EXHIBIT 99.1
FOR IMMEDIATE RELEASE: April 21, 1999
CONTACT: Cathy Califano, S.V.P. /C.F.O., Haven Bancorp
tel. (516) 683-4483
HAVEN BANCORP REPORTS FIRST QUARTER RESULTS
Westbury, NY--Haven Bancorp, Inc. (Nasdaq: HAVN), the holding company
for CFS Bank, today reported net income of $2.6 million, or $0.30 per basic
common share ($0.29 per share, diluted) for the first quarter of 1999, compared
to $2.1 million, or $0.25 per basic common share ($0.24 per share, diluted)
earned in the first quarter of 1998.
Philip S. Messina, Chairman, President and Chief Executive Officer,
stated, " We are pleased that net income grew by 21% over the first quarter of
1998. The first quarter 1999 financial results met our expectations. Through the
initiatives that were completed in 1998, we are now offering our broadened
product mix through our expanded delivery platform. This approach allows us to
provide our traditional banking services, plus the products and services offered
by the Bank's mortgage banking division, investment services subsidiary and our
insurance agency subsidiary, combined with the conveniences and advantages of
supermarket banking."
"Real estate loans originated and purchased for our loan portfolio
totaled $166.2 million in the first quarter of 1999 compared to originations and
purchases of $94.5 million in the first quarter of 1998. We added another $160.6
million of residential loans originated for sale in the secondary market for a
total of $326.8 million of real estate loans originated and purchased during the
first quarter of 1999. Mortgage banking operations added $4.5 million to
non-interest income in the first quarter of 1999. Deposit account fees and
insurance, annuity and mutual fund fees rose sharply to $5.1 million, or 70.1%
in the first quarter of 1999 from $3.0 million in the first quarter of 1998."
615 Merrick Avenue
Westbury, NY 11590
"We have substantially completed the current investment phase of our
planned expansion program and now emphasize increasing earnings and maximizing
franchise value. We recently reorganized our residential lending division in
order to bring greater focus to sales, operations and secondary marketing. Gary
B. Johansen has been appointed Senior Vice President-Sales Manager, Ronald A.
Pasquini has been appointed Senior Vice President-Lending Operations Coordinator
and Janet Mangafas has joined the Bank as Vice President-Secondary Marketing
Manager. I am also pleased to announce that William J. Jennings II has joined
Haven and the Bank as Executive Vice President and Assistant to the President.
Mr. Jennings will continue as a Director of Haven and the Bank, positions he has
held since 1996. Prior to joining Haven, Mr. Jennings held various positions
with Salomon Brothers, Inc. and its successor Salomon Smith Barney, Inc.,
including the most recent position of Chief of Staff to the Chairman. I am
confident that the addition of Mr. Jennings to our management team along with
the other organizational and management changes we have made will help us to
ensure effective and timely execution of our plans. Based on our current stock
price, our stock is trading at a price to earnings multiple and a price to book
value ratio which we do not believe is reflective of our prospects."
Net interest income for the first quarter of 1999 was $16.2 million, a
20.1% increase over net interest income of $13.5 million in the first quarter of
1998. The increase was the result of interest-earning asset growth, particularly
mortgage loans. Average interest-earning assets increased by 20.7% in the first
quarter of 1999 compared to the first quarter of 1998, primarily due to a 21.1%
increase in average mortgage loans, as well as a 41.9% increase in average
mortgage-backed securities. The net interest margin in the 1999 first quarter
was 2.80% compared to the margin of 2.82% in the 1998 quarter.
The provision for loan losses in the first quarter of 1999 was $675,000
compared to $670,000 in first quarter of 1998. The allowance for loan losses was
$14.6 million, or 1.02% of loans at March 31, 1999 compared to $14.0 million, or
1.07% of loans at December 31, 1998.
Non-interest income increased to $11.1 million, or 148.1%, in the first
quarter of 1999 from $4.5 million in the first quarter of 1998. The growth in
non-interest income reflects the impact of the continued maturation of our
supermarket banking program and the addition of our mortgage banking and
insurance businesses. Non-interest income in the 1999 first quarter included
$4.5 million in servicing released premiums and fees related to loans sold in
the quarter. Deposit fees increased 72.6% in the 1999 first quarter to $3.1
million from $1.8 million in the 1998 first quarter. Insurance, annuity and
mutual funds fees for the first quarter of 1999 increased 66.4% to $2.0 million
from $1.2 million in the 1998 first quarter.
