Provident New York Bancorp Announces Fiscal 2009 Earnings of $0.67 per Diluted Share, an Increase of 10%
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MONTEBELLO, N.Y.--(BUSINESS WIRE)-- Provident New York Bancorp (NASDAQ-Global Select Market: PBNY), the parent company of Provident Bank, today announced fourth-quarter results for the fiscal year ending Sept. 30, 2009. Net income for the quarter was $5.1 million, or $0.13 per diluted share, compared to net income of $6.5 million, or $0.17 per diluted share for the fourth quarter of fiscal 2008. Net income for the twelve months ended September 30, 2009 was $25.9 million, or $0.67 per diluted share, compared to $23.8 million, or $0.61 per diluted share for the same period in 2008.
President's Comments
"While fiscal 2009 proved to be a challenging year for the banking industry as a whole, we continued to perform well under the difficult economic and real estate market conditions," said George Strayton, President and CEO. "Although, earnings increased by 9% to $25.9 million over last year, loan charge offs for the year amounted to $10.7 million or 0.62 percent of average loans and were centered on our small business loan area which we identify as 'community business portfolio.' We continued to control expenses exclusive of an FDIC special assessment and were able to reduce the impact of faster prepayments by monetizing gains on mortgage backed securities, totaling $10.7 million after tax. These actions resulted in a gain in EPS year over year which fortified an already strong capital position. New business opportunities arose as non-bank loan originators exited the market and bank consolidations in our market led consumers to seek new banking relationships with strong stable banks. As a result, our average level of transaction and savings accounts grew $81 million and our loan portfolio excluding residential mortgages grew by $24 million. As we move forward, we are focused on reducing the amount of classified and criticized loans resulting from the business downturn and taking advantage of new business opportunities presented in the market place."
Overview of Fiscal 2009
The past two years have been a period of contraction for the economy on a global as well as a local level. This economic slowdown has impacted our banking operations and many of our borrowers. While most of our portfolios have held their credit quality, our community business borrowers were the first to reflect the impact of this slowdown. In fiscal 2008 net charge offs in the community business sector were $3.5 million and increased to $6.9 million in fiscal 2009, primarily in the first half of the year. In fiscal 2009, our ADC portfolio began to show deterioration from the continuing contraction in the residential real estate markets. We therefore have increased the allowance for loan losses to reflect the increase in criticized and classified loans. The result is that provisions for loan losses increased from $7.2 million in fiscal 2008 to $17.6 million in fiscal 2009.
The economic decline has caused the Federal Reserve to engage in quantitative easing, as well as decreasing short term interest rates by 450 basis points in the past two fiscal years ending at an unprecedented federal funds target rate of zero to 0.25 percent. This resulted in increases in the fair values in our investment portfolio, but also increased the likelihood of significant prepayments. Management decided to monetize a portion of the appreciation and recorded $18.1 million in gains on sales of securities. The reinvestment of proceeds in shorter term securities, coupled with the impact of the general reduction in short term interest rates, resulted in a decrease in net interest margin from 3.96 percent in fiscal 2008 to 3.81 percent in fiscal 2009 and net interest income therefore declined by $1.5 million from fiscal 2008.
Additionally, conforming fixed rate residential mortgages were sold into the secondary market in 2009 netting $1.0 million in gains on sales of loans and the bank recorded $736,000 in nontaxable proceeds for a BOLI death benefit. Non-interest expense increased $4.7 million over fiscal 2008 levels due to increased levels of FDIC assessments of $3.4 million and increases in pension and medical benefit costs of $1.5 million. This resulted in net income of $25.9 million in fiscal 2009 compared to $23.8 million in fiscal 2008.
Credit Quality key items for the quarter
-- Non-accrual loans increased a $1.3 million over June 30, 2009 levels to
$21.9 million, but were essentially unchanged from March 31, 2009, while
non-performing loans increased from $23.8 million at June 30, 2009 to
$26.5 million at September 30, 2009.
