Exhibit 99.1
For Information Contact | ||
At Greater Bay Bancorp: | At Silverman Heller Associates: | |
Byron A. Scordelis, President and CEO | Philip Bourdillon/Gene Heller | |
(650) 838-6101 | (310) 208-2550 | |
James S. Westfall, EVP and CFO | ||
(650) 838-6108 |
FOR IMMEDIATE RELEASE
GREATER BAY BANCORP REPORTS
FINANCIAL RESULTS
FORTHE THIRD QUARTEROF 2006
EAST PALO ALTO, Calif., October 30, 2006 – Greater Bay Bancorp (Nasdaq: GBBK), a $7.3 billion in assets financial services holding company, today announced results for the third quarter and nine months ended September 30, 2006.
For the third quarter of 2006, the Company’snet income was $18.5 million, or $0.32 per diluted common share, compared to $25.6 million, or $0.44 per diluted common share, for the third quarter of 2005, and $25.1 million, or $0.46 per diluted common share, for the second quarter of 2006. For the first nine months of 2006, net income was $69.5 million, or $1.24 per diluted common share, compared to $69.8 million, or $1.16 per diluted common share for the first nine months of 2005.
Operating results for the quarter reflected the recognition of approximately $7.0 million of notable expenses which included the following: $3.2 million of unamortized debt issuance costs that were written off in connection with the redemption of trust preferred securities in August 2006; $2.5 million in combined expenses related to the rebranding of regional banking identities, consulting costs related to the previously disclosed self-initiated review of historical stock option practices, and transitional costs related to the outsourcing of the Company’s mainframe data processing operations; and $1.3 million in costs at ABD related to severance and expenses associated with the opening of ABD’s new office in Oregon.
For the third quarter of 2006, the Company’sreturn on average common equity, annualized, was 10.15% compared to 15.13% for the third quarter of 2005, and 14.29% for the second quarter of 2006. Return on average common equity, annualized, for the first nine months of 2006 was 13.22% compared to 13.96% for the same period in 2005.Return on average assets, annualized, for the third quarter of 2006 was 1.00% compared to 1.41% for the third quarter of 2005, and 1.41% for the second quarter of 2006. Return on average assets, annualized, was 1.29% for the first nine months of 2006 compared to 1.32% for the same period in 2005.
“Our performance for the quarter was marked by the confluence of several non-core or otherwise notable expenses which impacted our bottom line results,” stated Byron A. Scordelis, President and Chief Executive Officer of Greater Bay Bancorp. “On a more sustained basis, we are pleased to note the continuation of both solid loan growth and exemplary credit quality during the most recent period. In the insurance brokerage area, organic revenue growth was
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once again favorable at ABD, and the Bank successfully completed the outsourcing of its mainframe operations which will contribute to our broader and ongoing cost reduction efforts in the future.”
“While period-end core deposit totals once again declined, effectively all of that reduction occurred in the volatile title company, venture capital, and 1031 exchange specialty deposit areas which extended a cyclical trend that has been evident for several quarters,” Mr. Scordelis continued. “With both the growth and quality of our loan portfolio well in hand, we are intently focused on operating expense containment as well as long term growth and value in our core deposit base as being key elements to drive our future earnings performance.”
Net Interest Income and Margin
Net interest income for the third quarter of 2006 decreased to $63.8 million from $68.0 million in the third quarter of 2005, and decreased from $65.8 million in the second quarter of 2006. Net interest income for the first nine months of 2006 decreased to $196.2 million from $199.5 million for the same period of 2005.
The net interest margin (on a fully tax-equivalent basis) for the third quarter of 2006 was 3.97%, compared to 4.32% for the third quarter of 2005 and 4.26% for the second quarter of 2006. The net interest margin (on a fully tax equivalent basis) for the first nine months of 2006 was 4.20% compared to 4.34% for the same period in 2005.
“About half of the third quarter reduction in net interest margin resulted from the combined effect of continued loan growth, core deposit attrition, and upward pressure on core deposit costs,” stated James Westfall, Executive Vice President and Chief Financial Officer. “The remaining change largely resulted from growth in our investment portfolio, a period-to-period decline in deferred interest recognition and prepayment fees, and a temporary increase in cash and cash equivalents. We currently anticipate that our margin for the fourth quarter will remain stabilized at or near third quarter levels which has been reflected in our revised margin outlook for the full year,” he concluded.
Non-Interest Income
Non-interest income for the third quarter of 2006 increased to $55.5 million compared to $54.5 million in the third quarter of 2005. This change was primarily attributable to a $1.8 million increase in insurance brokerage commissions and fees.
Non-interest income for the third quarter of 2006 decreased by $1.3 million compared to the second quarter of 2006. This reduction was primarily attributable to a $3.6 million reduction in warrant portfolio income, partially offset by a $1.5 million increase in insurance commissions and fees.
Non-interest income for the first nine months of 2006 increased to $172.3 million from $158.9 million for the same period of 2005. This change was primarily attributable to an increase in insurance brokerage commissions and fees of $9.6 million and an increase in other income of $3.6 million including $3.9 million of warrant portfolio appreciation.
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Non-interest income as a percentage of total revenues for the third quarter of 2006 was 46.5%, compared to 44.5% for the third quarter of 2005 and 46.3% for the second quarter of 2006. Non-interest income as a percentage of total revenues for the first nine months of 2006 was 46.7%, compared to 44.3% for the same period one year ago.
“We are encouraged by the continued revenue growth being achieved by ABD in the face of ongoing pressures on premium levels in the property and casualty and workers’ compensation areas,” commented Mr. Scordelis. “Of equal significance, ABD entered the Oregon market by opening a new office in Eugene during the quarter, continuing ABD’s progress in implementing its strategic objective of achieving a preeminent presence and share position on the West Coast.”
Operating Expenses
Operating expenses for the third quarter of 2006 increased to $91.1 million from $84.6 million in the third quarter of 2005. Operating expenses for the third quarter of 2006 increased to $91.1 million from $84.5 million in the second quarter of 2006. This expense growth was primarily attributable to the following:
• | Write-off of $3.2 million in unamortized debt issuance costs associated with the redemption of trust preferred securities, |
• | Combined costs of $2.5 million associated with the rebranding of banking identities, consulting costs related to the previously disclosed self-initiated review of historical stock option practices, and outsourcing of the Company’s mainframe computer operations, and |
• | Costs of $1.3 million at ABD related to severance and expenses associated with the opening of its new office in Oregon. |
Operating expenses for the first nine months of 2006 increased to $267.7 million from $249.7 million for the first nine months of 2005. In addition to the items noted above, expense growth during this period was also attributable to:
• | Expenses of $10.2 million representing the full year impact in 2006 of expenses resulting from the Lucini/Parish acquisition in May 2005 and ABD’s opening of new office locations in San Diego and Denver, and |
• | Expenses of $2.3 million due to accelerated vesting of restricted stock and adoption of FAS 123R. |
“In the current cyclical period of margin and revenue pressure, cost rationalization is clearly of increased importance. As a result of focused expense reduction initiatives currently underway, we fully expect total normalized core operating expenses to decrease in 2007 from actual 2006 levels,” stated Mr. Scordelis.
Credit Quality Overview
Net loan charge-offs in the third quarter of 2006 were $0.2 million, or 0.02% of average loans, annualized, compared to $3.1 million, or 0.26% of average loans, for the third quarter of 2005 and $2.7 million, or 0.23% of average loans, for the second quarter of 2006. Net loan charge-offs for the first nine months of 2006 were $2.9 million, or 0.08% of average loans, annualized, compared to $10.1 million or 0.29% for the same period in 2005.
