Date of Report (Date of Earliest Event Reported): October 27, 2014 | ||
HOMESTREET, INC. (Exact name of registrant as specified in its charter) | ||
Washington (State or other jurisdiction of incorporation) | 001-35424 (Commission File Number) | 91-0186600 (IRS Employer Identification No.) |
Item 2.02 | Results of Operations and Financial Condition |
Item 9.01 | Financial Statements and Exhibits |
HomeStreet, Inc. |
By: /s/ Godfrey B. Evans |
Godfrey B. Evans |
Executive Vice President, Chief Administrative |
Officer, General Counsel and Corporate Secretary |
• | Consolidated results: |
◦ | Net income was $5.4 million(1), or $0.36(1) per diluted share, for the third quarter of 2014, excluding acquisition-related expenses of $722 thousand. |
◦ | Tangible book value increased to $18.86 per share as of September 30, 2014 compared to $18.42 per share at June 30, 2014. |
◦ | Year-to-date return on average tangible equity is 8.22%. |
◦ | Net interest income was $25.3 million in the third quarter of 2014 compared to $23.1 million in the second quarter of 2014, resulting from 8.4% growth in average interest-earning assets. |
◦ | Net interest margin of 3.50% compared to 3.48% in the second quarter of 2014 and 3.41% in the third quarter of 2013. |
◦ | Deposit balances of $2.43 billion increased 15.6% from the third quarter of 2013. Transaction and savings deposits increased 24.7% and noninterest-bearing checking and savings deposits grew 102% during the same period. |
• | Segment results: |
◦ | Commercial and Consumer Banking |
▪ | Commercial and Consumer Banking segment net income was $4.0 million(1) for the quarter, excluding acquisition-related expenses. |
▪ | We opened two de novo retail deposit branches in the Seattle area during the quarter. |
▪ | Transaction and savings deposits increased to $1.77 billion, up 2.8% from $1.72 billion at June 30, 2014. Noninterest-bearing deposits increased to $271.7 million, or 11.2% of total deposits, up from $235.8 million, or 9.8% of total deposits at June 30, 2014. |
▪ | Loans held for investment increased 8.4% to $1.96 billion from $1.81 billion at June 30, 2014. New loan commitments totaled $324.0 million in the quarter, up 19.0% from $272.2 million at June 30, 2014. |
▪ | Nonperforming assets and classified assets ended the quarter at 0.87% and 1.09% of total assets, respectively, down from 1.00% and 1.24% of total assets at June 30, 2014. |
▪ | Mortgage Banking segment net income was $1.4 million for the quarter. |
▪ | We opened a net of five home loan centers in Washington, California, Idaho and Hawaii during the quarter. |
▪ | Single family mortgage interest rate lock commitments were $1.17 billion, down 2.8% from the second quarter of 2014 and up 48.5% from the third quarter of 2013. |
▪ | Single family mortgage closed loan volume was $1.29 billion, up 17.6% from the second quarter of 2014 and up 9.1% from the third quarter of 2013. |
▪ | The portfolio of single family loans serviced for others increased to $10.59 billion at quarter-end, up 7.1% from $9.90 billion at June 30, 2014. |
(1) | Net of acquisition-related expenses as explained on page 6. |
Sept. 30, 2014* | Dec. 31, 2013 | Sept. 30, 2013 | Well-capitalized ratios | |||||||||
Tier 1 leverage capital (to average assets) | 9.63 | % | 9.96 | % | 10.85 | % | 5.00 | % | ||||
Tier 1 risk-based capital (to risk-weighted assets) | 13.03 | % | 14.12 | % | 17.19 | % | 6.00 | % | ||||
Total risk-based capital (to risk-weighted assets) | 13.95 | % | 15.28 | % | 18.44 | % | 10.00 | % |
* | Regulatory capital ratios at September 30, 2014 are preliminary. |
(1) | The press release contains certain non-GAAP financial disclosures for consolidated net income excluding acquisition-related expenses, diluted earnings per share, excluding acquisition-related expenses, and Commercial and Consumer Banking segment net income, excluding acquisition-related expenses. The Company uses certain non-GAAP financial measures to provide meaningful supplemental information regarding the Company's operational performance and to enhance investors' overall understanding of such financial performance. For corresponding reconciliations to GAAP financial measures, see Non-GAAP Financial Measures beginning on page 28 of this earnings release. |
Contact: | Investor Relations & Media: | |
HomeStreet, Inc. | ||
Terri Silver, 206-389-6303 | ||
terri.silver@homestreet.com | ||
http://ir.homestreet.com |
Quarter Ended | Nine Months Ended | |||||||||||||||||||||||||||
(dollars in thousands, except share data) | Sept. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sept. 30, 2013 | Sept. 30, 2014 | Sept. 30, 2013 | |||||||||||||||||||||
Income statement data (for the period ended): | ||||||||||||||||||||||||||||
Net interest income | $ | 25,308 | $ | 23,147 | $ | 22,712 | $ | 21,382 | $ | 20,412 | $ | 71,167 | $ | 53,062 | ||||||||||||||
