Exhibit 99.1
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BankAtlantic Bancorp Reports Financial Results
For the First Quarter, 2010
For the First Quarter, 2010
FORT LAUDERDALE, Florida — May 4, 2010 — BankAtlantic Bancorp, Inc. (NYSE: BBX) today reported a net loss from continuing operations of ($20.5) million, or ($0.42) per diluted share, for the quarter ended March 31, 2010, compared to a net loss from continuing operations of ($52.5) million, or ($1.07) per diluted share, for the quarter ended December 31, 2009, and a net loss from continuing operations of ($46.6) million, or ($3.09) per diluted share, for the quarter ended March 31, 2009.
BankAtlantic Bancorp’s Chairman and Chief Executive Officer, Alan B. Levan, commented, “The current quarter’s results continue to reflect losses associated with our real estate related loan portfolios, especially in the commercial real estate sector. The decreased loss compared to the fourth quarter of 2009 resulted primarily from lower loan loss provisions and lower non-interest expense in the first quarter of 2010, partially offset by a net tax benefit in the fourth quarter of 2009 resulting from the enactment of favorable tax legislation in that quarter relating to the use of net operating losses. The decreased loss compared to the first quarter of 2009 resulted largely from lower loan loss provisions and lower non-interest expense in the first quarter of 2010.
Highlights of the BankAtlantic Operating Segment:
Capital Levels:
“BankAtlantic’s capital ratios at March 31, 2010 were:
• | Total risk-based capital of 12.86%. | ||
• | Tier 1 risk-based capital of 10.90%. | ||
• | Core capital of 7.51%. |
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BankAtlantic Performance:
Deposits and Borrowings—BankAtlantic’s Chief Executive Officer, Jarett S. Levan, commented, “Core(1) and total deposits at March 31, 2010 were $2.8 billion and $4.0 billion, respectively, with the following characteristics:
– | “Non-certificate of deposit balances represented approximately 79.3% of total deposits; | ||
– | “The average cost of core deposits and total deposits for the first quarter of 2010 was 0.38% and 0.71%, respectively; and | ||
– | “Brokered deposit balances represented only 0.6% of assets and 0.7% of total deposits. |
• | “During the first quarter of 2010, core deposits increased $196.5 million, or 7.4%. Since March 31, 2009, core deposits increased $504.1 million, or 21.5%. | ||
• | “Total deposits increased by $77.8 million during the first quarter of 2010 primarily due to core deposit growth partially offset by decreases in higher cost certificates of deposit of $120.5 million. Since March 31, 2009, total deposits decreased by $6 million primarily due to runoff of higher cost certificates of deposits exceeding core deposit growth. | ||
• | “BankAtlantic continued to reduce its borrowings, resulting in total borrowings of $205.8 million, or 4.4% of total assets, at March 31, 2010. |
– | “During the first quarter of 2010, borrowings were reduced by $139.6 million, or 40.4%, since December 31, 2009. Since March 31, 2009, borrowings have been reduced by $752.1 million, or 78.5%, primarily through the repayment of FHLB borrowings with an average interest rate of 3.22%. | ||
– | “BankAtlantic’s ratio of total borrowings to deposits plus borrowings was 4.8% at March 31, 2010, compared to 8.0% at December 31, 2009 and 19.1% at March 31, 2009. |
Net Income —“BankAtlantic’s net loss was ($17.1) million for the first quarter of 2010, compared to a net loss of ($48.6) million for the fourth quarter of 2009, and a net loss of ($40.6) million for the first quarter of 2009.
(1) | Core deposits is a term that we use to refer to Demand, NOW and Savings accounts. A reconciliation of core deposits to total deposits is included in BankAtlantic Bancorp’s First Quarter, 2010 Supplemental Financials available at www.BankAtlanticBancorp.com. To view the financial data, access the “Investor Relations” section and click on the “Quarterly Financials or Supplemental Financials” navigation links. |
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• | “Pretax core operating earnings(2) for the first quarter of 2010 was $15.9 million compared to $10.6 million in the fourth quarter of 2009, and $16.2 million for the first quarter of 2009. Loan loss and tax certificate provisions, debt redemption costs, and impairment, restructuring and exit activity expenses, which are not included in pre-tax core operating earnings, were ($32.9) million for the first quarter of 2010, ($90.9) million for the fourth quarter of 2009, and ($56.8) million for the first quarter of 2009. |
Net Interest Margin— “Net interest income for the first quarter of 2010 was $39.0 million compared to $40.0 million during the fourth quarter of 2009, and $41.8 million for the first quarter of 2009.
• | “Net interest margin during the first quarter of 2010 was 3.71%, a 9 basis point improvement from 3.62% during the fourth quarter of 2009, and a 57 basis point improvement from 3.14% during the first quarter of 2009. | ||
• | “Net interest spread during the first quarter of 2010 was 3.52%, improved by 14 basis points from 3.38% during the fourth quarter of 2009, and improved by 70 basis points from 2.82% during the first quarter of 2009. |
“Quarterly net interest margin and spread improved compared to the fourth quarter of 2009 due to declines in certificates of deposit and FHLB funding costs; the significant improvement in both the margin and spread compared to the first quarter of 2009 was largely the result of changes in the funding mix associated with growth in core deposits, declines in certificates of deposit balances and rates, and the repayment of FHLB advances during the past year.
“Net interest income decreased slightly in the first quarter of 2010 compared to the fourth and first quarters of 2009, as the negative impact on net interest income of declining average earning assets and increasing non-performing assets was partially offset by margin improvements. Average earning assets declined by $238.7 million from the fourth quarter of 2009, and by $1.1 billion from the first quarter of 2009. Additionally, non-performing asset levels increased by $19.5 million since December 31, 2009 and by $49.2 million since March 31, 2009.
(2) | Pre-tax core operating earnings is a non-GAAP measure that we use to refer to pre-tax earnings before provision for loan losses, tax certificate provisions, debt redemption costs, FDIC special assessments and impairment, restructuring and exit activities. A reconciliation of loss from bank operations before income taxes to pre-tax core operating earnings is included in BankAtlantic Bancorp’s First Quarter, 2010 Supplemental Financials available at www.BankAtlanticBancorp.com. To view the financial data, access the “Investor Relations” section and click on the “Quarterly Financials or Supplemental Financials” navigation links. |
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Non-interest income —“Total non-interest income for the first quarter of 2009 was $28.7 million compared to $28.2 million for the fourth quarter of 2009, and $32.9 million for the first quarter of 2009.
• | “Excluding securities gains of $3.1 million in the first quarter of 2010, none in the fourth quarter of 2009 and $4.3 million in the first quarter of 2009, non-interest income would have been $25.6 million for the first quarter of 2010, compared to $28.2 million for the fourth quarter of 2009 and $28.5 million for the first quarter of 2009. | ||
• | “Service charges on deposits declined in the first quarter of 2010 reflecting changes in customer behavior as well as changes in our customer base which we believe are the result of our relationship-focused deposit gathering strategies. |
Non-interest expense—“Total non-interest expenses were $52.7 million in the first quarter of 2010 compared to $66.0 million in the fourth quarter of 2009, and $71.7 million in the first quarter of 2009.
• | “Core expenses(3) were $51.8 million in the first quarter of 2010, compared to $57.6 million in the fourth quarter of 2009, and $58.4 million in the first quarter of 2009. The improvement in core expenses in the first quarter of 2010 from the fourth quarter of 2009 was primarily due to the following reductions in expenses: $1.9 million of employee compensation and benefits related to reduced incentive compensation accruals; $2.0 million of professional fees (primarily legal costs, reflecting a $1.6 million insurance reimbursement for certain costs); $0.8 million of check losses, and $0.7 million of occupancy and equipment costs. Compared to the first quarter of 2009, the first quarter of 2010 reflected the following reductions in expenses: $3.7 million of employee compensation and benefits related to reduced staffing levels; $1.3 million of occupancy and equipment costs; and $0.8 million of advertising and business promotion costs. |
“Expenses not included in core expenses consisted of the following:
(3) | Core expense is a non-GAAP measure that we use to refer to total non-interest expenses excluding tax certificate provisions, debt redemption costs, FDIC special assessments, impairments, restructuring and exit activities. A reconciliation of total expense to core expense is included in BankAtlantic Bancorp’s First Quarter, 2010 Supplemental Financials available at www.BankAtlanticBancorp.com. To view the financial data, access the “Investor Relations” section and click on the “Quarterly Financials or Supplemental Financials” navigation links. |
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• | “Impairment, restructuring and exit chargesof $0.1 million in the first quarter of 2010, $7.7 million in the fourth quarter of 2009, and $2.1 million in the first quarter of 2009. The charges in the first quarter of 2010 were primarily associated with write-downs of real estate owned, and reflected lower write-downs as compared to the fourth quarter of 2009. | ||
• | “Tax certificate provisionof $0.7 million in the first quarter of 2010, $0.7 million in the fourth quarter of 2009 and $1.5 million in the first quarter of 2009. The decline in the 2010 quarter compared to the first quarter of 2009 is due primarily to higher provisions in 2009 associated with certain out-of-state markets where we are no longer actively purchasing tax certificates. | ||
• | “Goodwill impairmentof $0 in both the first quarter of 2010 and the fourth quarter of 2009 compared to a charge of $9.1 million in the first quarter of 2009. | ||
• | “Costs associated with debt redemptionof $7 thousand for the first quarter of 2010, none for the fourth quarter of 2009, and $0.6 million in the first quarter of 2009. These costs were associated with the prepayment of certain borrowings as part of our balance sheet de-leveraging efforts throughout the past year. |
Income Taxes— “Provision for income taxes was $0.1 million in the first quarter of 2010 compared to a benefit of $31.7 million in the fourth quarter of 2009 and $0 in the first quarter of 2009. The tax benefit in the fourth quarter of 2009 was due specifically to legislation enacted in that quarter relating to tax net operating losses (NOLs) which extended the period available for the carry back of NOLs from two years to five years. Excluding the impact of this newly enacted legislation, BankAtlantic would not have recorded a net benefit for income taxes during the fourth quarter of 2009 as it continues to provide for a full deferred tax asset valuation allowance.
