EXHIBIT 99
WEBSTER MEDIA CONTACT: INVESTOR RELATIONS CONTACT:
Clark Finley, 203-578-2429 Terry Mangan, 203-578-2318
cfinley@websterbank.com tmangan@websterbank.com
WEBSTER REPORTS PER SHARE NET INCOME GROWTH IN FIRST QUARTER
WATERBURY, Conn., April 15, 2003 - Webster Financial Corporation (NYSE: WBS),
the holding company for Webster Bank, today reported a 32 percent increase in
net income per diluted share for the first quarter of 2003, compared to the
year-ago period. For the quarter ended March 31, 2003, Webster's net income
increased to $39.9 million or $.86 per diluted share, compared to $32.3 million
or $.65 per diluted share for the year-ago period.
Net income per diluted share, excluding the cumulative effect of a change in
accounting method in the 2002 first quarter, increased 8 percent for the quarter
ended March 31, 2003, compared to the same period last year. Included in net
income for the 2002 first quarter was a transitional goodwill impairment
writedown of $7.3 million, net of taxes, related to the cumulative effect of a
change in method of accounting for the implementation of SFAS No. 142. In the
first quarter of 2002, net income before the transitional goodwill impairment
writedown was $39.6 million.
"Webster's solid performance in the first quarter reflects our success in
implementing our strategic plan for growth," stated Webster chairman and chief
executive officer, James C. Smith. "Webster has strengthened its position as a
leading regional financial services provider offering a broad range of useful
products and services to our growing customer base. Growth in our balance sheet,
revenues and earnings over the past year demonstrate that Webster is creating
shareholder value by meeting the financial needs of its customers."
Revenues and Expenses
---------------------
Webster's continued improvement in earnings per share has been led by strong
revenue growth. Total revenues, consisting of net interest income and total
noninterest income, grew by 14 percent compared to the year-ago period. The
growth was due primarily to expansion of noninterest income, growth in loans and
an increase in core deposits over the past year.
For the first quarter of 2003, net interest income rose 8 percent to $104.7
million from $96.5 million a year ago and increased slightly from $104.1 million
in the fourth quarter. Net interest margin (annualized net interest income as a
percentage of average earning assets) was 3.30 percent in the first quarter of
2003, compared to 3.51 percent in the year ago period and 3.39 percent in the
<page>
fourth quarter. Earning asset growth over the past year, particularly in the
loan portfolio, was responsible for both increasing net interest income and
helping to offset the compression of net interest margin caused by the lower
interest rate environment.
For the first quarter of 2003, total noninterest income increased 28 percent to
$53.1 million, up from $41.5 million in the year-ago period. This increase is
due primarily to growth in deposit service fees, insurance revenue, loan and
loan servicing fees and net gain on sale of loans and loan servicing, all of
which amounted to $36.5 million and increased by 43 percent from the year-ago
period. Acquisitions over the past year accounted for almost one-half of the 43
percent increase. For the first quarter of 2003, total noninterest income
represented 34 percent of total revenue, compared to 30 percent in the year-ago
period.
Total noninterest expenses for the 2003 first quarter increased to $92.8
million, up 22 percent from $76.2 million one year ago and an increase of 4
percent from $89.2 million in the fourth quarter. The rise in total noninterest
expenses over the prior year's period is due to acquisitions and strategic
investments in core businesses. The $3.7 million increase in total noninterest
expenses from the fourth quarter is due primarily to acquisitions in the first
quarter of 2003.
Balance Sheet Growth
--------------------
At March 31, 2003, total assets increased to $14.4 billion, up 16 percent from
$12.3 billion one year ago and an increase of 7 percent from $13.5 billion at
the end of 2002. Total loans of $8.5 billion at March 31, 2003 increased 19
percent from a year ago and 8 percent from year-end. Webster's loan growth is
primarily attributed to the Whitehall asset-based lending acquisition in August
of 2002 and to growth in the home equity portfolio.
