DENVER, April 22 /PRNewswire-FirstCall/ -- CoBiz Financial Inc. , a financial services company with $2.4 billion in assets, announced a net loss of $4.7 million for the first quarter of 2010, as compared to a net loss of $46.9 million for the first quarter of 2009. The net loss available to common shareholders was $0.15 per diluted common share versus a net loss of $2.07 per diluted common share in the prior year quarter (the first quarter of 2009 results included a $33.7 million, goodwill impairment charge, or $1.40 per diluted share). For the fourth quarter of 2009, the Company reported a net loss of $4.5 million, or $0.15 per diluted common share.
Financial Performance - First Quarter 2010 -- The net loss available to common shareholders of $0.15 per diluted common share was a significant improvement from the net loss from core operations (excluding goodwill charges) of $0.67 per diluted common share in the first quarter of 2009 (see the accompanying reconciliation of Non-GAAP Measures to GAAP). The improvement was primarily driven by a decrease in provision for loan and credit losses (Provision). -- The first quarter marks the third consecutive decrease in quarterly Provision expense for the Company. Provision for the first quarter of 2010 decreased by $2.7 million, or 16%, from the fourth quarter of 2009 (linked-quarter) to $13.8 million from $16.5 million. The Provision for the first quarter of 2010 was 59% lower or $20.1 million less than the first quarter of 2009 Provision of $33.9 million. -- During the first quarter, the Company charged-off, net of recoveries, $17.0 million, as compared to $22.9 million in the fourth quarter of 2009. -- The allowance for loan and credit losses (Allowance) was 4.17% of total loans at March 31, 2010, and covered more than 101% of nonperforming loans (NPLs). -- Nonperforming assets decreased slightly during the first quarter to $100.0 million, or 4.13% of total assets, from $104.5 million or 4.24% of total assets at December 31, 2009. -- The net interest margin increased 16 basis points (0.16%) to 4.52% for the first quarter of 2010, from 4.36% in the fourth quarter of 2009. The net interest margin increased 14 basis points (0.14%) from 4.38% in the first quarter of 2009. -- Loans outstanding as of March 31, 2010, were $1.7 billion. Loan run-off decelerated during the quarter with a net decrease of $54.8 million from the fourth quarter of 2009. Total loans decreased by $97.3 million and $71.8 million in the fourth and third quarters of 2009, respectively. Loans were down $291.6 million, or 14.4%, from March 31, 2009. During the current quarter, new credit relationships of $37.1 million were added and $66.2 million was advanced on existing lines. -- Deposits and customer repurchase agreements (Customer Repos) decreased by $25.2 million on a linked-quarter basis. Deposits and Customer Repos excluding wholesale brokered sources (Customer Funding) decreased by $16.2 million on a linked-quarter basis. Year-over-year, Customer Funding increased by $390.2 million or 23.1%. -- Total noninterest-bearing demand accounts represented 27.5% of total deposits as of March 31, 2010, compared to 27.0% as of the prior year quarter.
"Overall, I am encouraged with our first quarter results," said Chairman and CEO Steve Bangert. "As expected, we continued to see a meaningful decrease in Provision expense, with Provision decreasing by 16% on a linked-quarter basis and 59% from the prior year. I was also pleased to see our asset quality continuing to stabilize, with nonperforming assets decreasing during the period.
"With confidence that our asset quality issues are under control, we are now increasing our efforts on building the franchise. We have several initiatives underway to grow the balance sheet and build profitable market share. Last year we announced the hiring of two new market presidents for our bank whose priority is to advance our business development efforts by implementing a consistent, bank-wide sales management program. We are also very close to introducing a jumbo mortgage product targeting professionals, owners and executives of the businesses we already serve. In addition, we are well underway with refining our wealth management offering - introducing broader investment choices and a more comprehensive financial planning approach.
"Although we benefited from lower credit costs in the first quarter, we did not see a pick-up in our earnings from the fourth quarter due to the expenses associated with these initiatives to grow the franchise. However, I am convinced that these are the right actions to position our company for a strong recovery along with the economy."
Loans
Total loans at March 31, 2010, were $1.73 billion, a decline of $54.8 million or 3.1% on a linked-quarter basis. We continue to diligently pursue new credit relationships at a time when the number of quality borrowers remains low and competition among banks to earn the business is high. Overall, the Company has seen a deceleration in net loan run-off over the last quarter. New credit relationships of $37.1 million were added during the quarter, a decline from the fourth quarter of 2009 when $63.9 million in new credit was extended. Advances on existing lines totaled $66.2 million during the current quarter, less than the $90.9 million drawn in the prior quarter. Reduced loan demand was offset in part by lower paydowns and maturities which slowed by $94.0 million on a linked-quarter basis to $158.1 million, the lowest level of paydown activity in the last five quarters.
Overall, Commercial and Industrial (C&I) loans comprised $566.3 million, or 32.8% of the total portfolio at March 31, 2010, compared to $559.6 million or 31.4% at December 31, 2009, and $630.6 million or 31.2% a year earlier. Commercial real estate accounted for 48.2% of total loans, with owner/occupied properties comprising a significant portion of this category. Our Land Acquisition and Development (A&D) loans totaled $122.7 million or 7.1% of the overall portfolio at March 31, 2010, compared to $152.7 million, or 8.6% at December 31, 2009 and $221.9 million, or 10.9%, at December 31, 2008. Over the past year management has focused on reducing the A&D portfolio by proactively working with its customers, taking aggressive steps in provisioning for and charging-off problem credits. As a result, the A&D portfolio was reduced by $107.1 million since March 31, 2009. Construction loans account for $116.7 million or 6.8% of the portfolio at March 31, 2010, compared to $144.5 million or 8.1% at December 31, 2009, and $171.2 million or 8.5% a year earlier.
Investment Securities
The Company had investment securities with a carrying value of $530.4 million at March 31, 2010, relatively unchanged from $529.5 million at December 31, 2009. The portfolio consists primarily of mortgage-backed securities (MBS), the overwhelming majority of which are backed by U.S. government agencies. These securities had an amortized cost of $361.6 million and a market value of $374.4 million at quarter end. The remaining MBS are non-agency, private-label securities with a net book value of $5.0 million and a market value of $2.4 million. At March 31, 2010, the Company had agency debentures with a book value of $72.1 million, an increase of $15.4 million compared to the prior linked-quarter. Investments also include $38.5 million of single-issuer trust preferred securities backed by 16 different financial institutions and $38.7 million of corporate debt securities issued primarily by six S&P 500 companies. All trust preferred securities in the Company's portfolio continue to pay dividends and were not deemed impaired at March 31, 2010. The fair value of the trust preferred and corporate debt securities was $79.4 million at March 31, 2010. The portfolio does not contain any collateralized debt obligations (CDOs) or securities backed by sub-prime mortgage loans.
The Company recognized a $0.2 million Other Than Temporary Impairment (OTTI) valuation loss during the first quarter of 2010. The valuation loss related to one private label MBS, which was previously deemed to have an OTTI.