- Classified loans (i.e. substandard and doubtful) increased from $44.2 million to $89.4 million during the quarter, primarily due to downgrades in the Acquisition, Development and Construction ("ADC") portfolio. A loan that is not performing as originally planned requires a credit downgrade despite the fact that payments are still being made and interest is accruing.
- The loan-loss provision for the fourth quarter was $4.5 million, an increase of $1.0 million from the linked quarter and an increase of $2.4 million over the same quarter in fiscal 2008. The provision for the quarter was $2.0 million in excess of net charge-offs.
- Allowance for loan losses totaled $30.1 million, or 1.76 percent of loans outstanding and 114 percent of non-performing loans as of September 30, 2009.
Other Key items for the quarter include:
-- Realized gains on sales of securities were $1.6 million for the three
months ended September 30, 2009 compared to $10.0 million for the linked
quarter ended June 30, 2009.
-- Net interest margin on a fully tax-equivalent basis was 3.71 percent for
the fourth quarter of fiscal 2009, compared to 3.74 percent for the
linked quarter and 4.16 percent for the fourth quarter of fiscal 2008.
-- Commercial transaction accounts grew $16.3 million or 7.4 percent over
the linked quarter. Total transaction accounts were $844.9 million at
September 30, 2009, compared to $614.3 million at June 30, 2009.
Municipal tax deposits, which are included in transaction account
balances, were $201 million at September 30, 2009.
-- The Bank remained well capitalized at September 30, 2009, with total
risk-based capital ratio of 13.83 percent and a Tier 1 leverage ratio of
8.64 percent. The Company's tangible capital ratio as a percent of
tangible assets was 9.14 percent compared to 9.55 percent at June 30,
2009.
Credit Quality:
The performance of certain sectors of our loan portfolio, specifically the credit scored Community Business and ADC portfolio, continue to reflect weak real estate conditions. However, we have seen improvement in our community business portfolio as charge offs have abated in recent quarters. There has been no appreciable deterioration in loan quality in our residential mortgage, Commercial and Industrial ("C&I") and commercial mortgage portfolios. Non performing residential mortgages and commercial mortgages are approximately 1.0 percent of their respective total portfolios. C&I and consumer non- performing loans are both less than 0.5 percent of respective outstandings.
Net charge-offs for the year and for the quarter have been concentrated in the community business portfolio, while credit downgrades are concentrated in the ADC portfolio. Net charge-offs in the community business portfolio were $879,000 on average outstandings of $100.6 million for the fourth quarter and $6.8 million on average outstandings of $104.0 million for the year ended September 30, 2009.
We continue to experience credit downgrades in the ADC portfolio as the extended period of reduced activity has stressed the liquidity resources of many borrowers, even though many continue to make current interest payments. Largely driven by downgrades in this portfolio, substandard loans, which include all non-performing loans, grew to $89.4 million ($46.1 million is related to ADC loans) at September 30, 2009 from $44.2 million as of June 30, 2009. The greater growth in the substandard category as compared to the more modest growth in nonperforming loans is primarily caused by our downgrades in the ADC portfolio although many borrowers continue to pay interest on a current basis.
All significant loans classified substandard or special mention are reviewed for impairment, under applicable accounting and regulatory standards. Specific reserves for impairment were $3.0 million at September 30, 2008, $5.9 million at June 30, 2009 and $6.4 million at September 30, 2009. These reserves are included in the balance of the allowance for loan losses of $30.1 million at September 30, 2009.
Provident has $674,000 in addition to non accrual loans classified as Troubled Debt Restructures ("TDRs") as of September 30, 2009.
