Sterling Bancshares Reports Third Quarter 2010 Results
HOUSTON, Oct. 28 /PRNewswire-FirstCall/ -- Sterling Bancshares, Inc. (Nasdaq: SBIB) today reported net income of $4.5 million, or $0.04 per diluted common share, for the third quarter ended September 30, 2010, as compared to a net loss of $24.7 million, or $0.30 for the third quarter of 2009.
Key items and metrics for the quarter include the following:
- Total nonperforming assets decreased $6 million, or 3.2% over the prior quarter;
- Period-end allowance for credit losses to period-end loans increased to 2.88% at September 30, 2010, from 2.18% at September 30, 2009;
- Provision for credit losses was $7.7 million for the third quarter of 2010, a reduction of $1.6 million on a linked-quarter basis;
- Tangible capital ratio was 9.13% and all regulatory capital ratios were in excess of those considered to be well-capitalized at September 30, 2010.
“We are pleased to see stabilization in a number of our credit metrics during the third quarter, which contributed to our overall improved profitability,” commented J. Downey Bridgwater, Sterling’s Chairman, President, and Chief Executive Officer. “Nonperforming loans, foreclosed real estate owned, and past due loans all decreased during the quarter. We continue to see property values stabilize for the most part which has helped to decrease our credit costs over the last couple of quarters. ”
“The Texas economy continues to recover from the recession at a fairly modest pace,” continued Bridgwater. “However, historically low interest rates combined with low loan demand has remained a headwind for revenue generation. As the economic recovery continues and there is additional clarity from a political and regulatory perspective, we anticipate more of our business customers will start to invest in the future growth of their businesses. Sterling is extremely well-positioned from a capital and liquidity standpoint to take advantage of these future opportunities as they arise.”
Total loans decreased $129 million or 4.3% on a linked-quarter basis to $2.9 billion at September 30, 2010, and decreased $481 million or 14.3% since September 30, 2009. The decline in loans during the third quarter of 2010 was due in part to a decrease in commercial real estate and construction and development loans of $42.1 million and $42.0 million, respectively, resulting from the Company’s decision to reduce exposure to these loan categories. The remaining decrease in loans was related to commercial and industrial loans which were impacted by continued low line-of-credit usage.
Average deposits decreased $61.1 million to $4.1 billion for the third quarter of 2010 compared to the second quarter of 2010. On average, noninterest-bearing deposits increased $27.0 million or 2.3% for the third quarter of 2010 compared to the second quarter of 2010. Due to continued growth in core deposits during the quarter, the Company was able to reduce higher-cost brokered and jumbo certificates of deposit by $58.8 million on a linked-quarter basis. Average total deposits increased $52.2 million or 1.2% for the third quarter of 2010 compared to the same quarter in 2009.
At September 30, 2010, nonperforming assets were $178 million or 3.54% of total assets, compared to $184 million or 3.63% at June 30, 2010. Potential problem loans were $170 million at September 30, 2010, an increase of $27.5 million over the prior quarter. The increase in potential problem loans during the third quarter of 2010 was due to a downgrade of certain non-owner occupied commercial real estate loans. Accruing loans 30-89 days past due were $16.2 million at September 30, 2010, a decrease of $3.1 million compared to the prior quarter and $18.0 million compared to December 31, 2009.
At September 30, 2010, the total allowance for credit losses was $82.8 million or 2.88% of period-end total loans, up slightly from $82.5 million or 2.75% of period-end total loans at June 30, 2010, and up from $72.9 million or 2.18% of period-end total loans at September 30, 2009.
Net charge-offs for the third quarter of 2010 were $7.4 million or 1.01% of average total loans, compared to $6.3 million or 0.83% of average total loans for the second quarter of 2010.
Tax-equivalent net interest income for the third quarter of 2010 was $42.6 million, down $655 thousand on a linked-quarter basis. Tax-equivalent net interest margin was 3.68% for the third quarter of 2010, down six basis points from 3.74% for the second quarter of 2010. Net interest income and margin during the third quarter of 2010 were negatively impacted by a decrease in average loans and a reduction in interest income from the interest rate hedge that was fully amortized during the third quarter.
Noninterest income for the third quarter of 2010 was $9.5 million, an increase of $965 thousand on a linked-quarter basis. This increase in noninterest income was due in part to a decrease in losses on loans classified as held for sale. During the second quarter of 2010, the Company recorded losses on loans classified as held for sale of $418 thousand. The Company did not record any losses on loans classified as held for sale during the third quarter of 2010.
Total noninterest expense for the third quarter of 2010 was $37.8 million, a decrease of $3.0 million on a linked-quarter basis. The decrease in noninterest expense was primarily due to gains from sales of other real estate owned net of carrying costs of $414 thousand recorded during the third quarter of 2010 compared to net losses and carrying costs of $1.4 million in the second quarter of 2010.
As of September 30, 2010, Sterling had total assets of $5.0 billion, total loans of $2.9 billion and total deposits of $4.1 billion. Shareholders’ equity of $627 million at September 30, 2010, was 12.4% of total assets. Book value per common share at period-end was $6.15.