Provision (reversal of provision) for loan losses | — | — | (1,500 | ) | — | (1,500 | ) | (1,500 | ) | 900 | ||||||||||||||||||
Noninterest income | 45,813 | 53,650 | 34,707 | 36,072 | 38,174 | 134,170 | 154,673 | |||||||||||||||||||||
Noninterest expense | 64,158 | 62,971 | 56,091 | 58,868 | 58,116 | 183,220 | 170,627 | |||||||||||||||||||||
Acquisition-related expenses (included in noninterest expense) | 722 | 606 | 838 | 4,080 | 463 | 2,166 | 469 | |||||||||||||||||||||
Net income (loss) before taxes | 6,963 | 13,826 | 2,828 | (1,414 | ) | 1,970 | 23,617 | 36,208 | ||||||||||||||||||||
Income tax expense (benefit) | 1,988 | 4,464 | 527 | (553 | ) | 308 | 6,979 | 11,538 | ||||||||||||||||||||
Net income (loss) | $ | 4,975 | $ | 9,362 | $ | 2,301 | $ | (861 | ) | $ | 1,662 | $ | 16,638 | $ | 24,670 | |||||||||||||
Basic earnings (loss) per common share | $ | 0.34 | $ | 0.63 | $ | 0.16 | $ | (0.06 | ) | $ | 0.12 | $ | 1.12 | $ | 1.72 | |||||||||||||
Diluted earnings (loss) per common share | $ | 0.33 | $ | 0.63 | $ | 0.15 | $ | (0.06 | ) | $ | 0.11 | $ | 1.11 | $ | 1.67 | |||||||||||||
Common shares outstanding | 14,852,971 | 14,849,692 | 14,846,519 | 14,799,991 | 14,422,354 | 14,852,971 | 14,422,354 | |||||||||||||||||||||
Weighted average common shares | ||||||||||||||||||||||||||||
Basic | 14,805,780 | 14,800,853 | 14,784,424 | 14,523,405 | 14,388,559 | 14,797,019 | 14,374,943 | |||||||||||||||||||||
Diluted | 14,968,238 | 14,954,998 | 14,947,864 | 14,523,405 | 14,790,671 | 14,957,034 | 14,793,427 | |||||||||||||||||||||
Dividends per share | $ | — | $ | — | $ | 0.11 | $ | 0.11 | $ | 0.11 | $ | 0.11 | $ | 0.22 | ||||||||||||||
Book value per share | $ | 19.83 | $ | 19.41 | $ | 18.42 | $ | 17.97 | $ | 18.60 | $ | 19.83 | $ | 18.60 | ||||||||||||||
Tangible book value per share (1) | $ | 18.86 | $ | 18.42 | $ | 17.47 | $ | 17.00 | $ | 18.57 | $ | 18.86 | $ | 18.57 | ||||||||||||||
Financial position (at period end): | ||||||||||||||||||||||||||||
Cash and cash equivalents | $ | 34,687 | $ | 74,991 | $ | 47,714 | $ | 33,908 | $ | 37,906 | $ | 34,687 | $ | 37,906 | ||||||||||||||
Investment securities | 449,948 | 454,966 | 446,639 | 498,816 | 574,894 | 449,948 | 574,894 | |||||||||||||||||||||
Loans held for sale | 698,111 | 549,440 | 588,465 | 279,941 | 385,110 | 698,111 | 385,110 | |||||||||||||||||||||
Loans held for investment, net | 1,964,762 | 1,812,895 | 1,662,623 | 1,871,813 | 1,510,169 | 1,964,762 | 1,510,169 | |||||||||||||||||||||
Mortgage servicing rights | 124,593 | 117,991 | 158,741 | 162,463 | 146,300 | 124,593 | 146,300 | |||||||||||||||||||||
Other real estate owned | 10,478 | 11,083 | 12,089 | 12,911 | 12,266 | 10,478 | 12,266 | |||||||||||||||||||||
Total assets | 3,474,656 | 3,235,676 | 3,124,812 | 3,066,054 | 2,854,323 | 3,474,656 | 2,854,323 | |||||||||||||||||||||
Deposits | 2,425,458 | 2,417,712 | 2,371,358 | 2,210,821 | 2,098,076 | 2,425,458 | 2,098,076 | |||||||||||||||||||||
FHLB advances | 598,590 | 384,090 | 346,590 | 446,590 | 338,690 | 598,590 | 338,690 | |||||||||||||||||||||
Repurchase agreements | 14,225 | 14,681 | — | — | — | 14,225 | — | |||||||||||||||||||||
Shareholders’ equity | 294,568 | 288,249 | 273,510 | 265,926 | 268,208 | 294,568 | 268,208 | |||||||||||||||||||||
Financial position (averages): | ||||||||||||||||||||||||||||
Investment securities | $ | 457,545 | $ | 447,458 | $ | 477,384 | $ | 565,869 | $ | 556,862 | $ | 460,723 | $ | 497,857 | ||||||||||||||
Loans held for investment | 1,917,503 | 1,766,788 | 1,830,330 | 1,732,955 | 1,475,011 | 1,838,526 | 1,406,582 | |||||||||||||||||||||
Total interest-earning assets | 2,952,916 | 2,723,687 | 2,654,078 | 2,624,287 | 2,474,397 | 2,777,988 | 2,347,560 | |||||||||||||||||||||
Total interest-bearing deposits | 1,861,164 | 1,900,681 | 1,880,358 | 1,662,180 | 1,488,076 | 1,880,664 | 1,519,615 | |||||||||||||||||||||
FHLB advances | 442,409 | 350,271 | 323,832 | 343,366 | 374,682 | 372,605 | 277,192 | |||||||||||||||||||||
Repurchase agreements | 11,149 | 1,129 | — | — | — | 4,134 | 3,638 | |||||||||||||||||||||
Total interest-bearing liabilities | 2,376,579 | 2,313,937 | 2,267,904 | 2,232,456 | 2,045,155 | 2,319,872 | 1,906,023 | |||||||||||||||||||||
Shareholders’ equity | 295,229 | 284,365 | 272,596 | 268,328 | 271,286 | 284,146 | 275,463 |
Quarter Ended | Nine Months Ended | ||||||||||||||||||||||||||||
(dollars in thousands, except share data) | Sept. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sept. 30, 2013 | Sept. 30, 2014 | Sept. 30, 2013 | ||||||||||||||||||||||
Financial performance: | |||||||||||||||||||||||||||||
Return on average shareholders’ equity (2) | 6.74 | % | 13.17 | % | 3.38 | % | (1.28 | )% | 2.45 | % | 7.81 | % | 11.94 | % | |||||||||||||||
