Exhibit 99.1
| Media Contact | Investor Contact | |
| Ed Steadham 203-578-2287 | Terry Mangan 203-578-2318 | |
| esteadham@websterbank.com | tmangan@websterbank.com |
WEBSTER REPORTS PRELIMINARY FOURTH QUARTER 2008 LOSS
Company Strengthened Capital, Bolstered Loan Loss Reserves, Reduced Expenses
WATERBURY, Conn., January 23, 2009 – Webster Financial Corporation (NYSE: WBS), the holding company for Webster Bank, N.A., today announced preliminary results for the fourth quarter and the year ended December 31, 2008. Final results are pending completion of goodwill impairment analysis as outlined below.
Key points for the quarter included:
Loss of $300 million or $5.91 per diluted share, largely driven by a $188.9 million non-cash goodwill impairment charge that the Company has determined it will record which has no effect on the Company’s liquidity and capital positions, and $129.6 million for non-cash other-than-temporary impairment (“OTTI”) charges on certain investment securities
Provision for credit losses of $100 million against $52.8 million of net loan charge-offs; allowance for credit losses increased to 2.02 percent of total loans and 106 percent of nonperforming loans. Past due loans and non performing loans grew at a reduced rate from last quarter end
Planned elimination of approximately 200 additional positions across the Company, resulting in an additional severance charge of $4.2 million
Pre-tax operating loss of $35.9 million or $.83 per diluted share before OTTI, goodwill impairment, securities gain and losses and severance charges
Strong tangible capital position, including all of the above charges, of 7.70 percent at year end compared to 5.89 percent a year ago. Significantly exceed all requirements for well capitalized regulatory ratios
Dividend reduced to $.01, reflecting desire to preserve strong capital position
Goodwill Impairment
As indicated in the Form 8-K filed January 15, 2009, the Company has been testing its goodwill for potential impairment based on the continued public capital markets disruption and the Company’s market capitalization deterioration compared to book value. The Company engaged an independent valuation firm to assist with the testing of the carrying value of goodwill, which totaled $718.5 million at September 30, 2008. In light of recent market and economic events, the Company is continuing to review goodwill to determine whether any further impairment results. Based on analysis to date, the Company has determined there was goodwill impairment of $188.9 million related to its commercial banking, consumer finance and other business segments. However, a final conclusion has not been reached regarding the Company’s retail banking segment. As to that segment, the Company could incur impairment charges to further reduce the carrying amount of goodwill, which could also result in an increase in the valuation allowance against its deferred tax asset. A goodwill impairment charge is non-cash in nature and does not affect the Company’s liquidity, tangible equity or its well capitalized position under regulatory capital ratios. The Company expects to complete its goodwill analysis in the near future.
| Pre-tax Operating Income | ||||||||||||||||
| (in thousands, except per share data) | Three Months Ended | Twelve Months Ended | Twelve Months Ended | |||||||||||||
| Dec. 31, 2008 | Sept. 30, 2008 | Dec. 31, 2008 | Dec. 31, 2007 | |||||||||||||
Net (Loss) Income Before Tax | $ | (364,489 | ) | $ | (18,114 | ) | $ | (384,597 | ) | $ | 158,784 | |||||
Adjustments: | ||||||||||||||||
OTTI Charge | 129,593 | 33,507 | 219,277 | 3,565 | ||||||||||||
Securities Losses (Gains) | 4,233 | 2,110 | 6,094 | (1,721 | ) | |||||||||||
Severance | 5,905 | 1,535 | 16,158 | 15,608 | ||||||||||||
Impairment of Goodwill | 188,866 | 1,013 | 198,379 | — | ||||||||||||
Gain on Webster Capital Trust Securities | — | — | — | (2,130 | ) | |||||||||||
Visa Share Redemption | — | — | (1,625 | ) | — | |||||||||||
Total Adjustments | 328,597 | 38,165 | 438,283 | 15,322 | ||||||||||||
Pre-tax Operating Loss Income | $ | (35,892 | ) | $ | 20,051 | $ | 53,686 | $ | 174,106 | |||||||
Pre Tax Loss Earnings Per Share | $ | (0.83 | ) | $ | 0.29 | $ | 0.80 | $ | 3.17 | |||||||
For the full year 2008, net loss totaled $321.8 million, or $6.42 loss per diluted share, compared to net income of $96.8 million, or $1.76 per diluted share in the year-ago period. Pre-tax operating loss in the full year 2008 before OTTI, goodwill impairment, securities gains/losses, and severance charges was $53.7 million or $.80 per diluted share compared to $174.1 million, or $3.17 per diluted share for the 2007 full year. Pre-tax operating income and operating EPS, representing pre-tax earnings and EPS determined in accordance with generally accepted accounting principles (“GAAP”) excluding the effects of the pre-tax, non-cash OTTI charge and other items noted above, provide a more meaningful comparison for effectively evaluating the Company’s core operating results.
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Webster Chairman and Chief Executive Officer Jim Smith said, “Webster’s exceptionally strong capital position enables us to act purposefully to address the current and future challenges faced by the financial services industry. We are committed and well prepared to meet our customers’ needs and to contribute to the eventual economic recovery in our region.”
Webster will provide details on its fourth quarter performance in a conference call at 9:00 AM EST today (refer to details for the conference call at the end of this release). In addition, Webster has posted supplemental information regarding its investment securities portfolio and other items on our website atwww.wbst.com.
Previously announced charges taken in the fourth quarter included $118.0 million in write-downs for OTTI for certain capital trust investment securities classified as available for sale and $11.6 million for equity securities also classified as available for sale. The $188.9 million goodwill impairment charge reflects the effect of current economic deterioration on loan values and the impact of substantial interest rate decreases in the fourth quarter. This non-cash charge has no effect on the company’s liquidity and capital positions.
Of the $5.9 million severance charge recorded in the fourth quarter, $4.2 million relates to the next phase of the OneWebster earnings optimization program. This program is expected to result in $50 million in annual benefits by 2010. This next phase includes the elimination of 200 positions in addition to the 237 net position reductions previously announced. Webster Chief Financial Officer and Chief Risk Officer Jerry Plush stated, “We recognize that further expense discipline is essential given current economic conditions. This next phase focused on centralization of like functions and spans of control.”
On December 18, 2008, the Office of the Comptroller of the Currency (OCC) terminated the Memorandum of Understanding (MOU) issued by the OCC on July 24, 2006 in relation to bank compliance, Bank Secrecy Act, Flood Act and internal audit programs.
Webster also announced today that its Board of Directors, at its January 22, 2009 meeting, declared a regular quarterly cash dividend at the reduced level of $.01 per common share. The dividend is payable on February 19, 2009 to shareholders of record on February 5, 2009. Chairman and CEO Smith noted: “Given this extended period of unprecedented economic uncertainty, the Board has chosen to reduce the dividend to preserve capital.”
