||||||||||||||
December 31, 2008 | December 31, 2007 | December 31, 2006 | ||||||||||||||||||||||||||||||||||
Average | Revenue/ | Yield/ | Average | Revenue/ | Yield/ | Average | Revenue/ | Yield/ | ||||||||||||||||||||||||||||
(Dollars are in thousands) | Balance | Expense | Rate | Balance | Expense | Rate | Balance | Expense | Rate | |||||||||||||||||||||||||||
Interest earning assets | ||||||||||||||||||||||||||||||||||||
Loans: (a) | ||||||||||||||||||||||||||||||||||||
Residential real estate | $ | 2,053,645 | 111,691 | 5.44 | % | $ | 2,209,832 | 120,768 | 5.47 | % | $ | 2,099,664 | 109,103 | 5.20 | % | |||||||||||||||||||||
Commercial real estate | 1,238,307 | 69,642 | 5.62 | 1,367,095 | 108,931 | 7.97 | 1,530,282 | 128,420 | 8.39 | |||||||||||||||||||||||||||
Consumer | 743,863 | 33,950 | 4.56 | 650,764 | 47,625 | 7.32 | 558,769 | 41,997 | 7.52 | |||||||||||||||||||||||||||
Commercial business | 132,565 | 9,516 | 7.18 | 142,455 | 12,720 | 8.93 | 140,465 | 12,452 | 8.86 | |||||||||||||||||||||||||||
Small business | 320,853 | 22,162 | 6.91 | 298,774 | 23,954 | 8.02 | 259,816 | 20,988 | 8.08 | |||||||||||||||||||||||||||
Total loans | 4,489,233 | 246,961 | 5.50 | 4,668,920 | 313,998 | 6.73 | 4,588,996 | 312,960 | 6.82 | |||||||||||||||||||||||||||
Tax exempt securities (c) | — | — | — | 328,583 | 19,272 | 5.87 | 396,539 | 23,162 | 5.84 | |||||||||||||||||||||||||||
Taxable investment securities (b) | 1,078,189 | 65,570 | 6.08 | 689,263 | 42,849 | 6.22 | 618,913 | 36,912 | 5.96 | |||||||||||||||||||||||||||
Federal funds sold | 44,031 | 754 | 1.71 | 3,638 | 195 | 5.36 | 1,824 | 22 | 1.21 | |||||||||||||||||||||||||||
Total investment securities | 1,122,220 | 66,324 | 5.91 | 1,021,484 | 62,316 | 6.10 | 1,017,276 | 60,096 | 5.91 | |||||||||||||||||||||||||||
Total interest earning assets | 5,611,453 | 313,285 | 5.58 | % | 5,690,404 | 376,314 | 6.61 | % | 5,606,272 | 373,056 | 6.65 | % | ||||||||||||||||||||||||
Total non-interest earning assets | 503,028 | 510,173 | 448,296 | |||||||||||||||||||||||||||||||||
Total assets | $ | 6,114,481 | $ | 6,200,577 | $ | 6,054,568 | ||||||||||||||||||||||||||||||
Interest bearing liabilities | ||||||||||||||||||||||||||||||||||||
Deposits: | ||||||||||||||||||||||||||||||||||||
Savings | $ | 503,464 | 4,994 | 0.99 | % | $ | 584,542 | 12,559 | 2.15 | % | $ | 369,504 | 2,936 | 0.79 | % | |||||||||||||||||||||
NOW, money funds and checking | 1,506,479 | 17,784 | 1.18 | 1,450,960 | 26,031 | 1.79 | 1,502,058 | 20,413 | 1.36 | |||||||||||||||||||||||||||
Certificate accounts | 1,088,170 | 41,485 | 3.81 | 992,043 | 45,886 | 4.63 | 868,777 | 35,610 | 4.10 | |||||||||||||||||||||||||||
Total interest bearing deposits | 3,098,113 | 64,263 | 2.07 | 3,027,545 | 84,476 | 2.79 | 2,740,339 | 58,959 | 2.15 | |||||||||||||||||||||||||||
Securities sold under agreements to repurchase, federal funds and other short term borrowings | 141,654 | 2,699 | 1.91 | 194,222 | 9,829 | 5.06 | 304,635 | 15,309 | 5.03 | |||||||||||||||||||||||||||
Advances from FHLB | 1,417,718 | 50,942 | 3.59 | 1,379,106 | 73,256 | 5.31 | 1,265,772 | 66,492 | 5.25 | |||||||||||||||||||||||||||
Subordinated debentures and notes payable | 26,004 | 1,733 | 6.66 | 28,946 | 2,498 | 8.63 | 66,287 | 5,513 | 8.32 | |||||||||||||||||||||||||||
Total interest bearing liabilities | 4,683,489 | 119,637 | 2.55 | 4,629,819 | 170,059 | 3.67 | 4,377,033 | 146,273 | 3.34 | |||||||||||||||||||||||||||
Non-interest bearing liabilities | ||||||||||||||||||||||||||||||||||||
Demand deposit and escrow accounts | 828,825 | 946,356 | 1,056,254 | |||||||||||||||||||||||||||||||||
Other liabilities | 50,584 | 55,683 | 61,392 | |||||||||||||||||||||||||||||||||
Total non-interest bearing liabilities | 879,409 | 1,002,039 | 1,117,646 | |||||||||||||||||||||||||||||||||
Stockholders’ equity | 551,583 | 568,719 | 559,889 | |||||||||||||||||||||||||||||||||
Total liabilities and stockholders’ equity | $ | 6,114,481 | $ | 6,200,577 | $ | 6,054,568 | ||||||||||||||||||||||||||||||
Net interest income/net interest spread | 193,648 | 3.03 | % | 206,255 | 2.94 | % | 226,683 | 3.31 | % | |||||||||||||||||||||||||||
Tax equivalent adjustment | — | (6,745 | ) | (8,107 | ) | |||||||||||||||||||||||||||||||
Capitalized interest from real estate operations | — | — | 929 | |||||||||||||||||||||||||||||||||
Net interest income | 193,648 | 199,510 | 219,605 | |||||||||||||||||||||||||||||||||
Margin | ||||||||||||||||||||||||||||||||||||
Interest income/average interest earning assets | 5.58 | % | 6.61 | % | 6.65 | % | ||||||||||||||||||||||||||||||
Interest expense/average interest earning assets | 2.13 | 2.99 | 2.61 | |||||||||||||||||||||||||||||||||
Tax equivalent net interest margin | 3.45 | % | 3.62 | % | 4.04 | % | ||||||||||||||||||||||||||||||
(a) | Includes non-accruing loans | |
(b) | Average balances were based on amortized cost. | |
(c) | The tax equivalent basis is computed using a 35% tax rate. |
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Year Ended | Year Ended | |||||||||||||||||||||||
December 31, 2008 | December 31, 2007 | |||||||||||||||||||||||
Compared to Year Ended | Compared to Year Ended | |||||||||||||||||||||||
December 31, 2007 | December 31, 2006 | |||||||||||||||||||||||
Volume (a) | Rate | Total | Volume (a) | Rate | Total | |||||||||||||||||||
Increase (decrease) due to: | ||||||||||||||||||||||||
Loans | $ | (9,885 | ) | (57,152 | ) | (67,037 | ) | 5,375 | (4,337 | ) | 1,038 | |||||||||||||
Tax exempt securities | — | (19,272 | ) | (19,272 | ) | (3,986 | ) | 96 | (3,890 | ) | ||||||||||||||
Taxable investment securities (b) | 23,652 | (931 | ) | 22,721 | 4,373 | 1,564 | 5,937 | |||||||||||||||||
Federal funds sold | 692 | (133 | ) | 559 | 97 | 76 | 173 | |||||||||||||||||
Total earning assets | 14,459 | (77,488 | ) | (63,029 | ) | 5,859 | (2,601 | ) | 3,258 | |||||||||||||||
Deposits: | ||||||||||||||||||||||||
Savings | (804 | ) | (6,761 | ) | (7,565 | ) | 4,620 | 5,003 | 9,623 | |||||||||||||||
NOW, money funds, and checking | 655 | (8,902 | ) | (8,247 | ) | (917 | ) | 6,535 | 5,618 | |||||||||||||||
Certificate accounts | 3,665 | (8,066 | ) | (4,401 | ) | 5,702 | 4,574 | 10,276 | ||||||||||||||||
Total deposits | 3,516 | (23,729 | ) | (20,213 | ) | 9,405 | 16,112 | 25,517 | ||||||||||||||||
Securities sold under agreements to repurchase | (1,002 | ) | (6,128 | ) | (7,130 | ) | (5,588 | ) | 108 | (5,480 | ) | |||||||||||||
Advances from FHLB | 1,387 | (23,701 | ) | (22,314 | ) | 6,020 | 744 | 6,764 | ||||||||||||||||
Subordinated debentures | (196 | ) | (569 | ) | (765 | ) | (3,222 | ) | 207 | (3,015 | ) | |||||||||||||
189 | (30,398 | ) | (30,209 | ) | (2,790 | ) | 1,059 | (1,731 | ) | |||||||||||||||
Total interest bearing liabilities | 3,705 | (54,127 | ) | (50,422 | ) | 6,615 | 17,171 | 23,786 | ||||||||||||||||
Change in tax equivalent interest income | $ | 10,754 | (23,361 | ) | (12,607 | ) | (756 | ) | (19,772 | ) | (20,528 | ) | ||||||||||||
(a) | Changes attributable to rate/volume have been allocated to volume. | |
(b) | Average balances were based on amortized cost. |
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For the Years Ended December 31, | ||||||||||||||||||||
2008 | 2007 | 2006 | 2005 | 2004 | ||||||||||||||||
Balance, beginning of period | $ | 94,020 | 43,602 | 41,192 | 46,010 | 45,595 | ||||||||||||||
Charge-offs: | ||||||||||||||||||||
Commercial business loans | — | — | — | — | — | |||||||||||||||
Commercial real estate loans | (60,057 | ) | (12,562 | ) | (7,000 | ) | — | (645 | ) | |||||||||||
Small business | (4,886 | ) | (2,554 | ) | (951 | ) | (764 | ) | (238 | ) | ||||||||||
Consumer loans | (28,942 | ) | (7,065 | ) | (681 | ) | (259 | ) | (585 | ) | ||||||||||
Residential real estate loans | (4,816 | ) | (461 | ) | (239 | ) | (453 | ) | (582 | ) | ||||||||||
Continuing loan products | (98,701 | ) | (22,642 | ) | (8,871 | ) | (1,476 | ) | (2,050 | ) | ||||||||||
Discontinued loan products | — | — | (34 | ) | (1,218 | ) | (2,026 | ) | ||||||||||||
Total charge-offs | (98,701 | ) | (22,642 | ) | (8,905 | ) | (2,694 | ) | (4,076 | ) | ||||||||||
Recoveries: | ||||||||||||||||||||
Commercial business loans | 7 | 96 | 291 | 18 | 536 | |||||||||||||||
Commercial real estate loans | — | 304 | 419 | 1,471 | 4,052 | |||||||||||||||
Small business | 428 | 417 | 566 | 899 | 418 | |||||||||||||||
Consumer loans | 365 | 578 | 536 | 401 | 370 | |||||||||||||||
Residential real estate loans | 397 | 15 | 348 | 65 | 486 | |||||||||||||||
Continuing loan products | 1,197 | 1,410 | 2,160 | 2,854 | 5,862 | |||||||||||||||
Discontinued loan products | 113 | 808 | 581 | 1,637 | 3,738 | |||||||||||||||
Total recoveries | 1,310 | 2,218 | 2,741 | 4,491 | 9,600 | |||||||||||||||
Net (charge-offs) recoveries | (97,391 | ) | (20,424 | ) | (6,164 | ) | 1,797 | 5,524 | ||||||||||||
Provision for (recovery from) loan losses | 135,383 | 70,842 | 8,574 | (6,615 | ) | (5,109 | ) | |||||||||||||
Transfer specific reserves to Parent Company | (6,440 | ) | — | — | — | — | ||||||||||||||
Balance, end of period | $ | 125,572 | 94,020 | 43,602 | 41,192 | 46,010 | ||||||||||||||
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December 31, 2008 | December 31, 2007 | December 31, 2006 | ||||||||||||||||||||||||||||||||||
ALL | Loans | ALL | Loans | ALL | Loans | |||||||||||||||||||||||||||||||
to gross | by | to gross | by | to gross | by | |||||||||||||||||||||||||||||||
ALL | loans | category | ALL | loans | category | ALL | loans | category | ||||||||||||||||||||||||||||
by | in each | to gross | by | in each | to gross | by | in each | to gross | ||||||||||||||||||||||||||||
category | category | loans | category | category | loans | category | category | loans | ||||||||||||||||||||||||||||
Commercial business | $ | 3,173 | 2.22 | % | 3.15 | % | 2,668 | 2.04 | % | 2.65 | % | 2,359 | 1.50 | % | 3.07 | % | ||||||||||||||||||||
Commercial real estate | 75,850 | 5.44 | 30.69 | 72,948 | 4.51 | 32.78 | 24,632 | 1.28 | 37.54 | |||||||||||||||||||||||||||
Small business | 8,133 | 2.49 | 7.20 | 4,576 | 1.44 | 6.43 | 4,495 | 1.58 | 5.57 | |||||||||||||||||||||||||||
Residential real estate | 6,034 | 0.31 | 42.56 | 4,177 | 0.19 | 43.82 | 4,242 | 0.20 | 42.33 | |||||||||||||||||||||||||||
Consumer — direct | 32,382 | 4.35 | 16.40 | 9,651 | 1.37 | 14.32 | 7,874 | 1.34 | 11.49 | |||||||||||||||||||||||||||
Discontinued loan products | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||
Total assigned | 125,572 | 94,020 | 43,602 | |||||||||||||||||||||||||||||||||
Unassigned | — | N/A | N/A | — | N/A | N/A | — | N/A | N/A | |||||||||||||||||||||||||||
$ | 125,572 | 2.76 | 100.00 | 94,020 | 1.90 | 100.00 | 43,602 | 0.85 | 100.00 | |||||||||||||||||||||||||||
December 31, 2005 | December 31, 2004 | |||||||||||||||||||||||
ALL | Loans | ALL | Loans | |||||||||||||||||||||
to gross | by | to gross | by | |||||||||||||||||||||
ALL | loans | category | ALL | loans | category | |||||||||||||||||||
by | in each | to gross | by | in each | to gross | |||||||||||||||||||
category | category | loans | category | category | loans | |||||||||||||||||||
Commercial business | $ | 1,988 | 2.30 | % | 1.63 | % | 2,507 | 2.94 | % | 1.59 | % | |||||||||||||
Commercial real estate | 17,984 | 0.75 | 45.20 | 23,345 | 0.92 | 47.28 | ||||||||||||||||||
Small business | 2,640 | 1.12 | 4.43 | 2,403 | 1.26 | 3.55 | ||||||||||||||||||
Residential real estate | 2,592 | 0.13 | 38.53 | 2,565 | 0.12 | 38.57 | ||||||||||||||||||
Consumer — direct | 6,354 | 1.17 | 10.19 | 4,281 | 0.90 | 8.86 | ||||||||||||||||||
Discontinued loan products | 156 | 12.92 | 0.02 | 1,431 | 17.27 | 0.15 | ||||||||||||||||||
Total assigned | 31,714 | 36,532 | ||||||||||||||||||||||
Unassigned | 9,478 | N/A | N/A | 9,478 | N/A | N/A | ||||||||||||||||||
$ | 41,192 | 0.78 | 100.00 | 46,010 | 0.86 | 100.00 | ||||||||||||||||||
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December 31, | ||||||||||||||||||||
2008 | 2007 | 2006 | 2005 | 2004 | ||||||||||||||||
NONPERFORMING ASSETS | ||||||||||||||||||||
Tax certificates | $ | 1,441 | 2,094 | 632 | 388 | 381 | ||||||||||||||
Residential | 34,734 | 8,678 | 2,629 | 5,981 | 5,538 | |||||||||||||||
Commercial (2)(3) | 161,947 | 165,818 | — | 340 | 1,067 | |||||||||||||||
Small business | 4,644 | 877 | 244 | 9 | 88 | |||||||||||||||
Consumer | 6,763 | 3,218 | 1,563 | 471 | 1,210 | |||||||||||||||
Total non-accrual assets | 209,529 | 180,685 | 5,068 | 7,189 | 8,284 | |||||||||||||||
Residential real estate owned | 2,285 | 413 | 617 | 86 | 309 | |||||||||||||||
Commercial real estate owned | 16,500 | 16,763 | 21,130 | 881 | 383 | |||||||||||||||
Small business real estate owned | 260 | — | — | — | — | |||||||||||||||
Consumer | — | 40 | — | — | — | |||||||||||||||
Total repossessed assets | 19,045 | 17,216 | 21,747 | 967 | 692 | |||||||||||||||
Total nonperforming assets | $ | 228,574 | 197,901 | 26,815 | 8,156 | 8,976 | ||||||||||||||
Total nonperforming assets as a percentage of: | ||||||||||||||||||||
Total assets | 4.00 | 3.21 | 0.43 | 0.13 | 0.15 | % | ||||||||||||||
Loans, tax certificates and real estate owned | 4.95 | 4.10 | 0.55 | 0.17 | 0.19 | % | ||||||||||||||
TOTAL ASSETS | $ | 5,713,690 | 6,161,962 | 6,187,122 | 6,109,330 | 6,044,988 | ||||||||||||||
TOTAL LOANS, TAX CERTIFICATES AND NET REAL ESTATE OWNED | $ | 4,614,892 | 4,823,825 | 4,903,961 | 4,830,268 | 4,771,682 | ||||||||||||||
Allowance for loan losses | $ | 125,572 | 94,020 | 43,602 | 41,192 | 46,010 | ||||||||||||||
Tax certificates | $ | 213,534 | 188,401 | 199,090 | 166,697 | 170,028 | ||||||||||||||
Allowance for tax certificate losses | $ | 6,064 | 3,289 | 3,699 | 3,271 | 3,297 | ||||||||||||||
OTHER POTENTIAL PROBLEM LOANS | ||||||||||||||||||||
Contractually past due 90 days or more (1) | $ | 15,721 | — | — | — | — | ||||||||||||||
Performing impaired loans | — | — | 163 | 193 | 320 | |||||||||||||||
Restructured loans | 25,843 | 2,488 | — | 77 | 24 | |||||||||||||||
TOTAL POTENTIAL PROBLEM LOANS | $ | 41,564 | 2,488 | 163 | 270 | 344 | ||||||||||||||
(1) | The majority of these loans have matured and the borrower continues to make payments under the matured loan agreement. | |
(2) | $121.9 million of impaired loans had specific reserves of $29.2 million and no additional specific reserves were determined to be required on the remaining impaired loans. | |
(3) | Excluded from the above table as of December 31, 2008 were $79.3 million of residential commercial loans that were transferred to a work-out subsidiary of the Parent Company in March 2008. |
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For the Years Ended | Change | Change | ||||||||||||||||||
December 31, | 2008 vs | 2007 vs | ||||||||||||||||||
2008 | 2007 | 2006 | 2007 | 2006 | ||||||||||||||||
Service charges on deposits | $ | 93,905 | 102,639 | 90,472 | (8,734 | ) | 12,167 | |||||||||||||
Other service charges and fees | 28,959 | 28,950 | 27,542 | 9 | 1,408 | |||||||||||||||
Securities activities, net | 2,395 | 2,307 | 657 | 88 | 1,650 | |||||||||||||||
Income from unconsolidated subsidiaries | 1,509 | 1,219 | 33 | 290 | 1,186 | |||||||||||||||
Gains associated with debt redemption | — | — | 1,528 | — | (1,528 | ) | ||||||||||||||
(Losses) gains on dispositions of office properties and equipment, net | (213 | ) | (1,121 | ) | 1,627 | 908 | (2,748 | ) | ||||||||||||
Gains on sales of loans | 265 | 494 | 680 | (229 | ) | (186 | ) | |||||||||||||
Other | 10,488 | 9,924 | 9,305 | 564 | 619 | |||||||||||||||
Non-interest income | $ | 137,308 | 144,412 | 131,844 | (7,104 | ) | 12,568 | |||||||||||||
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For the Years Ended | Change | Change | ||||||||||||||||||
December 31, | 2008 vs | 2007 vs | ||||||||||||||||||
2008 | 2007 | 2006 | 2007 | 2006 | ||||||||||||||||
Employee compensation and benefits | $ | 125,851 | 148,758 | 146,099 | (22,907 | ) | 2,659 | |||||||||||||
Occupancy and equipment | 64,774 | 65,840 | 57,291 | (1,066 | ) | 8,549 | ||||||||||||||
Advertising and promotion | 16,056 | 19,684 | 34,659 | (3,628 | ) | (14,975 | ) | |||||||||||||
Check losses | 8,767 | 11,476 | 8,615 | (2,709 | ) | 2,861 | ||||||||||||||
Professional fees | 10,979 | 8,266 | 7,653 | 2,713 | 613 | |||||||||||||||
Supplies and postage | 4,580 | 6,078 | 6,833 | (1,498 | ) | (755 | ) | |||||||||||||
Telecommunication | 4,430 | 5,552 | 4,774 | (1,122 | ) | 778 | ||||||||||||||
Amortization of intangible assets | 1,359 | 1,437 | 1,561 | (78 | ) | (124 | ) | |||||||||||||
Cost associated with debt redemption | 1,238 | — | 1,457 | 1,238 | (1,457 | ) | ||||||||||||||
Provision for tax certificates | 7,286 | 300 | 300 | 6,986 | — | |||||||||||||||
Restructuring charges, impairments and exit activities | 7,395 | 8,351 | — | (956 | ) | 8,351 | ||||||||||||||
Impairment of real estate held for sale | 1,169 | 5,240 | — | (4,071 | ) | 5,240 | ||||||||||||||
Impairment of real estate owned | 1,465 | 7,299 | 9 | (5,834 | ) | 7,290 | ||||||||||||||
Impairment of goodwill | 48,284 | — | — | 48,284 | — | |||||||||||||||
Other | 26,990 | 25,617 | 24,197 | 1,373 | 1,420 | |||||||||||||||
Total non-interest expense | $ | 330,623 | 313,898 | 293,448 | 16,725 | 20,450 | ||||||||||||||
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For the Years Ended | Change | Change | ||||||||||||||||||
December 31, | 2008 vs | 2007 vs | ||||||||||||||||||
($ in thousands) | 2008 | 2007 | 2006 | 2007 | 2006 | |||||||||||||||
(Loss) income before income taxes | $ | (135,050 | ) | (40,818 | ) | 49,427 | (94,232 | ) | (90,245 | ) | ||||||||||
(Provision) benefit for income taxes | (31,094 | ) | 21,378 | (13,105 | ) | (52,472 | ) | 34,483 | ||||||||||||
BankAtlantic net (loss) income | $ | (166,144 | ) | (19,440 | ) | 36,322 | (146,704 | ) | (55,762 | ) | ||||||||||
Effective tax rate | -23.02 | % | 52.37 | % | 26.51 | % | ||||||||||||||
For the Years Ended | Change | Change | ||||||||||||||||||
December 31, | 2008 vs | 2007 vs | ||||||||||||||||||
2008 | 2007 | 2006 | 2007 | 2006 | ||||||||||||||||
Net interest income (expense): | ||||||||||||||||||||
Interest income on loans | $ | 261 | — | — | 261 | — | ||||||||||||||
Interest and dividend income on investments | 1,184 | 2,320 | 2,448 | (1,136 | ) | (128 | ) | |||||||||||||
Interest expense on Junior subordinated debentures | (21,262 | ) | (23,054 | ) | (21,933 | ) | 1,792 | (1,121 | ) | |||||||||||
Net interest (expense) | (19,817 | ) | (20,734 | ) | (19,485 | ) | 917 | (1,249 | ) | |||||||||||
Provision for loan losses | (24,418 | ) | — | — | (24,418 | ) | — | |||||||||||||
Net interest (expense) after provision | (44,235 | ) | (20,734 | ) | (19,485 | ) | (23,501 | ) | (1,249 | ) | ||||||||||
Non-interest income: | ||||||||||||||||||||
Income from unconsolidated subsidiaries | 600 | 1,281 | 1,634 | (681 | ) | (353 | ) | |||||||||||||
Securities activities, net | (356 | ) | 6,105 | 9,156 | (6,461 | ) | (3,051 | ) | ||||||||||||
Other income | 1,027 | 824 | 23 | 203 | 801 | |||||||||||||||
Non-interest income | 1,271 | 8,210 | 10,813 | (6,939 | ) | (2,603 | ) | |||||||||||||
Non-interest expense: | ||||||||||||||||||||
Employee compensation and benefits | 3,046 | 2,421 | 4,705 | 625 | (2,284 | ) | ||||||||||||||
Advertising and promotion | 279 | 317 | 408 | (38 | ) | (91 | ) | |||||||||||||
Professional fees | 1,782 | 424 | 638 | 1,358 | (214 | ) | ||||||||||||||
Other | 3,634 | 1,080 | 1,028 | 2,554 | 52 | |||||||||||||||
Non-interest expense | 8,741 | 4,242 | 6,779 | 4,499 | (2,537 | ) | ||||||||||||||
Loss before income taxes | (51,705 | ) | (16,766 | ) | (15,451 | ) | (34,939 | ) | (1,315 | ) | ||||||||||
(Provision) benefit for income taxes | (1,395 | ) | 6,194 | 6,008 | (7,589 | ) | 186 | |||||||||||||
Parent Company loss | $ | (53,100 | ) | (10,572 | ) | (9,443 | ) | (42,528 | ) | (1,129 | ) | |||||||||
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(in thousands) | Amount | |||
Nonaccrual loans: | ||||
Commercial residential real estate: | ||||
Builder land loans | $ | 32,039 | ||
Land acquisition and development | 19,809 | |||
Land acquisition, development and construction | 34,915 | |||
Total commercial residential real estate | 86,763 | |||
Commercial non-residential real estate | 14,731 | |||
Total non-accrual loans | 101,494 | |||
Allowance for loan losses — specific reserves | (6,440 | ) | ||
Non-accrual loans, net | $ | 95,054 | ||
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December 31, | ||||
(in thousands) | 2008 | |||
Nonaccrual loans: | ||||
Commercial residential real estate: | ||||
Builder land loans | $ | 22,019 | ||
Land acquisition and development | 16,759 | |||
Land acquisition, development and construction | 29,163 | |||
Total commercial residential real estate | 67,941 | |||
Commercial non-residential real estate | 11,386 | |||
Total non-accrual loans | 79,327 | |||
Allowance for loan losses — specific reserves | (11,685 | ) | ||
Non-accrual loans, net | $ | 67,642 | ||
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• | Higher cash and due from depository institution balances resulting from additional cash at automated teller machines and cash on hand; | ||
• | Increase in federal funds sold and short term investments associated with daily treasury management; | ||
• | Decrease in securities available for sale and financial instruments reflecting the sale of Stifel common stock, the sale of Stifel warrants, the liquidation of managed fund equity investments held by the Parent Company and principal repayments on agency securities; | ||
• | Decrease in investment securities at cost primarily resulting from the sale of Stifel common stock and certain private equity securities; | ||
• | Increase in tax certificate balances primarily due to higher Florida tax certificate acquisitions; | ||
• | Decline in FHLB stock related to lower FHLB advance borrowings; | ||
• | Decrease in loan receivable balances associated with a $43.2 million increase in the allowance for loan losses as well as lower residential loan balances partially offset by higher small business, commercial business and home equity loan balances; | ||
• | Lower real estate held for development and sale balances associated with impairments and the sale of inventory of homes at a real estate development; |
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• | Decrease in office properties and equipment primarily due to the sale of five central Florida stores to an unrelated financial institution as well as the disposal of properties in connection with the on-going consolidation of back-office facilities; | ||
• | Decrease in deferred tax asset, net due to the establishment of a deferred tax asset valuation allowance; | ||