Return on average tangible shareholders' equity(1) | 7.09 | % | 13.85 | % | 3.56 | % | (1.33 | )% | 2.45 | % | 8.22 | % | 11.96 | % | |||||||||||||||
Return on average assets | 0.61 | % | 1.22 | % | 0.30 | % | (0.12 | )% | 0.24 | % | 0.71 | % | 1.25 | % | |||||||||||||||
Net interest margin (3) | 3.50 | % | 3.48 | % | 3.51 | % | 3.34 | % | 3.41 | % | 3.50 | % | 3.12 | % | (4) | ||||||||||||||
Efficiency ratio (5) | 90.21 | % | 82.00 | % | 97.69 | % | 102.46 | % | 99.20 | % | 89.23 | % | 82.14 | % | |||||||||||||||
Asset quality: | |||||||||||||||||||||||||||||
Allowance for credit losses | $ | 22,111 | $ | 22,168 | $ | 22,317 | $ | 24,089 | $ | 24,894 | $ | 22,111 | $ | 24,894 | |||||||||||||||
Allowance for loan losses/total loans | 1.10 | % | (6) | 1.19 | % | (6) | 1.31 | % | (6) | 1.26 | % | (6) | 1.61 | % | 1.10 | % | (6) | 1.61 | % | ||||||||||
Allowance for loan losses/nonaccrual loans | 109.75 | % | 103.44 | % | 96.95 | % | 93.00 | % | 92.30 | % | 109.75 | % | 92.30 | % | |||||||||||||||
Total classified assets | $ | 38,014 | $ | 40,178 | $ | 46,937 | $ | 50,600 | $ | 54,355 | $ | 38,014 | $ | 54,355 | |||||||||||||||
Classified assets/total assets | 1.09 | % | 1.24 | % | 1.50 | % | 1.65 | % | 1.90 | % | 1.09 | % | 1.90 | % | |||||||||||||||
Total nonaccrual loans(7) | $ | 19,906 | (8) | $ | 21,197 | (8) | $ | 22,823 | (8) | $ | 25,707 | (8) | $ | 26,753 | $ | 19,906 | (8) | $ | 26,753 | ||||||||||
Nonaccrual loans/total loans | 1.00 | % | 1.16 | % | 1.35 | % | 1.36 | % | 1.74 | % | 1.00 | % | 1.74 | % | |||||||||||||||
Other real estate owned | $ | 10,478 | $ | 11,083 | $ | 12,089 | $ | 12,911 | $ | 12,266 | $ | 10,478 | $ | 12,266 | |||||||||||||||
Total nonperforming assets | $ | 30,384 | (8) | $ | 32,280 | (8) | $ | 34,912 | (8) | $ | 38,618 | (8) | $ | 39,019 | $ | 30,384 | (8) | $ | 39,019 | ||||||||||
Nonperforming assets/total assets | 0.87 | % | 1.00 | % | 1.12 | % | 1.26 | % | 1.37 | % | 0.87 | % | 1.37 | % | |||||||||||||||
Net charge-offs | $ | 57 | $ | 149 | $ | 272 | $ | 805 | $ | 1,464 | $ | 478 | $ | 3,757 | |||||||||||||||
Regulatory capital ratios for the Bank: | |||||||||||||||||||||||||||||
Tier 1 leverage capital (to average assets) | 9.63 | % | (9) | 10.17 | % | 9.94 | % | 9.96 | % | 10.85 | % | 9.63 | % | (9) | 10.85 | % | |||||||||||||
Tier 1 risk-based capital (to risk-weighted assets) | 13.03 | % | (9) | 13.84 | % | 13.99 | % | 14.12 | % | 17.19 | % | 13.03 | % | (9) | 17.19 | % | |||||||||||||
Total risk-based capital (to risk-weighted assets) | 13.95 | % | (9) | 14.84 | % | 15.04 | % | 15.28 | % | 18.44 | % | 13.95 | % | (9) | 18.44 | % | |||||||||||||
Other data: | |||||||||||||||||||||||||||||
Full-time equivalent employees (ending) | 1,598 | 1,546 | 1,491 | 1,502 | 1,426 | 1,598 | 1,426 |
(1) | Tangible equity ratios and tangible book value per share of common stock are non-GAAP financial measures. Other companies may define or calculate these measures differently. Tangible book value is calculated by dividing shareholders' common equity less average goodwill and intangible assets, net (excluding MSRs) by the number of common shares outstanding. The return on average tangible shareholders' equity is calculated by dividing net earnings available to common shareholders (annualized) by average shareholders' common equity less average goodwill and intangible assets, net (excluding MSRs). For additional information on these ratios and for corresponding reconciliations to GAAP financial measures, see Non-GAAP Financial Measures in this earnings release. |
(2) | Net earnings available to common shareholders (annualized) divided by average shareholders’ equity. |
(3) | Net interest income divided by total average interest-earning assets on a tax equivalent basis. |
(4) | Net interest margin for the first quarter of 2013 included $1.4 million in interest expense related to the correction of the cumulative effect of an error in prior years, resulting from the under accrual of interest due on the TruPS for which the Company had deferred the payment of interest. Excluding the impact of the prior period interest expense correction, the net interest margin was 3.21% for the nine months ended September 30, 2013. |
(5) | Noninterest expense divided by total net revenue (net interest income and noninterest income). |
(6) | Includes loans acquired with bank acquisitions. Excluding acquired loans, allowance for loan losses /total loans was 1.18%, 1.31%, 1.46% and 1.40% at September 30, 2014, June 30, 2014, March 31, 2014 and December 31, 2013, respectively. |
(7) | Generally, loans are placed on nonaccrual status when they are 90 or more days past due. |
(8) | Includes $6.3 million, $6.5 million, $6.6 million and $6.5 million of nonperforming loans at September 30, 2014, June 30, 2014, March 31, 2014 and December 31, 2013, respectively, that are guaranteed by the SBA. |