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Provision for credit losses was a negative provision of $0.4 million for the third quarter of 2006, compared to a negative provision of $3.4 million for the third quarter of 2005, and a negative provision of $1.9 million for the second quarter of 2006. The provision for the first nine months of 2006 was a negative $8.3 million, compared to a negative $2.8 million for the first nine months of 2005.
Non-performing assets were $29.7 million at September 30, 2006, compared to $73.1 million at September 30, 2005 and $32.6 million at June 30, 2006. The ratio of non-performing assets to total assets was 0.40% at September 30, 2006, compared to 1.03% at September 30, 2005 and 0.44% at June 30, 2006. The ratio of non-accrual loans to total loans was 0.60% at September 30, 2006, compared to 1.53% at September 30, 2005 and 0.68% at June 30, 2006.
Allowance for loan and lease losses was $71.3 million, or 1.48% of total loans at September 30, 2006, compared to $92.9 million, or 1.98% of total loans, at September 30, 2005 and $71.7 million, or 1.50% of total loans, at June 30, 2006.
“We continue to be pleased with the quality of our credit portfolio,” commented Mr. Scordelis. “Non-performing loan levels continued their downward trend, and now stand fully sixty percent below the dollar level of one year ago. Net charge-offs were also extremely well contained. An assessment of these and other key credit metrics gave rise to our decision to favorably adjust our guidance in this area for the full year of 2006,” he concluded.
Balance Sheet
At September 30, 2006, total assets were $7.3 billion, total net loans were $4.8 billion, total securities were $1.6 billion, and total deposits were $5.1 billion.
Total loans net of deferred costs and fees increased by $149.6 million from September 30, 2005 to September 30, 2006. This growth reflects increases of $143.4 million in real estate construction and land loans, and $131.0 million in commercial loans. These increases were partially offset by decreases of $70.1 million in the commercial term real estate loan portfolio, $38.6 million in real estate other and $36.9 million in consumer and other loans.
Total loans net of deferred costs and fees increased by $61.7 million from June 30, 2006 to September 30, 2006, representing an annualized growth rate of 5.12% for the quarter. This growth reflects an increase of $63.9 in commercial loans and $22.0 million in commercial term real estate loans, partially offset by decreases of $22.7 million in consumer and other loans and $9.0 million in construction and land loans.
“We are pleased with our fourth consecutive quarter of core loan expansion, particularly since this growth was once again concentrated in the targeted area of commercial lending. With our specialty finance business activity remaining strong and our community banking business posting tangible growth during the period, we continue to track to the expectations reflected in our existing guidance,” indicated Mr. Scordelis.
Securities totaled $1.6 billion as of September 30, 2006, compared to $1.5 billion at September 30, 2005 and $1.6 billion at June 30, 2006.
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Core deposits (excluding institutional and brokered deposits) at September 30, 2006 decreased by $479.8 million compared to September 30, 2005 and decreased by $154.6 million compared to June 30, 2006.
According to Mr. Scordelis, “While core deposit levels continue to be affected by the volatility of large specialty accounts and upward pressure on core deposit costs, we are encouraged that money market account totals in our community banking area remained virtually flat during the quarter. Given this overall challenging environment, we have redoubled our focus on steps aimed at ensuring the restoration of well-priced growth in our deposit portfolio,” he added.
Capital Overview
The capital ratios of Greater Bay Bancorp and its subsidiary bank continue to exceed minimum well-capitalized guidelines established by bank regulatory agencies.
The Company’s common equity to assets ratio was 10.01% at September 30, 2006, compared to 9.43% at September 30, 2005 and 9.66% at June 30, 2006. The Company’s tangible common equity to tangible assets ratio was 6.34% at September 30, 2006, compared to 5.58% at September 30, 2005 and 5.96% at June 30, 2006.
Other Matters
In September 2006, the SEC staff issued Staff Accounting Bulletin No. 108, “Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements”(SAB 108).The Company will adopt SAB 108 as of December 31, 2006 and initially apply its provisions using the cumulative effect transition method in connection with the preparation of its annual financial statements for the year ending December 31, 2006.
Upon adoption of SAB 108, the Company expects to increase net income for the year ending December 31, 2006 by approximately $1.3 million and, as of January 1, 2006, record an increase to common stock of approximately $3.4 million and a reduction in retained earnings of approximately $4.7 million. The increase in net income results from the reversal of entries recorded during the first and second quarters of 2006 to correct immaterial errors related to periods prior to 2006. The increase in common stock relates to previously uncorrected errors in recording tax benefits arising from stock option tax deductions during the years 1996 through 2005.
Outlook for 2006
Our full year guidance for 2006 has been updated as follows:
• | Core Loan Growth – based on the current forecast of moderate economic growth in our primary market area, we anticipate core loan portfolio growth in the mid to high single digit range. |
• | Core Deposit Growth – we do not currently contemplate a near-term recovery of the core deposit outflow experienced in the first nine months of 2006, and now expect core deposit totals to remain flat for the balance of the year relative to the quarter end balance at September 30, 2006. |
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• | Credit Quality –based on our continued credit risk management and the current economic outlook, we anticipate full year net charge-offs to range from 12 basis points to 15 basis points of average loans outstanding. |
• | Net Interest Margin – based on the Company’s anticipated core loan growth and core deposit stability and its neutral interest rate sensitivity position, we expect the full year margin level to fluctuate in the 4.10% to 4.15% range. |
Conference Call
The Company will broadcast its earnings conference call live via the Internet at 8:00 a.m. (PST) on Monday, October 30, 2006. Participants may access this conference call through the Company’s website athttp://www.gbbk.com, under the “Investor Info” link, or throughhttp://www.earnings.com. You should go to either of these websites 15 minutes prior to the start of the call, as it may be necessary to download audio software to hear the conference call.
A replay of the conference call will be available on the websites. A telephone replay will also be available beginning at 11:00 a.m. PST on October 30, 2006 through 9:00 p.m. PST on November 6, 2006, by dialing 800-642-1687 or 706-645-9291 and providing Conference ID 9745265.
About Greater Bay Bancorp
Greater Bay Bancorp, a diversified financial services holding company, provides community banking services in the Greater San Francisco Bay Area through Greater Bay Bank, N.A.’s community banking organization, including Bank of Petaluma, Coast Commercial Bank, Golden Gate Bank, Mid-Peninsula Bank, Mt. Diablo National Bank, Peninsula Bank of Commerce and Santa Clara Valley National Bank. Nationally, Greater Bay Bancorp provides specialized leasing and loan services through its specialty finance group, which includes Matsco, CAPCO and Greater Bay Capital. ABD Insurance and Financial Services, the Company’s insurance brokerage subsidiary, provides commercial insurance brokerage, employee benefits consulting and risk management solutions to business clients throughout the United States.
Safe Harbor
Certain matters discussed in this press release constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward looking statements relate to the Company’s current expectations regarding future operating results, net interest margin, net loan charge-offs, asset quality, level of loan loss reserves, growth in loans and deposits, the strength of the local economy and the Company’s intent to adopt SAB 108 as of December 31, 2006. These forward looking statements are subject to certain risks and uncertainties that could cause the actual results, performance or achievements to differ materially from those expressed, suggested or implied by the forward looking statements. These risks and uncertainties include, but are not limited to: (1) the impact of changes in interest rates, a decline in economic conditions at the local, national and international levels and increased competition among financial service providers on the Company’s results of operations and the quality of the Company’s earning assets; (2) government regulation, including ABD’s receipt of requests for information from state insurance commissioners and subpoenas from
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state attorneys general related to the ongoing insurance industry-wide investigations into contingent commissions and override payments; and (3) the other risks set forth in the Company’s reports filed with the Securities and Exchange Commission, including its Annual Report on Form 10-K for the year ended December 31, 2005. Greater Bay does not undertake, and specifically disclaims, any obligation to update any forward-looking statements to reflect occurrences or unanticipated events or circumstances after the date of such statements.