• | Decrease in goodwill associated with the recognition of a $48.3 million goodwill impairment; and | ||
• | Decline in other assets reflecting the receipt of income tax refunds associated with the carry-back of taxable losses for the year ended December 31, 2007. |
• | Lower non-interest-bearing deposit balances primarily reflecting the migration of non-interest bearing deposits to interest-bearing NOW accounts as BankAtlantic promoted higher interest rate NOW accounts during 2008 in response to greater competition; | ||
• | Decline in insured savings and money market accounts primarily reflecting deposit outflows resulting from interest rate reductions on high yield account products as high rates from prior period promotions were discontinued; | ||
• | Increase in certificate accounts reflecting higher brokered deposit balances as well as a higher interest rate certificate account promotion during 2008; | ||
• | Lower FHLB advance borrowings due to a decline in total assets and the availability of alternative funding sources at lower interest rates; | ||
• | Higher short-term borrowings associated with funds obtained from the Treasury at lower interest rates than alternate funding sources; and | ||
• | Decrease in other liabilities primarily resulting from a decline in accrued interest payable on borrowings associated with significantly lower interest rates at period end. |
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As of December 31, 2008 | ||||||||||||||||
Gross | Gross | |||||||||||||||
Carrying | Unrealized | Unrealized | Estimated | |||||||||||||
(in thousands) | Value | Appreciation | Depreciation | Fair Value | ||||||||||||
Cash and cash equivalents | $ | 37,116 | — | — | 37,116 | |||||||||||
Equity securities | 1,597 | — | — | 1,597 | ||||||||||||
Private investment securities | 2,036 | 467 | — | 2,503 | ||||||||||||
Total | $ | 40,749 | 467 | — | 41,216 | |||||||||||
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As of | ||||||||||||||||||||||||||||
December 31, | For the Period Ending December 31, (1) | |||||||||||||||||||||||||||
2008 | 2009 | 2010-2011 | 2012-2016 | 2017-2021 | 2022-2026 | >2027 | ||||||||||||||||||||||
Commercial real estate | $ | 1,449,620 | 665,220 | 309,179 | 316,651 | 94,982 | 60,879 | 2,709 | ||||||||||||||||||||
Residential real estate | 1,933,077 | 40,286 | 5,861 | 30,506 | 265,104 | 81,892 | 1,509,428 | |||||||||||||||||||||
Consumer and home equity | 745,086 | 1,384 | 5,861 | 297,845 | 370,009 | 69,987 | — | |||||||||||||||||||||
Commercial business | 251,248 | 120,903 | 43,983 | 81,387 | 4,428 | 547 | — | |||||||||||||||||||||
Total loans | $ | 4,379,031 | 827,793 | 364,884 | 726,389 | 734,523 | 213,305 | 1,512,137 | ||||||||||||||||||||
Total securities available for sale (1) | $ | 699,474 | — | 277 | 330 | 36,850 | 128,162 | 533,855 | ||||||||||||||||||||
(1) | Does not include $2.4 million of equity securities. |
Commercial | Real Estate | |||||||||||
Business | Construction | Total | ||||||||||
One year or less | $ | 215,440 | 291,441 | 506,881 | ||||||||
Over one year, but less than five years | 31,909 | 9,084 | 40,993 | |||||||||
Over five years | 3,899 | — | 3,899 | |||||||||
$ | 251,248 | 300,525 | 551,773 | |||||||||
Due After One Year: | ||||||||||||
Pre-determined interest rate | $ | 35,808 | 9,084 | 44,892 | ||||||||
Floating or adjustable interest rate | — | — | — | |||||||||
$ | 35,808 | 9,084 | 44,892 | |||||||||
Florida | 60 | % | ||
Eastern U.S.A. | 21 | % | ||
Western U.S.A. | 15 | % | ||
Central U.S.A | 4 | % | ||
100 | % | |||
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Minimum Ratios | ||||||||||||||||
Adequately | Well | |||||||||||||||
Actual | Capitalized | Capitalized | ||||||||||||||
Amount | Ratio | Ratio | Ratio | |||||||||||||
At December 31, 2008: | ||||||||||||||||
Total risk-based capital | $ | 456,776 | 11.63 | % | 8.00 | % | 10.00 | % | ||||||||
Tier 1 risk-based capital | 385,006 | 9.80 | 4.00 | 6.00 | ||||||||||||
Tangible capital | 385,006 | 6.80 | 1.50 | 1.50 | ||||||||||||
Core capital | 385,006 | 6.80 | 4.00 | 5.00 | ||||||||||||
At December 31, 2007: | ||||||||||||||||
Total risk-based capital | $ | 495,668 | 11.63 | % | 8.00 | % | 10.00 | % | ||||||||
Tier 1 risk-based capital | 420,063 | 9.85 | 4.00 | 6.00 | ||||||||||||
Tangible capital | 420,063 | 6.94 | 1.50 | 1.50 | ||||||||||||
Core capital | 420,063 | 6.94 | 4.00 | 5.00 |
For the Years Ended December 31, | ||||||||||||
2008 | 2007 | 2006 | ||||||||||
Net cash provided by (used in): | ||||||||||||
Operating activities | $ | 75,447 | 40,928 | 3,359 | ||||||||
Investing activities | 281,186 | (22,066 | ) | (205,891 | ) | |||||||
Financing activities | (322,250 | ) | (30,183 | ) | 174,460 | |||||||
Increase (decrease) in cash and cash equivalents | $ | 34,383 | (11,321 | ) | (28,072 | ) | ||||||
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Amount of Commitment Expiration Per Period | ||||||||||||||||||||
Total | ||||||||||||||||||||
Amounts | Less than | After 5 | ||||||||||||||||||
Commercial Commitments | Committed | 1 year | 1-3 years | 4-5 years | years | |||||||||||||||
Lines of credit | $ | 501,431 | 70,642 | — | — | 430,789 | ||||||||||||||
Standby letters of credit | 20,558 | 20,558 | — | — | — | |||||||||||||||
Other commercial commitments | 41,368 | 41,368 | — | — | — | |||||||||||||||
Total commercial commitments | $ | 563,357 | 132,568 | — | — | 430,789 | ||||||||||||||
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Payments Due by Period (2) | ||||||||||||||||||||
Less than | After 5 | |||||||||||||||||||
Contractual Obligations | Total | 1 year | 1-3 years | 4-5 years | years | |||||||||||||||
Time deposits | $ | 1,338,176 | 1,229,144 | 65,640 | 43,377 | 15 | ||||||||||||||
Long-term debt | 317,059 | — | 22,000 | 864 | 294,195 | |||||||||||||||
Advances from FHLB (1) | 967,028 | 565,000 | 402,028 | — | — | |||||||||||||||
Operating lease obligations held for sublease | 30,729 | 1,241 | 3,657 | 2,403 | 23,428 | |||||||||||||||
Operating lease obligations held for use | 74,369 | 7,983 | 11,635 | 9,562 | 45,189 | |||||||||||||||
Pension obligation | 17,340 | 1,269 | 2,995 | 3,229 | 9,847 | |||||||||||||||
Other obligations | 20,056 | 2,956 | 5,900 | 6,400 | 4,800 | |||||||||||||||
Total contractual cash obligations | $ | 2,764,757 | 1,807,593 | 513,855 | 65,835 | 377,474 | ||||||||||||||
(1) | Payments due by period are based on contractual maturities | |
(2) | The above table excludes interest payments on interest bearing liabilities |
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• | recent data observed in the market, including similar assets, | ||
• | cash flow modeling based on projected cash flows and market discount rates , and | ||
• | estimated fair value of the underlying loan collateral |
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• | Level 1. Observable inputs such as quoted prices in active markets for identical assets or liabilities; | ||
• | Level 2. Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and | ||
• | Level 3. Unobservable inputs, when there is little or no market data, which require the reporting entity to develop its own assumptions. |
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2008 | 2007 | |||||||||||||||||||
Year Ended December 31, | vs. 2007 | vs. 2006 | ||||||||||||||||||
2008 | 2007 | 2006 | Change | Change | ||||||||||||||||
(In thousands, except per share data) | ||||||||||||||||||||
Revenues | ||||||||||||||||||||
Sales of real estate | $ | 13,837 | 410,115 | 566,086 | (396,278 | ) | (155,971 | ) | ||||||||||||
Other revenues | 11,701 | 10,458 | 9,241 | 1,243 | 1,217 | |||||||||||||||
Total revenues | 25,538 | 420,573 | 575,327 | (395,035 | ) | (154,754 | ) | |||||||||||||
Costs and expenses | ||||||||||||||||||||
Cost of sales of real estate | 12,728 | 573,241 | 482,961 | (560,513 | ) | 90,280 | ||||||||||||||
Selling, general and administrative expenses | 50,754 | 117,924 | 121,151 | (67,170 | ) | (3,227 | ) | |||||||||||||
Interest expense | 10,867 | 3,807 | — | 7,060 | 3,807 | |||||||||||||||
Other expenses | — | 3,929 | 3,677 | (3,929 | ) | 252 | ||||||||||||||
Total costs and expenses | 74,349 | 698,901 | 607,789 | (624,552 | ) | 91,112 | ||||||||||||||
Earnings from Bluegreen Corporation | 8,996 | 10,275 | 9,684 | (1,279 | ) | 591 | ||||||||||||||
Impairment of investment in Bluegreen Corporation | (94,426 | ) | — | — | (94,426 | ) | — | |||||||||||||
Impairment of other investments | (14,120 | ) | — | — | (14,120 | ) | — | |||||||||||||
Interest and other income | 8,030 | 11,264 | 7,844 | (3,234 | ) | 3,420 | ||||||||||||||
Loss before income taxes | (140,331 | ) | (256,789 | ) | (14,934 | ) | 116,458 | (241,855 | ) | |||||||||||
Benefit for income taxes | — | 22,169 | 5,770 | (22,169 | ) | 16,399 | ||||||||||||||
Net loss | $ | (140,331 | ) | (234,620 | ) | (9,164 | ) | 94,289 | (225,456 | ) | ||||||||||
Basic loss per share (c) | $ | (7.35 | ) | (30.00 | ) | (2.27 | ) | 22.65 | (27.73 | ) | ||||||||||
Total diluted loss per share (a) (c) | $ | (7.35 | ) | (30.00 | ) | (2.29 | ) | 22.65 | (27.71 | ) | ||||||||||
Basic weighted average shares outstanding (b) (c) | 19,088 | 7,821 | 4,045 | 11,267 | 3,776 | |||||||||||||||
Diluted weighted average shares outstanding (b) (c) | 19,088 | 7,821 | 4,045 | 11,267 | 3,776 |
(a) | Diluted loss per share takes into account (i) the dilution in earnings we recognize from Bluegreen as a result of outstanding securities issued by Bluegreen that enable the holders thereof to acquire shares of Bluegreen’s common stock and (ii) the dilutive effect of our stock options and restricted stock using the treasury stock method. | |
(b) | The weighted average number of common shares outstanding in basic and diluted loss per common share for 2006 were retroactively adjusted for a number of shares representing the bonus element arising from the rights offering that closed on October 1, 2007. Under the rights offering, shares of our Class A common stock were issued on October 1, 2007 at a purchase price below the market price of such shares on that date resulting in the bonus element of 1.97%. The number of weighted average shares of Class A common stock was retroactively increased by this percentage for 2006. | |
(c) | On September 26, 2008, we effected a one-for-five reverse stock split. As a result of the reverse stock split, each five shares of our Class A Common Stock outstanding at the time of the reverse stock split automatically converted into one share of Class A Common Stock and each five shares of our Class B Common Stock outstanding at the time of the reverse stock split automatically converted into one share of Class B Common Stock. Accordingly, all share and per share data presented in this report for prior periods have been retroactively adjusted to reflect the reverse stock split. |
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2008 | 2007 | |||||||||||||||||||
Year Ended December 31, | vs. 2007 | vs. 2006 | ||||||||||||||||||
2008 | 2007 | 2006 | Change | Change | ||||||||||||||||
(Dollars in thousands) | ||||||||||||||||||||
Revenues | ||||||||||||||||||||
Sales of real estate | $ | 11,268 | 16,567 | 69,778 | (5,299 | ) | (53,211 | ) | ||||||||||||
Other revenues | 10,592 | 7,585 | 3,816 | 3,007 | 3,769 | |||||||||||||||
Total revenues | 21,860 | 24,152 | 73,594 | (2,292 | ) | (49,442 | ) | |||||||||||||
Costs and expenses | ||||||||||||||||||||
Cost of sales of real estate | 6,632 | 7,447 | 42,662 | (815 | ) | (35,215 | ) | |||||||||||||
Selling, general and administrative expenses | 24,608 | 19,077 | 15,119 | 5,531 | 3,958 | |||||||||||||||
Interest expense | 3,637 | 2,629 | — | 1,008 | 2,629 | |||||||||||||||
Total costs and expenses | 34,877 | 29,153 | 57,781 | 5,724 | (28,628 | ) | ||||||||||||||
Interest and other income | 5,685 | 4,489 | 2,650 | 1,196 | 1,839 | |||||||||||||||
(Loss) income before income taxes | (7,332 | ) | (512 | ) | 18,463 | (6,820 | ) | (18,975 | ) | |||||||||||
Provision for income taxes | — | (5,910 | ) | (6,936 | ) | 5,910 | 1,026 | |||||||||||||
Net (loss) income | $ | (7,332 | ) | (6,422 | ) | 11,527 | (910 | ) | (17,949 | ) | ||||||||||
Operational data: | ||||||||||||||||||||
Acres sold (a) | 40 | 40 | 371 | — | (331 | ) | ||||||||||||||
Margin percentage (b) | 41.1 | % | 55.0 | % | 38.9 | % | (13.9 | )% | 16.1 | % | ||||||||||
Unsold saleable acres | 6,639 | 6,679 | 6,871 | (40 | ) | (192 | ) | |||||||||||||
Acres subject to sales contracts – Third parties | 10 | 259 | 74 | (249 | ) | 185 | ||||||||||||||
Aggregate sales price of acres subject to sales contracts to third parties | $ | 1,050 | 77,888 | 21,124 | (76,838 | ) | 56,764 |
(a) | Includes 5 acres sold related to commercial projects. | |
(b) | Margin percentage is calculated by dividing margin (sales of real estate minus cost of sales of real estate) by sales of real estate. Sales of real estate and margin percentage include lot sales, revenues from look back provisions and recognition of deferred revenue associated with sales in prior periods. |
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2008 | 2007 | |||||||||||||||||||
Year Ended December 31, | Vs. 2007 | Vs. 2006 | ||||||||||||||||||
2008 | 2007 | 2006 | Change | Change | ||||||||||||||||
(Dollars in thousands) | ||||||||||||||||||||
Revenues | ||||||||||||||||||||
Sales of real estate | $ | 2,484 | 6,574 | 11,041 | (4,090 | ) | (4,467 | ) | ||||||||||||
Other revenues | 1,109 | 952 | 1,435 | 157 | (483 | ) | ||||||||||||||
Total revenues | 3,593 | 7,526 | 12,476 | (3,933 | ) | (4,950 | ) | |||||||||||||
Costs and expenses | ||||||||||||||||||||
Cost of sales of real estate | 16,151 | 16,793 | 11,649 | (642 | ) | 5,144 | ||||||||||||||
Selling, general and administrative expenses | 26,717 | 32,508 | 28,174 | (5,791 | ) | 4,334 | ||||||||||||||
Interest expense | 8,315 | 1,073 | — | 7,242 | 1,073 | |||||||||||||||
Other expenses | — | 2,390 | 8 | (2,390 | ) | 2,382 | ||||||||||||||
Total costs and expenses | 51,183 | 52,764 | 39,831 | (1,581 | ) | 12,933 | ||||||||||||||
Earnings from Bluegreen Corporation | 8,996 | 10,275 | 9,684 | (1,279 | ) | 591 | ||||||||||||||
Impairment of investment in Bluegreen Corporation | (94,426 | ) | — | — | (94,426 | ) | — | |||||||||||||
Impairment of other investments | (14,120 | ) | — | — | (14,120 | ) | — | |||||||||||||
Interest and other income | 4,001 | 7,367 | 4,059 | (3,366 | ) | 3,308 | ||||||||||||||
Loss before income taxes | (143,139 | ) | (27,596 | ) | (13,612 | ) | (115,543 | ) | (13,984 | ) | ||||||||||
Benefit for income taxes | — | 34,297 | 5,639 | (34,297 | ) | 28,658 | ||||||||||||||
Net (loss) income | $ | (143,139 | ) | 6,701 | (7,973 | ) | (149,840 | ) | 14,674 | |||||||||||
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2008 | 2007 | |||||||||||||||||||
Year Ended December 31, | vs. 2007 | vs. 2006 | ||||||||||||||||||
2008 | 2007 | 2006 | Change | Change | ||||||||||||||||
(Dollars in thousands, except average price data) | ||||||||||||||||||||
Revenues | ||||||||||||||||||||
Sales of real estate | $ | — | 345,666 | 424,420 | (345,666 | ) | (78,754 | ) | ||||||||||||
Other revenues | — | 2,243 | 4,070 | (2,243 | ) | (1,827 | ) | |||||||||||||
Total revenues | — | 347,909 | 428,490 | (347,909 | ) | (80,581 | ) | |||||||||||||
Costs and expenses | ||||||||||||||||||||
Cost of sales of real estate | — | 501,206 | 367,252 | (501,206 | ) | 133,954 | ||||||||||||||
Selling, general and administrative expenses | — | 61,568 | 65,052 | (61,568 | ) | (3,484 | ) | |||||||||||||
Interest expense | — | 7,258 | — | (7,258 | ) | 7,258 | ||||||||||||||
Other expenses | — | 1,539 | 2,362 | (1,539 | ) | (823 | ) | |||||||||||||
Total costs and expenses | — | 571,571 | 434,666 | (571,571 | ) | 136,905 | ||||||||||||||
Interest and other income | — | 6,933 | 2,982 | (6,933 | ) | 3,951 | ||||||||||||||
(Loss) income before income taxes | — | (216,729 | ) | (3,194 | ) | 216,729 | (213,535 | ) | ||||||||||||
Benefit (provision) for income taxes | — | 1,396 | 1,508 | (1,396 | ) | (112 | ) | |||||||||||||
Net (loss) income | $ | — | (215,333 | ) | (1,686 | ) | 215,333 | (213,647 | ) | |||||||||||
Operational data: | ||||||||||||||||||||
Homes delivered | — | 998 | 1,320 | (998 | ) | (322 | ) | |||||||||||||
Construction starts | — | 558 | 1,445 | (558 | ) | (887 | ) | |||||||||||||
Average selling price of homes delivered | $ | — | 338,000 | 322,000 | (338,000 | ) | 16,000 | |||||||||||||
Margin percentage (a) | — | (45.0 | )% | 13.5 | % | 45.0 | % | (58.5 | )% | |||||||||||
Gross sales contracts (units) | — | 765 | 1,108 | (765 | ) | (343 | ) | |||||||||||||
Sales contracts cancellations (units) | — | 382 | 261 | (382 | ) | 121 | ||||||||||||||
Net orders (units) | — | 383 | 847 | (383 | ) | (464 | ) | |||||||||||||
Net orders (value) | $ | — | 94,782 | 324,217 | (94,782 | ) | (229,435 | ) | ||||||||||||
Backlog of homes (units) | — | — | 1,126 | — | (1,126 | ) | ||||||||||||||
Backlog of homes (value) | $ | — | — | 411,578 | — | (411,578 | ) |
(a) | Margin percentage is calculated by dividing margin (sales of real estate minus cost of sales of real estate) by sales of real estate. |
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2008 | 2007 | |||||||||||||||||||
Year Ended December 31, | vs. 2007 | vs. 2006 | ||||||||||||||||||
2008 | 2007 | 2006 | Change | Change | ||||||||||||||||
(Dollars in thousands, except average price data) | ||||||||||||||||||||
Revenues | ||||||||||||||||||||
Sales of real estate | $ | — | 42,042 | 76,299 | (42,042 | ) | (34,257 | ) | ||||||||||||
Total revenues | — | 42,042 | 76,299 | (42,042 | ) | (34,257 | ) | |||||||||||||
Costs and expenses | ||||||||||||||||||||
Cost of sales of real estate | — | 51,360 | 72,807 | (51,360 | ) | (21,447 | ) | |||||||||||||
Selling, general and administrative expenses | — | 5,010 | 12,806 | (5,010 | ) | (7,796 | ) | |||||||||||||
Interest expense | — | 151 | — | (151 | ) | 151 | ||||||||||||||
Other expenses | — | — | 1,307 | — | (1,307 | ) | ||||||||||||||
�� | ||||||||||||||||||||
Total costs and expenses | — | 56,521 | 86,920 | (56,521 | ) | (30,399 | ) | |||||||||||||
Interest and other income | — | 83 | 127 | (83 | ) | (44 | ) | |||||||||||||
(Loss) income before income taxes | — | (14,396 | ) | (10,494 | ) | 14,396 | (3,902 | ) | ||||||||||||
(Provision) benefit for income taxes | — | (1,700 | ) | 3,241 | 1,700 | (4,941 | ) | |||||||||||||
Net (loss) income | $ | — | (16,096 | ) | (7,253 | ) | 16,096 | (8,843 | ) | |||||||||||
Operational data: | ||||||||||||||||||||
Homes delivered | — | 146 | 340 | (146 | ) | (194 | ) | |||||||||||||
Construction starts | — | 171 | 237 | (171 | ) | (66 | ) | |||||||||||||
Average selling price of homes delivered | $ | — | 205,000 | 224,000 | (205,000 | ) | (19,000 | ) | ||||||||||||
Margin percentage (a) | — | (22.2 | )% | 4.6 | % | 22.2 | % | (26.8 | )% | |||||||||||
Gross sales contracts (units) | — | 266 | 412 | (266 | ) | (146 | ) | |||||||||||||
Sales contracts cancellations (units) | — | 156 | 143 | (156 | ) | 13 | ||||||||||||||
Net orders (units) | — | 110 | 269 | (110 | ) | (159 | ) | |||||||||||||
Net orders (value) | $ | — | 20,621 | 57,776 | (20,621 | ) | (37,155 | ) | ||||||||||||
Backlog of homes (units) | — | — | 122 | — | (122 | ) | ||||||||||||||
Backlog of homes (value) | $ | — | — | 26,662 | — | (26,662 | ) |
(a) | Margin percentage is calculated by dividing margin (sales of real estate minus cost of sales of real estate) by sales of real estate. |
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• | a net decrease in cash and cash equivalents of $80.4 million, which resulted from cash used in operations of $32.9 million, cash used in investing activities of $41.9 million and cash used in financing activities of $5.6 million; | ||
• | an increase in restricted cash of $19.1 million primarily related to the funding of the Levitt and Sons Settlement Agreement, providing collateral for a letter of credit as a result of a surety bond claim and the establishment of an interest reserve for one of Core’s loan agreements; | ||
• | a decrease in current income tax receivable as a result of the receipt of a $29.7 million federal income tax refund; | ||
• | a decrease in our investment in Bluegreen of $86.2 million as a result of impairment charges recorded during 2008; | ||
• | a net increase of our investment in other equity securities of $4.3 million as a result of the acquisition (net of shares sold) of shares of Office Depot and a $3.0 million investment in Pizza Fusion; | ||
• | an increase in our investment in certificates of deposit of $9.6 million as a result of our investment in FDIC insured certificates of deposit in 2008; | ||
• | a net increase in inventory of real estate of $14.0 million primarily associated with the land development activities of the Land Division; and | ||
• | a decrease in property and equipment of $8.8 million due to the sale of three ground lease parcels and a depreciation adjustment related to the reclassification into continuing operations of two of Core’s commercial leasing assets previously classified as discontinued operations. |
• | a net decrease in notes and mortgage notes payable of $3.8 million primarily due to curtailment payments made in connection with a development loan collateralized by land in Tradition Hilton Head, offset in part by draws on lines of credit in the Land Division; and | ||
• | an increase in our current tax liability of approximately $2.4 million relating to our FIN 48 liability which was netted against our current tax asset in 2007; and | ||
• | a net decrease in accounts payable and other accrued liabilities of approximately $8.1 million primarily attributable to decreased severance and construction accruals due to payments made during the year ended December 31, 2008. |
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Payments due by period | ||||||||||||||||||||
Less than | 13 - 36 | 37 - 60 | More than | |||||||||||||||||
Category (1) | Total | 12 Months | Months | Months | 60 Months | |||||||||||||||
Long-term debt obligations (2) | $ | 349,952 | 3,567 | 197,233 | 27,574 | 121,578 | ||||||||||||||
Interest payable on long-term debt | 244,269 | 18,140 | 31,476 | 18,855 | 175,798 | |||||||||||||||
Operating lease obligations | 3,797 | 1,279 | 1,062 | 386 | 1,070 | |||||||||||||||
Severance related termination obligations | 129 | 129 | — | — | — | |||||||||||||||
Independent contractor agreements | 681 | 681 | — | — | — | |||||||||||||||
Total obligations | $ | 598,828 | 23,796 | 229,771 | 46,815 | 298,446 | ||||||||||||||