(9) | Regulatory capital ratios at September 30, 2014 are preliminary. |
Three Months Ended September 30, | % | Nine Months Ended September 30, | % | |||||||||||||||||||
(in thousands, except share data) | 2014 | 2013 | Change | 2014 | 2013 | Change | ||||||||||||||||
Interest income: | ||||||||||||||||||||||
Loans | $ | 25,763 | $ | 19,425 | 33 | % | $ | 71,865 | $ | 54,920 | 31 | % | ||||||||||
Investment securities | 2,565 | 3,895 | (34 | ) | 8,199 | 9,552 | (14 | ) | ||||||||||||||
Other | 150 | 28 | 436 | 449 | 82 | 448 | ||||||||||||||||
28,478 | 23,348 | 22 | 80,513 | 64,554 | 25 | |||||||||||||||||
Interest expense: | ||||||||||||||||||||||
Deposits | 2,364 | 2,222 | 6 | 7,080 | 8,078 | (12 | ) | |||||||||||||||
Federal Home Loan Bank advances | 509 | 434 | 17 | 1,366 | 1,113 | 23 | ||||||||||||||||
Securities sold under agreements to repurchase | 6 | — | NM | 7 | 11 | (36 | ) | |||||||||||||||
Long-term debt | 271 | 274 | (1 | ) | 851 | 2,274 | (63 | ) | ||||||||||||||
Other | 20 | 6 | 233 | 42 | 16 | 163 | ||||||||||||||||
3,170 | 2,936 | 8 | 9,346 | 11,492 | (19 | ) | ||||||||||||||||
Net interest income | 25,308 | 20,412 | 24 | 71,167 | 53,062 | 34 | ||||||||||||||||
Provision (reversal of provision) for credit losses | — | (1,500 | ) | NM | (1,500 | ) | 900 | NM | ||||||||||||||
Net interest income after provision for credit losses | 25,308 | 21,912 | 15 | 72,667 | 52,162 | 39 | ||||||||||||||||
Noninterest income: | ||||||||||||||||||||||
Net gain on mortgage loan origination and sale activities | 37,642 | 33,491 | 12 | 104,946 | 139,870 | (25 | ) | |||||||||||||||
Mortgage servicing income | 6,155 | 4,011 | 53 | 24,284 | 9,265 | 162 | ||||||||||||||||
(Loss) income from WMS Series LLC | (122 | ) | (550 | ) | (78 | ) | (69 | ) | 1,063 | NM | ||||||||||||
Gain (loss) on debt extinguishment | 2 | — | NM | (573 | ) | — | NM | |||||||||||||||
Depositor and other retail banking fees | 944 | 791 | 19 | 2,676 | 2,273 | 18 | ||||||||||||||||
Insurance agency commissions | 256 | 242 | 6 | 892 | 612 | 46 | ||||||||||||||||
Gain (loss) on sale of investment securities available for sale | 480 | (184 | ) | NM | 1,173 | 6 | NM | |||||||||||||||
Other | 456 | 373 | 22 | 841 | 1,584 | (47 | ) | |||||||||||||||
45,813 | 38,174 | 20 | 134,170 | 154,673 | (13 | ) | ||||||||||||||||
Noninterest expense: | ||||||||||||||||||||||
Salaries and related costs | 42,604 | 39,689 | 7 | 118,681 | 113,330 | 5 | ||||||||||||||||
General and administrative | 10,326 | 9,234 | 12 | 31,593 | 30,434 | 4 | ||||||||||||||||
Legal | 630 | 844 | (25 | ) | 1,571 | 2,054 | (24 | ) | ||||||||||||||
Consulting | 628 | 884 | (29 | ) | 2,182 | 2,343 | (7 | ) | ||||||||||||||
Federal Deposit Insurance Corporation assessments | 682 | 227 | 200 | 1,874 | 937 | 100 | ||||||||||||||||
Occupancy | 4,935 | 3,484 | 42 | 14,042 | 9,667 | 45 | ||||||||||||||||
Information services | 4,220 | 3,552 | 19 | 13,597 | 10,122 | 34 | ||||||||||||||||
Net cost of operation and sale of other real estate owned | 133 | 202 | (34 | ) | (320 | ) | 1,740 | NM | ||||||||||||||
64,158 | 58,116 | 10 | 183,220 | 170,627 | 7 | |||||||||||||||||
Income before income taxes | 6,963 | 1,970 | 253 | 23,617 | 36,208 | (35 | ) | |||||||||||||||
Income tax expense | 1,988 | 308 | 545 | 6,979 | 11,538 | (40 | ) | |||||||||||||||
NET INCOME | $ | 4,975 | $ | 1,662 | 199 | $ | 16,638 | $ | 24,670 | (33 | ) | |||||||||||
Basic income per share | $ | 0.34 | $ | 0.12 | 183 | $ | 1.12 | $ | 1.72 | (35 | ) | |||||||||||
Diluted income per share | $ | 0.33 | $ | 0.11 | 200 | $ | 1.11 | $ | 1.67 | (34 | ) | |||||||||||
Basic weighted average number of shares outstanding | 14,805,780 | 14,388,559 | 3 | 14,797,019 | 14,374,943 | 3 | ||||||||||||||||
Diluted weighted average number of shares outstanding | 14,968,238 | 14,790,671 | 1 | 14,957,034 | 14,793,427 | 1 |
Quarter ended | ||||||||||||||||||||
(in thousands, except share data) | Sept. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sept. 30, 2013 | |||||||||||||||
Interest income: | ||||||||||||||||||||
Loans | $ | 25,763 | $ | 23,419 | $ | 22,683 | $ | 21,522 | $ | 19,425 | ||||||||||
Investment securities | 2,565 | 2,664 | 2,970 | 2,839 | 3,895 | |||||||||||||||
Other | 150 | 142 | 157 | 61 | 28 | |||||||||||||||
28,478 | 26,225 | 25,810 | 24,422 | 23,348 | ||||||||||||||||
Interest expense: | ||||||||||||||||||||
Deposits | 2,364 | 2,356 | 2,360 | 2,338 | 2,222 | |||||||||||||||
Federal Home Loan Bank advances | 509 | 444 | 413 | 419 | 434 | |||||||||||||||
Securities sold under agreements to repurchase | 6 | 1 | — | — | — | |||||||||||||||
Long-term debt | 271 | 265 | 315 | 272 | 274 | |||||||||||||||
Other | 20 | 12 | 10 | 11 | 6 | |||||||||||||||
3,170 | 3,078 | 3,098 | 3,040 | 2,936 | ||||||||||||||||
Net interest income | 25,308 | 23,147 | 22,712 | 21,382 | 20,412 | |||||||||||||||