For additional information and press releases about Greater Bay Bancorp, visit the Company’s website athttp://www.gbbk.com.
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Greater Bay Bancorp Reports Financial Results for the Third Quarter of 2006
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GREATER BAY BANCORP
September 30, 2006 - FINANCIAL SUMMARY (UNAUDITED)
(Dollars and shares in 000’s, except per share data)
SELECTED QUARTERLY CONSOLIDATED OPERATING DATA:
Third Quarter 2006 | Second Quarter 2006 | First Quarter 2006 | Fourth Quarter 2005 | Third Quarter 2005 | ||||||||||||||||
Interest income | $ | 113,916 | $ | 108,321 | $ | 103,754 | $ | 102,225 | $ | 100,710 | ||||||||||
Interest expense | 50,142 | 42,487 | 37,134 | 34,478 | 32,714 | |||||||||||||||
Net interest income before (recovery of) / provision for credit losses | 63,774 | 65,834 | 66,620 | 67,747 | 67,996 | |||||||||||||||
(Recovery of) / provision for credit losses | (443 | ) | (1,886 | ) | (6,004 | ) | (10,491 | ) | (3,352 | ) | ||||||||||
Net interest income after (recovery of) / provision for credit losses | 64,217 | 67,720 | 72,624 | 78,238 | 71,348 | |||||||||||||||
Non-interest income: | ||||||||||||||||||||
Insurance commissions and fees | 41,757 | 40,235 | 44,969 | 37,071 | 39,974 | |||||||||||||||
Rental revenue on operating leases | 4,632 | 4,790 | 5,264 | 4,906 | 4,901 | |||||||||||||||
Service charges and other fees | 2,363 | 2,368 | 2,540 | 2,533 | 2,496 | |||||||||||||||
Loan and international banking fees | 1,960 | 1,718 | 1,795 | 1,919 | 1,663 | |||||||||||||||
Income on bank owned life insurance | 2,038 | 1,922 | 1,911 | 1,869 | 1,877 | |||||||||||||||
Trust fees | 1,059 | 1,127 | 1,055 | 1,101 | 1,074 | |||||||||||||||
Gains on sale of loans | (14 | ) | — | — | 172 | 100 | ||||||||||||||
Security gains, net | 40 | 5 | 168 | — | 43 | |||||||||||||||
Other income | 1,617 | 4,605 | 2,331 | 3,438 | 2,361 | |||||||||||||||
Total non-interest income | 55,452 | 56,770 | 60,033 | 53,009 | 54,489 | |||||||||||||||
Operating expenses: | ||||||||||||||||||||
Compensation and benefits | 52,548 | 51,500 | 57,929 | 51,455 | 50,745 | |||||||||||||||
Occupancy and equipment | 11,896 | 12,241 | 11,322 | 11,285 | 11,278 | |||||||||||||||
Legal costs and other professional fees | 5,074 | 3,884 | 3,753 | 5,295 | 4,671 | |||||||||||||||
Depreciation - operating leases | 3,665 | 3,917 | 4,091 | 4,013 | 4,108 | |||||||||||||||
Amortization of intangibles | 1,678 | 1,689 | 1,640 | 1,835 | 1,886 | |||||||||||||||
Other expenses | 16,220 | 11,255 | 13,379 | 12,476 | 11,936 | |||||||||||||||
Total operating expenses | 91,081 | 84,486 | 92,114 | 86,359 | 84,624 | |||||||||||||||
Income before provision for income taxes and cumulative effect of accounting change | 28,588 | 40,004 | 40,543 | 44,888 | 41,213 | |||||||||||||||
Provision for income taxes | 10,076 | 14,886 | 14,772 | 17,433 | 15,626 | |||||||||||||||
Income before cumulative effect of accounting change | 18,512 | 25,118 | 25,771 | 27,455 | 25,587 | |||||||||||||||
Cumulative effect of accounting change, net of tax (1) | — | — | 130 | — | — | |||||||||||||||
Net income | $ | 18,512 | $ | 25,118 | $ | 25,901 | $ | 27,455 | $ | 25,587 | ||||||||||
EARNINGS PER SHARE DATA: | ||||||||||||||||||||
Net Income per common share before cumulative effect of accounting change (2) | ||||||||||||||||||||
Basic | $ | 0.33 | $ | 0.46 | $ | 0.48 | $ | 0.51 | $ | 0.47 | ||||||||||
Diluted | $ | 0.32 | $ | 0.46 | $ | 0.46 | $ | 0.48 | $ | 0.44 | ||||||||||
Net Income per common share after cumulative effect of accounting change (2) | ||||||||||||||||||||
Basic | $ | 0.33 | $ | 0.46 | $ | 0.48 | $ | 0.51 | $ | 0.47 | ||||||||||
Diluted | $ | 0.32 | $ | 0.46 | $ | 0.46 | $ | 0.48 | $ | 0.44 | ||||||||||
Weighted average common shares outstanding | 50,423 | 50,188 | 49,802 | 50,251 | 50,698 | |||||||||||||||
Weighted average common & potential common shares outstanding | 51,366 | 51,173 | 52,727 | 53,370 | 54,010 | |||||||||||||||
GAAP ratios | ||||||||||||||||||||
Return on quarterly average assets, annualized | 1.00 | % | 1.41 | % | 1.47 | % | 1.53 | % | 1.41 | % | ||||||||||
Return on quarterly average common shareholders’ equity, annualized | 10.15 | % | 14.29 | % | 15.42 | % | 16.25 | % | 15.13 | % | ||||||||||
Return on quarterly average total equity, annualized | 8.89 | % | 12.47 | % | 13.39 | % | 14.09 | % | 13.12 | % | ||||||||||
Net interest margin, annualized (3) | 3.97 | % | 4.26 | % | 4.35 | % | 4.36 | % | 4.32 | % | ||||||||||
Operating expense ratio, annualized (4) | 4.92 | % | 4.75 | % | 5.24 | % | 4.81 | % | 4.67 | % | ||||||||||
Efficiency ratio (5) | 76.39 | % | 68.91 | % | 72.73 | % | 71.52 | % | 69.09 | % | ||||||||||
NON-GAAP ratios | ||||||||||||||||||||
Efficiency ratio (excluding ABD & other ABD expenses paid by holding company) (6) | 69.63 | % | 59.53 | % | 67.76 | % | 62.31 | % | 59.50 | % | ||||||||||
__________ (1) Effective January 1, 2006, the Company adopted SFAS No.123 (revised 2004), Share-Based Payment (“SFAS 123R”), as a result of which the Company recognized a one-time cumulative adjustment, to record an estimate of future forfeitures on outstanding equity based awards for which compensation expense had been recognized prior to adoption. |
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(2) The following table provides a reconciliation of income available to common shareholders before and after cumulative effect of accounting change. Additionally, the Company’s outstanding convertible preferred stock was antidilutive for all periods presented. |
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Income before cumulative effect of accounting change as reported | $ | 18,512 | $ | 25,118 | $ | 25,771 | $ | 27,455 | $ | 25,587 | ||||||||||
Less: dividends on convertible preferred stock | (1,832 | ) | (1,822 | ) | (1,832 | ) | (1,825 | ) | (1,834 | ) | ||||||||||
Income available to common shareholders before cumulative effect of accounting change | 16,680 | 23,296 | 23,939 | 25,630 | 23,753 | |||||||||||||||
Add: CODES interest and other related income/(loss), net of taxes | — | — | 59 | (99 | ) | 76 | ||||||||||||||