Deposits and Customer Repo Balances
Deposit and Customer Repo balances ended the period at $2.1 billion, an increase of $277.8 million or 15.4% from the same period in 2009. On a linked-quarter basis, Deposit and Customer Repo balances decreased slightly by $25.2 million, or 1.2%. Customer Funding decreased by $16.2 million on a linked-quarter basis and grew by $390.2 million since the year earlier period, or 23.1%. The strong growth in core deposits is the result of a consistent, focused marketing effort by our business development officers, as well as our current customers maintaining more liquidity on their balance sheets. While loan growth continues to be a challenge, the bank is gaining market share by attracting and building depository relationships.
Total noninterest-bearing demand accounts represented 27.5% of total deposits as of March 31, 2010, and have been at or above 27.0% since the fourth quarter of 2008.
Weakened loan demand coupled with strong deposit generation has resulted in an improved liquidity position. As of March 31, 2010, total loans to Customer Funding was 83.0% compared to 119.4% at the year earlier period.
Allowance for Loan and Credit Losses and Credit Quality
Nonperforming assets (NPAs) decreased by $4.5 million during the quarter to $100.0 million at March 31, 2010. Total nonperforming loans decreased to $71.1 million as of March 31, 2010, from $79.2 million at December 31, 2009. NPLs to total loans decreased to 4.11% at the end of the current quarter, from 4.44% as of the end of the previous quarter. Other real estate owned acquired through foreclosure, and other foreclosed assets (OREO) increased $3.6 million to $29.0 million at quarter end.
Approximately 58.2% of NPAs are within the Colorado portfolio and 41.8% in Arizona. Construction and A&D loans continue to exhibit the greatest weakness with 8.2% and 20.4%, respectively, of total loans in their category on nonperforming status. There was improvement in the A&D portfolio as nonperforming loans dropped by $9.0 million on a linked-quarter basis from $34.0 million and nonperformers as a percent of the loan category fell by 1.9% (191 basis points) from 22.3%. Nonperforming C&I loans increased to $19.1 million or 3.4% of the category total from $13.2 million or 2.4% at December 31, 2009. Nonperforming Real Estate loans remain a manageable 2.0%, down from 2.3% of the category at the prior quarter end. Of the $29.0 million of OREO, $15.8 million, or 54.5%, was located in Colorado and $13.2 million, or 45.5%, was located in Arizona.
Provision for loan and credit loss for the quarter totaled $13.8 million, a decline of $20.1 million or 59.2% less than in the year-earlier period and $2.7 million, or 16.4%, less than the prior quarter. The Company charged-off (net of recoveries) $17.0 million in the first quarter of 2010 compared to $22.9 million prior quarter and $13.2 million during the year-earlier period. The Allowance decreased $3.2 million to $72.1 million at March 31, 2010, from $75.3 million at December 31, 2009. The Company's Allowance to total loans held for investment contracted slightly to 4.17% from 4.23% as of December 31, 2009. The Allowance was in excess of 101% of NPLs at March 31, 2010.
Shareholders' Equity and Regulatory Capital
As of March 31, 2010, total Shareholders' Equity was $224.5 million. The Company's total tangible shareholders' equity was $219.7 million. The tangible shareholders' equity to tangible assets ratio was 9.1% and the tangible common equity ratio was 6.5% at the end of the first quarter of 2010 (see the accompanying Reconciliation of Non-GAAP Measures to GAAP).
During the first quarter, the Company filed a universal shelf registration statement on Form S-3 with the Securities and Exchange Commission to register up to $100 million in securities. The Securities and Exchange Commission declared the registration statement effective on April 12, 2010. While the Company has no immediate plans to raise capital under the shelf registration statement, it provides the Company with the financial flexibility to do so at the appropriate time.
Net Interest Income and Margin
Net interest income on a tax equivalent basis for the first quarter of 2010 decreased by $1.8 million, or 6.9%, to $24.9 million from the same period in 2009. Net interest income on a tax equivalent basis for the fourth quarter of 2009 was $25.2 million. The first quarter 2010 net interest margin (NIM) of 4.52% expanded by 14 basis points and 16 basis points as compared to the first and fourth quarters of 2009, respectively.
Average earning assets decreased by $54.5 million on a linked-quarter basis as a result of a $73.3 million decrease in average net loans. Average investment securities increased $29.7 million on linked-quarter basis. Average customer funding decreased by $23.6 million on a linked-quarter basis but increased $337.4 million over the comparable quarter in 2009. Yields on average earning assets increased nominally by 5 basis points on a linked quarter basis and decreased 15 basis points from the first quarter of 2009. Rates paid on average interest-bearing liabilities decreased by 15 basis points on a linked-quarter basis and decreased by 18 basis points from the first quarter of 2009.
Noninterest Income
Noninterest income increased by $0.4 million on a linked-quarter basis to $6.9 million for the first quarter of 2010. Noninterest income was $6.1 million in the first quarter of 2009. As a percentage of total operating revenue, noninterest income increased to 21.8% for the first quarter of 2010 from 20.6% for the fourth quarter of 2009. Noninterest income as a percentage of total operating revenues was 18.7% for the first quarter of 2009.
The noninterest income linked-quarter increase of $0.4 million in the first quarter is attributable primarily to an increase of $0.6 million in insurance income and an increase of $0.1 million in investment banking income offset by a decrease of $0.4 million in other income. The increase in insurance income was primarily attributable to an increase in property and casualty income of $0.4 million and a $0.6 million increase in contingency income, offset by a decline of $0.4 million in insurance commissions on the placement of life insurance policies in wealth transfer cases. The decrease in other income is primarily attributable to a decline of $0.2 million in fees on the sale of customer swaps.
Operating Expenses
Noninterest expenses for the first quarter of 2010 increased to $26.3 million from $23.8 million for the fourth quarter of 2009. Noninterest expenses during the first quarter of 2009, including a $33.7 million noncash goodwill impairment charge, were $57.3 million.
Salaries and employee benefit expenses increased by $1.9 million on a linked-quarter basis to $14.9 million. Salaries and employee benefits during the first quarter of 2009 were $13.8 million. The linked-quarter increase in salaries and employee benefit expense is primarily attributable to increases in bonus expense and payroll taxes. Bonus expense varies based on the management's expectations of year-end payments. Bonus expense for the fourth quarter of 2009 was minimal due to the low level of bonus payments awarded in 2009. Payroll taxes increase in the first quarter of each year when tax limits reset. The increase in salaries and employee benefits over the comparable period in 2009 is primarily attributable to the Company's successful efforts in attracting a number of talented employees during the latter half of 2009 and management's expectations that the Company's financial performance will continue to improve during 2010. Overall, the Company's full-time equivalent employees increased to 545 at the end of the first quarter of 2010 from 537 a year earlier.
Other operating expenses increased by $0.6 million on a linked-quarter basis. Year-over-year, other operating expenses increased by $1.3 million. Contributing to the linked-quarter change were increases to legal expenses of $0.3 million and FDIC assessments of $0.3 million. Contributing to the year-over-year change were increases to FDIC assessments of $0.5 million and loan work out and OREO holding costs of $0.6 million.
The Company's efficiency ratio for the first quarter of 2010 was 77.75%, compared to 70.34% for the fourth quarter of 2009 and 67.09% for the first quarter of 2009. This increased trend is the result of higher loan workout costs and significant increases in FDIC insurance premiums, as well as the cost of recent hires and variable incentive expense.
