Exhibit 99.1
| | |
Media Contact Ed Steadham 203-578-2287 esteadham@websterbank.com | | Investor Contact Terry Mangan 203-578-2318 tmangan@websterbank.com |
WEBSTER REPORTS FOURTH QUARTER RESULTS
WATERBURY, Conn., January 22, 2010 – Webster Financial Corporation (NYSE: WBS), the holding company for Webster Bank, N.A., today announced a consolidated net loss of $13.7 million for the quarter ended December 31, 2009. The net loss available to common shareholders of $54.4 million for the quarter ended December 31, 2009 included $34 million of imputed dividends related to the Warburg Pincus investment and convertible preferred exchanges completed during the quarter, which did not have any effect on capital levels at year end.
Key points for the quarter:
Increased core pre-tax, pre-provision earnings of $57.4 million compared to $56.1 million for the third quarter.
Increased tangible common equity by $71 million with completion of the Warburg Pincus investment; also bolstered common equity by exchanging common stock for $27 million par amount of outstanding Webster convertible preferred stock.
Reduced levels of provision for loan losses and net charge-offs of $67.0 million and $51.8 million, respectively, compared to $85.0 million and $64.6 million in the third quarter.
Improved net interest margin of 3.26 percent compared to 3.18 percent for the third quarter of 2009.
Improved core to total deposit ratio of 71 percent compared to 69 percent at September 30, 2009, reflecting core deposit growth of $394 million.
Improved loan-to-deposit ratio of 81 percent compared to 83 percent at September 30, 2009.
Webster Chairman and Chief Executive Officer James C. Smith said, “The fourth quarter was marked by many significant improvements in Webster’s operating fundamentals, especially as seen in stabilizing and improved credit metrics, including lower delinquencies, a reduced provision for losses, lower net charge-offs, and higher loan loss coverage. Other positive trends include improved earnings before loan loss provision, expanded net interest margin, and continuing strong core deposit growth. While our results do not yet reflect a return to profitability, our solid performance and improving trends are encouraging. Our recently announced lending and hiring initiatives reflect our positive outlook for continuing improvement throughout 2010.”
Net interest income
| | • | | Net interest margin improved to 3.26 percent in the fourth quarter with the increase reflecting an 18 basis point decline in the cost of funds offsetting a 10 basis point decline in the yield on interest-earning assets. |
| | • | | Average interest-earning assets totaled $16.35 billion, up from $16.25 billion last quarter. |
Provision for credit losses
| | • | | $62.2 million of the $67.0 million provision for credit losses recorded in the fourth quarter was related to the Company’s continuing portfolios, and $4.8 million of the provision for credit losses was related to the discontinued liquidating portfolio. |
| | • | | Net charge-offs were $51.8 million in the fourth quarter compared to $64.6 million for the quarter ended September 30, 2009; $43.2 million was related to the continuing portfolios compared to $51.4 million in the third quarter and $8.5 million was related to the discontinued liquidating portfolio compared to $13.2 million in the third quarter. |
Noninterest income
| | • | | Noninterest income includes a net gain on sale of investment securities of $53,000 compared to a net loss of $4.7 million in the third quarter. Fourth quarter results also include a net gain of $3.6 million on the fair value accounting mark on warrants issued in connection with the Warburg Pincus investment. |
Noninterest expenses
| | • | | Noninterest expenses, inclusive of severance and other one-time costs, increased $5.1 million from the third quarter. The fourth quarter included $6.5 million in severance and other one-time costs while the third quarter included $4.2 million in such charges. Included in the $6.5 million in severance and other costs were $3.7 million in facilities related charges, reflecting actions towards full consolidation of back office facilities, and $1.1 million in fraud related expense. Foreclosed and repossessed asset write-downs of $2.7 million and $2.2 million are also included in noninterest expenses in the respective periods. |
Income taxes
| | • | | Due to the pre-tax loss, the effective tax rate for the fourth quarter was not meaningful. The Company recorded a $1.6 million tax benefit in the quarter on the $15.3 million pre-tax loss applicable to continuing operations in the period. |
Investment securities
| | • | | Total investment securities were $4.8 billion at December 31, 2009 compared to $4.6 billion at September 30, 2009. The carrying value of the available for sale portfolio included $3 million in net unrealized losses compared to net unrealized losses of $4 million at September 30, 2009, while the carrying value of the held to maturity portfolio does not reflect $61 million in net unrealized gains compared to net unrealized gains of $103 million at September 30, 2009. |
Loans
| | • | | Total loans were $11.0 billion at December 31, 2009 compared to $11.3 billion at September 30, 2009. In the fourth quarter, residential mortgage loans increased by $60.6 million while consumer, commercial and commercial real estate loans declined by $74.2 million, $239.2 million and $32.8 million, respectively. The decline in commercial loans reflects reductions of $72.2 million in asset based loans and $53.7 million in equipment finance loans, as well as the sale of the insurance premium finance subsidiary in the quarter which had $93.5 million in loans at September 30, 2009. |
| | • | | The discontinued liquidating portfolio of indirect home equity and national construction loans, included in the consumer and residential loan portfolios, declined by $13.2 million from September 30, 2009 to $219.1 million and $4.8 million, respectively. |
Asset quality
| | • | | Total nonperforming loans were $373.0 million or 3.38 percent of total loans at December 31, 2009 compared to $361.1 million or 3.19 percent at September 30, 2009. The increase in nonperforming loans reflects a combined increase of $19.9 million in non-accrual commercial real estate, residential development and asset based lending loans and a combined decrease of $8.0 million in all other loan categories. |
| | • | | Past due loans for the continuing portfolios decreased to $90.5 million at December 31, 2009 compared to $114.9 million at September 30, 2009. Past due loans for the liquidating portfolio decreased to $10.4 million at December 31, 2009 compared to $12.6 million at September 30, 2009. |
Deposits and borrowings
| | • | | Total deposits were $13.6 billion at December 31, 2009 compared to the same amount at September 30, 2009. The core categories of demand, NOW, money market and savings increased by a combined amount of $393.8 million while certificates of deposit and brokered deposits decreased by $317.9 million and $44.5 million, respectively. |
| | • | | Total borrowings were $2.0 billion, a decline of $134.9 million from $2.1 billion at September 30, 2009 primarily from maturities of FHLB advances of $118.6 million in the quarter. Borrowings represented 11.2 percent of total assets at December 31, 2009 compared to 11.9 percent at September 30, 2009. |
***
Webster Financial Corporation is the holding company for Webster Bank, National Association. With $17.7 billion in assets, Webster provides business and consumer banking, mortgage, financial planning, trust and investment services through 181 banking offices, 501 ATMs, telephone banking and the Internet. Webster Bank owns the asset-based lending firm Webster Business Credit Corporation, 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.
***
Conference Call
A conference call covering Webster’s fourth quarter earnings announcement will be held today, Friday, January 22, at 9:00 a.m. EST and may be heard through Webster’s investor relations website at www.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
This release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 (the “Act”). Forward-looking statements can be identified by words such as “believes”, “anticipates”, “expects”, “intends”, “targeted”, “continue”, “remain”, “will”, “should”, “may”, “plans”, “estimates” and similar references to future periods, however such words are not the exclusive means of identifying such statements. Examples of forward-looking statements include, but are not limited to: (i) projections of revenues, expenses, income or loss, earnings or loss per share, and other financial items; (ii) statements of plans, objectives and expectations of Webster or its management or Board of Directors; (iii) statements of future economic performance; and (iv) statements of assumptions underlying such statements. Forward-looking statements are based on Webster’s current expectations and assumptions regarding its business, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict. Webster’s actual results may differ materially from those contemplated by the forward-looking statements, which are neither statements of historical fact nor guarantees or assurances of future performance. Factors that could cause actual results to differ from those discussed in the forward-looking statements include, but are not limited to: (1) local, regional, national and international economic conditions; (2) government intervention in the U.S. financial system; (3) changes in the level of non-performing assets and charge-offs; (4) inflation, interest rate, securities market and monetary fluctuations, and management’s estimates and projections of such fluctuations; (5) the timely development and acceptance of new products and services and perceived overall value of these products and services by users; (6) changes in management’s estimate of the adequacy of the allowance for loan losses; (7) the risks associated with the continued diversification of assets and adverse changes to credit quality; (8) technological changes; (9) the Company’s ability to increase market share and control expenses; (10) changes in laws, regulations and policies (including tax, banking, securities and insurance laws, regulations and policies); (11) changes in applicable accounting policies and practice; (12) legal and regulatory developments including the resolution of legal proceedings or regulatory or other governmental inquiries and the results of regulatory examinations or reviews; (13) the Company’s success at managing the risks involved in the foregoing items; and (14) the other factors that are described in the Company’s Annual Report on Form 10-K under the heading “Risk Factors.” Any forward-looking statement made by the Company in this release speaks only as of the date on which it is made. Factors or events that could cause the Company’s actual results to differ may emerge from time to time, and it is not possible for the Company to predict all of them. The Company undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future developments or otherwise, except as may be required by law.
