EXHIBIT 99.1
RELIANCE BANCORP, INC.
585 STEWART AVENUE (516) 222-9300
GARDEN CITY, NY 11530 FAX: (516) 222-4559
NEWS RELEASE
FOR IMMEDIATE RELEASE: October 21, 1999
For Information Contact:
Paul D. Hagan
Senior Vice President and CFO
(516) 222-9308 extension 215
RELIANCE BANCORP, INC. REPORTS FIRST QUARTER
FISCAL YEAR 2000 RESULTS
Garden City, New York, October 21, 1999
Reliance Bancorp, Inc. (NASDAQ/NMS:RELY), the holding company for Reliance
Federal Savings Bank, today reported net income of $5.4 million for the quarter
ended September 30, 1999, an increase of $611,000 or 12.8%, from $4.8 million
for the prior year quarter ended September 30, 1998. On a diluted earnings per
share basis, earnings rose 24.0% to $0.62 for the quarter ended September 30,
1999 from $0.50 for the prior year quarter ended September 30, 1998. Return on
average tangible equity increased 13.4% to 16.67% for the quarter ended
September 30, 1999 from 14.70% for the quarter ended September 30, 1998.
Cash earnings for the quarter ended September 30, 1999 were $7.1 million, an
increase of $473,000, or 7.1%, from $6.6 million recorded in the prior year
quarter. On a diluted cash earnings per share basis, earnings rose 17.1% to
$0.82 per diluted cash earnings per share from $0.70 recorded in the prior year
quarter. The Company's cash earnings are determined by adding back to reported
earnings the non-cash expenses related to the allocation of ESOP ("Employee
Stock Ownership Plan") stock and the earned portion of RRP ("Recognition and
Retention Plan") stock, net of associated tax benefits, and amortization of
excess of cost over fair value of net assets acquired ("goodwill").
As of September 30, 1999, total assets were $2.5 billion, deposits were $1.6
billion and total stockholders' equity was $171.7 million. At September 30,
1999, the Company had 8,589,490 common shares outstanding with a tangible book
value per common share of $13.79.
On September 22, 1999, the Board of Directors declared a regular cash dividend
of $0.21 per common share for the quarter ending September 30, 1999. The
dividend was paid on October 15, 1999 to stockholders of record on October 1,
1999.
On August 30, 1999, the Company and North Fork Bancorporation Inc. jointly
announced that they have signed a definitive merger agreement whereby North Fork
Bancorporation, Inc. would acquire Reliance Bancorp, Inc. in a stock-for-stock
merger valued at approximately $352 million. Each share of Reliance will be
converted into a fixed exchange ratio of 2 shares of North Fork common stock.
Page 1 of 7
Quarterly Results
Net income was $5.4 million for the quarter ended September 30, 1999, which
represents an annualized return on average assets and average tangible equity of
0.87% and 16.67%, respectively. Net interest income increased to $17.4 million
for the quarter ended September 30, 1999, an increase of $246,000, or 1.4%, from
$17.2 million for the quarter ended September 30, 1998. The higher net interest
income is due to an increase in the net interest spread from 2.62% to 2.70% and
the net interest margin from 2.92% to 2.97%, respectively, for the quarters
ended September 30, 1998 and 1999. For the quarter ended September 30, 1999, the
yield on interest-earning assets was 7.03% and the cost of interest-bearing
liabilities was 4.33% as compared to 7.28% and 4.66%, respectively, for the
quarter ended September 30, 1998.
Non-interest income increased $567,000, or 30.3%, to $2.4 million in the quarter
ended September 30, 1999 from $1.9 million in the prior year quarter. The
increase is mainly the result of additional fee income from annuity sales, ATM
transactions, money center fees, loan servicing fees and loan prepayment
penalties.
Non-performing assets
Non-performing loans totaled $7.6 million, or 0.75% of total loans at September
30, 1999 as compared to $6.6 million, or 0.67% of total loans, at June 30, 1999.
Non-performing loans at September 30, 1999 were comprised of $3.7 million of
loans secured by one- to four-family residences, $2.8 million of commercial real
estate loans, $815,000 of commercial loans and $254,000 of guaranteed student
and other loans.