(1) | Long-term debt obligations consist of notes, mortgage notes and bonds payable. Interest payable on these long-term debt obligations is the interest that will be incurred related to the outstanding debt. Operating lease obligations consist of lease commitments. The timing of contractual payments for debt obligations assumes the exercise of all extensions available at our sole discretion. | |
(2) | In addition to the above scheduled payments, Core’s borrowing agreements generally require repayment of specified amounts upon a sale of a portion of the property collateralizing the debt or upon a reappraisal of the underlying collateral if declines in value cause the loan to exceed maximum loan to value ratios. In addition, Core is subject to provisions in its borrowing agreements that require additional principal payments, known as curtailment payments, in the event that sales are below those agreed to at the inception of the borrowing. Total curtailment payments during 2008 amounted to $19.9 million, consisting of a $14.9 million curtailment payment which was paid in January 2008 and an additional $5 million curtailment payment which was paid in June 2008. Additionally, certain borrowings may require increased principal payments on our debt obligations due to re-margining requirements. |
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BankAtlantic Repricing Gap Table | ||||||||||||||||||||
As of December 31, 2008 | ||||||||||||||||||||
1 Year | 3 Years | 5 Years | More Than | |||||||||||||||||
or Less | or Less | or Less | 5 Years | Total | ||||||||||||||||
Interest earning assets: | ||||||||||||||||||||
Loans: | ||||||||||||||||||||
Residential loans (1) | ||||||||||||||||||||
Fixed rate | $ | 221,281 | 127,914 | 65,996 | 236,071 | 651,262 | ||||||||||||||
Hybrids ARM less than 5 years | 64,444 | 40,703 | 6,118 | — | 111,265 | |||||||||||||||
Hybrids ARM more than 5 years | 441,458 | 274,155 | 201,044 | 261,715 | 1,178,372 | |||||||||||||||
Commercial loans | 989,437 | 138,406 | 110,131 | 130,512 | 1,368,486 | |||||||||||||||
Small business loans | 207,950 | 83,499 | 26,676 | 8,155 | 326,280 | |||||||||||||||
Consumer | 712,714 | 7,578 | 4,626 | 21,730 | 746,648 | |||||||||||||||
Total loans | 2,637,284 | 672,255 | 414,591 | 658,183 | 4,382,313 | |||||||||||||||
Investment securities | ||||||||||||||||||||
Mortgage backed securities | 210,711 | 133,679 | 79,576 | 263,626 | 687,592 | |||||||||||||||
Taxable investment securities | 75,412 | 250 | — | 12,761 | 88,423 | |||||||||||||||
Tax certificates | 213,534 | — | — | — | 213,534 | |||||||||||||||
Total investment securities | 499,657 | 133,929 | 79,576 | 276,387 | 989,549 | |||||||||||||||
Total interest earning assets | 3,136,941 | 806,184 | 494,167 | 934,570 | 5,371,862 | |||||||||||||||
Total non-earning assets | — | — | — | 341,828 | 341,828 | |||||||||||||||
Total assets | $ | 3,136,941 | 806,184 | 494,167 | 1,276,398 | 5,713,690 | ||||||||||||||
Total interest bearing liabilities | $ | 2,949,420 | 658,713 | 243,834 | 1,368,893 | 5,220,860 | ||||||||||||||
Non-interest bearing liabilities | — | — | — | 492,830 | 492,830 | |||||||||||||||
Total non-interest bearing liabilities and equity | $ | 2,949,420 | 658,713 | 243,834 | 1,861,723 | 5,713,690 | ||||||||||||||
GAP (repricing difference) | $ | 187,521 | 147,471 | 250,333 | (434,323 | ) | ||||||||||||||
Cumulative GAP | $ | 187,521 | 334,992 | 585,325 | 151,002 | |||||||||||||||
Repricing Percentage | 3.28 | % | 2.58 | % | 4.38 | % | -7.60 | % | ||||||||||||
Cumulative Percentage | 3.28 | % | 5.86 | % | 10.24 | % | 2.64 | % | ||||||||||||
1) | Hybrid adjustable rate mortgages (ARM) earn fixed rates for designated periods and adjust annually thereafter based on the one year U.S. Treasury note rate. |
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Year Ending December 31, | Amount (1) | |||
2009 | $ | 44,835 | ||
2010 | 41,413 | |||
2011 | 85,408 | |||
2012 | 81,191 | |||
2013 | 163,330 | |||
Thereafter | 563,436 | |||
Total interest only loans | $ | 979,613 | ||
(1) | The above table assumes no prepayments. |
i. | Calculating interest income and interest expense from existing assets and liabilities using current repricing, prepayment and volume assumptions, | |
ii. | Estimating the change in expected net interest income based on instantaneous and parallel shifts in the yield curve to determine the effect on net interest income; and | |
iii. | Calculating the percentage change in net interest income calculated in (i) and (ii). |
• | Interest rates, | |
• | Loan prepayment rates, | |
• | Deposit decay rates, | |
• | Re-pricing of certain borrowings, and | |
• | Reinvestment in earning assets. |
• | Fixed rate mortgages | 20 % | ||
• | Fixed rate securities | 20 % | ||
• | Tax certificates | 10 % | ||
• | Adjustable rate mortgages | 27 % | ||
• | Adjustable rate securities | 36 % |
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Within | 1-3 | 3-5 | Over 5 | |||||||||||||
1 Year | Years | Years | Years | |||||||||||||
Money fund savings accounts decay rates | 17 | % | 17 | % | 16 | % | 14 | % | ||||||||
NOW and savings accounts decay rates | 37 | % | 32 | % | 17 | % | 17 | % |
As of December 31, 2008 | ||||||||
Net | ||||||||
Changes | Interest | Percent | ||||||
in Rate | Income | Change | ||||||
+200 bp | $ | 191,139 | -3.99 | % | ||||
+100 bp | 198,441 | -0.32 | % | |||||
0 | 199,086 | — | ||||||
-100 bp | 196,893 | -1.10 | % | |||||
-200 bp | 193,138 | -2.99 | % |
As of December 31, 2007 | ||||||||
Net | ||||||||
Changes | Interest | Percent | ||||||
in Rate | Income | Change | ||||||
+200 bp | $ | 187,031 | -7.96 | % | ||||
+100 bp | 198,147 | -2.38 | % | |||||
0 | 202,876 | — | ||||||
-100 bp | 203,331 | 0.23 | % | |||||
-200 bp | 204,354 | 0.74 | % |
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Fair Market | ||||||||||||||||||||||||||||||||
Value at | ||||||||||||||||||||||||||||||||
Payments due by year | December 31, | |||||||||||||||||||||||||||||||
2009 | 2010 | 2011 | 2012 | 2013 | Thereafter | Total | 2008 | |||||||||||||||||||||||||
Fixed rate debt: | ||||||||||||||||||||||||||||||||
Notes and mortgage payable (a) | 723 | 561 | 573 | 504 | 499 | 99,332 | 102,192 | 28,384 | ||||||||||||||||||||||||
Average interest rate | 8.09 | % | 8.11 | % | 8.12 | % | 8.13 | % | 8.14 | % | 8.15 | % | 8.12 | % | ||||||||||||||||||
Variable rate debt: | ||||||||||||||||||||||||||||||||
Notes and mortgage payable (a) | 2,797 | 8,102 | 187,895 | 25,751 | 707 | 19,217 | 244,469 | 227,145 | ||||||||||||||||||||||||
Average interest rate | 4.04 | % | 4.04 | % | 4.07 | % | 5.39 | % | 5.86 | % | 5.86 | % | 4.22 | % | ||||||||||||||||||
Total debt obligations | 3,520 | 8,663 | 188,468 | 26,255 | 1,206 | 118,549 | 346,661 | 255,529 |
(a) | Fair value calculated using current estimated borrowing rates. |
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INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
Report of Independent Registered Certified Public Accounting Firm of PricewaterhouseCoopers LLP | ||
Financial Statements: | ||
153 | ||
154 | ||
156 | ||
157 | ||
158 | ||
161 |
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Fort Lauderdale, Florida
March 31, 2009
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December 31, | ||||||||
2008 | 2007 | |||||||
ASSETS | ||||||||
Cash and cash equivalents | $ | 247,760 | 326,524 | |||||
Federal funds sold and other short-term investments | 31,177 | 5,631 | ||||||
Restricted cash | 21,288 | 2,207 | ||||||
Securities available for sale and other financial instruments (at fair value) | 722,698 | 926,307 | ||||||
Financial instruments accounted for at fair value | — | 10,661 | ||||||
Investment securities at cost or amortized costs (fair value:$12,475 and $65,244) | 12,008 | 60,173 | ||||||
Tax certificates, net of allowance of $6,064 in 2008 and $3,289 in 2007 | 213,534 | 188,401 | ||||||
Federal Home Loan Bank stock, at cost which approximates fair value | 54,607 | 74,003 | ||||||
Residential loans held for sale at lower of cost or fair value | 3,461 | 4,087 | ||||||
Loans receivable, net of allowance for loan losses of $137,257 in 2008 and $94,020 in 2007 | 4,314,184 | 4,524,451 | ||||||
Accrued interest receivable | 41,817 | 46,271 | ||||||
Real estate held for development and sale | 268,763 | 270,229 | ||||||
Real estate owned | 19,045 | 17,216 | ||||||
Investments in unconsolidated affiliates | 41,386 | 128,321 | ||||||
Properties and equipment, net | 315,347 | 360,889 | ||||||
Goodwill | 20,782 | 70,490 | ||||||
Other intangible assets, net | 24,204 | 5,396 | ||||||
Deferred tax asset, net | — | 16,330 | ||||||
Other assets | 43,521 | 76,846 | ||||||
Total assets | $ | 6,395,582 | 7,114,433 | |||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||
Liabilities: | ||||||||
Interest bearing | $ | 3,184,677 | 3,129,194 | |||||
Non-interest bearing | 741,691 | 824,211 | ||||||
Total deposits | 3,926,368 | 3,953,405 | ||||||
Advances from FHLB | 967,491 | 1,397,044 | ||||||
Federal funds purchased and other short term borrowings | 238,339 | 108,975 | ||||||
Securities sold under agreements to repurchase | 41,387 | 50,930 | ||||||
Subordinated debentures, mortgage notes payable and mortgage-backed bonds | 287,772 | 295,421 | ||||||
Junior subordinated debentures | 376,104 | 379,223 | ||||||
Loss in excess of investment in Woodbridge’s subsidiary | 52,887 | 55,214 | ||||||
Other liabilities | 118,784 | 131,234 | ||||||
Total liabilities | 6,009,132 | 6,371,446 | ||||||
Redeemable 5% Cumulative Preferred Stock — $.01 par value; authorized 15,000 shares; issued and outstanding 15,000 shares in 2008 and 0 in 2007, with a redemption value of $1,000 per share (See Note 34) | 11,029 | — | ||||||
Noncontrolling interest | 262,554 | 558,950 | ||||||
Commitments and contingencies | ||||||||
Shareholders’ equity: | ||||||||
Preferred stock of $ .01 par value; authorized 10,000,000 shares; 5% Cumulative Convertible Preferred Stock (5% Preferred Stock) authorized 15,000 shares; issued and outstanding 0 shares in 2008 and 15,000 shares in 2007 | — | — | ||||||
Class A common stock of $.01 par value, authorized 70,000,000 shares; issued and outstanding 38,254,389 in 2008 and 38,232,932 in 2007 | 382 | 382 | ||||||
Class B common stock of $.01 par value, authorized 20,000,000 shares; issued and outstanding 6,875,104 in 2008 and 6,876,081 in 2007 | 69 | 69 | ||||||
Additional paid-in capital | 123,562 | 131,189 | ||||||
(Accumulated deficit) retained earnings | (8,848 | ) | 50,801 | |||||
Total shareholders’ equity before accumulated other comprehensive (loss) income | 115,165 | 182,441 | ||||||
Accumulated other comprehensive (loss) income | (2,298 | ) | 1,596 | |||||
Total shareholders’ equity | 112,867 | 184,037 | ||||||
Total liabilities and shareholders’ equity | $ | 6,395,582 | 7,114,433 | |||||
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For the Years Ended December 31, | ||||||||||||
2008 | 2007 | 2006 | ||||||||||
Revenues | ||||||||||||
BFC Activities: | ||||||||||||
Interest and dividend income | $ | 1,368 | 2,335 | 2,249 | ||||||||
Securities activities, net | 898 | 1,295 | — | |||||||||
Other income | 2,142 | 2,479 | 1,433 | |||||||||
4,408 | 6,109 | 3,682 | ||||||||||
Financial Services: | ||||||||||||
Interest and dividend income | 314,538 | 371,633 | 367,177 | |||||||||
Service charges on deposits | 93,905 | 102,639 | 90,472 | |||||||||
Other service charges and fees | 28,959 | 28,950 | 27,542 | |||||||||
Securities activities, net | 2,039 | 8,412 | 9,813 | |||||||||
Other income | 10,130 | 9,159 | 12,742 | |||||||||
449,571 | 520,793 | 507,746 | ||||||||||
Real Estate Development: | ||||||||||||
Sales of real estate | 13,837 | 410,115 | 566,086 | |||||||||
Interest and dividend income | 3,192 | 3,936 | 2,474 | |||||||||
Securities activities, net | 1,178 | — | — | |||||||||
Other income | 15,284 | 17,614 | 14,592 | |||||||||
33,491 | 431,665 | 583,152 | ||||||||||
Total revenues | 487,470 | 958,567 | 1,094,580 | |||||||||
Costs and Expenses | ||||||||||||
BFC Activities: | ||||||||||||
Employee compensation and benefits | 8,793 | 10,932 | 9,407 | |||||||||
Other expenses | 3,346 | 4,083 | 2,963 | |||||||||
12,139 | 15,015 | 12,370 | ||||||||||
Financial Services: | ||||||||||||
Interest expense, net of interest capitalized | 140,502 | 192,672 | 166,578 | |||||||||
Provision for (recovery of) loan losses | 159,801 | 70,842 | 8,574 | |||||||||
Employee compensation and benefits | 128,897 | 151,178 | 150,804 | |||||||||
Occupancy and equipment | 64,782 | 65,851 | 57,308 | |||||||||
Advertising and promotion | 16,335 | 20,002 | 35,067 | |||||||||
Cost associated with debt redemption | 1,238 | — | 1,457 | |||||||||
Provision for tax certificates | 7,286 | 300 | 300 | |||||||||
Restructuring charges and exit activities | 7,395 | 8,351 | — | |||||||||
Impairment of goodwill | 46,564 | — | — | |||||||||
Impairment of real estate held for sale | 1,169 | 5,240 | — | |||||||||
Impairment of real estate owned | 1,465 | 7,299 | 9 | |||||||||
Other expenses | 59,536 | 57,723 | 54,214 | |||||||||
634,970 | 579,458 | 474,311 | ||||||||||
Real Estate Development: | ||||||||||||
Cost of sales of real estate | 12,838 | 573,241 | 482,961 | |||||||||
Interest expense, net of interest capitalized | 10,667 | 3,807 | — | |||||||||
Selling, general and administrative expenses | 49,246 | 116,918 | 120,017 | |||||||||
Other expenses | — | 3,929 | 3,677 | |||||||||
72,751 | 697,895 | 606,655 | ||||||||||
Total costs and expenses | 719,860 | 1,292,368 | 1,093,336 | |||||||||
Equity in earnings from unconsolidated affiliates | 15,064 | 12,724 | 10,935 | |||||||||
Impairment of unconsolidated affiliates | (96,579 | ) | — | — | ||||||||
Impairment of investments | (15,548 | ) | — | — | ||||||||
(Loss) income from continuing operations before income taxes and noncontrolling interest | (329,453 | ) | (321,077 | ) | 12,179 | |||||||
Less: Provision (benefit) for income taxes | 15,763 | (69,012 | ) | (530 | ) | |||||||
Less: Noncontrolling interest income (loss) | (272,711 | ) | (218,165 | ) | 13,406 | |||||||
Loss from continuing operations | (72,505 | ) | (33,900 | ) | (697 | ) | ||||||
Discontinued operations, less noncontrolling interest and income tax provision (benefit) of $0 in 2008, $(3,471) in 2007 and $(8,957) in 2006 | 4,461 | 1,038 | (1,524 | ) | ||||||||
Extraordinary gain, less income tax of $0 in 2008 and $1,509 in 2007 | 9,145 | 2,403 | — | |||||||||
Net loss | (58,899 | ) | (30,459 | ) | (2,221 | ) | ||||||
Preferred stock dividends | (750 | ) | (750 | ) | (750 | ) | ||||||
Net loss allocable to common stock | $ | (59,649 | ) | (31,209 | ) | (2,971 | ) | |||||
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Consolidated Statements of Operations
(In thousands, except per share data)
For the Years Ended December 31, | ||||||||||||
2008 | 2007 | 2006 | ||||||||||
(Loss) earnings per common share: | ||||||||||||
Basic loss per share from continuing operations | $ | (1.62 | ) | (0.90 | ) | (0.04 | ) | |||||
Basic earnings (loss) per share from discontinued operations | 0.10 | 0.03 | (0.05 | ) | ||||||||
Basic earnings per share from extraordinary gain | 0.20 | 0.06 | — | |||||||||
Basic loss per share | $ | (1.32 | ) | (0.81 | ) | (0.09 | ) | |||||
Diluted loss per share from continuing operations | $ | (1.62 | ) | (0.90 | ) | (0.05 | ) | |||||
Diluted earnings (loss) per share from discontinued operations | 0.10 | 0.03 | (0.05 | ) | ||||||||
Diluted earnings per share from extraordinary gain | 0.20 | 0.06 | — | |||||||||
Diluted loss per share | $ | (1.32 | ) | (0.81 | ) | (0.10 | ) | |||||
Basic weighted average number of common shares outstanding | 45,097 | 38,778 | 33,249 | |||||||||
Diluted weighted average number of common and common equivalent shares outstanding | 45,097 | 38,778 | 33,249 |
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For the Years Ended December 31, | ||||||||||||
2008 | 2007 | 2006 | ||||||||||
Net loss | $ | (58,899 | ) | (30,459 | ) | (2,221 | ) | |||||
Other comprehensive income (loss), net of tax: | ||||||||||||
Unrealized gains (loss) on securities available for sale | (2,004 | ) | 2,543 | 2,471 | ||||||||
(Benefit) provision for income taxes | (1,229 | ) | 981 | 953 | ||||||||
Unrealized gains (loss) on securities available for sale, net of tax | (775 | ) | 1,562 | 1,518 | ||||||||
Unfunded pension liability | (4,799 | ) | 102 | 345 | ||||||||
Provision for income taxes | — | 39 | 133 | |||||||||
Unfunded pension liability, net of tax | (4,799 | ) | 63 | 212 | ||||||||
Unrealized (losses) gains associated with investment in unconsolidated affiliates | (476 | ) | (12 | ) | 129 | |||||||
(Benefit) provision for income taxes | (184 | ) | (5 | ) | 50 | |||||||
Unrealized (losses) gains associated with investment in unconsolidated affiliates, net of tax | (292 | ) | (7 | ) | 79 | |||||||
Reclassification adjustments: | ||||||||||||
Realized net periodic pension income (costs) | 74 | 35 | (42 | ) | ||||||||
Provision (benefit) for income taxes | — | 14 | (16 | ) | ||||||||
Realized net periodic pension income (costs), net of tax | 74 | 21 | (26 | ) | ||||||||
Net realized (gains) loss reclassified into net loss | 1,898 | (2,423 | ) | (1,395 | ) | |||||||
(Benefit) for income taxes | — | (929 | ) | (538 | ) | |||||||
Net realized gains reclassified into net loss, net of tax | 1,898 | (1,494 | ) | (857 | ) | |||||||
Other comprehensive (loss) income, net of tax | (3,894 | ) | 145 | 926 | ||||||||
Comprehensive loss | $ | (62,793 | ) | (30,314 | ) | (1,295 | ) | |||||
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Unearned | Accumulated | |||||||||||||||||||||||||||||||||||
Compen- | Other | |||||||||||||||||||||||||||||||||||
sation | (Accumulated) | Compre- | ||||||||||||||||||||||||||||||||||
Shares of Common | Class A | Class B | Additional | Restricted | Deficit | hensive | ||||||||||||||||||||||||||||||
Stock Outstanding | Common | Common | Paid-in | Stock | Retained | (Loss) | ||||||||||||||||||||||||||||||
Class A | Class B | Stock | Stock | Capital | Grants | Earnings | Income | Total | ||||||||||||||||||||||||||||
Balance, December 31, 2005 | 29,950 | 4,285 | $ | 278 | 41 | 97,223 | (100 | ) | 85,113 | 525 | 183,080 | |||||||||||||||||||||||||
Cumulative effect adjustment upon adoption of Staff Accounting Bulletin No. 108 (“SAB No. 108”) | — | — | — | — | — | — | (253 | ) | — | (253 | ) | |||||||||||||||||||||||||
Net loss | — | — | — | — | — | — | (2,221 | ) | — | (2,221 | ) | |||||||||||||||||||||||||
Other comprehensive income, net of taxes | — | — | — | — | — | — | — | 926 | 926 | |||||||||||||||||||||||||||
Issuance of Common Stock, upon exercise of stock options | 30 | 3,929 | 1 | 39 | 9,076 | — | — | — | 9,116 | |||||||||||||||||||||||||||
Retirement of Common Stock relating to exercise of stock options | (1,279 | ) | (1,068 | ) | (13 | ) | (11 | ) | (13,246 | ) | — | — | — | (13,270 | ) | |||||||||||||||||||||
Net effect of subsidiaries’ capital transactions, net of taxes | — | — | — | — | (16 | ) | — | — | — | (16 | ) | |||||||||||||||||||||||||
Cash dividends on preferred stock | — | — | — | — | — | — | (750 | ) | — | (750 | ) | |||||||||||||||||||||||||
Share-based compensation related to stock options and restricted stock | — | — | — | — | 973 | — | — | — | 973 | |||||||||||||||||||||||||||
Reversal of unamortized stock compensation related to restricted stock upon adoption of FAS 123 ( R) | — | — | — | — | (100 | ) | 100 | — | — | — | ||||||||||||||||||||||||||
Transfer of shares of Common Stock | 55 | (55 | ) | — | — | — | — | — | — | — | ||||||||||||||||||||||||||
Balance, December 31, 2006 | 28,756 | 7,091 | $ | 266 | 69 | 93,910 | — | 81,889 | 1,451 | 177,585 | ||||||||||||||||||||||||||
Cumulative effect adjustment upon adoption of FASB Interpretation No. 48 | — | — | — | — | — | — | 121 | — | 121 | |||||||||||||||||||||||||||
Net loss | — | — | — | — | — | — | (30,459 | ) | — | (30,459 | ) | |||||||||||||||||||||||||
Other comprehensive income, net of taxes | — | — | — | — | — | — | — | 145 | 145 | |||||||||||||||||||||||||||
Issuance of common stock, net of issuance costs | 11,500 | — | 115 | — | 36,006 | — | — | — | 36,121 | |||||||||||||||||||||||||||
Issuance of common stock upon exercise of stock options and restricted stock | 152 | — | 1 | — | 187 | — | — | — | 188 | |||||||||||||||||||||||||||
Cancelled shares of common stock upon merger. (See notes 32 and 33) | (2,163 | ) | (227 | ) | — | — | — | — | — | — | — | |||||||||||||||||||||||||
Net effect of subsidiaries’ capital transactions, net of taxes | — | — | — | — | (101 | ) | — | — | — | (101 | ) | |||||||||||||||||||||||||
Cash dividends on preferred stock | — | — | — | — | — | — | (750 | ) | — | (750 | ) | |||||||||||||||||||||||||
Share-based compensation related to stock options and restricted stock | — | — | — | — | 1,187 | — | — | — | 1,187 | |||||||||||||||||||||||||||
Transfer of shares of Common Stock | (12 | ) | 12 | — | — | — | — | — | — | — | ||||||||||||||||||||||||||
Balance, December 31, 2007 | 38,233 | 6,876 | $ | 382 | 69 | 131,189 | — | 50,801 | 1,596 | 184,037 | ||||||||||||||||||||||||||
Net loss | — | — | — | — | — | — | (58,899 | ) | — | (58,899 | ) | |||||||||||||||||||||||||
Other comprehensive loss, net of taxes | — | — | — | — | — | — | — | (3,894 | ) | (3,894 | ) | |||||||||||||||||||||||||
Issuance of restricted Class A Common Stock | 120 | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||
Transfer of shares of Common Stock | 1 | (1 | ) | — | — | — | — | — | — | |||||||||||||||||||||||||||
Purchase and retirement of of Class A Common Stock | (100 | ) | — | — | — | (54 | ) | — | — | — | (54 | ) | ||||||||||||||||||||||||
Net effect of subsidiaries’ capital transactions, net of taxes | — | — | — | — | 2,398 | — | — | — | 2,398 | |||||||||||||||||||||||||||
Cash dividends on preferred stock | — | — | — | — | — | — | (750 | ) | — | (750 | ) | |||||||||||||||||||||||||
Re-classification of the 5% Preferred Stock to Redeemable Preferred stock (see Note 34) | — | — | — | — | (11,029 | ) | — | — | — | (11,029 | ) | |||||||||||||||||||||||||
Share-based compensation related to stock options and restricted stock | — | — | — | — | 1,058 | — | — | — | 1,058 | |||||||||||||||||||||||||||
Balance, December 31, 2008 | 38,254 | 6,875 | $ | 382 | 69 | 123,562 | — | (8,848 | ) | (2,298 | ) | 112,867 | ||||||||||||||||||||||||
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For the Years Ended December 31, | ||||||||||||
2008 | 2007 | 2006 | ||||||||||
Operating activities: | ||||||||||||