Credit:
• | “The provision for loan losses in the first quarter of 2010 was $32.0 million compared to $82.5 million in the fourth quarter of 2009, and $43.5 million in the first quarter of 2009. The provision in the first quarter of 2010 reflects continued elevated levels of delinquencies, charge-offs and non-accrual loans. The decline in provision compared to the fourth quarter of 2009 was primarily due to lower net charge-offs in the Commercial Real Estate portfolio. |
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• | “BankAtlantic’s allowance for loan losses was $169.5 million at March 31, 2010. The allowance coverage to total loans increased to 4.64% at March 31, 2010, compared to 4.53% at December 31, 2009 and 3.41% at March 31, 2009. | ||
• | “The provision for loan losses in the first quarter of 2010 primarily related to our Commercial Real Estate ($15.7 million provision), Consumer ($8.1 million provision), Residential Real Estate ($6.7 million provision) and Commercial Business ($2.2 million provision) loan portfolios. In particular, these portfolios continue to be adversely affected by declining collateral values and negative economic conditions. | ||
• | “Net charge-offs were $36.1 million in the first quarter of 2010, compared to net charge-offs of $74.9 million in the fourth quarter of 2009, and net charge-offs of $22.5 million in the first quarter of 2009. |
– | “First quarter 2010 net charge-offs included $21.3 million in the Commercial Real Estate loan portfolio, $10.6 million in the Consumer Loan portfolio, $4.1 million in the Residential Real Estate loan portfolio and $0.8 million in the Small Business loan portfolio. The decline in net charge-offs compared to the fourth quarter 2009 was primarily the result of fewer valuation impairments in the Commercial Real Estate portfolio in the 2010 quarter. |
• | “Total non-accrual loans were $301.4 million at March 31, 2010, reflecting an increase of $15.2 million from $286.1 million at December 31, 2009, and an increase of $29.9 million from March 31, 2009. The increase in non-accrual loans during the first quarter of 2010 was primarily due to net increases in non-accrual loans of $11.9 million in Residential Real Estate, $1.6 million in Small Business, $0.7 million in Commercial Business, and $1.1 million in Commercial Real Estate loans. Consumer non-accrual loan balances remained essentially unchanged quarter to quarter. | ||
• | “Total non-performing assets were $343.7 million at March 31, 2010, an increase of $19.5 million, or 6.0%, from $324.2 million at December 31, 2009, and an increase of $49.2 million from March 31, 2009. |
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“Other credit information for BankAtlantic’s three largest loan portfolios is further detailed below.
Commercial Real Estate Loans —“We continue to experience losses in our $1.1 billion Commercial Real Estate portfolio as the economic environment continues to adversely impact our borrowers and the values of the underlying collateral.
• | “Net charge-offs in the first quarter of 2010 were $21.3 million, compared to $58.2 million in the fourth quarter of 2009 and $5.3 million in the first quarter of 2009. Of the net charge-offs during the first quarter of 2010, 79% were related to loans that were sold during the quarter. | ||
• | “Delinquencies, excluding non-accrual loans and loans in the process of renewal, increased to $40.6 million, or 3.9% of total loans, at March 31, 2010, compared to $25.5 million, or 2.3% of total loans, at December 31, 2009, and $29.1 million, or 2.4% of total loans, at March 31, 2009. | ||
• | “Commercial Real Estate non-accrual loans at March 31, 2010 were $168.9 million, reflecting an increase of $1.1 million from December 31, 2009, and a decrease of $35.6 million from March 31, 2009. (During the first quarter of 2010, increases in non-accrual loan balances were partially offset by charge-offs, sales and transfers to REO.) | ||
• | “The allowance coverage for Commercial Real Estate loans was 8.16% of the related portfolio at March 31, 2010, compared to 8.21% of the related portfolio at December 31, 2009 and 6.53% at March 31, 2009. |
At March 31, 2010, BankAtlantic’s Commercial Real Estate loan portfolio included the following:
• | “Commercial residential land acquisition, development and construction loans consisting of: |
– | Builder land bank loans:5 loans aggregating $24.3 million, including 4 loans aggregating $23.2 million on non-accrual at March 31, 2010. | ||
– | Land acquisition and development loans:24 loans aggregating $140.8 million, including 10 loans aggregating $60.2 million on non-accrual at March 31, 2010. | ||
– | Land acquisition, development and construction loans:4 loans aggregating $6.7 million, with no loans on non-accrual at March 31, 2010. |
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• | “Commercial land loans: 29 loans aggregating $87.7 million, including 7 loans aggregating $32.2 million on non-accrual at March 31, 2010. | ||
• | “All other Commercial Real Estate loans: Portfolio of $796.0 million, including 17 loans aggregating $49.7 million on non-accrual at March 31, 2010. |
Residential Real Estate Loans—“Our Residential Real Estate loan portfolio was $1.5 billion at March 31, 2010, representing 40.4% of the Bank’s total loans. The purchased residential loan portfolio (representing 94.2% of the total residential loan portfolio) consists of approximately 5,000 first mortgage loans secured by properties throughout the United States. The weighted average FICO score of borrowers in this portfolio was 739 at the time of origination and the original back-end debt ratio, which we calculate as the ratio of total debt payments (inclusive of the fully amortizing residential loan) to income, was a weighted average of 33.9%. Approximately 50.9% of the purchased residential loan portfolio consists of interest-only first mortgage loans which were originated with FICOs and back-end debt ratios consistent with those stated above for the entire portfolio. Standard products in this portfolio have never included subprime, negative amortizing, option-arm or ‘pick-a-payment’ loans.
• | “Net charge-offs for the first quarter of 2010 were $4.1 million, compared to net charge-offs in the fourth quarter of 2009 of $7.5 million and $4.3 million in the first quarter of 2009. | ||
• | “Delinquencies, excluding non-accrual loans, at March 31, 2010 were $26.9 million (compared to $26.7 million at December 31, 2009 and $27.4 million at March 31, 2009), which represented 1.8% of the portfolio at March 31, 2010, compared to 1.7% of the portfolio at December 31, 2009 and 1.5% of the portfolio at March 31, 2009. | ||
• | “Residential Real Estate non-accrual loans at March 31, 2010 were $88.3 million, reflecting an increase of $11.9 million from December 31, 2009, and an increase of $42.6 million from March 31, 2009. | ||
• | “The allowance coverage for Residential Real Estate loans increased during the first quarter of 2010 to 2.01% of the portfolio, compared to 1.74% of the portfolio at December 31, 2009 and 0.64% of the portfolio at March 31, 2009. |
“We continue to expect that the delinquency levels and loss trends in the Residential Real Estate loan portfolio will continue to mirror the broader economy and unemployment trends.
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Consumer Loans —“Our Consumer Loan portfolio had an outstanding balance of $665.3 million at March 31, 2010. Home equity loans represent 97% of the Consumer Loan portfolio. All of our home equity loans were originated by us in our local markets with central underwriting. Approximately 25% of the loans in this portfolio are secured by first mortgages. BankAtlantic does not have a credit card portfolio.
• | “Net charge-offs in the first quarter of 2010 were $10.6 million, compared to | ||
$8.1 million in the fourth quarter of 2009, and $10.2 million in the first quarter of 2009. | |||
• | “Delinquencies, excluding non-accrual loans, decreased to $14.9 million, or 2.2% of the portfolio, at March 31, 2010, compared to $15.2 million, or 2.2% of the portfolio, at December 31, 2009, and $12.4 million, or 1.7% of the portfolio, at March 31, 2009. | ||
• | Consumer non-accrual loans at March 31, 2010 were $14.4 million, essentially unchanged from December 31, 2009 levels, and an increase of $6.4 million from March 31, 2009. | ||
• | “The allowance coverage for Consumer loans at March 31, 2010 was 6.00 % of the portfolio, compared to 6.22% of the portfolio at December 30, 2009, and 5.86% of the portfolio at March 31, 2009. |
BankAtlantic Bancorp (Parent Company level):
Alan B. Levan further commented, “As disclosed previously, BankAtlantic Bancorp has commenced cash offers to purchase $230.0 million of its non-publicly traded outstanding trust preferred securities (TruPS) at a price of $200 per $1,000 principal amount outstanding, or $46.0 million for all of the non-publicly traded outstanding series of TruPS. The completion of these offers, which have been extended until May 20, 2010, is subject to numerous conditions, risks and uncertainties, including our ability to consummate a financing transaction sufficient to fund the purchase of the TruPS tendered in response to the offers and acceptance of a sufficient number of the offers by holders of a requisite amount of each series of TruPS. As disclosed in a Form 8-K filed with the SEC on April 22, 2010, BankAtlantic Bancorp’s dealer manager and solicitation agent for the offers notified the Company that it had received consents from the holders of in excess of 66 2/3% of the most-senior classes of notes issued by Preferred Term Securities IX, Inc. (“PreTSL IX”). PreTSL IX is an issuer of collateralized debt obligations which holds approximately $25.2 million of TruPS issued by BBC Capital Statutory Trust X (the “BBC X TruPS”). The consents directed the trustee of PreTSL IX, The Bank of New York Mellon, to accept our offer for the $25.2 million aggregate principal amount of the BBC X TruPS held by PreTSL IX. The Bank of New York Mellon has advised us that it will not accept the offers in which they are involved without receiving a greater percentage of consents. We disagree with The Bank of New York Mellon’s interpretation and have filed a lawsuit seeking a declaratory judgment and order relating to the required authorizations. Subsequent to the filing of our April 22, 2010 Form 8-K and the filing of the declaratory judgment action, our dealer manager and solicitation agent informed us that certain of the consents previously received with respect to PreTSL IX were withdrawn, bringing consents to slightly below the 66 2/3% threshold we believe is required. We are continuing to solicit consents pursuant to the offers which, unless further extended, will expire on May 20, 2010.
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“Additionally, as originally announced in the first quarter of 2009, we continue to defer the regularly scheduled interest payments on the outstanding junior subordinated debentures relating to all of our TruPS, which is permitted under the terms of the securities for up to 20 consecutive quarterly periods.
“BankAtlantic Bancorp’s net loss at the parent only level was ($3.4) million for the first quarter of 2010, compared to a net loss of ($3.8) million for the fourth quarter of 2009, and a net loss of ($6.0) million for the first quarter of 2009. The net loss in the first quarter of 2010 included a net reversal of prior provisions for loan losses of $1.3 million compared to a net loan loss provision reversal of $1.2 million in the fourth quarter of 2009, and a loan loss provision charge of $0.8 million in the first quarter of 2009.
Asset Workout Subsidiary— “During the first quarter of 2008, Bancorp formed a wholly-owned asset workout subsidiary and purchased certain non-accrual loans from BankAtlantic. These assets are no longer held by BankAtlantic, and any gain or loss associated with these assets has no impact on BankAtlantic’s operations or capital, but will be included in Bancorp’s consolidated results. These assets, as with all other assets and liabilities of Bancorp, should not be combined with those of BankAtlantic when evaluating and comparing metrics for BankAtlantic as the insured financial institution.
“The loans held by the workout subsidiary totaled $38.4 million with specific loan reserves of $8.1 million at March 31, 2010. During the first quarter of 2010, these loans were reduced by sales of $7.9 million and charge-offs of $4.3 million (90% of which were previously reflected in specific loan reserves at December 31, 2009).
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“The composition of the non-accrual loans held by the Company’s asset workout subsidiary at March 31, 2010 was as follows:
• | “Builder land bank loans:One loan totaling $6.0 million. | ||
• | “Land acquisition and development loans:3 loans aggregating $10.4 million. | ||
• | “Land acquisition, development and construction loans:6 loans aggregating $13.5 million. | ||
• | “Commercial business loans:3 loans aggregating $5.5 million.” |
Additional detailed financial data for BankAtlantic (bank only), the Parent — BankAtlantic Bancorp, and consolidated BankAtlantic Bancorp are available atwww.BankAtlanticBancorp.com.
To view the financial data, access the “Investor Relations” section and click on the “Quarterly Financials or Supplemental Financials” navigation links. Additionally, BankAtlantic’s financial information is provided quarterly to the OTS through Thrift Financial Reports, available to the public through the OTS and FDIC websites.
Additionally, copies of BankAtlantic Bancorp’s first quarter 2010 financial results press release and financial data are available upon request via fax, email, or postal service mail. To request a copy, contact BankAtlantic Bancorp’s Investor Relations department using the contact information listed below.
BankAtlantic Bancorp will not be hosting an investor and media teleconference call related to its Financial Results for the First Quarter of 2010, due to the timing of this release and the currently outstanding offers to purchase the TruPS as previously disclosed.