Income available to common shareholders before cumulative effect of accounting change | 16,680 | 23,296 | 23,998 | 25,531 | 23,829 | |||||||||||||||
Cumulative effect of accounting change, net of tax | — | — | 130 | — | — | |||||||||||||||
Income available to common shareholders after cumulative effect of accounting change | $ | 16,680 | $ | 23,296 | $ | 24,128 | $ | 25,531 | $ | 23,829 | ||||||||||
Weighted average common shares outstanding | 50,423 | 50,188 | 49,802 | 50,251 | 50,698 | |||||||||||||||
Weighted average potential common shares: | ||||||||||||||||||||
Stock options | 943 | 985 | 946 | 939 | 878 | |||||||||||||||
CODES due 2024 | — | — | 1,979 | 2,180 | 2,426 | |||||||||||||||
CODES due 2022 | — | — | — | — | 8 | |||||||||||||||
Total weighted average common & potential common shares outstanding | 51,366 | 51,173 | 52,727 | 53,370 | 54,010 | |||||||||||||||
(3) Net interest income (on a tax equivalent basis) for the period, annualized and divided by average quarterly interest earning assets for the period. |
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(4) Total operating expenses for the period, annualized and divided by average quarterly assets. |
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(5) Total operating expenses divided by total revenue (the sum of net interest income and non-interest income, excluding provision for credit losses). |
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(6) Total operating expenses less ABD operating expenses divided by total revenue less ABD revenue. The following table provides the information for calculating the efficiency ratio excluding ABD: |
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Revenue (excluding ABD) | $ | 77,083 | $ | 82,180 | $ | 81,183 | $ | 83,614 | $ | 81,796 | ||||||||||
Operating expenses (excluding ABD & other ABD expenses paid by holding company) | $ | 53,670 | $ | 48,922 | $ | 55,010 | $ | 52,102 | $ | 48,667 |
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GREATER BAY BANCORP
September 30, 2006 - FINANCIAL SUMMARY (UNAUDITED)
(Dollars and shares in 000’s, except per share data)
SELECTED QUARTERLY CONSOLIDATED OPERATING DATA:
Nine Months Ended September 30, | ||||||||
2006 | 2005 | |||||||
Interest income | $ | 325,991 | $ | 288,558 | ||||
Interest expense | 129,763 | 89,095 | ||||||
Net interest income before (recovery of) / provision for credit losses | 196,228 | 199,463 | ||||||
(Recovery of) / provision for credit losses | (8,333 | ) | (2,778 | ) | ||||
Net interest income after (recovery of) / provision for credit losses | 204,561 | 202,241 | ||||||
Non-interest income: | ||||||||
Insurance commissions and fees | 126,961 | 117,319 | ||||||
Rental revenue on operating leases | 14,686 | 13,396 | ||||||
Service charges and other fees | 7,271 | 7,915 | ||||||
Loan and international banking fees | 5,473 | 5,789 | ||||||
Income on bank owned life insurance | 5,871 | 5,679 | ||||||
Trust fees | 3,241 | 3,200 | ||||||
Gains on sale of loans | (14 | ) | 306 | |||||
Security gains, net | 213 | 342 | ||||||
Other income | 8,553 | 4,977 | ||||||
Total non-interest income | 172,255 | 158,923 | ||||||
Operating expenses: | ||||||||
Compensation and benefits | 161,977 | 149,202 | ||||||
Occupancy and equipment | 35,459 | 32,838 | ||||||
Legal costs and other professional fees | 12,711 | 12,720 | ||||||
Depreciation - operating leases | 11,673 | 11,213 | ||||||
Amortization of intangibles | 5,007 | 6,041 | ||||||
Other expenses | 40,854 | 37,688 | ||||||
Total operating expenses | 267,681 | 249,702 | ||||||
Income before provision for income taxes and cumulative effect of accounting change | 109,135 | 111,462 | ||||||
Provision for income taxes | 39,734 | 41,690 | ||||||
Income before cumulative effect of accounting change | 69,401 | 69,772 | ||||||
Cumulative effect of accounting change, net of tax (1) | 130 | — | ||||||
Net income | $ | 69,531 | $ | 69,772 | ||||
EARNINGS PER SHARE DATA: | ||||||||
Net Income per common share before cumulative effect of accounting change (2) | ||||||||
Basic | $ | 1.27 | $ | 1.26 | ||||
Diluted | $ | 1.24 | $ | 1.16 | ||||
Net Income per common share after cumulative effect of accounting change (2) | ||||||||
Basic | $ | 1.28 | $ | 1.26 | ||||
Diluted | $ | 1.24 | $ | 1.16 | ||||
Weighted average common shares outstanding | 50,159 | 50,891 | ||||||
Weighted average common & potential common shares outstanding | 51,536 | 55,824 | ||||||
GAAP ratios | ||||||||
Return on YTD average assets, annualized | 1.29 | % | 1.32 | % | ||||
Return on YTD common shareholders’ equity, annualized | 13.22 | % | 13.96 | % | ||||
Return on YTD average total equity, annualized | 11.53 | % | 12.09 | % | ||||
Net interest margin, annualized (3) | 4.20 | % | 4.34 | % | ||||
Operating expense ratio, annualized (4) | 4.97 | % | 4.72 | % | ||||
Efficiency ratio (5) | 72.64 | % | 69.67 | % | ||||
NON-GAAP ratios | ||||||||
Efficiency Ratio (excluding ABD & other ABD expenses paid by holding company) (6) | 65.55 | % | 62.53 | % | ||||
___________ (1) Effective January 1, 2006, the Company adopted SFAS No.123 (revised 2004), Share-Based Payment (“SFAS 123R”), as a result of which the Company recognized a one-time which the Company recognized a one-time cumulative adjustment, to record an estimate of future forfeitures on outstanding equity based awards for which compensation expense had been recognized prior to adoption. |
| |||||||
(2) The following table provides a reconciliation of income available to common shareholders before and after cumulative effect of accounting change. Additionally, the Company’s outstanding convertible preferred stock was antidilutive for all periods presented. |
| |||||||
Income before cumulative effect of accounting change as reported | $ | 69,401 | $ | 69,772 | ||||
Less: dividends on convertible preferred stock | (5,486 | ) | (5,515 | ) | ||||
Net Income available to common shareholders before cumulative effect of accounting change | 63,915 | 64,257 | ||||||
Add: CODES interest and other related income/(loss), net of taxes | 59 | 366 | ||||||
Income available to common shareholders before cumulative effect of accounting change | 63,974 | 64,623 | ||||||
Cumulative effect of accounting change, net of tax | 130 | — | ||||||