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Asset Quality
| • | Total nonperforming assets were $263.2 million or 2.15 percent of total loans and other real estate owned at December 31, 2008 compared to $250.5 million or 1.94 percent at September 30, 2008. The $12.7 million increase in nonperforming assets was primarily attributed to a $7.9 million increase in other real estate owned and a $6.2 million increase in non performing loans in the liquidating portfolio offset by a decline of $1.4 million of nonperforming loans in the continuing portfolio |
| • | Past due loans for the continuing portfolios totaled $117.4 million at December 31, 2008, an increase of $15.3 million compared to $102.1 million at September 30, 2008. The increase was primarily related to increases of $12.3 million in commercial, $1.8 million in equipment financing, $5.5 million in residential loans and $10.6 million in consumer loans offset by decreases in commercial real estate of $11.1 million and residential development of $3.6 million. Past due loans for the liquidating portfolio totaled $21.0 million at December 31, 2008 compared to $19.1 million at September 30, 2008. |
Net interest income
| • | Net interest margin was 3.20 percent in the fourth quarter compared to 3.32 percent in the third quarter; the decline reflects the impact of three Federal Reserve rate reductions totaling 175 bps in the fourth quarter as well as interest reversals on nonaccrual loans and pooled trust preferred securities. |
| • | Average earning assets totaled $15.9 billion, up from $15.8 billion last quarter. |
Provision For Credit Losses
| • | $75.0 million of the provision for credit losses was related to the Company’s continuing portfolios, including $30.0 million for residential development loans in the commercial real estate portfolio, and $25.0 million was related to the liquidating home equity portfolio. |
| • | The increase over the third quarter reflects charge-offs based on recent appraisals on nonaccruing residential development loans, higher forecasted charge-offs for the liquidating home equity portfolio in light of deteriorating economic conditions, and increased reserve levels for other lines of business given economic deterioration. |
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Non-interest income
| • | Deposit service fees declined by $1.7 million from last quarter; primarily from a decline in NSF fees. |
| • | Wealth and investment services revenues declined by $590,000; primarily from a decline in the value of assets under management due to adverse market conditions. |
| • | Loss on sale of securities totaled $4.2 million; primarily to maximize tax strategies. |
Non-interest expenses
| • | Excluding goodwill impairment and OneWebster charges, the decline from last quarter represents reduced operating expenses from One Webster initiatives as well as a significant reduction in incentive compensation. |
Income Taxes
| • | Due to the pre-tax loss, the effective tax rate for the fourth quarter was not meaningful. The $64.0 million tax benefit in the quarter on the $364.5 million pre-tax loss applicable to continuing operations in the period was impacted primarily by substantially no tax benefit being available on the goodwill impairment charge ($66 million otherwise) and to a lesser extent, no tax benefit being available on a portion of the securities losses. |
| • | For tax purposes, $19.6 million of the securities losses are capital in nature and the tax benefits on those have been limited ($6.8 million otherwise). Offsetting that, in part, was the recognition of a $3.8 million tax benefit due to the October 2008 passage of the U.S. Emergency Economic Stabilization Act, which included a provision permitting banks to treat losses relating to FNMA and FHLMC preferred stock as ordinary instead of capital. The $3.8 million of benefit pertains to losses incurred by the Company prior to the fourth quarter when the tax benefits were limited. |
Investment securities
| • | Total investments were $3.8 billion at December 31, 2008 compared to $3.0 billion at September 30, 2008. The increase was primarily driven by a $468 million residential loan securitization undertaken in the fourth quarter. The securitization was undertaken to generate additional collateral for borrowings and municipal deposits. |
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Loans
| • | Total loans were $12.2 billion at December 31, 2008 compared to $12.9 billion at September 30, 2008. In the fourth quarter, commercial and commercial real estate loans decreased by $90.2 million and $133.0 million, respectively while consumer increased by $43.8 million. Residential mortgage loans declined by $499.4 million largely as a result of the aforementioned residential loan securitization undertaken during the fourth quarter. |
Deposits and borrowings
| • | Total deposits were $11.9 billion at December 31, 2008 compared to $11.8 billion at September 30, 2008. In the fourth quarter, consumer preferences shifted to certificates of deposits, savings accounts and NOW accounts as balances increased $184.8 million, $43.1 million and $61.6 million, respectively. Offsetting these increases were decreases in demand deposits and money market accounts of $16.0 million and $235.2 million, respectively. |
| • | Core deposits as a percent of total deposits was 59.0 percent at December 31, 2008 compared to 60.5 percent at the end of the third quarter and 59.5 percent a year ago. |
| • | Total borrowings were $3.6 billion, a decline of $107 million from $3.7 billion at September 30, 2008. |
***
Webster Financial Corporation is the holding company for Webster Bank, National Association. With $17.5 billion in assets, Webster provides business and consumer banking, mortgage, financial planning, trust and investment services through 181 banking offices, 489 ATMs, telephone banking and the Internet. Webster Bank owns the asset-based lending firm Webster Business Credit Corporation, the insurance premium finance company Budget Installment Corp., Center Capital Corporation, an equipment finance company headquartered in Farmington, Conn., and provides health savings account trustee and administrative services through HSA Bank, a division of Webster Bank. Member FDIC and equal housing lender. For more information about Webster, including past press releases and the latest annual report, visit the Webster website atwww.websteronline.com.
***
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Conference Call
A conference call covering Webster’s fourth quarter earnings announcement will be held today, Friday, January 23, at 9:00 a.m. EST and may be heard through Webster’s investor relations website atwww.wbst.com, or in listen-only mode by calling 1-877-407-8289 or 201-689-8341 internationally. The call will be archived on the website and available for future retrieval.
Forward-looking Statements
Statements in this press release regarding Webster Financial Corporation’s business that are not historical facts are “forward-looking statements” that involve risks and uncertainties. For a discussion of such risks and uncertainties that could cause actual results to differ from those contained in the forward-looking statement, see “Forward Looking Statements” in Webster’s Annual Report for 2007. Except as required by law, Webster does not undertake to update any such forward looking information.
Non-GAAP Financial Measures
In addition to results presented in accordance with GAAP, this press release contains certain non-GAAP financial measures. A reconciliation of net income and other performance ratios, as adjusted, is included in the accompanying selected financial highlights table.
We believe that providing certain non-GAAP financial measures provides investors with information useful in understanding our financial performance, our performance trends and financial position. Specifically, we provide measures based on what we believe are our operating earnings on a consistent basis and exclude non-core operating items which affect the GAAP reporting of results of operations. We utilize these measures for internal planning and forecasting purposes. We, as well as securities analysts, investors and other interested parties, also use these measures to compare peer company operating performance. We believe that our presentation and discussion, together with the accompanying reconciliations, provides a complete understanding of factors and trends affecting our business and allows investors to view performance in a manner similar to management. These non-GAAP measures should not be considered a substitute for GAAP basis measures and results and we strongly encourage investors to review our consolidated financial statements in their entirety and not to rely on any single financial measure. Because non-GAAP financial measures are not standardized, it may not be possible to compare these financial measures with other companies’ non-GAAP financial measures having the same or similar names.