Earnings Conference Call
In conjunction with this release, you are invited to listen to the Company's conference call on Friday, April 23, 2010, at 9:00 am MDT with Steve Bangert, CoBiz chairman and CEO. The call can be accessed via the Internet at http://www.videonewswire.com/event.asp?id=68080 or by telephone at 877.493.9121 (conference ID # 68685222).
Explanation of the Company's Use of Non-GAAP Financial Measures
This earnings release contains GAAP financial measures and non-GAAP financial measures where Management believes it to be helpful in understanding our results of operations. We believe these measures provide important supplemental information to investors. However, you should not rely on non-GAAP financial measures alone as measures of our performance.
About CoBiz Financial
CoBiz Financial Inc. (http://www.cobizfinancial.com/) is a $2.4 billion financial holding company headquartered in Denver. The Company operates Colorado Business Bank and Arizona Business Bank, full-service commercial banking institutions that offer a broad range of sophisticated banking services -- including credit, treasury management, investment and deposit products -- to a targeted customer base of professionals and small to mid-sized businesses. CoBiz also offers trust and fiduciary services through CoBiz Trust; property and casualty insurance brokerage, risk management consulting and employee benefits brokerage and consulting services through CoBiz Insurance; investment banking services through Green Manning & Bunch; the management of stock and bond portfolios for individuals and institutions through CoBiz Trust, Alexander Capital Management Group and Wagner Investment Management, Inc.; and executive benefits consulting and wealth transfer services through Financial Designs, Ltd.
Forward-looking Information
This release contains forward-looking statements that describe CoBiz's future plans, strategies and expectations. All forward-looking statements are based on assumptions and involve risks and uncertainties, many of which are beyond our control and which may cause our actual results, performance or achievements to differ materially from the results, performance or achievements contemplated by the forward-looking statements. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. They often include words such as "believe," "expect," "anticipate," "intend," "plan," "estimate" or words of similar meaning, or future or conditional verbs such as "would", "could" or "may." Forward-looking statements speak only as of the date they are made. Such risks and uncertainties include, among other things:
-- Risks and uncertainties described in our reports filed with the Securities and Exchange Commission, including our most recent 10-K. -- Competitive pressures among depository and other financial institutions nationally and in our market areas may increase significantly. -- Adverse changes in the economy or business conditions, either nationally or in our market areas, could increase credit-related losses and expenses and/or limit growth. -- Increases in defaults by borrowers and other delinquencies could result in increases in our provision for losses on loans and leases and related expenses. -- Our inability to manage growth effectively, including the successful expansion of our customer support, administrative infrastructure and internal management systems, could adversely affect our results of operations and prospects. -- Fluctuations in interest rates and market prices could reduce our net interest margin and asset valuations and increase our expenses. -- The consequences of continued bank acquisitions and mergers in our market areas, resulting in fewer but much larger and financially stronger competitors, could increase competition for financial services to our detriment. -- Our continued growth will depend in part on our ability to enter new markets successfully and capitalize on other growth opportunities. -- Changes in legislative or regulatory requirements applicable to us and our subsidiaries could increase costs, limit certain operations and adversely affect results of operations. -- Changes in tax requirements, including tax rate changes, new tax laws and revised tax law interpretations may increase our tax expense or adversely affect our customers' businesses.
In light of these risks, uncertainties and assumptions, you should not place undue reliance on any forward-looking statements in this release. We undertake no obligation to publicly update or otherwise revise any forward-looking statements, whether as a result of new information, future events or otherwise.
CoBiz Financial Inc. March 31, 2010 (unaudited) Three months ended March 31, ------------------------- (in thousands, except per share amounts) 2010 2009 ------------------------------- ---- ---- INCOME STATEMENT DATA Interest income $29,919 $33,534 Interest expense 5,166 6,955 ----- ----- NET INTEREST INCOME BEFORE PROVISION 24,753 26,579 Provision for loan losses 13,820 33,747 ------ ------ NET INTEREST INCOME (LOSS) AFTER PROVISION 10,933 (7,168) Noninterest income 6,885 6,121 Noninterest expense 26,273 23,631 Impairment of goodwill - 33,697 --- ------ LOSS BEFORE INCOME TAXES (8,455) (58,375) Benefit for income taxes (3,436) (10,928) ------ ------- NET LOSS (5,019) (47,447) Net loss attributable to noncontrolling interest 322 498 NET LOSS AFTER NONCONTROLLING INTEREST $(4,697) $(46,949) ======= ======== Preferred stock dividends (938) (930) NET LOSS ATTRIBUTABLE TO COMMON SHAREHOLDERS $(5,635) $(47,879) ======= ======== EARNINGS (LOSS) PER COMMON SHARE BASIC $(0.15) $(2.07) DILUTED $(0.15) $(2.07) WEIGHTED AVERAGE SHARES OUTSTANDING (in thousands) BASIC 36,476 23,174 DILUTED 36,476 23,174 EQUITY MEASURES Common Shares Outstanding at Period End (in thousands) 36,760 23,421 Book Value Per Common Share $4.42 $6.04 Tangible Book Value Per Common Share * $4.29 $5.28 Tangible Common Equity to Tangible Assets * 6.53% 4.75% Tangible Equity to Tangible Assets * 9.09% 7.11% * See accompanying Non-GAAP reconciliation. PERIOD END BALANCES Total Assets $2,421,040 $2,623,923 Loans 1,727,874 2,016,350 Loans Held For Sale - 3,100 Goodwill and Intangible Assets 4,749 17,878 Deposits 1,940,520 1,676,482 Subordinated Debentures 93,150 93,150 Common Shareholders' Equity 162,466 141,555 Total Shareholders' Equity 224,471 203,049 Interest-Earning Assets 2,224,511 2,441,130 Interest-Bearing Liabilities 1,646,056 1,945,511 BALANCE SHEET AVERAGES Average Assets $2,431,019 $2,658,588 Average Loans 1,754,384 2,025,349 Average Deposits 1,934,222 1,630,537 Average Subordinated Debentures 93,150 93,150 Average Shareholders' Equity 230,745 253,652 Average Interest-Earning Assets 2,234,775 