Income available to common shareholders after cumulative effect of accounting change | $ | 64,104 | $ | 64,623 | ||||
Weighted average common shares outstanding | 50,159 | 50,891 | ||||||
Weighted average potential common shares: | ||||||||
Stock options | 725 | 927 | ||||||
CODES due 2024 | 652 | 3,993 | ||||||
CODES due 2022 | — | 13 | ||||||
Total weighted average common & potential common shares outstanding | 51,536 | 55,824 | ||||||
(3) Net interest income (on a tax equivalent basis) for the period, annualized and divided by average quarterly interest earning assets for the period. |
| |||||||
(4) Total operating expenses for the period, annualized and divided by average quarterly assets. |
| |||||||
(5) Total operating expenses divided by total revenue (the sum of net interest income and non-interest income, excluding provision for credit losses). |
| |||||||
(6) Total operating expenses less ABD operating expenses divided by total revenue less ABD revenue. The following information is for calculating the efficiency ratio excluding ABD: |
| |||||||
Revenue (Excluding ABD) | $ | 240,446 | $ | 239,730 | ||||
Operating Expenses (Excluding ABD & other ABD expenses paid by holding company) | $ | 157,602 | $ | 149,904 |
Greater | Bay Bancorp Reports Financial Results for the Third Quarter of 2006 |
Page 10 of 14
GREATER BAY BANCORP
September 30, 2006 - FINANCIAL SUMMARY (UNAUDITED)
(Dollars in 000’s)
SELECTED CONSOLIDATED FINANCIAL CONDITION DATA AND RATIOS:
Sep 30 2006 | Jun 30 2006 | Mar 31 2006 | Dec 31 2005 | Sep 30 2005 | ||||||||||||||||
Cash and cash equivalents | $ | 160,572 | $ | 198,716 | $ | 167,203 | $ | 152,153 | $ | 153,284 | ||||||||||
Fed funds sold | — | 36,000 | — | — | 20,000 | |||||||||||||||
Securities | 1,572,109 | 1,565,732 | 1,468,123 | 1,493,584 | 1,487,935 | |||||||||||||||
Loans: | ||||||||||||||||||||
Commercial (1) | 2,136,235 | 2,072,334 | 2,046,402 | 2,052,049 | 2,005,198 | |||||||||||||||
Term real estate - commercial | 1,362,794 | 1,340,762 | 1,389,635 | 1,389,329 | 1,432,939 | |||||||||||||||
Total commercial (1) | 3,499,029 | 3,413,096 | 3,436,037 | 3,441,378 | 3,438,137 | |||||||||||||||
Real estate construction and land | 753,416 | 762,409 | 688,086 | 644,883 | 609,969 | |||||||||||||||
Residential mortgage | 277,038 | 275,332 | 271,658 | 266,263 | 258,268 | |||||||||||||||
Real estate other | 223,373 | 217,889 | 230,190 | 263,164 | 261,969 | |||||||||||||||
Consumer and other (1) | 79,131 | 101,821 | 100,468 | 109,168 | 116,026 | |||||||||||||||
Deferred costs and fees, net (1) | 4,278 | 4,066 | 3,285 | 3,113 | 2,344 | |||||||||||||||
Total loans, net of deferred costs and fees (1) | 4,836,265 | 4,774,613 | 4,729,724 | 4,727,969 | 4,686,713 | |||||||||||||||
Allowance for loan and lease losses | (71,323 | ) | (71,689 | ) | (74,568 | ) | (82,159 | ) | (92,857 | ) | ||||||||||
Total loans, net | 4,764,942 | 4,702,924 | 4,655,156 | 4,645,810 | 4,593,856 | |||||||||||||||
Goodwill | 242,687 | 243,343 | 242,728 | 243,289 | 236,511 | |||||||||||||||
Other intangible assets | 44,515 | 46,227 | 48,005 | 49,741 | 51,739 | |||||||||||||||
Other assets | 548,530 | 576,712 | 527,291 | 536,392 | 529,983 | |||||||||||||||
Total assets | $ | 7,333,355 | $ | 7,369,654 | $ | 7,108,506 | $ | 7,120,969 | $ | 7,073,308 | ||||||||||
Deposits: | ||||||||||||||||||||
Demand, noninterest-bearing | $ | 980,050 | $ | 1,015,734 | $ | 1,004,575 | $ | 1,093,157 | $ | 1,066,536 | ||||||||||
MMDA, NOW and savings | 2,613,387 | 2,734,656 | 2,957,354 | 3,000,647 | 3,003,159 | |||||||||||||||
Time deposits, $100,000 and over | 784,557 | 776,712 | 782,891 | 741,682 | 750,406 | |||||||||||||||
Other time deposits | 681,104 | 495,131 | 363,941 | 223,053 | 195,315 | |||||||||||||||
Total deposits | 5,059,098 | 5,022,233 | 5,108,761 | 5,058,539 | 5,015,416 | |||||||||||||||
Other borrowings | 994,044 | 970,390 | 750,248 | 797,802 | 813,006 | |||||||||||||||
Subordinated debt | 180,929 | 287,631 | 210,311 | 210,311 | 210,311 | |||||||||||||||
Other liabilities | 249,553 | 261,907 | 232,866 | 265,607 | 252,510 | |||||||||||||||
Total liabilities | 6,483,624 | 6,542,161 | 6,302,186 | 6,332,259 | 6,291,243 | |||||||||||||||
Minority interest: | ||||||||||||||||||||
Peferred stock of real estate investment trust subsidiaries | 12,821 | 12,780 | 12,739 | 12,699 | 12,658 | |||||||||||||||
Convertible preferred stock | 103,094 | 103,096 | 103,097 | 103,387 | 102,706 | |||||||||||||||
Common shareholders’ equity | 733,816 | 711,617 | 690,484 | 672,624 | 666,701 | |||||||||||||||
Total equity | 836,910 | 814,713 | 793,581 | 776,011 | 769,407 | |||||||||||||||
Total liabilities and total equity | $ | 7,333,355 | $ | 7,369,654 | $ | 7,108,506 | $ | 7,120,969 | $ | 7,073,308 | ||||||||||
RATIOS: | ||||||||||||||||||||
Loan growth, current quarter to prior year quarter | 3.19 | % | 0.72 | % | 4.93 | % | 5.34 | % | 4.31 | % | ||||||||||
Loan growth, current quarter to prior quarter, annualized | 5.12 | % | 3.81 | % | 0.15 | % | 3.49 | % | -4.50 | % | ||||||||||
Loan growth, YTD | 3.06 | % | 1.99 | % | 0.15 | % | 5.34 | % | 5.91 | % | ||||||||||
Core loan growth, current quarter to prior year quarter (2) | 3.90 | % | 1.32 | % | 1.39 | % | 0.57 | % | -1.13 | % | ||||||||||
Core loan growth, current quarter to prior quarter, annualized (2) | 5.91 | % | 4.47 | % | 0.66 | % | 4.30 | % | -4.09 | % | ||||||||||
Core loan growth, YTD (2) | 3.73 | % | 2.58 | % | 0.66 | % | 0.57 | % | -0.68 | % | ||||||||||
Deposit growth, current quarter to prior year quarter | 0.87 | % | 2.93 | % | 2.26 | % | -0.87 | % | -3.47 | % | ||||||||||
Deposit growth, current quarter to prior quarter, annualized | 2.91 | % | -6.79 | % | 4.03 | % | 3.41 | % | 11.07 | % | ||||||||||
Deposit growth, YTD | 0.01 | % | -1.45 | % | 4.03 | % | -0.87 | % | -2.29 | % | ||||||||||
Core deposit growth, current quarter to prior year quarter (3) | -10.48 | % | -6.63 | % | -5.78 | % | -5.03 | % | -6.45 | % | ||||||||||
Core deposit growth, current quarter to prior quarter, annualized (3) | -14.43 | % | -19.72 | % | -8.31 | % | -1.02 | % | 2.02 | % | ||||||||||
Core deposit growth, YTD (3) | -13.71 | % | -13.84 | % | -8.31 | % | -5.03 | % | -6.40 | % | ||||||||||
