Tower Bancorp, Inc. Announces Quarterly Earnings
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Strong Earnings, Excellent Asset Quality, and Successful Stock Offering Support Continued Growth
HARRISBURG, Pa.--(BUSINESS WIRE)-- Tower Bancorp, Inc. (NASDAQ: TOBC) (the "Company"), the parent company of Graystone Tower Bank (the "Bank"), reported net income of $1.7 million or $0.30 per diluted share for the third quarter of 2009 compared to net income of $711 thousand or $0.26 per diluted share for the same quarter a year ago.
"Following the very successful offering of our common stock during the quarter to support our continuing growth strategy, we are delighted to report another quarter of strong earnings," said Andrew Samuel, chairman, president and CEO. "The results for the third quarter, which marks the second full quarter following the partnership with Graystone Financial Corp., reflect a continuation of excellent asset quality, in-market core deposit growth, an enhanced capital position and greater efficiencies as we begin to recognize the anticipated cost savings resulting from the integration and systems conversion in connection with the partnership."
Mr. Samuel continued, "During these still uncertain economic times, we remain committed to our relationship-based community banking model and continue to successfully attract and hire experienced in-market banking professionals who share this commitment and are able to contribute high-quality growth. As a result, we believe that Tower Bancorp, Inc. is extremely well positioned to gain market share and grow the organization within the markets we serve without compromising the prudent lending and investment strategies that have been crucial to our success."
Highlights
-- Net income for the third quarter of 2009 was $1.7 million, or $0.30 per
diluted share. The third quarter results included after-tax merger
related expenses of $205 thousand, which negatively impacted earnings.
Excluding merger related expenses, net income would have totaled $1.9
million or $0.33 per diluted share.
-- Assets grew $106.1 million or 8.33% from June 30, 2009 to September 30,
2009, and deposits grew $63.3 million or 5.95% from June 30, 2009 to
September 30, 2009.
-- Non-performing assets at September 30, 2009 comprised 0.55% of total
period-end assets and net loan charge-offs during the quarter totaled
just 0.05% of average loans. The Company's allowance for credit losses
to non-performing loans was 245.26% at September 30, 2009.
-- Non-interest expense decreased $611 thousand or 6.79% from the second
quarter of 2009, excluding merger related expenses and the FDIC special
assessment, as the Company began to realize cost savings from the merger
with Graystone Financial Corp.
-- The Company's strong capital position was bolstered by the successful
completion of a common stock offering during the third quarter of 2009,
which resulted in net proceeds of approximately $51.7 million. The
Company's ratio of total Risk-Based Capital to Risk-Based Assets at
September 30, 2009 equaled 16.14%, substantially exceeding the 10.0%
minimum regulatory requirement to be considered "well capitalized." The
Company's tangible book value totaled $20.89 per share at September 30,
2009, which is an increase of $1.91 or 10.07% from June 30, 2009.
Income Statement Review
Net income available to common shareholders for the third quarter of 2009 equaled $1.7 million or $0.30 per diluted share compared to $711 thousand or $0.26 per diluted share for the same quarter a year ago. The results for the third quarter of 2009 included $205 thousand in after-tax merger related expenses, which negatively impacted earnings. Excluding merger related expenses, net income for the third quarter of 2009 would have totaled $1.9 million or $0.33 per diluted share.
For the nine-month period ended September 30, 2009, the Company recorded net income of $1.7 million or $0.37 per diluted share compared to net income of $1.5 million or $0.56 per diluted share for the same year ago period. During this period, the Company recorded $1.7 million in pre-tax merger related expenses connected to the merger between Tower Bancorp, Inc. and Graystone Financial Corp. that was completed on March 31, 2009. Additionally, the Company's subsidiary bank, Graystone Tower Bank, like all FDIC-insured institutions, recognized an FDIC special assessment of $580 thousand during the second quarter of 2009. Excluding these two items, net income would have totaled $3.3 million or $0.73 per diluted share for the nine-month period ended September 30, 2009.