About BankAtlantic Bancorp:
BankAtlantic Bancorp (NYSE: BBX) is a bank holding company and the parent company of BankAtlantic.
BankAtlantic Bancorp (NYSE: BBX) is a bank holding company and the parent company of BankAtlantic.
About BankAtlantic:
BankAtlantic, Florida’s Most Convenient Bank, is one of the largest financial institutions headquartered in Florida. Via its broad network of community branches, online banking division —BankAtlantic.com, and conveniently located ATMs, BankAtlantic provides a full line of personal, small business and commercial banking products and services. BankAtlantic is open 7 days a week with extended weekday hours, Free Online Banking & Bill Pay, a 7-Day Customer Service Center and Change Exchange coin counters.
BankAtlantic, Florida’s Most Convenient Bank, is one of the largest financial institutions headquartered in Florida. Via its broad network of community branches, online banking division —BankAtlantic.com, and conveniently located ATMs, BankAtlantic provides a full line of personal, small business and commercial banking products and services. BankAtlantic is open 7 days a week with extended weekday hours, Free Online Banking & Bill Pay, a 7-Day Customer Service Center and Change Exchange coin counters.
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For further information, please visit our websites:
www.BankAtlanticBancorp.com
www.BankAtlantic.com
www.BankAtlanticBancorp.com
www.BankAtlantic.com
To receive future BankAtlantic Bancorp news releases or announcements directly via Email, please click on the Email Broadcast Sign Up button on our website:www.BankAtlanticBancorp.com.
BankAtlantic Bancorp Contact Info:
Leo Hinkley, Investor and Media Relations Officer
Telephone: (954) 940-5300
Email:InvestorRelations@BankAtlanticBancorp.com
Leo Hinkley, Investor and Media Relations Officer
Telephone: (954) 940-5300
Email:InvestorRelations@BankAtlanticBancorp.com
BankAtlantic, “Florida’s Most Convenient Bank,” Contact Info:
Media Relations:
Sharon Lyn, Vice President
Telephone: 954-940-6383, Fax: 954-940-5320
Email:CorpComm@BankAtlanticBancorp.com
Media Relations:
Sharon Lyn, Vice President
Telephone: 954-940-6383, Fax: 954-940-5320
Email:CorpComm@BankAtlanticBancorp.com
# # #
Except for historical information contained herein, the matters discussed in this press release contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), that involve substantial risks and uncertainties. Actual results, performance, or achievements could differ materially from those contemplated, expressed, or implied by the forward-looking statements contained herein. These forward-looking statements are based largely on the expectations of BankAtlantic Bancorp, Inc. (“the Company”) and are subject to a number of risks and uncertainties that are subject to change based on factors which are, in many instances, beyond the Company’s control. These include, but are not limited to, risks and uncertainties associated with: the impact of economic, competitive and other factors affecting the Company and its operations, markets, products and
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services, including the impact of the changing regulatory environment, a continued or deepening recession, continued decreases in real estate values, and increased unemployment on our business generally, our regulatory capital ratios, the ability of our borrowers to service their obligations and of our customers to maintain account balances and the value of collateral securing our loans; credit risks and loan losses, and the related sufficiency of the allowance for loan losses, including the impact on the credit quality of our loans (including those held in the asset workout subsidiary of the Company) of a sustained downturn in the economy and in the real estate market and other changes in the real estate markets in our trade area, and where our collateral is located; the quality of our real estate based loans including our residential land acquisition and development loans (including Builder land bank loans, Land acquisition and development loans and Land acquisition, development and construction loans) as well as Commercial land loans, other Commercial real estate loans, Residential loans and Consumer loans, and conditions specifically in those market sectors; the quality of our Commercial business loans and conditions specifically in that market sector; the risks of additional charge-offs, impairments and required increases in our allowance for loan losses; changes in interest rates and the effects of, and changes in, trade, monetary and fiscal policies and laws including their impact on the bank’s net interest margin; adverse conditions in the stock market, the public debt market and other financial and credit markets and the impact of such conditions on our activities, the value of our assets and on the ability of our borrowers to service their debt obligations and maintain account balances; BankAtlantic’s initiatives not resulting in continued growth of core deposits or increasing average balances of new deposit accounts or producing results which do not justify the costs; the success of our expense reduction initiatives and the ability to achieve additional cost savings; and the impact of periodic valuation testing of goodwill, deferred tax assets and other assets. Past performance, actual or estimated new account openings and balance growth may not be indicative of future results. Forward-looking statements in this press release relating to the Company’s cash offers to purchase the outstanding TruPS are subject to the risk that a sufficient number of offers are not accepted by the requisite holders of the particular series of TruPS to which each offer relates, that t he trustees do not act even after receiving direction to do so, that we are not successful in obtaining a court order directing the trustee of PreTSL IX to accept our offer to repurchase the TruPS held by PreTSL IX, and that we are not able to obtain financing upon acceptable terms, in amounts sufficient to complete the offers, if at all. In addition to the risks and factors identified above, reference is also made to other risks and factors detailed in reports filed by the Company with the Securities and Exchange Commission, including the Company’s Annual Report on Form 10-K for the year ended December 31, 2009. The Company cautions that the foregoing factors are not exclusive.
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BankAtlantic Bancorp, Inc. and Subsidiaries
Summary of Selected Financial Data (unaudited)
Summary of Selected Financial Data (unaudited)
For the Three Months Ended | ||||||||||||||||||||
3/31/2010 | 12/31/2009 | 9/30/2009 | 6/30/2009 | 3/31/2009 | ||||||||||||||||
Earnings (in thousands): | ||||||||||||||||||||
Net loss from continuing operations | $ | (20,521 | ) | (52,464 | ) | (52,089 | ) | (38,356 | ) | (46,611 | ) | |||||||||
Net loss | $ | (20,521 | ) | (52,464 | ) | (52,589 | ) | (38,356 | ) | (42,410 | ) | |||||||||
Net loss attributable to BankAtlantic Bancorp | $ | (20,729 | ) | (52,464 | ) | (52,589 | ) | (38,356 | ) | (42,410 | ) | |||||||||
Pre-tax core operating earnings — Non-GAAP (note 1) | $ | 11,207 | 5,501 | 18,463 | 12,238 | 10,953 | ||||||||||||||
Average Common Shares Outstanding (in thousands): | ||||||||||||||||||||
Basic | 49,220 | 49,220 | 15,096 | 15,093 | 15,090 | |||||||||||||||
Diluted | 49,220 | 49,220 | 15,096 | 15,093 | 15,090 | |||||||||||||||
Key Performance Ratios | ||||||||||||||||||||
Diluted loss per share from continuing operations (note 2) | $ | (0.42 | ) | (1.07 | ) | (3.45 | ) | (2.54 | ) | (3.09 | ) | |||||||||
Diluted loss per share (note 2) | $ | (0.42 | ) | (1.07 | ) | (3.48 | ) | (2.54 | ) | (2.81 | ) | |||||||||
Return on average tangible assets from continuing operations (note 3) | % | (1.74 | ) | (4.30 | ) | (4.14 | ) | (2.88 | ) | (3.24 | ) | |||||||||
Return on average tangible equity from continuing operations (note 3) | % | (64.56 | ) | (110.64 | ) | (132.56 | ) | (80.39 | ) | (81.46 | ) | |||||||||
Average Balance Sheet Data (in millions): | ||||||||||||||||||||
Assets | $ | 4,744 | 4,894 | 5,046 | 5,351 | 5,775 | ||||||||||||||
Tangible assets — Non-GAAP (note 3) | $ | 4,728 | 4,878 | 5,030 | 5,334 | 5,749 | ||||||||||||||
Loans, gross | $ | 3,799 | 3,991 | 4,134 | 4,302 | 4,435 | ||||||||||||||
Investments | $ | 442 | 497 | 575 | 705 | 947 | ||||||||||||||
Deposits and escrows | $ | 4,013 | 3,988 | 4,046 | 4,089 | 3,986 | ||||||||||||||
Equity | $ | 142 | 201 | 166 | 205 | 250 | ||||||||||||||
Tangible equity — Non-GAAP (note 3) | $ | 127 | 190 | 157 | 191 | 229 | ||||||||||||||
Period End ($ in thousands) | ||||||||||||||||||||
Total loans, net | $ | 3,515,542 | 3,694,326 | 3,845,837 | 4,036,754 | 4,212,536 | ||||||||||||||
Total assets | $ | 4,748,201 | 4,815,617 | 4,941,189 | 5,261,025 | 5,570,760 | ||||||||||||||
Total equity | $ | 119,611 | 141,571 | 189,442 | 166,567 | 207,015 | ||||||||||||||
Class A common shares outstanding | 48,245,042 | 48,245,042 | 48,245,042 | 10,264,106 | 10,259,344 | |||||||||||||||
Class B common shares outstanding | 975,225 | 975,225 | 975,225 | 975,225 | 975,225 | |||||||||||||||
Book value per share | $ | 2.43 | 2.88 | 3.85 | 14.82 | 18.43 | ||||||||||||||
Tangible book value per share — Non-GAAP (note 4) | $ | 2.20 | 2.59 | 3.64 | 13.85 | 17.18 | ||||||||||||||
High stock price for the quarter | $ | 3.24 | 2.96 | 6.68 | 4.75 | 5.67 | ||||||||||||||
Low stock price for the quarter | $ | 1.14 | 1.20 | 2.60 | 1.99 | 0.66 | ||||||||||||||
Closing stock price | $ | 1.77 | 1.30 | 2.90 | 3.86 | 2.01 |
Notes:
(1) | Pre-tax core operating earnings excludes provision for loan losses, cost associated with debt redemption, provision for tax certificates, FDIC special assessment and impairments, restructuring and exit activities. Pre-tax core operating earnings is a non-GAAP measure. See page 19 for a reconciliation of non-GAAP measures to GAAP financial measures. | |
