EX-99 2 a6483495-ex99.htm EXHIBIT 99

Exhibit 99

Provident New York Bancorp Announces Fourth Quarter 2010 Earnings of $0.14 per Diluted Share, $0.54 per Diluted Share for Fiscal 2010

MONTEBELLO, N.Y.--(BUSINESS WIRE)--October 26, 2010--Provident New York Bancorp (NASDAQ-Global Select Market: PBNY), the parent company of Provident Bank, today announced fourth-quarter results for the fiscal year ending Sept. 30, 2010. Net income for the quarter was $5.4 million, or $0.14 per diluted share, compared to net income of $4.8 million, or $0.12 per diluted share for the linked quarter ended June 30, 2010 and net income of $5.1 million or $0.13 per diluted share for the fourth quarter of fiscal 2009. Net income for fiscal year 2010 was $20.5 million, or $0.54 per diluted share compared to $25.9 million or $0.67 per diluted share for fiscal 2009. Fiscal 2009 results reflected significant securities gains not experienced to the same extent in fiscal 2010.

President’s Comments

George Strayton, President and CEO commented, “Provident performed comparatively well in a difficult economic environment this past fiscal year. The economy’s recovery has remained sluggish, resulting in slower loan growth and a slower recovery of credit quality industry-wide. Unemployment in our market, while showing some signs of improvement, has remained relatively flat. Yet, despite the economy’s challenges, I am very pleased that in fiscal 2010, we were able to grow commercial loan balances, increase transaction account balances, and hold expenses under control. As a result, we improved operating earnings during the fiscal year. After adjusting for gains on securities and the fair value of interest rate caps, net operating income improved over the prior year primarily due to improvement in our net interest income. Net interest income continues to be driven by our ability to attract and retain core deposits, as well as our deposit cost discipline. In addition, the fiscal year showed positive results from our continued market expansion into Westchester County. As we continue to strengthen our resources in the Westchester market during the year, we expect to be able to improve on these results in fiscal 2011.”

Key items for the quarter

  • Excluding the after tax effect of securities gains and the fair value adjustment of interest rate caps, earnings were $0.10 per diluted share. This compares to $0.11 for the linked quarter and $0.11 for the fourth quarter of fiscal 2009. While we actively manage our securities portfolio as a component of our asset/liability management, we also present earnings excluding net securities gains and fair market value adjustments on interest rate caps. We believe this affords investors a better understanding of our core banking operations, and aligns more closely to the views of the investment community, which tends to adjust for more variable components of income.
  • Net interest margin on a tax equivalent basis is down 16 basis points to 3.75 percent over the linked quarter ended June 30, 2010, reflecting reduced yields on commercial loans and slowing decreases in the cost of interest-bearing deposits.
  • Net charge-offs of $2.4 million are up slightly from the linked quarter. Our provision for loan losses of $2.3 million is down from the previous quarter.
  • Non-performing loans were down slightly at $28.7 million over the linked quarter while ORE increased $589,000.
  • The Company repurchased 364,000 shares of common stock during the quarter at a cost of $3.1 million. For fiscal 2010 the Company purchased 1,515,923 million shares at a cost of $12.9 million. There are 1,234,167 shares remaining under the current repurchase authorization.

Net Interest Income and Margin

Fourth quarter fiscal 2010 compared with fourth quarter fiscal 2009

Net interest income was $23.3 million for the fourth quarter of fiscal 2010, an $853,000 increase from the same quarter of fiscal 2009 as funding costs declined at a greater pace than interest income. The net interest margin on a tax-equivalent basis was 3.75 percent for the fourth quarter of fiscal 2010, compared to 3.71 percent for the same period a year ago. The tax-equivalent yield on investments decreased 71 basis points and loan yields were down 11 basis points compared to the fourth fiscal quarter in 2009. As a result, the yield on interest-earning assets declined 30 basis points. For the same period, the cost of deposits decreased 32 basis points to 0.34 percent, and the cost of borrowings decreased by 39 basis points to 3.53 percent.