Provision (reversal of provision) for credit losses | — | — | (1,500 | ) | — | (1,500 | ) | |||||||||||||
Net interest income after provision for credit losses | 25,308 | 23,147 | 24,212 | 21,382 | 21,912 | |||||||||||||||
Noninterest income: | ||||||||||||||||||||
Net gain on mortgage loan origination and sale activities | 37,642 | 41,794 | 25,510 | 24,842 | 33,491 | |||||||||||||||
Mortgage servicing income | 6,155 | 10,184 | 7,945 | 7,807 | 4,011 | |||||||||||||||
(Loss) income from WMS Series LLC | (122 | ) | 246 | (193 | ) | (359 | ) | (550 | ) | |||||||||||
Gain (loss) on debt extinguishment | 2 | 11 | (586 | ) | — | — | ||||||||||||||
Depositor and other retail banking fees | 944 | 917 | 815 | 899 | 791 | |||||||||||||||
Insurance agency commissions | 256 | 232 | 404 | 252 | 242 | |||||||||||||||
Gain (loss) on sale of investment securities available for sale | 480 | (20 | ) | 713 | 1,766 | (184 | ) | |||||||||||||
Other | 456 | 286 | 99 | 865 | 373 | |||||||||||||||
45,813 | 53,650 | 34,707 | 36,072 | 38,174 | ||||||||||||||||
Noninterest expense: | ||||||||||||||||||||
Salaries and related costs | 42,604 | 40,606 | 35,471 | 36,110 | 39,689 | |||||||||||||||
General and administrative | 10,326 | 11,145 | 10,122 | 9,932 | 9,234 | |||||||||||||||
Legal | 630 | 542 | 399 | 498 | 844 | |||||||||||||||
Consulting | 628 | 603 | 951 | 3,294 | 884 | |||||||||||||||
Federal Deposit Insurance Corporation assessments | 682 | 572 | 620 | 496 | 227 | |||||||||||||||
Occupancy | 4,935 | 4,675 | 4,432 | 4,098 | 3,484 | |||||||||||||||
Information services | 4,220 | 4,862 | 4,515 | 4,369 | 3,552 | |||||||||||||||
Net cost of operation and sale of other real estate owned | 133 | (34 | ) | (419 | ) | 71 | 202 | |||||||||||||
64,158 | 62,971 | 56,091 | 58,868 | 58,116 | ||||||||||||||||
Income (loss) before income tax expense | 6,963 | 13,826 | 2,828 | (1,414 | ) | 1,970 | ||||||||||||||
Income tax expense (benefit) | 1,988 | 4,464 | 527 | (553 | ) | 308 | ||||||||||||||
NET INCOME (LOSS) | $ | 4,975 | $ | 9,362 | $ | 2,301 | $ | (861 | ) | $ | 1,662 | |||||||||
Basic income (loss) per share | $ | 0.34 | $ | 0.63 | $ | 0.16 | $ | (0.06 | ) | $ | 0.12 | |||||||||
Diluted income (loss) per share | $ | 0.33 | $ | 0.63 | $ | 0.15 | $ | (0.06 | ) | $ | 0.11 | |||||||||
Basic weighted average number of shares outstanding | 14,805,780 | 14,800,853 | 14,784,424 | 14,523,405 | 14,388,559 | |||||||||||||||
Diluted weighted average number of shares outstanding | 14,968,238 | 14,954,998 | 14,947,864 | 14,523,405 | 14,790,671 |
(in thousands, except share data) | Sept. 30, 2014 | Dec. 31, 2013 | % Change | ||||||||
Assets: | |||||||||||
Cash and cash equivalents (including interest-bearing instruments of $16,044 and $9,436) | $ | 34,687 | $ | 33,908 | 2 | % | |||||
Investment securities (includes $432,096 and $481,683 carried at fair value) | 449,948 | 498,816 | (10 | ) | |||||||
Loans held for sale (includes $613,448 and $279,385 carried at fair value) | 698,111 | 279,941 | 149 | ||||||||
Loans held for investment (net of allowance for loan losses of $21,847 and $23,908) | 1,964,762 | 1,871,813 | 5 | ||||||||
Mortgage servicing rights (includes $115,477 and $153,128 carried at fair value) | 124,593 | 162,463 | (23 | ) | |||||||
Other real estate owned | 10,478 | 12,911 | (19 | ) | |||||||
Federal Home Loan Bank stock, at cost | 34,271 | 35,288 | (3 | ) | |||||||
Premises and equipment, net | 44,476 | 36,612 | 21 | ||||||||
Goodwill | 11,945 | 12,063 | (1 | ) | |||||||
Other assets | 101,385 | 122,239 | (17 | ) | |||||||
Total assets | $ | 3,474,656 | $ | 3,066,054 | 13 | ||||||
Liabilities and shareholders’ equity: | |||||||||||
Liabilities: | |||||||||||
Deposits | $ | 2,425,458 | $ | 2,210,821 | 10 | ||||||
Federal Home Loan Bank advances | 598,590 | 446,590 | 34 | ||||||||
Securities sold under agreements to repurchase | 14,225 | — | NM | ||||||||
Accounts payable and other liabilities | 79,958 | 77,906 | 3 | ||||||||
Long-term debt | 61,857 | 64,811 | (5 | ) | |||||||
Total liabilities | 3,180,088 | 2,800,128 | 14 | ||||||||
Shareholders’ equity: | |||||||||||
Preferred stock, no par value | |||||||||||
Authorized 10,000 shares | |||||||||||
Issued and outstanding, 0 shares and 0 shares | — | — | — | ||||||||
Common stock, no par value | |||||||||||
Authorized 160,000,000 | |||||||||||
Issued and outstanding, 14,852,971 shares and 14,799,991 shares | 511 | 511 | — | ||||||||
Additional paid-in capital | 96,650 | 94,474 | 2 | ||||||||
Retained earnings | 197,945 | 182,935 | 8 | ||||||||
Accumulated other comprehensive loss | (538 | ) | (11,994 | ) | (96 | ) | |||||
Total shareholders’ equity | 294,568 | 265,926 | 11 | ||||||||
Total liabilities and shareholders’ equity | $ | 3,474,656 | $ | 3,066,054 | 13 |
(in thousands, except share data) | Sept. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sept. 30, 2013 | |||||||||||||||