(2) | Diluted and basic loss per share are the same for all periods presented. | |
(3) | Average tangible assets is defined as average total assets less average goodwill and core deposit intangibles. Average tangible equity is defined as average total equity less average goodwill, core deposit intangibles and other comprehensive income. Average tangible assets and average tangible equity are non-GAAP measures. See page 19 for a reconciliation of non-GAAP measures to GAAP financial measures. | |
(4) | Tangible book value per share is defined as equity less goodwill and core deposit intangibles divided by the number of common shares outstanding. Tangible book value per share is a non-GAAP measure. See page 19 for a reconciliation of non-GAAP measures to GAAP financial measures. |
14
BankAtlantic Bancorp, Inc. and Subsidiaries
Consolidated Statements of Financial Condition (unaudited)
Consolidated Statements of Financial Condition (unaudited)
March 31, | December 31, | |||||||
(in thousands) | 2010 | 2009 | ||||||
ASSETS | ||||||||
Cash and cash equivalents | $ | 444,476 | 234,797 | |||||
Securities available for sale (at fair value) | 243,785 | 320,327 | ||||||
Investment securities (approximate fair value: $1,500 and $1,500) | 1,500 | 1,500 | ||||||
Tax certificates, net of allowance of $7,341 and $6,781 | 88,438 | 110,991 | ||||||
Loans receivable, net of allowance for loan losses of $177,597 and $187,218 | 3,515,542 | 3,694,326 | ||||||
Federal Home Loan Bank stock, at cost which approximates fair value | 48,751 | 48,751 | ||||||
Real estate held for development and sale | 14,462 | 13,694 | ||||||
Real estate owned | 51,365 | 46,477 | ||||||
Office properties and equipment, net | 197,693 | 201,686 | ||||||
Goodwill and other intangible assets | 15,494 | 15,817 | ||||||
Other assets | 126,695 | 127,251 | ||||||
Total assets | $ | 4,748,201 | 4,815,617 | |||||
LIABILITIES AND EQUITY | ||||||||
Liabilities: | ||||||||
Deposits | ||||||||
Demand | $ | 900,984 | 827,580 | |||||
Savings | 443,288 | 412,360 | ||||||
NOW | 1,501,274 | 1,409,138 | ||||||
Money market | 361,877 | 360,043 | ||||||
Certificates of deposit | 840,017 | 960,559 | ||||||
Total deposits | 4,047,440 | 3,969,680 | ||||||
Advances from FHLB | 152,008 | 282,012 | ||||||
Securities sold under agreements to repurchase | 24,674 | 24,468 | ||||||
Federal funds purchased and other short term borrowings | 2,628 | 2,803 | ||||||
Subordinated debentures and bonds payable | 22,000 | 22,697 | ||||||
Junior subordinated debentures | 311,707 | 308,334 | ||||||
Other liabilities | 68,133 | 64,052 | ||||||
Total liabilities | 4,628,590 | 4,674,046 | ||||||
Equity: | ||||||||
Common stock | 509 | 493 | ||||||
Additional paid-in capital | 297,025 | 296,438 | ||||||
Accumulated deficit | (174,163 | ) | (153,434 | ) | ||||
Accumulated other comprehensive loss | (4,141 | ) | (1,926 | ) | ||||
Total BankAtlantic Bancorp stockholders’ equity | 119,230 | 141,571 | ||||||
Noncontrolling interests | 381 | — | ||||||
Total equity | 119,611 | 141,571 | ||||||
Total liabilities and equity | $ | 4,748,201 | 4,815,617 | |||||
15
BankAtlantic Bancorp, Inc. and Subsidiaries
Consolidated Statements of Operations (unaudited)
Consolidated Statements of Operations (unaudited)
For the Three Months Ended | ||||||||||||||||||||
(in thousands) | 3/31/2010 | 12/31/2009 | 9/30/2009 | 6/30/2009 | 3/31/2009 | |||||||||||||||
INTEREST INCOME: | ||||||||||||||||||||
Interest and fees on loans | $ | 41,150 | 43,056 | 45,028 | 47,747 | 49,678 | ||||||||||||||
Interest on securities available for sale | 3,645 | 3,889 | 4,766 | 6,328 | 8,559 | |||||||||||||||
Interest on tax certificates | 2,356 | 2,975 | 3,793 | 3,061 | 4,193 | |||||||||||||||
Interest and dividends on investments | 153 | 136 | 161 | 44 | 179 | |||||||||||||||
Total interest income | 47,304 | 50,056 | 53,748 | 57,180 | 62,609 | |||||||||||||||
INTEREST EXPENSE: | ||||||||||||||||||||
Interest on deposits | 7,057 | 7,950 | 9,420 | 11,527 | 12,987 | |||||||||||||||
Interest on advances from FHLB | 958 | 1,783 | 2,494 | 5,082 | 7,164 | |||||||||||||||
Interest on short-term borrowed funds | 8 | 9 | 9 | 19 | 172 | |||||||||||||||
Interest on long-term debt | 3,791 | 3,824 | 3,973 | 4,280 | 4,538 | |||||||||||||||
Total interest expense | 11,814 | 13,566 | 15,896 | 20,908 | 24,861 | |||||||||||||||
NET INTEREST INCOME | 35,490 | 36,490 | 37,852 | 36,272 | 37,748 | |||||||||||||||
Provision for loan losses | 30,755 | 81,301 | 63,586 | 43,494 | 44,277 | |||||||||||||||
NET INTEREST INCOME AFTER PROVISION | 4,735 | (44,811 | ) | (25,734 | ) | (7,222 | ) | (6,529 | ) | |||||||||||
NON-INTEREST INCOME: | ||||||||||||||||||||
Service charges on deposits | 15,048 | 17,940 | 19,767 | 19,347 | 18,685 | |||||||||||||||
Other service charges and fees | 7,378 | 7,103 | 7,355 | 8,059 | 7,025 | |||||||||||||||
Securities activities, net | 3,138 | 1,273 | 4,774 | 693 | 4,440 | |||||||||||||||
Other | 3,384 | 3,267 | 3,711 | 3,423 | 2,959 | |||||||||||||||
Total non-interest income | 28,948 | 29,583 | 35,607 | 31,522 | 33,109 | |||||||||||||||
NON-INTEREST EXPENSE: | ||||||||||||||||||||
Employee compensation and benefits | 25,378 | 28,628 | 24,876 | 25,935 | 28,806 | |||||||||||||||
Occupancy and equipment | 13,582 | 14,270 | 14,553 | 14,842 | 14,911 | |||||||||||||||
Advertising and business promotion | 1,944 | 2,286 | 1,549 | 1,979 | 2,832 | |||||||||||||||
Professional fees | 2,887 | 5,138 | 3,470 | 2,695 | 3,326 | |||||||||||||||
Check losses | 432 | 1,207 | 1,146 | 991 | 844 | |||||||||||||||
Supplies and postage | 998 | 1,135 | 1,035 | 999 | 1,004 | |||||||||||||||
Telecommunication | 534 | 844 | 353 | 586 | 698 | |||||||||||||||
Cost associated with debt redemption | 7 | — | 5,431 | 1,441 | 591 | |||||||||||||||
Provision for tax certificates | 733 | 686 | (198 | ) | 1,414 | 1,486 | ||||||||||||||
Impairment of goodwill | — | — | — | — | 9,124 | |||||||||||||||
Impairment, restructuring and exit activities | 143 | 7,700 | 1,730 | 1,817 | 2,086 | |||||||||||||||
FDIC special assessment | — | — | — | 2,428 | — | |||||||||||||||
Other | 7,476 | 7,064 | 8,014 | 7,529 | 7,483 | |||||||||||||||
Total non-interest expense | 54,114 | 68,958 | 61,959 | 62,656 | 73,191 | |||||||||||||||
Loss from continuing operationsbefore income taxes | (20,431 | ) | (84,186 | ) | (52,086 | ) | (38,356 | ) | (46,611 | ) | ||||||||||
Provision (benefit) for income taxes | 90 | (31,722 | ) | 3 | — | — | ||||||||||||||
Loss from continuing operations | (20,521 | ) | (52,464 | ) | (52,089 | ) | (38,356 | ) | (46,611 | ) | ||||||||||
Discontinued operations | — | — | (500 | ) | — | 4,201 | ||||||||||||||
Net loss | (20,521 | ) | (52,464 | ) | (52,589 | ) | (38,356 | ) | (42,410 | ) | ||||||||||
Less: net income attributable to noncontrolling interest | (208 | ) | — | — | — | — | ||||||||||||||
Net loss attributable to BankAtlantic Bancorp | $ | (20,729 | ) | (52,464 | ) | (52,589 | ) | (38,356 | ) | (42,410 | ) | |||||||||
16
BankAtlantic Bancorp, Inc. and Subsidiaries
Consolidated Average Balance Sheet (unaudited)
Consolidated Average Balance Sheet (unaudited)
For the Three Months Ended | ||||||||||||||||||||
(in thousands except percentages and per share data) | 3/31/2010 | 12/31/2009 | 9/30/2009 | 6/30/2009 | 3/31/2009 | |||||||||||||||
Loans: | ||||||||||||||||||||
Residential real estate | $ | 1,513,302 | 1,600,027 | 1,698,715 | 1,821,553 | 1,916,589 | ||||||||||||||
Commercial real estate | 1,148,435 | 1,228,250 | 1,262,163 | 1,291,536 | 1,305,809 | |||||||||||||||
Consumer | 688,173 | 700,254 | 717,473 | 730,988 | 744,371 | |||||||||||||||
Commercial business | 139,843 | 150,467 | 140,621 | 141,254 | 146,703 | |||||||||||||||
Small business | 309,549 | 312,485 | 314,672 | 316,287 | 321,991 | |||||||||||||||
Total Loans | 3,799,302 | 3,991,483 | 4,133,644 | 4,301,618 | 4,435,463 | |||||||||||||||
Investments | 441,647 | 496,510 | 575,183 | 704,874 | 947,219 | |||||||||||||||
Total interest earning assets | 4,240,949 | 4,487,993 | 4,708,827 | 5,006,492 | 5,382,682 | |||||||||||||||
Goodwill and core deposit intangibles | 15,652 | 15,973 | 16,297 | 16,618 | 25,971 | |||||||||||||||
Other non-interest earning assets | 487,137 | 389,874 | 321,070 | 327,876 | 365,847 | |||||||||||||||
Total assets | $ | 4,743,738 | 4,893,840 | 5,046,194 | 5,350,986 | 5,774,500 | ||||||||||||||
Tangible assets — Non-GAAP (note 3) | $ | 4,728,086 | 4,877,867 | 5,029,897 | 5,334,368 | 5,748,529 | ||||||||||||||
Deposits: | ||||||||||||||||||||
Demand deposits | $ | 864,413 | 844,052 | 808,817 | 810,006 | 775,982 | ||||||||||||||
Savings | 425,235 | 421,032 | 431,516 | 451,122 | 441,278 | |||||||||||||||
NOW | 1,467,103 | 1,312,073 | 1,237,459 | 1,159,531 | 1,047,116 | |||||||||||||||
Money market | 360,470 | 372,081 | 392,344 | 412,065 | 421,883 | |||||||||||||||
Certificates of deposit | 896,074 | 1,038,920 | 1,175,821 | 1,256,299 | 1,300,056 | |||||||||||||||
Total deposits | 4,013,295 | 3,988,158 | 4,045,957 | 4,089,023 | 3,986,315 | |||||||||||||||
Short-term borrowed funds | 26,332 | 30,812 | 31,905 | 45,433 | 253,317 | |||||||||||||||
FHLB advances | 173,011 | 282,015 | 410,628 | 625,254 | 903,077 | |||||||||||||||
Long-term debt | 331,403 | 328,222 | 324,729 | 320,945 | 317,184 | |||||||||||||||
Total borrowings | 530,746 | 641,049 | 767,262 | 991,632 | 1,473,578 | |||||||||||||||
Other liabilities | 57,755 | 63,979 | 66,855 | 65,599 | 65,092 | |||||||||||||||
Total liabilities | 4,601,796 | 4,693,186 | 4,880,074 | 5,146,254 | 5,524,985 | |||||||||||||||
Equity | 141,942 | 200,654 | 166,120 | 204,732 | 249,515 | |||||||||||||||
Total liabilities and equity | $ | 4,743,738 | 4,893,840 | 5,046,194 | 5,350,986 | 5,774,500 | ||||||||||||||
Other comprehensive (loss) income in equity | (846 | ) | (4,999 | ) | (7,356 | ) | (2,729 | ) | (5,347 | ) | ||||||||||