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WEBSTER FINANCIAL CORPORATION
Selected Financial Highlights (unaudited)
| At or for the Three Months Ended December 31, | At or for the Twelve Months Ended December 31, | |||||||||||||||
(In thousands, except per share data) | 2008 | 2007 | 2008 | 2007 | ||||||||||||
Net income (loss) and performance ratios (annualized): | ||||||||||||||||
Net income (loss) | $ | (300,501 | ) | $ | (8,698 | ) | $ | (321,830 | ) | $ | 96,773 | |||||
Net income (loss) per diluted common share | (5.91 | ) | (0.16 | ) | (6.42 | ) | 1.76 | |||||||||
Return on average shareholders’ equity | (61.74 | )% | (1.95 | )% | (17.60 | )% | 5.22 | % | ||||||||
Return on average tangible equity | (99.52 | ) | (3.37 | ) | (29.76 | ) | 8.83 | |||||||||
Return on average assets | (6.87 | ) | (0.21 | ) | (1.86 | ) | 0.57 | |||||||||
Income (loss) from continuing operations and performance ratios (annualized): | ||||||||||||||||
Income (loss) from continuing operations | $ | (300,509 | ) | $ | 5,169 | $ | (318,757 | ) | $ | 110,696 | ||||||
Net income (loss) from continuing operations per diluted common share | (5.91 | ) | 0.10 | (6.36 | ) | 2.01 | ||||||||||
Return on average shareholders’ equity | (61.74 | )% | 1.16 | % | (17.43 | )% | 5.97 | % | ||||||||
Return on average tangible equity | (99.52 | ) | 2.00 | (29.48 | ) | 10.10 | ||||||||||
Return on average assets | (6.87 | ) | 0.12 | (1.84 | ) | 0.66 | ||||||||||
Noninterest income as a percentage of total revenue | (213.84 | ) | 28.14 | (5.87 | ) | 28.48 | ||||||||||
Efficiency ratio (a) | 59.08 | 62.88 | 62.51 | 61.98 | ||||||||||||
Asset quality: | ||||||||||||||||
Allowance for credit losses | $ | 245,829 | $ | 197,586 | $ | 245,829 | $ | 197,586 | ||||||||
Nonperforming assets | 263,189 | 121,072 | 263,189 | 121,072 | ||||||||||||
Allowance for credit losses / total loans | 2.02 | % | 1.58 | % | 2.02 | % | 1.58 | % | ||||||||
Net charge-offs / average loans (annualized) | 1.66 | 0.38 | 1.09 | 0.20 | ||||||||||||
Nonperforming loans / total loans | 1.91 | 0.90 | 1.91 | 0.90 | ||||||||||||
Nonperforming assets / total loans plus OREO | 2.15 | 0.97 | 2.15 | 0.97 | ||||||||||||
Allowance for credit losses / nonperforming loans | 105.70 | 175.01 | 105.70 | 175.01 | ||||||||||||
Other ratios (annualized): | ||||||||||||||||
Tangible capital ratio | 7.70 | % | 5.89 | % | 7.70 | % | 5.89 | % | ||||||||
Tangible common equity ratio | 4.08 | 5.89 | 4.08 | 5.89 | ||||||||||||
Total-risk based capital (d) | 15.20 | 11.39 | 15.20 | 11.39 | ||||||||||||
Shareholders’ equity / total assets | 10.66 | 10.10 | 10.66 | 10.10 | ||||||||||||
Interest-rate spread | 3.11 | 3.18 | 3.21 | 3.32 | ||||||||||||
Net interest margin | 3.20 | 3.26 | 3.28 | 3.40 | ||||||||||||
Share related: | ||||||||||||||||
Book value per common share | $ | 23.78 | $ | 33.09 | $ | 23.78 | $ | 33.09 | ||||||||
Tangible book value per common share | 13.35 | 18.73 | 13.35 | 18.73 | ||||||||||||
Common stock closing price | 13.78 | 31.97 | 13.78 | 31.97 | ||||||||||||
Dividends declared per common share | 0.30 | 0.30 | 1.20 | 1.17 | ||||||||||||
Common shares issued and outstanding | 52,884 | 52,475 | 52,884 | 52,475 | ||||||||||||
Basic shares (average) | 52,031 | 52,400 | 52,020 | 54,469 | ||||||||||||
Diluted shares (average) | 52,031 | 52,795 | 52,020 | 54,996 | ||||||||||||
Footnotes:
| (a) | Calculated using SNL’s methodology - noninterest expense (excluding foreclosed property expenses, intangible amortization, goodwill impairments and other charges) as a percentage of net interest income (FTE basis) plus noninterest income (excluding gain/loss on securities and other charges). |
| (b) | For purposes of the yield computation, unrealized gains (losses) on securities available for sale are excluded from the average balance. |
| (c) | NCLC is defined as National Construction Lending Center |
| (d) | The ratios presented are projected for the 2008 reporting periods and actual for the 2007 reporting periods. |
WEBSTER FINANCIAL CORPORATION
Consolidated Balance Sheet (unaudited)
(In thousands) | December 31, 2008 | September 30, 2008 | December 31, 2007 | |||||||||
Assets: | ||||||||||||
Cash and due from depository institutions | $ | 259,208 | $ | 221,195 | $ | 306,654 | ||||||
Short-term investments | 22,154 | 6,449 | 5,112 | |||||||||
Investment securities: | ||||||||||||
Trading, at fair value | 77 | 1,197 | 2,340 | |||||||||
Available for sale, at fair value | 1,188,705 | 824,118 | 639,364 | |||||||||
Held-to-maturity | 2,522,511 | 2,031,665 | 2,107,227 | |||||||||
Other securities | 134,874 | 134,874 | 110,962 | |||||||||
Total securities | 3,846,167 | 2,991,854 | 2,859,893 | |||||||||
Loans held for sale | 24,524 | 3,247 | 221,568 | |||||||||
Loans: | ||||||||||||
Residential mortgages | 3,068,441 | 3,567,825 | 3,641,602 | |||||||||
Commercial | 3,586,807 | 3,677,069 | 3,516,213 | |||||||||
Commercial real estate | 2,232,174 | 2,365,181 | 2,059,881 | |||||||||
Consumer | 3,300,169 | 3,256,314 | 3,258,247 | |||||||||
Total loans | 12,187,591 | 12,866,389 | 12,475,943 | |||||||||
Allowance for loan losses | (235,329 | ) | (189,169 | ) | (188,086 | ) | ||||||
Loans, net | 11,952,262 | 12,677,220 | 12,287,857 | |||||||||
Accrued interest receivable | 74,307 | 75,830 | 80,432 | |||||||||
Premises and equipment, net | 185,928 | 188,443 | 193,063 | |||||||||
Goodwill and other intangible assets, net | 563,926 | 754,026 | 768,015 | |||||||||
Cash surrender value of life insurance | 279,807 | 277,176 | 269,366 | |||||||||
Assets held for disposition | 5,571 | 900 | 51,603 | |||||||||
Unsettled trades | 105 | 68,996 | 2,308 | |||||||||
Deferred tax assets, net | 189,337 | 127,628 | 58,126 | |||||||||
Prepaid expenses and other assets | 180,241 | 123,073 | 97,963 | |||||||||