Assets: | ||||||||||||||||||||
Cash and cash equivalents | $ | 34,687 | $ | 74,991 | $ | 47,714 | $ | 33,908 | $ | 37,906 | ||||||||||
Investment securities | 449,948 | 454,966 | 446,639 | 498,816 | 574,894 | |||||||||||||||
Loans held for sale | 698,111 | 549,440 | 588,465 | 279,941 | 385,110 | |||||||||||||||
Loans held for investment, net | 1,964,762 | 1,812,895 | 1,662,623 | 1,871,813 | 1,510,169 | |||||||||||||||
Mortgage servicing rights | 124,593 | 117,991 | 158,741 | 162,463 | 146,300 | |||||||||||||||
Other real estate owned | 10,478 | 11,083 | 12,089 | 12,911 | 12,266 | |||||||||||||||
Federal Home Loan Bank stock, at cost | 34,271 | 34,618 | 34,958 | 35,288 | 35,370 | |||||||||||||||
Premises and equipment, net | 44,476 | 43,896 | 40,894 | 36,612 | 24,684 | |||||||||||||||
Goodwill | 11,945 | 11,945 | 12,063 | 12,063 | 424 | |||||||||||||||
Other assets | 101,385 | 123,851 | 120,626 | 122,239 | 127,200 | |||||||||||||||
Total assets | $ | 3,474,656 | $ | 3,235,676 | $ | 3,124,812 | $ | 3,066,054 | $ | 2,854,323 | ||||||||||
Liabilities and shareholders’ equity: | ||||||||||||||||||||
Liabilities: | ||||||||||||||||||||
Deposits | $ | 2,425,458 | $ | 2,417,712 | $ | 2,371,358 | $ | 2,210,821 | $ | 2,098,076 | ||||||||||
Federal Home Loan Bank advances | 598,590 | 384,090 | 346,590 | 446,590 | 338,690 | |||||||||||||||
Securities sold under agreements to repurchase | 14,225 | 14,681 | — | — | — | |||||||||||||||
Accounts payable and other liabilities | 79,958 | 69,087 | 71,498 | 77,906 | 87,492 | |||||||||||||||
Long-term debt | 61,857 | 61,857 | 61,856 | 64,811 | 61,857 | |||||||||||||||
Total liabilities | 3,180,088 | 2,947,427 | 2,851,302 | 2,800,128 | 2,586,115 | |||||||||||||||
Shareholders’ equity: | ||||||||||||||||||||
Preferred stock, no par value | ||||||||||||||||||||
Authorized 10,000 shares | — | — | — | — | — | |||||||||||||||
Common stock, no par value | ||||||||||||||||||||
Authorized 160,000,000 | 511 | 511 | 511 | 511 | 511 | |||||||||||||||
Additional paid-in capital | 96,650 | 95,923 | 95,271 | 94,474 | 91,415 | |||||||||||||||
Retained earnings | 197,945 | 192,972 | 183,610 | 182,935 | 185,379 | |||||||||||||||
Accumulated other comprehensive (loss) income | (538 | ) | (1,157 | ) | (5,882 | ) | (11,994 | ) | (9,097 | ) | ||||||||||
Total shareholders’ equity | 294,568 | 288,249 | 273,510 | 265,926 | 268,208 | |||||||||||||||
Total liabilities and shareholders’ equity | $ | 3,474,656 | $ | 3,235,676 | $ | 3,124,812 | $ | 3,066,054 | $ | 2,854,323 |
Quarter Ended September 30, | ||||||||||||||||||||||
2014 | 2013 | |||||||||||||||||||||
(in thousands) | Average Balance | Interest | Average Yield/Cost | Average Balance | Interest | Average Yield/Cost | ||||||||||||||||
Assets: | ||||||||||||||||||||||
Interest-earning assets: (1) | ||||||||||||||||||||||
Cash and cash equivalents | $ | 27,631 | $ | 13 | 0.19 | % | $ | 37,671 | $ | 17 | 0.24 | % | ||||||||||
Investment securities | 457,545 | 3,141 | 2.72 | % | 556,862 | 4,452 | 3.20 | % | ||||||||||||||
Loans held for sale | 550,237 | 5,393 | 3.89 | % | 404,853 | 4,004 | 3.96 | % | ||||||||||||||
Loans held for investment | 1,917,503 | 20,402 | 4.22 | % | 1,475,011 | 15,453 | 4.18 | % | ||||||||||||||
Total interest-earning assets | 2,952,916 | 28,949 | 3.89 | % | 2,474,397 | 23,926 | 3.88 | % | ||||||||||||||
Noninterest-earning assets (2) | 329,089 | 311,897 | ||||||||||||||||||||
Total assets | $ | 3,282,005 | $ | 2,786,294 | ||||||||||||||||||
Liabilities and shareholders’ equity: | ||||||||||||||||||||||
Deposits: | ||||||||||||||||||||||
Interest-bearing demand accounts | $ | 281,820 | 301 | 0.42 | % | $ | 254,277 | 265 | 0.41 | % | ||||||||||||
Savings accounts | 174,849 | 238 | 0.54 | % | 123,444 | 140 | 0.45 | % | ||||||||||||||
Money market accounts | 1,001,709 | 1,125 | 0.45 | % | 848,300 | 1,060 | 0.50 | % | ||||||||||||||
Certificate accounts | 402,786 | 700 | 0.69 | % | 262,055 | 663 | 0.92 | % | ||||||||||||||
Total interest-bearing deposits | 1,861,164 | 2,364 | 0.50 | % | 1,488,076 | 2,128 | 0.57 | % | ||||||||||||||
FHLB advances | 442,409 | 509 | 0.46 | % | 374,682 | 434 | 0.46 | % | ||||||||||||||
Securities sold under agreements to repurchase | 11,149 | 6 | 0.21 | % | — | — | — | % | ||||||||||||||
Long-term debt | 61,857 | 271 | 1.74 | % | 61,231 | 274 | 1.75 | % | ||||||||||||||
Other borrowings | — | 20 | — | % | 121,166 | 99 | 0.31 | % | ||||||||||||||
Total interest-bearing liabilities | 2,376,579 | 3,170 | 0.53 | % | 2,045,155 | 2,935 | 0.57 | % | ||||||||||||||
Noninterest-bearing liabilities | 610,197 | 469,853 | ||||||||||||||||||||
Total liabilities | 2,986,776 | 2,515,008 | ||||||||||||||||||||
Shareholders’ equity | 295,229 | 271,286 | ||||||||||||||||||||
Total liabilities and shareholders’ equity | $ | 3,282,005 | $ | 2,786,294 | ||||||||||||||||||