2,475,708 Average Interest-Bearing Liabilities 1,651,471 1,947,119 CoBiz Financial Inc. March 31, 2010 (unaudited) Three months ended March 31, ------------------------- (in thousands) 2010 2009 -------------- ---- ---- PROFITABILITY MEASURES Net Interest Margin 4.52% 4.38% Efficiency Ratio 77.75% 67.09% Return on Average Assets (0.78)% (7.08)% Return on Average Shareholders' Equity (8.26)% (74.24)% Noninterest Income as a Percentage of Operating Revenues 21.76% 18.72% CREDIT QUALITY Nonperforming Loans Loans 90 days or more past due and accruing interest $2,054 $522 Nonaccrual loans 69,003 43,121 ------ ------ Total nonperforming loans 71,057 43,643 OREO & Repossessed Assets 28,951 8,879 ------ ----- Total nonperforming assets $100,008 $52,522 ======== ======= Charge-offs $(18,242) $(13,242) Recoveries 1,209 5 Net Charge-offs $(17,033) $(13,237) ======== ======== ASSET QUALITY MEASURES Nonperforming Assets to Total Assets 4.13% 2.00% Nonperforming Loans to Total Loans 4.11% 2.16% Nonperforming Loans and OREO to Total Loans and OREO 5.69% 2.59% Allowance for Loan and Credit Losses to Total Loans (excluding loans held for sale) 4.17% 3.16% Allowance for Loan and Credit Losses to Nonperforming Loans 101.41% 146.12% NONPERFORMING ASSETS BY MARKET Colorado Arizona ------------------------------ -------- ------- Commercial $14,701 $4,434 Real Estate - mortgage 6,509 9,950 Land Acquisition & Development 14,122 10,872 Real Estate - construction 6,600 2,931 Consumer 542 246 Other Loans - 150 Other Real Estate Owned 15,766 13,185 ------ ------ NPAs $58,240 $41,768 ======= ======= Total Loans $1,128,208 $599,666 Total Loans and OREO 1,143,974 612,851 Nonperforming Loans to Total Loans 3.76% 4.77% Nonperforming Loans and OREO to Total Loans and OREO 5.09% 6.82% CoBiz Financial Inc. March 31, 2010 (unaudited) Investment Commercial Investment Advisory (in thousands, except per share amounts) Banking Banking and Trust ------------------------------- ------- ------- --------- Net interest income Quarter ended March 31, 2010 $25,471 $1 $(9) Quarter ended December 31, 2009 25,670 1 (7) Annualized quarterly growth (3.1)% .0% (115.9)% Quarter ended March 31, 2009 $27,809 $3 $- Annual growth (8.4)% (66.7)% (100.0)% Noninterest income Quarter ended March 31, 2010 $2,396 $301 $1,369 Quarter ended December 31, 2009 2,542 175 1,362 Annualized quarterly growth (23.3)% 292.0% 2.1% Quarter ended March 31, 2009 $1,929 $104 $1,224 Annual growth 24.2% 189.4% 11.8% Net loss Quarter ended March 31, 2010 $(852) $(444) $(158) Quarter ended December 31, 2009 (1,512) (479) (200) Annualized quarterly growth 177.0% 29.6% 85.2% Quarter ended March 31, 2009 $(27,791) $(1,322) $(3,470) Annual growth 96.9% 66.4% 95.4% Earnings per share (diluted) Quarter ended March 31, 2010 $(0.02) $(0.01) $- Quarter ended December 31, 2009 (0.04) (0.01) (0.01) Annualized quarterly growth 202.8% .0% 405.6% Quarter ended March 31, 2009 $(1.20) $(0.06) $(0.15) Annual growth 98.3% 83.3% 100.0% Total loans At March 31, 2010 At December 31, 2009 Annualized quarterly growth At March 31, 2009 Annual growth Total deposits and customer repurchase agreements At March 31, 2010 At December 31, 2009 Annualized quarterly growth At March 31, 2009 Annual growth Corporate Support and (in thousands, except per share amounts) Insurance Other Consolidated ------------------------------- --------- ----- ------------ Net interest income Quarter ended March 31, 2010 $(3) $(707) $24,753 Quarter ended December 31, 2009 (3) (669) 24,992 Annualized quarterly growth .0% (23.0)% (3.9)% Quarter ended March 31, 2009 $(2) $(1,231) $26,579 Annual growth (50.0)% 42.6% (6.9)% Noninterest income Quarter ended March 31, 2010 $3,173 $(354) $6,885 Quarter ended December 31, 2009 2,580 (167) 6,492 Annualized quarterly growth 93.2% (454.1)% 24.6% Quarter ended March 31, 2009 $3,384 $(520) $6,121 Annual growth (6.2)% 31.9% 12.5% Net loss Quarter ended March 31, 2010 $(180) $(3,063) $(4,697) Quarter ended December 31, 2009 (213) (2,134) (4,538) Annualized quarterly growth 62.8% (176.6)% (14.2)% Quarter ended March 31, 2009 $(13,220) $(1,146) $(46,949) Annual growth 98.6% (167.3)% 90.0% Earnings per share (diluted) Quarter ended March 31, 2010 $- $(0.12) $(0.15) Quarter ended December 31, 2009 (0.01) (0.08) (0.15) Annualized quarterly growth 405.6% (202.8)% .0% Quarter ended March 31, 2009 $(0.57) $(0.09) $(2.07) Annual growth 100.0% (33.3)% 92.8% Total loans At March 31, 2010 $1,727,874 At December 31, 2009 1,782,686 Annualized quarterly growth (12.5)% At March 31, 2009 $2,019,450 Annual growth (14.4)% Total deposits and customer repurchase agreements At March 31, 2010 $2,083,464 At December 31, 2009 2,108,627 Annualized quarterly growth (4.8)% At March 31, 2009 $1,805,677 Annual growth 15.4% CoBiz Financial Inc. March 31, 2010 (unaudited) Three months ended ------------------ December September March 31, 31, 30, (in thousands) 2010 2009 2009 -------------- ---- ---- ---- COMMERCIAL BANKING ------------------ Income Statement Total interest income $29,556 $30,685 $31,901 Total interest expense 4,085 5,015 5,497 ----- ----- ----- Net interest income 25,471 25,670 26,404 Provision for loan losses 11,361 14,593 19,838 ------ ------ ------ Net interest income (loss) after provision 14,110 11,077 6,566 Noninterest income 2,396 2,542 2,311 Noninterest expense 8,779 7,837 8,231 Impairment of goodwill - - - --- --- --- Income (loss) before income taxes 7,727 5,782 646 Provision (benefit) for income taxes 2,503 1,513 14 ----- ----- --- Net income (loss) before management fees and overhead allocations $5,224 $4,269 $632 ------ ------ ---- Management fees and overhead allocations, net of tax 6,076 5,781 5,219 ----- ----- ----- Net income (loss) $(852) $(1,512) $(4,587) ===== ======= ======= INVESTMENT BANKING ------------------ Income Statement Total interest income $1 $1 $2 Total interest expense - - - --- --- --- Net interest income 1 1 2 Provision for loan losses - - - --- --- --- Net interest income (loss) after provision 1 1 2 Noninterest income 301 175 476 Noninterest expense 976 999 1,154 Impairment of goodwill - - 3,049 --- --- ----- Income (loss) before income taxes (674) (823) (3,725) Provision (benefit) for income taxes (271) (377) (1,347) ---- ---- ------ Net income (loss) before management fees and overhead allocations $(403) $(446) $(2,378) ----- ----- ------- Management fees and overhead allocations, net of tax 41 33 30 --- --- --- Net income (loss) $(444) $(479) $(2,408) ===== ===== ======= INVESTMENT ADVISORY AND TRUST ----------------------------- Income Statement Total interest income $- $- $- Total interest expense 9 7 6 --- --- --- Net interest income (9) (7) (6) Provision for loan losses - - - --- --- --- Net