VINELAND, N.J. Jan. 30, 2012 /PRNewswire/ -- Sun Bancorp, Inc. (Nasdaq: SNBC) reported today a net loss available to common shareholders of $1.5 million, or a loss of $0.02 per diluted share, for the fourth quarter ended December 31, 2011, compared to a net loss available to common shareholders of $28.2 million, or a loss of $0.67 per diluted share, for the fourth quarter ended December 31, 2010 which included a $25.1 million net loss on the sale of commercial real estate loans, and net income available to common shareholders of $2.7 million, or earnings of $0.03 per diluted share, for the third quarter ended September 30, 2011.
The following are key items and events that occurred during the fourth quarter:
- Non-performing loans decreased $27.5 million to $107.7 million at December 31, 2011 as compared to $135.9 million at September 30, 2011. Non-performing assets declined by $28.1 million from the linked quarter to $112.7 million at December 31, 2011.
- Net charge-offs equaled $20.4 million, of which $17.0 million were related to the charge-off of previously established specific reserves. Provision expense totaled $6.8 million and the allowance for loan losses equaled $41.7 million, a decrease of $13.6 million from the prior quarter.
- Average loans for the fourth quarter totaled $2.34 billion, up $19.3 million or 0.8%, compared to the prior quarter. Average deposits were down $9.8 million versus the prior quarter. The net interest margin equaled 3.54% versus 3.61% in the prior quarter.
- Non-interest income increased $1.0 million to $6.8 million primarily due to a bank-owned life insurance distribution of $765 thousand and gains of $280 thousand on the sale of investment securities.
- Tangible equity to assets equaled 8.41% as compared to 8.21% in the third quarter. Total Risk-based Capital equaled 15.22%.
"2011 was a year of commitment to our customers and the revitalization of our company. We rolled up our sleeves and achieved the goals we set out to: we added talent, strengthened the balance sheet, improved operating performance and grew commercial loan production year-over-year by 36%," said Thomas X. Geisel, Sun's President and Chief Executive Officer. "We ended the year with strong capital and reserves and are well positioned to continue our positive asset quality and operating trends. We look forward to executing our corporate strategy in 2012 to serve our customers, create earnings and grow from the platform we established."
For the full year ended December 31, 2011, the Company reported a net loss of $67.5 million, or $0.88 per diluted share, as compared to a net loss of $185.4 million, or $6.56 per diluted share, in 2010. Provision for loan losses totaled $74.3 million in 2011 versus $101.5 million in 2010. Non-interest expense equaled $110.2 million in 2011 versus $201.1 million in the prior year. Non-interest expense in 2010 included a goodwill impairment charge of $89.7 million. Total assets at December 31, 2011 equaled $3.18 billion as compared to $3.42 billion at December 31, 2010.
Discussion of Results:
Balance Sheet
- Total assets were $3.18 billion at December 31, 2011, as compared to $3.24 billion at September 30, 2011 and $3.42 billion at December 31, 2010.
- Gross loans held-for-investment were $2.29 billion at December 31, 2011, as compared to $2.31 billion at September 30, 2011 and $2.52 billion at December 31, 2010. Compared to the linked quarter, loans held-for-investment decreased by $15.3 million as the Company recorded net charge-offs of $20.4 million in the fourth quarter.
- Loans held-for-sale increased $2.3 million from the linked quarter to $23.2 million at December 31, 2011.
- Shareholders' equity increased $1.0 million to $309.1 million at December 31, 2011 as compared to the linked quarter.
Net Interest Income and Margin
- On a tax equivalent basis, net interest income decreased $473 thousand over the linked quarter to $26.0 million. The average cost of interest-bearing liabilities decreased three basis points to 0.89%. The average yield on interest-earning assets decreased 10 basis points over the linked quarter from 4.33% to 4.23%. The net interest margin declined seven basis points to 3.54% from 3.61% for the linked quarter. The margin increased 17 basis points from 3.37% for the comparable prior year quarter.
Non-Interest Income
- Non-interest income was $6.8 million for the quarter ended December 31, 2011, an increase of $1.0 million over the linked quarter of $5.8 million and $993 thousand million below the comparable prior year quarter income of $7.8 million. The increase over the linked quarter was primarily attributable to a bank-owned life insurance distribution of $765 thousand and gains on the sale of investment securities of $280 thousand.
Non-Interest Expense
- The Company incurred $27.2 million of non-interest expense in the fourth quarter of 2011, an increase of $253 thousand over the linked quarter and a decrease of $723 thousand from the comparable prior year quarter. Higher problem loan and occupancy expenses were partially offset by lower personnel and legal expenses.
Asset Quality
- The provision for loan losses for the fourth quarter was $6.8 million, as compared to $2.3 million in the linked quarter and $35.5 million in the comparable prior year quarter. The allowance for loan losses was $41.7 million at December 31, 2011, or 1.82% of gross loans held-for-investment, as compared to the allowance for loan losses to gross loans held-for-investment of 2.39% at September 30, 2011 and 3.24% at December 31, 2010. Net charge-offs recorded in the current quarter were $20.4 million, or 0.87% of average loans, as compared to $5.8 million, or 0.25% of average loans for the linked quarter and $28.4 million, or 1.05% of average loans outstanding for the comparable prior year quarter. The prior year quarter included charge-offs of $21.7 million related to the sale of commercial real estate loans.
- Total non-performing assets were $112.7 million, or 4.86% of total gross loans held-for-investment, loans held-for-sale and real estate owned at December 31, 2011, as compared to $140.8 million, or 6.04% and $177.7 million, or 7.00%, respectively, at September 30, 2011 and December 31, 2010. Non-performing loans decreased $27.5 million over the linked quarter to $107.7 million at December 31, 2011 from $135.2 million at September 30, 2011.
Capital
- Stockholders' equity totaled $309.1 million at December 31, 2011 compared to $308.1 million at September 30, 2011. The Company's tangible equity to tangible assets ratio was 8.41% at December 31, 2011, as compared to 8.21% at September 30, 2011 and 6.51% at December 31, 2010. At December 31, 2011, the Company's total risk-based capital ratio, Tier 1 capital ratio and leverage capital ratio were approximately 15.22%, 13.96%, and 11.09%, respectively. At December 31, 2011, Sun National Bank's total risk-based capital ratio, Tier 1 capital ratio and leverage capital ratio were approximately 13.39%, 12.13%, and 9.64%, respectively.
The Company will hold its regularly scheduled conference call on Tuesday, January 31, 2012, at 11:00 a.m. (ET). Participants may listen to the live web cast through the Sun Bancorp, Inc. web site at www.sunnb.com. Participants are advised to log on 10 minutes ahead of the scheduled start of the call. An Internet-based replay will be available at the Web site for two weeks following the call.
Sun Bancorp, Inc. (Nasdaq: SNBC) is a $3.18 billion asset bank holding company headquartered in Vineland, New Jersey, with its executive offices located in Mt. Laurel, New Jersey. Its primary subsidiary is Sun National Bank, a full service Commercial Bank serving customers through 65 locations in New Jersey. Sun National Bank has been named one of Forbes Magazine's "Most Trustworthy Companies" for five years running. The Bank is an Equal Housing Lender and its deposits are insured up to the legal maximum by the Federal Deposit Insurance Corporation (FDIC). For more information about Sun National Bank and Sun Bancorp, Inc., visit www.sunnb.com.