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.
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) | | 2009 | | | 2008 | | | 2009 | | | 2008 | |
| | | | |
Net loss and performance ratios (annualized): | | | | | | | | | | | | | | | | |
| | | | |
Net loss | | $ | (13,696 | ) | | $ | (300,286 | ) | | $ | (75,632 | ) | | $ | (320,970 | ) |
Net loss per diluted common share | | | (0.84 | ) | | | (5.91 | ) | | | (2.14 | ) | | | (6.42 | ) |
Return on average shareholders’ equity | | | (2.81 | )% | | | (61.69 | )% | | | (4.02 | )% | | | (17.55 | )% |
Return on average tangible equity | | | (3.91 | ) | | | (99.44 | ) | | | (5.68 | ) | | | (29.68 | ) |
Return on average assets | | | (0.31 | ) | | | (6.87 | ) | | | (0.43 | ) | | | (1.85 | ) |
| | | | |
Loss from continuing operations and performance ratios (annualized): | | | | | | | | | | | | | | | | |
| | | | |
Loss from continuing operations attributable to Webster Financial Corporation | | $ | (13,685 | ) | | $ | (300,294 | ) | | $ | (75,934 | ) | | $ | (317,897 | ) |
Net loss from continuing operations per diluted common share | | | (0.84 | ) | | | (5.91 | ) | | | (2.15 | ) | | | (6.36 | ) |
Return on average shareholders’ equity | | | (2.81 | )% | | | (61.70 | )% | | | (4.04 | )% | | | (17.39 | )% |
Return on average tangible equity | | | (3.91 | ) | | | (99.45 | ) | | | (5.71 | ) | | | (29.40 | ) |
Return on average assets | | | (0.31 | ) | | | (6.87 | ) | | | (0.43 | ) | | | (1.84 | ) |
Noninterest income as a percentage of total revenue | | | 29.06 | | | | (213.84 | ) | | | 27.45 | | | | (5.87 | ) |
Efficiency ratio (a) | | | 64.88 | | | | 58.96 | | | | 65.92 | | | | 62.38 | |
| | | | |
Asset quality: | | | | | | | | | | | | | | | | |
| | | | |
Allowance for loan losses | | $ | 341,184 | | | $ | 235,329 | | | $ | 341,184 | | | $ | 235,329 | |
Nonperforming assets | | | 401,965 | | | | 263,189 | | | | 401,965 | | | | 263,189 | |
Allowance for loan losses / total loans | | | 3.09 | % | | | 1.93 | % | | | 3.09 | % | | | 1.93 | % |
Net charge-offs / average loans (annualized) | | | 1.85 | | | | 1.66 | | | | 1.68 | | | | 1.09 | |
Nonperforming loans / total loans | | | 3.38 | | | | 1.91 | | | | 3.38 | | | | 1.91 | |
Nonperforming assets / total loans plus OREO | | | 3.63 | | | | 2.15 | | | | 3.63 | | | | 2.15 | |
Allowance for loan losses / nonperforming loans | | | 91.48 | | | | 101.19 | | | | 91.48 | | | | 101.19 | |
| | | | |
Other ratios (annualized): | | | | | | | | | | | | | | | | |
| | | | |
Tangible capital ratio | | | 8.10 | % | | | 7.70 | % | | | 8.10 | % | | | 7.70 | % |
Tangible common equity ratio | | | 5.64 | | | | 4.08 | | | | 5.64 | | | | 4.08 | |
Total-risk based capital (d) | | | 15.34 | | | | 15.20 | | | | 15.34 | | | | 15.20 | |
Tier 1 common equity / risk weighted assets (d) | | | 7.83 | | | | 5.66 | | | | 7.83 | | | | 5.66 | |
Shareholders’ equity / total assets | | | 10.98 | | | | 10.66 | | | | 10.98 | | | | 10.66 | |
Interest-rate spread | | | 3.20 | | | | 3.11 | | | | 3.07 | | | | 3.21 | |
Net interest margin | | | 3.26 | | | | 3.20 | | | | 3.13 | | | | 3.28 | |
| | | | |
Share related: | | | | | | | | | | | | | | | | |
| | | | |
Book value per common share | | $ | 19.60 | | | $ | 23.78 | | | $ | 19.60 | | | $ | 23.78 | |
Tangible book value per common share | | | 12.57 | | | | 13.35 | | | | 12.57 | | | | 13.35 | |
Common stock closing price | | | 11.87 | | | | 13.78 | | | | 11.87 | | | | 13.78 | |
Dividends declared per common share | | | 0.01 | | | | 0.30 | | | | 0.04 | | | | 1.20 | |
| | | | |
Common shares issued and outstanding | | | 77,893 | | | | 52,884 | | | | 77,893 | | | | 52,884 | |
Basic shares (average) | | | 71,445 | | | | 52,031 | | | | 60,943 | | | | 52,020 | |
Diluted shares (average) | | | 72,747 | | | | 52,031 | | | | 63,917 | | | | 52,020 | |
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 2009 reporting periods and actual for the 2008 reporting periods. |
WEBSTER FINANCIAL CORPORATION
Consolidated Balance Sheet (unaudited)
| | | | | | | | | | | | |
(In thousands) | | December 31,
2009 | | | September 30,
2009 | | | December 31,
2008 | |
| | | |
Assets: | | | | | | | | | | | | |
| | | |
Cash and due from depository institutions | | $ | 171,184 | | | $ | 173,437 | | | $ | 259,208 | |
Short-term investments | | | 390,310 | | | | 360,618 | | | | 22,154 | |
| | | |
Investment securities: | | | | | | | | | | | | |
Trading, at fair value | | | — | | | | — | | | | 77 | |
Available for sale, at fair value | | | 2,126,043 | | | | 1,912,283 | | | | 1,188,705 | |
Held-to-maturity | | | 2,658,869 | | | | 2,702,881 | | | | 2,522,511 | |
| | | | | | | | | | | | |
Total securities | | | 4,784,912 | | | | 4,615,164 | | | | 3,711,293 | |
| | | |
Loans held for sale | | | 12,528 | | | | 37,005 | | | | 24,524 | |
| | | |
Loans: | | | | | | | | | | | | |
Residential mortgages | | | 2,903,637 | | | | 2,843,066 | | | | 3,068,441 | |
Consumer | | | 3,020,714 | | | | 3,094,927 | | | | 3,300,169 | |
Commercial | | | 2,930,239 | | | | 3,169,425 | | | | 3,586,807 | |
Commercial real estate | | | 2,182,120 | | | | 2,214,941 | | | | 2,232,174 | |
| | | | | | | | | | | | |
Total loans | | | 11,036,710 | | | | 11,322,359 | | | | 12,187,591 | |
Allowance for loan losses | | | (341,184 | ) | | | (326,406 | ) | | | (235,329 | ) |
| | | | | | | | | | | | |
Loans, net | | | 10,695,526 | | | | 10,995,953 | | | | 11,952,262 | |
| | | |
Accrued interest receivable | | | 65,041 | | | | 70,007 | | | | 74,307 | |
Prepaid FDIC premiums | | | 79,241 | | | | — | | | | — | |
Federal Home Loan Bank and Federal Reserve Bank stock | | | 140,874 | | | | 140,874 | | | | 134,874 | |
Premises and equipment, net | | | 178,422 | | | | 179,353 | | | | 185,928 | |
Goodwill and other intangible assets, net | | | 556,752 | | | | 559,592 | | | | 563,926 | |
Cash surrender value of life insurance | | | 289,486 | | | | 286,806 | | | | 279,807 | |
Deferred tax assets, net | | | 121,733 | | | | 139,458 | | | | 189,337 | |
Prepaid expenses and other assets | | | 253,188 | | | | 250,019 | | | | 185,917 | |
| | | | | | | | | | | | |
| | | |
Total Assets | | $ | 17,739,197 | | | $ | 17,808,286 | | | $ | 17,583,537 | |
| | | | | | | | | | | | |
| | | |
Liabilities and Equity: | | | | | | | | | | | | |
| | | |
Deposits: | | | | | | | | | | | | |
Demand deposits | | $ | 1,664,958 | | | $ | 1,571,980 | | | $ | 1,493,295 | |
NOW accounts | | | 2,912,510 | | | | 2,544,260 | | | | 1,802,250 | |
Money market deposit accounts | | | 1,991,423 | | | | 2,209,145 | | | | 1,356,361 | |
Savings accounts | | | 3,146,603 | | | | 2,996,318 | | | | 2,361,169 | |
Certificates of deposit | | | 3,830,865 | | | | 4,148,759 | | | | 4,677,615 | |
Brokered deposits | | | 85,768 | | | | 130,268 | | | | 194,200 | |
| | | | | | | | | | | | |
Total deposits | | | 13,632,127 | | | | 13,600,730 | | | | 11,884,890 | |
| | | |