Net interest income (3) | $ | 25,779 | $ | 20,991 | ||||||||||||||||||
Net interest spread | 3.36 | % | 3.31 | % | ||||||||||||||||||
Impact of noninterest-bearing sources | 0.14 | % | 0.10 | % | ||||||||||||||||||
Net interest margin | 3.50 | % | 3.41 | % |
(1) | The average balances of nonaccrual assets and related income, if any, are included in their respective categories. |
(2) | Includes loan balances that have been foreclosed and are now reclassified to other real estate owned. |
(3) | Includes taxable-equivalent adjustments primarily related to tax-exempt income on certain loans and securities of $471 thousand and $579 thousand for the quarters ended September 30, 2014 and September 30, 2013, respectively. The estimated federal statutory tax rate was 35% for the periods presented. |
Nine Months Ended September 30, | |||||||||||||||||||||||
2014 | 2013 | ||||||||||||||||||||||
(in thousands) | Average Balance | Interest | Average Yield/Cost | Average Balance | Interest | Average Yield/Cost | |||||||||||||||||
Assets: | |||||||||||||||||||||||
Interest-earning assets: (1) | |||||||||||||||||||||||
Cash and cash equivalents | $ | 30,793 | $ | 45 | 0.19 | % | $ | 27,488 | $ | 46 | 0.26 | % | |||||||||||
Investment securities | 460,723 | 10,005 | 2.90 | % | 497,857 | 11,175 | 2.99 | % | |||||||||||||||
Loans held for sale | 447,946 | 12,863 | 3.84 | % | 415,633 | 11,218 | 3.60 | % | |||||||||||||||
Loans held for investment | 1,838,526 | 59,089 | 4.30 | % | 1,406,582 | 43,795 | 4.13 | % | |||||||||||||||
Total interest-earning assets | 2,777,988 | 82,002 | 3.95 | % | 2,347,560 | 66,234 | 3.75 | % | |||||||||||||||
Noninterest-earning assets (2) | 345,229 | 280,668 | |||||||||||||||||||||
Total assets | $ | 3,123,217 | $ | 2,628,228 | |||||||||||||||||||
Liabilities and shareholders’ equity: | |||||||||||||||||||||||
Deposits: | |||||||||||||||||||||||
Interest-bearing demand accounts | $ | 268,282 | 657 | 0.33 | % | $ | 224,942 | 656 | 0.39 | % | |||||||||||||
Savings accounts | 166,896 | 657 | 0.53 | % | 114,023 | 358 | 0.42 | % | |||||||||||||||
Money market accounts | 969,262 | 3,224 | 0.44 | % | 776,267 | 2,890 | 0.50 | % | |||||||||||||||
Certificate accounts | 476,224 | 2,542 | 0.71 | % | 404,383 | 4,080 | 1.24 | % | |||||||||||||||
Total interest-bearing deposits | 1,880,664 | 7,080 | 0.50 | % | 1,519,615 | 7,984 | 0.69 | % | |||||||||||||||
FHLB advances | 372,605 | 1,366 | 0.49 | % | 277,192 | 1,113 | 0.53 | % | |||||||||||||||
Securities sold under agreements to repurchase | 4,134 | 7 | 0.23 | % | 3,638 | 11 | 0.40 | % | |||||||||||||||
Long-term debt | 62,469 | 851 | 1.82 | % | 61,646 | 2,274 | (3) | 4.86 | % | (3) | |||||||||||||
Other borrowings | — | 32 | — | % | 43,932 | 109 | 0.31 | % | |||||||||||||||
Total interest-bearing liabilities | 2,319,872 | 9,336 | 0.54 | % | 1,906,023 | 11,491 | 0.79 | % | |||||||||||||||
Noninterest-bearing liabilities | 519,199 | 446,742 | |||||||||||||||||||||
Total liabilities | 2,839,071 | 2,352,765 | |||||||||||||||||||||
Shareholders’ equity | 284,146 | 275,463 | |||||||||||||||||||||
Total liabilities and shareholders’ equity | $ | 3,123,217 | $ | 2,628,228 | |||||||||||||||||||
Net interest income (4) | $ | 72,666 | $ | 54,743 | |||||||||||||||||||
Net interest spread | 3.41 | % | 2.96 | % | |||||||||||||||||||
Impact of noninterest-bearing sources | 0.09 | % | 0.16 | % | |||||||||||||||||||
Net interest margin | 3.50 | % | 3.12 | % | (3) |
(1) | The average balances of nonaccrual assets and related income, if any, are included in their respective categories. |
(2) | Includes loan balances that have been foreclosed and are now reclassified to other real estate owned. |
(3) | Interest expense for the first quarter of 2013 includes $1.4 million related to the correction of the cumulative effect of an immaterial error in prior years, resulting from the under accrual of interest due on the TruPS for which the Company had deferred the payment of interest. Excluding the impact of the prior period interest expense correction, the net interest margin was 3.21% for the nine months ended September 30, 2013. |
(4) | Includes taxable-equivalent adjustments primarily related to tax-exempt income on certain loans and securities of $1.5 million and $1.7 million for the nine months ended September 30, 2014 and September 30, 2013, respectively. The estimated federal statutory tax rate was 35% for the periods presented. |
Quarter ended | |||||||||||||||||||||
(in thousands) | Sept. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sept. 30, 2013 | ||||||||||||||||
Net interest income | $ | 20,163 | $ | 19,403 | $ | 20,233 | $ | 18,160 | $ | 16,095 | |||||||||||
Provision (reversal of provision) for loan losses | — | — | (1,500 | ) | — | (1,500 | ) | ||||||||||||||