Total Assets | $ | 17,583,537 | $ | 17,516,037 | $ | 17,201,960 | ||||||
Liabilities and Shareholders’ Equity: | ||||||||||||
Deposits: | ||||||||||||
Demand deposits | $ | 1,493,295 | $ | 1,509,319 | $ | 1,538,083 | ||||||
NOW accounts | 1,802,250 | 1,740,650 | 1,718,757 | |||||||||
Money market deposit accounts | 1,356,361 | 1,591,599 | 1,828,656 | |||||||||
Savings accounts | 2,361,169 | 2,318,014 | 2,259,747 | |||||||||
Certificates of deposit | 4,677,615 | 4,492,767 | 4,772,624 | |||||||||
Brokered deposits | 194,200 | 180,026 | 236,291 | |||||||||
Total deposits | 11,884,890 | 11,832,375 | 12,354,158 | |||||||||
Securities sold under agreements to repurchase and other short-term debt | 1,570,971 | 1,688,728 | 1,238,012 | |||||||||
Federal Home Loan Bank advances | 1,335,996 | 1,355,931 | 1,052,228 | |||||||||
Long-term debt | 687,797 | 657,004 | 650,643 | |||||||||
Liabilities held for disposition | — | — | 9,261 | |||||||||
Accrued expenses and other liabilities | 220,187 | 155,853 | 151,449 | |||||||||
Total liabilities | 15,699,841 | 15,689,891 | 15,455,751 | |||||||||
Preferred stock of subsidiary corporation | 9,577 | 9,577 | 9,577 | |||||||||
Shareholders’ equity | 1,874,119 | 1,816,569 | 1,736,632 | |||||||||
Total Liabilities and Shareholders’ Equity | $ | 17,583,537 | $ | 17,516,037 | $ | 17,201,960 | ||||||
See Selected Financial Highlights for footnotes.
WEBSTER FINANCIAL CORPORATION
Consolidated Statements of Operations (unaudited)
| Three Months Ended December 31, | Twelve Months Ended December 31, | |||||||||||||||
(In thousands, except per share data) | 2008 | 2007 | 2008 | 2007 | ||||||||||||
Interest income: | ||||||||||||||||
Loans | $ | 168,200 | $ | 205,363 | $ | 710,621 | $ | 837,711 | ||||||||
Investment securities and short-term investments | 40,398 | 36,318 | 157,055 | 136,324 | ||||||||||||
Loans held for sale | 51 | 3,276 | 1,597 | 21,560 | ||||||||||||
Total interest income | 208,649 | 244,957 | 869,273 | 995,595 | ||||||||||||
Interest expense: | ||||||||||||||||
Deposits | 57,154 | 89,510 | 250,182 | 361,307 | ||||||||||||
Borrowings | 25,427 | 32,748 | 113,300 | 126,096 | ||||||||||||
Total interest expense | 82,581 | 122,258 | 363,482 | 487,403 | ||||||||||||
Net interest income | 126,068 | 122,699 | 505,791 | 508,192 | ||||||||||||
Provision for credit losses | 100,000 | 45,250 | 186,300 | 67,750 | ||||||||||||
Net interest income after provision for credit losses | 26,068 | 77,449 | 319,491 | 440,442 | ||||||||||||
Noninterest income: | ||||||||||||||||
Deposit service fees | 30,018 | 30,577 | 120,132 | 114,645 | ||||||||||||
Loan related fees | 7,147 | 7,328 | 29,067 | 30,830 | ||||||||||||
Wealth and investment services | 6,480 | 7,507 | 28,140 | 29,164 | ||||||||||||
Mortgage banking activities | 336 | 1,276 | 1,230 | 9,316 | ||||||||||||
Increase in cash surrender value of life insurance | 2,631 | 2,637 | 10,441 | 10,386 | ||||||||||||
Gain (loss) on sale of securities, net | (4,233 | ) | 195 | (4,034 | ) | 1,721 | ||||||||||
Other | 1,315 | 2,094 | 6,684 | 7,685 | ||||||||||||
| 43,694 | 51,614 | 191,660 | 203,747 | |||||||||||||
Loss on write-down of investments to fair value | (129,593 | ) | (3,565 | ) | (219,277 | ) | (3,565 | ) | ||||||||
Loss on sale of FNMA/FHLMC preferred stock | — | — | (2,060 | ) | — | |||||||||||
Visa share redemption | — | — | 1,625 | — | ||||||||||||
Gain on Webster Capital Trust I and II securities | — | — | — | 2,130 | ||||||||||||
Total noninterest income | (85,899 | ) | 48,049 | (28,052 | ) | 202,312 | ||||||||||
Noninterest expenses: | ||||||||||||||||
Compensation and benefits | 52,078 | 60,965 | 239,701 | 244,570 | ||||||||||||
Occupancy | 13,406 | 12,821 | 53,043 | 49,378 | ||||||||||||
Furniture and equipment | 15,469 | 15,353 | 61,155 | 59,771 | ||||||||||||
Intangible amortization | 1,463 | 1,881 | 5,939 | 10,374 | ||||||||||||
Marketing | 2,895 | 1,727 | 13,956 | 14,213 | ||||||||||||
Professional services | 4,101 | 3,721 | 15,758 | 15,038 | ||||||||||||
Foreclosed property expense | 3,414 | 1,634 | 8,943 | 2,010 | ||||||||||||
FDIC deposit insurance assessment | 3,468 | 357 | 4,698 | 1,520 | ||||||||||||
Other | 13,593 | 16,522 | 58,306 | 62,548 | ||||||||||||
| 109,887 | 114,981 | 461,499 | 459,422 | |||||||||||||
Debt redemption premium | — | — | — | 8,940 | ||||||||||||
Severance and other costs | 5,905 | 5,343 | 16,158 | 15,608 | ||||||||||||
Impairment of goodwill | 188,866 | — | 198,379 | — | ||||||||||||
Total noninterest expenses | 304,658 | 120,324 | 676,036 | 483,970 | ||||||||||||
Income (loss) from continuing operations before income taxes | (364,489 | ) | 5,174 | (384,597 | ) | 158,784 | ||||||||||
Income taxes (benefit) | (63,980 | ) | 5 | (65,840 | ) | 48,088 | ||||||||||
Income (loss) from continuing operations | (300,509 | ) | 5,169 | (318,757 | ) | 110,696 | ||||||||||
Income (loss) from discontinued operations, net of tax | 8 | (13,867 | ) | (3,073 | ) | (13,923 | ) | |||||||||
Net income (loss) | $ | (300,501 | ) | $ | (8,698 | ) | $ | (321,830 | ) | $ | 96,773 | |||||
Preferred stock dividends | 7,093 | — | 12,087 | — | ||||||||||||
Net income (loss) available to common shareholders | $ | (307,594 | ) | $ | (8,698 | ) | $ | (333,917 | ) | $ | 96,773 | |||||
Diluted shares (average) | 52,031 | 52,795 | 52,020 | 54,996 | ||||||||||||
Net income (loss) per common share: | ||||||||||||||||
Basic | ||||||||||||||||
Income (loss) from continuing operations | $ | (5.91 | ) | $ | 0.10 | $ | (6.36 | ) | $ | 2.03 | ||||||
Net income (loss) | (5.91 | ) | (0.17 | ) | (6.42 | ) | 1.78 | |||||||||
Diluted | ||||||||||||||||
Income (loss) from continuing operations | (5.91 | ) | 0.10 | (6.36 | ) | 2.01 | ||||||||||
Net income (loss) | (5.91 | ) | (0.16 | ) | (6.42 | ) | 1.76 | |||||||||
See Selected Financial Highlights for footnotes.