Conference Call
Management of Sterling will host a conference call for investors and analysts that will be broadcast live via telephone and over the Internet on Thursday, October 28, 2010 at 11:00 a.m. Eastern Time. To participate, visit the Investor Relations section of the Company’s web site at http://www.banksterling.com or call (612) 332-0335. An audio archive of the call will also be available on the web site beginning Friday, October 29, 2010.
A telephone replay of the conference call will be available beginning Thursday, October 28, 2010 at 12:00 p.m. until Thursday, November 4, 2010 at 11:59 p.m. Central Time by dialing (800) 475-6701. The access code for the replay is 173152.
Forward-Looking Statements
This news release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve risks and uncertainties and are based on beliefs and assumptions of management at the time that this release was prepared. The Company does not assume any obligation to update the forward-looking statements. There are several factors, many beyond the Company’s control, that could cause results to differ significantly from expectations including: adverse changes in the loan portfolio and the resulting credit risk-related losses and expenses; potential inadequacy of the allowance for credit losses; the ability to maintain or improve origination volumes; competitive influences on product pricing; the ability to integrate acquisitions and realize expected cost savings and revenue enhancements; effects of changes in interest rates on net interest margin; and changes in federal and state regulations and laws. Additional factors can be found in the Company's 2009 Annual Report on Form 10-K which has been filed with the Securities and Exchange Commission and is available at the Securities and Exchange Commission’s web site (www.sec.gov).
About Sterling Bancshares
Sterling Bancshares, Inc. is a Houston-based bank holding company with total assets of $5.0 billion, which operates 56 banking centers in the greater metropolitan areas of Houston, San Antonio, Dallas and Fort Worth, Texas. The Company’s common stock is traded through the NASDAQ Global Select Market under the symbol “SBIB”. For more information on Sterling Bancshares, please visit the Company’s web site at http://www.banksterling.com.
For More Information Contact: |
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Chris Reid, Vice President and Director of Investor Relations, (713) 507-2873 |
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–Tables to follow–
STERLING BANCSHARES, INC. |
||||||||||
SELECTED FINANCIAL INFORMATION (Unaudited) |
||||||||||
(dollars in thousands, except for per share data) |
||||||||||
Quarter Ended |
Year-to-date |
|||||||||
Sep. 30, |
Jun. 30, |
Sep. 30, |
||||||||
2010 |
2010 |
2009 |
2010 |
2009 |
||||||
Profitability |
||||||||||
Net income |
$ 4,455 |
$ 596 |
$ (24,724) |
$ (1,197) |
$ (14,710) |
|||||
Net income available to common shareholders |
$ 4,455 |
$ 596 |
$ (24,724) |
$ (1,197) |
$ (24,052) |
|||||
Earnings per common share (1) |
||||||||||
Basic |
$ 0.04 |
$ 0.01 |
$ (0.30) |
$ (0.01) |
$ (0.31) |
|||||
Diluted |
$ 0.04 |
$ 0.01 |
$ (0.30) |
$ (0.01) |
$ (0.31) |
|||||
Return on average common equity (2) |
2.80% |
0.38% |
(16.98)% |
(0.26)% |
(5.77)% |
|||||
Return on average assets (2) |
0.35% |
0.05% |
(1.97)% |
(0.03)% |
(0.39)% |
|||||
Net interest margin (3) |
3.68% |
3.74% |
4.20% |
3.81% |
4.26% |
|||||
Efficiency Ratio (4): |
||||||||||
Consolidated |
72.53% |
78.77% |
69.56% |
75.86% |
68.73% |
|||||
Sterling Bank |
70.74% |
76.40% |
67.79% |
73.58% |
66.76% |
|||||
Liquidity and Capital Ratios |
||||||||||
Average loans to average deposits |
71.63% |
73.39% |
85.86% |
74.51% |