The foregoing material contains forward-looking statements concerning the financial condition, results of operations and business of the Company. We caution that such statements are subject to a number of uncertainties and actual results could differ materially, and, therefore, readers should not place undue reliance on any forward-looking statements. The Company does not undertake, and specifically disclaims, any obligation to publicly release the results of any revisions that may be made to any forward-looking statements to reflect the occurrence of anticipated or unanticipated events or circumstances after the date of such statements.
Non-GAAP Financial Measures
This release references tax-equivalent interest income and non-operating income and expenses. Tax-equivalent interest income is a non-GAAP financial measure. Tax-equivalent interest income assumes a 35% marginal federal tax rate for all periods. The fully taxable equivalent adjustments for the three months ended December 31, 2011 and 2010 were $271 thousand and $382 thousand, respectively. The fully taxable equivalent adjustments for the twelve months ended December 31, 2011 and 2010 were $1.3 million and $1.8 million, respectively. The fully taxable equivalent adjustment for the three months ended September 30, 2011 was $292 thousand. Non-operating income (loss) is also a non-GAAP financial measure. Non-operating income (loss) includes impairment losses recognized on available for sale securities included in earnings. Non-operating loss for the three months ended March 31, 2011 and December 31, 2010 was $250 thousand and $379 thousand, respectively. There were no non-operating income items during the three months ended December 31, 2011, September 30, 2011 or June 30, 2011.
SUN BANCORP, INC. AND SUBSIDIARIES | |||||||||||||||||||||||
FINANCIAL HIGHLIGHTS (Unaudited) | |||||||||||||||||||||||
(Dollars in thousands, except per share amounts) | |||||||||||||||||||||||
For the Three Months Ended | For the Twelve Months Ended | ||||||||||||||||||||||
December 31, | December 31, | ||||||||||||||||||||||
2011 | 2010 | 2011 | 2010 | ||||||||||||||||||||
Profitability for the period: | |||||||||||||||||||||||
Net interest income | $ | 25,729 | $ | 27,273 | $ | 103,528 | $ | 110,962 | |||||||||||||||
Provision for loan losses | 6,826 | 35,511 | 74,266 | 101,518 | |||||||||||||||||||
Non-interest income (loss) | 6,804 | 7,797 | 13,468 | 15,512 | |||||||||||||||||||
Non-interest expense | 27,226 | 27,949 | 110,225 | 201,052 | |||||||||||||||||||
Loss before income taxes | (1,519) | (28,390) | (67,495) | (176,096) | |||||||||||||||||||
Net loss | (1,519) | (28,493) | (67,505) | (185,418) | |||||||||||||||||||
Net loss available to common shareholders | $ | (1,519) | $ | (28,219) | $ | (67,505) | $ | (185,418) | |||||||||||||||
Financial ratios: | |||||||||||||||||||||||
Return on average assets(1) | (0.19) | % | (3.14) | % | (2.05) | % | (5.19) | % | |||||||||||||||
Return on average equity(1) | (1.96) | % | (37.88) | % | (22.57) | % | (56.82) | % | |||||||||||||||
Return on average tangible equity(1),(2) | (2.29) | % | (45.43) | % | (26.77) | % | (80.23) | % | |||||||||||||||
Net interest margin(1) | 3.54 | % | 3.37 | % | 3.50 | % | 3.50 | % | |||||||||||||||
Efficiency ratio | 83.69 | % | 78.67 | % | 94.21 | % | 158.68 | % | |||||||||||||||
Efficiency ratio, excluding non-operating income and non-operating expense(3) | 83.69 | % | 77.83 | % | 94.01 | % | 86.84 | % | |||||||||||||||
Loss per common share: | |||||||||||||||||||||||
Basic | $ | (0.02) | $ | (0.67) | $ | (0.88) | $ | (6.56) | |||||||||||||||
Diluted | $ | (0.02) | $ | (0.67) | $ | (0.88) | $ | (6.56) | |||||||||||||||
Average equity to average assets | 9.62 | % | 8.29 | % | 9.10 | % | 9.13 | % | |||||||||||||||
December 31, | |||||||||||||||||||||||
2011 | 2010 | ||||||||||||||||||||||
At period-end: | |||||||||||||||||||||||
Total assets | $ | 3,183,916 | $ | 3,417,546 | |||||||||||||||||||
Total deposits | 2,667,977 | 2,940,460 | |||||||||||||||||||||
Loans receivable, net of allowance for loan losses | 2,249,455 | 2,439,633 | |||||||||||||||||||||
Loans held-for-sale | 23,192 | 13,824 | |||||||||||||||||||||
Investments | 532,715 | 493,493 | |||||||||||||||||||||
Borrowings | 31,269 | 33,417 | |||||||||||||||||||||
Junior subordinated debentures | 92,786 | 92,786 | |||||||||||||||||||||
Shareholders' equity | 309,083 | 268,242 | |||||||||||||||||||||
Credit quality and capital ratios: | |||||||||||||||||||||||
Allowance for loan losses to gross loans held-for-investment | 1.82 | % | 3.24 | % | |||||||||||||||||||
Non-performing assets to gross loans held-for-investment, loans held-for-sale and real estate owned | 4.86 | % | 7.00 | % | |||||||||||||||||||
Allowance for loan losses to non-performing loans held-for-investment | 38.69 | % | 47.02 | % | |||||||||||||||||||
Total capital (to risk-weighted assets): | |||||||||||||||||||||||
Sun Bancorp, Inc. | 15.22 | % | 12.68 | % | |||||||||||||||||||
Sun National Bank | 13.39 | % | 12.25 | % | |||||||||||||||||||
Tier 1 capital (to risk-weighted assets): | |||||||||||||||||||||||
Sun Bancorp, Inc. | 13.96 | % | 11.41 | % | |||||||||||||||||||
Sun National Bank | 12.13 | % | 10.98 | % | |||||||||||||||||||
Leverage ratio: | |||||||||||||||||||||||
Sun Bancorp, Inc. | 11.09 | % | 8.93 | % | |||||||||||||||||||
Sun National Bank | 9.64 | % | 8.57 | % | |||||||||||||||||||
Book value per common share | $ | 3.61 | $ | 5.33 | |||||||||||||||||||
Tangible book value per common share | $ | 3.08 | $ | 4.36 | |||||||||||||||||||
