Columbia Banking System Announces Fourth Quarter and Full Year 2009 Results; Declares Cash Dividend
Fourth Quarter Profitable, Business Fundamentals Remain Strong; Company is Very Well Capitalized, With Strong Liquidity and Excellent Core Deposit Base
Highlights for the Quarter
- Net Income of $447,000, or $0.02 per common share
- Remains very well capitalized at 19.60% total risk-based capital ratio
- Residential construction loans decline to 5.4% of total loans at December 31, 2009.
- Liquidity ratio of 51%, or over $1.6 billion of available funding from multiple sources
- Very strong core deposits at 83% of total deposits
- Stable net interest margin of 4.30%
- Vancouver, WA branch added; 52-branch network at year-end 2009.
- Columbia River Bank, The Dalles, Oregon, acquired on January 22, 2010 in FDIC-assisted transaction; brings network to 73 branches in Washington and Oregon.
TACOMA, Wash., Jan. 28 /PRNewswire-FirstCall/ -- Columbia Banking System, Inc. (Nasdaq: COLB) ("Columbia") today announced net income applicable to common shareholders of $447,000 for the quarter ended December 31, 2009, compared to $1.3 million for the same quarter of 2008. On a diluted earnings per common share basis, net income was $0.02, compared with net income of $0.07 per share a year earlier. These results were achieved while the Company added $15.0 million to the provision for loan losses due to the continued decline in real estate values, principally relating to residential land, lots and lot development loans.
The year 2009 resulted in a net loss applicable to common shareholders of $8.4 million, compared with earnings of $5.5 million for 2008, primarily reflecting a $63.5 million provision for loan losses in 2009. On a diluted per common share basis, the net loss for 2009 was $0.38 compared with income of $0.30 a year earlier.
"We are pleased to have achieved a profitable fourth quarter in this continuing and difficult economic environment," said Melanie Dressel, President and Chief Executive Officer. "Despite our proactive concentration on managing credit issues, our 2009 earnings were obviously impacted by declining real estate values. However, our results for the quarter and the year serve to confirm our long-standing business model. We remain very well capitalized, with multiple sources of liquidity and a diversified loan portfolio. We have significantly reduced our exposure to residential construction loans. Our core value of building relationships with our customers continues to generate an exceptional level of core deposits, which are an important factor in the relatively stable net interest margin we have maintained. We believe we are very well positioned to become even stronger as we navigate through this economic cycle."
Ms. Dressel continued, "Our strength and capital level also give us the ability to take advantage of opportunities to move further toward our goal of growing into a true Pacific Northwest regional community bank. On January 22, 2010, we acquired Columbia River Bank through an FDIC-assisted transaction, significantly expanding our footprint in both Oregon and Washington."
Revenue
Revenue (net interest income plus noninterest income) was $ 38.3 million for the fourth quarter of 2009, up 7% from $35.7 million one year ago. The significant increase was primarily due to an additional $1.0 million impairment charge in the fourth quarter 2008 related to the decline in the fair value of an investment in preferred stock issued by the Federal Home Loan Mortgage Corporation ("Freddie Mac") and the Federal National Mortgage Association ("Fannie Mae"). Excluding the impairment charge in 2008, revenue for the fourth quarter 2009 was up 4% from fourth quarter 2008.,
Revenue for the year ended December 31, 2009 was $145.0 million, an increase of 8% from $134.4 million for the same period in 2008. Excluding the 2008 impairment charge, redemption of Visa and MasterCard shares and gain on the sale of investment securities, revenue for the year 2009 was down 3% from 2008.
At December 31, 2009, Columbia's total assets were $3.2 billion, an increase of 3% from $3.10 billion at December 31, 2008. Total loans were $2.01 billion at December 31, 2009, down 10% from $2.23 billion at year-end 2008. Total securities increased $91.7 million to $631.6 million at December 31, 2009 as a result of management's asset/liability strategies. Total deposits were $2.48 billion at December 31, 2009, an increase of 4% from $2.38 billion at December 31, 2008, and an increase of 2% from $2.44 billion at September 30, 2009. Core deposits, defined as demand, savings, money market accounts and certificates of deposit under $100,000, totaled $2.07 billion at December 31, 2009, comprising 83% of total deposits.
Ms. Dressel noted, "We have continued to focus on developing our customer relationships, resulting in core deposits that have helped us achieve a lower cost deposit mix. The decrease in our total loans reflects the soft market and the resulting lower demand, as well as payoffs in the construction loan portfolio. The decrease in our commercial business loans is primarily a result of loan pay-downs and a decrease in line of credit usage."