Net interest income and margin for the third quarter of 2009 was favorably impacted by growth in average earnings assets and a rising tax effected net interest margin, which grew to 3.57%, an increase of 46 basis points from the year ago quarter. When compared to the second quarter of 2009, net interest income grew slightly due to growth in average earning assets, and the net interest margin decreased slightly from 3.63% to 3.57%, resulting primarily from increased levels of liquidity in the form of cash and investment securities on the balance sheet compared to the prior quarter. The Company successfully reduced the cost of its funding during the third quarter, as evidenced by the average rate paid on total interest bearing liabilities decreasing from 2.24% in the second quarter of 2009 to 2.04% in the current quarter. However, the average rate received on loans decreased slightly to 5.95% from 5.98% in the prior quarter, and there was a decrease of 13 basis points in the average rate received on total interest-earning assets as increased liquidity was invested in cash and investment securities. The Company expects strong growth in the loan portfolio during the fourth quarter of 2009 to improve the average rate received on total interest-earning assets, which should have a positive impact on the margin.
Non-interest income was $1.8 million for the third quarter of 2009, which represents 0.58% of average assets. This is an increase of $766 thousand over the same quarter a year ago. Non-interest income growth, including both organic growth and growth through acquisition, was predominately driven by increased service and other charges on deposit accounts and the sale of mortgage loans originated for sale. When compared to the second quarter of 2009, non-interest income for the third quarter of 2009 decreased by $936 thousand, primarily due to decreases in gains on sales of other interest earning assets of $412 thousand, and gains on sale of mortgage loans originated for sale of $247 thousand. During the third quarter of 2009, the Company recognized a $111 thousand net loss on the sale of securities available for sale compared to a $301 thousand net gain during the second quarter of 2009. The sale of securities available for sale is a result of sales of equity securities acquired through the merger between the Company and Graystone Financial Corp. The Company continues its efforts to change the composition of the investment portfolio acquired through the merger to an investment portfolio primarily focused on fixed income securities. As a result, the fair value of the equity portfolio has decreased to $2.1 million at September 30, 2009 compared to a fair value of $4.1 million at June 30, 2009. The unrealized loss in the equity portfolio was $172 thousand at September 30, 2009 compared to an unrealized loss of $271 thousand at June 30, 2009. The Company recognized no impairment charges during the third quarter of 2009. Non-interest income generated through the sale of residential mortgage loans into the secondary market was impacted by a slowdown in the high level of mortgage refinancing activity experienced in the second quarter of 2009. Income from service charges on deposit accounts and other service charges, commissions and fees for the third quarter of 2009 decreased $224 thousand from the second quarter 2009, largely as a result of waiving certain charges and fees on deposit accounts during the third quarter of 2009 as a temporary accommodation to depositors in connection with the systems conversion that was completed during June 2009. These waivers occurred during the first two months of the third quarter and will not be reoccurring. As a result, the service charges and fee income from deposit accounts for the third quarter was less than would be expected during a normalized quarter.
Non-interest expenses were $8.7 million for the third quarter of 2009; however, this amount includes $310 thousand in merger related expenses. Excluding this item, non-interest expenses were $8.4 million or 2.49% of average assets for third quarter of 2009. Total non-interest expenses, excluding merger related expenses and the FDIC special assessment, decreased by $611 thousand or 6.79% compared to the second quarter of 2009. During June 2009, the Company converted the existing systems of the separate bank divisions to one core operating system to enhance operating efficiency and savings relating to data processing and other operational costs. As a result, the third quarter of 2009 is the first quarter that begins to reflect cost savings related to the system conversion associated with the merger that was completed on March 31, 2009. During the third quarter of 2009, the Company has experienced a decrease in salaries and employee benefits expenses of $532 thousand compared to the prior quarter, which is a direct result of cost savings in connection with the merger integration.
Review of Balance Sheet, Credit Quality and Capital Position
Total assets at September 30, 2009 reached $1.379 billion, representing an increase of $106.1 million or 8.33% from June 30, 2009. Total gross loans were $1.005 billion at September 30, 2009, or a decrease of $9.3 million compared to June 30, 2009. During the third quarter of 2009, new commercial and consumer loan originations totaled $37.6 million, which were offset by a net decrease in existing loan balances of $46.9 million. The net decrease in existing loan balances included the reduction of $13.2 million of residential mortgages previously held in the Company's loan portfolio. Management believes that there continues to be strong demand for commercial and consumer loans to credit qualified businesses and individuals within the Company's market areas, which management anticipates will result in increased loan growth during the fourth quarter of 2009.
Total deposits at September 30, 2009 were $1.126 billion, representing an increase of $63.3 million, or 5.95%, from June 30, 2009. Total deposits, excluding time deposits, totaled $721.5 million at September 30, 2009, an increase of $50.8 million or 7.57% from June 30, 2009. The Company's deposit mix continued to be weighted heavily in lower cost demand, savings and money market accounts, which comprised 64.06% of total deposits at the end of the third quarter, compared with 63.10% at June 30, 2009 and 44.05% at December 31, 2008.