91.82% |
|||||
Period-end stockholders' equity to total assets |
12.44% |
12.30% |
11.23% |
12.44% |
11.23% |
|||||
Average stockholders' equity to average assets |
12.53% |
12.28% |
11.60% |
12.15% |
12.18% |
|||||
Period-end tangible capital to total tangible assets |
9.13% |
9.01% |
7.70% |
9.13% |
7.70% |
|||||
Tier 1 capital to risk-weighted assets |
15.23% |
14.45% |
11.20% |
15.23% |
11.20% |
|||||
Total capital to risk-weighted assets |
17.88% |
17.04% |
13.95% |
17.88% |
13.95% |
|||||
Tier 1 leverage ratio (Tier 1 capital to average assets) |
10.53% |
10.32% |
8.88% |
10.53% |
8.88% |
|||||
Other Data |
||||||||||
Shares used in computing earnings per common share |
||||||||||
Basic shares |
101,934 |
101,898 |
81,707 |
97,487 |
77,659 |
|||||
Diluted shares |
102,212 |
102,144 |
81,707 |
97,487 |
77,659 |
|||||
End of period common shares outstanding |
101,952 |
101,927 |
81,755 |
101,952 |
81,755 |
|||||
Book value per common share at period-end |
$ 6.15 |
$ 6.13 |
$ 6.67 |
$ 6.15 |
$ 6.67 |
|||||
Cash dividends paid per common share |
$ 0.015 |
$ 0.015 |
$ 0.055 |
$ 0.045 |
$ 0.165 |
|||||
Common stock dividend payout ratio |
34.35% |
256.65% |
(18.19)% |
(358.14)% |
(85.45)% |
|||||
Full-time equivalent employees |
986 |
991 |
1,013 |
986 |
1,013 |
|||||
Number of banking centers |
56 |
57 |
60 |
56 |
60 |
|||||
STERLING BANCSHARES, INC. |
||||||||||
CONSOLIDATED BALANCE SHEETS (Unaudited) |
||||||||||
(dollars in thousands) |
||||||||||
Sep. 30, |
Jun. 30, |
Mar. 31, |
Dec. 31, |
Sep. 30, |
||||||
2010 |
2010 |
2010 |
2009 |
2009 |
||||||
ASSETS |
||||||||||
Cash and cash equivalents |
$ 366,590 |
$ 359,388 |
$ 361,199 |
$ 246,215 |
$ 158,114 |
|||||
Available-for-sale securities, at fair value |
1,169,519 |
1,069,964 |
920,082 |
846,216 |
836,521 |
|||||
Held-to-maturity securities, at amortized cost |
280,215 |
280,658 |
267,503 |
222,845 |
162,990 |
|||||
Loans held for sale |
7,123 |
6,509 |
18,055 |
11,778 |
38,187 |
|||||
Loans held for investment |
2,862,952 |
2,992,370 |
3,096,261 |
3,233,273 |
3,312,520 |
|||||
Total loans |
2,870,075 |
2,998,879 |
3,114,316 |
3,245,051 |
3,350,707 |
|||||
Allowance for loan losses |
(80,754) |
(80,983) |
(76,646) |
(74,732) |
(70,059) |
|||||
Loans, net |
2,789,321 |
2,917,896 |
3,037,670 |
3,170,319 |
3,280,648 |
|||||
Premises and equipment, net |
48,507 |
47,812 |
47,396 |
48,816 |
49,128 |
|||||
Real estate acquired by foreclosure |
14,571 |
18,151 |
17,282 |
16,763 |
11,674 |
|||||
Goodwill |
173,210 |
173,210 |
173,210 |
173,210 |
173,210 |
|||||
Core deposits and other intangibles, net |
10,004 |
10,540 |
11,077 |
11,626 |
12,179 |
|||||
Accrued interest receivable |
14,356 |
14,951 |
15,462 |
16,502 |
16,142 |
|||||
Other assets |
173,328 |
183,429 |
192,498 |
184,536 |
158,912 |
|||||
TOTAL ASSETS |
$ 5,039,621 |
$ 5,075,999 |
$ 5,043,379 |
$ 4,937,048 |
$ 4,859,518 |
|||||
LIABILITIES AND SHAREHOLDERS' EQUITY |
||||||||||
LIABILITIES: |
||||||||||
Deposits: |
||||||||||
Noninterest-bearing demand |
$ 1,248,321 |
$ 1,266,781 |
$ 1,167,602 |
$ 1,144,133 |
$ 1,094,346 |
|||||
Interest-bearing demand |
2,014,207 |
1,962,854 |
2,031,399 |
2,004,539 |
1,874,746 |
|||||
Certificates and other time deposits |
840,683 |
921,495 |
925,427 |
946,279 |
1,038,362 |
|||||
Total deposits |
4,103,211 |
4,151,130 |
4,124,428 |
4,094,951 |
4,007,454 |
|||||
Other borrowed funds |
106,546 |
100,770 |
99,012 |
97,245 |
99,486 |
|||||
Subordinated debt |
78,624 |
78,247 |
77,737 |
77,338 |
77,616 |
|||||
Junior subordinated debt |
82,734 |
82,734 |
82,734 |
82,734 |
82,734 |
|||||
Accrued interest payable and other liabilities |
41,704 |
38,722 |
39,944 |
44,247 |
46,716 |
|||||
Total liabilities |
4,412,819 |
4,451,603 |