(1) Amounts for the three and twelve months ended are annualized. | |||||||||||||||||||||||
(2) Return on average tangible equity is computed by dividing annualized net income for the period by average tangible equity. Average tangible equity equals average equity less average identifiable intangible assets and goodwill. | |||||||||||||||||||||||
(3) Efficiency ratio, excluding non-operating income and non-operating expense, is computed by dividing non-interest expense for the period by the summation of net interest income and non-interest income. Non-interest income for the twelve months ended December 31, 2011 excludes net impairment losses on available for sale securities of $250 thousand. Non-interest income for the three and twelve months ended December 31, 2010 exclude a net impairment loss on available for sale securities of $379 thousand and $1.3 million, respectively. Non-interest expense for the twelve months ended December 31, 2010 excludes a goodwill impairment charge of $89.7 million. | |||||||||||||||||||||||
SUN BANCORP, INC. AND SUBSIDIARIES | |||||||
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION (Unaudited) | |||||||
(Dollars in thousands, except par value amounts) | |||||||
December 31, 2011 | December 31, 2010 | ||||||
ASSETS | |||||||
Cash and due from banks | $ | 68,773 | $ | 36,522 | |||
Interest-earning bank balances | 51,049 | 150,704 | |||||
Cash and cash equivalents | 119,822 | 187,226 | |||||
Investment securities available for sale (amortized cost of $514,488 and $483,255 at December 31, 2011 and December 31, 2010, respectively) | 515,545 | 472,864 | |||||
Investment securities held to maturity (estimated fair value of $1,413 and $3,155 at December 31, 2011 and December 31, 2010, respectively) | 1,344 | 3,039 | |||||
Loans receivable (net of allowance for loan losses of $41,667 and $81,713 at December 31, 2011 and December 31, 2010, respectively) | 2,249,455 | 2,439,633 | |||||
Loans held-for-sale | 23,192 | 13,824 | |||||
Restricted equity investments | 15,826 | 17,590 | |||||
Bank properties and equipment, net | 54,756 | 53,428 | |||||
Real estate owned | 5,020 | 3,913 | |||||
Accrued interest receivable | 8,912 | 10,004 | |||||
Goodwill | 38,188 | 38,188 | |||||
Intangible assets | 6,947 | 10,631 | |||||
Deferred taxes, net | - | 4,245 | |||||
Bank owned life insurance (BOLI) | 74,871 | 74,656 | |||||
Other assets | 70,038 | 88,305 | |||||
Total assets | $ | 3,183,916 | $ | 3,417,546 | |||
LIABILITIES AND SHAREHOLDERS' EQUITY | |||||||
Liabilities: | |||||||
Deposits | $ | 2,667,977 | $ | 2,940,460 | |||
Securities sold under agreements to repurchase - customers | 5,668 | 6,307 | |||||
Advances from the Federal Home Loan Bank of New York (FHLBNY) | 2,733 | 3,999 | |||||
Securities sold under agreements to repurchase - FHLBNY | 15,000 | 15,000 | |||||
Obligations under capital lease | 7,868 | 8,111 | |||||
Junior subordinated debentures | 92,786 | 92,786 | |||||
Deferred taxes, net | 432 | - | |||||
Other liabilities | 82,369 | 82,641 | |||||
Total liabilities | 2,874,833 | 3,149,304 | |||||
Shareholders' equity: | |||||||
Preferred stock, $1 par value, 1,000,000 shares authorized; none issued | - | - | |||||
Common stock, $1 par value, 200,000,000 shares authorized; 87,818,503 shares issued and 85,711,780 shares outstanding at December 31, 2011; 52,463,594 shares issued and 50,356,871 shares outstanding at December 31, 2010 | 87,825 | 52,464 | |||||
Additional paid-in capital | 504,508 | 438,335 | |||||
Retained deficit | (257,520) | (190,015) | |||||
Accumulated other comprehensive income (loss) | 625 | (6,146) | |||||
Deferred compensation plan trust | (193) | (234) | |||||
Treasury stock at cost,2,106,723 shares atDecember 31, 2011 and December 31, 2010 | (26,162) | (26,162) | |||||
Total shareholders' equity | 309,083 | 268,242 | |||||
Total liabilities and shareholders' equity | $ | 3,183,916 | $ | 3,417,546 | |||
SUN BANCORP, INC. AND SUBSIDIARIES | |||||||||||||||||
CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) | |||||||||||||||||
(Dollars in thousands, except per share amounts) | |||||||||||||||||
For the Three Months | For the Twelve Months | ||||||||||||||||
2011 | 2010 | 2011 | 2010 | ||||||||||||||
INTEREST INCOME | |||||||||||||||||
Interest and fees on loans | $ | 27,678 | $ | 31,415 | $ | 112,793 | $ | 129,391 | |||||||||
Interest on taxable investment securities | 2,421 | 2,991 | 10,507 | 11,993 | |||||||||||||
Interest on non-taxable investment securities | 503 | 710 | 2,487 | 3,344 | |||||||||||||
Dividends on restricted equity investments | 214 | 238 | 893 | 875 | |||||||||||||
Total interest income | 30,816 | 35,354 | 126,680 | 145,603 | |||||||||||||
INTEREST EXPENSE | |||||||||||||||||
Interest on deposits | 4,041 | 6,657 | 18,737 | 28,780 | |||||||||||||
Interest on funds borrowed | 351 | 392 | 1,418 | 1,744 | |||||||||||||
Interest on junior subordinated debentures | 695 | 1,032 | 2,997 | 4,117 | |||||||||||||
Total interest expense | 5,087 | 8,081 | 23,152 | 34,641 | |||||||||||||
Net interest income | 25,729 | 27,273 | 103,528 | 110,962 | |||||||||||||
PROVISION FOR LOAN LOSSES | 6,826 | 35,511 | 74,266 | 101,518 | |||||||||||||
Net Interest income (loss) after provision for loan losses | 18,903 | (8,238) | 29,262 | 9,444 | |||||||||||||
NON-INTEREST INCOME | |||||||||||||||||
Service charges on deposit accounts | 2,799 | 2,715 | 10,889 | 11,572 | |||||||||||||
Other service charges | 71 | 94 | 330 | 364 | |||||||||||||
Gain on sale of loans | 906 | 1,324 | 3,247 | 3,560 | |||||||||||||
Impairment losses on available for sale securities | - | (379) | (250) | (1,329) | |||||||||||||