Asset quality continues to be a primary focus of the Company as evidenced by the asset quality ratios at September 30, 2009. Non-performing assets were 0.55% of total assets and net loan charge-offs during the third quarter of 2009 totaled just 0.05% of average loans. The allowance for credit losses as of September 30, 2009 was $16.2 million, which consisted of the allowance for loan losses of $8.4 million and the credit fair value adjustment on purchased loans acquired in the merger of $7.8 million. The allowance for credit losses at September 30, 2009 represented 1.61% of total loans outstanding of $1.010 billion, compared to 1.58% at June 30, 2009. The Company's coverage ratio, calculated as the ratio of the allowance for credit losses to non-performing loans, was 245.26% at September 30, 2009.
During the third quarter of 2009, the Company further secured its capital position through a public offering of common stock, which provided net proceeds of approximately $51.7 million. As a result, the Company's tangible book value totaled $20.89 per share at September 30, 2009, which is an increase of $1.91 per share or 10.07% from June 30, 2009. The Company's Tier 1 Risk-Based Capital and Total Risk-Based Capital Ratios at September 30, 2009 were 14.44% and 16.14%, respectively and significantly exceed the "well capitalized" minimum regulatory requirements of 6.00% and 10.00%, respectively. Cash dividends paid to shareholders during the third quarter 2009 were $0.28 per share. To date, the Company has chosen to not participate in the U.S. Treasury Department's Troubled Asset Relief Program (TARP) Capital Purchase Program.
Due to the merger of Tower Bancorp, Inc. and Graystone Financial Corp. on March 31, 2009, all periods prior to March 31, 2009 represent the results of Graystone Financial Corp. as the accounting acquirer in the merger.
The financial information contained on the following pages provides more detail on the Company's performance for the three months ended September 30, 2009, as compared to the three months ended June 30, 2009 and the three months ended September 30, 2008, and for the nine months ended September 30, 2009 as compared with the nine months ended September 30, 2008. Persons seeking additional information should refer to the Company's periodic reports as filed with the Securities and Exchange Commission (SEC).
About Tower Bancorp, Inc.
Tower Bancorp, Inc. is the parent company of Graystone Tower Bank, a full-service community bank operating 26 branch offices in central Pennsylvania and Maryland through two divisions, Graystone Bank and Tower Bank. With total assets of approximately $1.4 billion, Tower Bancorp's unparalleled competitive advantage is its more than 300 employees and a strong corporate culture paired with a clear vision that provides customers with uncompromising service and individualized solutions to every financial need. Tower Bancorp's common stock is listed on the NASDAQ Global Market under the symbol "TOBC." More information about Tower Bancorp and its divisions can be found on the internet at www.yourtowerbank.com, www.graystonebank.com and www.towerbancorp.com.
Safe Harbor for Forward-Looking Statements
This document may contain forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Actual results and trends could differ materially from those set forth in such statements due to various risks, uncertainties and other factors. Such risks, uncertainties and other factors that could cause actual results and experience to differ from those projected include, but are not limited to, the following: ineffectiveness of the company's business strategy due to changes in current or future market conditions; the effects of competition, and of changes in laws and regulations, including industry consolidation and development of competing financial products and services; interest rate movements; changes in credit quality; inability to achieve merger-related synergies; difficulties in integrating distinct business operations, including information technology difficulties; volatilities in the securities markets; and deteriorating economic conditions, and other risks and uncertainties, including those detailed in Tower Bancorp, Inc.'s filings with the Securities and Exchange Commission (SEC). The statements included herein are valid only as of the date hereof and Tower Bancorp, Inc. disclaims any obligation to update this information.
