Signature Bank (SBNY) Tops Q4 EPS by 8c

Signature Bank (NASDAQ: SBNY) reported Q4 EPS of $2.78, $0.08 better than the analyst estimate of $2.70.

• Net Income for the 2019 Fourth Quarter Was $148.2 Million, or $2.78 Diluted Earnings Per Share, Versus $160.8 Million, or $2.94 Diluted Earnings Per Share Reported in the 2018 Fourth Quarter
• Net Income for 2019 Was $588.9 Million, or $10.87 Diluted Earnings Per Share, Compared with $505.3 Million or $9.23 Diluted Earnings Per Share in 2018, an Increase of $83.6 Million, or 16.5 Percent
• The Bank Declared a Cash Dividend of $0.56 Per Share, Payable on or After February 14, 2020 to Common Stockholders of Record at the Close of Business on January 31, 2020
• During the 2019 Fourth Quarter, the Bank Repurchased 722,420 Shares of Common Stock For a Total of $89.4 Million. Thus Far, the Bank Repurchased 2,296,585 Shares of Common Stock For a Total of $279.1 Million From Its $500 Million Authorization
• Total Deposits in the 2019 Fourth Quarter Increased $1.33 Billion to $40.38 Billion, While Average Deposits Increased $1.41 Billion, or 3.6 Percent
• Total Deposits Grew $4.0 Billion, or 11.0 Percent, in 2019. Average Deposits for 2019 at $38.06 Billion, Representing an Increase of $2.91 Billion, or 8.3 Percent, Versus $35.14 Billion in 2018
• For the 2019 Fourth Quarter, Loans Increased $1.17 Billion to $39.11 Billion. Since Year-end 2018, Loans Increased $2.69 Billion, or 7.4 Percent. In Line with the Bank’s Strategy to Increase Floating Rate Assets and Reduce Its Commercial Real Estate Concentration, the Bank Decreased Commercial Real Estate Loans by $428.3 Million. Conversely, Commercial & Industrial Loans Grew by $1.66 Billion During the Quarter
• Non-Accrual Loans Were $57.4 Million, or 0.15 Percent of Total Loans, at December 31, 2019, Versus $32.5 Million, or 0.09 Percent of Total Loans, at the End of the 2019 Third Quarter. Non-Accrual Loans at Year-end 2018 were $108.6 Million, or 0.30 Percent of Total Loans
• Net Interest Margin on a Tax-Equivalent Basis Was 2.72 Percent for the 2019 Fourth Quarter, Compared with 2.68 Percent for the 2019 Third Quarter and 2.90 Percent for the 2018 Fourth Quarter. Core Net Interest Margin on a Tax-Equivalent Basis, Which Excludes Loan Prepayment Penalty Income, Increased One Basis Point to 2.67 Percent for the 2019 Fourth Quarter, Compared with 2.66 Percent for the 2019 Third Quarter
• Tier 1 Leverage, Common Equity Tier 1 Risk-Based, Tier 1 Risk-Based and Total Risk-Based Capital Ratios were 9.60 Percent, 11.62 Percent, 11.62 Percent and 13.32 Percent, Respectively, at December 31, 2019. Signature Bank Remains Significantly Above FDIC “Well-Capitalized” Standards. Tangible Common Equity Ratio was 9.34 Percent
• On November 1, 2019, the Bank Completed a Public Offering of $200.0 Million in Subordinated Debt
• For 2019, Four Private Client Banking Teams Joined Including the 28-person Venture Banking Group and the 15-member Specialized Mortgage Servicing Banking Team

“At Signature Bank, we have never been concerned about reaching and emphasizing milestones because each time we reach one, we are well aware there is always another waiting. Unlike sports, there’s never an offseason in banking. However, this quarter, the Bank reached a milestone worth recognizing – surpassing $50 billion in total assets. In less than 19 years, Signature Bank has grown from $50 million to $50 billion in total assets, purely organically; a feat we believe no other bank has accomplished. We appreciate the efforts put forth by all our colleagues and the loyalty of our clients to reach this important milestone,” noted Joseph J. DePaolo, President and Chief Executive Officer.

“2019 was a strong year for Signature Bank -- one where deposits increased $4.0 billion, loans rose $2.7 billion and earnings increased 17 percent. Additionally, we have laid the necessary groundwork for future growth with the launch of several new businesses and execution of certain key initiatives, including Signet™, our blockchain-based payments platform; the official opening of our full-service private client banking office in the heart of downtown San Francisco; the hiring of our Venture Banking Group; the on-boarding of the Specialized Mortgage Servicing Banking Team; and, further advancement of both our Digital Asset Banking Team and Fund Banking Division. We look forward to the positive impact these businesses will have on the Bank’s future operations as well as the ongoing contributions of our existing teams and colleagues,” DePaolo said.

Scott A. Shay, Chairman of the Board, said: “We take this opportunity to thank all of Signature Bank colleagues for their contributions to our reaching the $50 billion threshold in assets. We are gratified on several levels. First, since the Bank has grown without any acquisitions, every depositor made a conscious decision to bank with Signature Bank, based on our service levels and focus on their safety. We continue our depositor-centric focus, which will become even more critical at this later stage of the credit cycle.

“We are also very mindful of the transition away from LIBOR which will impact virtually every financial institution and large parts of other industries. We are preparing for the administrative tasks related to the demise of LIBOR and transition to another index such as SOFR or AMERIBORTM (AMBOR). We plan to recommend AMERIBOR to our clients and utilize AMERIBOR whenever our clients agree. As we enter 2020, we look forward to continuing to serve our clients to make their banking easier, their payments faster and their companies more profitable. As for Signature Bank, I believe the best is yet to come,” Shay concluded.

For earnings history and earnings-related data on Signature Bank (SBNY) click here.

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