"Webster has taken another step in our transformation to the commercial bank
model," stated William T. Bromage, Webster president and chief operating
officer. "Our efforts to increase our commercial and consumer loans and our mix
of lower-cost core deposits gained significant momentum in 2002. Webster has
maintained that course in the first quarter, further diversifying our mix and
expanding our fee-income businesses."
At the end of the first quarter, commercial loans, including commercial real
estate, were $3.0 billion, up from $2.3 billion one year ago and $2.8 billion at
December 31, 2002. Consumer loans totaled $1.8 billion at the end of the first
quarter, compared to $1.2 billion one year ago and $1.7 billion at year end.
Commercial loans and consumer loans were 57 percent of total loans at March 31,
2003, compared to 50 percent of total loans one year ago.
Webster's residential mortgage business generated $974 million in mortgage
originations in the first quarter, compared to $449 million a year ago. In the
first quarter of 2003, 72 percent of this amount came from national wholesale
mortgage banking operations, while 28 percent came from Webster's retail
channel.
Total deposits were $7.8 billion at March 31, 2003, an increase of 9 percent
from $7.2 billion in the year-ago period and an increase of 2 percent from $7.6
billion at December 31, 2002. Core deposits at March 31, 2003 represented 66
percent of total deposits, up from 59 percent a year ago. Webster's growth was
driven in part by its High Performance Checking campaign initiated in August of
2002 and the continuing success of its de novo branch expansion program in
Fairfield County, Connecticut.
<page>
Book value per common share of $23.47 at March 31, 2003 increased by 14 percent
from $20.55 one year ago and increased by 3 percent from $22.69 at December 31,
2002.
Asset Quality
-------------
Webster's net loan charge-offs in the first quarter of 2003 were $3.4 million,
compared to $2.4 million in the year-ago period. The annualized charge-off ratio
was 16 basis points in the 2003 first quarter, compared to 14 basis points in
the year-ago period. Non-performing assets rose to $61.9 million or 0.43 percent
of total assets at March 31, 2003, compared to $54.3 million or 0.44 percent a
year ago and $50.0 million or 0.37 percent of total assets at December 31, 2002.
Classified loans were 1.5 percent of total loans at March 31, 2003 compared to
2.0 percent one year ago and 1.4 percent at December 31, 2002.
"Webster's credit quality measures remain well within recent historical levels
and our allowance for loan losses has increased by 20 percent over the past
year," stated William J. Healy, Webster chief financial officer. "Our ability to
confront credit issues while maintaining overall measures of asset quality
demonstrates our disciplined approach to risk management."
The allowance for loan losses totaled $118.6 million at March 31, 2003 compared
to $98.9 million a year ago and $116.8 million at December 31, 2002. The
allowance represented 1.39 percent of total loans at March 31, 2003 compared to
1.39 percent a year ago and 1.48 percent at December 31, 2002. The ratio of the
allowance to nonperforming loans at March 31, 2003 was 219 percent, compared to
197 percent a year ago and 270 percent at December 31, 2002.
Strategic Actions
-----------------
In January, Webster announced the acquisition of The Mathog & Moniello
Companies, an East Haven, Connecticut-based commercial property and casualty
agency that specializes in providing risk management products and services to
self-insured businesses and groups. The firm was one of the largest independent
insurance agencies in Connecticut with approximately 90 employees and additional
offices in West Hartford, CT and Harrison, New York. Mathog & Moniello's 2002
revenue was approximately $11 million.
Webster Bank also completed in January an offering of $200 million in
subordinated notes to institutional investors. The subordinated notes were rated
investment grade and constituted new funding that increased Webster Bank's
regulatory capital.
Also in the first quarter of 2003, Webster Bank announced the acquisition of
Budget Installment Corp., an insurance premium financing company based in
Rockville Centre, New York. Budget Installment Corp. finances commercial
property and casualty premiums for businesses that pay their premiums on an
installment basis. The thirty year-old company currently has approximately 8,000
active borrower accounts located in New York and New Jersey.
In January, Webster declared a regular quarterly dividend of $.19 per common
share. The announcement marked the 61st consecutive quarterly dividend since
Webster first paid a dividend in 1987.