Revenue growth, current quarter to prior year quarter (4) | -2.66 | % | 2.46 | % | 8.96 | % | 7.03 | % | 3.77 | % | ||||||||||
Revenue growth, current quarter to prior quarter, annualized (4) | -10.93 | % | -12.82 | % | 19.80 | % | -5.60 | % | 9.35 | % | ||||||||||
Net interest income growth, current quarter to prior year quarter | -6.21 | % | 0.63 | % | 0.88 | % | -0.52 | % | -3.23 | % | ||||||||||
Net interest income growth, current quarter to prior quarter, annualized | -12.41 | % | -4.73 | % | -6.75 | % | -1.45 | % | 15.59 | % |
(1) | In Q3 2006, $15.4 million of deferred costs and fees on leases were reclassified from commercial loans and consumer and other loans into net deferred costs and fees. Prior periods have been changed to conform to this presentation. |
(2) | Core loans calculated as total loans less purchased residential mortgage loans. |
(3) | Core deposits calculated as total deposits less institutional and brokered time deposits. |
(4) | Revenue is the sum of net interest income before (recovery of) / provision for credit losses and total non-interest income. |
Greater Bay Bancorp Reports Financial Results for the Third Quarter of 2006
Page 11 of 14
GREATER BAY BANCORP
September 30, 2006 - FINANCIAL SUMMARY (UNAUDITED)
(Dollars in 000’s)
SELECTED AVERAGE BALANCE SHEET AND YIELD DATA:
Three months ended | ||||||||||||||||||||
September 30, 2006 | June 30, 2006 | |||||||||||||||||||
Tax-Equivalent Basis (1) | Average balance (2) | Interest | Average yield / rate | Average balance (2) | Interest | Average yield / rate | ||||||||||||||
INTEREST-EARNING ASSETS: | ||||||||||||||||||||
Fed funds sold | $ | 33,141 | $ | 432 | 5.18 | % | $ | 10,791 | $ | 128 | 4.77 | % | ||||||||
Securities: | ||||||||||||||||||||
Taxable | 1,509,123 | 17,537 | 4.61 | % | 1,433,756 | 16,030 | 4.48 | % | ||||||||||||
Tax-exempt (1) | 91,142 | 1,590 | 6.92 | % | 86,323 | 1,543 | 7.16 | % | ||||||||||||
Other short-term (3) | 9,993 | 83 | 3.29 | % | 9,348 | 46 | 1.99 | % | ||||||||||||
Loans (4) | 4,785,791 | 94,781 | 7.86 | % | 4,705,859 | 91,074 | 7.76 | % | ||||||||||||
Total interest-earning assets | 6,429,190 | 114,423 | 7.06 | % | 6,246,077 | 108,821 | 6.99 | % | ||||||||||||
Noninterest-earning assets | 911,348 | — | 888,886 | — | ||||||||||||||||
Total assets | $ | 7,340,538 | 114,423 | $ | 7,134,963 | 108,821 | ||||||||||||||
INTEREST-BEARING LIABILITIES: | ||||||||||||||||||||
Deposits: | ||||||||||||||||||||
MMDA, NOW and Savings | $ | 2,719,915 | 17,036 | 2.48 | % | $ | 2,807,337 | 15,094 | 2.16 | % | ||||||||||
Time deposits over $100,000 | 787,289 | 9,506 | 4.79 | % | 780,415 | 8,466 | 4.35 | % | ||||||||||||
Other time deposits | 595,200 | 6,973 | 4.65 | % | 414,765 | 4,381 | 4.24 | % | ||||||||||||
Total interest-bearing deposits | 4,102,404 | 33,515 | 3.24 | % | 4,002,517 | 27,941 | 2.80 | % | ||||||||||||
Short-term borrowings | 299,675 | 3,674 | 4.86 | % | 262,439 | 2,947 | 4.50 | % | ||||||||||||
CODES | — | — | 0.00 | % | — | — | 0.00 | % | ||||||||||||
Subordinated debt | 251,677 | 5,355 | 8.44 | % | 224,755 | 4,867 | 8.68 | % | ||||||||||||
Other long-term borrowings | 579,694 | 7,598 | 5.20 | % | 547,494 | 6,732 | 4.93 | % | ||||||||||||
Total interest-bearing liabilities | 5,233,450 | 50,142 | 3.80 | % | 5,037,205 | 42,487 | 3.38 | % | ||||||||||||
Noninterest-bearing deposits | 993,457 | 1,013,577 | ||||||||||||||||||
Other noninterest-bearing liabilities | 274,367 | 263,424 | ||||||||||||||||||
Minority Interest: Preferred stock of real estate investment trust subsidiaries | 12,796 | 12,756 | ||||||||||||||||||
Shareholders’ equity | 826,468 | 808,001 | ||||||||||||||||||
Total shareholders’ equity and liabilities | $ | 7,340,538 | 50,142 | $ | 7,134,963 | 42,487 | ||||||||||||||
Net interest income, on a tax-equivalent basis (1) | 64,281 | 66,334 | ||||||||||||||||||
Net interest margin (5) | 3.97 | % | 4.26 | % | ||||||||||||||||
Reconciliation to reported net interest income: | ||||||||||||||||||||
Adjustment for tax equivalent basis | (507 | ) | (500 | ) | ||||||||||||||||
Net interest income, as reported | $ | 63,774 | $ | 65,834 | ||||||||||||||||
(1) | Income from tax-exempt securities issued by state and local governments or authorities, is adjusted by an increment that equates tax-exempt income to tax equivalentbasis (assuming a 35% federal income tax rate). |
(2) | Nonaccrual loans are included in the average balance. |
(3) | Includes average interest-earning deposits in other financial institutions. |
(4) | Amortization of deferred loan fees, net of the amortization of deferred costs, resulted in an increase of interest income on loans by $364,000 and $602,000, for thethree months ended September 30, 2006 and June 30, 2006, respectively. |
(5) | Net interest margin during the period equals (a) the difference between tax-equivalent interest income on interest-earning assets and the interest expense on interest-bearingliabilities, divided by (b) average interest-earning assets for the period, annualized. |
Greater | Bay Bancorp Reports Financial Results for the Third Quarter of 2006 |
Page 12 of 14
GREATER BAY BANCORP
September 30, 2006 - FINANCIAL SUMMARY (UNAUDITED)
(Dollars in 000’s)
SELECTED AVERAGE BALANCE SHEET AND YIELD DATA:
Three months ended | ||||||||||||||||||||
September 30, 2006 | September 30, 2005 | |||||||||||||||||||
Tax-Equivalent Basis (1) | Average balance (2) | Interest | Average yield / rate | Average balance (2) | Interest | Average yield / rate | ||||||||||||||
INTEREST-EARNING ASSETS: | ||||||||||||||||||||
Fed funds sold | $ | 33,141 | $ | 432 | 5.18 | % | $ | 45,033 | $ | 384 | 3.38 | % | ||||||||
Securities: | ||||||||||||||||||||
Taxable | 1,509,123 | 17,537 | 4.61 | % | 1,446,353 | 15,117 | 4.15 | % | ||||||||||||
Tax-exempt (1) | 91,142 | 1,590 | 6.92 | % | 82,724 | 1,514 | 7.27 | % | ||||||||||||
Other short-term (3) | 9,993 | 83 | 3.29 | % | 11,923 | 59 | 1.96 | % | ||||||||||||
Loans (4) | 4,785,791 | 94,781 | 7.86 | % | 4,699,570 | 84,135 | 7.10 | % | ||||||||||||
Total interest-earning assets | 6,429,190 | 114,423 | 7.06 | % | 6,285,603 | 101,209 | 6.39 | % | ||||||||||||
Noninterest-earning assets | 911,348 | — | 902,363 | — | ||||||||||||||||