WEBSTER FINANCIAL CORPORATION
Five Quarter Consolidated Statements of Operations (unaudited)
| Three Months Ended | ||||||||||||||||||||
(In thousands, except per share data) | Dec. 31, 2008 | Sept. 30, 2008 | June 30, 2008 | March 31, 2008 | Dec. 31, 2007 | |||||||||||||||
Interest income: | ||||||||||||||||||||
Loans | $ | 168,200 | $ | 175,363 | $ | 175,786 | $ | 191,272 | $ | 205,363 | ||||||||||
Investment securities and short-term investments | 40,398 | 39,210 | 38,115 | 39,332 | 36,318 | |||||||||||||||
Loans held for sale | 51 | 54 | 92 | 1,400 | 3,276 | |||||||||||||||
Total interest income | 208,649 | 214,627 | 213,993 | 232,004 | 244,957 | |||||||||||||||
Interest expense: | ||||||||||||||||||||
Deposits | 57,154 | 57,730 | 60,056 | 75,242 | 89,510 | |||||||||||||||
Borrowings | 25,427 | 27,716 | 28,251 | 31,906 | 32,748 | |||||||||||||||
Total interest expense | 82,581 | 85,446 | 88,307 | 107,148 | 122,258 | |||||||||||||||
Net interest income | 126,068 | 129,181 | 125,686 | 124,856 | 122,699 | |||||||||||||||
Provision for credit losses | 100,000 | 45,500 | 25,000 | 15,800 | 45,250 | |||||||||||||||
Net interest income after provision for credit losses | 26,068 | 83,681 | 100,686 | 109,056 | 77,449 | |||||||||||||||
Noninterest income: | ||||||||||||||||||||
Deposit service fees | 30,018 | 31,738 | 29,943 | 28,433 | 30,577 | |||||||||||||||
Loan related fees | 7,147 | 7,171 | 7,891 | 6,858 | 7,328 | |||||||||||||||
Wealth and investment services | 6,480 | 7,070 | 7,634 | 6,956 | 7,507 | |||||||||||||||
Mortgage banking activities | 336 | 50 | 104 | 740 | 1,276 | |||||||||||||||
Increase in cash surrender value of life insurance | 2,631 | 2,606 | 2,623 | 2,581 | 2,637 | |||||||||||||||
Gain (loss) on sale of securities, net | (4,233 | ) | (50 | ) | 126 | 123 | 195 | |||||||||||||
Other | 1,315 | 2,731 | 854 | 1,784 | 2,094 | |||||||||||||||
| 43,694 | 51,316 | 49,175 | 47,475 | 51,614 | ||||||||||||||||
Loss on write-down of investments to fair value | (129,593 | ) | (33,507 | ) | (54,924 | ) | (1,253 | ) | (3,565 | ) | ||||||||||
Loss on sale of FNMA/FHLMC preferred stock | — | (2,060 | ) | — | — | — | ||||||||||||||
VISA share redemption | — | — | — | 1,625 | — | |||||||||||||||
Total noninterest income | (85,899 | ) | 15,749 | (5,749 | ) | 47,847 | 48,049 | |||||||||||||
Noninterest expenses: | ||||||||||||||||||||
Compensation and benefits | 52,078 | 61,314 | 62,866 | 63,443 | 59,910 | |||||||||||||||
Occupancy | 13,406 | 12,827 | 13,128 | 13,682 | 12,321 | |||||||||||||||
Furniture and equipment | 15,469 | 14,892 | 15,634 | 15,160 | 15,353 | |||||||||||||||
Intangible amortization | 1,463 | 1,464 | 1,464 | 1,548 | 1,881 | |||||||||||||||
Marketing | 2,895 | 2,478 | 4,940 | 3,643 | 1,727 | |||||||||||||||
Professional services | 4,101 | 3,798 | 3,706 | 4,153 | 3,721 | |||||||||||||||
Foreclosed property expense | 3,414 | 3,464 | 1,552 | 513 | 1,634 | |||||||||||||||
FDIC deposit insurance assessment | 3,468 | 532 | 344 | 354 | 357 | |||||||||||||||
Other | 13,593 | 14,227 | 16,221 | 14,265 | 16,522 | |||||||||||||||
| 109,887 | 114,996 | 119,855 | 116,761 | 113,426 | ||||||||||||||||
Severance and other costs | 5,905 | 1,535 | 9,368 | (650 | ) | 6,898 | ||||||||||||||
Impairment of goodwill | 188,866 | 1,013 | 8,500 | — | — | |||||||||||||||
Total noninterest expenses | 304,658 | 117,544 | 137,723 | 116,111 | 120,324 | |||||||||||||||
Income (loss) from continuing operations before income taxes | (364,489 | ) | (18,114 | ) | (42,786 | ) | 40,792 | 5,174 | ||||||||||||
Income taxes (benefit) | (63,980 | ) | (1,878 | ) | (14,285 | ) | 14,303 | 5 | ||||||||||||
Income (loss) from continuing operations | (300,509 | ) | (16,236 | ) | (28,501 | ) | 26,489 | 5,169 | ||||||||||||
Income (loss) from discontinued operations, net of tax | 8 | (518 | ) | (439 | ) | (2,124 | ) | (13,867 | ) | |||||||||||
Net income (loss) | $ | (300,501 | ) | $ | (16,754 | ) | $ | (28,940 | ) | $ | 24,365 | $ | (8,698 | ) | ||||||
Preferred stock dividends | 7,093 | 4,994 | — | — | — | |||||||||||||||
Net income (loss) available to common shareholders | $ | (307,594 | ) | $ | (21,748 | ) | $ | (28,940 | ) | $ | 24,365 | $ | (8,698 | ) | ||||||
Diluted shares (average) | 52,031 | 52,032 | 52,017 | 52,297 | 52,795 | |||||||||||||||
Net income (loss) per common share: | ||||||||||||||||||||
Basic | ||||||||||||||||||||
Income (loss) from continuing operations | $ | (5.91 | ) | $ | (0.41 | ) | $ | (0.55 | ) | $ | 0.51 | $ | 0.10 | |||||||
Net income (loss) | (5.91 | ) | (0.42 | ) | (0.56 | ) | 0.47 | (0.17 | ) | |||||||||||
Diluted | ||||||||||||||||||||
Income (loss) from continuing operations | (5.91 | ) | (0.41 | ) | (0.55 | ) | 0.51 | 0.10 | ||||||||||||
Net income (loss) | (5.91 | ) | (0.42 | ) | (0.56 | ) | 0.47 | (0.16 | ) | |||||||||||
See Selected Financial Highlights for footnotes.