4,423,855 |
4,396,515 |
4,314,006 |
|||||
COMMITMENTS AND CONTINGENCIES |
- |
- |
- |
- |
- |
|||||
SHAREHOLDERS' EQUITY |
||||||||||
Common stock |
103,820 |
103,795 |
103,745 |
83,721 |
83,622 |
|||||
Capital surplus |
238,536 |
238,186 |
237,439 |
170,848 |
171,955 |
|||||
Retained earnings |
290,429 |
287,503 |
288,436 |
295,909 |
295,401 |
|||||
Treasury stock |
(21,399) |
(21,399) |
(21,399) |
(21,399) |
(21,399) |
|||||
Accumulated other comprehensive income, net of tax |
15,416 |
16,311 |
11,303 |
11,454 |
15,933 |
|||||
Total shareholders' equity |
626,802 |
624,396 |
619,524 |
540,533 |
545,512 |
|||||
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY |
$ 5,039,621 |
$ 5,075,999 |
$ 5,043,379 |
$ 4,937,048 |
$ 4,859,518 |
|||||
STERLING BANCSHARES, INC. |
||||||||||||||
CONSOLIDATED STATEMENTS OF INCOME (Unaudited) |
||||||||||||||
(dollars in thousands, except for per share data) |
||||||||||||||
Quarter Ended |
Year-to-date |
|||||||||||||
Sep. 30, |
Jun. 30, |
Mar. 31, |
Dec. 31, |
Sep. 30, |
||||||||||
2010 |
2010 |
2010 |
2009 |
2009 |
2010 |
2009 |
||||||||
Interest income: |
||||||||||||||
Loans, including fees |
$ 40,153 |
$ 42,087 |
$ 43,649 |
$ 46,876 |
$ 49,658 |
$ 125,889 |
$ 154,349 |
|||||||
Securities: |
||||||||||||||
Taxable |
9,841 |
9,602 |
9,117 |
9,758 |
9,286 |
28,560 |
26,659 |
|||||||
Non-taxable |
1,013 |
915 |
925 |
929 |
897 |
2,853 |
2,687 |
|||||||
Deposits in financial institutions |
157 |
231 |
115 |
90 |
64 |
503 |
64 |
|||||||
Other interest-earning assets |
1 |
3 |
1 |
19 |
29 |
5 |
61 |
|||||||
Total interest income |
51,165 |
52,838 |
53,807 |
57,672 |
59,934 |
157,810 |
183,820 |
|||||||
Interest expense: |
||||||||||||||
Demand and savings deposits |
3,583 |
4,319 |
4,212 |
4,243 |
4,403 |
12,114 |
11,781 |
|||||||
Certificates and other time deposits |
2,823 |
3,159 |
3,352 |
4,577 |
5,504 |
9,334 |
19,474 |
|||||||
Other borrowed funds |
784 |
768 |
448 |
314 |
346 |
2,000 |
1,583 |
|||||||
Subordinated debt |
747 |
705 |
687 |
713 |
748 |
2,139 |
2,612 |
|||||||
Junior subordinated debt |
1,071 |
1,040 |
1,028 |
1,045 |
1,082 |
3,139 |
3,441 |
|||||||
Total interest expense |
9,008 |
9,991 |
9,727 |
10,892 |
12,083 |
28,726 |
38,891 |
|||||||
Net interest income |
42,157 |
42,847 |
44,080 |
46,780 |
47,851 |
129,084 |
144,929 |
|||||||
Provision for credit losses |
7,716 |
9,336 |
22,936 |
11,000 |
56,131 |
39,988 |
76,631 |
|||||||
Net interest income after provision for credit losses |
34,441 |
33,511 |
21,144 |
35,780 |
(8,280) |
89,096 |
68,298 |
|||||||
Noninterest income: |
||||||||||||||
Customer service fees |
3,728 |
3,591 |
3,488 |
3,722 |
3,845 |
10,807 |
11,709 |
|||||||
Net gain (loss) on securities |
43 |
17 |
20 |
(1,823) |
4 |
80 |
17 |
|||||||
Wealth management fees |
1,733 |
2,102 |
2,098 |
2,049 |
1,862 |
5,933 |
5,904 |
|||||||
Other |
3,986 |
2,815 |
931 |
1,543 |
3,402 |
7,732 |
12,774 |
|||||||
Total noninterest income |
9,490 |
8,525 |
6,537 |
5,491 |
9,113 |
24,552 |
30,404 |
|||||||
Noninterest expense: |
||||||||||||||
Salaries and employee benefits |
20,722 |
20,453 |
20,503 |
19,496 |
21,005 |
61,678 |
67,434 |
|||||||
Occupancy |
5,566 |
5,709 |
5,790 |
5,822 |
5,967 |
17,065 |
18,004 |
|||||||
Technology |
2,267 |
2,332 |
2,417 |
2,375 |
2,495 |
7,016 |
7,475 |
|||||||
Professional fees |
1,452 |
1,372 |
2,005 |
1,283 |
1,065 |
4,829 |
3,419 |
|||||||
Postage, delivery and supplies |
661 |
719 |
708 |
685 |
700 |
2,088 |
2,181 |
|||||||
Marketing |
198 |
271 |
269 |
443 |
557 |
738 |
1,487 |
|||||||
Core deposits & other intangibles amortization |
537 |
537 |
549 |
552 |
565 |
1,623 |
1,695 |
|||||||
Acquisition costs |
- |
- |
- |
980 |
154 |
- |
154 |
|||||||
FDIC insurance assessments |