Selected Financial Highlights
Tower Bancorp, Inc. and Subsidiary
Consolidated Balance Sheets
September 30, 2009, June 30, 2009 and December 31, 2008
(Amounts in thousands, except share data)
September 30, June 30, December 31,
2009 2009 2008
Assets (unaudited) (unaudited)
Cash and due from banks $ 115,625 $ 50,791 $ 24,765
Federal funds sold 18,212 73,676 7,257
Cash and cash equivalents 133,837 124,467 32,022
Securities available for sale 160,038 50,946 19,904
Restricted investments 6,254 6,254 2,068
Loans held for sale 4,930 7,490 3,324
Loans, net of allowance for loan 996,367 1,006,249 561,705
losses of $8,390, $7,823, and $6,017
Premises and equipment, net 27,074 26,961 4,546
Accrued interest receivable 4,570 4,160 2,402
Deferred tax asset, net 1,341 1,893 1,764
Bank owned life insurance 24,320 24,067 12,305
Goodwill 12,451 12,119 -
Other intangible assets, net 3,545 3,722 -
Other assets 4,209 4,539 1,278
Total Assets $ 1,378,936 $ 1,272,867 $ 641,318
Liabilities and Stockholders' Equity
Liabilities
Deposits:
Non-interest bearing $ 97,589 $ 96,513 $ 42,466
Interest bearing 1,028,695 966,521 483,004
Total Deposits 1,126,284 1,063,034 525,470
Securities sold under agreements to 7,383 8,516 8,384
repurchase
Short-term borrowings 5,250 7,164 14,614
Long-term debt 63,096 68,441 29,000
Accrued interest payable 1,283 1,364 888
Other liabilities 11,084 12,497 8,177
Total Liabilities 1,214,380 1,161,016 586,533
Stockholders' Equity
Common stock, no par value;
50,000,000 shares authorized;
7,215,023 shares issued and
7,111,665 outstanding at September
30, 2009, 5,162,194 shares issued - - -
and 5,058,836 outstanding at June
30, 2009, and 2,740,325 shares
issued and outstanding at December
31, 2008
Additional paid-in capital 167,961 116,244 57,547
Accumulated deficit (3,881 ) (4,372 ) (2,909 )
Accumulated other comprehensive 476 (21 ) 147
income
Total Stockholders' Equity 164,556 111,851 54,785
Total Liabilities and Stockholders' $ 1,378,936 $ 1,272,867 $ 641,318
Equity
Tower Bancorp, Inc. and Subsidiary
Consolidated Statements of Operations
Three and Nine Months Ended September 30, 2009 and 2008 (unaudited) and the
Three Months Ended June 30, 2009 (unaudited)
(Amounts in thousands, except share data)
Three Months Ended Nine Months Ended
September 30, June 30, September September September
30, 30, 30,
2009 2009 2008 2009 2008
Interest
Income
Loans,
including $ 15,249 $ 15,252 $ 8,199 $ 38,789 $ 22,611
fees
Securities 419 387 142 935 688
Federal
funds sold 56 21 49 83 223
and other
Total
Interest 15,724 15,660 8,390 39,807 23,522
Income
Interest
Expense
Deposits 4,725 4,894 3,812 13,382 11,113
Short-term 102 170 98 304 462
borrowings
Long-term 693 483 249 1,430 591
debt
Total
Interest 5,520 5,547 4,159 15,116 12,166
Expense
Net Interest 10,204 10,113 4,231 24,691 11,356
Income
Provision
for Loan 800 650 675 3,816 1,900
Losses
Net Interest
Income after
Provision 9,404 9,463 3,556 20,875 9,456
for Loan
Losses
Non-Interest
Income
Service
charges on 625 664 191 1,506 559
deposit
accounts
Other
service
charges, 554 739 208 1,450 593
commissions
and fees
Gain on sale
of mortgage
loans 334 581 100 1,182 357
originated
for sale
Gain (loss)
on sale of
other (101) 311 77 210 240
interest
earnings
assets
Income from
bank owned 283 283 165 725 165
life
insurance
Other income 115 168 303 431 380
Total
Non-Interest 1,810 2,746 1,044 5,504 2,294
Income
Non-Interest
Expenses
Salaries and
employee 4,237 4,769 2,013 11,523 5,962
benefits
Occupancy
and 1,462 1,470 617 3,664 1,667
equipment
FDIC
insurance 409 731 72 1,320 198
premiums
Advertising
and 204 141 136 422 275
promotion
Data 627 592 171 1,414 476
processing
Professional 305 284 141 843 445
service fees
Other
operating 1,140 1,588 393 3,241 1,080
expenses
Merger