Securities sold under agreements to repurchase and other short-term debt | | | 856,846 | | | | 872,030 | | | | 1,570,971 | |
Federal Home Loan Bank advances | | | 544,651 | | | | 663,210 | | | | 1,335,996 | |
Long-term debt | | | 588,419 | | | | 589,600 | | | | 687,797 | |
Accrued expenses and other liabilities | | | 159,120 | | | | 185,342 | | | | 220,145 | |
| | | | | | | | | | | | |
Total liabilities | | | 15,781,163 | | | | 15,910,912 | | | | 15,699,799 | |
| | | |
Shareholders’ equity | | | 1,948,393 | | | | 1,887,734 | | | | 1,874,119 | |
Noncontrolling interests | | | 9,641 | | | | 9,640 | | | | 9,619 | |
| | | | | | | | | | | | |
Total equity | | | 1,958,034 | | | | 1,897,374 | | | | 1,883,738 | |
| | | | | | | | | | | | |
| | | |
Total Liabilities and Equity | | $ | 17,739,197 | | | $ | 17,808,286 | | | $ | 17,583,537 | |
| | | | | | | | | | | | |
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) | | 2009 | | | 2008 | | | 2009 | | | 2008 | |
Interest income: | | | | | | | | | | | | | | | | |
Loans including fees | | $ | 127,069 | | | $ | 168,200 | | | $ | 536,635 | | | $ | 710,621 | |
Investment securities | | | 54,029 | | | | 40,398 | | | | 206,630 | | | | 157,055 | |
Loans held for sale | | | 364 | | | | 51 | | | | 2,077 | | | | 1,597 | |
| | | | | | | | | | | | | | | | |
Total interest income | | | 181,462 | | | | 208,649 | | | | 745,342 | | | | 869,273 | |
| | | | | | | | | | | | | | | | |
| | | | |
Interest expense: | | | | | | | | | | | | | | | | |
Deposits | | | 35,937 | | | | 57,154 | | | | 180,804 | | | | 250,182 | |
Borrowings | | | 15,044 | | | | 25,427 | | | | 69,900 | | | | 113,300 | |
| | | | | | | | | | | | | | | | |
Total interest expense | | | 50,981 | | | | 82,581 | | | | 250,704 | | | | 363,482 | |
| | | | | | | | | | | | | | | | |
| | | | |
Net interest income | | | 130,481 | | | | 126,068 | | | | 494,638 | | | | 505,791 | |
Provision for credit losses | | | 67,000 | | | | 100,000 | | | | 303,000 | | | | 186,300 | |
| | | | | | | | | | | | | | | | |
Net interest income after provision for credit losses | | | 63,481 | | | | 26,068 | | | | 191,638 | | | | 319,491 | |
| | | | | | | | | | | | | | | | |
| | | | |
Non-interest income: | | | | | | | | | | | | | | | | |
Deposit service fees | | | 30,634 | | | | 30,018 | | | | 119,421 | | | | 120,132 | |
Loan related fees | | | 6,501 | | | | 7,147 | | | | 24,890 | | | | 29,067 | |
Wealth and investment services | | | 6,009 | | | | 6,480 | | | | 24,000 | | | | 28,140 | |
Mortgage banking activities | | | 1,456 | | | | 336 | | | | 6,901 | | | | 1,230 | |
Increase in cash surrender value of life insurance | | | 2,680 | | | | 2,631 | | | | 10,629 | | | | 10,441 | |
Net gain (loss) on sale of investment securities | | | 53 | | | | (4,233 | ) | | | (13,810 | ) | | | (6,094 | ) |
Other income | | | 2,649 | | | | 1,315 | | | | 7,766 | | | | 6,684 | |
| | | | | | | | | | | | | | | | |
| | | 49,982 | | | | 43,694 | | | | 179,797 | | | | 189,600 | |
Gain on the exchange of trust preferreds for common stock | | | — | | | | — | | | | 24,336 | | | | — | |
Gain on early extinguishment of subordinated notes | | | — | | | | — | | | | 5,993 | | | | — | |
Loss on write-down of investments to fair value | | | (77 | ) | | | (129,593 | ) | | | (28,477 | ) | | | (219,277 | ) |
Visa share transactions | | | — | | | | — | | | | 1,907 | | | | 1,625 | |
Warrants - fair value adjustment | | | 3,552 | | | | — | | | | 3,552 | | | | — | |
| | | | | | | | | | | | | | | | |
Total non-interest income | | | 53,457 | | | | (85,899 | ) | | | 187,108 | | | | (28,052 | ) |
| | | | | | | | | | | | | | | | |
| | | | |
Non-interest expenses: | | | | | | | | | | | | | | | | |
Compensation and benefits | | | 61,644 | | | | 52,078 | | | | 237,074 | | | | 239,701 | |
Occupancy | | | 14,061 | | | | 13,406 | | | | 55,522 | | | | 53,043 | |
Furniture and equipment | | | 15,299 | | | | 15,469 | | | | 60,926 | | | | 61,155 | |
Marketing | | | 4,365 | | | | 2,895 | | | | 14,469 | | | | 13,956 | |
Outside services | | | 4,209 | | | | 4,101 | | | | 15,015 | | | | 15,758 | |
Intangible amortization | | | 1,409 | | | | 1,463 | | | | 5,743 | | | | 5,939 | |
Foreclosed and repossessed asset expenses | | | 2,192 | | | | 1,799 | | | | 7,060 | | | | 4,643 | |
Foreclosed and repossessed asset write-downs | | | 2,745 | | | | 1,615 | | | | 11,099 | | | | 4,300 | |
FDIC deposit insurance assessment | | | 5,565 | | | | 3,468 | | | | 22,056 | | | | 4,698 | |
Other expenses | | | 14,193 | | | | 13,379 | | | | 58,175 | | | | 57,442 | |
| | | | | | | | | | | | | | | | |
| | | 125,682 | | | | 109,673 | | | | 487,139 | | | | 460,635 | |
Severance and other costs | | | 6,533 | | | | 5,905 | | | | 12,255 | | | | 16,158 | |
Impairment of goodwill | | | — | | | | 188,866 | | | | — | | | | 198,379 | |
FDIC special assessment | | | — | | | | — | | | | 8,000 | | | | — | |
| | | | | | | | | | | | | | | | |
Total non-interest expenses | | | 132,215 | | | | 304,444 | | | | 507,394 | | | | 675,172 | |
| | | | | | | | | | | | | | | | |
Loss from continuing operations before income taxes | | | (15,277 | ) | | | (364,275 | ) | | | (128,648 | ) | | | (383,733 | ) |
Income tax benefit | | | (1,593 | ) | | | (63,980 | ) | | | (52,736 | ) | | | (65,840 | ) |
| | | | | | | | | | | | | | | | |
Loss from continuing operations | | | (13,684 | ) | | | (300,295 | ) | | | (75,912 | ) | | | (317,893 | ) |
(Loss) income from discontinued operations, net of tax | | | (11 | ) | | | 8 | | | | 302 | | | | (3,073 | ) |
| | | | | | | | | | | | | | | | |
Consolidated net loss | | $ | (13,695 | ) | | $ | (300,287 | ) | | $ | (75,610 | ) | | $ | (320,966 | ) |
Less: Net income (loss) attributable to noncontrolling interests | | | 1 | | | | (1 | ) | | | 22 | | | | 4 | |
| | | | | | | | | | | | | | | | |
Net loss attributable to Webster Financial Corporation | | | (13,696 | ) | | | (300,286 | ) | | | (75,632 | ) | | | (320,970 | ) |
Preferred stock dividends, accretion and extinguishment gain | | | (40,704 | ) | | | (7,308 | ) | | | (9,620 | ) | | | (12,947 | ) |
| | | | | | | | | | | | | | | | |
Net loss available to common shareholders | | $ | (54,400 | ) | | $ | (307,594 | ) | | $ | (85,252 | ) | | $ | (333,917 | ) |
| | | | | | | | | | | | | | | | |
| | | | |
Diluted shares (average) | | | 72,747 | | | | 52,031 | | | | 63,917 | | | | 52,020 | |
| | | | |
Net loss per common share: | | | | | | | | | | | | | | | | |
Basic | | | | | | | | | | | | | | | | |
Loss from continuing operations | | $ | (0.76 | ) | | $ | (5.91 | ) | | $ | (1.41 | ) | | $ | (6.36 | ) |
Net loss | | | (0.76 | ) | | | (5.91 | ) | | | (1.40 | ) | | | (6.42 | ) |
Diluted | | | | | | | | | | | | | | | | |
Loss from continuing operations | | | (0.84 | ) | | | (5.91 | ) | | | (2.15 | ) | | | (6.36 | ) |
Net loss | | | (0.84 | ) | | | (5.91 | ) | | | (2.14 | ) | | | (6.42 | ) |
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,
2009 | | | Sept. 30,
2009 | | | June 30,