2,478 |
2,438 |
2,547 |
1,856 |
1,741 |
7,463 |
6,974 |
|||||||
Other |
3,899 |
6,975 |
4,165 |
5,998 |
5,826 |
15,039 |
14,871 |
|||||||
Total noninterest expense |
37,780 |
40,806 |
38,953 |
39,490 |
40,075 |
117,539 |
123,694 |
|||||||
Income (loss) before income taxes |
6,151 |
1,230 |
(11,272) |
1,781 |
(39,242) |
(3,891) |
(24,992) |
|||||||
Income taxes provision (benefit) |
1,696 |
634 |
(5,024) |
45 |
(14,518) |
(2,694) |
(10,282) |
|||||||
Net income (loss) |
$ 4,455 |
$ 596 |
$ (6,248) |
$ 1,736 |
$ (24,724) |
$ (1,197) |
$ (14,710) |
|||||||
Preferred stock dividends |
- |
- |
- |
- |
- |
- |
9,342 |
|||||||
Net income (loss) available to common shareholders |
$ 4,455 |
$ 596 |
$ (6,248) |
$ 1,736 |
$ (24,724) |
$ (1,197) |
$ (24,052) |
|||||||
Earnings (loss) per common share (1): |
||||||||||||||
Basic |
$ 0.04 |
$ 0.01 |
$ (0.07) |
$ 0.02 |
$ (0.30) |
$ (0.01) |
$ (0.31) |
|||||||
Diluted |
$ 0.04 |
$ 0.01 |
$ (0.07) |
$ 0.02 |
$ (0.30) |
$ (0.01) |
$ (0.31) |
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STERLING BANCSHARES, INC. |
||||||||||||
SELECTED FINANCIAL INFORMATION (Unaudited) |
||||||||||||
(dollars in thousands) |
||||||||||||
Quarter Ended |
||||||||||||
Sep. 30, |
Jun. 30, |
|||||||||||
2010 |
2010 |
|||||||||||
Average Balance |
Interest |
Yield/Rate |
Average Balance |
Interest |
Yield/Rate |
|||||||
Interest-Earning Assets: |
||||||||||||
Loans held for sale |
$ 5,390 |
$ 28 |
2.06% |
$ 11,454 |
$ 54 |
1.90% |
||||||
Loans held for investment: |
||||||||||||
Taxable |
2,930,124 |
40,122 |
5.43% |
3,036,770 |
41,994 |
5.55% |
||||||
Non-taxable (3) |
295 |
4 |
5.52% |
4,260 |
57 |
5.34% |
||||||
Securities: |
||||||||||||
Taxable |
1,286,050 |
9,841 |
3.04% |
1,125,517 |
9,602 |
3.42% |
||||||
Non-taxable (3) |
112,188 |
1,497 |
5.30% |
100,192 |
1,347 |
5.39% |
||||||
Deposits in financial institutions |
260,167 |
157 |
0.24% |
362,429 |
231 |
0.26% |
||||||
Other interest-earning assets |
566 |
1 |
0.84% |
840 |
3 |
1.27% |
||||||
Total interest-earning assets |
4,594,780 |
51,650 |
4.46% |
4,641,462 |
53,288 |
4.60% |
||||||
Noninterest-earning assets |
438,522 |
444,933 |
||||||||||
Total Assets |
$ 5,033,302 |
$ 5,086,395 |
||||||||||
Interest-Bearing Liabilities: |
||||||||||||
Deposits: |
||||||||||||
Demand and savings |
$ 2,003,914 |
$ 3,583 |
0.71% |
$ 2,027,133 |
$ 4,319 |
0.85% |
||||||
Certificates and other time |
870,041 |
2,823 |
1.29% |
934,941 |
3,159 |
1.36% |
||||||
Other borrowed funds |
103,902 |
784 |
2.99% |
100,976 |
768 |
3.05% |
||||||
Subordinated debt |
78,472 |
747 |
3.78% |
77,831 |
705 |
3.63% |
||||||
Junior subordinated debt |
82,734 |
1,071 |
5.14% |
82,734 |
1,040 |
5.04% |
||||||
Total interest-bearing liabilities |
3,139,063 |
9,008 |
1.14% |
3,223,615 |
9,991 |
1.24% |
||||||
Noninterest-bearing sources: |
||||||||||||
Noninterest-bearing liabilities |
1,263,481 |
1,238,352 |
||||||||||
Shareholders' equity |
630,758 |
624,428 |
||||||||||
Total Liabilities and Shareholders' Equity |
$ 5,033,302 |
$ 5,086,395 |
||||||||||
Tax Equivalent Net Interest Income & Margin (3) |
42,642 |
3.68% |
43,297 |
3.74% |
||||||||
Non-GAAP to GAAP Reconciliation: |
||||||||||||
Tax Equivalent adjustment: |
||||||||||||
Loans |
1 |
18 |
||||||||||
Securities |
484 |
432 |
||||||||||
Total tax equivalent adjustment |
485 |
450 |
||||||||||
Net Interest Income |
$ 42,157 |
$ 42,847 |
||||||||||
STERLING BANCSHARES, INC. |
||||||||||||
SELECTED FINANCIAL INFORMATION (Unaudited) |
||||||||||||
(dollars in thousands) |
||||||||||||
Year-to-date |
||||||||||||
2010 |
2009 |
|||||||||||
Average Balance |
Interest |
Yield/Rate |
Average Balance |
Interest |
Yield/Rate |
|||||||
Interest-Earning Assets: |
||||||||||||