Fourth quarter fiscal 2010 compared with linked quarter ended June 30, 2010

Net interest income for the quarter ended September 30, 2010 decreased $882,000 from the linked quarter ended June 30, 2010. The tax-equivalent net interest margin decreased 16 basis points from 3.91 percent in the linked quarter. The overall yield on loans decreased 20 basis points due primarily to prepayment fees of $600,000 received in the third quarter. The yield on the investment portfolio declined 29 basis points to 3.16 percent. The overall yield on earning assets declined 20 basis points. Interest bearing deposit costs declined 3 basis points reflecting continued discipline in deposit pricing.

Full year Fiscal 2010 compared to 2009

Net interest income declined year- over- year by $536,000, primarily due to lower yields on earning assets of 48 basis points, with no change in the average cost of long-term borrowings, partially offset by declines of 52 basis points in deposit costs.

Noninterest Income

Fourth quarter fiscal 2010 compared with fourth quarter fiscal 2009

Noninterest income totaled $7.7 million for the fiscal fourth quarter, a decrease of $90,000 from the fourth quarter of fiscal 2009. The decrease was due to lower deposit service charges of $442,000 caused by lower overdraft fee income, a bank owned life insurance payment of $736,000 received in fiscal 2009, as well as the decline in the fair value of the interest rate caps. This was offset by increases in gains on sale of loans of $207,000 and securities gains of $1.3 million.

Fourth quarter fiscal 2010 compared with linked quarter ended June 30, 2010

Noninterest income increased on a linked-quarter basis, mainly due to higher securities gains in the fourth quarter of $2.0 million and lower costs related to interest rate cap of $320,000.

Full year fiscal 2010 compared to 2009

Noninterest income was $27.2 million for fiscal 2010 compared to $40.0 million for fiscal 2009. Gains on sales of securities were down $9.9 million and derivative costs were up $1.1 million in fiscal 2010.

Noninterest Expense

Fourth quarter fiscal 2010 compared with fourth quarter fiscal 2009

Noninterest expense increased 10.3 percent when compared to the fourth quarter fiscal 2009. The increase is primarily due to medical and pension expense, higher incentive costs, staffing for new offices in Westchester and Nyack, and professional fees.

Fourth quarter fiscal 2010 compared with the linked quarter ended June 30, 2010

On a quarter-to-quarter basis, noninterest expense increased 3.0 percent due to increases related to medical and pension expense and incentive costs, and occupancy expense, offset in part by declines in advertising and promotion expense.

Full year fiscal 2010 compared to 2009

Noninterest expense increased 3.7% for the year. Declines in FDIC assessments, stock-based compensation, and ATM service charges were offset by increases in employee benefits and incentives, staffing for new offices, occupancy expense primarily associated with the new offices and equipment expenses, and professional fees.

Income Taxes

The effective tax rate for the fiscal 2010 was 25 percent compared to 28 percent for fiscal 2009. The decline is mainly due to the high proportion of tax-free income from municipal securities, BOLI and insurance relative to the total levels of pre-tax income and the set up of a captive insurance company.

Credit Quality

Net charge-offs for the fourth fiscal quarter were $2.4 million compared to $2.2 million in the linked quarter and $2.5 million for the fourth fiscal quarter of 2009. Our provision was $2.25 million, decreasing our allowance for loan losses by $178,000 to $30.8 million, or 108% of non-performing loans at September 30, 2010. This compares to 111 percent at September 30, 2009. Our full year provision is $10.0 million versus $9.2 million in net charge-offs, adding $793,000 to the allowance for loan losses. Provisions for fiscal 2009 were $17.6 million versus net charge-offs of $10.7 million adding $6.9 million to the allowance for loan losses.

Substandard loans at September 30, 2010 were $130.7 million compared to $124.8 million at June 30, 2010, and $89.9 million at September 30, 2009. Special mention loans were $37.9 million compared to $36.9 million at June 30, 2010, and $47.8 million at September 30, 2009. The increase in substandard loans over the linked quarter includes one C&I loan which totaled $3.0 million. Non performing loans were $28.7 million at September 30, 2010 compared to $29.5 million at June 30, 2010 and $27.1 at September 30, 2009.