The table below outlines non-performing loans at September 30, 2009, by category with the related weighted loan to value ratios and specific reserves against such loans:
WLTV after
Book Specific Specific
Loans with Specific Reserves Value WLTV* Reserve Reserve
ADC $ 7,124,121 83 % $ 1,353,209 65 %
Commercial mortgage 1,872,690 69 373,820 56
Residential mortgage 2,856,538 88 741,246 75
Loans with out Specific
Reserves
ADC 4,207,255 86 - 86
Commercial mortgage 4,227,333 70 - 70
Residential Mortgage 5,016,366 72 - 72
Total Mortgage secured 25,304,303 79 2,468,275 71
Loans not Mortgage Secured
Loans with specific reserves 230,645 51,721
Loans without specific 934,152 -
reserves
Total non-performing loans 26,469,100 2,519,996
General reserves 27,530,004
Troubled Debt Restructures 673,731
Total allowance for loan $ 30,050,000
losses
ORE balance 1,712,237
Total non-performing assets $ 28,855,068
*Weighted average LTV is the gross loan value plus negative escrows (before specific reserves) divided by current appraised value of the collateral securing the loan.
The following table reflects activity in millions on our ADC portfolio for fiscal 2009:
ADC Loan Portfolio as of October 1, 2008 $ 171 New Loans Advanced 37 Seasoned Loans Advanced 30 Total Advanced 67 Charge-offs 2 New Loan Payments 1 Seasoned Loan Payments 41 ADC Loan Portfolio as of September 30, 2009 $ 194
Net Interest Income and Margin
Fourth quarter fiscal 2009 compared with fourth quarter fiscal 2008
Net interest income was $22.5 million for the fourth quarter of fiscal 2009, a $3.1 million decrease from the same quarter of fiscal 2008. The net interest margin on a tax-equivalent basis was 3.71 percent for the fourth quarter of fiscal 2009, compared to 4.16 percent for same period a year ago. The year-over-year comparison reflects the impact of the cuts in the federal funds target rate totaling 175 basis points. The Company executed on its planned sale program, starting in February 2009, of approximately $350 million in mortgage backed securities with a book yield of 5.15 percent and an average life of 4.1 years, which were reinvested in securities having a yield of 3.34 percent and an average life of 3.2 years. The tax-equivalent yield on investments decreased 132 basis points compared to the same quarter in 2008. As a result, the yield on interest-earning assets declined 94 basis points. For the same period, the cost of interest-bearing deposits decreased 70 basis points to 0.84 percent, and the cost of borrowings increased 45 basis points to 3.92 percent, reflecting the carry cost of term borrowings outstanding and repayment of short-term borrowings.
Fourth quarter fiscal 2009 compared with linked quarter ended June 30, 2009
Net interest income for the quarter ended September 30, 2009, decreased $263,000 from the quarter ended June 30, 2009. The tax-equivalent net interest margin decreased 3 basis points from 3.74 percent for the same period. During the quarter the Bank sold $83.3 million in securities and purchased $250.4 million. The overall yield of the investment portfolio declined 83 basis points during the fourth quarter. Further, proceeds from normal principal payments have been kept liquid at the Federal Reserve, earning 25 basis points on an average balance of $42.0 million. While this decision significantly enhanced the liquidity position of the Bank, the low yield received had an 8 basis point negative impact on the net interest margin.
Noninterest Income
Fourth quarter fiscal 2009 compared with fourth quarter fiscal 2008
Noninterest income totaled $7.8 million for the fiscal fourth quarter, an increase of $2.5 million from $5.3 million in the fourth quarter of fiscal 2008. The increase was due to gains of $1.6 million resulting from the Company's decision to realize a portion of the recent appreciation in its securities portfolio, monetizing other comprehensive income and reducing prepayment risk. Other factors contributing to the increase were gains on the sale of $9.2 million of loans of $215,000, and $736,000 received on the payment of a death claim from Bank Owned Life Insurance during the fourth quarter. The Bank has been selling current conforming fixed rate residential mortgage loan originations in the secondary market to control interest rate risk. Fee income was relatively unchanged in the fourth quarter.
Fourth quarter fiscal 2009 compared with linked quarter ended June 30, 2009
Noninterest income decreased on a linked-quarter basis, due to high levels of securities gains realized, partially offset by a death payment received from Bank Owned Life Insurance and gains on the sales of loans.