Acquisition of Columbia River Bank
On January 22, 2010, Columbia State Bank acquired all of the deposits and certain assets of Columbia River Bank from the Federal Deposit Insurance Corporation, which had been appointed receiver of the institution. We acquired approximately $1 billion in assets and $980 million in deposits through 21 branches located in Oregon and Washington. Columbia River Bank's approximately $700 million in loans are subject to a loss-sharing agreement with the FDIC. We participated in a competitive bid process, whereby we agreed to assume all of the deposits and nearly all of the assets of Columbia River Bank. The accepted bid included a 1% deposit premium on non-brokered deposits and a negative bid of $43.9 million.
Fourth Quarter 2009 Operating Results
Net Interest Income
Net interest income for the fourth quarter of 2009 increased $481,000, or 2%, from $29.3 million for the fourth quarter 2008, reflecting a $176,000 recovery related to a nonperforming loan and a decrease in interest expense on deposits. For the year ended December 31, 2009, net interest income decreased 4% to $115.4 million from $119.5 million a year earlier, primarily due to a decrease in earning assets from the prior year.
Columbia's net interest margin was 4.30% for the fourth quarter 2009, down from 4.39% for the fourth quarter of 2008. On a quarterly basis, the net interest margin was 4.26% for the first quarter of 2009, 4.38% for the second quarter of 2009, and 4.34% in the third quarter of 2009. Interest reversals impacting the net interest margin for the fourth quarter 2009 were $194,569, representing approximately 2 basis points.
Average interest-earning assets increased 4% to $2.87 billion in the fourth quarter of 2009, from $2.77 billion in the fourth quarter of 2008. The yield on average interest-earning assets decreased 80 basis points to 5.12% in the fourth quarter of 2009, from 5.92% in the fourth quarter of 2008. During the same period, average interest-bearing liabilities decreased to $2.04 billion from $2.19 billion last year. The cost of average interest-bearing liabilities decreased 77 basis points to 1.16% in the fourth quarter of 2009, compared with 1.93% in the fourth quarter of 2008. Ms. Dressel noted, "These results reflect the rapid decline in interest rates during 2008. The prime rate was 7.25% at the beginning of January 2008, and ended the year at 3.25%, the current rate."
For the year ending December 31, 2009, Columbia's net interest margin decreased to 4.33% from 4.38% a year earlier. Average interest-earning assets decreased to $2.78 billion for the year 2009 from $2.85 billion for 2008. The yield on average interest-earning assets decreased 101 basis points to 5.32% in 2009, from 6.33% in 2008. Average interest-bearing liabilities were $2.07 billion compared to $2.28 billion for 2008. The cost of average interest-bearing liabilities decreased 110 basis points to 1.34% in 2009, compared with 2.44% for 2008. Interest reversals impacting the net interest margin for 2009 were $2.1 million, representing approximately 7 basis points.
Noninterest income
Total noninterest income for the fourth quarter 2009 was $8.5 million, an increase of 35% from $6.3 million a year earlier. The increase was primarily due to a $1 million impairment charge in the fourth quarter 2008 related to the decline in the fair value of an investment in preferred stock issued by the Federal Home Loan Mortgage Corporation ("Freddie Mac") and the Federal National Mortgage Association ("Fannie Mae"). Excluding the impact of the impairment charge and gains and losses on sales of securities, noninterest income was relatively unchanged from the prior-year quarter. Other income was down approximately 22% from fourth quarter, 2008 primarily due to reduced fees from residential mortgage origination activity, as well as reduced income from the loan customer interest rate swap program.
For the year ended December 31, 2009, noninterest income was $29.7 million, an increase of $14.8 million, or 100%, from 2008. The increase was primarily due to the $18.5 million impairment charge in the third quarter 2008 related to Freddie Mac and Fannie Mae investments as noted above. Excluding the impact of the impairment charge, gains on sales of securities and proceeds from the redemption of Visa and MasterCard shares, noninterest income declined 6% from 2008. Proceeds from the redemption of Visa and MasterCard shares for 2009 declined $3 million from 2008, and other income for 2009 declined $1.6 million, or 27% from 2008 partially due to the receipt of life insurance proceeds of $612,000 received in the prior year, as well as reduced fees from residential mortgage origination activity and less activity in the loan customer interest rate swap program.
Noninterest expense
Noninterest expense for the fourth quarter of 2009 was $22.8 million, an increase of 5% from $21.8 million a year earlier. Decreases in compensation and benefits, advertising and promotion and other expenses resulting from the continued focus on expense control were offset by higher regulatory premiums and additional costs of operating other real estate owned. Regulatory premiums increased $442,000, or 72%, from the fourth quarter of 2008, resulting from increased FDIC assessment rates. Other real estate owned balances increased to $19.0 million at December 31, 2009, compared to $2.9 million at December 31, 2008, contributing to a $1.0 million increase in the cost of operating from December 31, 2008.