2009 | | | March 31,
2009 | | | Dec. 31,
2008 | |
Interest income: | | | | | | | | | | | | | | | | | | | | |
Loans including fees | | $ | 127,069 | | | $ | 131,266 | | | $ | 137,533 | | | $ | 140,767 | | | $ | 168,200 | |
Investment securities | | | 54,029 | | | | 52,975 | | | | 48,799 | | | | 50,827 | | | | 40,398 | |
Loans held for sale | | | 364 | | | | 716 | | | | 833 | | | | 164 | | | | 51 | |
| | | | | | | | | | | | | | | | | | | | |
Total interest income | | | 181,462 | | | | 184,957 | | | | 187,165 | | | | 191,758 | | | | 208,649 | |
| | | | | | | | | | | | | | | | | | | | |
| | | | | |
Interest expense: | | | | | | | | | | | | | | | | | | | | |
Deposits | | | 35,937 | | | | 41,977 | | | | 49,982 | | | | 52,908 | | | | 57,154 | |
Borrowings | | | 15,044 | | | | 16,308 | | | | 17,895 | | | | 20,653 | | | | 25,427 | |
| | | | | | | | | | | | | | | | | | | | |
Total interest expense | | | 50,981 | | | | 58,285 | | | | 67,877 | | | | 73,561 | | | | 82,581 | |
| | | | | | | | | | | | | | | | | | | | |
| | | | | |
Net interest income | | | 130,481 | | | | 126,672 | | | | 119,288 | | | | 118,197 | | | | 126,068 | |
Provision for credit losses | | | 67,000 | | | | 85,000 | | | | 85,000 | | | | 66,000 | | | | 100,000 | |
| | | | | | | | | | | | | | | | | | | | |
Net interest income after provision for credit losses | | | 63,481 | | | | 41,672 | | | | 34,288 | | | | 52,197 | | | | 26,068 | |
| | | | | | | | | | | | | | | | | | | | |
| | | | | |
Noninterest income: | | | | | | | | | | | | | | | | | | | | |
Deposit service fees | | | 30,634 | | | | 30,844 | | | | 29,984 | | | | 27,959 | | | | 30,018 | |
Loan related fees | | | 6,501 | | | | 5,557 | | | | 6,350 | | | | 6,482 | | | | 7,147 | |
Wealth and investment services | | | 6,009 | | | | 6,160 | | | | 6,081 | | | | 5,750 | | | | 6,480 | |
Mortgage banking activities | | | 1,456 | | | | 1,406 | | | | 3,433 | | | | 606 | | | | 336 | |
Increase in cash surrender value of life insurance | | | 2,680 | | | | 2,692 | | | | 2,665 | | | | 2,592 | | | | 2,631 | |
Net gain (loss) on sale of investment securities | | | 53 | | | | (4,728 | ) | | | (13,593 | ) | | | 4,458 | | | | (4,233 | ) |
Other income | | | 2,649 | | | | 3,517 | | | | 1,325 | | | | 275 | | | | 1,315 | |
| | | | | | | | | | | | | | | | | | | | |
| | | 49,982 | | | | 45,448 | | | | 36,245 | | | | 48,122 | | | | 43,694 | |
Gain on the exchange of trust preferreds for common stock | | | — | | | | — | | | | 24,336 | | | | — | | | | — | |
Gain on early extinguishment of debt and swaps | | | — | | | | — | | | | — | | | | 5,993 | | | | — | |
Loss on write-down of investments to fair value | | | (77 | ) | | | (1,290 | ) | | | (27,110 | ) | | | — | | | | (129,593 | ) |
Warrants - fair value adjustment | | | 3,552 | | | | — | | | | — | | | | — | | | | — | |
Visa share transactions | | | — | | | | — | | | | 1,907 | | | | — | | | | — | |
| | | | | | | | | | | | | | | | | | | | |
Total noninterest income | | | 53,457 | | | | 44,158 | | | | 35,378 | | | | 54,115 | | | | (85,899 | ) |
| | | | | | | | | | | | | | | | | | | | |
| | | | | |
Noninterest expenses: | | | | | | | | | | | | | | | | | | | | |
Compensation and benefits | | | 61,644 | | | | 59,772 | | | | 59,189 | | | | 56,469 | | | | 52,078 | |
Occupancy | | | 14,061 | | | | 13,572 | | | | 13,594 | | | | 14,295 | | | | 13,406 | |
Furniture and equipment | | | 15,299 | | | | 15,199 | | | | 15,288 | | | | 15,140 | | | | 15,469 | |
Marketing | | | 4,365 | | | | 3,802 | | | | 3,196 | | | | 3,106 | | | | 2,895 | |
Outside services | | | 4,209 | | | | 3,628 | | | | 3,394 | | | | 3,784 | | | | 4,101 | |
Intangible amortization | | | 1,409 | | | | 1,421 | | | | 1,450 | | | | 1,463 | | | | 1,463 | |
Foreclosed and repossessed asset expenses | | | 2,192 | | | | 1,733 | | | | 1,799 | | | | 1,179 | | | | 1,799 | |
Foreclosed and repossessed asset write-downs | | | 2,745 | | | | 2,232 | | | | 2,829 | | | | 3,450 | | | | 1,615 | |
FDIC deposit insurance assessment | | | 5,565 | | | | 5,942 | | | | 5,959 | | | | 4,590 | | | | 3,468 | |
Other expenses | | | 14,193 | | | | 15,616 | | | | 14,066 | | | | 14,302 | | | | 13,379 | |
| | | | | | | | | | | | | | | | | | | | |
| | | 125,682 | | | | 122,917 | | | | 120,764 | | | | 117,778 | | | | 109,673 | |
Severance and other costs | | | 6,533 | | | | 4,169 | | | | 1,313 | | | | 240 | | | | 5,905 | |
FDIC special assessment | | | — | | | | — | | | | 8,000 | | | | — | | | | — | |
Goodwill impairment | | | — | | | | — | | | | — | | | | — | | | | 188,866 | |
| | | | | | | | | | | | | | | | | | | | |
Total noninterest expenses | | | 132,215 | | | | 127,086 | | | | 130,077 | | | | 118,018 | | | | 304,444 | |
| | | | | | | | | | | | | | | | | | | | |
Loss from continuing operations before income taxes | | | (15,277 | ) | | | (41,256 | ) | | | (60,411 | ) | | | (11,706 | ) | | | (364,275 | ) |
Income tax benefit | | | (1,593 | ) | | | (22,014 | ) | | | (28,536 | ) | | | (593 | ) | | | (63,980 | ) |
| | | | | | | | | | | | | | | | | | | | |
Loss from continuing operations | | | (13,684 | ) | | | (19,242 | ) | | | (31,875 | ) | | | (11,113 | ) | | | (300,295 | ) |
(Loss) income from discontinued operations, net of tax | | | (11 | ) | | | — | | | | 313 | | | | — | | | | 8 | |
| | | | | | | | | | | | | | | | | | | | |
Consolidated net loss | | $ | (13,695 | ) | | $ | (19,242 | ) | | $ | (31,562 | ) | | $ | (11,113 | ) | | $ | (300,287 | ) |
Less: Net income (loss) attributable to noncontrolling interests | | | 1 | | | | 8 | | | | — | | | | 13 | | | | (1 | ) |
| | | | | | | | | | | | | | | | | | | | |
Net loss attributable to Webster Financial Corporation | | | (13,696 | ) | | $ | (19,250 | ) | | $ | (31,562 | ) | | $ | (11,126 | ) | | $ | (300,286 | ) |
Preferred stock dividends, accretion and extinguishment gain | | | (40,704 | ) | | | (6,850 | ) | | | 48,361 | | | | (10,430 | ) | | | (7,308 | ) |
| | | | | | | | | | | | | | | | | | | | |
Net (loss) income available to common shareholders | | $ | (54,400 | ) | | $ | (26,100 | ) | | $ | 16,799 | | | $ | (21,556 | ) | | $ | (307,594 | ) |
| | | | | | | | | | | | | | | | | | | | |
| | | | | |
Diluted shares (average) | | | 72,386 | | | | 66,281 | | | | 53,398 | | | | 52,102 | | | | 52,031 | |
| | | | | |
Net income (loss) per common share: | | | | | | | | | | | | | | | | | | | | |
Basic | | | | | | | | | | | | | | | | | | | | |
(Loss) income from continuing operations | | $ | (0.76 | ) | | $ | (0.39 | ) | | $ | 0.31 | | | $ | (0.41 | ) | | $ | (5.91 | ) |
Net (loss) income | | | (0.76 | ) | | | (0.39 | ) | | | 0.31 | | | | (0.41 | ) | | | (5.91 | ) |
Diluted | | | | | | | | | | | | | | | | | | | | |
Loss from continuing operations | | | (0.84 | ) | | | (0.39 | ) | | | (0.66 | ) | | | (0.41 | ) | | | (5.91 | ) |
Net loss | | | (0.84 | ) | | | (0.39 | ) | | | (0.66 | ) | | | (0.41 | ) | | | (5.91 | ) |
See Selected Financial Highlights for footnotes.