Net loss | $ | (58,899 | ) | (30,459 | ) | (2,221 | ) | |||||
Adjustment to reconcile net loss to net cash used in operating activities: | ||||||||||||
Extraordinary gain, net of taxes | (9,145 | ) | (2,403 | ) | — | |||||||
Noncontrolling interest | (272,711 | ) | (218,165 | ) | 13,406 | |||||||
Provision for loan losses | 168,552 | 78,441 | 8,883 | |||||||||
Restructuring charges, impairments and exit activities | 8,564 | 13,591 | — | |||||||||
Impairment of inventory and long lived assets | 3,605 | 227,412 | 38,328 | |||||||||
Cumulative effect adjustment before noncontrolling interest | — | 700 | (1,899 | ) | ||||||||
Depreciation, amortization and accretion, net | 28,389 | 23,693 | 31,845 | |||||||||
Share-based compensation expense | 3,821 | 9,386 | 9,291 | |||||||||
Tax benefits from share-based compensation | — | (1,265 | ) | (3,719 | ) | |||||||
Securities activities, net | (4,116 | ) | (9,707 | ) | (9,795 | ) | ||||||
Net losses (gains) on sales of real estate owned, loans and office properties and equipment | (2,448 | ) | 201 | (5,079 | ) | |||||||
Net gain on sale of Ryan Beck Holdings, Inc. | — | (2,175 | ) | — | ||||||||
Originations and repayments of loans held for sale, net | (59,323 | ) | (90,745 | ) | (93,887 | ) | ||||||
Proceeds from sales of loans held for sale | 53,564 | 96,470 | 87,793 | |||||||||
Equity in earnings from Bluegreen | (13,696 | ) | (10,275 | ) | (9,445 | ) | ||||||
Equity in earnings from unconsolidated affiliates | (323 | ) | (115 | ) | — | |||||||
Impairment of unconsolidated affiliates | 96,579 | — | — | |||||||||
Impairment of investments | 15,548 | — | — | |||||||||
Impairment of goodwill | 46,564 | — | — | |||||||||
Deferred income tax provision (benefit) | 50,260 | (44,024 | ) | (20,625 | ) | |||||||
Net losses (gains) associated with debt redemption | 1,238 | — | (71 | ) | ||||||||
Increase in forgivable notes receivable, net | — | (673 | ) | (6,111 | ) | |||||||
(Increase) decrease in real estate held for development and sale | (8,582 | ) | 27,006 | (259,629 | ) | |||||||
(Increase) decrease in securities owned, net | — | (23,855 | ) | 67,910 | ||||||||
Increase (decrease) securities sold but not yet purchased | — | 28,419 | (3,770 | ) | ||||||||
Decrease (increase) in accrued interest receivable | 4,454 | 1,405 | (6,183 | ) | ||||||||
Decrease (increase) in other assets | 15,584 | (12,204 | ) | (6,465 | ) | |||||||
Increase (decrease) in due to clearing agent | — | 9,657 | (40,115 | ) | ||||||||
Decrease in customer deposits | (123 | ) | (23,974 | ) | (8,990 | ) | ||||||
Decrease in other liabilities | (30,858 | ) | (45,712 | ) | (21,058 | ) | ||||||
Net cash provided by (used in) operating activities | 36,498 | 630 | (241,606 | ) | ||||||||
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Consolidated Statements of Cash Flows
(In thousands)
For the Years Ended December 31, | ||||||||||||
2008 | 2007 | 2006 | ||||||||||
Investing activities: | ||||||||||||
Proceeds from redemption and maturity of investment securities and tax certificates | $ | 349,397 | 208,345 | 199,482 | ||||||||
Purchase of investment securities and tax certificates | (377,983 | ) | (211,402 | ) | (236,962 | ) | ||||||
Purchase of securities available for sale | (288,241 | ) | (682,231 | ) | (143,272 | ) | ||||||
Proceeds from sales and maturities of securities available for sale | 541,381 | 719,898 | 181,444 | |||||||||
Decrease (increase) in restricted cash | (19,081 | ) | (1,576 | ) | 651 | |||||||
Purchases of FHLB stock | (47,655 | ) | (22,725 | ) | (49,950 | ) | ||||||
Redemption of FHLB stock | 67,051 | 28,939 | 39,664 | |||||||||
Distributions from unconsolidated subs | 3,189 | 8,186 | 5,303 | |||||||||
Investments in unconsolidated subsidiaries | (66 | ) | (6,863 | ) | (10,323 | ) | ||||||
Net repayments (purchases and originations) of loans | 23,285 | (2,173 | ) | (106,123 | ) | |||||||
Proceeds from the sale of loans receivable | 10,100 | — | — | |||||||||
Additions to real estate owned | (19 | ) | (2,011 | ) | — | |||||||
Proceeds from sales of real estate owned | 3,810 | 2,252 | 4,382 | |||||||||
Proceeds from sales of property and equipment | 6,693 | 969 | 2,055 | |||||||||
Purchases of office property and equipment, net | (12,648 | ) | (103,033 | ) | (121,680 | ) | ||||||
Net cash outflows from the sale of Central Florida stores | (4,491 | ) | — | — | ||||||||
Equity securities received from Ryan Beck Holdings, Inc. earnout | (11,309 | ) | — | — | ||||||||
Deconsolidation of Woodbridge’s subsidiary cash balance | — | (6,387 | ) | — | ||||||||
Net proceeds from the sale of Ryan Beck Holdings, Inc. | — | 2,628 | — | |||||||||
Acquisition in Pizza Fusion Class B preferred shares | (3,000 | ) | — | — | ||||||||
Acquisition of BankAtlantic Bancorp Class A shares | (3,925 | ) | — | — | ||||||||
Acquisition of Woodbridge Class A shares | — | (33,205 | ) | — | ||||||||
Net cash (used in) provided by investing activities | $ | 236,488 | (100,389 | ) | (235,329 | ) | ||||||
Financing activities: | ||||||||||||
Net increase in deposits | $ | (3,482 | ) | 86,369 | 114,360 | |||||||
Prepayments of FHLB advances | (694,363 | ) | — | — | ||||||||
Net proceeds (repayments) of FHLB advances | 262,808 | (120,000 | ) | 233,656 | ||||||||
Net decrease in securities sold under agreements to repurchase | (9,543 | ) | (45,456 | ) | (13,403 | ) | ||||||
Net increase (decrease) in federal funds purchased | 129,364 | 76,949 | (107,449 | ) | ||||||||
Repayments of secured borrowings | — | — | (26,516 | ) | ||||||||
Prepayment of notes and bonds payable | (2,751 | ) | — | — | ||||||||
Repayment of notes and bonds payable | (32,055 | ) | (162,213 | ) | (216,891 | ) | ||||||
Proceeds from notes and bonds payable | 27,522 | 236,839 | 384,732 | |||||||||
Issuance of junior subordinated debentures | — | 30,929 | 30,928 | |||||||||
Payments for debt issuance costs | (518 | ) | (1,695 | ) | (3,043 | ) | ||||||
Capital contributions in managed fund by investors | — | — | 2,905 | |||||||||
Capital withdrawals in managed fund by investors | — | — | (4,203 | ) | ||||||||
Excess tax benefits from share-based compensation | — | 1,265 | 3,719 | |||||||||
Proceeds from the issuance of BFC Class A Common Stock, net of issuance costs | — | 36,121 | — | |||||||||
Proceeds from the exercise of stock options | — | 187 | — | |||||||||
Preferred stock dividends paid | (750 | ) | (750 | ) | (750 | ) | ||||||
Purchase and retirement of Class A common stock | (54 | ) | — | — | ||||||||
Purchase and retirement of Woodbridge common stock | (1,439 | ) | — | — | ||||||||
Purchase and retirement of BankAtlantic Bancorp Class A common stock | — | (53,769 | ) | — | ||||||||
Proceeds from the issuance of Woodbridge Class A common stock, net of issuance costs | — | 152,651 | — | |||||||||
Payment of the minimum withholding tax upon the exercise of stock options | — | — | (6,871 | ) | ||||||||
Proceeds from issuance of BankAtlantic Bancorp Class A common stock | 103 | 2,449 | 1,479 | |||||||||
Purchase of subsidiary common stock | — | — | (7,833 | ) | ||||||||
BankAtlantic Bancorp common stock dividends paid to non-BFC shareholders | (636 | ) | (5,746 | ) | (7,592 | ) | ||||||
Woodbridge common stock dividends paid to non-BFC shareholders | — | (330 | ) | (1,322 | ) | |||||||
Distribution from venture partnership to minority holders | (410 | ) | — | — | ||||||||
Net cash (used in) provided by financing activities | (326,204 | ) | 233,800 | 375,906 | ||||||||
Increase (decrease) in cash and cash equivalents | (53,218 | ) | 134,041 | (101,029 | ) | |||||||
Cash and cash equivalents at beginning of period | 332,155 | 201,123 | 305,437 | |||||||||
Cash and cash equivalents of discontinued assets held for sale at disposal date | — | (6,294 | ) | — | ||||||||
Cash and cash equivalents of discontinued assets held for sale | — | 3,285 | (3,285 | ) | ||||||||
Cash and cash equivalents at end of period | $ | 278,937 | 332,155 | 201,123 | ||||||||
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Consolidated Statements of Cash Flows
(In thousands)
For the Years Ended December 31, | ||||||||||||
2008 | 2007 | 2006 | ||||||||||
Supplemental cash flow information: | ||||||||||||
Interest on borrowings and deposits | $ | 153,168 | 197,157 | 167,430 | ||||||||
Income taxes (refunded) paid | (44,100 | ) | 5,409 | 39,770 | ||||||||
Supplementary disclosure of non-cash investing and financing activities: | ||||||||||||
Loans and tax certificates transferred to REO | 7,208 | 2,528 | 23,728 | |||||||||
Securities held-to-maturity transferred to securities available for sale | — | 203,004 | — | |||||||||
Long-lived assets held-for-use transferred to assets held for sale | — | 13,704 | — | |||||||||
Securities purchased pending settlement | — | 18,926 | — | |||||||||
Decrease in additional paid in capital from the re-classification of the 5% Preferred Stock to Redeemable Preferred stock (see Note 34) | 11,029 | — | — | |||||||||
Decrease in inventory from the reclassification to to property and equipment | — | 2,859 | 8,412 | |||||||||
Reduction in loan participations sold accounted for as secured borrowings | — | — | 111,754 | |||||||||
Exchange branch facilities | — | — | 2,350 | |||||||||
Increase (decrease) in accumulated other comprehensive income, net of taxes | (3,894 | ) | 145 | 926 | ||||||||
Net decrease in shareholders’ equity from the effect of subsidiaries’ capital transactions, net of taxes | 2,398 | (101 | ) | (16 | ) | |||||||
Issuance and retirement of BFC Class A Common Stock accepted as consideration for the exercise price of stock options | — | — | 4,154 | |||||||||
Increase in deferred tax liability due to cumulative impact of change in accounting for uncertainties in income taxes (FIN 48 - see Note 25) | — | 121 | — |
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1. | Organization and Summary of Significant Accounting Policies |
Percent | ||||||||||||
Shares | Percent of | of | ||||||||||
Owned | Ownership | Vote | ||||||||||
BankAtlantic Bancorp | ||||||||||||
Class A Common Stock (1) | 2,389,697 | 23.30 | % | 12.35 | % | |||||||
Class B Common Stock | 975,225 | 100.00 | % | 47.00 | % | |||||||
Total | 3,364,922 | 29.96 | % | 59.35 | % | |||||||
Woodbridge Holdings Corporation | ||||||||||||
Class A Common Stock (2) | 3,735,392 | 22.43 | % | 11.89 | % | |||||||
Class B Common Stock | 243,807 | 100.00 | % | 47.00 | % | |||||||
Total | 3,979,199 | 23.55 | % | 58.89 | % |
(1) | In August 2008 and December 2008, BFC purchased an aggregate of 400,000 shares and 323,848 shares, respectively, of BankAtlantic Bancorp’s Class A common stock on the open market for an aggregate purchase price of $2.8 million and $1.1 million, respectively. BFC’s August 2008 and December 2008 acquisitions of BankAtlantic Bancorp’s Class A common stock increased BFC’s ownership interest in BankAtlantic Bancorp by approximately 3.6% in August 2008 and 2.9% in December 2008 and increased BFC’s voting interest by approximately 2.1% in August 2008 and 1.6% in December 2008. The acquisitions of additional shares of BankAtlantic Bancorp have been accounted for as step acquisitions under the purchase method of accounting. See Note 2 for further information. | |
(2) | BFC’s percentage of vote includes 1,229,117 shares of Woodbridge’s Class A Common Stock which BFC had previously agreed not to vote (except in limited circumstances) pursuant to a letter agreement requested by Woodbridge in connection with the listing of its shares on the NYSE. |
161
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Notes to Consolidated Financial Statements
162
Table of Contents
Notes to Consolidated Financial Statements
163
Table of Contents
Notes to Consolidated Financial Statements
164
Table of Contents
Notes to Consolidated Financial Statements
165
Table of Contents
Notes to Consolidated Financial Statements
166
Table of Contents
Notes to Consolidated Financial Statements
167
Table of Contents
Notes to Consolidated Financial Statements
168
Table of Contents
Notes to Consolidated Financial Statements
169
Table of Contents
Notes to Consolidated Financial Statements
170
Table of Contents
Notes to Consolidated Financial Statements
171
Table of Contents
Notes to Consolidated Financial Statements
172
Table of Contents
Notes to Consolidated Financial Statements
2. | Business Combination and Step Acquisitions |
173
Table of Contents
Notes to Consolidated Financial Statements
174
Table of Contents
Notes to Consolidated Financial Statements
3. | Discontinued Operations |
175
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Notes to Consolidated Financial Statements
Consideration received: | ||||
Stifel common stock and Warrants | $ | 107,445 | ||
Cash | 2,628 | |||
Total consideration received | 110,073 | |||
Net assets disposed: | ||||
Discontinued operations assets held for sale at disposal date | 206,763 | |||
Discontinued operations liabilities held for sale at disposal date | (117,364 | ) | ||
Net assets available for sale at disposal date | 89,399 | |||
Transaction cost | 2,709 | |||
Gain on disposal of Ryan Beck before income taxes and noncontrolling interest | 17,965 | |||
Provision for income taxes | 2,959 | |||
Noncontrolling interest | 12,831 | |||
Net gain on sale of Ryan Beck | $ | 2,175 | ||
For the Years Ended | ||||||||
December 31, | ||||||||
2007 | 2006 | |||||||
Financial Services: | ||||||||
Investment banking revenue | $ | 37,836 | 218,461 | |||||
Expenses: | ||||||||
Employee compensation and benefits | 27,532 | 170,605 | ||||||
Occupancy and equipment | 2,984 | 16,588 | ||||||
Advertising and promotion | 740 | 5,788 | ||||||
Transaction related costs (1) | 14,263 | — | ||||||
Other expenses: | ||||||||
Professional fees | 1,106 | 8,790 | ||||||
Communications | 2,255 | 15,187 | ||||||
Floor broker and clearing fees | 1,162 | 8,612 | ||||||
Interest expense | 985 | 5,995 | ||||||
Other | 1,086 | 6,389 | ||||||
Total expenses | 52,113 | 237,954 | ||||||
Loss from Ryan Beck discontinued operations before income taxes and noncontrolling interest | (14,277 | ) | (19,493 | ) | ||||
Income tax benefit | (6,431 | ) | (8,958 | ) | ||||
Noncontrolling interest | (6,709 | ) | (9,011 | ) | ||||
Loss from Ryan Beck discontinued operations, net of income taxes and noncontrolling interest | $ | (1,137 | ) | (1,524 | ) | |||
(1) | Ryan Beck sale related costs include $9.3 million of change in control payments, $3.5 million of one-time employee termination benefits and $1.5 million of share-based compensation. |
4. | Segment Reporting |
176
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Notes to Consolidated Financial Statements
177
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Notes to Consolidated Financial Statements
BankAtlantic | ||||||||||||||||||||||||||||
Bancorp | Woodbridge | Adjustments | ||||||||||||||||||||||||||
BFC | Other | Land | Other | and | ||||||||||||||||||||||||
2008 | Activities | BankAtlantic | Operations | Division | Operations | Eliminations | Total | |||||||||||||||||||||
Revenues: | ||||||||||||||||||||||||||||
Sales of real estate | $ | — | — | — | 11,268 | 2,484 | 85 | 13,837 | ||||||||||||||||||||
Interest and dividend income | 1,376 | 313,307 | 1,445 | 1,931 | 2,418 | (1,379 | ) | 319,098 | ||||||||||||||||||||
Other income | 5,853 | 135,799 | 671 | 14,341 | 2,692 | (4,821 | ) | 154,535 | ||||||||||||||||||||
Total revenues | 7,229 | 449,106 | 2,116 | 27,540 | 7,594 | (6,115 | ) | 487,470 | ||||||||||||||||||||
Costs and Expenses: | ||||||||||||||||||||||||||||
Cost of sale of real estate | — | — | — | 6,742 | 16,151 | (10,055 | ) | 12,838 | ||||||||||||||||||||
Interest expense, net | — | 119,534 | 21,262 | 3,637 | 8,115 | (1,379 | ) | 151,169 | ||||||||||||||||||||
Provision for loan losses | — | 135,383 | 24,418 | — | — | — | 159,801 | |||||||||||||||||||||
Other expenses | 12,393 | 328,534 | 8,741 | 24,608 | 26,597 | (4,821 | ) | 396,052 | ||||||||||||||||||||
Total costs and expenses | 12,393 | 583,451 | 54,421 | 34,987 | 50,863 | (16,255 | ) | 719,860 | ||||||||||||||||||||
Equity in (loss) earnings from unconsolidated affiliates | (152 | ) | 920 | 600 | — | 13,696 | — | 15,064 | ||||||||||||||||||||
Impairment of unconsolidated affiliates | — | — | — | — | (96,579 | ) | — | (96,579 | ) | |||||||||||||||||||
Impairment of investments | (3,574 | ) | — | — | — | (11,974 | ) | (15,548 | ) | |||||||||||||||||||
Loss from continuing operations before income taxes and noncontrolling interest | (8,890 | ) | (133,425 | ) | (51,705 | ) | (7,447 | ) | (138,126 | ) | 10,140 | (329,453 | ) | |||||||||||||||
(Benefit) provision for income taxes | (14,887 | ) | 31,121 | 1,395 | (1,866 | ) | — | — | 15,763 | |||||||||||||||||||
Noncontrolling interest | 12 | (122,035 | ) | (39,381 | ) | (4,651 | ) | (115,105 | ) | 8,449 | (272,711 | ) | ||||||||||||||||
Income (loss) from continuing operations | $ | 5,985 | (42,511 | ) | (13,719 | ) | (930 | ) | (23,021 | ) | 1,691 | (72,505 | ) | |||||||||||||||
At December 31, 2008 | ||||||||||||||||||||||||||||
Total assets | $ | 26,468 | 5,713,690 | 542,478 | 339,941 | 220,587 | (447,582 | ) | 6,395,582 | |||||||||||||||||||
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BankAtlantic | ||||||||||||||||||||||||||||||||||||
Bancorp | Woodbridge | Adjusting | ||||||||||||||||||||||||||||||||||
BFC | Other | Primary | Tennessee | Land | Other | and | ||||||||||||||||||||||||||||||
2007 | Activities | BankAtlantic | Operations | Homebuilding | Homebuilding | Division | Operations | Eliminations | Total | |||||||||||||||||||||||||||
Revenues: | ||||||||||||||||||||||||||||||||||||
Sales of real estate | $ | — | — | — | 345,666 | 42,042 | 16,567 | 6,574 | (734 | ) | 410,115 | |||||||||||||||||||||||||
Interest and dividend income | 2,374 | 369,570 | 2,320 | 613 | 39 | 3,880 | 7,158 | (8,050 | ) | 377,904 | ||||||||||||||||||||||||||
Other income | 6,272 | 143,193 | 6,969 | 8,523 | 44 | 8,194 | 1,174 | (3,821 | ) | 170,548 | ||||||||||||||||||||||||||
8,646 | 512,763 | 9,289 | 354,802 | 42,125 | 28,641 | 14,906 | (12,605 | ) | 958,567 | |||||||||||||||||||||||||||
Costs and Expenses: | ||||||||||||||||||||||||||||||||||||
Cost of sales of real estate | — | — | — | 501,206 | 51,360 | 7,447 | 16,793 | (3,565 | ) | 573,241 | ||||||||||||||||||||||||||
Interest expense, net | — | 170,060 | 23,054 | 7,258 | 151 | 2,629 | 1,073 | (7,746 | ) | 196,479 | ||||||||||||||||||||||||||
Provision for loan losses | — | 70,842 | — | — | — | — | — | — | 70,842 | |||||||||||||||||||||||||||
Other expenses | 15,272 | 313,898 | 4,282 | 63,107 | 5,010 | 19,077 | 34,898 | (3,738 | ) | 451,806 | ||||||||||||||||||||||||||
15,272 | 554,800 | 27,336 | 571,571 | 56,521 | 29,153 | 52,764 | (15,049 | ) | 1,292,368 | |||||||||||||||||||||||||||
Equity in (loss) earnings from unconsolidated affiliates | (78 | ) | 1,219 | 1,281 | 40 | — | — | 10,262 | — | 12,724 | ||||||||||||||||||||||||||
Loss from continuing operations before income taxes and noncontrolling interest | (6,704 | ) | (40,818 | ) | (16,766 | ) | (216,729 | ) | (14,396 | ) | (512 | ) | (27,596 | ) | 2,444 | (321,077 | ) | |||||||||||||||||||
(Benefit) provision for income taxes | (19,271 | ) | (21,378 | ) | (6,194 | ) | (1,396 | ) | 1,700 | 5,910 | (34,297 | ) | 5,914 | (69,012 | ) | |||||||||||||||||||||
Noncontrolling interest | (34 | ) | (14,773 | ) | (8,034 | ) | (179,268 | ) | (13,400 | ) | (5,346 | ) | 5,579 | (2,889 | ) | (218,165 | ) | |||||||||||||||||||
(Loss) income from continuing operations | $ | 12,601 | (4,667 | ) | (2,538 | ) | (36,065 | ) | (2,696 | ) | (1,076 | ) | 1,122 | (581 | ) | (33,900 | ) | |||||||||||||||||||
At December 31, 2007 | ||||||||||||||||||||||||||||||||||||
Total assets | $ | 30,166 | 6,161,962 | 758,372 | 38,497 | — | 380,961 | 298,700 | (554,225 | ) | 7,114,433 | |||||||||||||||||||||||||
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BankAtlantic | ||||||||||||||||||||||||||||||||||||
Bancorp | Woodbridge | Adjusting | ||||||||||||||||||||||||||||||||||
BFC | Other | Primary | Tennessee | Land | Other | and | ||||||||||||||||||||||||||||||
2006 | Activities | BankAtlantic | Operations | Homebuilding | Homebuilding | Division | Operations | Eliminations | Total | |||||||||||||||||||||||||||
Revenues: | ||||||||||||||||||||||||||||||||||||
Sales of real estate | $ | — | — | — | 424,420 | 76,299 | 69,778 | 11,041 | (15,452 | ) | 566,086 | |||||||||||||||||||||||||
Interest and dividend income | 2,292 | 364,949 | 2,448 | 434 | 110 | 961 | 3,377 | (2,671 | ) | 371,900 | ||||||||||||||||||||||||||
Other income | 3,680 | 131,811 | 9,138 | 6,897 | 17 | 5,505 | 2,254 | (2,708 | ) | 156,594 | ||||||||||||||||||||||||||
5,972 | 496,760 | 11,586 | 431,751 | 76,426 | 76,244 | 16,672 | (20,831 | ) | 1,094,580 | |||||||||||||||||||||||||||
Costs and Expenses: | ||||||||||||||||||||||||||||||||||||
Cost of sale of real estate | — | — | — | 367,252 | 72,807 | 42,662 | 11,649 | (11,409 | ) | 482,961 | ||||||||||||||||||||||||||
Interest expense, net | — | 145,344 | 21,933 | — | — | — | — | (699 | ) | 166,578 | ||||||||||||||||||||||||||
Provision for loan losses | — | 8,574 | — | — | — | — | — | — | 8,574 | |||||||||||||||||||||||||||
Other expenses | 12,835 | 293,448 | 6,738 | 67,414 | 14,113 | 15,119 | 28,182 | (2,626 | ) | 435,223 | ||||||||||||||||||||||||||
12,835 | 447,366 | 28,671 | 434,666 | 86,920 | 57,781 | 39,831 | (14,734 | ) | 1,093,336 | |||||||||||||||||||||||||||
Equity in (loss) earnings from unconsolidated affiliates | — | 33 | 1,634 | (279 | ) | — | — | 9,547 | — | 10,935 | ||||||||||||||||||||||||||
(Loss) income from continuing operations before income taxes and noncontrolling interest | (6,863 | ) | 49,427 | (15,451 | ) | (3,194 | ) | (10,494 | ) | 18,463 | (13,612 | ) | (6,097 | ) | 12,179 | |||||||||||||||||||||
Provision (benefit) for income taxes | (1,857 | ) | 13,105 | (6,008 | ) | (1,508 | ) | (3,241 | ) | 6,936 | (5,639 | ) | (2,318 | ) | (530 | ) | ||||||||||||||||||||
Noncontrolling interest | (25 | ) | 28,474 | (7,403 | ) | (1,406 | ) | (6,048 | ) | 9,613 | (6,649 | ) | (3,150 | ) | 13,406 | |||||||||||||||||||||
(Loss) income from continuing operations | $ | (4,981 | ) | 7,848 | (2,040 | ) | (280 | ) | (1,205 | ) | 1,914 | (1,324 | ) | (629 | ) | (697 | ) | |||||||||||||||||||
At December 31, 2006 | ||||||||||||||||||||||||||||||||||||
Total assets | $ | 45,756 | 6,187,122 | 796,629 | 644,447 | 62,065 | 271,169 | 146,116 | (547,538 | ) | 7,605,766 | |||||||||||||||||||||||||
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5. | Cumulative-Effect Adjustment for Quantifying Financial Statement Misstatements |
Cumulative Effect | ||||