related 310 106 - 1,722 -
expenses
Total
Non-Interest 8,694 9,681 3,543 24,149 10,103
Expenses
Net Income
Before 2,520 2,528 1,057 2,230 1,647
Income Tax
Expense
Income Tax 820 690 346 577 110
Expense
Net Income $ 1,700 $ 1,838 $ 711 $ 1,653 $ 1,537
Net Income
Per Common
Share
Basic $ 0.30 $ 0.36 $ 0.26 $ 0.37 $ 0.56
Diluted $ 0.30 $ 0.36 $ 0.26 $ 0.37 $ 0.56
Weighted
Average
Common
Shares
Outstanding
Basic 5,638,851 5,058,119 2,734,206 4,495,962 2,734,229
Diluted 5,652,292 5,065,180 2,734,206 4,502,396 2,734,229
Tower Bancorp, Inc. and Subsidiary
Yields on Average Interest-Earning Assets and Interest-Bearing Liabilities
Three Months Ended September 30, 2009 and 2008 (unaudited)
For the Three Months Ended September 30,
2009 2008
Average Interest Average Average Interest Average
Balance Rate Balance Rate
(in thousands)
Interest-earning
assets:
Federal funds $ 41,029 $ 56 0.54 % $ 5,968 $ 49 3.27 %
sold
Investment 81,914 453 2.19 % 20,394 156 3.04 %
securities (1)
Loans 1,016,395 15,249 5.95 % 516,609 8,199 6.31 %
Total
interest-earning 1,139,338 15,758 5.49 % 542,971 8,404 6.14 %
assets
Other assets 196,758 29,717
Total assets $ 1,336,096 $ 572,688
Interest-bearing
liabilities:
Interest-bearing
non-maturity $ 604,448 1,959 1.29 % $ 139,423 692 1.97 %
deposits
Time deposits 399,902 2,766 2.74 % 287,182 3,120 4.32 %
Borrowings 66,634 795 4.73 % 47,367 347 2.91 %
Total
interest-bearing 1,070,984 5,520 2.04 % 473,972 4,159 3.49 %
liabilities
Demand deposits 105,046 35,485
Other 30,294 6,679
liabilities
Stockholders' 129,773 56,552
equity
Total
liabilities and $ 1,336,096 $ 572,688
stockholders'
equity
Net interest 3.44 % 2.65 %
spread
Net interest
income and 10,238 3.57 % 4,245 3.11 %
interest rate
margin FTE
Tax equivalent (34 ) (14 )
adjustment
Net interest 10,204 4,231
income
Ratio of average
interest-earning
assets to
106.4 % 114.6 %
average
interest-bearing
liabilities
(1) The average yields for investment securities available for sale are reported on a
fully taxable-equivalent basis at a rate of 34%
Tower Bancorp, Inc. and Subsidiary
Yields on Average Interest-Earning Assets and Interest-Bearing Liabilities
Nine Months Ended September 30, 2009 and 2008 (unaudited)
For the Nine Months Ended September 30,
2009 2008
Average Interest Average Average Interest Average
Balance Rate Balance Rate
(in thousands)
Interest-earning
assets:
Federal funds $ 34,766 83 0.32 % $ 9,567 223 3.11 %
sold
Investment 50,043 975 2.60 % 27,932 715 3.42 %
securities (1)
Loans 874,933 38,789 5.93 % 468,274 22,611 6.45 %
Total
interest-earning 959,742 39,847 5.57 % 505,773 23,549 6.22 %
assets
Other assets 115,708 18,562
Total assets $ 1,075,451 $ 524,335
Interest-bearing
liabilities:
Interest-bearing
non-maturity $ 454,106 8,200 2.41 % $ 113,854 5,025 5.90 %
deposits
Time deposits 353,136 5,182 1.96 % 269,360 6,088 3.02 %
Borrowings 60,227 1,734 3.85 % 51,230 1,053 2.75 %
Total
interest-bearing 867,469 15,116 2.33 % 434,444 12,166 3.74 %
liabilities
Demand deposits 78,299 31,258
Other 35,548 5,607
liabilities
Stockholders' 94,135 53,026
equity
Total
liabilities and $ 1,075,451 $ 524,335
stockholders'
equity
Net interest 3.24 % 2.48 %
spread
Net interest
income and 24,731 3.45 % 11,383 3.01 %
interest rate
margin FTE
Tax equivalent (40 ) (27 )
adjustment
Net interest 24,691 11,356
income
Ratio of average
interest-earning
assets to
110.6 % 116.4 %
average
interest-bearing
liabilities
(1) The average yields for investment securities available for sale are reported
on a fully taxable-equivalent basis at a rate of 34%
Tower Bancorp, Inc. and Subsidiary
Selected Financial Information
(Dollars in thousands, except share data and ratios)
(Unaudited)
September June 30, December 31,
30, 2009 2009 2008
Reconciliation
of Non-GAAP
Balance Sheet