Key Balance Sheet Changes

  • Period-end total deposits increased $60.4 million compared to the previous year. We continue to see an overall increase in transaction accounts, up $65.6 million from the previous year. Business transaction accounts have increased 13.8 percent in this time frame. Decreases were seen in higher rate certificates of deposit and to a lesser extent higher rate municipal deposits. Municipal tax collection deposits (transaction accounts) were $219 million and $201 million in 2010 and 2009, respectively.
  • While overall loan demand continues to be sporadic, total loan originations during fiscal 2010 were $524.9 million, an increase of 4.7 percent over $501.2 million for fiscal 2009. Commercial loan originations increased $69.6 million over fiscal 2009 levels or 29 percent. Commercial loan balances increased by $61.1 million or 6.2 percent, while 1-4 family residential mortgages declined by $49.5 million or 10.7 percent as the Bank sold $48.2 million in the secondary market. Securities increased $57.7 million to $934.9 million over September 30, 2009 levels, as the Company continued investing cash generated by deposit inflows into medium term securities, with durations between two and five years.
  • Borrowings decreased over September 30, 2009 levels by $62.5 million as FHLBNY advances matured.

Capital and Liquidity

Provident Bank remained well-capitalized at September 30, 2010. Growth in core deposits has provided ample liquidity to reduce overall borrowings and increase available for sale securities. The Bank’s Tier 1 leverage ratio is at 8.43 percent. The Company’s tangible capital as a percent of tangible assets increased 19 basis points to 9.33 percent as of September 30, 2010, while its tangible book value per share increased to $6.96 from $6.60 at September 30, 2009. Total capital increased $3.5 million from September 30, 2009, to $431.0 million at September 30, 2010, due to a net increase of $9.2 million in the Company’s retained earnings, an increase of $1.7 million due to stock based compensation items, a $2.6 million increase in accumulated other comprehensive income, offset by a net change in treasury stock of $10.0 million.

About Provident New York Bancorp

Headquartered in Montebello, New York, Provident New York Bancorp is the parent company of Provident Bank, an independent full-service community bank. Provident Bank operates 35 branches that serve the Hudson Valley region. The Bank offers a complete line of commercial, retail and investment management services. For more information, visit the Company’s web site at www.providentbanking.com.

FORWARD-LOOKING STATEMENTS AND ASSOCIATED RISK FACTORS

In addition to historical information, this earnings release may contain forward-looking statements for purposes of applicable securities laws. Any statements contained herein that are not statements of historical fact may be deemed to be forward-looking statements. Forward-looking statements are subject to numerous assumptions, risks and uncertainties. There are a number of important factors described in documents previously filed by the Company with the Securities and Exchange Commission, and other factors that could cause the Company’s actual results to differ materially from those contemplated by such forward-looking statements. The Company undertakes no obligation to publicly release the results of any revisions to those forward-looking statements which may be made to reflect events or circumstances after the date of this release or to reflect the occurrence of unanticipated events.

Financial information contained in this release should be considered to be an estimate pending completion of the annual audit of the Company’s financial statements and the filing of the Company’s Annual Report on Form 10-K for the year ended September 30, 2010 with the Securities and Exchange Commission. While the Company is not aware of any need to revise the results disclosed in this release, accounting literature may require adverse information received by management between the date of this release and the filing of the 10-K to be reflected in the results of the fiscal year, even though the new information was received by management subsequent to the date of this release.

 

Reconciliation of Adjusted Earnings:

 
  Quarter Ended   Twelve Months Ended
September 30,   June 30, September 30,
2010   2009 2010 2010   2009
Net Income
Net Income $ 5,403 $ 5,076 $ 4,756 $ 20,492 $ 25,861
Securities gains1 (1,746 ) (968 ) (561 ) (4,844 ) (10,735 )
Fair value loss on interest rate caps1   163     -     353     657     -  
Net adjusted income $ 3,820   $ 4,108   $ 4,548   $ 16,305   $ 15,126  
 