WEBSTER FINANCIAL CORPORATION
Five Quarter Interest-Rate Spreads (unaudited)
| Three Months Ended | |||||||||||||||
| December 31, 2008 | September 30, 2008 | June 30, 2008 | March 31, 2008 | December 31, 2007 | |||||||||||
Interest-rate spread | |||||||||||||||
Yield on interest-earning assets | 5.24 | % | 5.45 | % | 5.51 | % | 6.02 | % | 6.42 | % | |||||
Cost of interest-bearing liabilities | 2.13 | 2.21 | 2.31 | 2.82 | 3.24 | ||||||||||
Interest-rate spread | 3.11 | % | 3.24 | % | 3.20 | % | 3.20 | % | 3.18 | % | |||||
Net interest margin | 3.20 | % | 3.32 | % | 3.26 | % | 3.27 | % | 3.26 | % | |||||
Consolidated Average Balances, Yields and Rates Paid (unaudited)
Three Months Ended December 31, | 2008 | 2007 | ||||||||||||||||||
(Dollars in thousands) | Average balance | Interest | Fully tax- equivalent yield/rate | Average balance | Interest | Fully tax- equivalent yield/rate | ||||||||||||||
Assets: | ||||||||||||||||||||
Interest-earning assets: | ||||||||||||||||||||
Loans | $ | 12,769,534 | $ | 168,200 | 5.22 | % | $ | 12,422,076 | $ | 205,363 | 6.54 | % | ||||||||
Investment securities (b) | 3,135,069 | 44,114 | 5.34 | 2,672,421 | 39,329 | 5.85 | ||||||||||||||
Loans held for sale | 4,093 | 51 | 4.99 | 208,199 | 3,276 | 6.29 | ||||||||||||||
Short-term investments | 11,399 | 40 | 1.38 | 18,464 | 132 | 2.79 | ||||||||||||||
Total interest-earning assets | 15,920,095 | 212,405 | 5.24 | 15,321,160 | 248,100 | 6.42 | ||||||||||||||
Noninterest-earning assets | 1,570,208 | 1,564,878 | ||||||||||||||||||
Total assets | $ | 17,490,303 | $ | 16,886,038 | ||||||||||||||||
Liabilities and Shareholders’ Equity: | ||||||||||||||||||||
Interest-bearing liabilities: | ||||||||||||||||||||
Demand deposits | $ | 1,510,066 | $ | — | — | % | $ | 1,492,936 | $ | — | — | % | ||||||||
Savings, NOW and money market deposit accounts | 5,550,224 | 17,849 | 1.28 | 5,795,625 | 31,608 | 2.16 | ||||||||||||||
Time deposits | 4,823,332 | 39,305 | 3.24 | 5,104,534 | 57,902 | 4.50 | ||||||||||||||
Total deposits | 11,883,622 | 57,154 | 1.91 | 12,393,095 | 89,510 | 2.86 | ||||||||||||||
Securities sold under agreements to repurchase and other short-term debt | 1,446,049 | 6,345 | 1.72 | 1,072,976 | 11,560 | 4.22 | ||||||||||||||
Federal Home Loan Bank advances | 1,384,706 | 8,630 | 2.44 | 797,713 | 8,812 | 4.32 | ||||||||||||||
Long-term debt | 665,382 | 10,452 | 6.28 | 662,904 | 12,376 | 7.47 | ||||||||||||||
Total borrowings | 3,496,137 | 25,427 | 2.87 | 2,533,593 | 32,748 | 5.10 | ||||||||||||||
Total interest-bearing liabilities | 15,379,759 | 82,581 | 2.13 | 14,926,688 | 122,258 | 3.24 | ||||||||||||||
Noninterest-bearing liabilities | 154,048 | 161,761 | ||||||||||||||||||
Total liabilities | 15,533,807 | 15,088,449 | ||||||||||||||||||
Preferred stock of subsidiary corporation | 9,577 | 9,577 | ||||||||||||||||||
Shareholders’ equity | 1,946,919 | 1,788,012 | ||||||||||||||||||
Total liabilities and shareholders’ equity | $ | 17,490,303 | $ | 16,886,038 | ||||||||||||||||
Tax-equivalent net interest income | 129,824 | 125,842 | ||||||||||||||||||
Less: tax-equivalent adjustment | (3,756 | ) | (3,143 | ) | ||||||||||||||||
Net interest income | $ | 126,068 | $ | 122,699 | ||||||||||||||||
Interest-rate spread | 3.11 | % | 3.18 | % | ||||||||||||||||
Net interest margin | 3.20 | % | 3.26 | % | ||||||||||||||||
See Selected Financial Highlights for footnotes.