Loans held for sale |
$ 10,109 |
$ 129 |
1.70% |
$ 2,064 |
$ 89 |
5.75% |
||||||
Loans held for investment: |
||||||||||||
Taxable |
3,046,899 |
125,677 |
5.51% |
3,624,478 |
154,098 |
5.68% |
||||||
Non-taxable (3) |
3,113 |
122 |
5.26% |
5,141 |
237 |
6.16% |
||||||
Securities: |
||||||||||||
Taxable |
1,138,539 |
28,560 |
3.35% |
772,386 |
26,659 |
4.61% |
||||||
Non-taxable (3) |
104,647 |
4,206 |
5.37% |
97,069 |
3,902 |
5.37% |
||||||
Deposits in financial institutions |
272,475 |
503 |
0.25% |
60,885 |
64 |
0.14% |
||||||
Other interest-earning assets |
1,268 |
5 |
1.01% |
29,336 |
61 |
0.28% |
||||||
Total interest-earning assets |
4,577,050 |
159,202 |
4.65% |
4,591,359 |
185,110 |
5.39% |
||||||
Noninterest-earning assets |
442,382 |
422,017 |
||||||||||
Total Assets |
$ 5,019,432 |
$ 5,013,376 |
||||||||||
Interest-Bearing Liabilities: |
||||||||||||
Deposits: |
||||||||||||
Demand and savings |
$ 2,008,236 |
$ 12,114 |
0.81% |
$ 1,693,613 |
$ 11,781 |
0.93% |
||||||
Certificates and other time |
909,618 |
9,334 |
1.37% |
1,137,866 |
19,474 |
2.29% |
||||||
Other borrowed funds |
101,602 |
2,000 |
2.63% |
241,653 |
1,583 |
0.88% |
||||||
Subordinated debt |
78,012 |
2,139 |
3.67% |
77,582 |
2,612 |
4.50% |
||||||
Junior subordinated debt |
82,734 |
3,139 |
5.07% |
82,734 |
3,441 |
5.56% |
||||||
Total interest-bearing liabilities |
3,180,202 |
28,726 |
1.21% |
3,233,448 |
38,891 |
1.61% |
||||||
Noninterest-bearing sources: |
||||||||||||
Noninterest-bearing liabilities |
1,229,222 |
1,169,110 |
||||||||||
Shareholders' equity |
610,008 |
610,818 |
||||||||||
Total Liabilities and Shareholders' Equity |
$ 5,019,432 |
$ 5,013,376 |
||||||||||
Tax Equivalent Net Interest Income & Margin (3) |
130,476 |
3.81% |
146,219 |
4.26% |
||||||||
Non-GAAP to GAAP Reconciliation: |
||||||||||||
Tax equivalent adjustment: |
||||||||||||
Loans |
39 |
75 |
||||||||||
Securities |
1,353 |
1,215 |
||||||||||
Total tax equivalent adjustment |
1,392 |
1,290 |
||||||||||
Net Interest Income |
$ 129,084 |
$ 144,929 |
||||||||||
STERLING BANCSHARES, INC. |
||||||||||
SELECTED FINANCIAL INFORMATION (Unaudited) |
||||||||||
(dollars in thousands) |
||||||||||
Quarter Ended |
||||||||||
Sep. 30, |
Jun. 30, |
Mar. 31, |
Dec. 31, |
Sep. 30, |
||||||
2010 |
2010 |
2010 |
2009 |
2009 |
||||||
Condensed Average Balance Sheet |
||||||||||
Loans held for sale |
$ 5,390 |
$ 11,454 |
$ 13,572 |
$ 38,844 |
$ 1,607 |
|||||
Loans held for investment |
2,930,419 |
3,041,030 |
3,181,345 |
3,262,525 |
3,472,635 |
|||||
Total loans |
2,935,809 |
3,052,484 |
3,194,917 |
3,301,369 |
3,474,242 |
|||||
Available-for-sale securities, at fair value |
1,113,780 |
953,742 |
860,466 |
897,733 |
779,792 |
|||||
Held-to-maturity securities, at amortized cost |
284,458 |
271,967 |
241,894 |
168,940 |
162,717 |
|||||
Deposits in financial institutions |
260,167 |
362,429 |
194,104 |
163,195 |
106,392 |
|||||
Other earning assets |
566 |
840 |
2,418 |
26,825 |
38,419 |
|||||
Total earning assets |
4,594,780 |
4,641,462 |
4,493,799 |
4,558,062 |
4,561,562 |
|||||
Goodwill |
173,210 |
173,210 |
173,210 |
173,210 |
173,210 |
|||||
Core deposits and other intangibles, net |
10,262 |
10,800 |
11,340 |
11,890 |
12,463 |
|||||
All other non-interest earning assets |
255,050 |
260,923 |
259,198 |
236,710 |
230,667 |
|||||
Total assets |
$ 5,033,302 |
$ 5,086,395 |
$ 4,937,547 |
$ 4,979,872 |
$ 4,977,902 |
|||||
Noninterest-bearing demand |
$ 1,224,402 |
$ 1,197,400 |
$ 1,144,754 |
$ 1,158,023 |
$ 1,124,076 |
|||||
Interest bearing deposits: |
||||||||||
Interest-bearing demand |
2,003,914 |
2,027,133 |
1,993,546 |
1,946,308 |
1,837,612 |
|||||
Jumbo certificates of deposits |
539,094 |
582,727 |
549,723 |
576,984 |