Total noninterest expense for 2009 was $94.5 million, an increase of $2.4 million, or 3%, from $92.1 million a year earlier. Decreases of 4% in compensation and employee benefits, and 6% in occupancy expenses were again significantly offset by legal and professional fees and FDIC regulatory premium expenses. Legal and professional fees were $3.9 million for 2009, compared to $2.0 million for 2008. FDIC regulatory premium expenses were $5.8 million for 2009, compared to $2.1 million one year ago.
Nonperforming Assets and Loan Loss Provision
As of December 31, 2009, non-performing assets were $129.5 million, compared to $109.6 million at December 31, 2008 and down from $148.9 million at September 30, 2009. 1-4 Family Residential Construction assets continue to be the largest component of nonperforming assets; however, it was also the area where we saw the largest reduction in nonperforming assets. The balance of the portfolio remained relatively stable. Detail is provided in the table below.
Multi-family
Multi-family Residential
1-4 Family Residential and
Non Accrual & 1-4 Family Residential and Commercial
Restructured Residential Real Estate Commercial Real Estate
Loans Real Estate Construction Real Estate Construction
----- ----------- ------------ ----------- ------------
December 31, 2009 $1,860 $47,713 $24,354 $16,230
----------------- ------ ------- ------- -------
September 30, 2009 $2,665 $65,527 $26,650 $19,138
------------------ ------ ------- ------- -------
June 30, 2009 $1,879 $65,168 $24,256 $22,099
------------- ------ ------- ------- -------
December 31, 2008 $905 $69,667 $5,710 $25,752
----------------- ---- ------- ------ -------
OREO
----
December 31, 2009 $0 $15,045 $3,195 $797
----------------- --- ------- ------ ----
September 30, 2009 $0 $15,830 $1,510 $797
------------------ --- ------- ------ ----
June 30, 2009 $0 $6,859 $1,510 $0
------------- --- ------ ------ ---
December 31, 2008 $0 $2,874 $0 $0
----------------- --- ------ --- ---
Nonperforming Assets
--------------------
December 31, 2009 $1,860 $62,757 $27,550 $17,027
----------------- ------ ------- ------- -------
September 30, 2009 $2,665 $81,358 $28,160 $19,935
------------------ ------ ------- ------- -------
June 30, 2008 $1,879 $72,028 $25,766 $22,099
------------- ------ ------- ------- -------
December 31, 2008 $905 $72,541 $5,710 $25,752
----------------- ---- ------- ------ -------
Non Accrual &
Restructured Commercial
Loans Business Consumer Total
----- -------- -------- -----
December 31, 2009 $18,979 $1,355 $110,491
----------------- ------- ------ --------
September 30, 2009 $14,969 $1,769 $130,718
------------------ ------- ------ --------
June 30, 2009 $12,198 $2,167 $127,767
------------- ------- ------ --------
December 31, 2008 $3,563 $1,152 $106,750
----------------- ------ ------ --------
OREO
----
December 31, 2009 $0 $0 $19,037
----------------- --- --- -------
September 30, 2009 $0 $0 $18,137
------------------ --- --- -------
June 30, 2009 $0 $0 $8,369
------------- --- --- ------
December 31, 2008 $0 $0 $2,874
----------------- --- --- ------
Nonperforming Assets
--------------------
December 31, 2009 $18,979 $1,355 $129,528
----------------- ------- ------ --------
September 30, 2009 $14,968 $1,769 $148,855
------------------ ------- ------ --------
June 30, 2008 $12,198 $2,167 $136,136
------------- ------- ------ --------
December 31, 2008 $3,563 $1,152 $109,624
----------------- ------ ------ --------
For the quarter ended December 31, 2009, net loan charge-offs were approximately $13.2 million, compared to $6.3 million for the same period a year ago, and $13.7 million during the third quarter of 2009. Net charge-offs in the 1-4 family residential construction portfolio of $5.2 million for the quarter were centered in residential land and lot development loans. Commercial real estate construction net charge-offs of $1.7 million were related to write-downs on condominium loans. The commercial business pool had charge- offs of approximately $4.5 million, and continue to be centered in loans related to the construction and real estate development industries. The consumer portfolio had $1.2 million in net charge-offs primarily centered in home equity lines of credit. For the year ending December 31, 2009, net charges-offs were $52.7 million. Most of the net charges were in the 1-4 family residential construction portfolio, followed by commercial business loans and commercial construction loan net charge-offs. The breakout by portfolio is in the table below.