Gomez, Inc., the nation's leading Internet channel benchmarking and improvement
strategies firm, announced in April that Webster Bank's website
(www.websteronline.com) ranks eighteenth in a national survey of Internet
banking capabilities. The survey measured the functionality, usability and
<page>
performance dimensions of Internet banking across the United States. Gomez
specifically cited Webster's self-service capabilities, 12-month statement
offerings and secure bill-pay system as factors in its recognition.
* * *
Webster Financial Corporation is the holding company for Webster Bank and
Webster Insurance. With $14 billion in assets, Webster Bank provides business
and consumer banking, mortgage, insurance, trust and investment services through
110 banking offices, 219 ATMs, a Connecticut-based call center and the Internet.
Webster Financial Corporation is majority owner of Chicago-based Duff & Phelps,
LLC, a leader in financial advisory services. Webster Bank owns the asset-based
lending firm, Whitehall Business Credit Corporation, Budget Installment Corp.,
Center Capital Corporation, an equipment finance company headquartered in
Farmington, Connecticut and Webster Trust Company, N.A.
For more information about Webster, including past press releases and the latest
Annual Report, visit the Webster website at www.websteronline.com.
Conference Call
- ---------------
A conference call covering today's announcement will be held today, Tuesday,
April 15, at 2:00 p.m. Eastern Standard Time and may be heard through Webster's
investor relations website at www.websteronline.com, or in listen-only mode by
calling 1-800-491-4331 (Access Code: 3330070). The call will be archived on the
website and available for future retrieval.
Statements in this press release regarding Webster Financial Corporation's
business that are not historical facts are "forward-looking statements" that
involve risks and uncertainties. For a discussion of such risks and
uncertainties that could cause actual results to differ from those contained in
the forward-looking statement, see "Forward Looking Statements" in Webster's
Annual Report for 2002.
<page>
WEBSTER FINANCIAL CORPORATION
- --------------------------------------------------------------------------------
SELECTED FINANCIAL HIGHLIGHTS (UNAUDITED)
- --------------------------------------------------------------------------------
At or for the Three
Months Ended March 31,
(In thousands, except per share data) 2003 2002 (a)
- --------------------------------------------------------------------------------
NET INCOME AND PERFORMANCE RATIOS (ANNUALIZED):
- ----------------------------------------------------
Net income $ 39,937 $ 32,335
Net income per diluted common share 0.86 0.65
Return on average shareholders' equity 15.21% 12.79%
Return on average assets 1.16 1.09
NET INCOME AND PERFORMANCE RATIOS BEFORE CUMULATIVE
EFFECT OF CHANGE IN ACCOUNTING METHOD (ANNUALIZED):
- ----------------------------------------------------
Net income $ 39,937 $ 32,335
Cumulative effect of change in accounting method (b) -- 7,280
-------- --------
Net income before cumulative effect of change in
accounting method 39,937 39,615
Net income per diluted common share 0.86 0.80
Return on average shareholders' equity 15.21% 15.66%
Return on average assets 1.16 1.33
Noninterest income as a percentage of total revenue 33.68 30.07
Efficiency ratio (e) 58.80 55.23
CASH INCOME AND PERFORMANCE RATIOS (ANNUALIZED) (C):
- ----------------------------------------------------
Net income $ 39,937 $ 32,335
Cumulative effect of change in accounting method (b) -- 7,280
Tax-effected intangible amortization 2,575 2,625
-------- --------
Cash income 42,512 42,240
Cash income per diluted common share 0.92 0.85
Cash return on average shareholders' equity 16.19% 16.70%
Cash return on average assets 1.24 1.42
ASSET QUALITY:
- ----------------------------------------------------
Allowance for loan losses $118,596 $ 98,930
Nonperforming assets 61,921 54,325
Allowance for loan losses / total loans 1.39% 1.39%
Net charge-offs/ average loans (annualized) 0.16 0.14
Nonperforming loans / total loans 0.64 0.70
Nonperforming assets / total assets 0.43 0.44
Allowance for loan losses / nonperforming loans 218.51 196.68
OTHER RATIOS (ANNUALIZED):
- ----------------------------------------------------
Shareholders' equity / total assets 7.46% 8.14%
Interest-rate spread 3.26 3.42
Net interest margin 3.30 3.51
SHARE RELATED:
- ----------------------------------------------------
Book value per common share $ 23.47 $ 20.55
Tangible book value per common share 16.92 14.67
Common stock closing price 35.12 37.43
Dividends declared per common share 0.19 0.17
Common shares issued and outstanding 45,617 48,879
Basic shares (average) 45,461 48,803
Diluted shares (average) 46,192 49,583
Footnotes:
(a) Adjusted to reflect the adoption of SFAS No. 123, "Accounting for
Stock-Based Compensation", SFAS No. 142, "Goodwill and Other Intangible
Assets", and SFAS No.147, "Acquisitions of Certain Financial Institutions"
during 2002.