interest income (loss) after provision (9) (7) (6) Noninterest income 1,369 1,362 1,292 Noninterest expense 1,398 1,563 1,336 Impairment of goodwill - - 3,437 --- --- ----- Income (loss) before income taxes (38) (208) (3,487) Provision (benefit) for income taxes (15) (107) (794) --- ---- ---- Net income (loss) before management fees and overhead allocations $(23) $(101) $(2,693) ---- ----- ------- Management fees and overhead allocations, net of tax 135 99 87 --- --- --- Net income (loss) $(158) $(200) $(2,780) Three months ended ------------------ March June 30, 31, (in thousands) 2009 2009 -------------- ---- ---- COMMERCIAL BANKING ------------------ Income Statement Total interest income $32,820 $33,508 Total interest expense 5,490 5,699 ----- ----- Net interest income 27,330 27,809 Provision for loan losses 35,249 33,747 ------ ------ Net interest income (loss) after provision (7,919) (5,938) Noninterest income 2,773 1,929 Noninterest expense 10,323 8,142 Impairment of goodwill - 15,348 --- ------ Income (loss) before income taxes (15,469) (27,499) Provision (benefit) for income taxes (4,768) (4,813) ------ ------ Net income (loss) before management fees and overhead allocations $(10,701) $(22,686) -------- -------- Management fees and overhead allocations, net of tax 3,107 5,105 ----- ----- Net income (loss) $(13,808) $(27,791) ======== ======== INVESTMENT BANKING ------------------ Income Statement Total interest income $1 $3 Total interest expense - - --- --- Net interest income 1 3 Provision for loan losses - - --- --- Net interest income (loss) after provision 1 3 Noninterest income 399 104 Noninterest expense 955 916 Impairment of goodwill - 2,230 --- ----- Income (loss) before income taxes (555) (3,039) Provision (benefit) for income taxes (209) (1,755) ---- ------ Net income (loss) before management fees and overhead allocations $(346) $(1,284) ----- ------- Management fees and overhead allocations, net of tax 30 38 --- --- Net income (loss) $(376) $(1,322) ===== ======= INVESTMENT ADVISORY AND TRUST ----------------------------- Income Statement Total interest income $- $- Total interest expense 3 - --- --- Net interest income (3) - Provision for loan losses - - --- --- Net interest income (loss) after provision (3) - Noninterest income 1,308 1,224 Noninterest expense 1,698 1,655 Impairment of goodwill - 3,081 --- ----- Income (loss) before income taxes (393) (3,512) Provision (benefit) for income taxes (152) (153) ---- ---- Net income (loss) before management fees and overhead allocations $(241) $(3,359) ----- ------- Management fees and overhead allocations, net of tax 84 111 --- --- Net income (loss) $(325) $(3,470) CoBiz Financial Inc. March 31, 2010 (unaudited) Three months ended ------------------ December September March 31, 31, 30, (in thousands) 2010 2009 2009 ---- ---- ---- Total interest income $- $- $- Total interest expense 3 3 4 --- --- --- Net interest income (3) (3) (4) Provision for loan losses - - - --- --- --- Net interest income (loss) after provision (3) (3) (4) Noninterest income 3,173 2,580 3,019 Noninterest expense 3,255 2,748 2,961 Impairment of goodwill - - 5,977 --- --- ----- Income (loss) before income taxes (85) (171) (5,923) Provision (benefit) for income taxes (26) (58) (1,548) --- --- ------ Net income (loss) before management fees and overhead allocations $(59) $(113) $(4,375) ---- ----- ------- Management fees and overhead allocations, net of tax 121 100 90 --- --- --- Net income (loss) $(180) $(213) $(4,465) ===== ===== ======= CORPORATE SUPPORT AND OTHER --------------------------- Income Statement Total interest income $362 $287 $199 Total interest expense 1,069 956 1,008 ----- --- ----- Net interest income (707) (669) (809) Provision for loan losses 2,459 1,964 424 ----- ----- --- Net interest income (loss) after provision (3,166) (2,633) (1,233) Noninterest income (354) (167) (119) Noninterest expense 11,865 10,696 9,821 ------ ------ ----- Income (loss) before income taxes (15,385) (13,496) (11,173) Provision (benefit) for income taxes (5,627) (5,243) (4,244) ------ ------ ------ Net income (loss) before management fees and overhead allocations $(9,758) $(8,253) $(6,929) ------- ------- ------- Management fees and overhead allocations, net of tax (6,373) (6,013) (5,426) ------ ------ ------ Net income (loss) $(3,385) $(2,240) $(1,503) Net (income) loss attributable to noncontrolling interest 322 106 - --- --- --- Net income (loss) after noncontrolling interest $(3,063) $(2,134) $(1,503) ======= ======= ======= CONSOLIDATED ------------ Income Statement Total interest income $29,919 $30,973 $32,102 Total interest expense 5,166 5,981 6,515 ----- ----- ----- Net interest income 24,753 24,992 25,587 Provision for loan losses 13,820 16,557 20,262 ------ ------ ------ Net interest income (loss) after provision 10,933 8,435 5,325 Noninterest income 6,885 6,492 6,979 Noninterest expense 26,273 23,843 23,503 Impairment of goodwill - - 12,463 --- --- ------ Income (loss) before income taxes (8,455) (8,916) (23,662) Provision (benefit) for income taxes (3,436) (4,272) (7,919) ------ ------ ------ Net income (loss) before management fees and overhead allocations $(5,019) $(4,644) $(15,743) ------- ------- -------- Management fees and overhead allocations, net of tax - - - --- --- --- Net income (loss) $(5,019) $(4,644) $(15,743) Net (income) loss attributable to noncontrolling interest 322 106 - --- --- --- Net income (loss) after noncontrolling interest $(4,697) $(4,538) $(15,743) ======= ======= ======== Three months ended ------------------ March June 30, 31, (in thousands) 2009 2009 ---- ---- Total interest income $- $- Total interest expense 4 2 --- --- Net interest income (4) (2) Provision for loan losses - - --- --- Net interest income (loss) after provision (4) (2) Noninterest income 2,795 3,384 Noninterest expense 2,966 3,474 Impairment of goodwill - 13,038 --- ------ Income (loss) before income taxes (175) (13,130) Provision (benefit) for income taxes (63) (24) --- --- Net income (loss) before management fees and overhead allocations $(112) $(13,106) ----- -------- Management fees and overhead allocations, net of tax 90 114 --- --- Net income (loss) $(202) $(13,220) ===== ======== CORPORATE SUPPORT AND OTHER --------------------------- Income Statement Total interest income $20 $23 Total interest expense 1,118 1,254 ----- ----- Net interest income (1,098) (1,231) Provision for loan losses - - --- --- Net interest income (loss) after provision (1,098) (1,231) Noninterest income 760 (520) Noninterest expense 8,331 9,444 ----- ----- Income (loss) before income taxes (8,669) (11,195) Provision (benefit) for income taxes (4,548) (4,183) ------ ------ Net income (loss) before management fees and overhead allocations $(4,121) $(7,012) ------- ------- Management fees and overhead allocations, net of tax (3,311) (5,368) ------ ------ Net income (loss) $(810) $(1,644) Net (income) loss attributable to noncontrolling interest (290) 498 ---- --- Net income (loss) after noncontrolling interest $(1,100) $(1,146) ======= ======= CONSOLIDATED ------------ Income Statement Total interest income $32,841 $33,534 Total interest expense 6,615 6,955 ----- ----- Net interest income 26,226 26,579 Provision for loan losses 35,249 33,747 ------ ------ Net interest income (loss) after provision (9,023) (7,168) Noninterest income 8,035 6,121 Noninterest expense 24,273 23,631 Impairment of goodwill - 33,697 --- ------ Income (loss) before income taxes (25,261) (58,375) Provision (benefit) for income taxes (9,740) (10,928) ------ ------- Net income (loss) before management fees and overhead allocations $(15,521) $(47,447) -------- -------- Management fees and overhead allocations, net of tax - - --- --- Net income (loss) $(15,521) $(47,447) Net (income) loss attributable to noncontrolling interest (290) 498 ---- --- Net income (loss) after noncontrolling interest $(15,811) $(46,949) ======== ======== CoBiz Financial Inc. March 31, 2010 (unaudited) Three months ended ------------------ March 31, December 31, September 30, (in thousands, except per share amounts) 2010 2009 2009 ------------------------- ---- ---- ---- Interest income $29,919 $30,973 $32,102 Interest expense 5,166 5,981 6,515 ----- ----- ----- Net interest income before provision 24,753 24,992 25,587 Provision for loan losses 13,820 16,557 20,262 ------ ------ ------ Net interest income (loss) after provision 10,933 8,435 5,325 ------ ----- ----- Noninterest income: Deposit service charges $1,258 $1,212 $1,282 Investment advisory and trust income 1,369 1,362 1,292 Insurance income 3,173 2,580 3,019 Investment banking income 301 175 476 Other income 784 1,163 910 --- ----- --- Total noninterest income 6,885 6,492 6,979 ----- ----- ----- Noninterest expense: Salaries and employee benefits $14,947 $13,049 $13,350 Stock-based compensation expense 419 410 313 Occupancy expenses, premises and equipment 3,434 3,333 3,320 Amortization of intangibles 161 167 169 Other operating expenses 5,889 5,261 5,426 Impairment of goodwill - - 12,463 Net loss on securities, other assets and OREO 1,423 1,623 925 ----- ----- --- Total noninterest expense 26,273 23,843 35,966 ------ ------ ------ Net Loss before income taxes (8,455) (8,916) (23,662) Benefit for income taxes (3,436) (4,272) (7,919) ------ ------ ------ Net loss (5,019) (4,644) (15,743) Net (income) loss attributable to noncontrolling interest 322 106 - --- --- --- Net loss after noncontrolling interest $(4,697) $(4,538) $(15,743) ======= ======= ======== Preferred stock dividends (938) (936) (935) ---- ---- ---- Net loss available to common shareholders $(5,635) $(5,474) $(16,678) ======= ======= ======== Earnings (loss) per common share Basic $(0.15) $(0.15) $(0.50) Diluted $(0.15) $(0.15) $(0.50) ------ ------ ------ Weighted average shares outstanding (in thousands) Basic 36,476 36,440 33,581 ------ ------ ------ Diluted 36,476 36,440 33,581 ------ ------ ------ PROFITABILITY MEASURES Net Interest Margin 4.52% 4.36% 4.40% Efficiency Ratio 77.75% 70.34% 69.33% Return on Average Assets (0.78)% (0.73)% (2.48)% Return on Average Shareholders' Equity (8.26)% (7.67)% (25.11)% Noninterest Income as a Percentage of Operating Revenues 21.76% 20.62% 21.43% Three months ended ------------------ June 30, March 31, (in thousands, except per share amounts) 2009 2009 ------------------------------- ---- ---- Interest income $32,841 $33,534 Interest expense 6,615 6,955 ----- ----- Net interest income before provision 26,226 26,579 Provision for loan losses 35,249 33,747 ------ ------ Net interest income (loss) after provision (9,023) (7,168) ------ ------ Noninterest income: Deposit service charges $1,248 $1,177 Investment advisory and trust income 1,308 1,224 Insurance income 2,795 3,384 Investment banking income 399 104 Other income 2,285 232 ----- --- Total noninterest income 8,035 6,121 ----- ----- Noninterest expense: Salaries and employee benefits $13,081 $13,836 Stock-based compensation expense 411 409 Occupancy expenses, premises and equipment 3,288 3,274 Amortization of intangibles 169 169 Other operating expenses 5,632 4,584 Impairment of goodwill - 33,697 Net loss on securities, other assets and OREO 1,692 1,359 ----- ----- Total noninterest expense 24,273 57,328 ------ ------ Net Loss before income taxes (25,261) (58,375) Benefit for income taxes (9,740) (10,928) ------ ------- Net loss (15,521) (47,447) Net (income) loss attributable to noncontrolling interest (290) 498 ---- --- Net loss after noncontrolling interest $(15,811) $(46,949) ======== ======== Preferred stock dividends (932) (930) ---- ---- Net loss available to common shareholders $(16,743) $(47,879) ======== ======== Earnings (loss) per common share Basic $(0.72) $(2.07) Diluted $(0.72) $(2.07) ------ ------ Weighted average shares outstanding (in thousands) Basic 23,194 23,174 ------ ------ Diluted 23,194 23,174 ------ ------ PROFITABILITY MEASURES Net Interest Margin 4.38% 4.38% Efficiency Ratio 66.47% 67.09% Return on Average Assets (2.46)% (7.08)% Return on Average Shareholders' Equity (30.77)% (74.24)% Noninterest Income as a Percentage of Operating Revenues 23.45% 18.72% CoBiz Financial Inc. March 31, 2010 (unaudited) At --- March 31, December 31, September 30, (in thousands, except per share amounts) 2010 2009 2009 ------------------------- ---- ---- ---- PERIOD END BALANCES Total Assets $2,421,040 $2,466,015 $2,537,665 Loans 1,727,874 1,780,866 1,878,125 Loans Held for Sale - 1,820 1,844 Goodwill and Intangible Assets 4,749 4,910 5,078 Deposits 1,940,520 1,968,833 1,933,418 Subordinated Debentures 93,150 93,150 93,150 Common Shareholders' Equity 162,466 168,579 172,338 Total Shareholders' Equity 224,471 230,451 234,080 Interest-Earning Assets 2,224,511 2,270,381 2,355,281 Interest-Bearing Liabilities 1,646,056 1,659,248 1,728,059 LOANS Commercial $566,321 $559,612 $579,524 Real estate - mortgage 832,918 832,123 859,329 Land Acquisition & Development 122,657 152,667 178,949 Real estate - construction 116,725 144,455 165,923 Consumer 72,198 76,103 82,021 Other 17,055 15,906 12,379 ------ ------ ------ Gross loans 1,727,874 1,780,866 1,878,125 Less allowance for loan losses (71,903) (75,116) (81,499) ------- ------- ------- Net loans held for investment 1,655,971 1,705,750 1,796,626 Loans held for sale - 1,820 1,844 --- ----- ----- Total net loans $1,655,971 $1,707,570 $1,798,470 ========== ========== ========== DEPOSITS AND