Adjustment | ||||
As of January 1, 2006 | ||||
Other liabilities: | ||||
Recurring operating expenses (1) | $ | 1,618 | ||
Deferred data processing expenses (2) | 1,474 | |||
Current taxes payable | (696 | ) | ||
Increase in other liabilities | 2,396 | |||
Decrease in deferred tax liability | (657 | ) | ||
Decrease in noncontrolling interest | (1,486 | ) | ||
Decrease in retained earnings | $ | 253 | ||
(1) | BankAtlantic has historically expensed certain recurring invoices when paid. The effect of this accounting policy was not material to the Company’s financial statements in any given year as the “rollover” impact of expenses in the following year approximated the expenses that rolled over from the prior year. | |
(2) | BankAtlantic pays a fixed fee for certain data processing transaction services, and at the end of each contract year, the actual number of transactions is determined and the fees related to any greater or lesser transactions are invoiced or repaid to BankAtlantic over a twelve month period. BankAtlantic accounted for these charges when paid. The effect of this accounting policy was not material to the Company’s financial statements in any given year and the amount of the error had accumulated over a four year period as follows (in thousands): |
For the Years | Occupancy and | |||
Ended December 31, | Equipment Expense | |||
2002 | $ | 221 | ||
2003 | 276 | |||
2004 | 533 | |||
2005 | 444 | |||
$ | 1,474 | |||
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6. | Restructuring Charges, Impairments and Exit Activities |
Employee | ||||||||||||
Termination | ||||||||||||
Benefits | Contract | Total | ||||||||||
Liability | Liability | Liability | ||||||||||
Balance at January 1, 2007 | $ | — | — | — | ||||||||
Restructuring charges | 2,527 | 1,016 | 3,543 | |||||||||
Amounts paid or amortized | (2,425 | ) | (26 | ) | (2,451 | ) | ||||||
Balance at December 31, 2007 | $ | 102 | 990 | 1,092 | ||||||||
Employee | ||||||||||||
Termination | ||||||||||||
Benefits | Contract | Total | ||||||||||
Liability | Liability | Liability | ||||||||||
Balance at January 1, 2008 | $ | 102 | 990 | 1,092 | ||||||||
Expense incurred | 2,171 | 2,385 | 4,556 | |||||||||
Amounts paid or amortized | (2,102 | ) | (1,913 | ) | (4,015 | ) | ||||||
Balance at December 31 , 2008 | $ | 171 | 1,462 | 1,633 | ||||||||
For the Years Ended | ||||||||
December 31, | ||||||||
2008 | 2007 | |||||||
Asset impairment | $ | 4,758 | 4,808 | |||||
Employee termination costs | 2,171 | 2,527 | ||||||
Lease termination, net | 2,385 | 1,016 | ||||||
Reversal of deferred rent upon lease termination | (2,186 | ) | — | |||||
Loss on central Florida branch sale | 267 | — | ||||||
Total | $ | 7,395 | 8,351 | |||||
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Amount | ||||
Assets sold: | ||||
Loans | $ | 6,470 | ||
Property and equipment | 13,373 | |||
Total assets sold | 19,843 | |||
Liabilities transferred: | ||||
Deposits | (24,477 | ) | ||
Other liabilities | (346 | ) | ||
Total liabilities transferred | (24,823 | ) | ||
Net liability transferred | (4,980 | ) | ||
Deposit premium | 654 | |||
Purchase transaction costs | (165 | ) | ||
Net cash outflows from sales of stores | $ | (4,491 | ) | |
Severance | Independent | Surety | ||||||||||||||||||
Related and | Contractor | Bond | ||||||||||||||||||
Benefits | Facilities | Agreements | Accrual | Total | ||||||||||||||||
Balance at December 31, 2006 | $ | — | — | — | — | — | ||||||||||||||
Restructuring charges | 4,864 | 1,010 | 1,497 | 1,826 | 9,197 | |||||||||||||||
Cash payments | (2,910 | ) | — | (76 | ) | — | (2,986 | ) | ||||||||||||
Balance at December 31, 2007 | $ | 1,954 | 1,010 | 1,421 | 1,826 | 6,211 | ||||||||||||||
Restructuring charges | 2,238 | 140 | — | (150 | ) | 2,228 | ||||||||||||||
Cash payments | (4,063 | ) | (446 | ) | (824 | ) | (532 | ) | (5,865 | ) | ||||||||||
Balance at December 31, 2008 | $ | 129 | 704 | 597 | 1,144 | 2,574 | ||||||||||||||
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7. | Goodwill |
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8. | Federal Funds Sold and Other Short Term Investments |
For the Years Ended December 31, | ||||||||||||
2008 | 2007 | 2006 | ||||||||||
Ending Balance | $ | 20,825 | 484 | 691 | ||||||||
Maximum outstanding at any month end within period | $ | 362,360 | 21,555 | 16,276 | ||||||||
Average amount invested during period | $ | 44,031 | 3,638 | 1,824 | ||||||||
Average yield during period | %1.92 | 4.77 | 3.00 |
9. | Securities Available for Sale |
December 31, 2008 | ||||||||||||||||
Gross | Gross | |||||||||||||||
Amortized | Unrealized | Unrealized | Estimated | |||||||||||||
Cost | Gains | Losses | Fair Value | |||||||||||||
Government agency securities: | ||||||||||||||||
Mortgage-backed securities | $ | 521,895 | 11,017 | 39 | 532,873 | |||||||||||
Real estate mortgage investment conduits(1) | 165,449 | 1,846 | 944 | 166,351 | ||||||||||||
Total mortgage-backed securities | 687,344 | 12,863 | 983 | 699,224 | ||||||||||||
Investment Securities: | ||||||||||||||||
Tax-exempt securities | — | — | — | — | ||||||||||||
Other bonds | 250 | — | — | 250 | ||||||||||||
Benihana Convertible Preferred Stock (see Note 12) | 16,426 | — | — | 16,426 | ||||||||||||
Equity securities | 6,686 | 112 | — | 6,798 | ||||||||||||
Total investment securities | 23,362 | 112 | — | 23,474 | ||||||||||||
Total | $ | 710,706 | 12,975 | 983 | 722,698 | |||||||||||
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December 31, 2007 | ||||||||||||||||
Gross | Gross | |||||||||||||||
Amortized | Unrealized | Unrealized | Estimated | |||||||||||||
Cost | Gains | Losses | Fair Value | |||||||||||||
Government agency securities: | ||||||||||||||||
Mortgage-backed securities | $ | 585,796 | 4,378 | 555 | 589,619 | |||||||||||
Real estate mortgage investment conduits(1) | 199,886 | 1,359 | 2,403 | 198,842 | ||||||||||||
Total mortgage-backed securities | 785,682 | 5,737 | 2,958 | 788,461 | ||||||||||||
Investment Securities: | ||||||||||||||||
Tax-exempt securities | — | — | — | — | ||||||||||||
Other bonds | 685 | — | 4 | 681 | ||||||||||||
Equity securities | 123,876 | 13,289 | — | 137,165 | ||||||||||||
Total investment securities | 124,561 | 13,289 | 4 | 137,846 | ||||||||||||
Total | $ | 910,243 | 19,026 | 2,962 | 926,307 | |||||||||||
(1) | Real estate mortgage investment conduits are pass-through entities that hold residential loans, and investors are issued ownership interests in the entities in the form of a bond. The securities were issued by government agencies. |
As of December 31, 2008 | ||||||||||||||||||||||||
Less Than 12 Months | 12 Months or Greater | Total | ||||||||||||||||||||||
Fair | Unrealized | Fair | Unrealized | Fair | Unrealized | |||||||||||||||||||
Value | Losses | Value | Losses | Value | Losses | |||||||||||||||||||
Mortgage-backed securities | $ | 4,736 | (39 | ) | — | — | 4,736 | (39 | ) | |||||||||||||||
Real estate mortgage investment conduits | — | — | 27,426 | (944 | ) | 27,426 | (944 | ) | ||||||||||||||||
Total available for sale securities: | $ | 4,736 | (39 | ) | 27,426 | (944 | ) | 32,162 | (983 | ) | ||||||||||||||
As of December 31, 2007 | ||||||||||||||||||||||||
Less Than 12 Months | 12 Months or Greater | Total | ||||||||||||||||||||||
Fair | Unrealized | Fair | Unrealized | Fair | Unrealized | |||||||||||||||||||
Value | Losses | Value | Losses | Value | Losses | |||||||||||||||||||
Mortgage-backed securities | $ | 68,821 | (396 | ) | 14,792 | (159 | ) | 83,613 | (555 | ) | ||||||||||||||
Real estate mortgage investment conduits | 3,475 | (5 | ) | 35,398 | (2,398 | ) | 38,873 | (2,403 | ) | |||||||||||||||
Other bonds | 200 | — | 246 | (4 | ) | 446 | (4 | ) | ||||||||||||||||
Total available for sale securities: | $ | 72,496 | (401 | ) | 50,436 | (2,561 | ) | 122,932 | (2,962 | ) | ||||||||||||||
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Debt Securities | ||||||||
Available for Sale | ||||||||
Estimated | ||||||||
Amortized | Fair | |||||||
December 31, 2008 (1) (2) | Cost | Value | ||||||
Due within one year | $ | — | — | |||||
Due after one year, but within five years | 279 | 281 | ||||||
Due after five years, but within ten years | 868 | 867 | ||||||
Due after ten years | 686,447 | 698,326 | ||||||
Total | $ | 687,594 | 699,474 | |||||
(1) | Scheduled maturities in the above table may vary significantly from actual maturities due to prepayments. | |
(2) | Scheduled maturities are based upon contractual maturities. |
For the Years Ended December 31, | ||||||||||||
2008 | 2007 | 2006 | ||||||||||
Gross gains on securities sales | $ | 8,378 | 17,026 | 10,137 | ||||||||
Gross losses on securities sales | $ | (5,103 | ) | (4,341 | ) | (168 | ) | |||||
Proceeds from sales of securities | $ | 395,770 | 625,095 | 70,300 | ||||||||
Other-than-temporary impairments | $ | (3,413 | ) | — | — | |||||||
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December 31, | ||||
2008 | ||||
Total cost | $ | 33,978 | ||
Sale of portion of Office Depot common stock | (17,726 | ) | ||
Other-than-temporary impairment | (11,974 | ) | ||
Total fair value | $ | 4,278 | ||
December 31, 2008 | ||||||||||||||
Gross | Gross | Estimated | ||||||||||||
Amortized | Unrealized | Unrealized | Fair | |||||||||||
Cost | Gains | Losses | Value | |||||||||||
Private investment securities (3) | 12,008 | 467 | — | 12,475 | ||||||||||
December 31, 2007 | ||||||||||||||||
Gross | Gross | Estimated | ||||||||||||||
Amortized | Unrealized | Unrealized | Fair | |||||||||||||
Cost | Gains | Losses | Value | |||||||||||||
Stifel restricted common stock (1) | $ | 31,433 | 3,061 | — | $ | 34,494 | ||||||||||
Private investment securities | 8,740 | 1,407 | — | 10,147 | ||||||||||||
Benihana Convertible Preferred Stock (2) | 20,000 | — | — | 20,000 | ||||||||||||
Equity securities (4) | — | 603 | — | 603 | ||||||||||||
$ | 60,173 | 5,071 | — | $ | 65,244 | |||||||||||
(1) | Stifel common stock that was subject to restrictions for more than one year was accounted for as investment securities at cost. | |
(2) | Historically, the Company’s investment in Benihana’s Convertible Preferred Stock has been classified as investment securities and has been carried at historical cost (see Note 12). | |
(3) | Private investment securities consist of equity instruments purchased through private placements and are accounted for at historical cost adjusted for other-than-temporary declines in value. | |
(4) | Equity securities consisted of 3,587 shares of MasterCard Class B common stock acquired through MasterCard’s 2006 initial public offering. |
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11. | Tax Certificates |
As of December 31, 2008 | As of December 31, 2007 | |||||||||||||||
Estimated | Estimated | |||||||||||||||
Amortized | Fair | Amortized | Fair | |||||||||||||
Cost | Value | Cost | Value | |||||||||||||
Tax certificates (1) — | ||||||||||||||||
Net of allowance of $6,064 and $3,289, respectively | $ | 213,534 | 224,434 | 188,401 | 188,401 | |||||||||||
(1) | The estimated fair value was calculated at December 31, 2008 from an expected cash flow model discounted at an interest rate that takes into account the risk of the cash flows of tax certificates relative to alternative investments. At December 31, 2007, management considered the estimated fair value equivalent to book value for tax certificates since these securities have no stated maturity and generally redeem in two years or less. |
For the Years Ended December 31, | ||||||||||||
2008 | 2007 | 2006 | ||||||||||
Balance, beginning of period | $ | 3,289 | 3,699 | 3,271 | ||||||||
Charge-offs | (4,668 | ) | (867 | ) | (295 | ) | ||||||
Recoveries | 157 | 157 | 423 | |||||||||
Net (charge-offs) recoveries | (4,511 | ) | (710 | ) | 128 | |||||||
Provision charged to non-interest expense | 7,286 | 300 | 300 | |||||||||
Balance, end of period | $ | 6,064 | 3,289 | 3,699 | ||||||||
12. | Benihana Convertible Preferred Stock Investment |
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13. | Loans Receivable and Loans Held for Sale |
December 31, | December 31, | |||||||
2008 | 2007 | |||||||
Real estate loans: | ||||||||
Residential | $ | 1,916,562 | 2,155,752 | |||||
Builder land loans | 84,453 | 149,564 | ||||||
Land acquisition and development | 182,585 | 202,177 | ||||||
Land acquisition, development and construction | 104,629 | 151,321 | ||||||
Construction and development | 229,856 | 265,163 | ||||||
Commercial | 713,571 | 534,916 | ||||||
Consumer — home equity | 718,950 | 676,262 | ||||||
Small business | 218,694 | 211,797 | ||||||
Other loans: | ||||||||
Commercial business | 144,554 | 131,044 | ||||||
Small business — non-mortgage | 108,230 | 105,867 | ||||||
Consumer loans | 16,406 | 15,667 | ||||||
Deposit overdrafts | 9,730 | 15,005 | ||||||
Total gross loans | 4,448,220 | 4,614,535 | ||||||
Adjustments: | ||||||||
Premiums, discounts and net deferred fees | 3,221 | 3,936 | ||||||
Allowance for loan losses | (137,257 | ) | (94,020 | ) | ||||
Loans receivable – net | $ | 4,314,184 | 4,524,451 | |||||
Loans held for sale | $ | 3,461 | 4,087 | |||||
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As of December 31, | ||||||||
2008 | 2007 | |||||||
Residential | $ | — | 2,982 | |||||
Construction and development | 124,332 | 214,159 | ||||||
Commercial | 38,930 | 105,336 | ||||||
Total undisbursed loans in process | $ | 163,262 | $ | 322,477 | ||||
Florida | 60 | % | ||
Eastern U.S.A. | 21 | % | ||
Western U.S.A. | 15 | % | ||
Central U.S.A | 4 | % | ||
100 | % | |||
For the Years Ended December 31, | ||||||||||||
2008 | 2007 | 2006 | ||||||||||
Balance, beginning of period | $ | 94,020 | 44,173 | 41,830 | ||||||||
Loans charged-off | (117,874 | ) | (23,213 | ) | (8,905 | ) | ||||||
Recoveries of loans previously charged-off | 1,310 | 2,218 | 2,674 | |||||||||
Net (charge-offs) recoveries | (116,564 | ) | (20,995 | ) | (6,231 | ) | ||||||
Provision for loan losses | 159,801 | 70,842 | 8,574 | |||||||||
Balance, end of period | $ | 137,257 | 94,020 | 44,173 | ||||||||
As of December 31, 2008 | As of December 31, 2007 | |||||||||||||||
Gross | Gross | |||||||||||||||
Recorded | Specific | Recorded | Specific | |||||||||||||
Investment | Allowances | Investment | Allowances | |||||||||||||
Impaired loans with specific valuation allowances | $ | 174,710 | 41,192 | 113,955 | 17,809 | |||||||||||
Impaired loans without specific valuation allowances | 138,548 | — | 67,124 | — | ||||||||||||
Total | $ | 313,258 | 41,192 | 181,079 | 17,809 | |||||||||||
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For the Years Ended December 31, | ||||||||||||
2008 | 2007 | 2006 | ||||||||||
Contracted interest income | $ | 14,276 | 15,042 | 2,715 | ||||||||
Interest income recognized | (3,368 | ) | (10,071 | ) | (2,203 | ) | ||||||
Foregone interest income | $ | 10,908 | 4,971 | 512 | ||||||||
As of December 31, | ||||||||||||
2008 | 2007 | 2006 | ||||||||||
Non-accrual — tax certificates | $ | 1,441 | 2,094 | 632 | ||||||||
Non-accrual – loans | ||||||||||||
Residential | 34,734 | 8,678 | 2,629 | |||||||||
Commercial real estate and business | 241,274 | 165,818 | — | |||||||||
Small business | 4,644 | 877 | 244 | |||||||||
Consumer | 6,763 | 3,218 | 1,563 | |||||||||
Total non-accrual loans | 287,415 | 178,591 | 4,436 | |||||||||
Real estate owned | 19,045 | 17,216 | 21,747 | |||||||||
Total non-performing assets | $ | 307,901 | 197,901 | 26,815 | ||||||||
As of December 31, | ||||||||||||
2008 | 2007 | 2006 | ||||||||||
Performing impaired loans, net of specific allowances | $ | — | — | 162 | ||||||||
Loan 90 days past due and still accruing | 15,721 | — | — | |||||||||
Troubled debt restructured | 28,173 | 2,488 | — | |||||||||
Total potential problem loans | $ | 43,894 | 2,488 | 162 | ||||||||
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For the Years Ended December 31, | ||||||||||||
2008 | 2007 | 2006 | ||||||||||
Real estate acquired in settlement of loans and tax certificates: | ||||||||||||
Operating expenses, net | $ | (1,243 | ) | (243 | ) | (224 | ) | |||||
Impairment of REO | (1,465 | ) | (7,299 | ) | 9 | |||||||
Net (loss) gain on sales | (124 | ) | 427 | 1,443 | ||||||||
Net (loss) gain on real estate owned activity | $ | (2,832 | ) | (7,115 | ) | 1,228 | ||||||
14. | Properties and Equipment |
December 31, | ||||||||
2008 | 2007 | |||||||
Land, buildings and improvements | $ | 292,328 | 315,430 | |||||
Furniture and equipment | 104,363 | 115,504 | ||||||
Water irrigation facilities | 12,346 | 11,515 | ||||||
Total | 409,037 | 442,449 | ||||||
Less accumulated depreciation | 93,690 | 81,560 | ||||||
Properties and equipment — net | $ | 315,347 | 360,889 | |||||
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15. | Real Estate Held for Development and Sale |
December 31, | ||||||||
2008 | 2007 | |||||||
Land and land development costs | $ | 221,684 | 216,090 | |||||
Construction costs | 463 | 5,426 | ||||||
Capitalized interest and other costs | 38,539 | 35,009 | ||||||
Land held for sale | 8,077 | 13,704 | ||||||
Total | $ | 268,763 | 270,229 | |||||
16. | Capitalized Interest |
For the Years Ended December 31, | ||||||||||||
2008 | 2007 | 2006 | ||||||||||
Interest expense | $ | 162,669 | 243,439 | 209,509 | ||||||||
Interest capitalized | (11,500 | ) | (46,960 | ) | (42,931 | ) | ||||||
Interest expense, net | $ | 151,169 | 196,479 | 166,578 | ||||||||
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17. | Investments in Unconsolidated Affiliates |
December 31, | ||||||||
2008 | 2007 | |||||||
Investment in Bluegreen Corporation | $ | 29,789 | 111,321 | |||||
Investments in joint ventures | 2,973 | 5,615 | ||||||
BankAtlantic Bancorp investment in statutory business trusts | 8,218 | 8,820 | ||||||
Woodbridge investment in statutory business trusts | 406 | 2,565 | ||||||
$ | 41,386 | 128,321 | ||||||
For the Years Ended December 31, | ||||||||||||
2008 | 2007 | 2006 | ||||||||||
Earnings from Bluegreen | $ | 13,696 | 10,275 | 9,684 | ||||||||
Loss from joint ventures | (152 | ) | (51 | ) | (416 | ) | ||||||
Earnings from statutory trusts | 1,520 | 2,500 | 1,667 | |||||||||
$ | 15,064 | 12,724 | 10,935 | |||||||||
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December 31, | ||||
2008 | ||||
Prorata share of Bluegreen’s net loss | $ | (154 | ) | |
Amortization of basis difference | 13,850 | |||
Total earnings from Bluegreen Corporation | $ | 13,696 | ||
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December 31, | ||||
2008 | ||||
Prorata share of investment in Bluegreen Corporation | $ | 115,072 | ||
Purchase accounting adjustment (from the step acquisition) | (4,700 | ) | ||
Amortization of basis difference | 13,850 | |||
Less: Impairment of investment in Bluegreen Corporation | (94,433 | ) | ||
Investment in Bluegreen Corporation | $ | 29,789 | ||
(In thousands)
December 31, | ||||||||
2008 | 2007 | |||||||
Total assets | $ | 1,193,507 | 1,039,578 | |||||
Total liabilities | 781,522 | 632,047 | ||||||
Minority interest | 29,518 | 22,423 | ||||||
Total shareholders’ equity | 382,467 | 385,108 | ||||||
Total liabilities and shareholders’ equity | $ | 1,193,507 | 1,039,578 | |||||
(In thousands)
Year Ended | Year Ended | Year Ended | ||||||||||
December 31, | December 31, | December 31, | ||||||||||
2008 | 2007 | 2006 | ||||||||||
Revenues and other income | $ | 602,043 | 691,494 | 671,509 | ||||||||
Cost and other expenses | 594,698 | 632,280 | 609,018 | |||||||||
Income before minority interest and provision for income taxes | 7,345 | 59,214 | 62,491 | |||||||||
Minority interest | 7,095 | 7,721 | 7,319 | |||||||||
Income before provision for income taxes | 250 | 51,493 | 55,172 | |||||||||
Provision for income taxes | (766 | ) | (19,567 | ) | (20,861 | ) | ||||||
(Loss) income before cumulative effect of change in accounting principle | (516 | ) | 31,926 | 34,311 | ||||||||
Cumulative effect of change in accounting principle, net of tax | — | — | (5,678 | ) | ||||||||
Minority interest in cumulative effect of change in accounting principle | — | — | 1,184 | |||||||||
Net (loss) income | $ | (516 | ) | 31,926 | 29,817 | |||||||
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As of December 31, | ||||||||
Statement of Financial Condition | 2008 | 2007 | ||||||
Junior subordinated debentures | $ | 294,195 | 294,195 | |||||
Other assets | 1,035 | 1,072 | ||||||
Total Assets | $ | 295,230 | 295,267 | |||||
Trust preferred securities | $ | 285,375 | 285,375 | |||||
Other liabilities | 1,035 | 1,072 | ||||||
Total Liabilities | 286,410 | 286,447 | ||||||
Common securities | 8,820 | 8,820 | ||||||
Total Liabilities and Equity | $ | 295,230 | 295,267 | |||||
For the Years Ended December 31, | ||||||||||||
Statement of Operations | 2008 | 2007 | 2006 | |||||||||
Interest income from subordinated debentures | $ | 20,197 | 22,274 | 20,913 | ||||||||
Interest expense | (19,596 | ) | (21,612 | ) | (20,286 | ) | ||||||
Net income | $ | 601 | 662 | 627 | ||||||||
18. | Deposits |
As of December 31, | ||||||||||||||||
2008 | 2007 | |||||||||||||||
Amount | Percent | Amount | Percent | |||||||||||||
Interest free checking | $ | 741,691 | 18.89 | % | 824,211 | 20.85 | % | |||||||||
Insured money fund savings | ||||||||||||||||
0.70% at December 31, 2008 | 427,762 | 10.89 | ||||||||||||||
2.45% at December 31, 2007, | 624,390 | 15.79 | ||||||||||||||
NOW accounts | ||||||||||||||||
0.50% at December 31, 2008 | 992,762 | 25.28 | ||||||||||||||
1.50% at December 31, 2007, | 900,233 | 22.77 | ||||||||||||||
Savings accounts | ||||||||||||||||
0.50% at December 31, 2008 | 419,494 | 10.68 | ||||||||||||||
1.50% at December 31, 2007, | 580,497 | 14.68 | ||||||||||||||
Total non-certificate accounts | 2,581,709 | 65.74 | 2,929,331 | 74.09 | ||||||||||||
Certificate accounts: | ||||||||||||||||
Less than 2.00% | 189,528 | 4.83 | 16,261 | 0.41 | ||||||||||||
2.01% to 3.00% | 145,188 | 3.70 | 52,435 | 1.33 | ||||||||||||
3.01% to 4.00% | 598,461 | 15.24 | 164,744 | 4.17 | ||||||||||||
4.01% to 5.00% | 337,885 | 8.61 | 445,498 | 11.27 | ||||||||||||
5.01% to 6.00% | 67,108 | 1.71 | 339,625 | 8.59 | ||||||||||||
6.01% to 7.00% | 6 | — | 32 | — | ||||||||||||
Total certificate accounts | 1,338,176 | 34.09 | 1,018,595 | 25.77 | ||||||||||||
Total deposit accounts | 3,919,885 | 99.83 | 3,947,926 | 99.86 | ||||||||||||
Premium on brokered deposits | (89 | ) | — | — | — | |||||||||||
Interest earned not credited to deposit accounts | 6,572 | 0.17 | 5,479 | 0.14 | ||||||||||||
Total | $ | 3,926,368 | 100.00 | % | 3,953,405 | 100.00 | % | |||||||||