WEBSTER FINANCIAL CORPORATION
Five Quarter Interest-Rate Spreads (unaudited)
| | | | | | | | | | | | | | | |
| | | Three Months Ended | |
| | | December 31,
2009 | | | September 30,
2009 | | | June 30,
2009 | | | March 31,
2009 | | | December 31,
2008 | |
Interest-rate spread | | | | | | | | | | | | | | | |
Yield on interest-earning assets | | 4.50 | % | | 4.60 | % | | 4.72 | % | | 4.82 | % | | 5.24 | % |
Cost of interest-bearing liabilities | | 1.30 | | | 1.48 | | | 1.76 | | | 1.91 | | | 2.13 | |
| | | | | | | | | | | | | | | |
Interest-rate spread | | 3.20 | % | | 3.12 | % | | 2.96 | % | | 2.91 | % | | 3.11 | % |
| | | | | | | | | | | | | | | |
| | | | | |
Net interest margin | | 3.26 | % | | 3.18 | % | | 3.04 | % | | 2.99 | % | | 3.20 | % |
| | | | | | | | | | | | | | | |
Consolidated Average Balances, Yields and Rates Paid (unaudited)
| | | | | | | | | | | | | | | | | | | | |
Three Months EndedDecember 31, | | 2009 | | | 2008 | |
(Dollars in thousands) | | Average
balance | | Interest | | | Fully tax-
equivalent
yield/rate | | | Average
balance | | Interest | | | Fully tax-
equivalent
yield/rate | |
Assets: | | | | | | | | | | | | | | | | | | | | |
Interest-earning assets: | | | | | | | | | | | | | | | | | | | | |
Loans | | $ | 11,182,063 | | $ | 127,069 | | | 4.50 | % | | $ | 12,769,534 | | $ | 168,200 | | | 5.22 | % |
Investment securities (b) | | | 4,673,090 | | | 56,607 | | | 4.86 | | | | 3,000,195 | | | 42,918 | | | 5.42 | |
Loans held for sale | | | 41,250 | | | 364 | | | 3.53 | | | | 4,093 | | | 51 | | | 4.99 | |
Federal Home Loan and Federal Reserve Bank stock | | | 140,874 | | | 716 | | | 2.02 | | | | 134,874 | | | 1,196 | | | 3.53 | |
Short-term investments | | | 317,183 | | | 211 | | | 0.26 | | | | 11,399 | | | 40 | | | 1.38 | |
| | | | | | | | | | | | | | | | | | | | |
Total interest-earning assets | | | 16,354,460 | | | 184,967 | | | 4.50 | | | | 15,920,095 | | | 212,405 | | | 5.24 | |
| | | | | | | | | | | | | | | | | | | | |
Noninterest-earning assets | | | 1,331,093 | | | | | | | | | | 1,570,208 | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
Total assets | | $ | 17,685,553 | | | | | | | | | $ | 17,490,303 | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
| | | | | | |
Liabilities and Shareholders’ Equity: | | | | | | | | | | | | | | | | | | | | |
Interest-bearing liabilities: | | | | | | | | | | | | | | | | | | | | |
Demand deposits | | $ | 1,639,058 | | $ | — | | | — | % | | $ | 1,510,066 | | $ | — | | | — | % |
Savings, NOW and money market deposit accounts | | | 7,749,872 | | | 14,429 | | | 0.74 | | | | 5,550,224 | | | 17,849 | | | 1.28 | |
Time deposits | | | 4,110,743 | | | 21,508 | | | 2.08 | | | | 4,823,332 | | | 39,305 | | | 3.24 | |
| | | | | | | | | | | | | | | | | | | | |
Total deposits | | | 13,499,673 | | | 35,937 | | | 1.06 | | | | 11,883,622 | | | 57,154 | | | 1.91 | |
| | | | | | | | | | | | | | | | | | | | |
Securities sold under agreements to repurchase and other short-term debt | | | 884,867 | | | 4,449 | | | 1.97 | | | | 1,446,049 | | | 6,345 | | | 1.72 | |
Federal Home Loan Bank advances | | | 594,919 | | | 5,259 | | | 3.46 | | | | 1,384,706 | | | 8,630 | | | 2.44 | |
Long-term debt | | | 589,548 | | | 5,336 | | | 3.62 | | | | 665,382 | | | 10,452 | | | 6.28 | |
| | | | | | | | | | | | | | | | | | | | |
Total borrowings | | | 2,069,334 | | | 15,044 | | | 2.87 | | | | 3,496,137 | | | 25,427 | | | 2.87 | |
| | | | | | | | | | | | | | | | | | | | |
Total interest-bearing liabilities | | | 15,569,007 | | | 50,981 | | | 1.30 | | | | 15,379,759 | | | 82,581 | | | 2.13 | |
| | | | | | | | | | | | | | | | | | | | |
Noninterest-bearing liabilities | | | 158,592 | | | | | | | | | | 154,048 | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
Total liabilities | | | 15,727,599 | | | | | | | | | | 15,533,807 | | | | | | | |
| | | | | | |
Noncontrolling interests | | | 9,638 | | | | | | | | | | 9,577 | | | | | | | |
| | | | | | |
Shareholders’ equity | | | 1,948,316 | | | | | | | | | | 1,946,919 | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
Total liabilities and shareholders’ equity | | $ | 17,685,553 | | | | | | | | | $ | 17,490,303 | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
| | | | | | |
Tax-equivalent net interest income | | | | | | 133,986 | | | | | | | | | | 129,824 | | | | |
Less: tax-equivalent adjustment | | | | | | (3,505 | ) | | | | | | | | | (3,756 | ) | | | |
| | | | | | | | | | | | | | | | | | | | |
| | | | | | |
Net interest income | | | | | $ | 130,481 | | | | | | | | | $ | 126,068 | | | | |
| | | | | | | | | | | | | | | | | | | | |
| | | | | | |
Interest-rate spread | | | | | | | | | 3.20 | % | | | | | | | | | 3.11 | % |
| | | | | | | | | | | | | | | | | | | | |
Net interest margin | | | | | | | | | 3.26 | % | | | | | | | | | 3.20 | % |
| | | | | | | | | | | | | | | | | | | | |
See Selected Financial Highlights for footnotes.