Tangible equity — Non-GAAP (note 3) | $ | 127,136 | 189,680 | 157,179 | 190,843 | 228,891 | ||||||||||||||
Net Interest Margin | 3.33 | % | 3.26 | % | 3.23 | % | 2.89 | % | 2.78 | % | ||||||||||
17
Consolidated BankAtlantic Bancorp, Inc. and Subsidiaries
Nonperforming Assets and Credit Quality Statistics
Nonperforming Assets and Credit Quality Statistics
As of | ||||||||||||||||||||
(in thousands) | 3/31/2010 | 12/31/2009 | 9/30/2009 | 6/30/2009 | 3/31/2009 | |||||||||||||||
Nonaccrual loans: | ||||||||||||||||||||
BankAtlantic | $ | 301,365 | 286,120 | 294,865 | 295,448 | 271,444 | ||||||||||||||
Parent- Work out Sub | 35,326 | 44,897 | 53,520 | 64,558 | 74,321 | |||||||||||||||
Consolidated nonaccrual loans | $ | 336,691 | 331,017 | 348,385 | 360,006 | 345,765 | ||||||||||||||
Net Charge-offs: | ||||||||||||||||||||
BankAtlantic | $ | (36,074 | ) | (74,910 | ) | (43,092 | ) | (25,773 | ) | (22,453 | ) | |||||||||
Parent- Work out Sub | (4,302 | ) | (3,836 | ) | (8,051 | ) | (3,898 | ) | (684 | ) | ||||||||||
Consolidated charge-offs | $ | (40,376 | ) | (78,746 | ) | (51,143 | ) | (29,671 | ) | (23,137 | ) | |||||||||
Loan Provision: | ||||||||||||||||||||
BankAtlantic | $ | 32,034 | 82,523 | 52,246 | 35,955 | 43,520 | ||||||||||||||
Parent- Work out Sub | (1,279 | ) | (1,222 | ) | 11,340 | 7,539 | 757 | |||||||||||||
Consolidated loan provision | $ | 30,755 | 81,301 | 63,586 | 43,494 | 44,277 | ||||||||||||||
Allowance for Loan Loss: | ||||||||||||||||||||
BankAtlantic | $ | 169,548 | 173,588 | 165,975 | 156,821 | 146,639 | ||||||||||||||
Parent- Work out Sub | 8,049 | 13,630 | 18,688 | 15,399 | 11,758 | |||||||||||||||
Consolidated allowance for loan loss | $ | 177,597 | 187,218 | 184,663 | 172,220 | 158,397 | ||||||||||||||
Nonperforming Assets: | ||||||||||||||||||||
BankAtlantic | $ | 343,693 | 324,226 | 328,685 | 328,775 | 294,505 | ||||||||||||||
Parent- Work out Sub | 45,858 | 55,429 | 59,787 | 68,640 | 74,321 | |||||||||||||||
Consolidated nonperforming assets | $ | 389,551 | 379,655 | 388,472 | 397,415 | 368,826 | ||||||||||||||
Consolidated Credit Quality Statistics | ||||||||||||||||||||
Allowance for loan losses to total loans | % | 4.81 | 4.82 | 4.58 | 4.09 | 3.62 | ||||||||||||||
Allowance to nonaccrual loans | % | 52.75 | 56.56 | 53.01 | 47.84 | 45.81 | ||||||||||||||
Provision to average loans | % | 3.24 | 8.15 | 6.15 | 4.04 | 3.99 | ||||||||||||||
Nonperforming loans, gross to total assets | % | 7.09 | 6.87 | 7.05 | 6.84 | 6.21 | ||||||||||||||
Nonperforming assets, gross to total assets | % | 8.20 | 7.88 | 7.86 | 7.55 | 6.62 |
18
BankAtlantic Bancorp, Inc. and Subsidiaries
Reconciliation of GAAP Financial Measures to Non-GAAP Measures
Reconciliation of GAAP Financial Measures to Non-GAAP Measures
Management uses non-GAAP financial measures to supplement its GAAP financial information and to provide additional useful measures in the evaluation of the Company’s operating results and any related trends that may be affecting the Company’s business. Management uses pre-tax core operating earnings to measure the Company’s ongoing financial performance excluding items that are not currently controllable by management. Management uses book value per share and tangible book value per share to enable investors to compare these measures to the quoted market price of the Company’s Class A common stock and to other companies in the industry. The return on average tangible equity and average tangible assets is used by management to measure the Company’s effectiveness in its use of capital and assets, respectively, and to allow for comparison to other companies in the industry. These disclosures should not be viewed as a substitute for operating results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies.
Reconciliation of loss from continuing operations before income taxes to pre-tax core operating earnings
For the Three Months Ended | ||||||||||||||||||||
(in thousands) | 3/31/2010 | 12/31/2009 | 9/30/2009 | 6/30/2009 | 3/31/2009 | |||||||||||||||
Loss from continuing operationsbefore income taxes | $ | (20,431 | ) | (84,186 | ) | (52,086 | ) | (38,356 | ) | (46,611 | ) | |||||||||
Costs associated with debt redemption | 7 | — | 5,431 | 1,441 | 591 | |||||||||||||||
Provision for tax certificates | 733 | 686 | (198 | ) | 1,414 | 1,486 | ||||||||||||||
Impairment of goodwill | — | — | — | — | 9,124 | |||||||||||||||
Impairment, restructuring and exit activities | 143 | 7,700 | 1,730 | 1,817 | 2,086 | |||||||||||||||
FDIC special assessment | — | — | — | 2,428 | — | |||||||||||||||
Provision for loan losses | 30,755 | 81,301 | 63,586 | 43,494 | 44,277 | |||||||||||||||
Non-GAAP pre-tax core operating earnings | $ | 11,207 | 5,501 | 18,463 | 12,238 | 10,953 | ||||||||||||||
Reconciliation of equity to tangible book value per share
For the Three Months Ended | ||||||||||||||||||||
(in thousands) | 3/31/2010 | 12/31/2009 | 9/30/2009 | 6/30/2009 | 3/31/2009 | |||||||||||||||
Equity | $ | 119,611 | 141,571 | 189,442 | 166,567 | 207,015 | ||||||||||||||
Goodwill and core deposit intangibles | (15,494 | ) | (15,817 | ) | (16,139 | ) | (16,461 | ) | (16,784 | ) | ||||||||||
Other comprehensive loss | 4,141 | 1,926 | 5,836 | 5,540 | 2,750 | |||||||||||||||
Tangible book value | $ | 108,258 | 127,680 | 179,139 | 155,646 | 192,981 | ||||||||||||||
Common shares outstanding, period end | 49,220,267 | 49,220,267 | 49,220,267 | 11,239,331 | 11,234,569 | |||||||||||||||
Book value per share | $ | 2.43 | 2.88 | 3.85 | 14.82 | 18.43 | ||||||||||||||
Tangible book value per share — Non-GAAP | $ | 2.20 | 2.59 | 3.64 | 13.85 | 17.18 | ||||||||||||||
Reconciliation of loss from continuing operations before income taxes to pre-tax core operating earnings
For the Three Months Ended | ||||||||||||||||||||
(in thousands) | 3/31/2010 | 12/31/2009 | 9/30/2009 | 6/30/2009 | 3/31/2009 | |||||||||||||||
Net loss from continuing operations | $ | (20,521 | ) | (52,464 | ) | (52,089 | ) | (38,356 | ) | (46,611 | ) | |||||||||
Average total assets | 4,743,738 | 4,893,840 | 5,046,194 | 5,350,986 | 5,774,500 | |||||||||||||||
Average goodwill and core deposit intangibles | (15,652 | ) | (15,973 | ) | (16,297 | ) | (16,618 | ) | (25,971 | ) | ||||||||||
Average tangible assets | 4,728,086 | 4,877,867 | 5,029,897 | 5,334,368 | 5,748,529 | |||||||||||||||
Average equity | 141,942 | 200,654 | 166,120 | 204,732 | 249,515 | |||||||||||||||
Average goodwill and core deposit intangibles | (15,652 | ) | (15,973 | ) | (16,297 | ) | (16,618 | ) | (25,971 | ) | ||||||||||
Other comprehensive loss | 846 | 4,999 | 7,356 | 2,729 | 5,347 | |||||||||||||||
Average tangible equity | $ | 127,136 | 189,680 | 157,179 | 190,843 | 228,891 | ||||||||||||||
Return on average assets from continuing operations | -1.73 | % | -4.29 | % | -4.13 | % | -2.87 | % | -3.23 | % | ||||||||||
Return on average tangible assets from continuing operations — Non-GAAP | -1.74 | % | -4.30 | % | -4.14 | % | -2.88 | % | -3.24 | % | ||||||||||
Return on average equity from continuing operations | -57.83 | % | -104.59 | % | -125.42 | % | -74.94 | % | -74.72 | % | ||||||||||
Return on average tangible equity from continuing operations — Non-GAAP | -64.56 | % | -110.64 | % | -132.56 | % | -80.39 | % | -81.46 | % | ||||||||||
19
BankAtlantic (Bank Operations Business Segment)
Summary of Selected Financial Data (unaudited)
Summary of Selected Financial Data (unaudited)
For the Three Months Ended | ||||||||||||||||||||
(in thousands except percentages) | 3/31/2010 | 12/31/2009 | 9/30/2009 | 6/30/2009 | 3/31/2009 | |||||||||||||||
Statistics: | ||||||||||||||||||||
Average interest earning assets | $ | 4,193,544 | 4,432,275 | 4,640,967 | 4,929,849 | 5,291,754 | ||||||||||||||
Average interest bearing liabilities | $ | 3,383,776 | 3,494,040 | 3,717,691 | 3,992,654 | 4,414,439 | ||||||||||||||
Period end borrowings to deposits and borrowings | % | 4.84 | 8.00 | 9.52 | 14.12 | 19.12 | ||||||||||||||
Efficiency ratio | % | 77.86 | 96.82 | 77.99 | 83.83 | 96.07 | ||||||||||||||
Yield on interest earning assets | % | 4.51 | 4.51 | 4.63 | 4.62 | 4.72 | ||||||||||||||
Cost of interest-bearing liabilities | % | 0.99 | 1.13 | 1.30 | 1.70 | 1.90 | ||||||||||||||
Interest spread | % | 3.52 | 3.38 | 3.33 | 2.92 | 2.82 | ||||||||||||||
Net interest margin | % | 3.71 | 3.62 | 3.59 | 3.24 | 3.14 | ||||||||||||||
Non-GAAP Measures (Note 1) | ||||||||||||||||||||
Average tangible assets | $ | 4,668,854 | 4,819,572 | 4,959,000 | 5,254,284 | 5,648,268 | ||||||||||||||
Average tangible equity | $ | 367,220 | 425,344 | 376,006 | 391,404 | 401,665 | ||||||||||||||
Pre-tax core operating earnings | $ | 15,878 | 10,550 | 23,908 | 18,877 | 16,218 | ||||||||||||||
Core operating efficiency ratio | % | 76.55 | 95.53 | 68.94 | 74.09 | 78.27 | ||||||||||||||
Return on average tangible assets | % | (1.47 | ) | (4.04 | ) | (2.85 | ) | (1.84 | ) | (2.87 | ) | |||||||||
Return on average tangible equity | % | (18.66 | ) | (45.74 | ) | (37.56 | ) | (24.71 | ) | (40.42 | ) | |||||||||
Tangible capital to tangible assets | % | 7.55 | 7.66 | 8.37 | 7.09 | 7.10 | ||||||||||||||
Earning assets repricing at period end: | ||||||||||||||||||||
Percent of earning assets that have fixed rates | % | 48 | 48 | 49 | 51 | 50 | ||||||||||||||
Percent of earning assets that have variable rates | % | 52 | 52 | 51 | 49 | 50 | ||||||||||||||
Regulatory capital ratios and statistics at period end | ||||||||||||||||||||
Total risk-based capital | % | 12.86 | 12.56 | 13.51 | 11.81 | 11.86 | ||||||||||||||
Tier I risk-based capital | % | 10.90 | 10.63 | 11.60 | 9.93 | 10.01 | ||||||||||||||
Core capital | % | 7.51 | 7.58 | 8.31 | 7.01 | 6.97 | ||||||||||||||
Risk-weighted assets | 3,206,075 | 3,364,662 | 3,470,256 | 3,636,582 | 3,789,181 | |||||||||||||||
Adjusted total assets | 4,656,270 | 4,720,917 | 4,843,459 | 5,148,806 | 5,444,708 |
Note 1
See page 26 for a reconciliation of non-GAAP measures to GAAP financial measures.