For the quarter ended September 30, 1999, the Company had no provision for loan
losses. The Company's allowance for loan losses totalled $9.1 million at
September 30, 1999 which represents a ratio of allowance for loan losses to
non-performing loans and to total loans of 119.42% and 0.90% at September 30,
1999 compared to 139.08% and 0.93% at June 30, 1999, respectively. Management
believes the allowance for loan losses at June 30, 1999 is adequate and
sufficient reserves are presently maintained to cover losses on non-performing
loans. Net charge-offs were $52,000 for the quarter ended September 30, 1999.
Reliance Bancorp, Inc. and Reliance Federal Savings Bank are headquartered in
Garden City, New York. Reliance Federal is a community bank specializing in
providing deposit and credit services for its consumer and commercial customers.
Reliance Federal Savings Bank serves its customers from 29 banking offices
located in the New York counties of Queens, Nassau and Suffolk. Additional
information on the Company and Bank can be found on our Internet web site at
www.reliance-federal.com.
This release may contain certain forward-looking statements and may be
identified by the use of such words as "believe," "expect," "anticipate,"
"should," "planned," "estimated," and "potential." Examples of forward looking
statements include, but are not limited to, estimates with respect to the
financial condition, results of operations and business of the Company that are
subject to various factors which could cause actual results to differ materially
from these estimates. These factors include, but are not limited to, general
economic conditions, changes in interest rates, deposit flows, loan demand, real
estate values, and competition; changes in accounting principles, policies, or
guidelines; changes in legislation or regulation; and other economic,
competitive, governmental, regulatory, and technological factors affecting the
Company's operations, pricing, products, and services.
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RELIANCE BANCORP, INC. and SUBSIDIARY
Consolidated Statements of Condition
(Unaudited)
(Dollars in thousands, except share and per share data)
September 30, June 30,
1999 1999
---- ----
Assets
Cash and due from banks........................................................... $ 29,623 $ 33,255
Debt and equity securities available-for-sale..................................... 123,877 122,168
Debt and equity securities held-to-maturity (with estimated
market values of $48,702 and $28,840, respectively)............................ 48,835 28,835
Mortgage-backed securities available-for-sale..................................... 889,004 935,038
Mortgage-backed securities held-to-maturity (with estimated
market values of $256,806 and $252,233, respectively).......................... 260,844 255,917
Loans receivable:
Mortgage loans............................................................... 824,835 810,894
Commercial loans............................................................. 50,540 44,949
Consumer and other loans..................................................... 132,219 127,350
Less allowance for loan losses............................................. (9,068) (9,120)
-------- --------
Loans receivable, net................................................ 998,526 974,073
Accrued interest receivable, net.................................................. 14,148 13,095
Office properties and equipment, net.............................................. 17,779 16,368
Prepaid expenses and other assets................................................. 41,135 16,960
Mortgage servicing rights......................................................... 1,389 1,514
Excess of cost over fair value of net assets acquired............................. 53,232 54,373
Real estate owned, net............................................................ 507 177
------ -------
Total assets......................................................... $ 2,478,899 $ 2,451,773
========= =========
Liabilities and Stockholders' Equity
Deposits.......................................................................... $ 1,555,159 $ 1,549,419
Borrowed Funds.................................................................... 711,989 702,434
Advance payments by borrowers for taxes and insurance............................. 12,693 6,399
Accrued expenses and other liabilities............................................ 27,356 21,854
-------- --------
Total liabilities.................................................... 2,307,197 2,280,106
--------- ---------
Commitments Stockholders' Equity
Preferred Stock, $.01 par value, 4,000,000 shares
authorized; none issued......................................................... -- --
Common stock, $.01 par value, 20,000,000 shares
authorized; 10,750,820 shares issued; 8,589,490 and 8,586,210
outstanding, respectively..................................................... 108 108
Additional paid-in capital........................................................ 121,309 121,037
Retained earnings, substantially restricted....................................... 119,607 115,976
Accumulated other comprehensive income:
Net unrealized depreciation on securities
available-for-sale, net of taxes.............................................. (14,654) (10,546)
Less:
Unallocated common stock held by ESOP............................................. (3,519) (3,726)
Unearned common stock held by RRP................................................. (23) (66)
Common stock held by SERP (at cost)............................................... (551) (550)
Treasury stock, at cost (2,161,330 and 2,164,610 shares, respectively)............ (50,575) (50,566)
-------- --------
Total stockholders' equity................................................... 171,702 171,667
------- -------
Total liabilities and stockholders' equity............................ $ 2,478,899 $ 2,451,773
========= =========
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RELIANCE BANCORP, INC. and SUBSIDIARY