Noninterest Expense
Fourth quarter fiscal 2009 compared with fourth quarter fiscal 2008
The Company remained focused on controlling operating expenses, and as a result, non interest expense remained relatively unchanged decreasing $140,000 when compared to the fourth quarter fiscal 2008.
Fourth quarter fiscal 2009 compared with linked quarter ended June 30, 2009
On a quarter-to-quarter basis, non-interest expense decreased due to the expenses related to FDIC special assessments recognized in the third quarter.
Income Taxes
The Company's effective tax rate was 28.2 percent for fiscal 2009 and 29.4 percent for fiscal 2008. For the linked quarter ended June 30, 2009, the Company's effective tax rate was 31.0 percent.
Key Balance Sheet Changes at September 30, 2009 compared to September 30, 2008
-- Net loan balances decreased year over year by $35.2 million. While loan
demand is softer than a year ago due to the economic slowdown,
commercial loan originations during the year were $342 million.
Residential originations were $76.8 million, essentially flat over 2008
levels. Fixed rate conforming residential loan sales into the secondary
market totaled $44.1 million during 2009, as the Company mitigated
interest rate exposure. Gross loans totaled $1.70 billion, compared to
$1.73 billion compared to September 30, 2008.
-- Securities increased $42.5 million to $877.2 million, as the Company
repositioned its investment portfolio during 2009.
-- Borrowings decreased $83.9 million to $482.1 million as the increase in
deposits, at lower rates, made it beneficial to reduce borrowings.
-- Commercial transaction accounts continued to grow, up $32.8 million over
the prior year. Period-end total deposits increased $93.1 million from
September 30, 2008. Municipal transaction account balances due to
seasonal tax collections were $242 million and $201 million at September
30, 2008 and 2009 respectively. Money market accounts increased $78.1
million to $384.6 million as municipalities left additional funds on
deposit that historically would have been competitively bid on a term
basis as certificates of deposits.
Capital and Liquidity
Provident Bank remained well-capitalized with excellent liquidity in the fourth quarter, as it continued to build capital during fiscal 2009, with the Bank's Tier 1 leverage ratio at 8.64 percent. The Company's tangible capital as a percent of tangible assets increased to 9.14 percent as of September 30, 2009, while its tangible book value improved to $6.60 from $5.78 at September 30, 2008. Total capital increased $28.3 million from September 30, 2008, to $427.5 million at September 30, 2009, due to a $14.5 million increase in the Company's retained earnings and a $12.1 million improvement in accumulated other comprehensive income, after realizing securities gains in the fiscal year of $18.1 million. The Company repurchased 86,860 common shares, at a cost of $804,000 during the quarter.
The Bank continued to focus on increasing its liquidity, and strengthening its balance sheet, which resulted in a compression in net interest margin in the quarter. As of September 30, 2009, the Bank maintained $41.3 million in cash at the Federal Reserve Bank compared to $6.7 million at September 30, 2008 for enhanced liquidity purposes. Further, the Bank has no outstanding overnight borrowings under its $200 million line of credit facility with the Federal Home Loan Bank. The Company's high-quality available for sale investment portfolio consists primarily of securities issued by U.S. Government Sponsored Agencies and general obligations of municipalities and provides an additional source of liquidity.
Additional Information
-- The sharp rise in FDIC insurance premiums during the year has added $3.4
million to the Company's noninterest expense during fiscal 2009. The
FDIC approved a new plan on May 22, 2009, which imposed a special
assessment on insured banks of 5 basis points of total assets, in
addition to regular insurance premiums. This special assessment is
reflected fully upon the books of the Company as of September 30, 2009.
-- The Company holds $364.6 million in mortgage backed securities issued by
FHLMC and FNMA. It also holds private label CMO pass through securities
having a fair value of $10.4 million and an amortized cost basis of
$11.2 million all of which were performing at September 30, 2009.