Gain on sale of AFS Securities | 280 | 4,607 | 1,688 | 4,751 | |||||||||||||
Investment products income | 453 | 726 | 2,913 | 2,831 | |||||||||||||
BOLI income | 1,309 | 452 | 2,964 | 2,074 | |||||||||||||
Derivative credit valuation adjustment | (214) | (2,705) | (12,538) | (12,214) | |||||||||||||
Other | 1,200 | 963 | 4,225 | 3,903 | |||||||||||||
Total non-interest income (loss) | 6,804 | 7,797 | 13,468 | 15,512 | |||||||||||||
NON-INTEREST EXPENSE | |||||||||||||||||
Salaries and employee benefits | 13,011 | 12,920 | 52,501 | 55,219 | |||||||||||||
Occupancy expense | 3,643 | 3,043 | 13,373 | 12,508 | |||||||||||||
Equipment expense | 1,858 | 1,634 | 7,342 | 6,783 | |||||||||||||
Amortization of intangible assets | 921 | 921 | 3,685 | 3,685 | |||||||||||||
Goodwill impairment | - | - | - | 89,706 | |||||||||||||
Data processing expense | 1,118 | 1,133 | 4,352 | 4,359 | |||||||||||||
Professional fees | 412 | 1,220 | 3,271 | 2,724 | |||||||||||||
Insurance expense | 1,433 | 2,064 | 6,186 | 7,696 | |||||||||||||
Advertising expense | 664 | 390 | 2,946 | 2,335 | |||||||||||||
Problem loan costs | 1,866 | 1,923 | 8,342 | 5,162 | |||||||||||||
Real estate owned expense, net | 108 | 398 | 1,186 | 801 | |||||||||||||
Office supplies expense | 323 | 338 | 1,307 | 1,501 | |||||||||||||
Other expense | 1,869 | 1,965 | 5,734 | 8,573 | |||||||||||||
Total non-interest expense | 27,226 | 27,949 | 110,225 | 201,052 | |||||||||||||
LOSS BEFORE INCOME TAXES | (1,519) | (28,390) | (67,495) | (176,096) | |||||||||||||
INCOME TAX EXPENSE | - | 103 | 10 | 9,322 | |||||||||||||
NET LOSS | (1,519) | (28,493) | (67,505) | (185,418) | |||||||||||||
Preferred stock dividends and discount accretion | - | (274) | - | - | |||||||||||||
NET LOSS AVAILABLE TO COMMON SHAREHOLDERS | $ | (1,519) | $ | (28,219) | $ | (67,505) | $ | (185,418) | |||||||||
Basic loss per share | $ | (0.02) | $ | (0.67) | $ | (0.88) | $ | (6.56) | |||||||||
Diluted loss per share | $ | (0.02) | $ | (0.67) | $ | (0.88) | $ | (6.56) | |||||||||
Weighted average shares - basic | 85,587,878 | 42,119,553 | 76,653,990 | 28,258,953 | |||||||||||||
Weighted average shares - diluted | 85,587,878 | 42,119,553 | 76,653,990 | 28,258,953 | |||||||||||||
SUN BANCORP, INC. AND SUBSIDIARIES | ||||||||||||||||
HISTORICAL TRENDS IN QUARTERLY FINANCIAL DATA(Unaudited) | ||||||||||||||||
(Dollars in thousands) | ||||||||||||||||
2011 | 2011 | 2011 | 2011 | 2010 | ||||||||||||
Q4 | Q3 | Q2 | Q1 | Q4 | ||||||||||||
Balance sheet at quarter end: | ||||||||||||||||
Cash and cash equivalents | $ | 119,822 | 134,209 | $ | 192,645 | $ | 266,504 | $ | 187,226 | |||||||
Investment securities | 532,715 | 557,380 | 478,814 | 470,546 | 493,493 | |||||||||||
Loans held-for-investment: | ||||||||||||||||
Commercial and industrial | 1,878,026 | 1,899,231 | 1,905,628 | 1,862,903 | 2,103,492 | |||||||||||
Home equity | 224,517 | 230,098 | 234,688 | 232,318 | 239,729 | |||||||||||
Second mortgage | 41,470 | 45,030 | 47,920 | 50,388 | 53,912 | |||||||||||
Residential real estate | 100,438 | 82,967 | 75,546 | 69,311 | 65,250 | |||||||||||
Other | 46,671 | 49,077 | 52,825 | 55,402 | 58,963 | |||||||||||
Total gross loans held-for-investment | 2,291,122 | 2,306,403 | 2,316,607 | 2,270,322 | 2,521,346 | |||||||||||
Allowance for loan losses | (41,667) | (55,227) | (58,328) | (58,498) | (81,713) | |||||||||||
Net loans held-for-investment | 2,249,455 | 2,251,176 | 2,258,279 | 2,211,824 | 2,439,633 | |||||||||||
Loans held-for-sale | 23,192 | 20,868 | 20,514 | 115,473 | 13,824 | |||||||||||
Goodwill | 38,188 | 38,188 | 38,188 | 38,188 | 38,188 | |||||||||||
Intangible assets | 6,947 | 7,868 | 8,789 | 9,710 | 10,631 | |||||||||||
Total assets | 3,183,916 | 3,236,219 | 3,213,790 | 3,333,808 | 3,417,546 | |||||||||||
Total deposits | 2,667,977 | 2,727,650 | 2,723,676 | 2,847,467 | 2,940,460 | |||||||||||
Securities sold under agreements to repurchase- customers | 5,668 | 6,026 | 6,743 | 6,591 | 6,307 | |||||||||||
Advances from FHLBNY | 2,733 | 3,054 | 3,372 | 3,687 | 3,999 | |||||||||||
Securities sold under agreements to repurchase- FHLBNY | 15,000 | 15,000 | 15,000 | 15,000 | 15,000 | |||||||||||
Obligations under capital lease | 7,868 | 7,930 | 7,991 | 8,051 | 8,111 | |||||||||||
Junior subordinated debentures | 92,786 | 92,786 | 92,786 | 92,786 | 92,786 | |||||||||||
Total shareholders' equity | 309,083 | 308,055 | 298,819 | 286,739 | 268,242 | |||||||||||
Quarterly average balance sheet: | ||||||||||||||||
Loans(1): | ||||||||||||||||
Commercial and industrial | $ | 1,910,635 | $ | 1,901,394 | $ | 1,936,621 | 2,072,519 | $ | 2,184,212 | |||||||
Home equity | 226,345 | 232,458 | 234,451 | 235,962 | 241,510 | |||||||||||
Second mortgage | 44,600 | 47,844 | 50,257 | 53,402 | 57,310 | |||||||||||
Residential real estate | 111,514 | 89,010 | 76,816 | 73,662 | 88,144 | |||||||||||
Other | 46,248 | 49,361 | 52,831 | 55,847 | 57,522 | |||||||||||
Total gross loans | 2,339,342 | 2,320,067 | 2,350,976 | 2,491,392 | 2,628,698 | |||||||||||
Securities and other interest-earning assets | 602,485 | 616,679 | 643,808 | 639,092 | 658,013 | |||||||||||
Total interest-earning assets | 2,941,827 | 2,936,746 | 2,994,784 | 3,130,484 | 3,286,711 | |||||||||||
Total assets | 3,229,699 | 3,234,551 | 3,287,485 | 3,394,139 | 3,582,647 | |||||||||||
Non-interest-bearing demand deposits | 536,558 | 528,505 | 491,235 | 481,605 | 509,093 | |||||||||||
Total deposits | 2,706,772 | 2,716,542 | 2,774,767 | 2,904,448 | 3,032,594 | |||||||||||
Total interest-bearing liabilities | 2,294,786 | 2,313,896 | 2,409,629 | 2,549,566 | 2,657,984 | |||||||||||