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For the Years Ended December 31, | ||||||||||||
2008 | 2007 | 2006 | ||||||||||
Money fund savings and NOW accounts | $ | 17,783 | 26,031 | 20,413 | ||||||||
Savings accounts | 4,994 | 12,559 | 2,936 | |||||||||
Certificate accounts — below $100,000 | 21,195 | 25,512 | 23,136 | |||||||||
Certificate accounts, $100,000 and above | 20,856 | 21,002 | 13,048 | |||||||||
Less early withdrawal penalty | (565 | ) | (628 | ) | (574 | ) | ||||||
Total | $ | 64,263 | 84,476 | 58,959 | ||||||||
For the Years Ended December 31, | ||||||||||||||||||||||||
Interest Rates | 2009 | 2010 | 2011 | 2012 | 2013 | Thereafter | ||||||||||||||||||
0.00% to 2.00% | $ | 188,928 | 434 | 128 | — | 26 | 11 | |||||||||||||||||
2.01% to 3.00% | 136,775 | 6,505 | 1,342 | 159 | 407 | — | ||||||||||||||||||
3.01% to 4.00% | 581,465 | 7,435 | 3,408 | 2,718 | 3,431 | 4 | ||||||||||||||||||
4.01% to 5.00% | 283,391 | 13,687 | 6,798 | 26,576 | 7,433 | — | ||||||||||||||||||
5.01% to 6.00% | 38,579 | 25,204 | 699 | 870 | 1,757 | — | ||||||||||||||||||
6.01% and greater | 6 | — | — | — | — | — | ||||||||||||||||||
Total | $ | 1,229,144 | 53,265 | 12,375 | 30,323 | 13,054 | 15 | |||||||||||||||||
December 31, | ||||
2008 | ||||
3 months or less | $ | 259,704 | ||
4 to 6 months | 159,763 | |||
7 to 12 months | 170,000 | |||
More than 12 months | 74,232 | |||
Total | $ | 663,699 | ||
2008 | 2007 | |||||||
Brokered deposits | $ | 239,888 | 14,665 | |||||
Public deposits | 243,745 | 323,879 | ||||||
Total institutional deposits | $ | 483,633 | 338,544 | |||||
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19. | Advances from Federal Home Loan Bank |
Weighted | Weighted | |||||||||||
Average | Average | |||||||||||
Maturity | Interest | Outstanding | ||||||||||
Advances Maturing During the Year Ended: | Date | Rate | Balance | |||||||||
December 31, 2009 | 7/10/2009 | 3.69 | % | $ | 565,271 | |||||||
December 31, 2010 | 4/13/2010 | 2.84 | % | 402,220 | ||||||||
Total advances from the FHLB | $ | 967,491 | ||||||||||
20. | Federal Funds Purchased and Treasury Borrowings |
As of December 31, | ||||||||||||
2008 | 2007 | 2006 | ||||||||||
Ending balance | $ | 238,339 | 108,975 | 32,026 | ||||||||
Maximum outstanding at any month end within period | $ | 238,339 | 175,000 | 266,237 | ||||||||
Average amount outstanding during period | $ | 78,125 | 115,334 | 176,237 | ||||||||
Average interest cost during period | %2.23 | 5.17 | 5.17 |
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21. | Securities Sold Under Agreements to Repurchase |
For the Years Ended December 31, | ||||||||||||
2008 | 2007 | 2006 | ||||||||||
Maximum borrowing at any month-end within the period | $ | 55,179 | 109,430 | 202,607 | ||||||||
Average borrowing during the period | $ | 63,529 | 73,848 | 123,944 | ||||||||
Average interest cost during the period | %2.23 | 4.88 | 4.83 | |||||||||
Average interest cost at end of the period | %0.12 | 3.46 | 5.17 |
Weighted | ||||||||||||||||
Estimated | Average | |||||||||||||||
Amortized | Fair | Repurchase | Interest | �� | ||||||||||||
Cost | Value | Balance | Rate | |||||||||||||
December 31, 2008 (1) | ||||||||||||||||
Mortgage-backed securities | $ | 46,689 | 47,896 | 41,387 | 0.12 | % | ||||||||||
REMIC | 0 | 0 | 0 | 0.00 | ||||||||||||
Total | $ | 46,689 | 47,896 | 41,387 | 0.00 | % | ||||||||||
December 31, 2007 (1) | ||||||||||||||||
Mortgage-backed securities | $ | 30,028 | 30,251 | 23,468 | 3.46 | % | ||||||||||
REMIC | 37,796 | 35,398 | 27,462 | 3.46 | ||||||||||||
Total | $ | 67,824 | 65,649 | 50,930 | 3.46 | % | ||||||||||
(1) | At December 31, 2008 and 2007, all securities were classified as available for sale and were recorded at fair value in the consolidated statements of financial condition. |
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22. | Subordinated Debentures, Notes and Bonds Payable, Secured Borrowings, Junior Subordinated Debentures and Other Liabilities |
December 31, | Interest | Maturity | ||||||||||
2008 | 2007 | Rate | Date | |||||||||
BFC borrowings | ||||||||||||
Revolving Line of Credit | $ | — | LIBOR +2.80 | December 15, 2007 | ||||||||
Mortgage payables | 8 | 29 | 6.00% | June 2009 | ||||||||
Total BFC borrowings | 8 | 29 | ||||||||||
BankAtlantic borrowings | ||||||||||||
Subordinated debentures (1) | 22,000 | 22,000 | LIBOR + 3.45% | November 7, 2012 | ||||||||
Mortgage-Backed Bond | 864 | 4,654 | (2) | September 30, 2013 | ||||||||
Total BankAtlantic borrowings | 22,864 | 26,654 | ||||||||||
Woodbridge Borrowings | ||||||||||||
Land acquisition and | (a) | 140,034 | 136,266 | From LIBOR | Range from June | |||||||
development mortgage notes | (e) | +2.5% to Fixed | 2011 to October | |||||||||
payable | 6.88% | 2019 | ||||||||||
Commercial development | (b) | 71,905 | 76,278 | From LIBOR + | Range from June | |||||||
mortgage notes payable | (e) | 1.70% to Prime | 2009 to July 2010 | |||||||||
Borrowing base facility | (c) | 37,458 | 39,674 | Prime | March 2011 | |||||||
Other mortgage notes payable | (d) | 11,831 | 12,027 | Fixed 5.47% | April 2015 | |||||||
Development Bonds | 3,291 | 3,350 | Fixed from 6% to 6.13% | 2035 | ||||||||
Other borrowings | 381 | 1,143 | Fixed from 2.44% to 9.15% | Range from July 2009 to June 2013 | ||||||||
Total Woodbridge borrowings | 264,900 | 268,738 | ||||||||||
Total | $ | 287,772 | 295,421 | |||||||||
(1) | LIBOR interest rates are indexed to 3-month LIBOR and adjust quarterly. | |
(2) | The bonds adjust semi-annually to the ten year treasury constant maturity rate minus 23 basis points. |
(a) | Core Communities’ land acquisition and development mortgage notes payable are collateralized by inventory of real estate and property and equipment with approximate net carrying values aggregating $174.5 million and $159.2 million as of December 31, 2008 and 2007, respectively. Core has a credit agreement with a financial institution which provides for borrowings of up to $88.9 million. This facility matures in June 2011 and has a loan to value limitation of 55%. As of December 31, 2008, $86.9 million was outstanding with no current availability for further borrowing based on available collateral. Core has a credit agreement with a financial institution which provides for borrowings of up to $33.0 million. This facility matures in October 2019. As of December 31, 2008, $23.2 million was outstanding with no current availability for further borrowing based on available collateral. Core has a credit agreement with a financial institution which provides for borrowing of up to $5.0 million. This facility matures in October 2019. As of December 31, 2008, $4.9 million was outstanding, with no current availability for further borrowing based on available collateral. These notes accrue interest, payable monthly, at fixed and varying rates and are tied to various indices as noted above. For certain notes, principal payments are required monthly or quarterly as the note dictates. Core had a $50.0 million revolving credit facility with a loan to value limitation of 75% for construction financing for the development of the Tradition Hilton Head master-planned community which was subsequently modified in 2008 to $25.0 million. This agreement had a provision that required additional principal payments, known as curtailment payments, in the event that actual sales were below the contractual requirements. A curtailment payment of $14.9 million was paid in January 2008. On June 27, 2008, Core modified this loan agreement, terminating the revolving feature of the loan and reducing an approximately $19 million curtailment payment due in June 2008 to $17.0 million, $5.0 million of which was paid in June 2008. The loan was further modified in December 2008, reducing the loan to $25 million, eliminating the curtailment requirements, extending the loan to February 2012 and increasing the rate to Prime Rate plus 1%, with a floor of 5.00%, and the establishment of an interest reserve classified as restricted cash. As of December 31, 2008, |
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$25.0 million was outstanding, with no current availability for borrowing based on available collateral. The facility is due and payable on February 28, 2012. | ||
(b) | Core Communities has three credit agreements with a financial institution which provide for borrowings of up to $80.3 million. As of December 31, 2008, $71.9 million was outstanding, with no current availability for further borrowing based on available collateral. These credit agreements required debt service coverage ratios of up to 1.15. Core also has a credit agreement with a financial institution which provides for borrowing of up to $64.3 million. This facility matures in June 2009 and, as of December 31, 2008 $58.3 million was outstanding with no current availability for borrowing based on available collateral In July 2008, one of these credit agreements was refinanced by a $9.1 million construction loan. The new loan has an interest rate of 30-day LIBOR plus 210 basis points or Prime Rate, a maturity date of July 2010 with a one year extension subject to certain conditions and has an outstanding balance of $8.9 million at December 31, 2008. In 2008, Core extended the maturity of another $6.9 million credit agreement from June 2008 to June 2010, which had an outstanding balance of $4.7 million at December 31, 2008. These notes accrue interest at varying rates tied to various indices as noted above and interest is payable monthly. For certain notes, principal payments are required monthly. Core Communities’ commercial development mortgage notes payable are collateralized by commercial property with approximate net carrying values aggregating $96.1 million and $103.2 million as of December 31, 2008 and 2007, respectively. | |
(c) | Levitt and Sons had a $100.0 million revolving working capital, land acquisition, development and residential construction borrowing base facility agreement with 75% loan to value limitation and borrowed $30.2 million under the facility (the “Carolina Oak Loan”). The proceeds were used to finance the inter-company purchase of a 150 acre parcel in Tradition Hilton Head from Core Communities and to refinance a $15.0 million line of credit. In October 2007, in connection with Woodbridge’s acquisition from Levitt and Sons of the membership interests in Carolina Oak, Woodbridge became the obligor for the entire Carolina Oak Loan $34.1 million outstanding balance at the time of acquisition. The Carolina Oak Loan was modified in connection with the acquisition and had an outstanding balance of $37.5 million at December 31, 2008. The Carolina Oak Loan is collateralized by a first mortgage on the 150 acre parcel in Tradition, Hilton Head which had approximate net carrying values aggregating $27.6 million and $38.5 million as of December 31, 2008 and 2007, respectively. The Carolina Oak Loan is due and payable on March 21, 2011 and may be extended at the lender’s sole discretion on the anniversary date of the facility. Interest accrues at the Prime Rate and is payable monthly. At December 31, 2008, there was no availability to draw on this facility based on available collateral. | |
(d) | Woodbridge entered into a mortgage note payable agreement with a financial institution in March 2005 to repay the bridge loan used to temporarily fund Woodbridge’s purchase of an office building in Fort Lauderdale. This note payable is collateralized by the office building which had approximate net carrying values aggregating $13.7 million and $14.2 million as of December 31, 2008 and 2007, respectively. The note payable contains a balloon payment requirements of approximately $10.4 million at the maturity date in April 2015. Principal and interest are payable monthly. | |
(e) | Core Communities’ credit facilities generally require it to maintain minimum net worth and minimum working capital levels, the most restrictive of which is a minimum net worth of $75 million and minimum liquidity of $7.5 million. |
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December 31, | Beginning | |||||||||||||||||||||
2008 | 2007 | Optional | ||||||||||||||||||||
Issue | Outstanding | Outstanding | Interest | Maturity | Redemption | |||||||||||||||||
Junior Subordinated Debentures | Date | Amount | Amount | Rate | Date | Date | ||||||||||||||||
BBX Capital Trust I(A) | 06/26/2007 | $ | 25,774 | 25,774 | LIBOR + 1.45% | 09/15/2037 | 09/15/2012 | |||||||||||||||
BBX Capital Trust II(A) | 09/20/2007 | 5,155 | 5,155 | LIBOR + 1.50% | 12/15/2037 | 12/15/2012 | ||||||||||||||||
BBX Capital Trust II | 03/05/2002 | 57,088 | 57,088 | 8.50% | 03/31/2032 | 03/31/2007 | ||||||||||||||||
BBX Capital Trust III | 06/26/2002 | 25,774 | 25,774 | LIBOR + 3.45% | 06/26/2032 | 06/26/2007 | ||||||||||||||||
BBX Capital Trust IV | 09/26/2002 | 25,774 | 25,774 | LIBOR + 3.40% | 09/26/2032 | 09/26/2007 | ||||||||||||||||
BBX Capital Trust V | 09/27/2002 | 10,310 | 10,310 | LIBOR + 3.40% | 09/30/2032 | 09/27/2007 | ||||||||||||||||
BBX Capital Trust VI | 12/10/2002 | 15,450 | 15,450 | LIBOR + 3.35% | 12/10/2032 | 12/10/2007 | ||||||||||||||||
BBX Capital Trust VII | 12/19/2002 | 25,774 | 25,774 | LIBOR + 3.25% | 12/19/2032 | 12/19/2007 | ||||||||||||||||
BBX Capital Trust VIII | 12/19/2002 | 15,464 | 15,464 | LIBOR + 3.35% | 01/07/2033 | 12/19/2007 | ||||||||||||||||
BBX Capital Trust IX | 12/19/2002 | 10,310 | 10,310 | LIBOR + 3.35% | 01/07/2033 | 12/19/2007 | ||||||||||||||||
BBX Capital Trust X | 03/26/2003 | 51,548 | 51,548 | LIBOR + 3.15% | 03/26/2033 | 03/26/2008 | ||||||||||||||||
BBX Capital Trust XI | 04/10/2003 | 10,310 | 10,310 | LIBOR + 3.25% | 04/24/2033 | 04/24/2008 | ||||||||||||||||
BBX Capital Trust XII | 03/27/2003 | 15,464 | 15,464 | LIBOR + 3.25% | 04/07/2033 | 04/07/2008 | ||||||||||||||||
Total BankAtlantic Bancorp | 294,195 | 294,195 | ||||||||||||||||||||
Unsecured junior subordinated debentures — Levitt Capital Trust I (“LCT I”) | 03/15/2005 | 23,196 | 23,196 | From fixed 8.11% to LIBOR + 3.85% | 03/01/2035 | 3/15/2010 | ||||||||||||||||
Unsecured junior subordinated debentures — Levitt Capital Trust II (“LCT II”) | 05/04/2005 | 30,928 | 30,928 | From fixed 8.09% to LIBOR + 3.80% | 06/30/2035 | 05/04/2010 | ||||||||||||||||
Unsecured junior subordinated debentures — Levitt Capital Trust III (“LCT III”) | 06/01/2006 | 15,464 | 15,464 | From fixed 9.25% to LIBOR + 3.80% | 06/30/2036 | 06/30/2011 | ||||||||||||||||
Unsecured junior subordinated debentures — Levitt Capital Trust IV (“LCTIV”) | 07/18/2006 | 15,464 | 15,464 | From fixed 9.35% to LIBOR + 3.80% | 09/30/2036 | 09/30/2011 | ||||||||||||||||
Total Woodbridge | 85,052 | 85,052 | ||||||||||||||||||||
Purchase Accounting | (3,143 | ) | (24 | ) | ||||||||||||||||||
Total Junior Subordinated Debentures | $ | 376,104 | 379,223 | |||||||||||||||||||
Consolidated | ||||
December 31, 2008 | ||||
Year ended December 31, 2009 | $ | 3,575 | ||
2010 | 8,713 | |||
2011 | 188,520 | |||
2012 | 48,309 | |||
2013 | 2,129 | |||
Thereafter | 412,630 | |||
$ | 663,876 | |||
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23. | Stock Based Compensation |
Weighted Average | ||||||||
For the Twelve Months Ended | ||||||||
December 31, | ||||||||
Employees | 2007 | 2006 | ||||||
Expected volatility | 43.05 | % | 44.22 | % | ||||
Expected dividends | 0 | % | 0 | % | ||||
Expected term (in years) | 7.5 | 7.5 | ||||||
Average risk-free interest rate | 4.94 | % | 5.01 | % | ||||
Option value | $ | 2.34 | $ | 3.54 |
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Weighted Average | ||||||||
For the Twelve Months Ended | ||||||||
December 31, | ||||||||
Non-Employees — Directors | 2008 | 2007 | ||||||
Volatility | 50.81 | % | 43.05 | % | ||||
Expected dividends | 0.00 | % | 0.00 | % | ||||
Expected term (in years) | 5.00 | 5.00 | ||||||
Risk-free rate | 3.35 | % | 4.89 | % | ||||
Option value | $ | 0.40 | $ | 1.99 |
Weighted | Weighted | |||||||||||||||
Average | Average | Aggregate | ||||||||||||||
Outstanding | Exercise | Remaining | Intrinsic | |||||||||||||
Options | Price | Contractual Term | Value ($000) | |||||||||||||
Outstanding at December 31, 2005 | 5,299,569 | $ | 2.92 | 3.12 | ||||||||||||
Exercised | (3,928,982 | ) | 2.32 | |||||||||||||
Forfeited | — | 0.00 | ||||||||||||||
Expired | — | 0.00 | ||||||||||||||
Granted | 236,500 | 6.36 | ||||||||||||||
Outstanding at December 31, 2006 | 1,607,087 | $ | 4.88 | 6.25 | $ | — | ||||||||||
Exercised | (129,769 | ) | 1.45 | |||||||||||||
Forfeited | (18,397 | ) | 4.99 | |||||||||||||
Expired | — | 0.00 | ||||||||||||||
Granted | 264,296 | 4.44 | ||||||||||||||
Outstanding at December 31, 2007 | 1,723,217 | $ | 5.07 | 6.31 | $ | — | ||||||||||
Exercised | — | 0.00 | ||||||||||||||
Forfeited | (30,000 | ) | 6.04 | |||||||||||||
Expired | (147,407 | ) | 3.68 | |||||||||||||
Granted | 252,150 | 0.83 | ||||||||||||||
Outstanding at December 31, 2008 | 1,797,960 | $ | 4.57 | 6.35 | $ | — | ||||||||||
Exercisable at December 31, 2008 | 881,158 | $ | 1.89 | 5.83 | $ | — | ||||||||||
Available for grant at December 31, 2008 | 2,015,804 | |||||||||||||||
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Weighted | ||||||||
Unvested | Average | |||||||
Restricted | Grant Date | |||||||
Stock | Fair Value | |||||||
Outstanding at December 31, 2005 | 11,262 | $ | 5.52 | |||||
Granted | 30,028 | 6.66 | ||||||
Vested | (26,276 | ) | 6.29 | |||||
Forfeited | — | — | ||||||
Outstanding at December 31, 2006 | 15,014 | $ | 6.65 | |||||
Granted | 22,522 | 4.44 | ||||||
Vested | (28,152 | ) | 3.71 | |||||
Forfeited | — | — | ||||||
Outstanding at December 31, 2007 | 9,384 | $ | 5.62 | |||||
Granted | 120,480 | 0.83 | ||||||
Vested | (79,664 | ) | 0.60 | |||||
Forfeited | — | — | ||||||
Outstanding at December 31, 2008 | 50,200 | $ | 1.26 | |||||
Stock Option Plans | ||||||||||||||||||||
Maximum | Shares | Class of | Vesting | Type of | ||||||||||||||||
Term | Authorized (3) | Stock | Requirements | Options (2) | ||||||||||||||||
1996 Stock Option Plan | 10 years | 449,219 | Class A | 5 Years (1) | ISO, NQ | |||||||||||||||
1999 Non-qualifying Stock Option Plan | 10 years | 172,500 | Class A | (1 | ) | NQ | ||||||||||||||
1999 Stock Option Plan | 10 years | 172,500 | Class A | (1 | ) | ISO, NQ | ||||||||||||||
2000 Non-qualifying Stock Option Plan | 10 years | 340,830 | Class A | immediately | NQ | |||||||||||||||
2001 Amended and Restated Stock Option Plan | 10 years | 783,778 | Class A | 5 Years (1) | ISO, NQ | |||||||||||||||
2005 Restricted Stock and Option Plan (4) | 10 years | 1,200,000 | Class A | 5 Years (1) | ISO, NQ |
(1) | Vesting is established by the BankAtlantic Bancorp Compensation Committee in connection with each grant of options or restricted stock. All directors’ stock options vest immediately. | |
(2) | ISO — Incentive Stock Option | |
NQ — Non-qualifying Stock Option | ||
(3) | During 2001 all shares remaining available for grant under all stock options plans except the 2001 stock option plan were canceled. During 2005 all shares remaining available for grant under the 2001 stock option plan were canceled. | |
(4) | The 2005 Restricted Stock and Option Plan provides that up to 1,200,000 shares of BankAtlantic Bancorp Class A common stock may be issued for restricted stock awards and upon the exercise of options granted under the Plan. |
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Class A | Weighted | |||||||
Non-vested | Average | |||||||
Restricted | Grant date | |||||||
Stock | Fair Value | |||||||
Outstanding at December 31, 2005 | 26,527 | $ | 40.00 | |||||
Vested | (6,965 | ) | 55.60 | |||||
Forfeited | — | — | ||||||
Granted | 6,278 | 73.68 | ||||||
Outstanding at December 31, 2006 | 25,840 | 43.95 | ||||||
Vested | (7,583 | ) | 48.93 | |||||
Forfeited | — | — | ||||||
Granted | 12,432 | 42.18 | ||||||
Outstanding at December 31, 2007 | 30,689 | 42.01 | ||||||
Vested | (10,295 | ) | 33.77 | |||||
Forfeited | — | — | ||||||
Granted | 5,455 | 9.70 | ||||||
Outstanding at December 31, 2008 | 25,849 | $ | 38.47 | |||||
Weighted Average | ||||||||||||
2008 | 2007 | 2006 | ||||||||||
Volatility | 46.09 | % | 29.44 | % | 31.44 | % | ||||||
Expected dividends | 1.03 | % | 1.75 | % | 1.03 | % | ||||||
Expected term (in years) | 5.00 | 7.23 | 7.45 | |||||||||
Risk-free rate | 3.29 | % | 4.92 | % | 5.19 | % |
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Weighted | Weighted | |||||||||||||||
Class A | Average | Average | Aggregate | |||||||||||||
Outstanding | Exercise | Remaining | Intrinsic | |||||||||||||
Options | Price | Contractual Term | Value ($000) | |||||||||||||
Outstanding at December 31, 2005 | 1,207,851 | $ | 45.40 | 5.7 | ||||||||||||
Exercised | (291,948 | ) | 20.65 | |||||||||||||
Forfeited | (51,955 | ) | 67.90 | |||||||||||||
Expired | (6,420 | ) | 46.49 | |||||||||||||
Granted | 190,254 | 73.75 | ||||||||||||||
Outstanding at December 31, 2006 | 1,047,782 | 56.45 | 6.4 | |||||||||||||
Exercised | (88,227 | ) | 27.75 | |||||||||||||
Forfeited | (75,486 | ) | 67.95 | |||||||||||||
Expired | (15,820 | ) | 59.25 | |||||||||||||
Granted | 196,249 | 46.79 | ||||||||||||||
Outstanding at December 31, 2007 | 1,064,498 | 56.17 | 6.2 | |||||||||||||
Exercised | (6,630 | ) | 15.60 | |||||||||||||
Forfeited | (126,678 | ) | 74.81 | |||||||||||||
Expired | (111,526 | ) | 30.50 | |||||||||||||
Granted | 75,954 | 9.70 | ||||||||||||||
Outstanding at December 31, 2008 | 895,618 | 53.09 | 5.8 | $ | — | |||||||||||
Exercisable at December 31, 2008 | 441,589 | $ | 31.87 | 4.4 | $ | — | ||||||||||
Available for grant at December 31, 2008 | 704,726 | |||||||||||||||
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Weighted | ||||||||||||||||
Weighted | Average | Aggregate | ||||||||||||||
Average | Remaining | Intrinsic | ||||||||||||||
Number | Exercise | Contractual | Value | |||||||||||||
of Options | Price | Term | (thousands) | |||||||||||||
Options outstanding at December 31, 2006 | 378,521 | $ | 103.65 | $ | — | |||||||||||
Granted | 150,489 | 45.92 | — | |||||||||||||
Exercised | — | — | — | |||||||||||||
Forfeited | 156,478 | 88.56 | — | |||||||||||||
Options outstanding at December 31, 2007 | 372,532 | $ | 86.66 | 8.00 years | — | |||||||||||
Granted | 36,398 | 6.70 | — | |||||||||||||
Exercised | — | — | — | |||||||||||||
Forfeited | 90,459 | 81.85 | — | |||||||||||||
Options outstanding at December 31, 2008 | 318,471 | $ | 78.89 | 7.19 years | $ | — | ||||||||||
Options exercisable at December 31, 2008 | 69,822 | $ | 40.20 | 8.36 years | $ | — | ||||||||||
Stock options available for equity compensation grants at December 31, 2008 | 281,529 | |||||||||||||||