Multi-family
Multi-family Residential
1-4 Family Residential and
1-4 Family Residential and Commercial
Residential Real Estate Commercial Real Estate
Real Estate Construction Real Estate Construction
----------- ------------ ----------- ------------
2009 Net Loan
Charge-Offs $327 $26,878 $1,284 $9,297
------------- ---- ------- ------ ------
2008 Net Loan
Charge-Offs $46 $18,324 $662 $2,169
------------- --- ------- ---- ------
Commercial
Business Consumer Total
-------- -------- -----
2009 Net Loan
Charge-Offs $12,180 $2,803 $52,769
------------- ------- ------ -------
2008 Net Loan
Charge-Offs $2,547 1,280 $25,028
------------- ------ ----- -------
For the fourth quarter 2009, the provision for loan losses was $15.0 million compared to $13.3 million for the same quarter last year and $16.5 million for the third quarter of 2009. The elevated levels of provisioning are related to continued weakness in the Pacific Northwest economy. The allowance for loan losses as a percentage of outstanding loans at December 31, 2009 was 2.66% compared to 1.91% and 2.50% at December 31, 2008 and September 30, 2009, respectively.
Past due loans were $9.1 million, or 0.45% of total loans, as of December 31, 2009, compared to $10.4 million or 0.46%, of total loans, at December 31, 2008 and $12.0 million or 0.58% as of September 30, 2009.
"Overall it was an improving quarter for credit quality," said Ms. Dressel. "Most importantly, we were able to reduce our level of nonperforming assets. In addition, we continue to be pleased with our ability to reduce exposure in the areas of residential and commercial construction which declined by 18% or $33 million during the quarter."
Organizational Update
Ms. Dressel said, "During 2009, we moved forward with strategies designed to increase our resources and presence in markets where we were able to capitalize on opportunities to fill in our geographic footprint and increase market share. We brought on board experienced teams of bankers, particularly in our Vancouver, Washington and Portland, Oregon markets, who have been able to take advantage of our capacity and willingness to lend."
Ms. Dressel noted, "We are very pleased with the progress of our new locations, including our Renton, Washington branch which opened in July, followed by an office in Vancouver in mid-December. Our Portland office, which will house business bankers and a full-service branch in the Fox Tower, is scheduled to open in late first quarter of this year. These growth initiatives, along with our acquisition of Columbia River Bank, help to offset the lower loan demand in the current economy, and position us well for the future."
Cash Dividend Announcement
The Board of Directors has announced a quarterly cash dividend of $0.01 per common share, which will be paid on February 24, 2010 to shareholders of record as of the close of business on February 10, 2010
Conference Call
Columbia's management will discuss the fourth quarter results on a conference call scheduled for January 28, 2010 at 1:00 p.m. PST (4:00 p.m. EST). Interested parties may listen to this discussion by calling 1-888-318-7969; Conference ID code #49843829.
A conference call replay will be available from approximately 4:00 p.m. PST on
January 28, 2010 through midnight PST on February 3, 2010. The conference call replay can be accessed by dialing 1-800-642-1687 and entering Conference ID code #49843829.
Annual Meeting of Shareholders (New Location from previous Annual Meetings)
Columbia Banking System's Annual Meeting of Shareholders will be held at 1:00 PDT on April 28, 2010, at the William W. Philip Hall at the University of Washington Tacoma., 1900 Commerce Street, Tacoma, Washington 98402. The Hall is named in honor of William W. "Bill" Philip, who had a seminal role in establishing UW Tacoma, and was a co-founder of Columbia Bank.
Directions and parking information are available at www.tacoma.washington.edu/conference.
About Columbia
Headquartered in Tacoma, Washington, Columbia Banking System, Inc. is the holding company of Columbia Bank, a Washington state-chartered full-service commercial bank which was awarded second place in the large employer category by Seattle Business Magazine's 100 Best Companies to Work For 2009 and was designated one of Puget Sound Business Journal's "Washington's Best Workplaces 2009." With the January 22, 2010 FDIC-assisted acquisition of Columbia River Bank, Columbia Banking System has 73 banking offices in ten counties in Washington State, and eleven counties in Oregon. Columbia Bank does business under the Bank of Astoria name at the Bank of Astoria's former branches located in Astoria, Warrenton, Seaside and Cannon Beach in Clatsop County and in Manzanita and Tillamook in Tillamook County. More information about Columbia can be found on its website at www.columbiabank.com.