Total shareholders' equity | 310,786 | 308,025 | 299,427 | 277,808 | 297,118 | |||||||||||
Capital and credit quality measures: | ||||||||||||||||
Total capital (to risk-weighted assets): | ||||||||||||||||
Sun Bancorp, Inc. | 15.22% | 14.85 | % | 14.51 | % | 13.73 | % | 12.68 | % | |||||||
Sun National Bank | 13.39% | 13.07 | % | 12.97 | % | 12.65 | % | 12.25 | % | |||||||
Tier 1 capital (to risk-weighted assets): | ||||||||||||||||
Sun Bancorp, Inc. | 13.96% | 13.59 | % | 13.14 | % | 12.11 | % | 11.41 | % | |||||||
Sun National Bank | 12.13% | 11.81 | % | 11.71 | % | 11.38 | % | 10.98 | % | |||||||
Leverage ratio: | ||||||||||||||||
Sun Bancorp, Inc. | 11.09% | 11.08 | % | 10.47 | % | 9.62 | % | 8.93 | % | |||||||
Sun National Bank | 9.64% | 9.64 | % | 9.35 | % | 9.05 | % | 8.57 | % | |||||||
Average equity to average assets | 9.62% | 9.52 | % | 9.11 | % | 8.18 | % | 8.29 | % | |||||||
Allowance for loan losses to total gross loans held-for-investment | 1.82% | 2.39 | % | 2.52 | % | 2.58 | % | 3.24 | % | |||||||
Non-performing assets to gross loans held-for-investment, loans held-for-sale and real estate owned | 4.86% | 6.04 | % | 6.13 | % | 8.04 | % | 7.00 | % | |||||||
Allowance for loan losses to non-performing loans held-for-investment | 38.69% | 42.23 | % | 45.25 | % | 50.41 | % | 47.02 | % | |||||||
Other data: | ||||||||||||||||
Net charge-offs | (20,386) | (5,809) | (5,006) | (83,498) | (28,377) | |||||||||||
Non-performing assets: | ||||||||||||||||
Non-accrual loans | $ | 89,656 | $ | 107,665 | $ | 113,806 | $ | 113,959 | $ | 159,426 | ||||||
Non-accrual loans held-for-sale | - | 5,186 | 11,296 | 71,771 | - | |||||||||||
Troubled debt restructurings, non-accrual | 17,875 | 22,353 | 15,090 | 831 | 11,796 | |||||||||||
Loans past due 90 days and accruing | 154 | 744 | - | 1,263 | 2,554 | |||||||||||
Real estate owned, net | 5,020 | 4,893 | 3,306 | 4,439 | 3,913 | |||||||||||
Total non-performing assets | 112,705 | 140,841 | 143,498 | 192,263 | 177,689 | |||||||||||
Troubled debt restructuring, performing | - | - | - | 20,276 | 20,341 | |||||||||||
(1) Average balances include non-accrual loans and loans held-for-sale | ||||||||||||||||
SUN BANCORP, INC. AND SUBSIDIARIES | |||||||||||||||||
HISTORICAL TRENDS IN QUARTERLY FINANCIAL DATA(Unaudited) | |||||||||||||||||
(Dollars in thousands, except share and per share amounts) | |||||||||||||||||
2011 | 2011 | 2011 | 2011 | 2010 | |||||||||||||
Q4 | Q3 | Q2 | Q1 | Q4 | |||||||||||||
Profitability for the quarter: | |||||||||||||||||
Tax-equivalent interest income | $ | 31,087 | $ | 31,802 | $ | 32,673 | $ | 32,458 | $ | 35,736 | |||||||
Interest expense | 5,087 | 5,329 | 5,813 | 6,923 | 8,081 | ||||||||||||
Tax-equivalent net interest income | 26,000 | 26,473 | 26,860 | 25,535 | 27,655 | ||||||||||||
Tax-equivalent adjustment | 271 | 292 | 368 | 409 | 382 | ||||||||||||
Provision for loan losses | 6,826 | 2,321 | 4,836 | 60,283 | 35,511 | ||||||||||||
Non-interest income (loss) excluding net impairment losses on available for sale securities | 6,804 | 5,770 | 4,993 | (3,849) | 8,176 | ||||||||||||
Net impairment losses on available for sale securities | - | - | - | (250) | (379) | ||||||||||||
Non-interest expense excluding amortization of intangible assets | 26,305 | 26,051 | 27,323 | 26,861 | 27,028 | ||||||||||||
Amortization of intangible assets | 921 | 922 | 921 | 921 | 921 | ||||||||||||
(Loss) income before income taxes | (1,519) | 2,657 | (1,595) | (67,038) | (28,390) | ||||||||||||
Income tax (benefit) expense | - | (23) | 4 | 29 | 103 | ||||||||||||
Net (loss) income | (1,519) | 2,680 | (1,599) | (67,067) | (28,493) | ||||||||||||
Net (loss) income available to common shareholders | $ | (1,519) | $ | 2,680 | $ | (1,599) | $ | (67,067) | $ | (28,219) | |||||||
Financial ratios: | |||||||||||||||||
Return on average assets (1) | (0.19)% | 0.33 | % | (0.19) | % | (7.90) | % | (3.18) | % | ||||||||
Return on average equity (1) | (1.96)% | 3.48 | % | (2.14) | % | (96.57) | % | (38.36) | % | ||||||||
Return on average tangible equity (1),(2) | (2.29)% | 4.10 | % | (2.54) | % | (116.91) | % | (46.01) | % | ||||||||
Net interest margin (1) | 3.54% | 3.61 | % | 3.59 | % | 3.26 | % | 3.37 | % | ||||||||
Efficiency ratio | 83.69% | 84.42 | % | 89.71 | % | 132.13 | % | 79.69 | % | ||||||||
Efficiency ratio, excluding non-operating income and non-operating expense | 83.69% | 84.42 | % | 89.71 | % | 130.57 | % | 78.84 | % | ||||||||
Per share data: | |||||||||||||||||
Income (loss) per common share: | |||||||||||||||||
Basic | $ | (0.02) | $ | 0.03 | $ | (0.02) | $ | (1.25) | $ | (0.67) | |||||||
Diluted | $ | (0.02) | $ | 0.03 | $ | (0.02) | $ | (1.25) | $ | (0.67) | |||||||
Book value | $ | 3.61 | $ | 3.60 | $ | 3.60 | $ | 3.62 | $ | 5.33 | |||||||
Tangible book value | $ | 3.08 | $ | 3.06 | $ | 3.03 | $ | 3.02 | $ | 4.36 | |||||||
Average basic shares | 85,587,878 | 84,429,644 | 82,585,859 | 53,575,346 | 42,119,553 | ||||||||||||
Average diluted shares | 85,587,878 | 84,538,449 | 82,585,859 | 53,575,346 | 42,119,553 | ||||||||||||
Operating non-interest income (loss): | |||||||||||||||||
Service charges on deposit accounts | $ | 2,799 | 2,838 | $ | 2,702 | $ | 2,550 | $ | 2,715 | ||||||||
Other service charges | 71 | 85 | 88 | 86 | 94 | ||||||||||||
Gain on sale of loans | 906 | 708 | 708 | 925 | 1,324 | ||||||||||||
Net gain (loss) on sale of available for sale securities | 280 | - | 2,421 | (1,013) | 4,606 | ||||||||||||
Investment products income | 453 | 562 | 1,010 | 888 | 728 | ||||||||||||
BOLI income | 1,309 | 549 | 560 | 546 | 452 | ||||||||||||