WEBSTER FINANCIAL CORPORATION
Consolidated Average Balances, Yields and Rates Paid (unaudited)
Twelve Months Ended December 31, | 2008 | 2007 | ||||||||||||||||||
(Dollars in thousands) | Average balance | Interest | Fully tax- equivalent yield/rate | Average balance | Interest | Fully tax- equivalent yield/rate | ||||||||||||||
Assets: | ||||||||||||||||||||
Interest-earning assets: | ||||||||||||||||||||
Loans | $ | 12,700,933 | $ | 710,621 | 5.60 | % | $ | 12,390,955 | $ | 837,711 | 6.76 | % | ||||||||
Investment securities (b) | 3,023,039 | 171,813 | 5.51 | 2,470,400 | 144,352 | 5.79 | ||||||||||||||
Loans held for sale | 27,366 | 1,597 | 5.83 | 344,663 | 21,560 | 6.26 | ||||||||||||||
Short-term investments | 6,422 | 146 | 2.27 | 59,345 | 3,045 | 5.13 | ||||||||||||||
Total interest-earning assets | 15,757,760 | 884,177 | 5.58 | 15,265,363 | 1,006,668 | 6.60 | ||||||||||||||
Noninterest-earning assets | 1,546,699 | 1,590,282 | ||||||||||||||||||
Total assets | $ | 17,304,459 | $ | 16,855,645 | ||||||||||||||||
Liabilities and Shareholders’ Equity: | ||||||||||||||||||||
Interest-bearing liabilities: | ||||||||||||||||||||
Demand deposits | $ | 1,487,661 | $ | — | — | % | $ | 1,506,696 | $ | — | — | |||||||||
Savings, NOW and money market deposit accounts | 5,776,660 | 80,994 | 1.40 | 5,749,378 | 125,590 | 2.18 | ||||||||||||||
Time deposits | 4,764,386 | 169,188 | 3.55 | 5,218,449 | 235,717 | 4.52 | ||||||||||||||
Total deposits | 12,028,707 | 250,182 | 2.08 | 12,474,523 | 361,307 | 2.90 | ||||||||||||||
Securities sold under agreements to repurchase and other short-term debt | 1,359,318 | 34,643 | 2.55 | 996,341 | 44,769 | 4.49 | ||||||||||||||
Federal Home Loan Bank advances | 1,269,098 | 39,236 | 3.09 | 757,367 | 35,302 | 4.66 | ||||||||||||||
Long-term debt | 660,146 | 39,421 | 5.97 | 609,371 | 46,025 | 7.55 | ||||||||||||||
Total borrowings | 3,288,562 | 113,300 | 3.45 | 2,363,079 | 126,096 | 5.34 | ||||||||||||||
Total interest-bearing liabilities | 15,317,269 | 363,482 | 2.37 | 14,837,602 | 487,403 | 3.28 | ||||||||||||||
Noninterest-bearing liabilities | 149,236 | 156,083 | ||||||||||||||||||
Total liabilities | 15,466,505 | 14,993,685 | ||||||||||||||||||
Preferred stock of subsidiary corporation | 9,577 | 9,577 | ||||||||||||||||||
Shareholders’ equity | 1,828,377 | 1,852,383 | ||||||||||||||||||
Total liabilities and shareholders’ equity | $ | 17,304,459 | $ | 16,855,645 | ||||||||||||||||
| 520,695 | 519,265 | |||||||||||||||||||
Less: tax-equivalent adjustment | (14,904 | ) | (11,073 | ) | ||||||||||||||||
Net interest income | $ | 505,791 | $ | 508,192 | ||||||||||||||||
Interest-rate spread | 3.21 | % | 3.32 | % | ||||||||||||||||
Net interest margin | 3.28 | % | 3.40 | % | ||||||||||||||||
See Selected Financial Highlights for footnotes.
WEBSTER FINANCIAL CORPORATION
Five Quarter Nonperforming Assets(unaudited)
(Dollars in thousands) | Dec. 31, 2008 | Sept. 30, 2008 | June 30, 2008 | March 31, 2008 | Dec. 31, 2007 | ||||||||||
Nonperforming loans: | |||||||||||||||
Continuing Portfolio: | |||||||||||||||
Commercial: | |||||||||||||||
Commercial | $ | 49,987 | $ | 51,081 | $ | 55,788 | $ | 30,264 | $ | 26,804 | |||||
Equipment financing | 13,138 | 7,462 | 6,718 | 5,719 | 6,473 | ||||||||||
Total commercial | 63,125 | 58,543 | 62,506 | 35,983 | 33,277 | ||||||||||
Commercial real estate | 8,032 | 8,971 | 9,710 | 7,809 | 8,523 | ||||||||||
Residential development | 48,628 | 71,065 | 48,130 | 13,402 | 4,373 | ||||||||||
Residential: | |||||||||||||||
Residential construction to permanent | 10,896 | 8,189 | 6,660 | 4,200 | 2,820 | ||||||||||
All other | 37,385 | 27,992 | 19,633 | 22,042 | 19,532 | ||||||||||
Total residential | 48,281 | 36,181 | 26,293 | 26,242 | 22,352 | ||||||||||
Consumer | 29,939 | 23,668 | 20,745 | 17,084 | 14,455 | ||||||||||
Nonperforming loans - continuing portfolio | 198,005 | 198,428 | 167,384 | 100,520 | 82,980 | ||||||||||
Liquidating Portfolio: | |||||||||||||||
NCLC(c) | 17,623 | 17,491 | 29,025 | 29,804 | 22,797 | ||||||||||
Consumer | 16,938 | 10,994 | 10,651 | 9,378 | 7,126 | ||||||||||
Nonperforming loans - liquidating portfolio | 34,561 | 28,485 | 39,676 | 39,182 | 29,923 | ||||||||||
Total nonperforming loans | 232,566 | 226,913 | 207,060 | 139,702 | 112,903 | ||||||||||
Other real estate owned and repossessed assets: | |||||||||||||||
Commercial | 22,868 | 13,287 | 6,776 | 6,590 | 2,211 | ||||||||||
Residential | 5,382 | 6,014 | 4,071 | 1,820 | 1,062 | ||||||||||
Consumer | 2,373 | 3,461 | 6,193 | 5,872 | 4,896 | ||||||||||
Total other real estate owned and repossessed assets | 30,623 | 22,762 | 17,040 | 14,282 | 8,169 | ||||||||||
Total nonperforming assets | $ | 263,189 | $ | 249,675 | $ | 224,100 | $ | 153,984 | $ | 121,072 | |||||
Accruing loans 90 or more days past due | $ | 1,110 | $ | 708 | $ | 1,380 | $ | 1,032 | $ | 1,891 | |||||
See Selected Financial Highlights for footnotes.
WEBSTER FINANCIAL CORPORATION
Five Quarter Past Due Loans(unaudited)
(Dollars in thousands) | Dec. 31, 2008 | Sept. 30, 2008 | June 30, 2008 | March 31, 2008 | Dec. 31, 2007 | ||||||||||
Past Due 30-89 days: | |||||||||||||||
Continuing Portfolio: | |||||||||||||||
Commercial: | |||||||||||||||
Commercial | $ | 19,493 | $ | 7,196 | $ | 8,337 | $ | 10,229 | $ | 13,291 | |||||
Equipment financing | 9,860 | 8,102 | 9,414 | 10,269 | 5,644 | ||||||||||
Total commercial | 29,353 | 15,298 | 17,751 | 20,498 | 18,935 | ||||||||||
Commercial real estate | 7,158 | 18,241 | 2,756 | 24,655 | 8,178 | ||||||||||
Residential development | 2,096 | 5,832 | 2,485 | 5,999 | 3,876 | ||||||||||
Residential: | |||||||||||||||
Residential construction to permanent | 3,934 | 4,156 | 1,914 | 3,339 | 3,743 | ||||||||||
All other | 41,048 | 35,341 | 24,621 | 22,295 | 19,967 | ||||||||||
Total residential | 44,982 | 39,497 | 26,535 | 25,634 | 23,710 | ||||||||||
Consumer | 33,848 | 23,279 | 18,137 | 20,721 | 22,347 | ||||||||||
Past Due 30-89 days - continuing portfolio | 117,437 | 102,147 | 67,664 | 97,507 | 77,046 | ||||||||||
Liquidating Portfolio: | |||||||||||||||
NCLC(c) | 5,414 | 3,758 | 3,486 | 4,983 | 13,143 | ||||||||||
Consumer | 15,621 | 15,370 | 8,063 | 10,473 | 8,793 | ||||||||||
Past Due 30-89 days - liquidating portfolio | 21,035 | 19,128 | 11,549 | 15,456 | 21,936 | ||||||||||
Past Due 90 days or more: | |||||||||||||||
Commercial | 459 | 534 | 1,380 | 596 | 1,141 | ||||||||||
Commercial real estate | 450 | 174 | — | — | 550 | ||||||||||
Residential development | 201 | — | — | 436 | 200 | ||||||||||
Past Due 90 days or more | 1,110 | 708 | 1,380 | 1,032 | 1,891 | ||||||||||
Total | $ | 139,582 | $ | 121,983 | $ | 80,593 | $ | 113,995 | $ | 100,873 | |||||
See Selected Financial Highlights for footnotes.