(b) Cumulative effect of change in accounting method for 2002 is a SFAS No.
142 transitional goodwill impairment charge of $11.2 million, net of
taxes, $7.3 million.
(c) Net income excluding tax-effected intangible amortization of $2.6 million
and cumulative effect of change in accounting method of $7.3 million.
(d) For purposes of this computation, unrealized gains(losses) are excluded
from the average balance for rate calculations.
(e) Noninterest expense as a percentage of net interest income plus
noninterest income.
WEBSTER FINANCIAL CORPORATION
- --------------------------------------------------------------------------------
CONSOLIDATED STATEMENTS OF CONDITION (UNAUDITED)
- --------------------------------------------------------------------------------
March 31, December 31, March 31,
(In thousands) 2003 2002 2002 (a)
- --------------------------------------------------------------------------------------------------
ASSETS:
Cash and due from depository institutions $ 238,370 $ 266,463 $ 167,160
Short-term investments 13,696 15,596 33,472
Securities:
Trading, at fair value 10,924 5,752 527
Available for sale, at fair value 4,497,686 4,119,245 4,221,800
------------ ------------ ------------
TOTAL SECURITIES 4,508,610 4,124,997 4,222,327
Loans held for sale 321,637 405,157 102,348
Loans:
Residential mortgages 3,657,707 3,386,207 3,561,986
Commercial 1,947,167 1,798,898 1,385,276
Commercial real estate 1,062,891 1,029,332 952,553
Consumer 1,841,526 1,698,202 1,237,098
------------ ------------ ------------
TOTAL LOANS 8,509,291 7,912,639 7,136,913
Allowance for loan losses (118,596) (116,804) (98,930)
------------ ------------ ------------
LOANS, NET 8,390,695 7,795,835 7,037,983
Accrued interest receivable 58,137 54,601 58,928
Premises and equipment, net 82,525 84,683 82,209
Goodwill and intangible assets 320,942 297,359 305,677
Cash surrender value of life insurance 174,181 172,066 165,225
Prepaid expenses and other assets 246,866 251,247 159,766
------------ ------------ ------------
TOTAL ASSETS $ 14,355,659 $ 13,468,004 $ 12,335,095
============ ============ ============
LIABILITIES AND SHAREHOLDERS' EQUITY:
Deposits:
Checking and NOW $ 1,965,636 $ 1,927,880 $ 1,661,341
Savings and MMDAs 3,200,604 2,987,595 2,592,132
Certificates of deposit 2,543,060 2,592,701 2,794,048
------------ ------------ ------------
TOTAL RETAIL DEPOSITS 7,709,300 7,508,176 7,047,521
Treasury deposits 74,509 97,946 121,825
------------ ------------ ------------
TOTAL DEPOSITS 7,783,809 7,606,122 7,169,346
Federal Home Loan Bank advances 2,885,098 2,163,029 2,399,579
Other borrowings 2,030,553 2,166,640 1,377,647
Senior notes and subordinated debt 326,000 126,000 126,000
Accrued expenses and other liabilities 128,921 239,923 98,555
------------ ------------ ------------
TOTAL LIABILITIES 13,154,381 12,301,714 11,171,127
Corporation-obligated mandatorily redeemable
capital securities of subsidiary trusts 121,255 121,255 150,000
Preferred stock of subsidiary corporation 9,577 9,577 9,577
SHAREHOLDERS' EQUITY 1,070,446 1,035,458 1,004,391
------------ ------------ ------------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 14,355,659 $ 13,468,004 $ 12,335,095
============ ============ ============
See Selected Financial Highlights for footnotes.