Derivative credit valuation adjustment | (214) | (309) | (3,624) | (8,391) | (2,705) | ||||||||||||
Other income | 1,200 | 1,337 | 1,128 | 560 | 962 | ||||||||||||
Total operating non-interest income (loss) | 6,804 | 5,770 | 4,993 | (3,849) | 8,176 | ||||||||||||
Non-operating loss(3): | |||||||||||||||||
Net impairment losses on available for sale securities recognized in earnings | - | - | - | (250) | (379) | ||||||||||||
Total non-operating loss | - | - | (250) | (379) | |||||||||||||
Total non-interest income (loss) | $ | 6,804 | 5,770 | $ | 4,993 | $ | (4,099) | $ | 7,797 | ||||||||
Operating non-interest expense: | |||||||||||||||||
Salaries and employee benefits | $ | 13,011 | $ | 13,619 | $ | 12,885 | $ | 12,986 | $ | 12,920 | |||||||
Occupancy expense | 3,643 | 3,021 | 3,305 | 3,404 | 3,043 | ||||||||||||
Equipment expense | 1,858 | 1,899 | 1,903 | 1,682 | 1,634 | ||||||||||||
Data processing expense | 1,118 | 1,058 | 1,111 | 1,065 | 1,133 | ||||||||||||
Amortization of intangible assets | 921 | 922 | 921 | 921 | 921 | ||||||||||||
Insurance expense | 1,433 | 1,479 | 1,261 | 2,013 | 2,064 | ||||||||||||
Professional fees | 412 | 879 | 1,215 | 765 | 1,220 | ||||||||||||
Advertising expense | 664 | 395 | 1,322 | 565 | 390 | ||||||||||||
Problem loan costs | 1,866 | 1,506 | 1,863 | 3,107 | 1,923 | ||||||||||||
Real estate owned expense (income), net | 108 | 448 | 635 | (5) | 398 | ||||||||||||
Office supplies expense | 323 | 315 | 324 | 345 | 338 | ||||||||||||
Other expense | 1,869 | 1,432 | 1,499 | 934 | 1,965 | ||||||||||||
Total non-interest expense | 27,226 | 26,973 | 28,244 | 27,782 | 27,949 | ||||||||||||
(1) Amounts are annualized. | |||||||||||||||||
(2) Return on average tangible equity is computed by dividing annualized net income for the period by average tangible equity. Average tangible equity equals average equity less average identifiable intangible assets and goodwill. | |||||||||||||||||
(3) Amount consists of items which the Company believes are not a result of normal operations. | |||||||||||||||||
SUN BANCORP, INC. AND SUBSIDIARIES | ||||||||||||||||||||||||
AVERAGE BALANCE SHEETS(Unaudited) | ||||||||||||||||||||||||
(Dollars in thousands) | ||||||||||||||||||||||||
For the Three Months Ended December 31, | ||||||||||||||||||||||||
2011 | 2010 | |||||||||||||||||||||||
Average | Income/ | Yield/ | Average | Income/ | Yield/ | |||||||||||||||||||
Balance | Expense | Cost | Balance | Expense | Cost | |||||||||||||||||||
Interest-earning assets: | ||||||||||||||||||||||||
Loans receivable (1),(2): | ||||||||||||||||||||||||
Commercial and industrial | $ | 1,910,635 | $ | 22,542 | 4.72 | % | $ | 2,184,212 | 25,654 | 4.70 | % | |||||||||||||
Home equity | 226,345 | 2,348 | 4.15 | 241,510 | 2,744 | 4.54 | ||||||||||||||||||
Second mortgage | 44,600 | 656 | 5.88 | 57,310 | 869 | 6.07 | ||||||||||||||||||
Residential real estate | 111,514 | 1,338 | 4.80 | 88,144 | 1,179 | 5.35 | ||||||||||||||||||
Other | 46,248 | 794 | 6.87 | 57,522 | 969 | 6.74 | ||||||||||||||||||
Total loans receivable | 2,339,342 | 27,678 | 4.73 | 2,628,698 | 31,415 | 4.78 | ||||||||||||||||||
Investment securities(3) | 548,355 | 3,375 | 2.46 | 491,588 | 4,216 | 3.43 | ||||||||||||||||||
Interest-earning bank balances | 54,130 | 34 | 0.25 | 166,425 | 105 | 0.25 | ||||||||||||||||||
Total interest-earning assets | 2,941,827 | 31,087 | 4.23 | 3,286,711 | 35,736 | 4.35 | ||||||||||||||||||
Non-interest earning assets: | ||||||||||||||||||||||||
Cash and due from banks | 73,863 | 47,492 | ||||||||||||||||||||||
Bank properties and equipment, net | 55,264 | 53,018 | ||||||||||||||||||||||
Goodwill and intangible assets, net | 45,586 | 49,402 | ||||||||||||||||||||||
Other assets | 113,159 | 146,024 | ||||||||||||||||||||||
Total non-interest-earning assets | 287,872 | 295,936 | ||||||||||||||||||||||
Total assets | $ | 3,229,699 | $ | 3,582,647 | ||||||||||||||||||||
Interest-bearing liabilities: | ||||||||||||||||||||||||
Interest-bearing deposit accounts: | ||||||||||||||||||||||||
Interest-bearing demand deposits | $ | 1,271,991 | 1,435 | 0.45 | % | 1,387,423 | 2,581 | 0.74 | % | |||||||||||||||
Savings deposits | 265,115 | 285 | 0.43 | 281,401 | 510 | 0.72 | ||||||||||||||||||
Time deposits | 633,108 | 2,321 | 1.47 | 854,677 | 3,566 | 1.67 | ||||||||||||||||||
Total interest-bearing deposit accounts | 2,170,214 | 4,041 | 0.74 | 2,523,501 | 6,657 | 1.06 | ||||||||||||||||||
Short-term borrowings: | ||||||||||||||||||||||||
Federal funds purchased | 141 | - | - | - | - | - | ||||||||||||||||||
Securities sold under agreements to repurchase- customers | 5,906 | 1 | 0.07 | 14,457 | 8 | 0.22 | ||||||||||||||||||
Long-term borrowings: | ||||||||||||||||||||||||
FHLBNY advances (4) | 17,842 | 219 | 4.91 | 19,102 | 246 | 5.15 | ||||||||||||||||||
Obligation under capital lease | 7,897 | 131 | 6.64 | 8,138 | 138 | 6.78 | ||||||||||||||||||
Junior subordinated debentures | 92,786 | 695 | 3.00 | 92,786 | 1,032 | 4.45 | ||||||||||||||||||
Total borrowings | 124,572 | 1,046 | 3.36 | 134,483 | 1,424 | 4.24 | ||||||||||||||||||
Total interest-bearing liabilities | 2,294,786 | 5,087 | 0.89 | 2,657,984 | 8,081 | 1.22 | ||||||||||||||||||
Non-interest bearing liabilities: | ||||||||||||||||||||||||
Non-interest-bearing demand deposits | 536,558 | 509,093 | ||||||||||||||||||||||
Other liabilities | 87,569 | 118,452 | ||||||||||||||||||||||
Total non-interest bearing liabilities | 624,127 | 627,545 | ||||||||||||||||||||||
Total liabilities | 2,918,913 | 3,285,529 | ||||||||||||||||||||||
Shareholders' equity | 310,786 | 297,118 | ||||||||||||||||||||||