Note Regarding Forward Looking Statements
This news release includes forward looking statements, which management believes are a benefit to shareholders. These forward looking statements describe management's expectations regarding future events and developments such as future operating results, growth in loans and deposits, continued success of our style of banking and the strength of the local economy. The words "will," "believe," "expect," "should," and "anticipate" and words of similar construction are intended in part to help identify forward looking statements. Future events are difficult to predict, and the expectations described above are necessarily subject to risk and uncertainty that may cause actual results to differ materially and adversely. In addition to discussions about risks and uncertainties set forth from time to time in our filings with the SEC, factors that may cause actual results to differ materially from those contemplated by such forward looking statements include, among others, the following possibilities: (1) local and national economic conditions are less favorable than expected or have a more direct and pronounced effect on us than expected and adversely affect our ability to continue internal growth at historical rates and maintain the quality of our earning assets; (2) a continued decline in the housing/real estate market; (3) changes in interest rates significantly reduce interest margins and negatively affect funding sources; (4) deterioration of credit quality that could, among other things, increase defaults and delinquency risks in the Banks' loan portfolios (5) projected business increases following strategic expansion activities are lower than expected; (6) competitive pressure among financial institutions increases significantly; (7) legislation or regulatory requirements or changes adversely affect the businesses in which we are engaged; and (8) our ability to realize the efficiencies we expect to receive from our investments in personnel, acquisitions and infrastructure
FINANCIAL STATISTICS
Columbia Banking System, Inc. Three Months Ended Twelve Months Ended
Unaudited December 31, December 31,
------------ ------------
(dollars in thousands
except per share) 2009 2008 2009 2008
---- ---- ---- ----
Earnings
--------
Net interest income $29,800 $29,319 $115,352 $119,513
Provision for loan and
lease losses $15,000 $13,250 $63,500 $41,176
Noninterest income $8,526 $6,334 $29,690 $14,850
Noninterest expense $22,847 $21,813 $94,488 $92,125
Net income (loss) $1,552 $1,814 $(3,968) $5,968
Net income (loss)
applicable to common
shareholders $447 $1,344 $(8,371) $5,498
Per Common Share
-----------------
Earnings (loss)
(basic) $0.02 $0.07 $(0.38) $0.30
Earnings (loss)
(diluted) $0.02 $0.07 $(0.38) $0.30
Averages
--------
Total assets $3,177,098 $3,061,867 $3,084,421 $3,134,054
Interest- earning
assets $2,872,842 $2,767,854 $2,783,862 $2,851,555
Loans $2,034,903 $2,214,918 $2,124,574 $2,264,486
Securities $643,716 $535,763 $584,028 $565,299
Deposits $2,453,553 $2,297,422 $2,378,176 $2,382,484
Core deposits $2,039,533 $1,865,402 $1,945,039 $1,911,897
Interest-bearing
deposits $1,890,479 $1,837,166 $1,866,917 $1,921,737
Interest-bearing
liabilities $2,041,761 $2,193,437 $2,067,014 $2,277,422
Noninterest-bearing
deposits $563,074 $460,257 $511,259 $460,747
Shareholders' equity $530,804 $368,184 $462,167 $354,387
Financial Ratios
----------------
Return on average
assets 0.19% 0.24% (0.13%) 0.19%
Return on average
common equity 0.39% 1.60% (2.16%) 1.59%
Average equity to
average assets 16.71% 12.02% 14.98% 11.31%
Net interest margin 4.30% 4.39% 4.33% 4.38%
Efficiency ratio (tax
equivalent)(1) 58.12% 57.62% 61.53% 59.88%
December 31,
------------
Period end 2009 2008
---------- ---- ----
Total assets $3,200,930 $3,097,079
Loans $2,008,884 $2,232,332
Allowance for loan
and lease losses $53,478 $42,747
Securities $631,645 $540,525
Deposits $2,482,705 $2,382,151
Core deposits $2,072,821 $1,941,047
Shareholders' equity $528,139 $415,385
Book value per common
share $16.13 $18.82
Nonperforming assets
--------------------
Nonaccrual loans $110,431 $106,163
Restructured loans
accruing interest 60 587
Other real estate
owned 19,037 2,874
------ -----
Total
nonperforming
assets $129,528 $109,624
-------- --------
Nonperforming loans to
period-end loans 5.50% 4.78%
Nonperforming assets to
period-end assets 4.05% 3.54%
Allowance for loan and
lease losses to period-
end loans 2.66% 1.91%
Allowance for loan and
lease losses to
nonperforming loans 48.40% 40.04%
Allowance for loan and
lease losses to
nonperforming assets 41.29% 38.99%
Net loan charges-offs $52,769 (2) $25,028 (3)
(1) Noninterest expense divided by the sum of net interest income and
noninterest income on a tax equivalent basis, excluding gain/loss
on sale of investment securities, net cost (gain) of OREO, proceeds
from redemption of Visa and Mastercard shares, reversal of
previously accrued Visa litigation expense, net income from BOLI
policy swap transactions, death benefit insurance proceeds and
other than temporary security impairment charge.
(2) For the twelve months ended December 31, 2009.
(3) For the twelve months ended December 31, 2008.