WEBSTER FINANCIAL CORPORATION
Five Quarter Changes in the Allowance for Credit Losses(unaudited)
| For the Three Months Ended | ||||||||||||||||||||
(Dollars in thousands) | Dec. 31, 2008 | Sept. 30, 2008 | June 30, 2008 | March 31, 2008 | Dec. 31, 2007 | |||||||||||||||
Beginning balance | $ | 198,669 | $ | 194,368 | $ | 189,808 | $ | 197,586 | $ | 164,011 | ||||||||||
Provision | 100,000 | 45,500 | 25,000 | 15,800 | 45,250 | |||||||||||||||
Charge-offs continuing portfolio: | ||||||||||||||||||||
Commercial | 5,641 | 13,837 | 3,903 | 10,949 | 2,182 | |||||||||||||||
Equipment financing | 1,222 | 998 | 672 | 490 | 303 | |||||||||||||||
Commercial real estate | 253 | — | 378 | — | — | |||||||||||||||
Residential development | 29,909 | 161 | 3,711 | — | — | |||||||||||||||
Residential | 3,037 | 1,624 | 1,036 | 1,480 | 71 | |||||||||||||||
Consumer | 3,887 | 4,643 | 2,784 | 3,697 | 1,833 | |||||||||||||||
Charge-offs continuing portfolio: | 43,949 | 21,263 | 12,484 | 16,616 | 4,389 | |||||||||||||||
Recoveries | (796 | ) | (714 | ) | (1,290 | ) | (827 | ) | (1,611 | ) | ||||||||||
Net loan charge-offs | 43,153 | 20,549 | 11,194 | 15,789 | 2,778 | |||||||||||||||
Charge-offs liquidating portfolio: | ||||||||||||||||||||
NCLC(c) | 1,518 | 14,025 | 4,203 | 4,341 | 7,051 | |||||||||||||||
Consumer | 8,779 | 6,767 | 5,450 | 3,448 | 1,846 | |||||||||||||||
Charge-offs liquidating portfolio: | 10,297 | 20,792 | 9,653 | 7,789 | 8,897 | |||||||||||||||
Recoveries | (610 | ) | (142 | ) | (407 | ) | — | — | ||||||||||||
Net loan charge-offs | 9,687 | 20,650 | 9,246 | 7,789 | 8,897 | |||||||||||||||
Total net charge-offs | 52,840 | 41,199 | 20,440 | 23,578 | 11,675 | |||||||||||||||
Ending balance | $ | 245,829 | $ | 198,669 | $ | 194,368 | $ | 189,808 | $ | 197,586 | ||||||||||
Components: | ||||||||||||||||||||
Allowance for loan losses | $ | 235,329 | $ | 189,169 | $ | 184,868 | $ | 180,308 | $ | 188,086 | ||||||||||
Reserve for unfunded credit commitments | 10,500 | 9,500 | 9,500 | 9,500 | 9,500 | |||||||||||||||
Allowance for credit losses | $ | 245,829 | $ | 198,669 | $ | 194,368 | $ | 189,808 | $ | 197,586 | ||||||||||
Asset Quality Ratios: | ||||||||||||||||||||
Allowance for loan losses / total loans | 1.93 | % | 1.47 | % | 1.45 | % | 1.43 | % | 1.51 | % | ||||||||||
Allowance for credit losses / total loans | 2.02 | 1.54 | 1.52 | 1.51 | 1.58 | |||||||||||||||
Net charge-offs / average loans (annualized) | 1.66 | 1.29 | 0.64 | 0.75 | 0.38 | |||||||||||||||
Nonperforming loans / total loans | 1.91 | 1.76 | 1.62 | 1.11 | 0.90 | |||||||||||||||
Nonperforming assets / total loans plus OREO | 2.15 | 1.94 | 1.75 | 1.22 | 0.97 | |||||||||||||||
Allowance for credit losses / nonperforming loans | 105.70 | 87.55 | 93.87 | 135.87 | 175.01 | |||||||||||||||
Continuing Portfolio | ||||||||||||||||||||
Allowance for loan losses / total loans | 1.62 | % | 1.29 | % | 1.23 | % | 1.13 | % | 1.15 | |||||||||||
Allowance for credit losses / total loans | 1.71 | 1.36 | 1.30 | 1.21 | 1.23 | |||||||||||||||
Net charge-offs / average loans (annualized) | 1.39 | 0.66 | 0.36 | 0.52 | 0.09 | |||||||||||||||
Nonperforming loans / total loans | 1.67 | 1.58 | 1.35 | 0.82 | 0.69 | |||||||||||||||
Nonperforming assets / total loans plus OREO | 1.88 | 1.73 | 1.47 | 0.93 | 0.76 | |||||||||||||||
Allowance for credit losses / nonperforming loans | 102.35 | 86.09 | 96.48 | 146.92 | 177.98 | |||||||||||||||
Liquidating Portfolio | ||||||||||||||||||||
NCLC | ||||||||||||||||||||
Allowance for loan losses / total loans | 13.56 | % | 14.01 | % | 14.26 | % | 18.77 | % | 20.65 | |||||||||||
Net charge-offs / average loans (annualized) | 8.96 | 92.69 | 23.00 | 25.78 | 25.43 | |||||||||||||||
Nonperforming loans / total loans | 48.94 | 42.20 | 45.68 | 43.49 | 27.37 | |||||||||||||||
Allowance for loan losses / nonperforming loans | 27.70 | 33.19 | 31.22 | 43.15 | 75.45 | |||||||||||||||
Consumer | ||||||||||||||||||||
Allowance for loan losses / total loans | 13.50 | % | 7.45 | % | 7.53 | % | 8.96 | % | 9.60 | |||||||||||
Net charge-offs / average loans (annualized) | 11.93 | 8.81 | 6.75 | 4.20 | 2.17 | |||||||||||||||
Nonperforming loans / total loans | 5.97 | 3.72 | 3.37 | 2.87 | 2.09 | |||||||||||||||
Allowance for loan losses / nonperforming loans | 225.99 | 200.5 | 223.63 | 312.09 | 458.88 | |||||||||||||||
See Selected Financial Highlights for footnotes.