Total liabilities and shareholders' equity | $ | 3,229,699 | $ | 3,582,647 | ||||||||||||||||||||
Net interest income | $ | 26,000 | $ | 27,655 | ||||||||||||||||||||
Interest rate spread (5) | 3.34 | % | 3.13 | % | ||||||||||||||||||||
Net interest margin (6) | 3.54 | % | 3.37 | % | ||||||||||||||||||||
Ratio of average interest-earning assets to average interest-bearing liabilities | 128.20 | % | 123.65 | % | ||||||||||||||||||||
(1) Average balances include non-accrual loans and loans held-for-sale. | ||||||||||||||||||||||||
(2) Loan fees are included in interest income and the amount is not material for this analysis. | ||||||||||||||||||||||||
(3) Interest earned on non-taxable investment securities is shown on a tax-equivalent basis assuming a 35% marginal federal tax rate for all periods. The fully taxable equivalent adjustments for the three months ended December 31, 2011 and 2010 were $271 thousand and $382 thousand, respectively. | ||||||||||||||||||||||||
(4) Amounts include Advances from FHLBNY and Securities sold under agreements to repurchase- FHLBNY. | ||||||||||||||||||||||||
(5) Interest rate spread represents the difference between the average yield on interest-earning assets and the average cost of interest-bearing liabilities. | ||||||||||||||||||||||||
(6) Net interest margin represents net interest income as a percentage of average interest-earning assets. | ||||||||||||||||||||||||
SUN BANCORP, INC. AND SUBSIDIARIES | ||||||||||||||||||||
AVERAGE BALANCE SHEETS(Unaudited) | ||||||||||||||||||||
(Dollars in thousands) | ||||||||||||||||||||
For the Twelve Months Ended December 31, | ||||||||||||||||||||
2011 | 2010 | |||||||||||||||||||
Average | Income/ | Yield/ | Average | Income/ | Yield/ | |||||||||||||||
Balance | Expense | Cost | Balance | Expense | Cost | |||||||||||||||
Interest-earning assets: | ||||||||||||||||||||
Loans receivable (1),(2): | ||||||||||||||||||||
Commercial and industrial | $ | 1,954,701 | 92,107 | 4.71 | % | $ | 2,245,118 | $ | 105,210 | 4.69 | % | |||||||||
Home equity | 232,278 | 9,774 | 4.21 | 251,599 | 11,714 | 4.66 | ||||||||||||||
Second mortgage | 48,998 | 2,863 | 5.84 | 62,349 | 3,889 | 6.24 | ||||||||||||||
Residential real estate | 87,858 | 4,547 | 5.18 | 79,547 | 4,415 | 5.55 | ||||||||||||||
Other | 51,041 | 3,502 | 6.86 | 60,874 | 4,163 | 6.84 | ||||||||||||||
Total loans receivable | 2,374,876 | 112,793 | 4.75 | 2,699,487 | 129,391 | 4.79 | ||||||||||||||
Investment securities (3) | 505,006 | 14,940 | 2.96 | 452,365 | 17,846 | 3.95 | ||||||||||||||
Interest-earning bank balances | 117,830 | 288 | 0.24 | 69,803 | 166 | 0.24 | ||||||||||||||
Total interest-earning assets | 2,997,712 | 128,021 | 4.27 | 3,221,655 | 147,403 | 4.58 | ||||||||||||||
Non-interest earning assets: | ||||||||||||||||||||
Cash and due from banks | 72,455 | 47,393 | ||||||||||||||||||
Bank properties and equipment, net | 54,589 | 52,944 | ||||||||||||||||||
Goodwill and intangible assets, net | 46,961 | 95,010 | ||||||||||||||||||
Other assets | 114,158 | 150,558 | ||||||||||||||||||
Total non-interest-earning assets | 288,163 | 345,905 | ||||||||||||||||||
Total assets | $ | 3,285,875 | $ | 3,567,560 | ||||||||||||||||
Interest-bearing liabilities: | ||||||||||||||||||||
Interest-bearing deposit accounts: | ||||||||||||||||||||
Interest-bearing demand deposits | $ | 1,317,816 | $ | 7,024 | 0.53 | % | $ | 1,312,871 | $ | 10,692 | 0.81 | % | ||||||||
Savings deposits | 271,970 | 1,412 | 0.52 | 295,121 | 2,283 | 0.77 | ||||||||||||||
Time deposits | 675,464 | 10,301 | 1.53 | 899,038 | 15,805 | 1.76 | ||||||||||||||
Total interest-bearing deposit accounts | 2,265,250 | 18,737 | 0.83 | 2,507,030 | 28,780 | 1.15 | ||||||||||||||
Short-term borrowings: | ||||||||||||||||||||
Federal funds purchased | 36 | - | - | 16,907 | 89 | 0.53 | ||||||||||||||
Securities sold under agreements to repurchase- customers | 6,681 | 7 | 0.10 | 16,069 | 30 | 0.18 | ||||||||||||||
Long-term borrowings: | ||||||||||||||||||||
FHLBNY advances (4) | 18,316 | 884 | 4.83 | 22,710 | 1,076 | 4.74 | ||||||||||||||
Obligations under capital lease | 7,988 | 527 | 6.60 | 8.212 | 550 | 6.70 | ||||||||||||||
Junior subordinated debentures | 92,786 | 2,997 | 3.23 | 92,786 | 4,117 | 4.44 | ||||||||||||||
Total borrowings | 125,807 | 4,415 | 3.51 | 156,684 | 5,861 | 3.74 | ||||||||||||||
Total interest-bearing liabilities | 2,391,057 | 23,152 | 0.97 | 2,663,714 | 34,641 | 1.30 | ||||||||||||||
Non-interest bearing liabilities: | ||||||||||||||||||||
Non-interest-bearing demand deposits | 509,678 | 481,757 | ||||||||||||||||||
Other liabilities | 86,013 | 96,420 | ||||||||||||||||||
Total non-interest bearing liabilities | 595,691 | 578,177 | ||||||||||||||||||
Total liabilities | 2,986,748 | 3,241,891 | ||||||||||||||||||
Shareholders' equity | 299,127 | 325,669 | ||||||||||||||||||
Total liabilities and shareholders' equity | $ | 3,285,875 | $ | 3,567,560 | ||||||||||||||||
Net interest income | $ | 104,869 | 112,762 | |||||||||||||||||
Interest rate spread (5) | 3.30 | % | 3.28 | % | ||||||||||||||||
Net interest margin (6) | 3.50 | % | 3.50 | % | ||||||||||||||||
Ratio of average interest-earning assets to average interest-bearing liabilities | 125.37 | % | 120.95 | % | ||||||||||||||||
(1) Average balances include non-accrual loans and loans held-for-sale. | ||||||||||||||||||||
(2) Loan fees are included in interest income and the amount is not material for this analysis. | ||||||||||||||||||||