Total assets | $ | 7,340,538 | 114,423 | $ | 7,187,966 | 101,209 | ||||||||||||||
INTEREST-BEARING LIABILITIES: | ||||||||||||||||||||
Deposits: | ||||||||||||||||||||
MMDA, NOW and Savings | $ | 2,719,915 | 17,036 | 2.48 | % | $ | 3,004,193 | 13,042 | 1.72 | % | ||||||||||
Time deposits over $100,000 | 787,289 | 9,506 | 4.79 | % | 729,040 | 5,562 | 3.03 | % | ||||||||||||
Other time deposits | 595,200 | 6,973 | 4.65 | % | 180,933 | 1,172 | 2.57 | % | ||||||||||||
Total interest-bearing deposits | 4,102,404 | 33,515 | 3.24 | % | 3,914,166 | 19,776 | 2.00 | % | ||||||||||||
Short-term borrowings | 299,675 | 3,674 | 4.86 | % | 350,989 | 3,290 | 3.72 | % | ||||||||||||
CODES | — | — | 0.00 | % | 93,304 | 131 | 0.56 | % | ||||||||||||
Subordinated debt | 251,677 | 5,355 | 8.44 | % | 210,311 | 4,446 | 8.39 | % | ||||||||||||
Other long-term borrowings | 579,694 | 7,598 | 5.20 | % | 417,583 | 5,071 | 4.82 | % | ||||||||||||
Total interest-bearing liabilities | 5,233,450 | 50,142 | 3.80 | % | 4,986,353 | 32,714 | 2.60 | % | ||||||||||||
Noninterest-bearing deposits | 993,457 | 1,132,668 | ||||||||||||||||||
Other noninterest-bearing liabilities | 274,367 | 282,409 | ||||||||||||||||||
Minority Interest: Preferred stock of real estate investment trust subsidiaries | 12,796 | 12,634 | ||||||||||||||||||
Shareholders’ equity | 826,468 | 773,902 | ||||||||||||||||||
Total shareholders’ equity and liabilities | $ | 7,340,538 | 50,142 | $ | 7,187,966 | 32,714 | ||||||||||||||
Net interest income, on a tax-equivalent basis (1) | 64,281 | 68,495 | ||||||||||||||||||
Net interest margin (5) | 3.97 | % | 4.32 | % | ||||||||||||||||
Reconciliation to reported net interest income: | ||||||||||||||||||||
Adjustment for tax equivalent basis | (507 | ) | (499 | ) | ||||||||||||||||
Net interest income, as reported | $ | 63,774 | $ | 67,996 | ||||||||||||||||
(1) | Income from tax-exempt securities issued by state and local governments or authorities, is adjusted by an increment that equates tax-exempt income to tax equivalentbasis (assuming a 35% federal income tax rate). |
(2) | Nonaccrual loans are included in the average balance. |
(3) | Includes average interest-earning deposits in other financial institutions. |
(4) | Amortization of deferred loan fees, net of the amortization of deferred costs, resulted in an increase of interest income on loans by $364,000 and $841,000 for thethree months ended September 30, 2006 and September 30, 2005, respectively. |
(5) | Net interest margin during the period equals (a) the difference between tax-equivalent interest income on interest-earning assets and the interest expense on interest-bearingliabilities, divided by (b) average interest-earning assets for the period, annualized. |
Greater Bay Bancorp Reports Financial Results for the Third Quarter of 2006
Page 13 of 14
GREATER BAY BANCORP
September 30, 2006 - FINANCIAL SUMMARY (UNAUDITED)
(Dollars in 000’s)
SELECTED AVERAGE BALANCE SHEET AND YIELD DATA:
Year to date | ||||||||||||||||||||
September 30, 2006 | September 30, 2005 | |||||||||||||||||||
Tax-Equivalent Basis (1) | Average balance (2) | Interest | Average yield / rate | Average balance (2) | Interest | Average yield / rate | ||||||||||||||
INTEREST-EARNING ASSETS: | ||||||||||||||||||||
Fed funds sold | $ | 18,813 | $ | 692 | 4.92 | % | $ | 38,412 | $ | 789 | 2.75 | % | ||||||||
Securities: | ||||||||||||||||||||
Taxable | 1,456,380 | 49,191 | 4.52 | % | 1,480,290 | 47,196 | 4.26 | % | ||||||||||||
Tax-exempt (1) | 86,718 | 4,625 | 7.13 | % | 84,012 | 4,472 | 7.12 | % | ||||||||||||
Other short-term (3) | 9,701 | 164 | 2.26 | % | 8,117 | 95 | 1.56 | % | ||||||||||||
Loans (4) | 4,727,539 | 272,813 | 7.72 | % | 4,581,382 | 237,486 | 6.93 | % | ||||||||||||
Total interest-earning assets | 6,299,151 | 327,485 | 6.95 | % | 6,192,213 | 290,038 | 6.26 | % | ||||||||||||
Noninterest-earning assets | 903,335 | — | 886,871 | — | ||||||||||||||||
Total assets | $ | 7,202,486 | 327,485 | $ | 7,079,084 | 290,038 | ||||||||||||||
INTEREST-BEARING LIABILITIES: | ||||||||||||||||||||
Deposits: | ||||||||||||||||||||
MMDA, NOW and Savings | $ | 2,824,987 | 46,202 | 2.19 | % | $ | 3,130,250 | 39,596 | 1.69 | % | ||||||||||
Time deposits over $100,000 | 774,767 | 25,294 | 4.36 | % | 662,113 | 13,175 | 2.66 | % | ||||||||||||
Other time deposits | 424,817 | 13,722 | 4.32 | % | 151,668 | 2,625 | 2.31 | % | ||||||||||||
Total interest-bearing deposits | 4,024,571 | 85,218 | 2.83 | % | 3,944,031 | 55,396 | 1.88 | % | ||||||||||||
Short-term borrowings | 283,572 | 9,604 | 4.53 | % | 339,960 | 8,870 | 3.49 | % | ||||||||||||
CODES | 24,758 | 101 | 0.55 | % | 154,463 | 631 | 0.55 | % | ||||||||||||
Subordinated debt | 229,066 | 14,779 | 8.63 | % | 210,311 | 13,135 | 8.24 | % | ||||||||||||
Other long-term borrowings | 534,221 | 20,061 | 5.02 | % | 291,833 | 11,063 | 5.00 | % | ||||||||||||
Total interest-bearing liabilities | 5,096,188 | 129,763 | 3.40 | % | 4,940,598 | 89,095 | 2.41 | % | ||||||||||||
Noninterest-bearing deposits | 1,016,102 | 1,089,518 | ||||||||||||||||||
Other noninterest-bearing liabilities | 271,014 | 264,535 | ||||||||||||||||||
Minority Interest: Preferred stock of real estate investment trust subsidiaries | 12,756 | 12,599 | ||||||||||||||||||
Shareholders’ equity | 806,426 | 771,834 | ||||||||||||||||||
Total shareholders’ equity and liabilities | $ | 7,202,486 | 129,763 | $ | 7,079,084 | 89,095 | ||||||||||||||
Net interest income, on a tax-equivalent basis (1) | 197,722 | 200,943 | ||||||||||||||||||
Net interest margin (5) | 4.20 | % | 4.34 | % | ||||||||||||||||
Reconciliation to reported net interest income: | ||||||||||||||||||||
Adjustment for tax equivalent basis | (1,494 | ) | (1,480 | ) | ||||||||||||||||
Net interest income, as reported | $ | 196,228 | $ | 199,463 | ||||||||||||||||
(1) | Income from tax-exempt securities issued by state and local governments or authorities, is adjusted by an increment that equates tax-exempt income to tax equivalent basis (assuming a 35% federal income tax rate). |
(2) | Nonaccrual loans are included in the average balance. |
(3) | Includes average interest-earning deposits in other financial institutions. |