FINANCIAL STATISTICS
Columbia Banking System, Inc.
Unaudited December 31,
------------
(dollars in thousands) 2009 2008
--------------- ---------------
Loan Portfolio Composition
--------------------------
Commercial business $744,440 37.0% $810,922 36.3%
Real Estate:
One-to-four family residential 63,364 3.1% 57,237 2.6%
Five or more family residential
and commercial 856,260 42.6% 862,595 38.7%
------- ---- ------- ----
Total Real Estate 919,624 45.7% 919,832 41.3%
Real Estate Construction:
One-to-four family residential 107,620 5.4% 209,682 9.4%
Five or more family residential
and commercial 41,829 2.1% 81,176 3.6%
------ --- ------ ---
Total Real Estate
Construction 149,449 7.5% 290,858 13.0%
Consumer 199,987 10.0% 214,753 9.6%
------- ---- ------- ---
Subtotal loans 2,013,500 100.2% 2,236,365 100.2%
Less: Deferred loan fees (4,616) -0.2% (4,033) -0.2%
------ ---- ------ ----
Total loans $2,008,884 100.0% $2,232,332 100.0%
========== ===== ========== =====
Loans held for sale $- $1,964
== ======
December 31,
------------
2009 2008
--------------- ---------------
Deposit Composition
-------------------
Core deposits:
Demand and other noninterest-
bearing $574,687 23.1% $466,078 19.6%
Interest-bearing demand 499,922 20.1% 519,124 21.8%
Money market 604,229 24.3% 530,065 22.3%
Savings 139,406 5.6% 122,076 5.1%
Certificates of deposit less
than $100,000 254,577 10.3% 303,704 12.7%
------- ---- ------- ----
Total core deposits 2,072,821 83.4% 1,941,047 81.5%
Certificates of deposit greater
than $100,000 259,794 10.5% 338,971 14.2%
Wholesale certificates of deposit
(CDARS( R )) 96,314 3.9% 39,903 1.7%
Wholesale certificates of deposit 53,776 2.2% 62,230 2.6%
------ --- ------ ---
Total deposits $2,482,705 100.0% $2,382,151 100.0%
========== ===== ========== =====
QUARTERLY FINANCIAL STATISTICS
Columbia Banking System, Inc. Three Months Ended
------------------
Unaudited Dec 31 Sep 30 Jun 30
(dollars in thousands except per share) 2009 2009 2009
---- ---- ----
Earnings
--------
Net interest income $29,800 $29,118 $28,531
Provision for loan and lease
losses $15,000 $16,500 $21,000
Noninterest income $8,526 $7,190 $7,000
Noninterest expense $22,847 $23,146 $25,314
Net income (loss) $1,552 $(1,502) $(5,530)
Net income (loss) applicable to
common shareholders $447 $(2,605) $(6,631)
Per Common Share
-----------------
Earnings (loss) (basic) $0.02 $(0.11) $(0.37)
Earnings (loss) (diluted) $0.02 $(0.11) $(0.37)
Book value $16.13 $16.15 $18.50
Averages
--------
Total assets $3,177,098 $3,077,005 $3,024,491
Interest-earning assets $2,872,842 $2,783,121 $2,728,086
Loans $2,034,903 $2,088,478 $2,159,415
Securities $643,716 $593,516 $554,270
Deposits $2,453,553 $2,395,311 $2,337,385
Core deposits $2,039,533 $1,977,977 $1,893,419
Interest-bearing deposits $1,890,479 $1,857,708 $1,850,193
Interest-bearing liabilities $2,041,761 $2,019,051 $2,073,750
Noninterest-bearing deposits $563,074 $537,603 $487,192
Shareholders' equity $530,804 $478,589 $417,961
Financial Ratios
----------------
Return on average assets 0.19% (0.19%) (0.73%)
Return on average common equity 0.39% (2.56%) (7.73%)
Average equity to average assets 16.71% 15.55% 13.82%
Net interest margin 4.30% 4.34% 4.38%
Efficiency ratio (tax equivalent) 58.12% 60.85% 63.79%
Period end
----------
Total assets $3,200,930 $3,167,028 $3,021,857
Loans $2,008,884 $2,063,398 $2,119,443
Allowance for loan and lease
losses $53,478 $51,688 $48,880
Securities $631,645 $658,227 $558,011
Deposits $2,482,705 $2,443,567 $2,353,326
Core deposits $2,072,821 $2,027,482 $1,932,771
Shareholders' equity $528,139 $527,920 $411,871
Nonperforming assets
--------------------
Nonaccrual loans $110,431 $130,718 $127,767
Restructured loans accruing
interest 60 - -
Other real estate owned 19,037 18,137 8,369
------ ------ -----
Total nonperforming assets $129,528 $148,855 $136,136
-------- -------- --------
Nonperforming loans to period-end
loans 5.50% 6.34% 6.03%
Nonperforming assets to period-end
assets 4.05% 4.70% 4.51%
Allowance for loan and lease losses
to period-end loans 2.66% 2.50% 2.31%