Non-interest expense increased by 59.2% to $22.4 million in the first
quarter of 1999 compared to $14.1 million for the 1998 first quarter. The
increase was due primarily to the the addition of the expenses of the loan
production franchise of CFS Intercounty and the Bank's expansion of its
supermarket banking program from thirty-nine branches at March 31, 1998 to
fifty-nine branches at March 31, 1999. Due primarily to increased headcount,
compensation and benefits expenses, which accounted for the majority of the
increase, rose by 59.1% in the 1999 first quarter compared to the prior year
period. Occupancy and equipment expenses increased by 50.7% to $3.3 million in
the 1999 first quarter compared to $2.2 million in the prior year period. Since
we have incurred the start-up costs of recruiting and training new personnel and
the occupancy costs associated with opening up substantially all of the new
branches, our non-interest expenses related to supermarket banking should
stabilize. In addition, the integration of the businesses of CFS Intercounty and
CFS Insurance Agency are substantially complete and we do not anticipate
significant organizational expenses related to these businesses.
-2-
Non-performing assets at March 31, 1999 totaled $10.3 million, or 0.40%
of total assets. Non-performing loans, comprising non-accrual and restructured
loans, were $10.1 million and real estate owned, net, was $0.2 million at March
31, 1999. Non-performing assets at March 31, 1998, totaled $11.4 million, or
0.57% of total assets; non-performing loans totaled $10.8 million and real
estate owned, net, equaled $0.6 million.
As of March 31, 1999, CFS Bank had fifty-nine supermarket branches with
total deposits of $ 578.1 million, an increase of $74.1 million, or 14.7% from
$504.0 million at December 31, 1998. Core deposits equaled 58.3% of total
supermarket branch deposits, compared to a ratio of 45.3% in traditional
branches. Core deposits for the supermarket branches included $209.3 million of
"Liquid Asset" account balances at March 31, 1999. This account was introduced
at the supermarket branches in the second quarter of 1998 and currently pays an
initial rate of 4.25% for balances over $2,500. The supermarket branches added
approximately 20,000 new core deposit accounts during the first quarter of 1999,
bringing the total number of core deposit accounts in the supermarket branches
to approximately 153,000. Non-interest income from supermarket branches totaled
$3.2 million in the first quarter of 1999, while non-interest expense directly
attributable to these branches totaled $6.0 million for the period. This
compares with non-interest income from supermarket branches of $1.4 million and
non-interest expenses directly attributable to the supermarket branches of $4.3
million for the first quarter of 1998.
At March 31, 1999, Haven Bancorp had total assets of $2.55 billion.
Stockholders' equity was $119.1 million, or $13.43 book value per share. CFS
Bank's tangible, core and risk-based capital ratios at March 31, 1999, were
5.20%, 5.20% and 11.24%, respectively. These ratios exceed the minimum
regulatory requirements of 2.00%, 4.00% and 8.00%, respectively. The Bank is
considered "well capitalized" by regulatory standards.
On April 13, 1999, Haven Bancorp, Inc. filed a registration statement
with the Securities and Exchange Commission to issue $35.0 million of capital
securities through Haven Capital Trust II. A registration statement relating to
these securities has been filed with the Securities and Exchange Commission but
has not yet become effective. These securities may not be sold nor may offers to
buy be accepted prior to the time the registration statement becomes effective.
This press release shall not constitute an offer to sell or the solicitation of
an offer to buy nor shall there be any sale of these securities in any State in
which such offer, solicitation or sale would be unlawful prior to registration
or qualification under the securities laws of any such State. When the
preliminary prospectus is completed, copies of this prospectus may be requested
from the Company at the address set forth above. The Company currently intends
to use the net proceeds from the sale of the capital securities to invest in the
Bank to increase its capital level. The increased capital will enable the Bank
to expand its deposit base. The Bank will also invest its new capital in
residential and commercial real estate loans in our market area and in
investment-grade mortgage-backed and investment securities.