Data:
Loan loss $ 8,390 $ 7,823 $ 6,017
reserve
Credit fair
value
adjustment on 7,758 8,211 -
purchased
loans (1)
Allowance for 16,148 16,034 6,017
credit losses
Total
Stockholders' 164,556 111,851 54,785
equity
Less: Goodwill
and other 15,996 15,841 -
intangible
assets
Tangible 148,560 96,010 54,785
common equity
Shares 7,111,665 5,058,836 2,740,325
Outstanding
For the Three Months Ended For the Nine Months Ended
September June 30, September September September 30,
30, 2009 2009 30, 2008 30, 2009 2008
Reconciliation
of Non-GAAP
Income
Statement
Data:
Net income $ 1,700 $ 1,838 $ 711 $ 1,653 $ 1,537
Plus: FDIC
special - 580 - 580 -
assessment
Plus:
Merger-related 310 106 - 1,722 -
expenses
Less: Tax
effect of (105) (233) - (653) -
adjustments
Net income
excluding
merger-related 1,905 2,291 711 3,302 1,537
expenses and
FDIC special
assessment
Per Share
Data:
Weighted
average shares 5,638,851 5,058,119 2,734,206 4,495,962 2,734,229
outstanding -
basic
Weighted
average shares 5,652,292 5,065,180 2,734,206 4,502,396 2,734,229
outstanding -
diluted
Book value per $ 23.14 22.11 $ 19.73 $ 23.14 $ 19.73
share
Tangible book
value per 20.89 18.98 19.73 20.89 19.73
share
Basic earnings 0.30 0.36 0.26 0.37 0.56
per share
Diluted
earnings per 0.30 0.36 0.26 0.37 0.56
share
Plus: Per
share impact
of FDIC - 0.11 - 0.13 -
special
assessment
Plus: Per
share impact
of 0.05 0.02 - 0.38 -
merger-related
expenses
Less: Per
share impact (0.02) (0.05) - (0.15) -
of tax effect
of adjustments
Diluted
earnings per
share
excluding
non-recurring 0.33 0.44 0.26 0.73 0.56
merger
expenses and
FDIC special
assessment
Performance
Ratios:
Return on 0.50% 0.59% 0.49% 0.21% 0.39%
average assets
Return on 5.20% 6.62% 5.00% 2.35% 3.87%
average equity
Net interest 3.57% 3.63% 3.11% 3.45% 3.01%
margin
Efficiency 69.79% 69.95% 67.17% 72.35% 74.01%
ratio (2)
Non-interest
income to 0.58% 0.89% 0.72% 2.03% 0.58%
average assets
Non-interest
expenses to 2.58% 3.13% 2.45% 8.91% 2.57%
average assets
September June 30, December 31,
30, 2009 2009 2008
Asset Quality
Ratios:
Loan loss
reserve to 0.84% 0.77% 1.06%
gross loans
Credit loss
reserve to 1.61% 1.58% 1.06%
gross loans
Non-accrual
loans to gross 0.47% 0.49% 0.24%
loans
Net
charge-offs to 0.05% 0.06% 0.32%
average loans
(3)
Non-performing
assets to 0.55% 0.53% 0.21%
total assets
(4)
Non-performing
loans to total 0.66% 0.62% 0.26%
loans (5)
Allowance for
loan losses to 127.43% 125.01% 409.32%
non-performing
loans
Allowance for
credit losses
to 245.26% 256.22% 409.32%
non-performing
loans
Capital
Ratios:
Tier 1 capital
(to total 11.05% 7.84% 8.50%
assets)
Tier 1 capital
(to 14.44% 9.25% 9.10%
risk-weighted
assets)
Total capital
(to 16.14% 10.87% 10.10%
risk-weighted
assets)
Tangible
common equity
to tangible 10.90% 7.64% 8.54%
Assets (6)
The credit fair value adjustment relates to the risk of credit loss related
(1) to the portfolio of loans of acquired through the merger between Tower
Bancorp. Inc. and Graystone Financial Corp.
Efficiency ratio is calculated as total non-interest expense (less
(2) merger-related expenses and FDIC special assessment) divided by the total
of net interest income and non-interest income.
(3) Calculated as the net loans charged off during the quarter ended divided by
the average loans outstanding for the same quarter.
(4) Non-performing assets equals the sum of non-accrual loans, loans past due
90 days or greater that are still accruing, and other real estate owned.
(5) Non-performing loans equals the sum of non-accrual loans and loans past due
90 days or greater that are still accruing.
(6) Tangible assets are calculated as total assets less goodwill and other
intangible assets.
Source: Tower Bancorp, Inc.
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