614,418 |
|||||
Regular certificates of deposit |
227,490 |
233,592 |
241,649 |
264,388 |
287,243 |
|||||
Brokered certificates of deposit |
103,457 |
118,622 |
133,101 |
166,319 |
182,852 |
|||||
Total deposits |
4,098,357 |
4,159,474 |
4,062,773 |
4,112,022 |
4,046,201 |
|||||
Other borrowed funds |
103,902 |
100,976 |
99,884 |
107,211 |
145,625 |
|||||
Subordinated debt |
78,472 |
77,831 |
77,724 |
77,824 |
77,232 |
|||||
Junior subordinated debt |
82,734 |
82,734 |
82,734 |
82,734 |
82,734 |
|||||
Accrued interest payable and other liabilities |
39,079 |
40,952 |
40,216 |
46,348 |
48,480 |
|||||
Total liabilities |
4,402,544 |
4,461,967 |
4,363,331 |
4,426,139 |
4,400,272 |
|||||
Total shareholders' equity |
630,758 |
624,428 |
574,216 |
553,733 |
577,630 |
|||||
Total liabilities and shareholders' equity |
$ 5,033,302 |
$ 5,086,395 |
$ 4,937,547 |
$ 4,979,872 |
$ 4,977,902 |
|||||
Sep. 30, |
Jun. 30, |
Mar. 31, |
Dec. 31, |
Sep. 30, |
||||||
2010 |
2010 |
2010 |
2009 |
2009 |
||||||
Period-end Loans: |
||||||||||
Loans held for sale |
$ 7,123 |
$ 6,509 |
$ 18,055 |
$ 11,778 |
$ 38,187 |
|||||
Loans held for investment: |
||||||||||
Commercial and industrial |
597,205 |
658,141 |
697,998 |
806,542 |
823,797 |
|||||
Real Estate: |
||||||||||
Commercial |
1,590,081 |
1,632,213 |
1,672,562 |
1,669,118 |
1,703,629 |
|||||
Construction and development |
268,691 |
310,689 |
330,855 |
360,444 |
394,819 |
|||||
Residential mortgage |
362,404 |
343,894 |
346,400 |
344,838 |
335,007 |
|||||
Consumer/other |
44,571 |
47,433 |
48,446 |
52,331 |
55,268 |
|||||
Loans held for investment |
2,862,952 |
2,992,370 |
3,096,261 |
3,233,273 |
3,312,520 |
|||||
Total period-end loans |
$ 2,870,075 |
$ 2,998,879 |
$ 3,114,316 |
$ 3,245,051 |
$ 3,350,707 |
|||||
Period-End Deposits: |
||||||||||
Noninterest-bearing demand |
$ 1,248,321 |
$ 1,266,781 |
$ 1,167,602 |
$ 1,144,133 |
$ 1,094,346 |
|||||
Interest-bearing demand |
2,014,207 |
1,962,854 |
2,031,399 |
2,004,539 |
1,874,746 |
|||||
Certificates and other time deposits: |
||||||||||
Jumbo |
512,178 |
587,377 |
560,093 |
549,588 |
594,590 |
|||||
Regular |
224,290 |
231,404 |
234,010 |
252,682 |
273,721 |
|||||
Brokered |
104,215 |
102,714 |
131,324 |
144,009 |
170,051 |
|||||
Total period-end deposits |
$ 4,103,211 |
$ 4,151,130 |
$ 4,124,428 |
$ 4,094,951 |
$ 4,007,454 |
|||||
STERLING BANCSHARES, INC. |
||||||||||||||
SELECTED FINANCIAL INFORMATION (Unaudited) |
||||||||||||||
(dollars in thousands) |
||||||||||||||
Quarter Ended |
Year-to-date |
|||||||||||||
Sep. 30, |
Jun. 30, |
Mar. 31, |
Dec. 31, |
Sep. 30, |
||||||||||
2010 |
2010 |
2010 |
2009 |
2009 |
2010 |
2009 |
||||||||
Allowance For Credit Losses |
||||||||||||||
Allowance for loan losses at beginning of period |
$ 80,983 |
$ 76,646 |
$ 74,732 |
$ 70,059 |
$ 53,075 |
$ 74,732 |
$ 49,177 |
|||||||
Charge-offs: |
||||||||||||||
Commercial, financial and industrial |
1,034 |
1,687 |
1,968 |
1,536 |
5,049 |
4,689 |
19,378 |
|||||||
Real estate, mortgage and construction |
7,314 |
5,786 |
20,214 |
5,448 |
32,464 |
33,314 |
35,962 |
|||||||
Consumer |
285 |
205 |
262 |
477 |
321 |
752 |
1,109 |
|||||||
Total charge-offs |
8,633 |
7,678 |
22,444 |
7,461 |
37,834 |
38,755 |
56,449 |
|||||||
Recoveries: |
||||||||||||||
Commercial, financial and industrial |
481 |
433 |
483 |
536 |
251 |
1,397 |
1,177 |
|||||||
Real estate, mortgage and construction |
633 |
845 |
821 |
488 |
23 |
2,299 |
301 |
|||||||
Consumer |
72 |
51 |
118 |
110 |
163 |
241 |
420 |
|||||||
Total Recoveries |
1,186 |
1,329 |
1,422 |
1,134 |
437 |
3,937 |
1,898 |
|||||||
Net charge-offs |
7,447 |
6,349 |
21,022 |
6,327 |
37,397 |
34,818 |
54,551 |
|||||||
Provision for loan losses |
7,218 |
10,686 |
22,936 |