20
BankAtlantic (Bank Operations Business Segment)
Condensed Statements of Operations (unaudited)
Condensed Statements of Operations (unaudited)
For the Three Months Ended | ||||||||||||||||||||
(in thousands) | 3/31/2010 | 12/31/2009 | 9/30/2009 | 6/30/2009 | 3/31/2009 | |||||||||||||||
Net interest income | $ | 38,975 | 39,992 | 41,485 | 40,078 | 41,769 | ||||||||||||||
Provision for loan losses | 32,034 | 82,523 | 52,246 | 35,955 | 43,520 | |||||||||||||||
Net interest income after provision for loan losses | 6,941 | (42,531 | ) | (10,761 | ) | 4,123 | (1,751 | ) | ||||||||||||
Non-interest income | ||||||||||||||||||||
Service charges on deposits | 15,048 | 17,940 | 19,767 | 19,347 | 18,685 | |||||||||||||||
Other service charges and fees | 7,378 | 7,103 | 7,355 | 8,059 | 7,025 | |||||||||||||||
Securities activities, net | 3,132 | — | 4,774 | 2,067 | 4,320 | |||||||||||||||
Other non-interest income | 3,183 | 3,116 | 3,596 | 3,303 | 2,835 | |||||||||||||||
Total non-interest income | 28,741 | 28,159 | 35,492 | 32,776 | 32,865 | |||||||||||||||
Non-interest expense | ||||||||||||||||||||
Employee compensation and benefits | 24,374 | 26,229 | 23,917 | 24,985 | 28,078 | |||||||||||||||
Occupancy and equipment | 13,581 | 14,269 | 14,553 | 14,842 | 14,910 | |||||||||||||||
Advertising and business promotion | 1,934 | 2,254 | 1,514 | 1,846 | 2,781 | |||||||||||||||
Professional fees | 2,565 | 4,542 | 2,752 | 2,336 | 2,944 | |||||||||||||||
Check losses | 432 | 1,207 | 1,146 | 991 | 844 | |||||||||||||||
Supplies and postage | 965 | 1,106 | 987 | 991 | 1,000 | |||||||||||||||
Telecommunication | 529 | 842 | 348 | 580 | 694 | |||||||||||||||
Cost associated with debt redemption | 7 | — | 5,431 | 1,441 | 591 | |||||||||||||||
Provision for tax certificates | 733 | 686 | (198 | ) | 1,414 | 1,486 | ||||||||||||||
Impairment of goodwill | — | — | — | — | 9,124 | |||||||||||||||
Impairment, restructuring and exit activities | 143 | 7,700 | 1,730 | 1,817 | 2,086 | |||||||||||||||
FDIC special assessment | — | — | — | 2,428 | — | |||||||||||||||
Other | 7,458 | 7,152 | 7,852 | 7,406 | 7,165 | |||||||||||||||
Total non-interest expense | 52,721 | 65,987 | 60,032 | 61,077 | 71,703 | |||||||||||||||
Loss from bank operations business segment before income taxes | (17,039 | ) | (80,359 | ) | (35,301 | ) | (24,178 | ) | (40,589 | ) | ||||||||||
Provision (benefit) for income taxes | 90 | (31,722 | ) | 3 | — | — | ||||||||||||||
Net loss from bank operations business segment | (17,129 | ) | (48,637 | ) | (35,304 | ) | (24,178 | ) | (40,589 | ) | ||||||||||
Less: net income attributable to noncontrolling interest | (208 | ) | — | — | — | — | ||||||||||||||
Net loss attributable to BankAtlantic | $ | (17,337 | ) | (48,637 | ) | (35,304 | ) | (24,178 | ) | (40,589 | ) | |||||||||
21
BankAtlantic (Bank Operations Business Segment)
Condensed Statements of Financial Condition (unaudited)
Condensed Statements of Financial Condition (unaudited)
As of | ||||||||||||||||||||
(in thousands) | 3/31/2010 | 12/31/2009 | 9/30/2009 | 6/30/2009 | 3/31/2009 | |||||||||||||||
ASSETS | ||||||||||||||||||||
Loans receivable, net | $ | 3,485,228 | 3,659,943 | 3,807,800 | 3,984,305 | 4,147,713 | ||||||||||||||
Investment securities | 137,189 | 159,742 | 187,152 | 227,861 | 221,392 | |||||||||||||||
Available for sale securities | 243,779 | 320,322 | 355,340 | 431,762 | 518,871 | |||||||||||||||
Goodwill | 13,081 | 13,081 | 13,081 | 13,081 | 13,081 | |||||||||||||||
Core deposit intangible asset | 2,413 | 2,736 | 3,058 | 3,380 | 3,703 | |||||||||||||||
Other assets | 806,311 | 599,298 | 515,954 | 529,322 | 583,843 | |||||||||||||||
Total assets | $ | 4,688,001 | 4,755,122 | 4,882,385 | 5,189,711 | 5,488,603 | ||||||||||||||
LIABILITIES AND EQUITY | ||||||||||||||||||||
Deposits | ||||||||||||||||||||
Demand | $ | 900,984 | 827,580 | 809,749 | 802,446 | 798,687 | ||||||||||||||
Savings | 443,288 | 412,360 | 425,508 | 438,127 | 457,991 | |||||||||||||||
NOW | 1,501,274 | 1,409,138 | 1,238,542 | 1,187,742 | 1,084,744 | |||||||||||||||
Money market | 361,877 | 360,043 | 372,442 | 395,903 | 413,777 | |||||||||||||||
Certificates of deposit | 840,017 | 960,559 | 1,113,238 | 1,230,829 | 1,298,114 | |||||||||||||||
Total deposits | 4,047,440 | 3,969,680 | 3,959,479 | 4,055,047 | 4,053,313 | |||||||||||||||
Advances from Federal Home Loan Bank | 152,008 | 282,012 | 342,016 | 597,020 | 817,024 | |||||||||||||||
Short term borrowings | 31,797 | 40,657 | 51,825 | 47,039 | 118,077 | |||||||||||||||
Long term debt | 22,000 | 22,697 | 22,738 | 22,781 | 22,822 | |||||||||||||||
Other liabilities | 66,574 | 61,175 | 83,085 | 84,454 | 72,279 | |||||||||||||||
Total liabilities | 4,319,819 | 4,376,221 | 4,459,143 | 4,806,341 | 5,083,515 | |||||||||||||||
Equity | 368,182 | 378,901 | 423,242 | 383,370 | 405,088 | |||||||||||||||
Total liabilities and equity | $ | 4,688,001 | 4,755,122 | 4,882,385 | 5,189,711 | 5,488,603 | ||||||||||||||
22
BankAtlantic (Bank Operations Business Segment)
Average Balance Sheet — Yield / Rate Analysis
Average Balance Sheet — Yield / Rate Analysis
For the Three Months Ended | |||||||||||||||||||||||||||
March 31, 2010 | March 31, 2009 | ||||||||||||||||||||||||||
Average | Revenue/ | Yield/ | Average | Revenue/ | Yield/ | ||||||||||||||||||||||
( in thousands) | Balance | Expense | Rate | Balance | Expense | Rate | |||||||||||||||||||||
Loans: | |||||||||||||||||||||||||||
Residential real estate | $ | 1,513,302 | 18,901 | 5.00 | % | $ | 1,916,589 | 25,065 | 5.23 | % | |||||||||||||||||
Commercial real estate | 1,102,576 | 10,843 | 3.93 | 1,227,700 | 12,141 | 3.96 | |||||||||||||||||||||
Consumer | 688,173 | 4,900 | 2.85 | 744,371 | 5,411 | 2.91 | |||||||||||||||||||||
Commercial business | 138,307 | 1,608 | 4.65 | 145,167 | 1,957 | 5.39 | |||||||||||||||||||||
Small business | 309,549 | 4,843 | 6.26 | 321,991 | 5,033 | 6.25 | |||||||||||||||||||||
Total loans | 3,751,907 | 41,095 | 4.38 | 4,355,818 | 49,607 | 4.56 | |||||||||||||||||||||
Investments | 441,637 | 6,136 | 5.56 | 935,936 | 12,803 | 5.47 | |||||||||||||||||||||
Total interest earning assets | 4,193,544 | 47,231 | 4.51 | % | 5,291,754 | 62,410 | 4.72 | % | |||||||||||||||||||
Goodwill and core deposit intangibles | 15,652 | 25,971 | |||||||||||||||||||||||||
Other non-interest earning assets | 475,310 | 356,514 | |||||||||||||||||||||||||
Total Assets | $ | 4,684,506 | $ | 5,674,239 | |||||||||||||||||||||||
Deposits: | |||||||||||||||||||||||||||
Savings | $ | 425,235 | 333 | 0.32 | % | $ | 441,278 | 500 | 0.46 | % | |||||||||||||||||
NOW | 1,467,103 | 2,218 | 0.61 | 1,047,116 | 1,413 | 0.55 | |||||||||||||||||||||
Money market | 360,470 | 629 | 0.71 | 421,883 | 773 | 0.74 | |||||||||||||||||||||
Certificates of deposit | 896,074 | 3,877 | 1.75 | 1,300,056 | 10,301 | 3.21 | |||||||||||||||||||||
Total interest bearing deposits | 3,148,882 | 7,057 | 0.91 | 3,210,333 | 12,987 | 1.64 | |||||||||||||||||||||
Short-term borrowed funds | 39,376 | 13 | 0.13 | 278,209 | 182 | 0.27 | |||||||||||||||||||||
Advances from FHLB | 173,011 | 958 | 2.25 | 903,077 | 7,164 | 3.22 | |||||||||||||||||||||
Long-term debt | 22,507 | 228 | 4.11 | 22,820 | 308 | 5.47 | |||||||||||||||||||||
Total interest bearing liabilities | 3,383,776 | 8,256 | 0.99 | 4,414,439 | 20,641 | 1.90 | |||||||||||||||||||||
Demand deposits | 864,391 | 775,977 | |||||||||||||||||||||||||
Non-interest bearing other liabilities | 54,312 | 61,523 | |||||||||||||||||||||||||
Total Liabilities | 4,302,479 | 5,251,939 | |||||||||||||||||||||||||
Equity | 382,027 | 422,300 | |||||||||||||||||||||||||
Total liabilities and equity | $ | 4,684,506 | $ | 5,674,239 | |||||||||||||||||||||||
Net interest income/net interest spread | 38,975 | 3.52 | % | 41,769 | 2.82 | % | |||||||||||||||||||||
Margin | |||||||||||||||||||||||||||