About Provident New York Bancorp
Headquartered in Montebello, New York, Provident New York Bancorp is the parent company of Provident Bank, an independent full-service community bank. Provident Bank operates 33 branches that serve the Hudson Valley region and Bergen County, New Jersey. The Bank offers a complete line of commercial, retail and investment management services. For more information, visit the Company's web site at www.providentbanking.com.
FORWARD-LOOKING STATEMENTS AND ASSOCIATED RISK FACTORS
In addition to historical information, this earnings release may contain forward-looking statements for purposes of applicable securities laws. Any statements contained herein that are not statements of historical fact may be deemed to be forward-looking statements. Forward-looking statements are subject to numerous assumptions, risks and uncertainties. There are a number of important factors described in documents previously filed by the Company with the Securities and Exchange Commission, and other factors that could cause the Company's actual results to differ materially from those contemplated by such forward-looking statements. The Company undertakes no obligation to publicly release the results of any revisions to those forward-looking statements which may be made to reflect events or circumstances after the date of this release or to reflect the occurrence of unanticipated events.
Financial information contained in this release should be considered to be an estimate pending completion of the annual audit of the Company's financial statements and the filing of its fiscal 2009 Annual Report on Form 10-K with the Securities and Exchange Commission. While the Company is not aware of any need to revise the results disclosed in this release, the Company's auditors currently are reviewing the Company's testing of the carrying amount of goodwill on its financial statements in view of the relationship between the Company's book value per share and the market price of its common stock at the end of the fiscal year. Moreover, accounting literature may require adverse information received by management between the date of this release and the filing of the 10-K to be reflected in the results of fiscal 2009, even though the new information was received by management in fiscal 2010 subsequent to the date of this release.
Provident New York Bancorp and Subsidiaries
CONSOLIDATED CONDENSED STATEMENTS OF FINANCIAL CONDITION
(unaudited, in thousands, except share and per share data)
September 30, September 30,
2009 2008
Assets:
Cash and due from banks $ 160,408 $ 125,810
Total securities 877,197 834,701
Loans held for sale 1,213 189
Loans:
One- to four-family residential 460,728 513,381
mortgage loans
Commercial real estate, commercial 797,179 798,453
business
Acquisition, development and 193,828 170,979
construction loans
Consumer loans 251,522 248,740
Total loans, gross 1,703,257 1,731,553
Allowance for loan losses (30,050 ) (23,101 )
Total loans, net 1,673,207 1,708,452
Federal Home Loan Bank stock, at cost 23,177 28,675
Premises and equipment, net 40,692 36,716
Goodwill 160,861 160,861
Other amortizable intangibles 5,489 7,674
Bank owned life insurance 49,611 47,650
Other assets 30,038 33,643
Total assets $ 3,021,893 $ 2,984,371
Liabilities:
Deposits
Retail $ 169,122 $ 162,161