Earnings per common share
Diluted Earnings per common share 0.14 $ 0.13 0.12 0.54 $ 0.67
Securities gains1 (0.05 ) (0.03 ) (0.01 ) (0.13 ) (0.28 )
Fair value loss on interest rate caps1   -     -     0.01     0.02     -  
Diluted adjusted earnings per common share   0.10  

*

$ 0.11  

*

  0.11  

*

$ 0.43   $ 0.39  
 
Non-interest income
Total non-interest income $ 7,714 $ 7,804 $ 5,281 $ 27,201 $ 39,953
Securities gains (2,940 ) (1,630 ) (945 ) (8,157 ) (18,076 )
Fair value loss on interest rate caps   275     -     595     1,106     -  
Adjusted non interest-income $ 5,049   $ 6,174   $ 4,931   $ 20,150   $ 21,877  
 
1After marginal tax effect 40.61%
*Rounding
 
 
Provident New York Bancorp and Subsidiaries
CONSOLIDATED CONDENSED STATEMENTS OF FINANCIAL CONDITION
(unaudited, in thousands, except share and per share data)
  September 30,   September 30,
2010 2009
Assets:
Cash and due from banks $ 90,872 $ 160,408
Total securities 934,860 877,197
Loans held for sale 5,890 1,213
Loans:
One- to four-family residential mortgage loans 411,239 460,728
Commercial real estate, commercial business 822,615 789,396
Acquisition, development and construction loans 229,463 201,611
Consumer loans 238,224 251,522
Total loans, gross 1,701,541 1,703,257
Allowance for loan losses (30,843) (30,050)
Total loans, net 1,670,698 1,673,207
Federal Home Loan Bank stock, at cost 19,572 23,177
Premises and equipment, net 43,598 40,692
Goodwill 160,861 160,861
Other amortizable intangibles 3,640 5,489
Bank owned life insurance 50,938 49,611
Other assets 40,096 30,038
Total assets $ 3,021,025 $ 3,021,893
Liabilities:
Deposits
Retail $ 139,766 $ 169,122
Commercial 277,217 236,516
Municipal 77,909 86,596
Personal NOW deposits 139,517 127,595
Business NOW deposits 34,105 36,972
Municipal NOW deposits 241,995 188,074
Total transaction accounts 910,509 844,875
Savings 427,286 357,814
Money market deposits 427,334 384,632
Certificates of deposit 377,573 494,961
Total deposits 2,142,702 2,082,282
Borrowings 363,751 430,628
Borrowings Senior Note 51,496 51,494
Mortgage escrow funds and other liabilities 32,121 30,033
Total liabilities 2,590,070 2,594,437
Stockholders’ equity 430,955 427,456
Total liabilities and stockholders’ equity $ 3,021,025 $ 3,021,893
 
Shares of common stock outstanding at period end 38,262,288 39,547,207
Book value per share $ 11.26 $ 10.81
 
 
Provident New York Bancorp and Subsidiaries
CONSOLIDATED CONDENSED STATEMENTS OF INCOME
(unaudited, in thousands, except share and per share data)
      Quarter    
Quarter Ended Ended Twelve Months Ended
September 30, June 30, September 30,
2010 2009 2010 2010 2009
Interest and dividend income:
Loans and loan fees $ 23,094 $ 23,615 $ 23,393 $ 92,542 97,149
Securities taxable 4,016 4,666 4,716 18,208 25,552
Securities non-taxable 1,941 1,841 2,037 7,774 7,520
Other earning assets   270     360   262     1,250     1,369
29,321 30,482 30,408 119,774 131,590
Interest expense:
Deposits 1,677 3,190 1,849 8,517 18,375
Borrowings   4,328     4,829   4,361     17,923     19,345
Total interest expense   6,005     8,019   6,210     26,440     37,720
Net interest income 23,316 22,463 24,198 93,334 93,870
Provision for loan losses   2,250     4,500   2,750     10,000     17,600
Net interest income after provision for loan losses 21,066 17,963 21,448 83,334 76,270
 