-3-
Headquartered in Westbury, New York, Haven Bancorp, Inc. is the holding
company for CFS Bank, a community-oriented institution offering deposit
products, residential and commercial real estate loans and a full range of
financial services including discount brokerage, mutual funds, annuities and
insurance through eight full-service banking offices and fifty-nine supermarket
branches located in New York City, Nassau, Suffolk, Rockland and Westchester
counties, New Jersey and Connecticut. The Bank provides residential mortgage
banking services through its CFS Intercounty Mortgage division operating from
six loan origination offices and six satellite offices in New York, New Jersey,
Pennsylvania and Connecticut. The Company provides auto, homeowners and business
lines of insurance through its subsidiary, CFS Insurance Agency, Inc. The Bank's
deposits are insured by the FDIC.
STATEMENTS MADE HEREIN THAT ARE FORWARD-LOOKING IN NATURE WITHIN THE MEANING OF
THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995, AND ARE SUBJECT TO RISKS
AND UNCERTAINTIES THAT COULD CAUSE ACTUAL RESULTS TO DIFFER MATERIALLY. SUCH
RISKS AND UNCERTAINTIES INCLUDE, BUT ARE NOT LIMITED TO, THOSE RELATED TO
OVERALL BUSINESS CONDITIONS, PARTICULARLY IN THE CONSUMER FINANCIAL SERVICES,
MORTGAGE AND INSURANCE MARKETS IN WHICH HAVEN OPERATES, FISCAL AND MONETARY
POLICY, COMPETITIVE PRODUCTS AND PRICING, CREDIT RISK MANAGEMENT, CHANGES IN
REGULATIONS AFFECTING FINANCIAL INSTITUTIONS AND OTHER RISKS AND UNCERTAINTIES
DISCUSSED IN THE COMPANY'S SEC FILINGS, INCLUDING ITS 1998 FORM 10-K. THE
COMPANY DISCLAIMS ANY OBLIGATION TO PUBLICLY ANNOUNCE FUTURE EVENTS OR
DEVELOPMENTS, WHICH MAY AFFECT THE FORWARD-LOOKING STATEMENTS CONTAINED HEREIN.
SELECTED FINANCIAL RATIOS
-------------------------
THREE MONTHS ENDED
MARCH 31,
1999 1998
------------ ------------
(annualized)
Return on average assets 0.42% 0.43%
Return on average equity 8.67 7.52
Net interest spread 2.75 2.67
Net interest margin 2.80 2.82
Operating expenses to average assets (1) 3.61 2.78
(1) For the purpose of this calculation operating expenses equal non-interest
expense less amortization of goodwill, real estate operations, net and
non-performing loan expenses of $190,000 and $108,000 for the three-months ended
March 31, 1999, and 1998, respectively.
March 31, December 31,
1999 1998
--------------------- --------------------
Stockholders' equity to total assets 4.67% 5.00%
Stockholders' equity per share $13.43 $13.53
Non-performing loans to total loans 0.71% 0.64%
Non-performing assets to total assets 0.40 0.36
Allowance for loan losses to non-performing loans 144.37 166.70
Allowance for loan losses to total loans 1.02 1.07
more...
HAVEN BANCORP, INC.
CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except per share data)
For the Three Months Ended
March 31,
-----------------------------
1999 1998
--------- --------
INTEREST INCOME
- ---------------
Loans $ 25,735 $ 22,526
Mortgage-backed securities 12,650 8,931
Money market investments 30 104
Debt and equity securities 2,065 3,402
-------- --------
Total Interest Income 40,480 34,963
-------- --------
INTEREST EXPENSE
- ----------------
Deposits
Savings accounts 4,669 2,416
NOW accounts 324 261
Money market accounts 419 423
Certificate accounts 11,753 11,863
Borrowed funds 7,109 6,506
-------- --------
Total Interest Expense 24,274 21,469
-------- --------
Net interest income before provision for loan losses 16,206 13,494
Provision for loan losses 675 670
-------- --------
Net interest income after provision for loan losses 15,531 12,824
-------- --------
NON-INTEREST INCOME
- -------------------
Loan fees and servicing income 505 518
Servicing released premiums and fees on loans sold 4,531 --
Savings/checking fees 3,125 1,811
Net gain on sales of interest-earning assets 335 352
Insurance annuity and mutual fund fees 1,975 1,187
Other 590 591
-------- --------
Total Non-Interest Income 11,061 4,459
-------- --------
NON-INTEREST EXPENSE
- --------------------
Compensation and benefits 12,055 7,577
Occupancy and equipment 3,344 2,219
REO operations, net (151) 49
Federal deposit insurance premiums 254 207
Other 6,887 4,015
-------- --------
Total Non-Interest Expense 22,389 14,067
-------- --------
Income before income tax expense 4,203 3,216
Income tax expense 1,603 1,067
-------- --------
Net income $ 2,600 $ 2,149
======== ========
Net income per common share: Basic $ 0.30 $ 0.25
======== ========
Diluted $ 0.29 $ 0.24
======== ========
HAVEN BANCORP, INC.