Commercial 236,516 203,682
Municipal 86,596 122,047
Personal NOW deposits 127,595 115,442
Business NOW deposits 36,972 20,881
Municipal NOW deposits 188,074 196,581
Total transaction accounts 844,875 820,794
Savings 357,814 335,986
Money market deposits 384,632 306,504
Certificates of deposit 494,961 525,913
Total deposits 2,082,282 1,989,197
Borrowings 430,628 566,008
Borrowings Senior Note 51,494 -
Mortgage escrow funds and other 30,033 30,008
Total liabilities 2,594,437 2,585,213
Stockholders' equity 427,456 399,158
Total liabilities and $ 3,021,893 $ 2,984,371
stockholders' equity
Shares of common stock outstanding at 39,547,207 39,815,213
period end
Book value per share $ 10.81 $ 10.03
Provident New York Bancorp and Subsidiaries
CONSOLIDATED CONDENSED STATEMENTS OF INCOME
(unaudited, in thousands, except share and per share data)
Quarter
Quarter Ended Ended Twelve Months Ended
September 30, June 30, September 30,
2009 2008 2009 2009 2008
Interest and
dividend
income:
Loans and $ 23,615 $ 26,532 $ 23,848 $ 97,149 $ 107,633
loan fees
Securities 4,666 7,889 5,460 25,552 31,947
taxable
Securities 1,841 1,767 1,915 7,520 6,832
non-taxable
Other
earning 360 518 428 1,369 2,570
assets
30,482 36,706 31,651 131,590 148,982
Interest
expense:
Deposits 3,190 5,449 4,104 18,375 28,344
Borrowings 4,829 5,720 4,821 19,345 25,298
Total
interest 8,019 11,169 8,925 37,720 53,642
expense
Net interest 22,463 25,537 22,726 93,870 95,340
income
Provision for 4,500 2,100 3,500 17,600 7,200
loan losses
Net interest
income after 17,963 23,437 19,226 76,270 88,140
provision for
loan losses
Non-interest
income:
Deposit fees
and service 3,137 3,246 3,083 12,393 12,429
charges
Net gain on
sales of 1,630 - 10,023 18,076 983
securities
Title
insurance 337 300 254 1,005 919
fees
Bank owned
life 1,248 515 502 2,755 1,832
insurance
Gain on sale
of premises - - - 517 -
and
equipment
Gain on sale 215 - 450 961 -
of loans
Investment
management 747 770 622 2,576 3,012
fees
Other 490 475 321 1,670 1,867
Total
non-interest 7,804 5,306 15,255 39,953 21,042
income
Non-interest
expense:
Compensation 9,894 10,109 10,058 39,520 37,045
and benefits
Stock-based
compensation 621 916 639 2,942 3,809
plans
Occupancy
and office 3,195 3,125 3,310 12,802 12,434
operations
Advertising
and 629 710 614 3,093 3,338
promotion
Professional 720 751 788 3,090 3,339
fees
Data and
check 563 638 558 2,284 2,551
processing
Amortization
of 513 611 531 2,185 2,599
intangible
assets
FDIC
insurance
and 752 234 2,305 4,257 875
regulatory
assessments
ATM/debit 563 524 564 2,115 1,936
card expense
Other 1,909 1,881 2,150 7,899 7,574
Total
non-interest 19,359 19,499 21,517 80,187 75,500
expense
Income before
income tax 6,408 9,244 12,964 36,036 33,682
expense
Income tax 1,332 2,749 4,014 10,175 9,904
expense
Net income $ 5,076 $ 6,495 $ 8,950 $ 25,861 $ 23,778
Per common
share:
Basic $ 0.13 $ 0.17 $ 0.23 $ 0.67 $ 0.61
earnings
Diluted 0.13 0.17 0.23 0.67 0.61
earnings
Dividends 0.06 0.06 0.06 0.24 0.24
declared
Weighted
average
common
shares:
Basic 38,405,947 38,589,361 38,536,716 38,537,881 38,907,372
Diluted 38,532,411 38,893,860 38,683,135 38,705,837 39,226,641
Selected Financial Three Months Ended
Condition Data:
(in thousands
except share and 09/30/09 06/30/09 03/31/09 12/31/08 09/30/08
per share data)
End of Period