Year ended | Year ended | Year ended | ||||||||||
December 31, 2008 | December 31, 2007 | December 31, 2006 | ||||||||||
Expected volatility | 65.47% | 40.05% - 52.59% | 37.37% - 39.80% | |||||||||
Expected dividend yield | 0.00% | 0.00% - 0.83% | 0.39% - 0.61% | |||||||||
Risk-free interest rate | 4.16% | 4.58% - 5.14% | 4.57% - 5.06% | |||||||||
Expected life | 5 years | 5 - 7.5 years | 5 - 7.5 years | |||||||||
Forfeiture rate — executives | 5% | 5% | 5% | |||||||||
Forfeiture rate — non-executives | — | 10% | 10% |
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Weighted Average | Weighted Average | |||||||||||||||
Grant Date | Remaining | Aggregate Intrinsic | ||||||||||||||
Number of Options | Fair Value | Contractual Term | Value (in thousands) | |||||||||||||
Non-vested at December 31, 2006 | 358,660 | $ | 103.97 | $ | — | |||||||||||
Grants | 150,489 | 45.92 | — | |||||||||||||
Vested | 13,563 | 45.80 | — | |||||||||||||
Forfeited | 156,478 | 88.56 | — | |||||||||||||
Non-vested at December 31, 2007 | 339,108 | 87.64 | 7.98 years | — | ||||||||||||
Grants | 36,398 | 6.70 | — | |||||||||||||
Vested | 36,398 | 6.70 | — | |||||||||||||
Forfeited | 90,459 | 81.85 | — | |||||||||||||
Non-vested at December 31, 2008 | 248,649 | $ | 89.75 | 6.86 years | $ | — | ||||||||||
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As of December 31, | ||||||||
2008 | 2007 | |||||||
Change in benefit obligation | ||||||||
Benefit obligation at the beginning of the year | $ | 28,918 | 29,620 | |||||
Interest cost | 1,720 | 1,656 | ||||||
Actuarial loss (gain) | 1,549 | (1,403 | ) | |||||
Benefits paid | (1,037 | ) | (955 | ) | ||||
Projected benefit obligation at end of year | 31,150 | 28,918 | ||||||
Change in plan assets | ||||||||
Fair value of Plan assets at the beginning of year | 29,104 | 28,626 | ||||||
Actual return on Plan assets | (10,146 | ) | 1,433 | |||||
Employer contribution | — | — | ||||||
Benefits paid | (1,037 | ) | (955 | ) | ||||
Fair value of Plan assets as of actuarial date | 17,921 | 29,104 | ||||||
Funded status at end of year | $ | (13,229 | ) | 186 | ||||
As of December 31, | ||||||||||||
2008 | 2007 | 2006 | ||||||||||
Net comprehensive loss | $ | 19,690 | 3,915 | 4,493 | ||||||||
As of December 31, | ||||||||
2008 | 2007 | |||||||
Projected benefit obligation | $ | 31,150 | 28,918 | |||||
Accumulated benefit obligation | 31,150 | 28,918 | ||||||
Fair value of plan assets | 17,921 | 29,104 |
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For the Years Ended | ||||||||||||
2008 | 2007 | 2006 | ||||||||||
Interest cost on projected benefit obligation | $ | 1,719 | 1,656 | 1,624 | ||||||||
Expected return on plan assets | (2,430 | ) | (2,396 | ) | (2,190 | ) | ||||||
Amortization of unrecognized net gains and losses | 463 | 501 | 933 | |||||||||
Net periodic pension (income) expense (1) | $ | (248 | ) | (239 | ) | 367 | ||||||
Other changes in Plan Assets and Benefit Obligations Recognized in Other Comprehensive Income | ||||||||||||
Change in funding status | (13,415 | ) | 1,180 | 2,236 | ||||||||
Change in deferred tax assets | (2,112 | ) | (363 | ) | (1,204 | ) | ||||||
Total recognized net periodic benefit cost and other comprehensive income | $ | (15,775 | ) | 578 | 1,399 | |||||||
(1) | The estimated net loss for the Plan that will be amortized from accumulated other comprehensive income into net periodic benefit cost over the next fiscal year is $1.6 million. |
For the Years Ended | ||||||||||||
December 31, | ||||||||||||
2008 | 2007 | 2006 | ||||||||||
Weighted average discount rate used to determine benefit obligation | 6.00 | % | 6.00 | % | 5.75 | % | ||||||
Weighted average discount rate used to to determine net periodic benefit cost | 6.00 | % | 5.75 | % | 5.50 | % | ||||||
Rate of increase in future compensation levels | N/A | N/A | N/A | |||||||||
Expected long-term rate of return | 8.50 | % | 8.50 | % | 8.50 | % |
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Quoted Prices | ||||
In Active Markets | ||||
for Identical | ||||
Assets | ||||
Asset Category | (Level 1) | |||
Cash | $ | 382 | ||
Mutual Funds: (1) | ||||
US Large Cap Growth | 1,581 | |||
US Large Cap Value | 758 | |||
US Large Cap Blend | 1,680 | |||
US Mid-Cap Growth | 450 | |||
US Mid-Cap Value | 811 | |||
US Mid-Cap Blend | 638 | |||
International Equity | 2,784 | |||
Balanced | 8,235 | |||
Common Stock (2) | 602 | |||
Total pension assets | $ | 17,921 | ||
(1) | The Plan maintains diversified mutual funds in order to diversify risks and reduce volatility while achieving the targeted asset mix. | |
(2) | This category invests in aggressive growth common stocks. |
Pension | ||||
Expected Future Service | Benefits | |||
2009 | $ | 1,269 | ||
2010 | 1,480 | |||
2011 | 1,515 | |||
2012 | 1,570 | |||
2013 | 1,659 | |||
Years 2014-2018 | 9,847 |
For the Years Ended December 31, | ||||||||||||
2008 | 2007 | 2006 | ||||||||||
Employee salary contribution Limit (1) | $ | 15.5 | 15 | 15 | ||||||||
Percentage of salary limitation | 75 | % | 75 | % | 75 | % | ||||||
Total match contribution (2) | $ | 2,551 | 2,930 | 2,461 | ||||||||
Vesting of employer match | Immediate | Immediate | Immediate |
(1) | For the year ended December 31, 2008, employees over the age of 50 were entitled to contribute $20,500. For each of the years in the two year period ended December 31, 2007, employees over the age of 50 were entitled to contribute $20,000. | |
(2) | The employer matched 100% of the first 3% of employee contributions and 50% of the next 2% of employee contributions. |
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25. | Income Taxes |
For the Years Ended December 31, | ||||||||||||
2008 | 2007 | 2006 | ||||||||||
Continuing operations | $ | 15,763 | (69,012 | ) | (530 | ) | ||||||
Discontinued operations | — | (3,472 | ) | (8,957 | ) | |||||||
Extraordinary items | — | 1,509 | — | |||||||||
Total provision (benefit) for income taxes | $ | 15,763 | (70,975 | ) | (9,487 | ) | ||||||
Continuing operations: | ||||||||||||
Current: | ||||||||||||
Federal | $ | (2,880 | ) | (33,941 | ) | 13,511 | ||||||
State | (1 | ) | 2 | 946 | ||||||||
(2,881 | ) | (33,939 | ) | 14,457 | ||||||||
Deferred: | ||||||||||||
Federal | 14,308 | (28,281 | ) | (13,977 | ) | |||||||
State | 4,336 | (6,792 | ) | (1,010 | ) | |||||||
18,644 | (35,073 | ) | (14,987 | ) | ||||||||
Provision (benefit) for income taxes | $ | 15,763 | (69,012 | ) | (530 | ) | ||||||
For the Years Ended December 31, | ||||||||||||||||||||||||
2008 (1) | 2007 (1) | 2006 (1) | ||||||||||||||||||||||
Income tax provision at expected federal income tax rate of 35% | $ | (115,309 | ) | (35.00 | )% | $ | (112,377 | ) | (35.00) | % | $ | 4,263 | 35.00 | % | ||||||||||
Increase (decrease) resulting from: | ||||||||||||||||||||||||
Taxes related to subsidiaries not consolidated for income tax purposes | (43,000 | ) | (13.05 | ) | (16,263 | ) | (5.07 | ) | 1,508 | 12.38 | ||||||||||||||
Provision (benefit) for state taxes, net of federal effect | (12,949 | ) | (3.93 | ) | (14,510 | ) | (4.52 | ) | (939 | ) | (7.71 | ) | ||||||||||||
Increase in valuation allowance | 190,516 | 57.83 | 77,586 | 24.16 | 1,694 | 13.91 | ||||||||||||||||||
Expired NOLs | 1,281 | 0.39 | 1,595 | 0.50 | — | |||||||||||||||||||
Loss from Levitt and Sons | (20,981 | ) | (6.37 | ) | — | — | ||||||||||||||||||
Goodwill impairment adjustment | 16,899 | 5.13 | — | — | 458 | 3.76 | ||||||||||||||||||
Tax-exempt interest income | (152 | ) | (0.05 | ) | (4,180 | ) | (1.30 | ) | (5,110 | ) | (41.96 | ) | ||||||||||||
Other — net | (542 | ) | (0.15 | ) | (863 | ) | (0.27 | ) | (2,404 | ) | (19.74 | ) | ||||||||||||
Provision for income taxes | $ | 15,763 | 4.78 | % | $ | (69,012 | ) | (21.49) | % | $ | (530 | ) | (4.35) | % | ||||||||||
(1) | Expected tax is computed based upon income (loss) from continuing operations before noncontrolling interest. |
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For the Years Ended December 31, | ||||||||||||
2008 | 2007 | 2006 | ||||||||||
Deferred tax assets: | ||||||||||||
Allowance for loans, REO, tax certificate losses and other reserves, for financial statement purposes | $ | 49,642 | 38,786 | 20,546 | ||||||||
Federal and State net operating loss carryforward | 141,113 | 51,645 | 30,191 | |||||||||
Investment in Levitt and Sons | 46,393 | 68,339 | — | |||||||||
Compensation expensed for books and deferred for tax purposes | 779 | 410 | 13,099 | |||||||||
Real estate held for development and sale capitalized costs for tax purposes in excess of amounts capitalized for financial statement purposes | 1,204 | 2,358 | 6,579 | |||||||||
Real estate valuation | 1,295 | — | 12,889 | |||||||||
Accumulated other comprehensive income | 2,906 | — | 896 | |||||||||
Share based compensation | 3,982 | 3,073 | 1,922 | |||||||||
Income recognized for tax purposes and deferred for financial statement purposes | 7,510 | 7,228 | 6,949 | |||||||||
Investment in securities | 5,965 | — | — | |||||||||
Investment in Bluegreen | 11,135 | — | — | |||||||||
Other | 10,337 | 8,715 | 5,000 | |||||||||
Total gross deferred tax assets | 282,261 | 180,554 | 98,071 | |||||||||
Valuation allowance | (272,765 | ) | (84,028 | ) | (5,035 | ) | ||||||
Total deferred tax assets | 9,496 | 96,526 | 93,036 | |||||||||
Deferred tax liabilities: | ||||||||||||
Subsidiaries not consolidated for income tax purposes | — | 39,592 | 55,404 | |||||||||
Investment in Bluegreen | — | 21,768 | 19,501 | |||||||||
Deferred loan income | 1,468 | 1,993 | 1,956 | |||||||||
Purchase accounting adjustments | 427 | 2,830 | 1,929 | |||||||||
Accumulated other comprehensive income | — | 3,618 | 853 | |||||||||
Prepaid pension expense | 2,625 | 2,530 | 2,438 | |||||||||
Property and equipment | 3,073 | 3,789 | 3,670 | |||||||||
Other | 1,903 | 4,077 | 1,518 | |||||||||
Total gross deferred tax liabilities | 9,496 | 80,198 | 87,269 | |||||||||
Net deferred tax asset | — | 16,329 | 5,768 | |||||||||
Less net deferred tax asset at beginning of period | (16,329 | ) | (5,768 | ) | 10,693 | |||||||
Net deferred tax liability acquired due to purchase accounting | (39 | ) | 1,866 | — | ||||||||
Implementation of FIN 48 | — | (1,798 | ) | — | ||||||||
Increase (decrease) in deferred tax liability from subsidiaries other capital transactions | 2,009 | 14 | (177 | ) | ||||||||
Reduction in deferred tax asset associated with Stifel Ryan Beck | — | 16,593 | — | |||||||||
(Decrease) increase in BFC’s accumulated other comprehensive income | (981 | ) | 95 | 580 | ||||||||
Increase in Woodbridge’s accumulated other comprehensive income | — | 894 | 600 | |||||||||
(Decrease) increase in BankAtlantic Bancorp accumulated other comprehensive income | (3,304 | ) | 4,200 | 3,161 | ||||||||
(Provision) benefit for deferred income taxes | (18,644 | ) | 32,424 | 20,625 | ||||||||
Less: Provision (benefit) for deferred income taxes - discontinued operations | — | 1,139 | (5,638 | ) | ||||||||
Less: Provision for deferred income taxes - extraordinary income | — | 1,509 | — | |||||||||
Provision (benefit) for deferred income taxes — continuing operations | $ | (18,644 | ) | 35,073 | 14,987 | |||||||
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For the Years Ended December 31, | ||||||||||||
2008 | 2007 | 2006 | ||||||||||
Balance, beginning of period | $ | 84,028 | 5,035 | 3,341 | ||||||||
Other comprehensive loss | (2,538 | ) | — | — | ||||||||
Increase in deferred tax valuation allowance | 190,516 | 77,586 | 1,694 | |||||||||
Increase in deferred tax allowance — paid in capital | 759 | 1,407 | — | |||||||||
Balance, end of period | $ | 272,765 | 84,028 | 5,035 | ||||||||
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Expiration Year | State | Federal | ||||||
2011 | $ | 1,662 | 1,831 | |||||
2012 | 669 | 984 | ||||||
2021 | 806 | 1,422 | ||||||
2022 | 824 | 1,515 | ||||||
2023 | 2,008 | 3,792 | ||||||
2024 | 28,059 | 34,714 | ||||||
2025 | 4,964 | 5,797 | ||||||
2026 | 18,497 | 18,531 | ||||||
2027 | 6,835 | 6,843 | ||||||
2028 | 4,748 | 4,754 | ||||||
Totals | $ | 69,072 | 80,183 | |||||
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For the Years Ended | ||||||||
December 31, | ||||||||
2008 | 2007 | |||||||
Balance as of beginning of period | $ | 2,559 | 2,185 | |||||
Additions based on tax positions related to current year | 542 | 1,322 | ||||||
Additions based on tax positions related to prior year | 74 | 88 | ||||||
Lapse of Statute of Limitations | (575 | ) | — | |||||
Reductions of tax positions for prior years | (29 | ) | (1,036 | ) | ||||
Balance as of end of period | $ | 2,571 | 2,559 | |||||
Year Ending December 31, | Amount | |||
2009 | 10,503 | |||
2010 | 8,972 | |||
2011 | 7,382 | |||
2012 | 6,404 | |||
2013 | 5,947 | |||
Thereafter | 69,687 | |||
Total | $ | 108,895 | ||
For the Years Ended December 31, | ||||||||||||
2008 | 2007 | 2006 | ||||||||||
Rental expense for premises and equipment | $ | 14,407 | 16,191 | 13,037 | ||||||||
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December 31, | December 31, | |||||||
2008 | 2007 | |||||||
BFC Activities | ||||||||
Guaranty agreements | $ | 38,000 | 59,112 | |||||
Financial Services | ||||||||
Commitments to sell fixed rate residential loans | 25,304 | 21,029 | ||||||
Commitments to sell variable rate residential loans | — | 1,518 | ||||||
Commitments to purchase variable rate residential loans | — | 39,921 | ||||||
Commitments to purchase fixed rate residential loans | — | 21,189 | ||||||
Commitments to originate loans held for sale | 21,843 | 18,344 | ||||||
Commitments to originate loans held to maturity | 16,553 | 158,589 | ||||||
Commitments to extend credit, including the undisbursed portion of loans in process | 597,739 | 992,838 | ||||||
Standby letters of credit | 20,558 | 41,151 | ||||||
Commercial lines of credit | 66,954 | 96,786 | ||||||
Real Estate Development | ||||||||
Continued Agreement of Indemnity- surety bonds | 19,900 | 19,100 | ||||||
Royalty fee license agreement | 923 | 1,100 |
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For Capital | To Be Considered | |||||||||||||||||||||||
Actual | Adequacy Purposes | Well Capitalized | ||||||||||||||||||||||
Amount | Ratio | Amount | Ratio | Amount | Ratio | |||||||||||||||||||
As of December 31, 2008: | ||||||||||||||||||||||||
Total risk-based capital | $ | 456,776 | 11.63 | % | $ | 314,339 | 8.00 | % | $ | 392,923 | 10.00 | % | ||||||||||||
Tier I risk-based capital | 385,006 | 9.80 | 157,169 | 4.00 | 235,754 | 6.00 | ||||||||||||||||||
Tangible capital | 385,006 | 6.80 | 84,929 | 1.50 | 84,929 | 1.50 | ||||||||||||||||||
Core capital | 385,006 | 6.80 | 226,478 | 4.00 | 283,098 | 5.00 | ||||||||||||||||||
As of December 31, 2007: | ||||||||||||||||||||||||
Total risk-based capital | 495,668 | 11.63 | 340,998 | 8.00 | 426,248 | 10.00 | ||||||||||||||||||
Tier I risk-based capital | 420,063 | 9.85 | 170,499 | 4.00 | 255,749 | 6.00 | ||||||||||||||||||
Tangible capital | 420,063 | 6.94 | 90,821 | 1.50 | 90,821 | 1.50 | ||||||||||||||||||
Core capital | 420,063 | 6.94 | 242,190 | 4.00 | 302,738 | 5.00 |
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(In thousands)
December 31, | ||||||||
2008 | 2007 | |||||||
Assets | ||||||||
Cash and cash equivalents | $ | 9,218 | 17,999 | |||||
Investment securities | 97 | 862 | ||||||
Investment in Benihana Convertible Preferred Stock | 16,426 | 20,000 | ||||||
Investment in venture partnerships | 361 | 864 | ||||||
Investment in BankAtlantic Bancorp, Inc. | 66,326 | 108,173 | ||||||
Investment in Woodbridge Holdings Corporation | 35,575 | 54,637 | ||||||
Investment in and advances to wholly owned subsidiaries | 2,323 | 1,578 | ||||||
Loans receivable | — | 3,782 | ||||||
Other assets | 835 | 906 | ||||||
Total assets | $ | 131,161 | 208,801 | |||||
Liabilities and Shareholders’ Equity | ||||||||
Advances from and negative basis in wholly owned subsidiaries | $ | 789 | 3,174 | |||||
Other liabilities | 6,476 | 7,722 | ||||||
Deferred income taxes | — | 13,868 | ||||||
Total liabilities | 7,265 | 24,764 | ||||||
Redeemable 5% Cumulative Preferred Stock | 11,029 | — | ||||||
Shareholders’ equity | 112,867 | 184,037 | ||||||
Total liabilities and shareholders’ equity | $ | 131,161 | 208,801 | |||||
(In thousands)
For the Years Ended December 31, | ||||||||||||
2008 | 2007 | 2006 | ||||||||||
Revenues | $ | 2,489 | 3,977 | 2,232 | ||||||||
Expenses | 11,405 | 9,565 | 8,413 | |||||||||
(Loss) before earnings (loss) from subsidiaries | (8,916 | ) | (5,588 | ) | (6,181 | ) | ||||||
Equity from (loss) earnings in BankAtlantic Bancorp | (56,230 | ) | (7,206 | ) | 5,807 | |||||||
Equity from loss in Woodbridge | (22,261 | ) | (39,622 | ) | (1,519 | ) | ||||||
Equity from earnings (loss) in other subsidiaries | 15 | (1,083 | ) | (658 | ) | |||||||
Loss before income taxes | (87,392 | ) | (53,499 | ) | (2,551 | ) | ||||||
Benefit for income taxes | (14,887 | ) | (19,599 | ) | (1,854 | ) | ||||||
Loss from continuing operations | (72,505 | ) | (33,900 | ) | (697 | ) | ||||||
Equity in subsidiaries’ discontinued operations, net of tax | 4,461 | 1,038 | (1,524 | ) | ||||||||
Extraordinary gain, net of tax | 9,145 | 2,403 | — | |||||||||
Net loss | (58,899 | ) | (30,459 | ) | (2,221 | ) | ||||||
5% Preferred Stock dividends | (750 | ) | (750 | ) | (750 | ) | ||||||
Net loss allocable to common stock | $ | (59,649 | ) | (31,209 | ) | (2,971 | ) | |||||
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(In thousands)
For the Years Ended December 31, | ||||||||||||
2008 | 2007 | 2006 | ||||||||||
Operating Activities: | ||||||||||||
Net cash used in operating activities | $ | (5,508 | ) | (4,505 | ) | (3,041 | ) | |||||
Investing Activities: | ||||||||||||
Proceeds from sale of investment in real estate limited partnership | — | 1,000 | — | |||||||||
Proceeds from the sale of securities | 834 | 1,336 | — | |||||||||
Distribution from partnership | 633 | — | — | |||||||||
Investment in real estate limited partnership | — | — | (1,000 | ) | ||||||||
Additions to property and equipment | (11 | ) | — | 77 | ||||||||
Acquisition of Woodbridge Class A shares | — | (33,205 | ) | — | ||||||||
Acquisition of BankAtlantic Bancorp Class A shares | (3,925 | ) | — | — | ||||||||
Net cash used in investing activities | (2,469 | ) | (30,869 | ) | (923 | ) | ||||||
Financing Activities: | ||||||||||||
Proceeds from issuance of Class A Common Stock net of issuance costs | — | 36,121 | — | |||||||||
Proceeds from issuance of Common Stock upon exercise of stock option | — | 187 | — | |||||||||
Purchase and retirement of the Company’s Class A common stock | (54 | ) | — | — | ||||||||
Payment of the minimum withholding tax upon the exercise of stock options | — | — | (4,154 | ) | ||||||||
5% Preferred Stock dividends paid | (750 | ) | (750 | ) | (750 | ) | ||||||
Net cash (used in) provided by financing activities | (804 | ) | 35,558 | (4,904 | ) | |||||||
(Decrease) increase in cash and cash equivalents | (8,781 | ) | 184 | (8,868 | ) | |||||||
Cash at beginning of period | 17,999 | 17,815 | 26,683 | |||||||||
Cash at end of period | $ | 9,218 | 17,999 | 17,815 | ||||||||
Supplementary disclosure of non-cash investing and financing activities | ||||||||||||
Net increase (decrease) in shareholders’ equity from the effect of subsidiaries capital transactions, net of income taxes | $ | 2,398 | (101 | ) | (16 | ) | ||||||
(Decrease) increase in accumulated other comprehensive income, net of taxes | (3,894 | ) | 145 | 926 | ||||||||
Decrease in additional paid in capital from the re-classification of the 5% Preferred Stock to Redeemable Preferred Stock | 11,029 | — | — | |||||||||
Issuance and retirement of Common Stock accepted as consideration for the exercise price of stock options | — | — | 4,154 | |||||||||
Cumulative effect adjustment upon adoption of FASB Interpretation No. 48 | — | 121 | — |
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December 31, | ||||||||
2008 | 2007 | |||||||
BankAtlantic Bancorp | $ | 170,888 | 351,148 | |||||
Woodbridge | 91,389 | 207,138 | ||||||
Joint Venture Partnership | 277 | 664 | ||||||
$ | 262,554 | 558,950 | ||||||
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Fair Value Measurements at December 31, 2008 Using: | ||||||||||||||||
Quoted prices in | ||||||||||||||||
Active Markets | Significant Other | Significant | ||||||||||||||
for Identical | Observable | Unobservable | ||||||||||||||
December 31, | Assets | Inputs | Inputs | |||||||||||||
Description | 2008 | (Level 1) | (Level 2) | (Level 3) | ||||||||||||
Securities Available for Sale: | ||||||||||||||||
Mortgage-backed securities | $ | 532,873 | — | 532,873 | — | |||||||||||
REMICS | 166,351 | — | 166,351 | — | ||||||||||||
Bonds | 250 | — | — | 250 | ||||||||||||
Benihana Convertible Preferred Stock | 16,426 | — | — | 16,426 | ||||||||||||
Other equity securities | 6,798 | 5,210 | — | 1,588 | ||||||||||||
Total securities available for sale at fair value | $ | 722,698 | 5,210 | 699,224 | 18,264 | |||||||||||
Benihana | ||||||||||||||||||||
Convertible | ||||||||||||||||||||
Stifel | Preferred | Equity | ||||||||||||||||||
Bonds | Warrants | Stock | Securities | Total | ||||||||||||||||
Beginning Balance | $ | 681 | 10,661 | 20,000 | 5,133 | 36,475 | ||||||||||||||
Total gains and losses (realized/unrealized) | ||||||||||||||||||||
Included in earnings (or changes in net assets) | — | 3,704 | (3,574 | ) | (3,412 | ) | (3,282 | ) | ||||||||||||
Included in other comprehensive Income | 1 | — | — | (133 | ) | (132 | ) | |||||||||||||
Purchases, issuances, and settlements | (432 | ) | (14,365 | ) | — | — | (14,797 | ) | ||||||||||||
Transfers in and/or out of Level 3 | — | — | — | — | — | |||||||||||||||
Ending balance | $ | 250 | — | 16,426 | 1,588 | 18,264 | ||||||||||||||
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Fair Value Measurements at December 31, 2008 | ||||||||||||||||||||
Quoted prices in | ||||||||||||||||||||
Active Markets | Significant | Significant | ||||||||||||||||||
for Identical | Other Observable | Unobservable | ||||||||||||||||||
December 31, | Assets | Inputs | Inputs | Total | ||||||||||||||||
2008 | (Level 1) | (Level 2) | (Level 3) | Impairments | ||||||||||||||||
Description | ||||||||||||||||||||
Loans measured for impairment using the fair value of the collateral | $ | 209,012 | — | — | 209,012 | 103,193 | ||||||||||||||
Investment in Bluegreen | 29,789 | 29,789 | 94,433 | |||||||||||||||||
Woodbridge’s investment in unconsolidated trusts | 406 | 406 | 2,159 | |||||||||||||||||
Private equity investments | 536 | 536 | 1,148 | |||||||||||||||||