Interest income/interest earning assets | 4.51 | % | 4.72 | % | |||||||||||||||||||||||
Interest expense/interest earning assets | 0.80 | 1.58 | |||||||||||||||||||||||||
Net interest margin | 3.71 | % | 3.14 | % | |||||||||||||||||||||||
23
BankAtlantic (Bank Operations Business Segment)
Allowance for Loan Loss and Credit Quality
Allowance for Loan Loss and Credit Quality
For the Three Months Ended | ||||||||||||||||||||
(in thousands) | 3/31/2010 | 12/31/2009 | 9/30/2009 | 6/30/2009 | 3/31/2009 | |||||||||||||||
Allowance for Loan Losses | ||||||||||||||||||||
Beginning balance | $ | 173,588 | 165,975 | 156,821 | 146,639 | 125,572 | ||||||||||||||
Charge-offs: | ||||||||||||||||||||
Residential real estate | (4,181 | ) | (7,579 | ) | (7,174 | ) | (3,923 | ) | (4,588 | ) | ||||||||||
Commercial real estate | (21,332 | ) | (58,664 | ) | (21,541 | ) | (10,530 | ) | (5,565 | ) | ||||||||||
Commercial business | — | — | — | (516 | ) | — | ||||||||||||||
Consumer | (10,771 | ) | (8,307 | ) | (12,490 | ) | (9,118 | ) | (10,321 | ) | ||||||||||
Small business | (837 | ) | (1,738 | ) | (2,249 | ) | (2,347 | ) | (2,771 | ) | ||||||||||
Total charge-offs | (37,121 | ) | (76,288 | ) | (43,454 | ) | (26,434 | ) | (23,245 | ) | ||||||||||
Recoveries: | ||||||||||||||||||||
Residential real estate | 64 | 96 | 133 | 360 | 323 | |||||||||||||||
Commercial real estate | 62 | 422 | — | — | 278 | |||||||||||||||
Commercial business | 658 | 494 | — | 5 | 1 | |||||||||||||||
Consumer | 194 | 205 | 157 | 130 | 95 | |||||||||||||||
Small business | 69 | 161 | 72 | 166 | 95 | |||||||||||||||
Total recoveries | 1,047 | 1,378 | 362 | 661 | 792 | |||||||||||||||
Net charge-offs | (36,074 | ) | (74,910 | ) | (43,092 | ) | (25,773 | ) | (22,453 | ) | ||||||||||
Provision for loan losses | 32,034 | 82,523 | 52,246 | 35,955 | 43,520 | |||||||||||||||
Ending balance | $ | 169,548 | 173,588 | 165,975 | 156,821 | 146,639 | ||||||||||||||
As of | ||||||||||||||||||||
3/31/2010 | 12/31/2009 | 9/30/2009 | 6/30/2009 | 3/31/2009 | ||||||||||||||||
Credit Quality | ||||||||||||||||||||
Nonaccrual loans | ||||||||||||||||||||
Commercial real estate | $ | 168,937 | 167,867 | 189,720 | 204,104 | 204,560 | ||||||||||||||
Consumer | 14,428 | 14,451 | 11,336 | 11,821 | 7,984 | |||||||||||||||
Small business | 10,971 | 9,338 | 9,693 | 8,916 | 7,383 | |||||||||||||||
Residential real estate | 88,262 | 76,401 | 76,022 | 64,720 | 45,630 | |||||||||||||||
Commercial business | 18,767 | 18,063 | 8,094 | 5,887 | 5,887 | |||||||||||||||
Total Nonaccrual loans | 301,365 | 286,120 | 294,865 | 295,448 | 271,444 | |||||||||||||||
Nonaccrual tax certificates | 1,495 | 2,161 | 3,011 | 3,091 | 1,298 | |||||||||||||||
Real estate owned | 40,833 | 35,935 | 30,796 | 30,213 | 21,763 | |||||||||||||||
Other repossessed assets | — | 10 | 13 | 23 | — | |||||||||||||||
Total nonperforming assets | $ | 343,693 | 324,226 | 328,685 | 328,775 | 294,505 | ||||||||||||||
Allowance for loan losses to total loans | % | 4.64 | 4.53 | 4.18 | 3.79 | 3.41 | ||||||||||||||
Allowance to nonaccrual loans | % | 56.26 | 60.67 | 56.29 | 53.08 | 54.02 | ||||||||||||||
Provision to average loans | % | 3.42 | 8.39 | 5.14 | 3.40 | 4.00 | ||||||||||||||
Annualized net charge-offs to average loans | % | 3.85 | 7.61 | 4.24 | 2.44 | 2.06 | ||||||||||||||
Nonperforming loans to total assets | % | 6.43 | 6.02 | 6.04 | 5.69 | 4.95 | ||||||||||||||
Nonperforming assets to total assets | % | 7.33 | 6.82 | 6.73 | 6.34 | 5.37 |
24
BankAtlantic (Bank Operations Business Segment)
Delinquencies, Excluding Non-Accrual Loans, at Period-End
Delinquencies, Excluding Non-Accrual Loans, at Period-End
($ in thousands) | 3/31/2010 | 12/31/2009 | 9/30/2009 | 6/30/2009 | 3/31/2009 | |||||||||||||||
Commercial real estate | $ | 40,642 | 25,489 | 12,500 | 8,592 | 29,115 | ||||||||||||||
Consumer | 14,858 | 15,173 | 13,678 | 9,914 | 12,396 | |||||||||||||||
Small business | 3,891 | 2,714 | 3,900 | 3,529 | 6,702 | |||||||||||||||
Residential real estate | 26,893 | 26,710 | 24,877 | 24,441 | 27,375 | |||||||||||||||
Commercial business | 1,129 | 2,820 | 4,863 | — | 195 | |||||||||||||||
Total BankAtlantic | $ | 87,413 | 72,906 | 59,818 | 46,476 | 75,783 | ||||||||||||||
3/31/2010 | 12/31/2009 | 9/30/2009 | 6/30/2009 | 3/31/2009 | ||||||||||||||||
Commercial real estate | % | 3.85 | * | 2.28 | * | 1.07 | * | 0.72 | * | 2.39 | * | |||||||||
Consumer | % | 2.23 | 2.23 | 1.97 | 1.40 | 1.71 | ||||||||||||||
Small business | % | 1.26 | 0.87 | 1.25 | 1.12 | 2.11 | ||||||||||||||
Residential real estate | % | 1.83 | ** | 1.72 | ** | 1.52 | ** | 1.39 | ** | 1.46 | ** | |||||||||
Commercial business | % | 0.84 | 1.80 | 3.27 | — | 0.13 | ||||||||||||||
Total BankAtlantic | % | 2.40 | 1.91 | * | 1.51 | 1.13 | * | 1.77 | * | |||||||||||
* | Excludes $0, $8.7 million, $0, $14.3 million and $15.7 million of Commercial Real Estate loans at March 31, 2010, December 31,2009, September 30, 2009, June 30, 2009 and March 31, 2009, respectively, which had matured and had been approved for renewal or forbearance but were not fully documented at period end. Including these loans, Commercial Real Estate delinquencies were 3.07%,1.90% and 3.68% and total BankAtlantic delinquencies would have been 2.14%, 1.50% and 2.14% at December 31, 2009, June 30, 2009 and March 31, 2009, respectively. | |
** | Includes $1.4 billion, $1.5 billion, $1.6 billion, $1.7 billion and $1.8 billion of purchased residential loans with delinquencies excluding non-accrual loans of 1.63%, 1.59%, 1.44%, 1.38%, 1.38% as of March 31, 2010, December 31, 2009, September 30, 2009, June 30, 2009 and March 31, 2009, respectively. |
BankAtlantic (Bank Operations Business Segment)
Loan Provision & Allowance for Loan Losses
Loan Provision & Allowance for Loan Losses
Allowance | % of Reserves | |||||||||||
1Q 2010 | for Loan | to Total | ||||||||||
($ in thousands) | Loan Provision | Losses | Loans | |||||||||
Commercial real estate | $ | 15,698 | 86,086 | 8.16 | % | |||||||
Consumer | 8,078 | 39,918 | 6.00 | |||||||||
Small business | (665 | ) | 6,565 | 2.12 | ||||||||
Residential real estate | 6,699 | 29,582 | 2.01 | |||||||||
Commercial business | 2,224 | 7,397 | 5.48 | |||||||||
Total BankAtlantic | $ | 32,034 | 169,548 | 4.64 | % | |||||||
25
BankAtlantic (Bank Operations Business Segment)
Reconciliation of GAAP Financial Measures to Non-GAAP Measures
Reconciliation of GAAP Financial Measures to Non-GAAP Measures
Management uses non-GAAP financial measures to supplement its GAAP financial information and to provide additional useful measures in the evaluation of BankAtlantic’s operating results and any related trends that may be affecting BankAtlantic’s business. Management uses pre-tax core operating earnings to measure BankAtlantic’s ongoing financial performance excluding items that are not currently controllable by management. Management uses core expenses to measure expense reduction trends excluding items that are not currently controllable by management. The core operating efficiency ratio is used by management to measure the costs expended to generate a dollar of revenues excluding items that are not currently controllable by management. The return on average tangible equity and average tangible assets is used by management to measure BankAtlantic’s effectiveness in its use of capital and assets, respectively, and to allow for comparison to other companies in the industry. The tangible equity to tangible asset ratio is used by management to evaluate capital adequacy trends and to allow for comparison to other companies in the industry. Management uses the core deposit measure to assess trends relating to its lower cost deposit categories, which management believes may generally be more indicative of relationship deposits. These disclosures should not be viewed as a substitute for operating results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies.