Allowance for loan and lease losses
to nonperforming loans 48.40% 39.54% 38.26%
Allowance for loan and lease losses
to nonperforming assets 41.29% 34.72% 35.91%
Net loan charge-offs $13,210 $13,692 $16,369
Columbia Banking System, Inc. Three Months Ended
------------------
Unaudited Mar 31 Dec 31
(dollars in thousands except per share) 2009 2008
---- ----
Earnings
--------
Net interest income $27,903 $29,319
Provision for loan and lease
losses $11,000 $13,250
Noninterest income $6,974 $6,334
Noninterest expense $23,181 $21,813
Net income (loss) $1,512 $1,814
Net income (loss) applicable to
common shareholders $419 $1,344
Per Common Share
-----------------
Earnings (loss) (basic) $0.02 $0.07
Earnings (loss) (diluted) $0.02 $0.07
Book value $18.73 $18.82
Averages
--------
Total assets $3,057,861 $3,061,867
Interest-earning assets $2,774,259 $2,767,854
Loans $2,217,908 $2,214,918
Securities $543,403 $535,763
Deposits $2,324,853 $2,297,422
Core deposits $1,867,001 $1,865,402
Interest-bearing deposits $1,869,155 $1,837,166
Interest-bearing liabilities $2,135,045 $2,193,437
Noninterest-bearing deposits $455,698 $460,257
Shareholders' equity $419,752 $368,184
Financial Ratios
----------------
Return on average assets 0.20% 0.24%
Return on average common equity 0.49% 1.60%
Average equity to average assets 13.73% 12.02%
Net interest margin 4.26% 4.39%
Efficiency ratio (tax equivalent) 63.59% 57.62%
Period end
----------
Total assets $3,045,757 $3,097,079
Loans $2,185,755 $2,232,332
Allowance for loan and lease
losses $44,249 $42,747
Securities $555,974 $540,525
Deposits $2,344,406 $2,382,151
Core deposits $1,873,626 $1,941,047
Shareholders' equity $415,717 $415,385
Nonperforming assets
--------------------
Nonaccrual loans $117,340 $106,163
Restructured loans accruing
interest - 587
Other real estate owned 4,312 2,874
----- -----
Total nonperforming assets $121,652 $109,624
-------- --------
Nonperforming loans to period-end
loans 5.37% 4.78%
Nonperforming assets to period-end
assets 3.99% 3.54%
Allowance for loan and lease losses
to period-end loans 2.02% 1.91%
Allowance for loan and lease losses
to nonperforming loans 37.71% 40.04%
Allowance for loan and lease losses
to nonperforming assets 36.37% 38.99%
Net loan charge-offs $9,498 $6,317
CONSOLIDATED CONDENSED STATEMENTS OF INCOME
Three Months Twelve Months
Columbia Banking System, Inc. Ended Ended
(Unaudited) December 31, December 31,
------------ ------------
(in thousands except per share) 2009 2008 2009 2008
------------------------------- ---- ---- ---- ----
Interest Income
Loans $28,860 $33,603 $117,062 $147,830
Taxable securities 4,570 4,362 17,300 18,852
Tax-exempt securities 2,200 1,979 8,458 7,976
Federal funds sold and deposits
in banks 146 23 215 402
------------------------------- --- -- --- ---
Total interest income 35,776 39,967 143,035 175,060
Interest Expense
Deposits 4,953 8,863 23,250 45,307
Federal Home Loan Bank and
Federal Reserve Bank borrowings 643 1,109 2,759 7,573
Long-term obligations 260 461 1,197 1,800
Other borrowings 120 215 477 867
---------------- --- --- --- ---
Total interest expense 5,976 10,648 27,683 55,547
---------------------- ----- ------ ------ ------
Net Interest Income 29,800 29,319 115,352 119,513
Provision for loan and lease
losses 15,000 13,250 63,500 41,176
---------------------------- ------ ------ ------ ------
Net interest income after
provision for loan and lease
losses 14,800 16,069 51,852 78,337
Noninterest Income
Service charges and other fees 4,199 3,684 15,181 14,813
Merchant services fees 1,714 1,881 7,321 8,040
Redemption of Visa and Mastercard
shares - - 49 3,028
Gain (loss) on sale of investment
securities, net 1,077 (36) 1,077 846
Impairment charge on investment
securities - (1,024) - (19,541)
Bank owned life insurance ("BOLI") 491 488 2,023 2,075
Other 1,045 1,341 4,039 5,589
----- ----- ----- ----- -----
Total noninterest income 8,526 6,334 29,690 14,850
Noninterest Expense
Compensation and employee benefits 11,258 11,398 47,275 49,315
Occupancy 3,123 3,132 12,128 12,838
Merchant processing 860 827 3,449 3,558