Total assets $ 3,021,893 $ 2,824,356 $ 2,954,701 $ 2,921,551 $ 2,984,371
Loans, gross (1) 1,703,257 1,714,429 1,735,507 1,746,605 1,731,553
Securities 832,583 689,286 739,595 795,017 791,688
available for sale
Securities held to 44,614 42,790 50,630 50,561 43,013
maturity
Bank owned life 49,611 49,106 48,654 48,163 47,650
insurance
Goodwill 160,861 160,861 160,861 160,861 160,861
Other amortizable 5,489 6,002 6,533 7,090 8,329
intangibles
Other non-earning 70,730 68,735 72,843 66,072 67,318
assets
Deposits 2,082,282 1,872,983 2,008,766 1,898,142 1,989,197
Borrowings 482,122 488,228 490,139 566,519 566,008
Equity 427,456 420,775 421,406 416,998 399,158
Other
comprehensive
income / (loss)
(SFAS 115),
reflected in
stockholders' 9,502 1,531 6,977 6,597 (5,892 )
equity
Average Balances
Total assets $ 2,837,511 $ 2,875,999 $ 2,961,719 $ 2,907,948 $ 2,867,613
Loans, gross:
Real estate-
residential 465,472 484,276 504,406 510,386 513,016
mortgage
Real estate-
commercial 548,195 547,846 551,011 553,483 552,930
mortgage
Real estate-
Acquisition, 191,826 190,875 185,911 176,135 159,698
Development &
Construction
Commercial and 246,590 245,375 248,047 246,913 244,537
industrial
Consumer loans 252,667 254,475 254,216 249,738 241,776
Loans total (1) 1,704,750 1,722,847 1,743,591 1,736,655 1,711,957
Securities 576,363 520,948 623,470 647,414 629,322
(taxable)
Securities 192,733 196,385 197,786 189,316 183,115
(non-taxable)
Total earning 2,511,431 2,549,237 2,632,350 2,582,405 2,535,187
assets
Non earning assets 326,080 326,762 329,369 325,543 332,426
Non-interest 402,643 373,252 365,971 380,021 379,679
bearing checking
Interest bearing 228,761 227,039 241,190 231,807 198,621
NOW accounts
Total transaction 631,404 600,291 607,161 611,828 578,300
accounts
Savings (including
mortgage escrow 386,943 378,263 352,199 347,826 371,499
funds)
Money market 394,718 394,628 405,221 304,346 302,205
deposits
Certificates of 494,530 575,713 646,527 595,595 539,269
deposit
Total deposits and 1,907,595 1,948,895 2,011,108 1,859,595 1,791,273
mortgage escrow
Total interest 1,504,952 1,575,643 1,645,137 1,479,574 1,411,594
bearing deposits
Borrowings 488,443 488,846 511,340 628,988 655,281
Equity 423,361 421,529 417,652 401,104 402,314
Selected Operating
Data:
Condensed Tax
Equivalent Income
Statement
Interest and $ 30,482 $ 31,651 $ 33,586 $ 35,871 $ 36,706
dividend income
Tax equivalent 991 1,031 1,029 998 951
adjustment*
Interest expense 8,019 8,925 9,951 10,825 11,169
Net
interest 23,454 23,757 24,664 26,044 26,488
income (tax
equivalent)
Provision for loan 4,500 3,500 7,100 2,500 2,100
losses
Net
interest
income
after
provision
for loan
losses 18,954 20,257 17,564 23,544 24,388
Non-interest 7,804 15,255 11,123 5,771 5,306
income
Non-interest 19,359 21,517 20,076 19,235 19,499
expense
Income before 7,399 13,995 8,611 10,080 10,195
income tax expense
Income tax expense 2,323 5,045 3,067 3,789 3,700
(tax equivalent)*
Net income $ 5,076 $ 8,950 $ 5,544 $ 6,291 $ 6,495
(1) Does not reflect allowance for loan losses of $30,050, $28,027, $26,437, $23,645 and
$23,101
* Tax exempt income assumed at a 35% federal rate
Three Months Ended
09/30/09 06/30/09 03/31/09 12/31/08 09/30/08
Performance
Ratios
(annualized)
Return on 0.71 % 1.25 % 0.76 % 0.86 % 0.90 %
Average Assets
Return on 4.76 % 8.52 % 5.38 % 6.22 % 6.42 %
Average Equity
Non-Interest