Reconciliation of loss from bank operations business segment before income taxes to pre-tax core operating earnings
For the Three Months Ended | ||||||||||||||||||||
(in thousands) | 3/31/2010 | 12/31/2009 | 9/30/2009 | 6/30/2009 | 3/31/2009 | |||||||||||||||
Loss from bank operations business segment before income taxes | $ | (17,039 | ) | (80,359 | ) | (35,301 | ) | (24,178 | ) | (40,589 | ) | |||||||||
Costs associated with debt redemption | 7 | — | 5,431 | 1,441 | 591 | |||||||||||||||
Provision for tax certificates | 733 | 686 | (198 | ) | 1,414 | 1,486 | ||||||||||||||
Impairment of goodwill | — | — | — | — | 9,124 | |||||||||||||||
Impairment, restructuring and exit activities | 143 | 7,700 | 1,730 | 1,817 | 2,086 | |||||||||||||||
FDIC special assessment | — | — | — | 2,428 | — | |||||||||||||||
Provision for loan losses | 32,034 | 82,523 | 52,246 | 35,955 | 43,520 | |||||||||||||||
Non-GAAP pre-tax core operating earnings | $ | 15,878 | 10,550 | 23,908 | 18,877 | 16,218 | ||||||||||||||
Reconciliation of non-interest expense to core expenses and calculation of core operating efficiency ratio
For the Three Months Ended | ||||||||||||||||||||
($ in thousands) | 3/31/2010 | 12/31/2009 | 9/30/2009 | 6/30/2009 | 3/31/2009 | |||||||||||||||
Non-interest expense | $ | 52,721 | 65,987 | 60,032 | 61,077 | 71,703 | ||||||||||||||
Costs associated with debt redemption | (7 | ) | — | (5,431 | ) | (1,441 | ) | (591 | ) | |||||||||||
Provision for tax certificates | (733 | ) | (686 | ) | 198 | (1,414 | ) | (1,486 | ) | |||||||||||
Impairment of goodwill | — | — | — | — | (9,124 | ) | ||||||||||||||
Impairment, restructuring and exit activities | (143 | ) | (7,700 | ) | (1,730 | ) | (1,817 | ) | (2,086 | ) | ||||||||||
FDIC special assessment | — | — | — | (2,428 | ) | — | ||||||||||||||
Core expenses | $ | 51,838 | 57,601 | 53,069 | 53,977 | 58,416 | ||||||||||||||
Net interest income | 38,975 | 39,992 | 41,485 | 40,078 | 41,769 | |||||||||||||||
Non-interest income | 28,741 | 28,159 | 35,492 | 32,776 | 32,865 | |||||||||||||||
Total revenues | $ | 67,716 | 68,151 | 76,977 | 72,854 | 74,634 | ||||||||||||||
Non-GAAP core operating efficiency ratio | 76.55 | % | 84.52 | % | 68.94 | % | 74.09 | % | 78.27 | % | ||||||||||
Reconciliation of return on average assets and average equity to return on average tangible assets and average tangible equity
For the Three Months Ended | ||||||||||||||||||||
($ in thousands) | 3/31/2010 | 12/31/2009 | 9/30/2009 | 6/30/2009 | 3/31/2009 | |||||||||||||||
Net loss from bank operations business segment | $ | (17,129 | ) | (48,637 | ) | (35,304 | ) | (24,178 | ) | (40,589 | ) | |||||||||
Average total assets | 4,684,506 | 4,835,545 | 4,975,297 | 5,270,902 | 5,674,239 | |||||||||||||||
Average goodwill and core deposit intangibles | (15,652 | ) | (15,973 | ) | (16,297 | ) | (16,618 | ) | (25,825 | ) | ||||||||||
Average tangible assets | 4,668,854 | 4,819,572 | 4,959,000 | 5,254,284 | 5,648,414 | |||||||||||||||
Average equity | 382,027 | 436,322 | 384,934 | 405,382 | 422,154 | |||||||||||||||
Average goodwill and core deposit intangibles | (15,652 | ) | (15,973 | ) | (16,297 | ) | (16,618 | ) | (25,825 | ) | ||||||||||
Other comprehensive loss | 845 | 4,995 | 7,369 | 2,640 | 5,336 | |||||||||||||||
Average tangible equity | $ | 367,220 | 425,344 | 376,006 | 391,404 | 401,665 | ||||||||||||||
Return on average assets from continuing operations | -1.46 | % | -4.02 | % | -2.84 | % | -1.83 | % | -2.86 | % | ||||||||||
Return on average tangible assets from continuing operations — Non-GAAP | -1.47 | % | -4.04 | % | -2.85 | % | -1.84 | % | -2.87 | % | ||||||||||
Return on average equity from continuing operations | -17.93 | % | -44.59 | % | -36.69 | % | -23.86 | % | -38.46 | % | ||||||||||
Return on average tangible equity from continuing operations — Non-GAAP | -18.66 | % | -45.74 | % | -37.56 | % | -24.71 | % | -40.42 | % | ||||||||||
Reconciliation of equity to total tangible capital; Total assets to total tangible assets; The calculation of tangible capital to tangible assets
For the Three Months Ended | ||||||||||||||||||||
($ in thousands) | 3/31/2010 | 12/31/2009 | 9/30/2009 | 6/30/2009 | 3/31/2009 | |||||||||||||||
Equity | $ | 368,182 | 378,901 | 423,242 | 383,370 | 405,088 | ||||||||||||||
Goodwill and core deposit intangibles | (15,494 | ) | (15,817 | ) | (16,139 | ) | (16,461 | ) | (16,784 | ) | ||||||||||
Total tangible capital | 352,688 | 363,084 | 407,103 | 366,909 | 388,304 | |||||||||||||||
Total assets | 4,688,001 | 4,755,122 | 4,882,385 | 5,189,711 | 5,488,603 | |||||||||||||||
Goodwill and core deposit intangibles | (15,494 | ) | (15,817 | ) | (16,139 | ) | (16,461 | ) | (16,784 | ) | ||||||||||
Total tangible assets | $ | 4,672,507 | $ | 4,739,305 | $ | 4,866,246 | $ | 5,173,250 | $ | 5,471,819 | ||||||||||
Non-GAAP tangible capital to tangible assets | 7.55 | % | 7.66 | % | 8.37 | % | 7.09 | % | 7.10 | % | ||||||||||
Reconciliation of total deposits to core deposits
For the Three Months Ended | ||||||||||||||||||||
(in thousands) | 3/31/2010 | 12/31/2009 | 9/30/2009 | 6/30/2009 | 3/31/2009 | |||||||||||||||
Total deposits | $ | 4,047,440 | 3,969,680 | 3,959,479 | 4,055,047 | 4,053,313 | ||||||||||||||
Money market | (361,877 | ) | (360,043 | ) | (372,442 | ) | (395,903 | ) | (413,777 | ) | ||||||||||
Certificates of deposit | (840,017 | ) | (960,559 | ) | (1,113,238 | ) | (1,230,829 | ) | (1,298,114 | ) | ||||||||||
Core deposits | 2,845,546 | 2,649,078 | 2,473,799 | 2,428,315 | 2,341,422 | |||||||||||||||
26
Parent Company Business Segment
Condensed Statements of Operations (unaudited)
Condensed Statements of Operations (unaudited)
For the Three Months Ended | ||||||||||||||||||||
(in thousands) | 3/31/2010 | 12/31/2009 | 9/30/2009 | 6/30/2009 | 3/31/2009 | |||||||||||||||
Net interest expense | $ | (3,485 | ) | (3,501 | ) | (3,633 | ) | (3,807 | ) | (4,021 | ) | |||||||||
(Recovery)/provision for loan losses | (1,279 | ) | (1,222 | ) | 11,340 | 7,539 | 757 | |||||||||||||
Net interest income after provision for loan losses | (2,206 | ) | (2,279 | ) | (14,973 | ) | (11,346 | ) | (4,778 | ) | ||||||||||
Non-interest income | ||||||||||||||||||||
Income from unconsolidated subsidiaries | 189 | 145 | 109 | 115 | 118 | |||||||||||||||
Securities activities, net | 6 | 1,274 | — | (1,375 | ) | 120 | ||||||||||||||
Other | 263 | 294 | 255 | 287 | 222 | |||||||||||||||
Non-interest income | 458 | 1,713 | 364 | (973 | ) | 460 | ||||||||||||||
Non-interest expense | ||||||||||||||||||||
Employee compensation and benefits | 1,004 | 2,399 | 959 | 950 | 728 | |||||||||||||||
Advertising and business promotion | 10 | 31 | 35 | 134 | 51 | |||||||||||||||
Professional fees | 322 | 596 | 718 | 359 | 382 | |||||||||||||||
Other | 308 | 235 | 464 | 416 | 543 | |||||||||||||||
Non-interest expense | 1,644 | 3,261 | 2,176 | 1,859 | 1,704 | |||||||||||||||
Loss from parent company activities before income taxes | (3,392 | ) | (3,827 | ) | (16,785 | ) | (14,178 | ) | (6,022 | ) | ||||||||||
Provision (benefit) for income taxes | — | — | — | — | — | |||||||||||||||
Net loss from parent company business segment | $ | (3,392 | ) | (3,827 | ) | (16,785 | ) | (14,178 | ) | (6,022 | ) | |||||||||
Parent Company Business Segment
Condensed Statements of Financial Condition — Unaudited
Condensed Statements of Financial Condition — Unaudited
As of | ||||||||||||||||||||
(in thousands) | 3/31/2010 | 12/31/2009 | 9/30/2009 | 6/30/2009 | 3/31/2009 | |||||||||||||||
ASSETS | ||||||||||||||||||||
Cash | $ | 5,135 | 14,002 | 16,105 | 16,122 | 19,860 | ||||||||||||||
Securities | 1,506 | 1,505 | 2,207 | 2,250 | 3,289 | |||||||||||||||
Investment in subsidiaries | 413,759 | 423,529 | 466,671 | 439,090 | 472,272 | |||||||||||||||
Investment in unconsolidated subsidiaries | 9,496 | 9,307 | 9,161 | 9,052 | 8,937 | |||||||||||||||
Other assets | 2,329 | 4,017 | 2,630 | 3,019 | 2,353 | |||||||||||||||
Total assets | $ | 432,225 | 452,360 | 496,774 | 469,533 | 506,711 | ||||||||||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||||||||||||||
Subordinated debentures and notes payable | $ | 311,707 | 308,334 | 304,944 | 301,353 | 297,519 | ||||||||||||||
Other liabilities | 1,288 | 2,455 | 2,388 | 1,613 | 2,177 | |||||||||||||||
Total liabilities | 312,995 | 310,789 | 307,332 | 302,966 | 299,696 | |||||||||||||||
Stockholders’ equity | 119,230 | 141,571 | 189,442 | 166,567 | 207,015 | |||||||||||||||
Total liabilities and stockholders’ equity | $ | 432,225 | 452,360 | 496,774 | 469,533 | 506,711 | ||||||||||||||
Parent Company Business Segment
Allowance for Loan Loss and Credit Quality
Allowance for Loan Loss and Credit Quality
Parent Company and Work-out Subsidiary | For the Three Months Ended | |||||||||||||||||||
(in thousands) | 3/31/2010 | 12/31/2009 | 9/30/2009 | 6/30/2009 | 3/31/2009 | |||||||||||||||
Allowance for Loan Losses | ||||||||||||||||||||
Beginning balance | $ | 13,630 | 18,688 | 15,399 | 11,758 | 11,685 | ||||||||||||||
Net charge-offs | (4,302 | ) | (3,836 | ) | (8,051 | ) | (3,898 | ) | (684 | ) | ||||||||||
Provision for loan losses | (1,279 | ) | (1,222 | ) | 11,340 | 7,539 | 757 | |||||||||||||
Ending balance | $ | 8,049 | 13,630 | 18,688 | 15,399 | 11,758 | ||||||||||||||
As of | ||||||||||||||||||||
3/31/2010 | 12/31/2009 | 9/30/2009 | 6/30/2009 | 3/31/2009 | ||||||||||||||||
Credit Quality | ||||||||||||||||||||
Total Loans — gross | $ | 38,363 | 48,012 | 56,783 | 67,910 | 76,641 | ||||||||||||||
Nonaccrual loans | $ | 35,326 | 44,897 | 53,520 | 64,558 | 74,321 | ||||||||||||||
Specific reserves | (8,049 | ) | (13,630 | ) | (18,680 | ) | (15,367 | ) | (11,758 | ) | ||||||||||
Nonaccrual loans, net | $ | 27,277 | 31,267 | 34,840 | 49,191 | 62,563 | ||||||||||||||
Real estate owned | 10,532 | 10,532 | 6,267 | 4,082 | — | |||||||||||||||
Total nonperforming assets | $ | 37,809 | 41,799 | 41,107 | 53,273 | 62,563 | ||||||||||||||
27