WEBSTER FINANCIAL CORPORATION
Consolidated Average Balances, Yields and Rates Paid (unaudited)
| | | | | | | | | | | | | | | | | | | | |
Twelve Months EndedDecember 31, | | 2009 | | | 2008 | |
(Dollars in thousands) | | Average
balance | | Interest | | | Fully tax-
equivalent
yield/rate | | | Average
balance | | Interest | | | Fully tax-
equivalent
yield/rate | |
Assets: | | | | | | | | | | | | | | | | | | | | |
Interest-earning assets: | | | | | | | | | | | | | | | | | | | | |
Loans | | $ | 11,697,078 | | $ | 536,635 | | | 4.59 | % | | $ | 12,700,933 | | $ | 710,621 | | | 5.60 | % |
Investment securities (b) | | | 4,150,969 | | | 217,961 | | | 5.18 | | | | 2,895,616 | | | 166,312 | | | 5.56 | |
Loans held for sale | | | 52,131 | | | 2,077 | | | 3.98 | | | | 27,366 | | | 1,597 | | | 5.83 | |
Federal Home Loan and Federal Reserve Bank stock | | | 137,931 | | | 2,685 | | | 1.95 | | | | 127,423 | | | 5,501 | | | 4.32 | |
Short-term investments | | | 156,553 | | | 471 | | | 0.30 | | | | 6,422 | | | 146 | | | 2.27 | |
| | | | | | | | | | | | | | | | | | | | |
Total interest-earning assets | | | 16,194,662 | | | 759,829 | | | 4.68 | | | | 15,757,760 | | | 884,177 | | | 5.58 | |
| | | | | | | | | | | | | | | | | | | | |
Noninterest-earning assets | | | 1,395,821 | | | | | | | | | | 1,546,699 | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
Total assets | | $ | 17,590,483 | | | | | | | | | $ | 17,304,459 | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
| | | | | | |
Liabilities and Shareholders’ Equity: | | | | | | | | | | | | | | | | | | | | |
Interest-bearing liabilities: | | | | | | | | | | | | | | | | | | | | |
Demand deposits | | $ | 1,578,356 | | $ | — | | | — | % | | $ | 1,487,661 | | $ | — | | | — | % |
Savings, NOW and money market deposit accounts | | | 6,977,196 | | | 60,971 | | | 0.87 | | | | 5,776,660 | | | 80,994 | | | 1.40 | |
Time deposits | | | 4,525,770 | | | 119,833 | | | 2.65 | | | | 4,764,386 | | | 169,188 | | | 3.55 | |
| | | | | | | | | | | | | | | | | | | | |
Total deposits | | | 13,081,322 | | | 180,804 | | | 1.38 | | | | 12,028,707 | | | 250,182 | | | 2.08 | |
| | | | | | | | | | | | | | | | | | | | |
Securities sold under agreements to repurchase and other short-term debt | | | 1,124,118 | | | 19,275 | | | 1.71 | | | | 1,359,318 | | | 34,643 | | | 2.55 | |
Federal Home Loan Bank advances | | | 697,711 | | | 25,286 | | | 3.62 | | | | 1,269,098 | | | 39,236 | | | 3.09 | |
Long-term debt | | | 628,145 | | | 25,339 | | | 4.03 | | | | 660,146 | | | 39,421 | | | 5.97 | |
| | | | | | | | | | | | | | | | | | | | |
Total borrowings | | | 2,449,974 | | | 69,900 | | | 2.85 | | | | 3,288,562 | | | 113,300 | | | 3.45 | |
| | | | | | | | | | | | | | | | | | | | |
Total interest-bearing liabilities | | | 15,531,296 | | | 250,704 | | | 1.61 | | | | 15,317,269 | | | 363,482 | | | 2.37 | |
| | | | | | | | | | | | | | | | | | | | |
Noninterest-bearing liabilities | | | 168,970 | | | | | | | | | | 149,236 | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
Total liabilities | | | 15,700,266 | | | | | | | | | | 15,466,505 | | | | | | | |
| | | | | | |
Noncontrolling interests | | | 9,631 | | | | | | | | | | 9,577 | | | | | | | |
| | | | | | |
Shareholders’ equity | | | 1,880,586 | | | | | | | | | | 1,828,377 | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
Total liabilities and shareholders’ equity | | $ | 17,590,483 | | | | | | | | | $ | 17,304,459 | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
| | | | | | 509,125 | | | | | | | | | | 520,695 | | | | |
Less: tax-equivalent adjustment | | | | | | (14,487 | ) | | | | | | | | | (14,904 | ) | | | |
| | | | | | | | | | | | | | | | | | | | |
| | | | | | |
Net interest income | | | | | $ | 494,638 | | | | | | | | | $ | 505,791 | | | | |
| | | | | | | | | | | | | | | | | | | | |
| | | | | | |
Interest-rate spread | | | | | | | | | 3.07 | % | | | | | | | | | 3.21 | % |
| | | | | | | | | | | | | | | | | | | | |
Net interest margin | | | | | | | | | 3.13 | % | | | | | | | | | 3.28 | % |
| | | | | | | | | | | | | | | | | | | | |
See Selected Financial Highlights for footnotes.
WEBSTER FINANCIAL CORPORATION
Five Quarter Loan balances(unaudited)
| | | | | | | | | | | | | | | | | | | | |
(Dollars in thousands) | | Dec. 31,
2009 | | | Sep. 30,
2009 | | | June 30,
2009 | | | March 31,
2009 | | | Dec. 31,
2008 | |
Loan Balances (actuals): | | | | | | | | | | | | | | | | | | | | |
Continuing Portfolio: | | | | | | | | | | | | | | | | | | | | |
Residential mortgages | | $ | 2,898,820 | | | $ | 2,837,240 | | | $ | 2,875,415 | | | $ | 3,170,908 | | | $ | 3,049,706 | |
Consumer | | | 2,801,589 | | | | 2,863,622 | | | | 2,910,275 | | | | 2,979,117 | | | | 3,016,524 | |
Commercial | | | 1,505,956 | | | | 1,619,284 | | | | 1,711,995 | | | | 1,738,640 | | | | 1,797,135 | |
Equipment financing | | | 897,802 | | | | 951,500 | | | | 998,258 | | | | 1,016,718 | | | | 1,037,077 | |
Asset based lending | | | 526,481 | | | | 598,641 | | | | 623,357 | | | | 659,694 | | | | 752,595 | |
Commercial real estate | | | 2,067,862 | | | | 2,086,298 | | | | 2,091,811 | | | | 2,094,751 | | | | 2,070,641 | |
Residential development | | | 114,258 | | | | 128,643 | | | | 143,965 | | | | 155,544 | | | | 161,533 | |
| | | | | | | | | | | | | | | | | | | | |
Total continuing | | | 10,812,768 | | | | 11,085,228 | | | | 11,355,076 | | | | 11,815,372 | | | | 11,885,211 | |
Allowance for loan losses | | | (287,784 | ) | | | (269,306 | ) | | | (264,159 | ) | | | (226,562 | ) | | | (191,426 | ) |
| | | | | | | | | | | | | | | | | | | | |
Total continuing, net | | | 10,524,984 | | | | 10,815,922 | | | | 11,090,917 | | | | 11,588,810 | | | | 11,693,785 | |
| | | | | | | | | | | | | | | | | | | | |
Liquidating Portfolio: | | | | | | | | | | | | | | | | | | | | |
NCLC(c) | | | 4,817 | | | | 5,826 | | | | 6,540 | | | | 13,174 | | | | 18,735 | |
Consumer | | | 219,125 | | | | 231,305 | | | | 249,086 | | | | 266,913 | | | | 283,645 | |
| | | | | | | | | | | | | | | | | | | | |
Total liquidating portfolio | | | 223,942 | | | | 237,131 | | | | 255,626 | | | | 280,087 | | | | 302,380 | |
Allowance for loan losses | | | (53,400 | ) | | | (57,100 | ) | | | (41,840 | ) | | | (44,367 | ) | | | (43,903 | ) |
| | | | | | | | | | | | | | | | | | | | |
Total liquidating, net | | | 170,542 | | | | 180,031 | | | | 213,786 | | | | 235,720 | | | | 258,477 | |
| | | | | | | | | | | | | | | | | | | | |
| | | | | |
Total Loan Balances (actuals) | | | 11,036,710 | | | | 11,322,359 | | | | 11,610,702 | | | | 12,095,459 | | | | 12,187,591 | |
Allowance for loan losses | | | (341,184 | ) | | | (326,406 | ) | | | (305,999 | ) | | | (270,929 | ) | | | (235,329 | ) |
| | | | | | | | | | | | | | | | | | | | |
Loans (net) | | $ | 10,695,526 | | | $ | 10,995,953 | | | $ | 11,304,703 | | | $ | 11,824,530 | | | $ | 11,952,262 | |
| | | | | | | | | | | | | | | | | | | | |
| | | | | |
Loan Balances (average): | | | | | | | | | | | | | | | | | | | | |
Continuing Portfolio: | | | | | | | | | | | | | | | | | | | | |
Residential mortgages | | $ | 2,860,204 | | | $ | 2,831,440 | | | $ | 3,127,099 | | | $ | 3,092,512 | | | $ | 3,449,202 | |
Consumer | | | 2,834,923 | | | | 2,884,543 | | | | 2,951,691 | | | | 3,012,178 | | | | 2,989,393 | |
Commercial | | | 1,548,470 | | | | 1,675,289 | | | | 1,750,996 | | | | 1,784,062 | | | | 1,811,527 | |
Equipment finance | | | 930,050 | | | | 975,552 | | | | 1,011,999 | | | | 1,026,322 | | | | 1,015,340 | |
Asset based lending | | | 577,330 | | | | 622,472 | | | | 652,197 | | | | 701,263 | | | | 842,148 | |
Commercial real estate | | | 2,075,754 | | | | 2,089,643 | | | | 2,090,615 | | | | 2,083,861 | | | | 2,182,228 | |
Residential development | | | 125,320 | | | | 139,040 | | | | 150,674 | | | | 158,924 | | | | 161,533 | |
| | | | | | | | | | | | | | | | | | | | |
Total continuing | | | 10,952,051 | | | | 11,217,979 | | | | 11,735,271 | | | | 11,859,122 | | | | 12,451,371 | |
Allowance for loan losses | | | (277,870 | ) | | | (260,472 | ) | | | (248,701 | ) | | | (204,619 | ) | | | (167,230 | ) |
| | | | | | | | | | | | | | | | | | | | |
Total continuing, net | | | 10,674,181 | | | | 10,957,507 | | | | 11,486,570 | | | | 11,654,503 | | | | 12,284,141 | |
| | | | | | | | | | | | | | | | | | | | |
Liquidating Portfolio: | | | | | | | | | | | | | | | | | | | | |
NCLC(c) | | | 5,661 | | | | 6,414 | | | | 10,090 | | | | 15,675 | | | | 24,199 | |
Consumer | | | 224,351 | | | | 240,675 | | | | 258,001 | | | | 276,219 | | | | 293,964 | |
| | | | | | | | | | | | | | | | | | | | |
Total liquidating portfolio | | | 230,012 | | | | 247,089 | | | | 268,091 | | | | 291,894 | | | | 318,163 | |
Allowance for loan losses | | | (53,400 | ) | | | (57,100 | ) | | | (41,840 | ) | | | (44,367 | ) | | | (43,903 | ) |
| | | | | | | | | | | | | | | | | | | | |
Total liquidating, net | | | 176,612 | | | | 189,989 | | | | 226,251 | | | | 247,527 | | | | 274,260 | |
| | | | | | | | | | | | | | | | | | | | |
| | | | | |
Total Loan Balances (average) | | | 11,182,063 | | | | 11,465,068 | | | | 12,003,362 | | | | 12,151,016 | | | | 12,769,534 | |
Allowance for loan losses | | | (331,270 | ) | | | (317,572 | ) | | | (290,541 | ) | | | (248,986 | ) | | | (211,133 | ) |
| | | | | | | | | | | | | | | | | | | | |
Loans (net) | | $ | 10,850,793 | | | $ | 11,147,496 | | | $ | 11,712,821 | | | $ | 11,902,030 | | | $ | 12,558,401 | |
| | | | | | | | | | | | | | | | | | | | |
See Selected Financial Highlights for footnotes.