Consolidated Statements of Income
(Unaudited)
(In thousands, except per share data)
Three Months Ended
September 30,
------------------
1999 1998
---- ----
Interest income:
First mortgage loans........................................................... $ 15,814 $ 15,718
Commercial loans............................................................... 1,123 1,392
Consumer and other loans....................................................... 2,644 2,925
Mortgage-backed securities..................................................... 18,803 19,724
Money market investments....................................................... 35 163
Debt and equity securities..................................................... 2,903 2,946
------ -------
Total interest income....................................................... 41,322 42,868
------ ------
Interest expense:
Deposits....................................................................... 13,880 16,635
Borrowed funds................................................................. 9,993 9,030
------ ------
Total interest expense...................................................... 23,873 25,665
------ ------
Net interest income before provision for loan losses........................ 17,449 17,203
Provision for loan losses...................................................... -- 150
------ ------
Net interest income after provision for loan losses......................... 17,449 17,053
------ ------
Non-interest income:
Loan fees and service charges.................................................. 443 160
Other operating income......................................................... 1,272 1,013
Income from Money Centers...................................................... 723 632
Net gain on securities......................................................... -- 66
----- -----
Total non-interest income................................................... 2,438 1,871
----- -----
Non-interest expense:
Compensation and benefits...................................................... 5,267 5,286
Occupancy and equipment........................................................ 1,697 1,775
Federal deposit insurance premiums............................................. 230 228
Advertising.................................................................... 217 268
Other operating expenses....................................................... 1,868 1,570
------ ------
Total general and administrative expenses................................... 9,279 9,127
Real estate operations, net.................................................... 55 87
Amortization of excess of cost over fair value of net assets acquired.......... 1,141 1,140
------ ------
Total non-interest expense..................................................... 10,475 10,354
------ ------
Income before income taxes........................................................ 9,412 8,570
Income tax expense ............................................................... 4,030 3,799
------ -----
Net income........................................................................ $ 5,382 $ 4,771
===== =====
Net income per common share:
Basic............................................................ $ 0.65 $ 0.53
==== ====
Diluted.......................................................... $ 0.62 $ 0.50
==== ====
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RELIANCE BANCORP, INC. and SUBSIDIARY
Selected Financial Ratios
(Unaudited)
At or for the
Three Months Ended
September 30,
--------------------
1999 1998
---- ----
Performance ratios:
Return on average assets.......................................................... 0.87% 0.77%
Cash return on average assets..................................................... 1.15% 1.07%
Return on average equity (2)...................................................... 11.76% 10.13%
Cash return on average equity (2)................................................. 15.54% 14.10%
Return on average tangible equity (2)............................................. 16.67% 14.70%
Average equity to average assets................................................. 6.81% 7.74%
Equity to total assets............................................................ 6.93% 7.44%
Tangible equity to tangible assets................................................ 4.88% 5.25%
Core deposits to total deposits................................................... 39.42% 35.89%
Net interest spread............................................................... 2.70% 2.62%
Net interest margin............................................................... 2.97% 2.92%
General and administrative expenses to average assets............................. 1.50% 1.47%
Cash general and administrative expenses to average assets........................ 1.39% 1.32%
Operating income to average assets (1)............................................ 0.39% 0.29%
Average interest-earning assets to average interest-bearing liabilities........... 1.07X 1.07X
Cash net income per diluted common share.......................................... $0.82 $0.70
At At
September 30, June 30,
1999 1999
---- ----
Assets quality ratios:
Non-performing loans to total loans............................................... 0.75% 0.67%
Non-performing loans to total assets.............................................. 0.31% 0.27%
Non-performing assets to total assets............................................. 0.33% 0.27%
Allowance for loan losses to total loans.......................................... 0.90% 0.93%
Allowance for loan losses to non-performing loans................................. 119.42% 139.08%
(1) Operating income represents non-interest income less (plus) net gain (loss)
on securities.
(2) For purposes of these calculations, average equity and average tangible
equity exclude the effect of changes in the net unrealized appreciation
(depreciation) on securities available for sale, net of taxes.
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