WEBSTER FINANCIAL CORPORATION
- --------------------------------------------------------------------------------
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
- --------------------------------------------------------------------------------
Three Months Ended
March 31,
(In thousands, except per share data) 2003 2002 (a)
- -----------------------------------------------------------------------------------------------
INTEREST INCOME:
Loans and loans held for sale $ 117,702 $ 111,495
Securities and short-term investments 51,745 59,598
--------- ---------
TOTAL INTEREST INCOME 169,447 171,093
--------- ---------
INTEREST EXPENSE:
Deposits 29,418 39,613
Borrowings 35,353 34,997
--------- ---------
TOTAL INTEREST EXPENSE 64,771 74,610
--------- ---------
NET INTEREST INCOME 104,676 96,483
Provision for loan losses 5,000 4,000
--------- ---------
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES 99,676 92,483
--------- ---------
NONINTEREST INCOME:
Deposit service fees 16,890 13,806
Insurance revenue 10,964 7,436
Loan and loan servicing fees 5,905 3,885
Financial advisory services 5,431 3,959
Trust and investment services 4,578 4,387
Gain on sale of loans and loan servicing, net 2,771 393
Increase in cash surrender value of life insurance 2,115 2,202
Other 1,861 2,010
--------- ---------
TOTAL FEE REVENUE 50,515 38,078
Gain on sale of securities, net 2,633 3,405
--------- ---------
TOTAL NONINTEREST INCOME 53,148 41,483
--------- ---------
NONINTEREST EXPENSES:
Compensation and benefits 50,561 40,148
Occupancy 8,099 6,285
Furniture and equipment 7,521 6,568
Intangible amortization 3,962 4,038
Marketing 3,485 2,424
Professional services 2,478 2,327
Capital securities and preferred stock dividend 3,138 3,832
Other 13,562 10,577
--------- ---------
TOTAL NONINTEREST EXPENSES 92,806 76,199
--------- ---------
Income before income taxes and cumulative effect of change
in accounting method 60,018 57,767
Income taxes 20,081 18,152
--------- ---------
INCOME BEFORE CUMULATIVE EFFECT OF CHANGE IN
ACCOUNTING METHOD 39,937 39,615
Cumulative effect of change in accounting method, net of taxes (b) -- (7,280)
--------- ---------
NET INCOME $ 39,937 $ 32,335
========= =========
NET INCOME PER COMMON SHARE BEFORE CUMULATIVE
EFFECT OF CHANGE IN ACCOUNTING METHOD:
Basic $ 0.88 $ 0.81
Diluted 0.86 0.80
NET INCOME PER COMMON SHARE:
Basic $ 0.88 $ 0.66
Diluted 0.86 0.65
See Selected Financial Highlights for footnotes.