11,000 |
54,381 |
40,840 |
75,433 |
|||||||
Allowance for loan losses at end of period |
$ 80,754 |
$ 80,983 |
$ 76,646 |
$ 74,732 |
$ 70,059 |
$ 80,754 |
$ 70,059 |
|||||||
Reserve for unfunded loan commitments at beginning of period |
$ 1,502 |
$ 2,852 |
$ 2,852 |
$ 2,852 |
$ 1,102 |
$ 2,852 |
$ 1,654 |
|||||||
Provision for losses on unfunded loan commitments |
498 |
(1,350) |
- |
- |
1,750 |
(852) |
1,198 |
|||||||
Reserve for unfunded loan commitments at end of period |
2,000 |
1,502 |
2,852 |
2,852 |
2,852 |
2,000 |
2,852 |
|||||||
Total allowance for credit losses |
$ 82,754 |
$ 82,485 |
$ 79,498 |
$ 77,584 |
$ 72,911 |
$ 82,754 |
$ 72,911 |
|||||||
Nonperforming Assets |
||||||||||||||
Nonperforming loans: |
||||||||||||||
Loans held for sale |
$ 1,665 |
$ 3,491 |
$ 10,883 |
$ 9,896 |
$ 29,472 |
$ 1,665 |
$ 29,472 |
|||||||
Loans held for investment |
162,096 |
162,669 |
125,025 |
92,668 |
65,515 |
162,096 |
65,515 |
|||||||
Real estate acquired by foreclosure |
14,571 |
18,151 |
17,282 |
16,763 |
11,674 |
14,571 |
11,674 |
|||||||
Other repossessed assets |
50 |
20 |
60 |
38 |
33 |
50 |
33 |
|||||||
Total nonperforming assets |
$ 178,382 |
$ 184,331 |
$ 153,250 |
$ 119,365 |
$ 106,694 |
$ 178,382 |
$ 106,694 |
|||||||
Restructured loans - accruing |
$ 17,495 |
$ 15,001 |
$ 10,675 |
$ 69,857 |
$ 45,981 |
$ 17,495 |
$ 45,981 |
|||||||
Potential problem loans |
$ 169,646 |
$ 142,123 |
$ 172,020 |
$ 187,513 |
$ 131,950 |
$ 169,646 |
$ 131,950 |
|||||||
Accruing loans 30 to 89 days past due |
$ 16,234 |
$ 19,307 |
$ 46,410 |
$ 34,243 |
$ 23,364 |
$ 16,234 |
$ 23,364 |
|||||||
Accruing loans past due 90 days or more |
$ 953 |
$ 441 |
$ 306 |
$ 41 |
$ 681 |
$ 953 |
$ 681 |
|||||||
Ratios |
||||||||||||||
Period-end allowance for credit losses to period-end loans |
2.88% |
2.75% |
2.55% |
2.39% |
2.18% |
2.88% |
2.18% |
|||||||
Period-end allowance for loan losses to period-end loans |
2.81% |
2.70% |
2.46% |
2.30% |
2.09% |
2.81% |
2.09% |
|||||||
Period-end allowance for loan losses to nonperforming loans |
49.31% |
48.74% |
56.40% |
72.86% |
73.76% |
49.31% |
73.76% |
|||||||
Nonperforming loans to period-end loans |
5.71% |
5.54% |
4.36% |
3.16% |
2.83% |
5.71% |
2.83% |
|||||||
Nonperforming assets to period-end assets |
3.54% |
3.63% |
3.04% |
2.42% |
2.20% |
3.54% |
2.20% |
|||||||
Net charge-offs to average loans (2) |
1.01% |
0.83% |
2.67% |
0.76% |
4.27% |
1.52% |
2.01% |
|||||||
STERLING BANCSHARES, INC. |
||
FOOTNOTES TO EARNINGS RELEASE |
||
(1) |
Earnings per share in each quarter is computed individually using the weighted-average number of shares |
|
outstanding during that quarter while earnings per share for the full period is computed using the |
||
weighted-average number of shares outstanding during the year. Thus, the sum for all quarters does not |
||
necessarily equal the full period earnings per share. |
||
(2) |
Interim periods annualized. |
|
(3) |
Taxable-equivalent basis assuming a 35% tax rate. The Company presents net interest income |
|
on a tax-equivalent basis. Accordingly, net interest income from tax-exempt securities and |
||
loans is presented in the net interest income results on a basis comparable to taxable securities |
||
and loans. This non-GAAP financial measure allows management to assess the comparability |
||
of net interest income arising from both taxable and tax-exempt sources. |
||
(4) |
The efficiency ratio is calculated by dividing noninterest expense less acquisition costs and a one-time |
|
severance charge by tax equivalent basis net interest income plus noninterest income less net |
||
gain (loss) on investment securities. |
||
SOURCE Sterling Bancshares, Inc.
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