(4) | Amortization of deferred loan fees, net of the amortization of deferred costs, resulted in an increase of interest income on loans by $1,211,000 and $838,000for the nine months ended September 30, 2006 and September 30, 2005, respectively. |
(5) | Net interest margin during the period equals (a) the difference between tax-equivalent interest income on interest-earning assets and the interest expense oninterest-bearing liabilities, divided by (b) average interest-earning assets for the period, annualized. |
Greater Bay Bancorp Reports Financial Results for the Third Quarter of 2006
Page 14 of 14
GREATER BAY BANCORP
September 30, 2006 - FINANCIAL SUMMARY (UNAUDITED)
(Dollars and shares in 000’s, except per share data)
SELECTED CONSOLIDATED CREDIT QUALITY DATA:
Sep 30 2006 | Jun 30 2006 | Mar 31 2006 | Dec 31 2005 | Sep 30 2005 | ||||||||||||||||
Nonperforming assets (1) | ||||||||||||||||||||
Commercial: | ||||||||||||||||||||
Matsco/GBC | $ | 8,323 | $ | 7,257 | $ | 8,011 | $ | 8,883 | $ | 9,299 | ||||||||||
SBA | 2,881 | 4,536 | 3,627 | 6,497 | 7,612 | |||||||||||||||
Other | 6,458 | 4,775 | 9,184 | 9,142 | 7,578 | |||||||||||||||
Total commercial | 17,662 | 16,568 | 20,822 | 24,522 | 24,489 | |||||||||||||||
Real estate: | ||||||||||||||||||||
Commercial | 10,939 | 14,763 | 8,203 | 8,434 | 9,844 | |||||||||||||||
Construction and land | 323 | 323 | 3,242 | 323 | — | |||||||||||||||
Other | — | 3 | 7 | 33,312 | 33,777 | |||||||||||||||
Total real estate | 11,262 | 15,089 | 11,452 | 42,069 | 43,621 | |||||||||||||||
Consumer and other | 139 | 611 | 718 | 4,503 | 3,821 | |||||||||||||||
Total nonaccrual loans | 29,063 | 32,268 | 32,992 | 71,094 | 71,931 | |||||||||||||||
OREO | — | — | — | — | — | |||||||||||||||
Other nonperforming assets | 603 | 361 | 438 | 631 | 1,153 | |||||||||||||||
Total nonperforming assets (1) | $ | 29,666 | $ | 32,629 | $ | 33,430 | $ | 71,725 | $ | 73,084 | ||||||||||
Net loan charge-offs (recoveries) (2) | $ | 223 | $ | 2,662 | $ | 43 | $ | 1,207 | $ | 3,098 | ||||||||||
Ratio of allowance for loan and lease losses to: | ||||||||||||||||||||
End of period loans | 1.48 | % | 1.50 | % | 1.58 | % | 1.74 | % | 1.98 | % | ||||||||||
Total nonaccrual loans | 245.41 | % | 222.17 | % | 226.02 | % | 115.56 | % | 129.09 | % | ||||||||||
Ratio of (recovery of ) / provision for credit losses to average loans, annualized | -0.04 | % | -0.16 | % | -0.52 | % | -0.89 | % | -0.28 | % | ||||||||||
Total nonaccrual loans to total loans | 0.60 | % | 0.68 | % | 0.70 | % | 1.50 | % | 1.53 | % | ||||||||||
Total nonperforming assets to total assets | 0.40 | % | 0.44 | % | 0.47 | % | 1.01 | % | 1.03 | % | ||||||||||
Ratio of quarterly net loan charge-offs to average loans, annualized | 0.02 | % | 0.23 | % | 0.00 | % | 0.10 | % | 0.26 | % | ||||||||||
Ratio of YTD net loan charge-offs to YTD average loans | 0.08 | % | 0.12 | % | 0.00 | % | 0.24 | % | 0.29 | % | ||||||||||
___________ (1) Nonperforming assets include nonaccrual loans, other real estate owned and other nonperforming assets. |
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(2) Net loan charge-offs are loan charge-offs net of recoveries. |
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SELECTED QUARTERLY CAPITAL RATIOS AND DATA:
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Sep 30 2006 | Jun 30 2006 | Mar 31 2006 | Dec 31 2005 | Sep 30 2005 | ||||||||||||||||
Tier 1 leverage ratio | 10.63 | % | 12.07 | % | 10.77 | % | 10.41 | % | 10.23 | % | ||||||||||
Tier 1 risk-based capital ratio | 12.15 | % | 13.49 | % | 12.48 | % | 12.01 | % | 12.25 | % | ||||||||||
Total risk-based capital ratio | 13.40 | % | 14.93 | % | 13.73 | % | 13.26 | % | 13.51 | % | ||||||||||
Total equity to assets ratio | 11.41 | % | 11.05 | % | 11.16 | % | 10.90 | % | 10.88 | % | ||||||||||
Common equity to assets ratio | 10.01 | % | 9.66 | % | 9.71 | % | 9.45 | % | 9.43 | % | ||||||||||
Tier I capital | $ | 748,071 | $ | 824,154 | $ | 734,692 | $ | 708,563 | $ | 702,030 | ||||||||||
Total risk-based capital | $ | 825,036 | $ | 911,802 | $ | 808,436 | $ | 782,525 | $ | 774,044 | ||||||||||
Risk weighted assets | $ | 6,155,489 | $ | 6,108,101 | $ | 5,889,032 | $ | 5,900,425 | $ | 5,730,710 | ||||||||||
NON-GAAP RATIOS (1): | ||||||||||||||||||||
Tangible common equity to tangible assets - end of period (2) | 6.34 | % | 5.96 | % | 5.86 | % | 5.56 | % | 5.58 | % | ||||||||||
Tangible common book value per common share - end of period (3) | $ | 8.75 | $ | 8.29 | $ | 7.95 | $ | 7.61 | $ | 7.51 | ||||||||||
Common book value per common share - end of period (4) | $ | 14.38 | $ | 13.98 | $ | 13.73 | $ | 13.48 | $ | 13.22 | ||||||||||
Total common shares outstanding - end of period | 51,047 | 50,917 | 50,288 | 49,906 | 50,425 | |||||||||||||||
___________ (1) The following table provides a reconciliation of common equity to tangible common equity and total assets to tangible assets:
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Common shareholders’ equity | $ | 733,816 | $ | 711,617 | $ | 690,484 | $ | 672,624 | $ | 666,701 | ||||||||||
Less: goodwill and other Intangible assets | (287,202 | ) | (289,570 | ) | (290,733 | ) | (293,030 | ) | (288,250 | ) | ||||||||||
Tangible common equity | $ | 446,614 | $ | 422,047 | $ | 399,751 | $ | 379,594 | $ | 378,451 | ||||||||||
Total assets | $ | 7,333,355 | $ | 7,369,654 | $ | 7,108,506 | $ | 7,120,969 | $ | 7,073,308 | ||||||||||
Less: goodwill and other intangible assets | (287,202 | ) | (289,570 | ) | (290,733 | ) | (293,030 | ) | (288,250 | ) | ||||||||||
Tangible assets | $ | 7,046,153 | $ | 7,080,084 | $ | 6,817,773 | $ | 6,827,939 | $ | 6,785,058 | ||||||||||
(2) Computed as common shareholders’ equity, less goodwill and other intangible assets divided by tangible assets |
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(3) Computed as common shareholders’ equity, less goodwill and other intangible assets divided by total common shares outstanding - end of period |
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(4) Computed as common shareholders’ equity divided by common shares outstanding - end of period. |
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