(3) Interest earned on non-taxable investment securities is shown on a tax-equivalent basis assuming a 35% marginal federal tax rate for all periods. The fully taxable equivalent adjustments for the twelve months ended December 31, 2011 and 2010 were $1.3 million and $1.8 million, respectively. | ||||||||||||||||||||
(4) Amounts include Advances from FHLBNY and Securities sold under agreements to repurchase- FHLBNY. | ||||||||||||||||||||
(5) Interest rate spread represents the difference between the average yield on interest-earning assets and the average cost of interest-bearing liabilities. | ||||||||||||||||||||
(6) Net interest margin represents net interest income as a percentage of average interest-earning assets. | ||||||||||||||||||||
SUN BANCORP, INC. AND SUBSIDIARIES | ||||||||||||||||||||||||
AVERAGE BALANCE SHEETS(Unaudited) | ||||||||||||||||||||||||
(Dollars in thousands) | ||||||||||||||||||||||||
For the Three Months Ended | ||||||||||||||||||||||||
December 31, 2011 | September 30, 2011 | |||||||||||||||||||||||
Average | Income/ | Yield/ | Average | Income/ | Yield/ | |||||||||||||||||||
Balance | Expense | Cost | Balance | Expense | Cost | |||||||||||||||||||
Interest-earning assets: | ||||||||||||||||||||||||
Loans receivable (1),(2): | ||||||||||||||||||||||||
Commercial and industrial | $ | 1,910,635 | 22,542 | 4.72 | % | 1,901,394 | $ | 23,028 | 4.84 | % | ||||||||||||||
Home equity | 226,345 | 2,348 | 4.15 | 232,458 | 2,418 | 4.16 | ||||||||||||||||||
Second mortgage | 44,600 | 656 | 5.88 | 47,844 | 698 | 5.84 | ||||||||||||||||||
Residential real estate | 111,514 | 1,338 | 4.80 | 89,010 | 1,161 | 5.22 | ||||||||||||||||||
Other | 46,248 | 794 | 6.87 | 49,361 | 844 | 6.84 | ||||||||||||||||||
Total loans receivable | 2,339,342 | 27,678 | 4.73 | 2,320,067 | 28,149 | 4.85 | ||||||||||||||||||
Investment securities (3) | 548,355 | 3,375 | 2.46 | 498,329 | 3,582 | 2.88 | ||||||||||||||||||
Interest-earning bank balances | 54,130 | 34 | 0.25 | 118,350 | 71 | 0.24 | ||||||||||||||||||
Total interest-earning assets | 2,941,827 | 31,087 | 4.23 | 2,936,746 | 31,802 | 4.33 | ||||||||||||||||||
Non-interest earning assets: | ||||||||||||||||||||||||
Cash and due from banks | 73,863 | 72,744 | ||||||||||||||||||||||
Bank properties and equipment, net | 55,264 | 55,461 | ||||||||||||||||||||||
Goodwill and intangible assets, net | 45,586 | 46,511 | ||||||||||||||||||||||
Other assets | 113,159 | 123,089 | ||||||||||||||||||||||
Total non-interest-earning assets | 287,872 | 297,805 | ||||||||||||||||||||||
Total assets | $ | 3,229,699 | 3,234,551 | |||||||||||||||||||||
Interest-bearing liabilities: | ||||||||||||||||||||||||
Interest-bearing deposit accounts: | ||||||||||||||||||||||||
Interest-bearing demand deposits | $ | 1,271,991 | 1,435 | 0.45 | % | 1,286,426 | $ | 1,589 | 0.49 | % | ||||||||||||||
Savings deposits | 265,115 | 285 | 0.43 | 270,196 | 321 | 0.48 | ||||||||||||||||||
Time deposits | 633,108 | 2,321 | 1.47 | 631,415 | 2,388 | 1.51 | ||||||||||||||||||
Total interest-bearing deposit accounts | 2,170,214 | 4,041 | 0.74 | 2,188,037 | 4,298 | 0.79 | ||||||||||||||||||
Short-term borrowings: | ||||||||||||||||||||||||
Federal Funds Purchased | 141 | - | - | - | - | - | ||||||||||||||||||
Securities sold under agreements to repurchase- customers | 5,906 | 1 | 0.07 | 6,952 | 1 | 0.06 | ||||||||||||||||||
Long-term borrowings: | ||||||||||||||||||||||||
FHLBNY advances (4) | 17,842 | 219 | 4.91 | 18,162 | 223 | 4.91 | ||||||||||||||||||
Obligations under capital lease | 7,897 | 131 | 6.64 | 7,959 | 132 | 6.63 | ||||||||||||||||||
Junior subordinated debentures | 92,786 | 695 | 3.00 | 92,786 | 675 | 2.91 | ||||||||||||||||||
Total borrowings | 124,572 | 1,046 | 3.36 | 125,859 | 1,031 | 3.28 | ||||||||||||||||||
Total interest-bearing liabilities | 2,294,786 | 5,087 | 0.89 | 2,313,896 | 5,329 | 0.92 | ||||||||||||||||||
Non-interest bearing liabilities: | ||||||||||||||||||||||||
Non-interest-bearing demand deposits | 536,558 | 528,505 | ||||||||||||||||||||||
Other liabilities | 87,569 | 84,125 | ||||||||||||||||||||||
Total non-interest bearing liabilities | 624,127 | 612,630 | ||||||||||||||||||||||
Total liabilities | 2,918,913 | 2,926,526 | ||||||||||||||||||||||
Shareholders' equity | 310,786 | 308,025 | ||||||||||||||||||||||
Total liabilities and shareholders' equity | $ | 3,229,699 | 3,234,551 | |||||||||||||||||||||
Net interest income | 26,000 | $ | 26,473 | |||||||||||||||||||||
Interest rate spread (5) | 3.34% | 3.41% | ||||||||||||||||||||||
Net interest margin (6) | 3.54% | 3.61% | ||||||||||||||||||||||
Ratio of average interest-earning assets to average interest-bearing liabilities | 128.20 | % | 126.92 | % | ||||||||||||||||||||
(1) Average balances include non-accrual loans and loans held-for-sale. | ||||||||||||||||||||||||
(2) Loan fees are included in interest income and the amount is not material for this analysis. | ||||||||||||||||||||||||
(3) Interest earned on non-taxable investment securities is shown on a tax-equivalent basis assuming a 35% marginal federal tax rate for all periods. The fully taxable equivalent adjustments for the three months ended December 31, 2011 and September 30, 2011 were $271 thousand and $292 thousand, respectively. | ||||||||||||||||||||||||
(4) Amounts include Advances from FHLBNY and Securities sold under agreements to repurchase- FHLBNY. | ||||||||||||||||||||||||
(5) Interest rate spread represents the difference between the average yield on interest-earning assets and the average cost of interest-bearing liabilities. | ||||||||||||||||||||||||
(6) Net interest margin represents net interest income as a percentage of average interest-earning assets. | ||||||||||||||||||||||||
SOURCE Sun Bancorp, Inc.