WEBSTER FINANCIAL CORPORATION
Five Quarter Nonperforming Assets(unaudited)
| | | | | | | | | | | | | | | |
(Dollars in thousands) | | Dec. 31,
2009 | | Sept. 30,
2009 | | June 30,
2009 | | March 31,
2009 | | Dec. 31,
2008 |
Nonperforming loans: | | | | | | | | | | | | | | | |
Continuing Portfolio: | | | | | | | | | | | | | | | |
Residential mortgages | | $ | 70,311 | | $ | 66,180 | | $ | 59,775 | | $ | 55,962 | | $ | 48,731 |
Performing non-accrual residential mortgages | | | 39,256 | | | 43,581 | | | 33,822 | | | 10,849 | | | 3,771 |
Commercial | | | 56,632 | | | 61,746 | | | 68,979 | | | 65,073 | | | 32,915 |
Equipment financing | | | 30,152 | | | 31,784 | | | 35,675 | | | 16,056 | | | 13,138 |
Asset based lending | | | 13,982 | | | 5,064 | | | 24,456 | | | 29,353 | | | 17,072 |
Commercial real estate | | | 56,144 | | | 47,644 | | | 16,707 | | | 12,604 | | | 8,032 |
Residential development | | | 47,264 | | | 44,821 | | | 46,808 | | | 54,147 | | | 48,628 |
Consumer | | | 31,299 | | | 33,837 | | | 33,816 | | | 37,518 | | | 29,627 |
Performing non-accrual consumer | | | 7,456 | | | 6,000 | | | 4,534 | | | 2,652 | | | 312 |
| | | | | | | | | | | | | | | |
Nonperforming loans - continuing portfolio | | | 352,496 | | | 340,657 | | | 324,572 | | | 284,214 | | | 202,226 |
| | | | | | | | | | | | | | | |
| | | | | |
Liquidating Portfolio: | | | | | | | | | | | | | | | |
NCLC(c) | | | 3,408 | | | 4,089 | | | 5,628 | | | 12,259 | | | 12,821 |
Performing non-accrual NCLC | | | 825 | | | 825 | | | — | | | — | | | 581 |
Consumer | | | 13,915 | | | 14,030 | | | 19,521 | | | 19,510 | | | 16,757 |
Performing non-accrual consumer | | | 2,333 | | | 1,475 | | | 674 | | | 185 | | | 181 |
| | | | | | | | | | | | | | | |
Nonperforming loans - liquidating portfolio | | | 20,481 | | | 20,419 | | | 25,823 | | | 31,954 | | | 30,340 |
| | | | | | | | | | | | | | | |
| | | | | |
Total nonperforming loans | | $ | 372,977 | | $ | 361,076 | | $ | 350,395 | | $ | 316,168 | | $ | 232,566 |
| | | | | | | | | | | | | | | |
| | | | | |
Other real estate owned and repossessed assets: | | | | | | | | | | | | | | | |
Continuing Portfolio: | | | | | | | | | | | | | | | |
Residential mortgages | | $ | 4,131 | | $ | 2,872 | | $ | 1,808 | | $ | 1,399 | | $ | 1,863 |
Commercial | | | 11,621 | | | 13,225 | | | 9,340 | | | 10,361 | | | 9,782 |
Equipment financing | | | 6,522 | | | 8,479 | | | 10,322 | | | 13,352 | | | 13,086 |
Asset based lending | | | — | | | — | | | — | | | — | | | — |
Commercial real estate | | | — | | | — | | | — | | | — | | | — |
Residential development | | | — | | | — | | | — | | | — | | | — |
Consumer | | | 5,017 | | | 4,833 | | | 5,571 | | | 369 | | | 1,244 |
| | | | | | | | | | | | | | | |
Total continuing | | | 27,291 | | | 29,409 | | | 27,041 | | | 25,481 | | | 25,975 |
| | | | | | | | | | | | | | | |
| | | | | |
Liquidating Portfolio: | | | | | | | | | | | | | | | |
NCLC(c) | | | 1,401 | | | 3,108 | | | 5,836 | | | 5,563 | | | 3,519 |
Consumer | | | 296 | | | — | | | 931 | | | 1,139 | | | 1,129 |
| | | | | | | | | | | | | | | |
Nonperforming loans - liquidating portfolio | | | 1,697 | | | 3,108 | | | 6,767 | | | 6,702 | | | 4,648 |
| | | | | | | | | | | | | | | |
| | | | | |
Total other real estate owned and repossessed assets | | $ | 28,988 | | $ | 32,517 | | $ | 33,808 | | $ | 32,183 | | $ | 30,623 |
| | | | | | | | | | | | | | | |
| | | | | |
Total nonperforming assets | | $ | 401,965 | | $ | 393,593 | | $ | 384,203 | | $ | 348,351 | | $ | 263,189 |
| | | | | | | | | | | | | | | |
See Selected Financial Highlights for footnotes.
WEBSTER FINANCIAL CORPORATION
Five Quarter Past Due Loans(unaudited)
| | | | | | | | | | | | | | | |
(Dollars in thousands) | | Dec. 31,
2009 | | Sept. 30,
2009 | | June 30,
2009 | | March 31,
2009 | | Dec. 31,
2008 |
Past due 30-89 days: | | | | | | | | | | | | | | | |
| | | | | |
Accruing loans: | | | | | | | | | | | | | | | |
Continuing Portfolio: | | | | | | | | | | | | | | | |
Residential mortgages | | $ | 36,086 | | $ | 38,927 | | $ | 39,955 | | $ | 45,798 | | $ | 45,909 |
Commercial | | | 7,870 | | | 9,735 | | | 8,460 | | | 8,033 | | | 15,817 |
Equipment financing | | | 10,642 | | | 10,407 | | | 13,464 | | | 16,404 | | | 9,860 |
Asset based lending | | | — | | | — | | | — | | | 145 | | | 3,676 |
Commercial real estate | | | 8,184 | | | 23,872 | | | 19,053 | | | 8,373 | | | 7,158 |
Residential development | | | 551 | | | 776 | | | 3,210 | | | 1,004 | | | 2,096 |
Consumer | | | 27,214 | | | 31,178 | | | 28,354 | | | 33,092 | | | 33,848 |
| | | | | | | | | | | | | | | |
Past Due 30-89 days - continuing portfolio | | | 90,547 | | | 114,895 | | | 112,496 | | | 112,849 | | | 118,364 |
| | | | | | | | | | | | | | | |
| | | | | |
Liquidating Portfolio: | | | | | | | | | | | | | | | |
NCLC(c) | | | 582 | | | 910 | | | 1 | | | 1 | | | 4,487 |
Consumer | | | 9,804 | | | 11,680 | | | 9,880 | | | 12,244 | | | 15,621 |
| | | | | | | | | | | | | | | |
Past Due 30-89 days - liquidating portfolio | | | 10,386 | | | 12,590 | | | 9,881 | | | 12,245 | | | 20,108 |
| | | | | | | | | | | | | | | |
| | | | | |
Accruing loans past due 90 days or more: | | | | | | | | | | | | | | | |
Residential mortgages | | | — | | | — | | | — | | | — | | | — |
Commercial | | | 50 | | | 2,685 | | | 445 | | | 573 | | | 459 |
Equipment financing | | | — | | | — | | | — | | | — | | | — |
Asset based lending | | | — | | | — | | | — | | | — | | | — |
Commercial real estate | | | 236 | | | 206 | | | 475 | | | — | | | 450 |
Residential development | | | — | | | — | | | — | | | 150 | | | 201 |
Consumer | | | — | | | — | | | — | | | — | | | — |
| | | | | | | | | | | | | | | |
Accruing loans past due 90 days or more: | | | 286 | | | 2,891 | | | 920 | | | 723 | | | 1,110 |
| | | | | | | | | | | | | | | |
| | | | | |
Total past due loans | | $ | 101,219 | | $ | 130,376 | | $ | 123,297 | | $ | 125,817 | | $ | 139,582 |
| | | | | | | | | | | | | | | |
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,
2009 | | | Sept. 30,
2009 | | June 30,
2009 | | | March 31,
2009 | | Dec. 31,
2008 |
Beginning balance | | $ | 336,511 | | | $ | 316,037 | | $ | 281,729 | | | $ | 245,829 | | $ | 198,669 |