Advertising and promotion 268 527 1,943 2,324
Data processing 1,073 979 4,047 3,486
Legal and professional fees 1,092 490 3,871 1,969
Taxes, licenses and fees 503 650 2,478 2,917
Regulatory premiums 1,058 616 5,777 2,141
Net cost of operation of other
real estate 271 (30) 861 (49)
Other 3,341 3,224 12,659 13,626
----- ----- ----- ------ ------
Total noninterest expense 22,847 21,813 94,488 92,125
------------------------- ------ ------ ------ ------
Income (loss) before income taxes 479 590 (12,946) 1,062
Income tax benefit (1,073) (1,224) (8,978) (4,906)
------------------ ------ ------ ------ ------
Net Income (Loss) $1,552 $1,814 $(3,968) $5,968
================= ====== ====== ======= ======
Net Income (Loss) Applicable to
Common Shareholders $447 $1,344 $(8,371) $5,498
=============================== ==== ====== ======= ======
Earnings (loss) per common share (1)
Basic $0.02 $0.07 $(0.38) $0.30
Diluted $0.02 $0.07 $(0.38) $0.30
Dividends paid per common share $0.01 $0.07 $0.07 $0.58
Weighted average common shares
outstanding 27,841 17,959 21,854 17,914
Weighted average diluted common
shares outstanding 27,924 17,972 21,854 18,010
(1) The Company adopted authoritative guidance in the Earnings per Share
topic of the FASB Accounting Standards Codification on January 1,
2009. All prior periods have been restated to the current period's
presentation. The adoption of the authoritative guidance resulted
in a $0.01 per share reduction in basic and diluted EPS for the year
ended December 31, 2008
CONSOLIDATED CONDENSED BALANCE SHEETS
Columbia Banking System, Inc.
(Unaudited) December 31,
-------------
(in thousands) 2009 2008
-------------- ---- ----
ASSETS
Cash and due from banks $55,802 $84,787
Interest-earning deposits with banks 249,272 3,943
------------------------------------ ------- -----
Total cash and cash equivalents 305,074 88,730
Securities available for sale at fair value
(amortized cost of $602,675 and $525,110,
respectively) 620,038 528,918
Federal Home Loan Bank stock at cost 11,607 11,607
Loans held for sale - 1,964
Loans, net of deferred loan fees of ($4,616) and
($4,033), respectively 2,008,884 2,232,332
Less: allowance for loan and lease losses 53,478 42,747
----------------------------------------- ------ ------
Loans, net 1,955,406 2,189,585
Interest receivable 10,335 11,646
Premises and equipment, net 62,670 61,139
Other real estate owned 19,037 2,874
Goodwill 95,519 95,519
Core deposit intangible, net 4,863 5,908
Other assets 116,381 99,189
------------ ------- ------
Total Assets $3,200,930 $3,097,079
============ ========== ==========
LIABILITIES AND SHAREHOLDERS' EQUITY
Deposits:
Noninterest-bearing $574,687 $466,078
Interest-bearing 1,908,018 1,916,073
---------------- --------- ---------
Total deposits 2,482,705 2,382,151
Federal Home Loan Bank and Federal Reserve Bank
borrowings 100,000 200,000
Securities sold under agreements to repurchase 25,000 25,000
Other borrowings 86 201
Long-term subordinated debt 25,669 25,603
Other liabilities 39,331 48,739
----------------- ------ ------
Total liabilities 2,672,791 2,681,694
Commitments and contingent liabilities
December 31,
------------
2009 2008
---- ----
Preferred stock (no par value,
76,898 aggregate liquidation
preference)
Authorized shares 2,000 2,000
Issued and outstanding 77 77 74,301 73,743
Common Stock (no par value)
Authorized shares 63,033 63,033
Issued and outstanding 28,129 18,151 348,706 233,192
Retained earnings 93,316 103,061
Accumulated other comprehensive income 11,816 5,389
-------------------------------------- ------ -----
Total shareholders' equity 528,139 415,385
-------------------------- ------- -------
Total Liabilities and Shareholders' Equity $3,200,930 $3,097,079
========================================== ========== ==========
Contacts: |
|
Melanie J. Dressel, President and Chief Executive Officer |
|
(253) 305-1911 |
|
Gary R. Schminkey, Executive Vice President and Chief Financial Officer |
|
(253) 305-1966 |
|
SOURCE Columbia Banking System, Inc.
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