Income to 1.09 % 2.13 % 1.52 % 0.79 % 0.74 %
Average Assets
Non-Interest
Expense to 2.71 % 3.00 % 2.75 % 2.62 % 2.71 %
Average Assets
Operating
Efficiency 63.59 % 71.73 % 65.7 % 60.2 % 59.4 %
Adjusted (2)
Analysis of
Net Interest
Income
Yield on:
Loans 5.59 % 5.64 % 5.63 % 5.98 % 6.25 %
Investment
Securities- 3.87 % 4.70 % 5.17 % 5.09 % 5.19 %
Tax Equivalent
Earning
Assets- Tax 4.97 % 5.14 % 5.33 % 5.66 % 5.91 %
Equivalent
Cost of:
Interest
Bearing 0.84 % 1.04 % 1.30 % 1.56 % 1.54 %
Deposits
Borrowings 3.92 % 3.96 % 3.71 % 3.17 % 3.47 %
Interest
Bearing 1.60 % 1.73 % 1.87 % 2.04 % 2.15 %
Liabilities
Net Interest
Tax
Equivalent:
Net Interest
Rate Spread- 3.38 % 3.41 % 3.46 % 3.63 % 3.76 %
Tax Equivalent
Basis
Net Interest
Margin- Tax 3.71 % 3.74 % 3.80 % 4.00 % 4.16 %
Equivalent
Basis
Capital
Information
Data
Tier 1
Leverage 8.64 % 9.04 % 8.49 % 8.32 % 8.01 %
Ratio- Bank
Only
Tier 1
Risk-Based 246,339 240,392 235,902 229,395 226,053
Capital- Bank
Only
Total
Risk-Based 270,807 264,076 259,686 253,040 249,154
Capital- Bank
Only
Tangible
Capital 261,106 253,912 254,012 249,047 229,968
Consolidated
Tangible
Capital as a %
of Tangible
Assets 9.14 % 9.55 % 9.11 % 9.04 % 8.17 %
Consolidated
Shares 39,547,207 39,613,454 39,876,754 39,832,857 39,815,213
Outstanding
Shares
Repurchased 86,860 315,650 - 13,301 34,122
during qrtr
(open market)
Basic weighted
common shares 38,405,947 38,536,716 38,627,212 38,583,580 38,589,361
outstanding
Diluted common
shares 38,532,411 38,683,135 38,811,114 38,818,569 38,893,860
outstanding
Per Common
Share:
Basic Earnings $ 0.13 0.23 $ 0.14 $ 0.16 $ 0.17
Diluted 0.13 0.23 0.14 0.16 0.17
Earnings
Dividends Paid 0.06 0.06 0.06 0.06 0.06
Book Value 10.81 10.62 10.57 10.47 10.03
Tangible Book 6.60 6.41 6.37 6.25 5.78
Value
Asset Quality
Measurements
Non-performing
loans (NPLs): $ 21,909 20,600 $ 21,567 $ 13,486 $ 13,589
non-accrual
Non-performing
loans (NPLs): 4,560 3,180 4,861 4,561 3,289
still accruing
Troubled Debt 674 1,199 0 0 0
Restructures
Non-performing 28,855 26,566 28,202 19,821 16,962
assets (NPAs)
Net 2,477 1,910 4,308 1,957 1,001
Charge-offs
Net
Charge-offs as
%
of average
loans 0.58 % 0.44 % 0.99 % 0.45 % 0.23 %
(annualized)
NPLs as % of 1.55 % 1.39 % 1.52 % 1.03 % 0.97 %
total loans
NPAs as % of 0.95 % 0.90 % 0.95 % 0.68 % 0.57 %
total assets
Allowance for
loan losses as 114 % 118 % 100 % 131 % 137 %
% of NPLs
Allowance for
loan losses as 1.76 % 1.63 % 1.52 % 1.35 % 1.33 %
% of total
loans
(2) The efficiency ratio represents non-interest expense divided by the sum of net
interest income and non-interest income. As in the case of net interest income,
generally, net interest income as utilized in calculating the efficiency ratio is
typically expressed on a tax-equivalent basis. Moreover, most financial institutions, in
calculating the efficiency ratio, also adjust both noninterest expense and noninterest
income to exclude from these items (as calculated under generally accepted accounting
principles) certain component elements, such as non-recurring charges, other real estate
expense and amortization of intangibles (deducted from non interest expense) and security
transactions and other non-recurring items (excluded from noninterest income). We follow
these practices.
Source: Provident New York Bancorp
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