CUSTOMER REPURCHASE AGREEMENTS NOW and money market $720,202 $708,445 $583,877 Savings 10,780 10,552 9,952 Eurodollar 102,029 107,500 113,936 Certificates of deposits under $100,000 49,779 52,430 53,942 Certificates of deposits $100,000 and over 336,443 358,424 420,962 Reciprocal CDARS 186,900 178,382 191,211 Brokered deposits 1,397 10,332 35,367 ----- ------ ------ Total interest-bearing deposits 1,407,530 1,426,065 1,409,247 Noninterest-bearing demand deposits 532,990 542,768 524,171 Customer repurchase agreements 142,944 139,794 125,662 ------- ------- ------- Total deposits and customer repurchase agreements $2,083,464 $2,108,627 $2,059,080 ========== ========== ========== BALANCE SHEET AVERAGES Average Assets $2,431,019 $2,472,318 $2,518,393 Average Loans 1,754,384 1,836,782 1,920,384 Average Deposits 1,934,222 1,966,157 1,835,662 Average Subordinated Debentures 93,150 93,150 93,150 Average Shareholders' Equity 230,745 234,844 248,781 Average Interest-Earning Assets 2,234,775 2,289,621 2,322,410 Average Interest-Bearing Liabilities 1,651,471 1,679,788 1,741,117 CREDIT QUALITY Nonperforming Loans Loans 90 days or more past due and accruing interest $2,054 $509 $3,949 Nonaccrual loans 69,003 78,689 71,785 ------ ------ ------ Total nonperforming loans 71,057 79,198 75,734 OREO and Repossessed Assets 28,951 25,318 22,452 ------ ------ ------ Total nonperforming assets $100,008 $104,516 $98,186 ======== ======== ======= ASSET QUALITY MEASURES Nonperforming Assets to Total Assets 4.13% 4.24% 3.87% Nonperforming Loans to Total Loans 4.11% 4.44% 4.03% Nonperforming Loans and OREO to Total Loans and OREO 5.69% 5.78% 5.16% Allowance for Loan and Credit Losses to Total Loans (excluding loans held for sale) 4.17% 4.23% 4.35% Allowance for Loan and Credit Losses to Nonperforming Loans 101.41% 97.28% 107.86% EQUITY MEASURES Common shares outstanding at period end (in thousands) 36,760 36,724 36,694 ------ ------ ------ Book Value Per Common Share $4.42 $4.59 $4.70 Tangible Book Value Per Common Share * $4.29 $4.46 $4.56 Tangible Common Equity to Tangible Assets * 6.53% 6.65% 6.60% Tangible Equity to Tangible Assets * 9.09% 9.16% 9.04% Tier 1 Capital Ratio ** 13.81% 13.95% Total Risk Based Capital Ratio ** 16.13% 16.25% * See accompanying Non-GAAP reconciliation. ** Ratios unavailable at the time of release. At --- June 30, March 31, (in thousands, except per share amounts) 2009 2009 ------------------------------- ---- ---- PERIOD END BALANCES Total Assets $2,540,833 $2,623,923 Loans 1,949,590 2,016,350 Loans Held for Sale 2,185 3,100 Goodwill and Intangible Assets 17,708 17,878 Deposits 1,758,635 1,676,482 Subordinated Debentures 93,150 93,150 Common Shareholders' Equity 131,518 141,555 Total Shareholders' Equity 193,132 203,049 Interest-Earning Assets 2,344,099 2,441,130 Interest-Bearing Liabilities 1,848,425 1,945,511 LOANS Commercial $603,278 $630,567 Real estate - mortgage 892,488 890,037 Land Acquisition & Development 183,388 229,777 Real estate - construction 171,747 171,158 Consumer 85,385 83,157 Other 13,304 11,654 ------ ------ Gross loans 1,949,590 2,016,350 Less allowance for loan losses (75,256) (63,361) ------- ------- Net loans held for investment 1,874,334 1,952,989 Loans held for sale 2,185 3,100 ----- ----- Total net loans $1,876,519 $1,956,089 ========== ========== DEPOSITS AND CUSTOMER REPURCHASE AGREEMENTS NOW and money market $524,622 $520,605 Savings 9,432 9,560 Eurodollar 103,303 100,249 Certificates of deposits under $100,000 56,657 59,835 Certificates of deposits $100,000 and over 405,888 311,348 Reciprocal CDARS 117,408 108,961 Brokered deposits 65,972 113,800 ------ ------- Total interest-bearing deposits 1,283,282 1,224,358 Noninterest-bearing demand deposits 475,353 452,124 Customer repurchase agreements 118,958 129,195 ------- ------- Total deposits and customer repurchase agreements $1,877,593 $1,805,677 ========== ========== BALANCE SHEET AVERAGES Average Assets $2,580,448 $2,658,588 Average Loans 2,012,342 2,025,349 Average Deposits 1,719,953 1,630,537 Average Subordinated Debentures 93,150 93,150 Average Shareholders' Equity 206,127 253,669 Average Interest-Earning Assets 2,419,408 2,475,708 Average Interest-Bearing Liabilities 1,894,779 1,947,119 CREDIT QUALITY Nonperforming Loans Loans 90 days or more past due and accruing interest $35 $522 Nonaccrual loans 67,394 43,121 ------ ------ Total nonperforming loans 67,429 43,643 OREO and Repossessed Assets 26,461 8,879 ------ ----- Total nonperforming assets $93,890 $52,522 ======= ======= ASSET QUALITY MEASURES Nonperforming Assets to Total Assets 3.70% 2.00% Nonperforming Loans to Total Loans 3.45% 2.16% Nonperforming Loans and OREO to Total Loans and OREO 4.75% 2.59% Allowance for Loan and Credit Losses to Total Loans (excluding loans held for sale) 3.87% 3.16% Allowance for Loan and Credit Losses to Nonperforming Loans 111.99% 146.12% EQUITY MEASURES Common shares outstanding at period end (in thousands) 23,460 23,421 ------ ------ Book Value Per Common Share $5.61 $6.04 Tangible Book Value Per Common Share * $4.85 $5.28 Tangible Common Equity to Tangible Assets * 4.51% 4.75% Tangible Equity to Tangible Assets * 6.95% 7.11% Tier 1 Capital Ratio 10.78% 11.55% Total Risk Based Capital Ratio 13.44% 13.89% * See accompanying Non-GAAP reconciliation. ** Ratios unavailable at the time of release. CoBiz Financial Inc. March 31, 2010 (unaudited) Three months ended ------------------ March 31, 2010 -------------- Interest Average Average earned yield (in thousands) balance or paid or cost -------------- ------- ------- ------- Assets Federal funds sold and other $17,204 $19 0.44% Investment securities 537,517 5,933 4.42% Loans 1,754,384 24,138 5.50% Allowance for loan losses (74,330) ------- Total interest-earning assets $2,234,775 $30,090 5.20% Noninterest-earning assets Cash and due from banks 35,489 Other 160,755 ------- Total assets $2,431,019 ========== Liabilities and Shareholders' Equity Deposits NOW and money market $703,959 $1,330 0.77% Savings 10,406 10 0.39% Eurodollar 111,958 262 0.94% Certificates of deposit Brokered 5,616 30 2.17% Reciprocal 174,013 506 1.18% Under $100,000 51,204 214 1.69% $100,000 and over 345,324 1,358 1.59% ------- ----- Total interest-bearing deposits $1,402,480 $3,710 1.07% Other borrowings Securities sold under agreements to repurchase 132,258 291 0.88% Other short-term borrowings 23,583 16 0.27% Long term-debt 93,150 1,149 4.93% ------ ----- Total interest-bearing liabilities $1,651,471 $5,166 1.26% Noninterest-bearing demand accounts 531,742 ------- Total deposits and interest-bearing liabilities 2,183,213 Other noninterest-bearing liabilities 15,935 ------ Total liabilities 2,199,148 Total equity 231,871 ------- Total liabilities and equity $2,431,019 ========== Net interest income - taxable equivalent $24,924 ======= Net interest spread 3.94% Net interest margin 4.52% Ratio of average interest-earning assets to average interest-bearing liabilities 135.32% Three months ended ------------------ December 31, 2009 ----------------- Interest Average Average earned yield or (in thousands) balance or paid cost -------------- ------- ------- ----- Assets Federal funds sold and other $28,390 $31 0.43% Investment securities 507,858 5,947 4.68% Loans 1,836,782 25,178 5.36% Allowance for loan losses (83,409) ------- Total interest-earning assets $2,289,621 $31,156 5.15% Noninterest-earning assets Cash and due from banks 35,684 Other 147,013 ------- Total assets $2,472,318 ========== Liabilities and Shareholders' Equity Deposits NOW and money market $667,682 $1,498 0.89% Savings 9,916 12 0.48% Eurodollar 113,745 312 1.07% Certificates of deposit Brokered 17,265 87 2.00% Reciprocal 182,016 637 1.39% Under $100,000 53,715 258 1.91% $100,000 and over 386,874 1,852 1.90% ------- ----- Total interest-bearing deposits $1,431,213 $4,656 1.29% Other borrowings Securities sold under agreements to repurchase 135,529 330 0.95% Other short-term borrowings 19,896 19 0.37% Long term-debt 93,150 976 4.10% ------ --- Total interest-bearing liabilities $1,679,788 $5,981 1.41% Noninterest-bearing demand accounts 534,944 ------- Total deposits and interest-bearing liabilities 2,214,732 Other noninterest-bearing liabilities 21,509 ------ Total liabilities 2,236,241 Total equity 236,077 ------- Total liabilities and equity $2,472,318 ========== Net interest income - taxable equivalent $25,175 ======= Net interest spread 3.74% Net interest margin 4.36% Ratio of average interest-earning assets to average interest-bearing liabilities 136.30% Three months ended ------------------ March 31, 2009 -------------- Interest Average Average earned yield (in thousands) balance or paid or cost -------------- ------- ------- ------- Assets Federal funds sold and other $5,482 $27 1.97% Investment securities 489,608 6,351 5.19% Loans 2,025,349 27,344 5.40% Allowance for loan losses (44,731) ------- Total interest-earning assets $2,475,708 $33,722 5.35% Noninterest-earning assets Cash and due from banks 35,861 Other 147,019 ------- Total assets $2,658,588 ========== Liabilities and Shareholders' Equity Deposits NOW and money market $535,324 $1,540 1.17% Savings 10,260 12 0.47% Eurodollar 97,063 310 1.28% Certificates of deposit Brokered 30,846 69 0.91% Reciprocal 101,706 365 1.46% Under $100,000 70,045 532 3.08% $100,000 and over 345,406 2,109 2.48% ------- ----- Total interest-bearing deposits $1,190,650 $4,937 1.68% Other borrowings Securities sold under agreements to repurchase 123,820 272 0.88% Other short-term borrowings 539,499 506 0.38% Long term-debt 93,150 1,240 5.32% ------ ----- Total interest-bearing liabilities $1,947,119 $6,955 1.44% Noninterest-bearing demand accounts 439,887 ------- Total deposits and interest-bearing liabilities 2,387,006 Other noninterest-bearing liabilities 17,913 ------ Total liabilities 2,404,919 Total equity 253,669 ------- Total liabilities and equity $2,658,588 ========== Net interest income - taxable equivalent $26,767 ======= Net interest spread 3.91% Net interest margin 4.38% Ratio of average interest-earning assets to average interest-bearing liabilities 127.15% CoBiz Financial Inc. March 31, 2010 (unaudited) Reconciliation of Non-GAAP Measures to GAAP ------------------------------------------- (in thousands, except per share amounts) The Company believes these Non-GAAP measurements are useful to obtain an understanding of the operating results of the Company's core business and reflects the basis on which management internally reviews financial performance and capital adequacy. These Non-GAAP measurements are not a substitute for operating results determined in accordance with GAAP nor do they necessarily conform to Non-GAAP performance measures that may be presented by other companies. ------------------------------------------------------------------- The following table includes Non-GAAP financial measurements related to tangible equity, tangible common equity and tangible assets. These items have been adjusted to exclude goodwill, intangible assets and preferred stock. -------------------------------------------------------------------- March 31, December 31, September 30, 2010 2009 2009 ---------- ------------- -------------- Shareholders' equity as reported -GAAP $224,471 $230,451 $234,080 Goodwill and intangible assets (4,749) (4,910) (5,078) Tangible equity - Non- GAAP 219,722 225,541 229,002 Preferred stock (62,005) (61,872) (61,742) Tangible common equity - Non-GAAP $157,717 $163,669 $167,260 ======== ======== ======== Total assets as reported -GAAP $2,421,040 $2,466,015 $2,537,665 Goodwill and intangible assets (4,749) (4,910) (5,078) Total tangible assets - Non-GAAP $2,416,291 $2,461,105 $2,532,587 ========== ========== ========== Common shares outstanding 36,760 36,724 36,694 Tangible equity to tangible assets - Non- GAAP 9.09% 9.16% 9.04% Tangible common equity to tangible assets - Non-GAAP 6.53% 6.65% 6.60% Tangible book value per common share - Non- GAAP $4.29 $4.46 $4.56 June 30, March 31, 2009 2009 --------- ---------- Shareholders' equity as reported - GAAP $193,132 $203,049 Goodwill and intangible assets (17,708) (17,878) Tangible equity - Non-GAAP 175,424 185,171 Preferred stock (61,614) (61,494) Tangible common equity - Non-GAAP $113,810 $123,677 ======== ======== Total assets as reported - GAAP $2,540,833 $2,623,923 Goodwill and intangible assets (17,708) (17,878) Total tangible assets - Non-GAAP $2,523,125 $2,606,045 ========== ========== Common shares outstanding 23,460 23,421 Tangible equity to tangible assets - Non-GAAP 6.95% 7.11% Tangible common equity to tangible assets - Non-GAAP 4.51% 4.75% Tangible book value per common share - Non-GAAP $4.85 $5.28 The following table includes a Non-GAAP financial measurement related to diluted loss per common share and has been adjusted to exclude impairment on goodwill and intangible assets as well as the tax effect resulting from impairment charges. Three months ended March 31, 2009 ---------- Net loss attributable to common shareholders -GAAP $(47,879) Impairment of goodwill and intangible assets 33,817 Benefit for income taxes on impairment charge (1,495) Net loss - Non-GAAP $(15,557) ======== Diluted loss per common share - GAAP $(2.07) Impairment charge per diluted share 1.40 Diluted loss per common share - Non- GAAP $(0.67) ======
CoBiz Financial
CONTACT: Lyne Andrich of CoBiz Financial Inc., +1-303-312-3458
Web Site: http://www.cobizfinancial.com/