WEBSTER FINANCIAL CORPORATION
- --------------------------------------------------------------------------------
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
- --------------------------------------------------------------------------------
Three Months Ended,
March 31, December 31, September 30, June 30, March 31,
(In thousands, except per share data) 2003 2002 2002 2002 (a) 2002 (a)
- -------------------------------------------------------------------------------------------------------------------------
INTEREST INCOME:
Loans and loans held for sale $ 117,702 $ 120,386 $ 118,492 $ 114,027 $ 111,495
Securities and short-term investments 51,745 53,189 55,507 59,340 59,598
--------- --------- --------- --------- ---------
TOTAL INTEREST INCOME 169,447 173,575 173,999 173,367 171,093
--------- --------- --------- --------- ---------
INTEREST EXPENSE:
Deposits 29,418 33,375 36,169 37,005 39,613
Borrowings 35,353 36,110 35,240 33,797 34,997
--------- --------- --------- --------- ---------
TOTAL INTEREST EXPENSE 64,771 69,485 71,409 70,802 74,610
--------- --------- --------- --------- ---------
NET INTEREST INCOME 104,676 104,090 102,590 102,565 96,483
Provision for loan losses 5,000 16,000 5,000 4,000 4,000
--------- --------- --------- --------- ---------
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES 99,676 88,090 97,590 98,565 92,483
--------- --------- --------- --------- ---------
NONINTEREST INCOME:
Deposit service fees 16,890 17,083 15,797 14,924 13,806
Insurance revenue 10,964 6,875 6,386 6,376 7,436
Loan and loan servicing fees 5,905 6,089 4,346 4,211 3,885
Financial advisory services 5,431 4,964 5,997 4,357 3,959
Trust and investment services 4,578 3,693 3,770 4,068 4,387
Gain on sale of loans and loan servicing, net 2,771 2,337 1,839 1,239 393
Increase in cash surrender value of life insurance 2,115 2,263 2,310 2,267 2,202
Other 1,861 1,129 750 1,047 2,010
--------- --------- --------- --------- ---------
TOTAL FEE REVENUE 50,515 44,433 41,195 38,489 38,078
Gain on sale of securities, net 2,633 13,934 4,912 1,126 3,405
--------- --------- --------- --------- ---------
TOTAL NONINTEREST INCOME 53,148 58,367 46,107 39,615 41,483
NONINTEREST EXPENSES:
Compensation and benefits 50,561 46,343 43,303 41,248 40,148
Occupancy 8,099 7,444 6,665 6,212 6,285
Furniture and equipment 7,521 8,228 7,559 6,812 6,568
Intangible amortization 3,962 3,997 3,978 4,004 4,038
Marketing 3,485 3,038 2,622 2,438 2,424
Professional services 2,478 3,503 2,754 2,820 2,327
Capital securities and preferred stock dividend 3,138 3,355 3,449 3,753 3,832
Acquisition expenses -- -- 1,349 616 --
Other 13,562 13,244 12,450 10,940 10,577
--------- --------- --------- --------- ---------
TOTAL NONINTEREST EXPENSES 92,806 89,152 84,129 78,843 76,199
--------- --------- --------- --------- ---------
Income before income taxes and cumulative effect of
change in accounting method 60,018 57,305 59,568 59,337 57,767
Income taxes 20,081 17,904 19,144 18,765 18,152
--------- --------- --------- --------- ---------
INCOME BEFORE CUMULATIVE EFFECT OF CHANGE
IN ACCOUNTING METHOD 39,937 39,401 40,424 40,572 39,615
Cumulative effect of change in accounting method,
net of taxes (b) -- -- -- -- (7,280)
--------- --------- --------- --------- ---------
NET INCOME $ 39,937 $ 39,401 $ 40,424 $ 40,572 $ 32,335
========= ========= ========= ========= =========
NET INCOME PER COMMON SHARE BEFORE CUMULATIVE
EFFECT OF CHANGE IN ACCOUNTING METHOD:
Basic $ 0.88 $ 0.86 $ 0.85 $ 0.83 $ 0.81
Diluted 0.86 0.85 0.84 0.82 0.80
NET INCOME PER COMMON SHARE:
Basic $ 0.88 $ 0.86 $ 0.85 $ 0.83 $ 0.66
Diluted 0.86 0.85 0.84 0.82 0.65
See Selected Financial Highlights for footnotes.