Consolidated Statements of Financial Condition
(In thousands, except for share data)
March 31, December 31,
1999 1998
-------------------- -----------------------
ASSETS
Cash and due from banks $ 31,759 $ 43,088
Money market investments 1,421 1,720
Securities available for sale 941,027 889,251
Loans held for sale 59,440 54,188
Federal Home Loan Bank of NY Stock 22,255 21,990
Loans receivable:
First mortgage loans 1,384,483 1,271,784
Cooperative apartment loans 3,432 3,970
Other loans 36,211 34,926
-------------------- -----------------------
Total loans receivable 1,424,126 1,310,680
Less allowance for loan losses (14,573) (13,978)
-------------------- -----------------------
Loans receivable, net 1,409,553 1,296,702
Premises and equipment, net 37,772 39,209
Accrued interest receivable 13,586 12,108
Other assets 33,346 37,267
-------------------- -----------------------
Total Assets $ 2,550,159 $ 2,395,523
==================== =======================
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities
Deposits $ 1,804,795 $ 1,722,710
Borrowed funds 586,330 440,346
Due to broker 10,000 97,458
Other liabilities 29,904 15,142
-------------------- -----------------------
Total Liabilities 2,431,029 2,275,656
-------------------- -----------------------
Stockholders' Equity:
Preferred stock ($.01 par value, 2,000,000
shares authorized, none issued) - -
Common stock ($.01 par value, 30,000,000 shares
authorized, 9,918,750 issued; 8,867,814 and
8,859,692 outstanding at March 31, 1999 and
December 31, 1998, respectively) 100 100
Additional paid-in capital 51,580 51,383
Retained earnings, substantially restricted 81,020 79,085
Accumulated other comprehensive income:
Unrealized (loss) gain on securities available-
for-sale, net of tax effect (2,107) 945
Treasury stock, at cost (1,050,936 and 1,059,058 shares
at March 31, 1999 and December 31, 1998, respectively) (9,753) (9,800)
Unallocated common stock held by ESOP (1,149) (1,222)
Unearned common stock held by Bank's Recognition
Plans and Trusts (262) (263)
Unearned compensation (299) (361)
-------------------- -----------------------
Total Stockholders' Equity 119,130 119,867
==================== =======================
Total Liabilities and Stockholders' Equity $ 2,550,159 $ 2,395,523
==================== =======================
Book value per share $ 13.43 $ 13.53
==================== =======================
HAVEN BANCORP, INC.
Consolidated Average Balance Sheet - Yield/Rate Analysis
(Dollars in thousands)
For the
Three Months Ended
------------------
March 31, 1999 March 31, 1998
-------------- --------------
Average Yield/ Average Yield/
Balance Interest Rate(1) Balance Interest Rate(1)
------- -------- ------- ------- -------- -------
ASSETS
- ------
Interest-earning assets
Mortgage loans $ 1,377,235 $ 24,885 7.23% $ 1,136,919 $ 21,739 7.65%
Other loans 37,178 850 9.15 32,833 787 9.59
Mortgage-backed securities 762,234 12,650 6.64 537,116 8,931 6.65
Money market investments 1,516 30 7.92 8,175 104 5.09
Debt and equity securities 133,067 2,065 6.21 200,415 3,402 6.79
----------- -------- ---- -----------
Total interest-earning assets 2,311,230 40,480 7.01 1,915,458 34,963 7.30
Non-interest-earning assets 147,604 93,488
----------- -----------
Total assets $2,458,834 $ 2,008,946
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
Interest-bearing liabilities
Savings accounts $ 576,044 $ 4,669 3.24 $ 384,701 $ 2,416 2.51
Certificate accounts 892,050 11,753 5.27 824,774 11,863 5.75
NOW accounts 222,499 324 0.58 159,088 261 0.66
Money market accounts 57,986 419 2.89 55,260 423 3.06
Borrowed funds 530,099 7,109 5.36 432,750 6,506 6.01
----------- -------- ----------- --------
Total interest-bearing liabilities 2,278,678 24,274 4.26 1,856,573 21,469 4.63
-------- --------
Other liabilities 60,133 38,074
----------- -----------
Total liabilities 2,338,811 1,894,647
Stockholders' equity 120,023 114,299
----------- -----------
Total liabilities and
stockholders' equity $ 2,458,834 $ 2,008,946
=========== ===========
Net interest income $ 16,206 $13,494
======== =======
Net interest spread 2.75% 2.67%
==== ====
Net interest margin 2.80% 2.82%
==== ====
(1) annualized
HAVEN BANCORP, INC.
CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except per share data)
1999 1998
------------ ---------------------------------------------------------
1Q 4Q 3Q 2Q 1Q
------------ ---------------------------------------------------------
INTEREST INCOME
Loans $ 25,735 $ 26,389 $ 26,120 $ 24,414 $ 22,526
Mortgage-backed securities 12,650 11,926 11,610 9,573 8,931
Money market investments 30 17 23 42 104
Debt and equity securities 2,065 1,679 2,226 2,703 3,402
------------ ------------- ------------ ------------- -------------
Total Interest Income 40,480 40,011 39,979 36,732 34,963
------------ ------------- ------------ ------------- -------------
INTEREST EXPENSE
Deposits
Savings accounts 4,669 3,933 3,366 2,700 2,416
NOW accounts 324 418 344 341 261
Money market accounts 419 579 525 514 423
Certificate accounts 11,753 12,696 12,791 12,615 11,863
Borrowed funds 7,109 7,058 8,015 6,412 6,506
------------ ------------- ------------ ------------- -------------
Total Interest Expense 24,274 24,684 25,041 22,582 21,469
------------ ------------- ------------ ------------- -------------
Net interest income before provision for loan losses 16,206 15,327 14,938 14,150 13,494
Provision for loan losses 675 675 670 650 670
------------ ------------- ------------ ------------- -------------
Net interest income after provision for loan losses 15,531 14,652 14,268 13,500 12,824
------------ ------------- ------------ ------------- -------------
NON-INTEREST INCOME
Loan fees and servicing income 505 355 428 326 518
Servicing released premiums and fees on loans sold 4,531 4,748 4,646 907 -
Savings/checking fees 3,125 3,042 2,650 2,319 1,811
Net gain on sales of interest-earning assets 335 1,335 1,185 54 352
Insurance, annuity and mutual fund fees 1,975 1,901 1,472 1,314 1,187
Other 590 708 634 663 591
------------ ------------- ------------ ------------- -------------
Total Non-Interest Income 11,061 12,089 11,015 5,583 4,459
------------ ------------- ------------ ------------- -------------
NON-INTEREST EXPENSE
Compensation and benefits 12,055 11,156 12,084 10,387 7,577
Occupancy and equipment 3,344 3,458 2,947 2,381 2,219
REO operations, net (151) (20) 67 (88) 49
Federal deposit insurance premiums 254 210 231 222 207
Other 6,887 8,421 7,312 4,479 4,015
------------ ------------- ------------ ------------- -------------
Total Non-Interest Expense 22,389 23,225 22,641 17,381 14,067
------------ ------------- ------------ ------------- -------------
Income before income tax expense 4,203 3,516 2,642 1,702 3,216
Income tax expense 1,603 986 402 471 1,067
------------ ------------- ------------ ------------- -------------
Net income $ 2,600 $ 2,530 $ 2,240 $ 1,231 $ 2,149
============ ============= ============ ============= =============
Net income per common share:
Basic $ 0.30 $ 0.29 $ 0.26 $ 0.14 $ 0.25
============ ============= ============ ============= =============
Diluted $ 0.29 $ 0.28 $ 0.24 $ 0.13 $ 0.24
============ ============= ============ ============= =============