Provision | | | 67,000 | | | | 85,000 | | | 85,000 | | | | 66,000 | | | 100,000 |
Allowance for sold loans | | | (469 | ) | | | — | | | — | | | | — | | | — |
| | | | | |
Charge-offs continuing portfolio: | | | | | | | | | | | | | | | | | |
Residential mortgages | | | 2,858 | | | | 2,721 | | | 4,793 | | | | 2,964 | | | 3,778 |
Commercial | | | 6,094 | | | | 13,729 | | | 8,983 | | | | 5,388 | | | 5,416 |
Equipment financing | | | 13,302 | | | | 7,939 | | | 6,324 | | | | 2,236 | | | 1,222 |
Asset based lending | | | 1,099 | | | | 15,926 | | | 5,297 | | | | 2,981 | | | 176 |
Commercial real estate | | | 4,605 | | | | — | | | — | | | | — | | | 53 |
Residential development | | | 6,600 | | | | 3,019 | | | 2,350 | | | | 48 | | | 30,158 |
Consumer | | | 10,723 | | | | 10,237 | | | 10,242 | | | | 6,541 | | | 3,887 |
| | | | | | | | | | | | | | | | | |
Charge-offs continuing portfolio | | | 45,281 | | | | 53,571 | | | 37,989 | | | | 20,158 | | | 44,690 |
| | | | | |
Charge-offs liquidating portfolio: | | | | | | | | | | | | | | | | | |
NCLC(c) | | | 1,068 | | | | 135 | | | 3,387 | | | | 2,086 | | | 777 |
Consumer | | | 8,232 | | | | 13,256 | | | 10,825 | | | | 9,911 | | | 8,779 |
| | | | | | | | | | | | | | | | | |
Charge-offs liquidating portfolio | | | 9,300 | | | | 13,391 | | | 14,212 | | | | 11,997 | | | 9,556 |
| | | | | | | | | | | | | | | | | |
| | | | | |
Total charge-offs | | | 54,581 | | | | 66,962 | | | 52,201 | | | | 32,155 | | | 54,246 |
| | | | | | | | | | | | | | | | | |
| | | | | |
Recoveries continuing portfolio: | | | | | | | | | | | | | | | | | |
Residential mortgages | | | 82 | | | | 277 | | | 115 | | | | 24 | | | 85 |
Commercial | | | 476 | | | | 435 | | | 230 | | | | 378 | | | 225 |
Equipment financing | | | 898 | | | | 821 | | | 203 | | | | 287 | | | 177 |
Asset based lending | | | 55 | | | | — | | | — | | | | 5 | | | 129 |
Commercial real estate | | | — | | | | — | | | — | | | | — | | | — |
Residential development | | | — | | | | — | | | 9 | | | | — | | | — |
Consumer | | | 535 | | | | 642 | | | 702 | | | | 766 | | | 180 |
| | | | | | | | | | | | | | | | | |
Recoveries continuing portfolio | | | 2,046 | | | | 2,175 | | | 1,259 | | | | 1,460 | | | 796 |
| | | | | | | | | | | | | | | | | |
| | | | | |
Recoveries liquidating portfolio: | | | | | | | | | | | | | | | | | |
NCLC(c) | | | 614 | | | | 62 | | | 825 | | | | 528 | | | 595 |
Consumer | | | 168 | | | | 132 | | | 187 | | | | 67 | | | 15 |
| | | | | | | | | | | | | | | | | |
Recoveries liquidating portfolio | | | 782 | | | | 194 | | | 1,012 | | | | 595 | | | 610 |
| | | | | | | | | | | | | | | | | |
| | | | | |
Total recoveries | | | 2,828 | | | | 2,369 | | | 2,271 | | | | 2,055 | | | 1,406 |
| | | | | | | | | | | | | | | | | |
| | | | | |
Total net charge-offs | | | 51,753 | | | | 64,593 | | | 49,930 | | | | 30,100 | | | 52,840 |
| | | | | | | | | | | | | | | | | |
| | | | | |
Change in unfunded commitments | | | — | | | | 67 | | | (762 | ) | | | — | | | — |
| | | | | |
Ending balance | | $ | 351,289 | | | $ | 336,511 | | $ | 316,037 | | | $ | 281,729 | | $ | 245,829 |
| | | | | | | | | | | | | | | | | |
Components: | | | | | | | | | | | | | | | | | |
Allowance for loan losses | | $ | 341,184 | | | $ | 326,406 | | $ | 305,999 | | | $ | 270,929 | | $ | 235,329 |
Reserve for unfunded credit commitments | | | 10,105 | | | | 10,105 | | | 10,038 | | | | 10,800 | | | 10,500 |
| | | | | | | | | | | | | | | | | |
Allowance for credit losses | | $ | 351,289 | | | $ | 336,511 | | $ | 316,037 | | | $ | 281,729 | | $ | 245,829 |
| | | | | | | | | | | | | | | | | |
See Selected Financial Highlights for footnotes.
WEBSTER FINANCIAL CORPORATION
Asset Quality Ratios
| | | | | | | | | | | | | | | |
| | | For the Three Months Ended | |
(Dollars in thousands) | | Dec. 31,
2009 | | | Sept. 30,
2009 | | | June 30,
2009 | | | March 31,
2009 | | | Dec. 31,
2008 | |
| | | | | |
Total Portfolio | | | | | | | | | | | | | | | |
Allowance for loan losses / total loans | | 3.09 | % | | 2.88 | % | | 2.64 | % | | 2.24 | % | | 1.93 | % |
Net charge-offs / average loans (annualized) | | 1.85 | | | 2.25 | | | 1.66 | | | 0.99 | | | 1.66 | |
Nonperforming loans / total loans | | 3.38 | | | 3.19 | | | 3.02 | | | 2.61 | | | 1.91 | |
Nonperforming assets / total loans plus OREO | | 3.63 | | | 3.47 | | | 3.30 | | | 2.87 | | | 2.15 | |
Allowance for loan losses / nonperforming loans | | 91.48 | | | 90.40 | | | 87.33 | | | 85.69 | | | 101.19 | |
| | | | | |
Continuing Portfolio | | | | | | | | | | | | | | | |
Allowance for loan losses / total loans | | 2.66 | % | | 2.43 | % | | 2.33 | % | | 1.92 | % | | 1.61 | % |
Net charge-offs / average loans (annualized) | | 1.58 | | | 1.83 | | | 1.25 | | | 0.63 | | | 1.41 | |
Nonperforming loans / total loans | | 3.26 | | | 3.07 | | | 2.86 | | | 2.41 | | | 1.70 | |
Nonperforming assets / total loans plus OREO | | 3.50 | | | 3.33 | | | 3.09 | | | 2.62 | | | 1.92 | |
Allowance for loan losses / nonperforming loans | | 81.64 | | | 79.05 | | | 81.39 | | | 79.72 | | | 97.05 | |
| | | | | |
Liquidating Portfolio | | | | | | | | | | | | | | | |
NCLC (C) | | | | | | | | | | | | | | | |
Allowance for loan losses / total loans | | 18.68 | % | | 17.16 | % | | 23.00 | % | | 30.86 | % | | 30.01 | % |
Net charge-offs / average loans (annualized) | | 32.08 | | | 4.55 | | | 101.57 | | | 39.76 | | | 2.99 | |
Nonperforming loans / total loans | | 87.88 | | | 84.35 | | | 86.06 | | | 93.05 | | | 71.53 | |
Allowance for loan losses / nonperforming loans | | 21.26 | | | 20.35 | | | 26.72 | | | 33.16 | | | 41.96 | |
| | | | | |
Consumer | | | | | | | | | | | | | | | |
Allowance for loan losses / total loans | | 23.96 | % | | 24.25 | % | | 16.19 | % | | 15.10 | % | | 13.50 | % |
Net charge-offs / average loans (annualized) | | 14.38 | | | 21.81 | | | 16.49 | | | 14.26 | | | 11.93 | |
Nonperforming loans / total loans | | 7.41 | | | 6.70 | | | 8.11 | | | 7.38 | | | 5.97 | |
Allowance for loan losses / nonperforming loans | | 323.12 | | | 361.82 | | | 199.73 | | | 204.63 | | | 225.99 | |
See Selected Financial Highlights for footnotes.