WEBSTER FINANCIAL CORPORATION
- --------------------------------------------------------------------------------
RETAIL AND WHOLESALE INTEREST-RATE SPREADS (UNAUDITED)
- --------------------------------------------------------------------------------
Three Months Ended, March December September June March
2003 2002 2002 2002 2002
- ------------------------------------------------------------------------------------------
INTEREST-RATE SPREAD
- --------------------
Total interest-earning assets (d) 5.35% 5.61% 5.93% 6.09% 6.24%
Total interest-bearing liabilities 2.09 2.26 2.48 2.57 2.82
---- ---- ---- ---- ----
Interest-rate spread 3.26% 3.35% 3.45% 3.52% 3.42%
Net interest margin 3.30 3.39 3.52 3.61 3.51
RETAIL INTEREST-RATE SPREAD
- ---------------------------
Yield on loans 5.52% 5.71% 6.01% 6.23% 6.39%
Cost of deposits 1.57 1.77 1.96 2.06 2.29
---- ---- ---- ---- ----
Spread 3.95% 3.94% 4.05% 4.17% 4.10%
==== ==== ==== ==== ====
WHOLESALE INTEREST-RATE SPREAD
- ------------------------------
Yield on securities (d) 5.02% 5.40% 5.77% 5.84% 5.98%
Cost of borrowings 2.90 3.07 3.40 3.56 3.85
---- ----- ---- ---- ----
Spread 2.12% 2.33% 2.37% 2.28% 2.13%
==== ==== ==== ==== ====
- --------------------------------------------------------------------------------
CONSOLIDATED AVERAGE STATEMENTS OF CONDITION (UNAUDITED)
- --------------------------------------------------------------------------------
Three Months Ended March 31, 2003 2002
- -------------------------------------------------------------------------------------------------------------------------------
Fully tax- Fully tax-
Average equivalent Average equivalent
(In thousands) balance Interest yield/rate balance Interest yield/rate
- -------------------------------------------------------------------------------------------------------------------------------
ASSETS:
INTEREST-EARNING ASSETS:
Loans and loans held for sale $ 8,552,652 $ 117,702 5.52% $ 6,996,981 $ 111,495 6.39%
Securities and short-term investments 4,235,752 52,089 5.02(d) 4,044,428 59,902 5.98(d)
------------ --------- ---- ------------ --------- ----
TOTAL INTEREST-EARNING ASSETS 12,788,404 169,791 5.35 11,041,409 171,397 6.24
--------- ---------
Noninterest-earning assets 935,423 874,232
------------ ------------
TOTAL ASSETS $ 13,723,827 $ 11,915,641
============ ============
LIABILITIES AND SHAREHOLDERS' EQUITY:
INTEREST-BEARING LIABILITIES:
Interest-bearing deposits $ 6,646,320 $ 29,418 1.80% $ 6,184,667 $ 39,613 2.60%
Noninterest-bearing deposits 951,230 -- -- 838,903 -- --
Federal Home Loan Bank advances 2,581,216 23,791 3.69 2,391,373 27,287 4.56
Repurchase agreements and other borrowings 2,000,136 6,252 1.25 1,116,611 4,920 1.76
Senior notes and subordinated debt 297,111 5,310 7.15 126,000 2,790 8.86
------------ --------- ---- ------------ --------- ----
TOTAL INTEREST-BEARING LIABILITIES 12,476,013 64,771 2.09 10,657,554 74,610 2.82
--------- ---------
Noninterest-bearing liabilities 66,604 86,892
------------ ------------
TOTAL LIABILITIES 12,542,617 10,744,446
Capital securities and preferred stock of
subsidiary corporation 130,832 159,577
Shareholders' equity 1,050,378 1,011,618
------------ ------------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 13,723,827 $ 11,915,641
============ ============
LESS: TAX-EQUIVALENT ADJUSTMENT (344) (304)
--------- ---------
NET INTEREST INCOME $ 104,676 $ 96,483
========= =========
INTEREST-RATE SPREAD 3.26% 3.42%
==== ====
NET INTEREST MARGIN 3.30% 3.51%
==== ====
See Selected Financial Highlights for footnotes.