Non-interest income:
Deposit fees and service charges 2,695 3,137 2,796 11,228 $ 12,393
Net gain on sales of securities 2,940 1,630 945 8,157 18,076
Title insurance fees 273 337 336 1,157 1,005
Bank owned life insurance 491 1,248 503 2,044 2,755
Gain (loss) on sale of premises and equipment - - - (54 ) 517
Gain on sale of loans 422 215 45 867 961
Investment management fees 759 747 756 3,070 2,576
Fair value loss interest rate caps (275 ) - (595 ) (1,106 ) -
Other   409     490   495     1,838     1,670
Total non-interest income 7,714 7,804 5,281 27,201 39,953
 
Non-interest expense:
Compensation and benefits 11,440 9,894 11,061 43,589 39,520
Stock-based compensation plans 338 621 172 1,543 2,942
Occupancy and office operations 3,403 3,195 3,168 13,434 12,802
Advertising and promotion 675 629 1,041 3,252 3,093
Professional fees 1,208 720 1,063 4,019 3,090
Data and check processing 587 563 571 2,285 2,284
Amortization of intangible assets 432 513 452 1,849 2,185
FDIC insurance and regulatory assessments 1,033 752 927 3,675 4,257
ATM/debit card expense 347 563 164 1,601 2,115
Other   1,899     1,909   2,122     7,923     7,899
Total non-interest expense 21,362 19,359 20,741 83,170 80,187
 
Income before income tax expense 7,418 6,408 5,988 27,365 36,036
Income tax expense   2,015     1,332   1,232     6,873     10,175
Net income $ 5,403   $ 5,076 $ 4,756   $ 20,492   $ 25,861
 
Per common share:
Basic earnings $ 0.14 $ 0.13 $ 0.12 $ 0.54 $ 0.67
Diluted earnings 0.14 0.13 0.12 0.54 0.67
Dividends declared 0.06 0.06 0.06 0.24 0.24
Weighted average common shares:
Basic 37,793,860 38,405,947 38,086,535 38,161,180 38,537,881
Diluted 37,793,860 38,532,411 38,086,579 38,185,122 38,705,837
 
 
Selected Financial Condition Data:   Three Months Ended
(in thousands except share and per share data) 09/30/10   06/30/10   03/31/10   12/31/09   09/30/09

End of Period

Total assets $ 3,021,025 $ 2,963,706 $ 2,935,956 $ 2,917,789 $ 3,021,893
Loans, gross (1) 1,701,541 1,705,737 1,667,428 1,677,032 1,703,257
Securities available for sale 901,012 878,370 888,994 851,028 832,583
Securities held to maturity 33,848 40,452 43,675 46,501 44,614
Bank owned life insurance 50,938 50,447 49,945 49,448 49,611
Goodwill 160,861 160,861 160,861 160,861 160,861
Other amortizable intangibles 3,640 4,072 4,524 4,996 5,489
Other non-earning assets 83,694 85,398 87,811 88,976 70,730
Deposits 2,142,702 1,961,005 2,006,953 1,869,643 2,082,282
Borrowings 415,247 526,912 472,801 584,717 482,122
Equity 430,955 429,115 422,372 420,326 427,456

Other comprehensive income related to investment securities reflected in stockholders' equity

12,621 9,953 3,970 2,342 9,502

Average Balances

Total assets $ 2,919,961 $ 2,928,626 $ 2,918,953 $ 2,886,880 $ 2,837,511
Loans, gross:
Real estate- residential mortgage 417,584 427,801 436,967 451,894 465,472
Real estate- commercial mortgage 570,023 552,888 539,679 538,646 548,195
Real estate- Acquisition, Development & Construction 227,165 222,958 212,454 202,864 191,826
Commercial and industrial 243,691 236,275 234,356 239,698 246,590
Consumer loans 239,908 243,484 248,134 252,354 252,667
Loans total (1) 1,698,371 1,683,406 1,671,590 1,685,456 1,704,750
Securities (taxable) 655,794 693,554 694,815 626,734 576,363
Securities (non-taxable) 222,024 219,121 203,153 201,706 192,733
Total earning assets 2,578,024 2,594,264 2,581,554 2,563,965 2,511,431
Non earning assets 341,937 334,362 337,399 322,915 326,080
Non-interest bearing checking 449,666 430,387 419,389 418,961 402,643
Interest bearing NOW accounts 266,950 263,709 298,935 291,844 228,761
Total transaction accounts 716,616 694,096 718,324 710,805 631,404
Savings (including mortgage escrow funds) 424,012 413,315 380,600 372,911 386,943
Money market deposits 421,989 428,612 428,605 397,710 394,718
Certificates of deposit 415,059 467,360 446,301 477,377 494,530
Total deposits and mortgage escrow 1,977,676 2,003,383 1,973,830 1,958,803 1,907,595
Total interest bearing deposits 1,528,010 1,572,996 1,554,441 1,539,842 1,504,952
Borrowings 486,060 481,460 500,226 485,759 488,443
Equity 430,862 424,221 422,129 424,338 423,361
Selected Operating Data:

Condensed Tax Equivalent Income Statement

Interest and dividend income $ 29,321 $ 30,408 $ 29,627 $ 30,418 $ 30,482
Tax equivalent adjustment* 1,045 1,098 1,023 1,020 991
Interest expense   6,005   6,210   6,693   7,532   8,019
Net interest income (tax equivalent) 24,361 25,296 23,957 23,906 23,454
Provision for loan losses   2,250   2,750   2,500   2,500   4,500

Net interest income after provision for loan losses

22,111 22,546 21,457 21,406 18,954
Non-interest income 7,714 5,281 6,113 8,093 7,804
Non-interest expense   21,362   20,741   21,173   19,894   19,359
Income before income tax expense 8,463 7,086 6,397 9,605 7,399
Income tax expense (tax equivalent)*   3,060   2,330   2,230   3,439   2,323
Net income $ 5,403 $ 4,756 $ 4,167 $ 6,166 $ 5,076
(1) Does not reflect allowance for loan losses of $30,843, $31,021, $30,444, $29,967 and $30,050
* Tax exempt income assumed at a 35% federal rate
 
 
  Three Months Ended
09/30/10   06/30/10   03/31/10   12/31/09   09/30/09

Performance Ratios (annualized)

Return on Average Assets 0.73 % 0.65 % 0.58 % 0.85 % 0.71 %
Return on Average Equity 4.98 % 4.50 % 4.00 % 5.76 % 4.76 %
Non-Interest Income to Average Assets 1.05 % 0.72 % 0.85 % 1.11 % 1.09 %
Non-Interest Expense to Average Assets 2.90 % 2.84 % 2.94 % 2.73 % 2.71 %
Operating Efficiency Adjusted (2) 71.09 % 66.91 % 71.73 % 65.40 % 63.59 %

Analysis of Net Interest Income

Yield on Loans 5.48 % 5.68 % 5.59 % 5.61 % 5.59 %
Yield on Investment Securities- Tax Equivalent 3.16 % 3.45 % 3.45 % 3.67 % 3.87 %
Yield on Earning Assets- Tax Equivalent 4.67 % 4.87 % 4.82 % 4.86 % 4.97 %
Cost of Interest Bearing Deposits 0.44 % 0.47 % 0.57 % 0.72 % 0.84 %
Cost of Borrowings 3.53 % 3.63 % 3.64 % 3.87 % 3.92 %
Cost of Interest Bearing Liabilities 1.18 % 1.21 % 1.32 % 1.48 % 1.60 %
Net Interest Rate Spread- Tax Equivalent Basis 3.49 % 3.66 % 3.49 % 3.39 % 3.38 %
Net Interest Margin- Tax Equivalent Basis 3.75 % 3.91 % 3.76 % 3.70 % 3.71 %