Total | $ | 239,743 | 29,789 | — | 209,954 | 200,933 | ||||||||||||||
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December 31, 2008 | December 31, 2007 | |||||||||||||||
Carrying | Fair | Carrying | Fair | |||||||||||||
Amount | Value | Amount | Value | |||||||||||||
Financial assets: | ||||||||||||||||
Cash and cash equivalents | $ | 278,937 | 278,937 | 332,155 | 332,154 | |||||||||||
Restricted cash | 21,288 | 21,288 | 2,207 | 2,207 | ||||||||||||
Securities available for sale | 722,698 | 722,698 | 926,307 | 926,307 | ||||||||||||
Financial instruments | — | — | 10,661 | 10,661 | ||||||||||||
Investment securities | 12,008 | 12,475 | 60,173 | 64,666 | ||||||||||||
Tax Certificates | 213,534 | 244,806 | 188,401 | 188,401 | ||||||||||||
Federal home loan bank stock | 54,607 | 54,607 | 74,003 | 74,003 | ||||||||||||
Loans receivable including loans held for sale, net | 4,317,645 | 3,950,557 | 4,528,538 | 4,614,705 | ||||||||||||
Financial liabilities: | ||||||||||||||||
Deposits | $ | 3,926,368 | 3,926,382 | 3,953,405 | 3,967,256 | |||||||||||
Short term borrowings (1) | 279,726 | 279,777 | 159,905 | 159,905 | ||||||||||||
Advances from FHLB | 967,491 | 983,582 | 1,397,044 | 1,406,728 | ||||||||||||
Subordinated debentures, mortgage and notes payable | 287,772 | 266,651 | 26,683 | 26,746 | ||||||||||||
Junior subordinated debentures | 376,104 | 152,470 | 674,644 | 625,943 |
(1) | Short term borrowings includes federal funds purchased and other short term borrowings and securities sold under agreements to repurchase. |
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At December 31, 2008 and | ||||||||||||||||||||
For the Year Ended December 31, 2008 | ||||||||||||||||||||
BankAtlantic | ||||||||||||||||||||
(in thousands) | BFC | Bancorp | Woodbridge | Bluegreen | ||||||||||||||||
Shared service receivable (payable) | (a | ) | $ | 398 | (175 | ) | (115 | ) | (108 | ) | ||||||||||
Shared service income (expense) | (a | ) | $ | 3,157 | (1,593 | ) | (1,135 | ) | (429 | ) | ||||||||||
Facilities cost | (a | ) | $ | (245 | ) | 271 | (101 | ) | 75 | |||||||||||
Interest income (expense) from cash balance/securities sold under agreements to repurchase | (b | ) | $ | 8 | (80 | ) | 72 | — | ||||||||||||
Cash and cash equivalents and (securities sold under agreements to repurchase) | (b | ) | $ | 263 | (4,696 | ) | 4,433 | — |
At December 31, 2007 and | ||||||||||||||||||||
For the Year Ended December 31, 2007 | ||||||||||||||||||||
BankAtlantic | ||||||||||||||||||||
(in thousands) | BFC | Bancorp | Woodbridge | Bluegreen | ||||||||||||||||
Shared service receivable (payable) | (a | ) | $ | 312 | (89 | ) | (119 | ) | (104 | ) | ||||||||||
Shared service income (expense) | (a | ) | $ | 2,855 | (1,406 | ) | (1,006 | ) | (443 | ) | ||||||||||
Facilities cost | (a | ) | $ | (272 | ) | 220 | — | 52 | ||||||||||||
Interest income (expense) from cash balance/securities sold under agreements to repurchase | (b | ) | $ | 38 | (185 | ) | 147 | — | ||||||||||||
Cash and cash equivalents and (securities sold under agreements to repurchase) | (b | ) | $ | 1,217 | (7,335 | ) | 6,118 | — |
At December 31, 2006 and | ||||||||||||||||||||
For the Year Ended December 31, 2006 | ||||||||||||||||||||
BankAtlantic | ||||||||||||||||||||
(in thousands) | BFC | Bancorp | Woodbridge | Bluegreen | ||||||||||||||||
Shared service receivable (payable) | (a | ) | $ | 312 | (142 | ) | (107 | ) | (63 | ) | ||||||||||
Shared service income (expense) | (a | ) | $ | 2,495 | (1,053 | ) | (1,134 | ) | (308 | ) | ||||||||||
Office facilities cost | (a | ) | $ | (460 | ) | 406 | — | 54 | ||||||||||||
Interest income (expense) from cash balance/securities sold under agreements to repurchase | (b | ) | $ | 43 | (479 | ) | 436 | — | ||||||||||||
Cash and cash equivalents and (securities sold under agreements to repurchase) | (b | ) | $ | 996 | (5,547 | ) | 4,551 | — |
(a) | Pursuant to the terms of shared service agreements between BFC, BankAtlantic Bancorp and Woodbridge, subsidiaries of BFC provide shared service operations in the areas of human resources, risk management, investor relations, executive office administration and other services to BankAtlantic Bancorp and Woodbridge. Additionally, BFC provides certain risk management and administrative services to Bluegreen. The costs of shared services are allocated based upon the usage of the respective services. Also, as part of the shared service arrangement, the Company pays BankAtlantic Bancorp and Bluegreen for office facilities costs relating to the Company and its shared service operations. | |
In May 2008, BFC and BFC Shared Service Corporation (“BFC Shared Service”), a wholly-owned subsidiary of BFC, entered into office lease agreements with BankAtlantic under which BFC and BFC Shared Service pay BankAtlantic an annual rent of approximately $294,000 for office space in BankAtlantic’s corporate headquarters. In May 2008, BFC also entered into an office sub-lease agreement with Woodbridge for office space in BankAtlantic’s corporate headquarters pursuant to which Woodbridge will pay BFC an annual rent of approximately $152,000. | ||
(b) | BFC and Woodbridge entered into securities sold under agreements to repurchase transactions with BankAtlantic in the aggregate of approximately $4.7 million, $7.3 million and $5.5 million at December 31, 2008, 2007 and 2006, respectively. Interest was recognized in connection with the above was approximately $80,000, $185,000 and $479,000 for the years ended December 31, 2008, 2007 and 2006, respectively. These transactions have similar terms as BankAtlantic agreements with unaffiliated parties. Additionally, at December 31, 2008, BankAtlantic facilitated the placement of $49.9 million of FDIC insured certificates of deposits with other insured depository institutions on Woodbridge’s behalf through the Certificate of Deposit Account Registry Service (“CDARS”) program. The CDARS program facilitates the placement of funds into certificates of deposits issued by other financial institutions in increments of less than the standard FDIC insurance maximum to insure that both principal and interest are eligible for full FDIC insurance coverage |
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Class A | Weighted | |||||||
Common | Average | |||||||
Stock | Price | |||||||
Options outstanding | 53,789 | $ | 48.46 | |||||
Options non-vested | 13,610 | $ | 92.85 |
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For the Years Ended December 31, | ||||||||||||
(In thousands, except per share data) | 2008 | 2007 | 2006 | |||||||||
Basic (loss) earnings per share | ||||||||||||
Numerator: | ||||||||||||
Loss from continuing operations allocable to common stock | $ | (73,255 | ) | (34,650 | ) | (1,447 | ) | |||||
Discontinued operations, net of taxes | 4,461 | 1,038 | (1,524 | ) | ||||||||
Extraordinary gain, net of taxes | 9,145 | 2,403 | — | |||||||||
Net loss allocable to common shareholders | $ | (59,649 | ) | (31,209 | ) | (2,971 | ) | |||||
Denominator: | ||||||||||||
Basic weighted average number of common shares outstanding | 45,097 | 38,778 | 33,249 | |||||||||
Basic (loss) earnings per share: | ||||||||||||
Loss per share from continuing operations | $ | (1.62 | ) | (0.90 | ) | (0.04 | ) | |||||
Earnings (loss) per share from discontinued operations | 0.10 | 0.03 | (0.05 | ) | ||||||||
Earnings per share from extraordinary gain | 0.20 | 0.06 | — | |||||||||
Basic loss per share | $ | (1.32 | ) | (0.81 | ) | (0.09 | ) | |||||
Diluted (loss) earnings per share | ||||||||||||
Numerator | ||||||||||||
Loss from continuing operations allocable to common stock | $ | (73,255 | ) | (34,650 | ) | (1,447 | ) | |||||
Effect of securities issuable by subsidiaries | — | — | (93 | ) | ||||||||
Loss allocable to common stock after assumed dilution | $ | (73,255 | ) | (34,650 | ) | (1,540 | ) | |||||
Discontinued operations, net of taxes | $ | 4,461 | 1,038 | (1,524 | ) | |||||||
Extraordinary gain, net of taxes | $ | 9,145 | 2,403 | — | ||||||||
Net loss allocable to common stock after assumed dilution | $ | (59,649 | ) | (31,209 | ) | (3,064 | ) | |||||
Denominator | ||||||||||||
Diluted weighted average shares outstanding | 45,097 | 38,778 | 33,249 | |||||||||
Diluted (loss) earnings per share | ||||||||||||
Loss per share from continuing operations | $ | (1.62 | ) | (0.90 | ) | (0.05 | ) | |||||
Earnings (loss) per share from discontinued operations | 0.10 | 0.03 | (0.05 | ) | ||||||||
Earnings per share from extraordinary gain | 0.20 | 0.06 | — | |||||||||
Diluted loss per share | $ | (1.32 | ) | (0.81 | ) | (0.10 | ) | |||||
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First | Second | Third | Fourth | |||||||||||||||||
2008 | Quarter | Quarter | Quarter | Quarter | Total | |||||||||||||||
Revenues | $ | 119,415 | 129,881 | 134,713 | 103,461 | 487,470 | ||||||||||||||
Costs and expenses | 173,269 | 173,392 | 158,536 | 214,663 | 719,860 | |||||||||||||||
(53,854 | ) | (43,511 | ) | (23,823 | ) | (111,202 | ) | (232,390 | ) | |||||||||||
Equity in earnings from unconsolidated affiliates | 1,803 | 1,443 | 7,178 | 4,640 | 15,064 | |||||||||||||||
Impairment of unconsolidated affiliates | — | — | (53,583 | ) | (42,996 | ) | (96,579 | ) | ||||||||||||
Impairment of investments | — | — | — | (15,548 | ) | (15,548 | ) | |||||||||||||
Loss from continuing operations before income taxes and noncontrolling interest | (52,051 | ) | (42,068 | ) | (70,228 | ) | (165,106 | ) | (329,453 | ) | ||||||||||
(Benefit) provision for income taxes | (18,953 | ) | (15,326 | ) | (12,401 | ) | 62,443 | 15,763 | ||||||||||||
Noncontrolling interest | (27,065 | ) | (21,826 | ) | (52,453 | ) | (171,367 | ) | (272,711 | ) | ||||||||||
Loss from continuing operations | (6,033 | ) | (4,916 | ) | (5,374 | ) | (56,182 | ) | (72,505 | ) | ||||||||||
Discontinued operations, less noncontrolling interest and income tax | 162 | — | 1,438 | 2,861 | 4,461 | |||||||||||||||
Extraordinary gain | — | — | 9,145 | — | 9,145 | |||||||||||||||
Net (loss) income | (5,871 | ) | (4,916 | ) | 5,209 | (53,321 | ) | (58,899 | ) | |||||||||||
5% Preferred Stock dividends | (188 | ) | (187 | ) | (187 | ) | (188 | ) | (750 | ) | ||||||||||
Net (loss) income allocable to common shareholders | $ | (6,059 | ) | (5,103 | ) | 5,022 | (53,509 | ) | (59,649 | ) | ||||||||||
Basic loss per share from continuing operations | $ | (0.13 | ) | (0.11 | ) | (0.12 | ) | (1.25 | ) | (1.62 | ) | |||||||||
Basic earnings per share from discontinued operations | — | — | 0.03 | 0.06 | 0.10 | |||||||||||||||
Basic earnings per share from extraordinary gain | — | — | 0.20 | — | 0.20 | |||||||||||||||
Basic earnings (loss) per share | $ | (0.13 | ) | (0.11 | ) | 0.11 | (1.19 | ) | (1.32 | ) | ||||||||||
Diluted loss per share from continuing operations | $ | (0.13 | ) | (0.11 | ) | (0.12 | ) | (1.25 | ) | (1.62 | ) | |||||||||
Diluted earnings per share from discontinued operations | — | — | 0.03 | 0.06 | 0.10 | |||||||||||||||
Diluted earnings per share from extraordinary gain | — | — | 0.20 | — | 0.20 | |||||||||||||||
Diluted earnings (loss) per share | $ | (0.13 | ) | (0.11 | ) | 0.11 | (1.19 | ) | (1.32 | ) | ||||||||||
Basic weighted average number of common shares outstanding | 45,103 | 45,112 | 45,102 | 45,069 | 45,097 | |||||||||||||||
Diluted weighted average number of common shares outstanding | 45,103 | 45,112 | 45,102 | 45,069 | 45,097 | |||||||||||||||
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First | Second | Third | Fourth | |||||||||||||||||
2007 | Quarter | Quarter | Quarter | Quarter | Total | |||||||||||||||
Revenues | $ | 276,525 | 272,543 | 261,012 | 148,487 | 958,567 | ||||||||||||||
Costs and expenses | 282,231 | 334,549 | 493,490 | 182,098 | 1,292,368 | |||||||||||||||
(5,706 | ) | (62,006 | ) | (232,478 | ) | (33,611 | ) | (333,801 | ) | |||||||||||
Equity in earnings from unconsolidated affiliates | 2,893 | 2,026 | 4,763 | 3,042 | 12,724 | |||||||||||||||
Loss from continuing operations before income taxes and noncontrolling interest | (2,813 | ) | (59,980 | ) | (227,715 | ) | (30,569 | ) | (321,077 | ) | ||||||||||
Benefit for income taxes | (272 | ) | (17,774 | ) | (38,757 | ) | (12,209 | ) | (69,012 | ) | ||||||||||
Noncontrolling interest | (915 | ) | (39,307 | ) | (163,711 | ) | (14,232 | ) | (218,165 | ) | ||||||||||
Loss from continuing operations | (1,626 | ) | (2,899 | ) | (25,247 | ) | (4,128 | ) | (33,900 | ) | ||||||||||
Discontinued operations, less noncontrolling interest and income tax | 1,053 | (15 | ) | — | — | 1,038 | ||||||||||||||
Extraordinary gain | — | — | — | 2,403 | 2,403 | |||||||||||||||
Net loss | (573 | ) | (2,914 | ) | (25,247 | ) | (1,725 | ) | (30,459 | ) | ||||||||||
5% Preferred Stock dividends | (188 | ) | (187 | ) | (187 | ) | (188 | ) | (750 | ) | ||||||||||
Net loss allocable to common shareholders | $ | (761 | ) | (3,101 | ) | (25,434 | ) | (1,913 | ) | (31,209 | ) | |||||||||
Basic loss per share from continuing operations | $ | (0.05 | ) | (0.09 | ) | (0.59 | ) | (0.10 | ) | (0.90 | ) | |||||||||
Basic earnings per share from discontinued operations | 0.03 | — | — | — | 0.03 | |||||||||||||||
Basic earnings per share from extraordinary gain | — | — | — | 0.05 | 0.06 | |||||||||||||||
Basic earnings (loss) per share | $ | (0.02 | ) | (0.09 | ) | (0.59 | ) | (0.05 | ) | (0.81 | ) | |||||||||
Diluted loss per share from continuing operations | $ | (0.05 | ) | (0.09 | ) | (0.60 | ) | (0.10 | ) | (0.90 | ) | |||||||||
Diluted earnings per share from discontinued operations | 0.03 | — | — | — | 0.03 | |||||||||||||||
Diluted earnings per share from extraordinary gain | — | — | — | 0.05 | 0.06 | |||||||||||||||
Diluted earnings (loss) per share | $ | (0.02 | ) | (0.09 | ) | (0.60 | ) | (0.05 | ) | (0.81 | ) | |||||||||
Basic weighted average number of common shares outstanding | 33,444 | 33,451 | 42,942 | 45,096 | 38,778 | |||||||||||||||
Diluted weighted average number of common shares outstanding | 33,444 | 33,451 | 42,942 | 45,096 | 38,778 | |||||||||||||||
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Notes to Consolidated Financial Statements
November 9, | ||||
2007 | ||||
Cash | $ | 6,387 | ||
Inventory | 356,294 | |||
Property and equipment | 1,681 | |||
Other assets | 8,974 | |||
Assets deconsolidated | 373,336 | |||
Accounts payable and other accrued liabilities | 50,709 | |||
Customer deposits | 18,007 | |||
Notes and mortgage payable | 344,052 | |||
Due to Woodbridge | 67,831 | |||
Liabilities deconsolidated | $ | 480,599 | ||
Net equity/negative investment | $ | (107,263 | ) | |
The loss in excess of investment in subsidiary is comprised of: | ||||
Net equity/negative investment | (107,263 | ) | ||
Due to Woodbridge | 67,831 | |||
Deferred revenue (a) | (15,780 | ) | ||
$ | (55,212 | ) | ||
(a) | During the fourth quarter of 2008, deferred revenue was adjusted by $2.3 million due to a reclassification on intercompany land sales between Core and Carolina Oak that had been inadvertently recorded against the negative investment. As a result of this reclassification the net negative investment was reduced from $55.2 million to $52.9 million as of December 31, 2008. |
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Notes to Consolidated Financial Statements
Condensed Consolidated Statements of Financial Condition
As of December 31, 2008 and 2007
(In thousands)
2008 | 2007 | |||||||
Assets | ||||||||
Cash | $ | 4,712 | 5,365 | |||||
Restricted cash | 885 | — | ||||||
Inventory | 166,358 | 208,686 | ||||||
Property and equipment | — | 55 | ||||||
Other assets | 19,657 | 23,810 | ||||||
Total assets | $ | 191,612 | 237,916 | |||||
Liabilities and Shareholders’ Equity | ||||||||
Accounts payable and other accrued liabilities | $ | 719 | 469 | |||||
Due to Woodbridge | 2,870 | 748 | ||||||
Liabilities subject to compromise (A) | 327,707 | 354,748 | ||||||
Shareholders’ deficit | $ | (139,684 | ) | (118,049 | ) | |||
Total liabilities and shareholders’ equity | $ | 191,612 | 237,916 | |||||
Accounts payable and other accrued liabilities | $ | 54,954 | ||
Customer deposits | 15,754 | |||
Due to Woodbridge | 87,182 | |||
Deficiency claim associated with secured debt | 45,458 | |||
Notes and mortgage payable | 124,359 | |||
Total liabilities subject to compromise | $ | 327,707 | ||
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Notes to Consolidated Financial Statements
Condensed Consolidated Statements of Operations
Years Ended December 31, 2008, 2007 and 2006
(In thousands)
2008 | 2007 | 2006 | ||||||||||
Revenues | ||||||||||||
Sales of real estate | $ | 32,505 | 397,561 | 500,719 | ||||||||
Other revenues | 2 | 2,245 | 4,070 | |||||||||
Total revenues | 32,507 | 399,806 | 504,789 | |||||||||
Costs and expenses | ||||||||||||
Cost of sales of real estate | 42,864 | 562,763 | 440,059 | |||||||||
Selling, general and administrative expenses | 4,340 | 70,848 | 77,858 | |||||||||
Total costs and expenses | 47,204 | 633,611 | 517,917 | |||||||||
Bankruptcy related items, net | (7,049 | ) | (3,525 | ) | — | |||||||
Other income, net of interest and other expense | 111 | (1,928 | ) | (560 | ) | |||||||
Loss before income taxes | (21,635 | ) | (239,258 | ) | (13,688 | ) | ||||||
(Provision) benefit for income taxes | — | (303 | ) | 4,749 | ||||||||
Net loss | $ | (21,635 | ) | (239,561 | ) | (8,939 | ) | |||||
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Notes to Consolidated Financial Statements
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AND FINANCIAL DISCLOSURE
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Alan B. Levan
Chief Executive Officer
March 31, 2009
John K. Grelle
Chief Financial Officer
March 31, 2009
Maria R. Scheker
Chief Accounting Officer
March 31, 2009
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(a) | Documents Filed as Part of this Report: |
(1) | Financial Statements | ||
The following consolidated financial statements of BFC Financial Corporation and its subsidiaries are included herein under Part II, Item 8 of this Report. |
Report of Independent Registered Certified Public Accounting Firm of PricewaterhouseCoopers LLP dated March 31, 2009. | |||
Consolidated Statements of Financial Condition as of December 31, 2008 and 2007. | |||
Consolidated Statements of Operations for each of the years in the three year period ended December 31, 2008. | |||
Consolidated Statements of Comprehensive Loss for each of the years in the three year period ended December 31, 2008. | |||
Consolidated Statements of Shareholders’ Equity for each of the years in the three year period ended December 31, 2008. | |||
Consolidated Statements of Cash Flows for each of the years in the three year period ended December 31, 2008. | |||
Notes to Consolidated Financial Statements |
(2) | Financial Statement Schedules | ||
Audited Financial Statements of Bluegreen Corporation for the three years ended December 31, 2008 (See Exhibit 99.1) | |||
Schedules not listed above are omitted as the required information is either not applicable or is presented in the financial statements or related notes. |
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(3) | Exhibits | |
The following exhibits are either filed as a part of or furnished with this report or are incorporated herein by reference to documents previously filed as indicated below: |
Exhibit | ||||
Number | Description | Reference | ||
3.1 | Articles of Incorporation, as amended and restated | Exhibit 3.1 of Registrant’s Registration Statement on Form 8-A filed October 16, 1997 | ||
3.2 | Amendment to Articles of Incorporation, as amended and restated | Exhibit 4 of Registrant’s Current Report on Form 8-K filed June 27, 2002 and Appendix A of Registrant’s Schedule 14C filed January 18, 2005 | ||
3.3 | Amended and Restated By-laws, as amended | Exhibit 3.3 to the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2007, filed on March 17, 2008 | ||
3.4 | Amendment to Articles of Incorporation, as amended and restated | Exhibit 3.1 of the Registrant’s Current Report on Form 8-K filed December 18, 2008. | ||
10.1 | BFC Financial Corporation 2005 Stock Incentive Plan | Appendix A to the Registrant’s Definitive Proxy Statement filed April 18, 2005 | ||
10.2 | Executive Services Agreement by and among BFC Financial Corporation and Tatum, LLC, dated as of December 5, 2007, relating to the employment of John K. Grelle | Exhibit 10.2 to the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2007, filed on March 17, 2008 | ||
12.1 | Ratio of earnings to fixed charges | Filed with this Report | ||
14.1 | Code of Business Conduct and Ethics | Exhibit 14.1 to the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2007, filed on March 17, 2008 | ||
21.1 | Subsidiaries of the registrant | Filed with this Report | ||
23.1 | Consent of PricewaterhouseCoopers LLP | Filed with this Report | ||
23.2 | Consent of Ernst & Young LLP | Filed with this Report | ||
31.1 | Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | Filed with this Report | ||
31.2 | Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | Filed with this Report | ||
31.3 | Certification of Chief Accounting Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | Filed with this Report | ||
32.1 | Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 | Furnished with this Report | ||
32.2 | Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 | Furnished with this Report | ||
32.3 | Certification of Chief Accounting Officer pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 | Furnished with this Report | ||
99.1 | Audited financial statements of Bluegreen Corporation for the three years ended December 31, 2008 | Filed with this Report |
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BFC FINANCIAL CORPORATION | ||||
March 31, 2009 | By: | /s/ Alan B. Levan | ||
Alan B. Levan, Chairman of the Board, | ||||
President and Chief Executive Officer | ||||
Signature | Title | Date | ||
/s/ Alan B. Levan | March 31, 2009 | |||
Alan B. Levan | Chairman of the Board, President and Chief Executive Officer | |||
/s/ John E. Abdo | March 31, 2009 | |||
John E. Abdo | Vice Chairman of the Board | |||
/s/ John K. Grelle | March 31, 2009 | |||
John K. Grelle | Chief Financial Officer | |||
/s/ Maria R. Scheker | March 31, 2009 | |||
Maria R. Scheker | Chief Accounting Officer | |||
/s/ D. Keith Cobb | March 31, 2009 | |||
D. Keith Cobb | Director | |||
/s/ Oscar J. Holzmann | March 31, 2009 | |||
Oscar J. Holzmann | Director | |||
/s/ Neil A. Sterling | March 31, 2009 | |||
Neil A. Sterling | Director |
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