WEBSTER FINANCIAL CORPORATION
- --------------------------------------------------------------------------------
ASSET QUALITY (UNAUDITED)
- --------------------------------------------------------------------------------
AT OR FOR THE THREE MONTHS ENDED,
--------------------------------------------
March 31, Dec. 31, Sept. 30, June 30, March 31,
(In thousands) 2003 2002 2002 2002 2002
- -----------------------------------------------------------------------------------------------------------------
NONPERFORMING ASSETS
- --------------------
NONPERFORMING LOANS:
Commercial:
Commercial $27,784 $16,001 $19,000 $21,626 $20,461
Specialized industry 3,399 3,399 27,231 3,399 3,399
Equipment financing 8,960 6,586 5,559 6,531 7,510
-------------------------------------------------------
Total commercial 40,143 25,986 51,790 31,556 31,370
Commercial real estate 6,910 9,109 10,124 9,506 11,122
Residential 5,712 7,263 5,521 5,991 6,262
Consumer 1,510 894 1,062 1,409 1,545
-------------------------------------------------------
Total nonperforming loans 54,275 43,252 68,497 48,462 50,299
-------------------------------------------------------
LOANS HELD FOR SALE 3,444 3,706 -- -- --
-------------------------------------------------------
OTHER REAL ESTATE OWNED AND REPOSSESSED ASSETS:
Commercial 3,967 2,568 3,007 2,294 2,690
Residential 234 477 686 635 1,131
Consumer 1 32 12 170 205
-------------------------------------------------------
Total other real estate owned and repossessed assets 4,202 3,077 3,705 3,099 4,026
-------------------------------------------------------
TOTAL NONPERFORMING ASSETS $61,921 $50,035 $72,202 $51,561 $54,325
=======================================================
- --------------------------------------------------------------------------------
SUMMARY OF CLASSIFIED LOANS
- ---------------------------
Substandard:
Accruing $ 74,398 $ 70,245 $102,436 $106,281 $94,864
Nonaccruing 45,005 38,994 62,170 43,634 43,146
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Total substandard 119,403 109,239 164,606 149,915 138,010
Doubtful:
Accruing -- -- 3 6 11
Nonaccruing 7,279 3,743 3,724 3,808 3,756
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Total doubtful 7,279 3,743 3,727 3,814 3,767
Loss -- -- -- -- --
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Total classified loans $126,682 $112,982 $168,333 $153,729 $141,777
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Classified as a percent of loans 1.5% 1.4% 2.1% 2.1% 2.0%
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- --------------------------------------------------------------------------------
ALLOWANCE FOR LOAN LOSSES (UNAUDITED)
- --------------------------------------------------------------------------------
AT OR FOR THE THREE MONTHS ENDED,
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March 31, Dec. 31, Sept. 30, June 30, March 31,
(In thousands) 2003 2002 2002 2002 2002
- ----------------------------------------------------------------------------------------------------------------------------------
ALLOWANCE FOR LOAN LOSSES
- -------------------------
BEGINNING BALANCE $ 116,804 $ 116,118 $ 99,698 $ 98,930 $ 97,307
Allowance for purchased loans 146 -- 16,338 -- --
Provision 5,000 16,000 5,000 4,000 4,000
Write-down of loans transferred to held for sale -- (12,432) -- -- --
Charge-offs:
Residential 78 84 249 187 362
Commercial:
Specialized industry -- 2,569 1,892 854 1,361
All other commercial 3,601 1,031 3,029 2,498 541
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Total commercial 3,601 3,600 4,921 3,352 1,902
Commercial real estate -- -- -- -- --
Consumer 195 220 246 250 377
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Total charge-offs 3,874 3,904 5,416 3,789 2,641
Recoveries (520) (1,022) (498) (557) (264)
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Net loan charge-offs 3,354 2,882 4,918 3,232 2,377
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ENDING BALANCE $ 118,596 $ 116,804 $ 116,118 $ 99,698 $ 98,930
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ASSET QUALITY RATIOS:
- ---------------------
Allowance for loan losses / total loans 1.39% 1.48% 1.45% 1.36% 1.39%
Net charge-offs/ average loans (annualized) 0.16 0.14 0.26 0.18 0.14
Nonperforming loans / total loans 0.64 0.55 0.86 0.66 0.70
Nonperforming assets / total assets 0.43 0.37 0.54 0.41 0.44
Allowance for loan losses / nonperforming loans 218.51 270.05 169.52 205.72 196.68