Capital Information Data

Tier 1 Leverage Ratio- Bank Only 8.43 % 8.75 % 8.62 % 8.85 % 8.64 %
Tier 1 Risk-Based Capital- Bank Only 240,230 244,299 239,050 243,955 246,339
Total Risk-Based Capital- Bank Only 265,148 268,996 263,264 268,225 270,807
Tangible Capital Consolidated (3) 266,454 264,182 256,987 254,469 261,106
Tangible Capital as a % of Tangible Assets Consolidated (3) 9.33 % 9.44 % 9.28 % 9.25 % 9.14 %
Shares Outstanding 38,262,288 38,628,477 38,861,477 39,061,035 39,547,207
Shares Repurchased during qrtr(open market) 364,000 233,000 316,723 602,200 86,860
Basic weighted common shares outstanding 37,793,860 38,086,535 38,188,191 38,575,909 38,405,947
Diluted common shares outstanding 37,793,860 38,086,579 38,209,766 38,649,174 38,532,411
Basic Earnings per common share $ 0.14 0.12 0.11 $ 0.16 $ 0.13
Diluted Earnings per common share 0.14 0.12 0.11 0.16 0.13
Dividends Paid per common share 0.06 0.06 0.06 0.06 0.06
Book Value per common share 11.26 11.11 10.87 10.76 10.81
Tangible Book Value per common share (3) 6.96 6.84 6.61 6.51 6.60

Asset Quality Measurements

Non-performing loans (NPLs): non-accrual $ 21,413 21,985 21,210 $ 21,432 $ 21,909
Non-performing loans (NPLs): still accruing 5,427 7,069 6,464 5,262 4,560
Troubled Debt Restructures (NPLs): still accruing 1,837 414 416 419 674
Other Real Estate Owned 3,891 3,302 2,466 2,332 1,712
Non-performing assets (NPAs) 32,568 32,770 30,556 29,445 28,855
Net Charge-offs 2,428 2,173 2,023 2,583 2,477
Net Charge-offs as % of average loans (annualized) 0.57 % 0.52 % 0.48 % 0.61 % 0.58 %
NPLs as % of total loans 1.69 % 1.73 % 1.68 % 1.62 % 1.59 %
NPAs as % of total assets 1.08 % 1.11 % 1.04 % 1.01 % 0.95 %
Allowance for loan losses as % of NPLs 108 % 105 % 108 % 111 % 111 %
Allowance for loan losses as % of total loans     1.81 %   1.82 %   1.83 %     1.79 %     1.76 %
 

(2) The efficiency ratio represents non-interest expense divided by the sum of net interest income and non-interest income. As in the case of net interest income, generally, net interest income as utilized in calculating the efficiency ratio is typically expressed on a tax-equivalent basis. Moreover, most institutions, in calculating the efficiency ratio, also adjust both noninterest expense and noninterest income to exclude from these items (as calculated under generally accepted accounting principles) certain component elements, such as non-recurring charges, other real estate expense and amortization of intangibles (deducted from non interest expense) and security transactions and other non-recurring items (excluded from non interest income). We follow these practices.

(3) Provident Bank provides supplemental reporting of Non-GAAP tangible equity ratios as management believes this information is useful to investors. The following table shows the reconciliation of tangible equity and the tangible equity ratio:

 

09/30/10 06/30/10 03/31/10 12/31/09 09/30/09
Total Assets $ 3,021,025 2,963,706 2,935,956 $ 2,917,789 $ 3,021,893
Goodwill and other amortizable intangibles (164,501 ) (164,933 ) (165,385 ) (165,857 ) (166,350 )
Tangible Assets $ 2,856,524   2,798,773   2,770,571   $ 2,751,932   $ 2,855,543  
Stockholders' equity 430,955 429,115 422,372 420,326 427,456
Goodwill and other amortizable intangibles (164,501 ) (164,933 ) (165,385 ) (165,857 ) (166,350 )
Tangible Stockholders' equity $ 266,454   264,182   256,987   $ 254,469   $ 261,106  
Outstanding Shares 38,262,288 38,628,477 38,861,477 39,061,035 39,547,207
Tangible capital as a % of tangible assets (consolidated) 9.33 % 9.44 % 9.28 % 9.25 % 9.14 %
Tangible book value per share $ 6.96 6.84 6.61 $ 6.51 $ 6.60

CONTACT:
Provident Bank
Paul A. Maisch, EVP & Chief Financial Officer
Miranda Grimm, VP & Controller
845-369-8040