Noninterest income | 3,660 | 6,614 | 2,958 | 5,501 | 3,478 | ||||||||||||||||
Noninterest expense | 18,930 | 20,434 | 19,293 | 21,729 | 14,648 | ||||||||||||||||
Income before income taxes | 4,893 | 5,583 | 5,398 | 1,932 | 6,425 | ||||||||||||||||
Income tax expense | 1,359 | 1,830 | 1,282 | 497 | 1,568 | ||||||||||||||||
Net income | $ | 3,534 | $ | 3,753 | $ | 4,116 | $ | 1,435 | $ | 4,857 | |||||||||||
Net income, excluding acquisition-related expenses (1) | $ | 4,003 | $ | 4,147 | $ | 4,661 | $ | 4,087 | $ | 5,158 | |||||||||||
Efficiency ratio (2) | 79.46 | % | 78.54 | % | 83.19 | % | 91.83 | % | 74.84 | % | |||||||||||
Full-time equivalent employees (ending) | 605 | 599 | 588 | 577 | 504 | ||||||||||||||||
Net gain on mortgage loan origination and sale activities: | |||||||||||||||||||||
Multifamily | 930 | 693 | 396 | 559 | 2,113 | ||||||||||||||||
Other | (101 | ) | 4,087 | 794 | 964 | — | |||||||||||||||
$ | 829 | $ | 4,780 | $ | 1,190 | $ | 1,523 | $ | 2,113 | ||||||||||||
Production volumes for sale to the secondary market: | |||||||||||||||||||||
Multifamily mortgage originations | $ | 60,699 | $ | 23,105 | $ | 11,343 | $ | 16,325 | $ | 10,734 | |||||||||||
Multifamily mortgage loans sold | 20,409 | 15,902 | 6,263 | 15,775 | 21,998 |
(1) | Commercial and Consumer Banking segment net income, excluding acquisition-related expenses, is a non-GAAP financial disclosure. The Company uses this non-GAAP financial measure to provide meaningful supplemental information regarding the Company's operational performance and to enhance investors' overall understanding of such financial performance. For corresponding reconciliations to GAAP financial measures, see Non-GAAP Financial Measures beginning on page 28 of this earnings release. |
(2) | Noninterest expense divided by total net revenue (net interest income and noninterest income). |
Quarter ended | ||||||||||||||||||||
(in thousands) | Sept. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sept. 30, 2013 | |||||||||||||||
Servicing income, net: | ||||||||||||||||||||
Servicing fees and other | $ | 1,289 | $ | 1,017 | $ | 890 | $ | 834 | $ | 789 | ||||||||||
Amortization of multifamily MSRs | (425 | ) | (434 | ) | (424 | ) | (457 | ) | (433 | ) | ||||||||||
Commercial mortgage servicing income | $ | 864 | $ | 583 | $ | 466 | $ | 377 | $ | 356 |
(in thousands) | Sept. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sept. 30, 2013 | |||||||||||||||
Commercial | ||||||||||||||||||||
Multifamily | $ | 703,197 | $ | 704,997 | $ | 721,464 | $ | 720,429 | $ | 722,767 | ||||||||||
Other | 86,589 | 97,996 | 99,340 | 95,673 | 50,629 | |||||||||||||||
Total commercial loans serviced for others | $ | 789,786 | $ | 802,993 | $ | 820,804 | $ | 816,102 | $ | 773,396 |
Quarter ended | ||||||||||||||||||||
(in thousands) | Sept. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sept. 30, 2013 | |||||||||||||||
Beginning balance | $ | 9,122 | $ | 9,095 | $ | 9,335 | $ | 9,403 | $ | 9,239 | ||||||||||
Originations | 418 | 461 | 183 | 375 | 597 | |||||||||||||||
Amortization | (424 | ) | (434 | ) | (423 | ) | (443 | ) | (433 | ) | ||||||||||
Ending balance | $ | 9,116 | $ | 9,122 | $ | 9,095 | $ | 9,335 | $ | 9,403 | ||||||||||
Ratio of MSR carrying value to related loans serviced for others | 1.23 | % | 1.21 | % | 1.18 | % | 1.21 | % | 1.22 | % | ||||||||||
MSR servicing fee multiple (1) | 2.87 | 2.83 | 2.81 | 2.91 | 2.94 | |||||||||||||||
Weighted-average note rate (loans serviced for others) | 5.12 | % | 5.15 | % | 5.20 | % | 5.12 | % | 5.22 | % | ||||||||||
Weighted-average servicing fee (loans serviced for others) | 0.43 | % | 0.43 | % | 0.42 | % | 0.42 | % | 0.41 | % |
(1) | Represents the ratio of MSR carrying value to related loans serviced for others divided by the weighted-average servicing fee for loans serviced for others. |
(in thousands, except for duration data) | Sept. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sept. 30, 2013 | |||||||||||||||
Available for sale: | ||||||||||||||||||||
Mortgage-backed securities: | ||||||||||||||||||||
Residential | $ | 110,837 | $ | 110,266 | $ | 120,103 | $ | 133,910 | $ | 144,263 | ||||||||||
Commercial | 13,571 | 13,674 | 13,596 | 13,433 | 13,720 | |||||||||||||||
Municipal bonds | 123,041 | 125,813 | 124,860 | 130,850 | 147,441 | |||||||||||||||
Collateralized mortgage obligations: | ||||||||||||||||||||
Residential | 54,887 | 56,767 | 60,537 | 90,327 | 153,466 | |||||||||||||||
Commercial | 15,633 | 16,021 | 11,639 | 16,845 | 16,991 | |||||||||||||||
Corporate debt securities | 72,114 | 72,420 | 70,805 | 68,866 | 69,963 | |||||||||||||||
U.S. Treasury | 42,013 | 42,010 | 26,996 | 27,452 | 27,747 | |||||||||||||||
Total available for sale | $ | 432,096 | $ | 436,971 | $ | 428,536 | $ | 481,683 | $ | 573,591 | ||||||||||
Held to maturity | 17,852 | 17,995 | 18,103 | 17,133 | 1,303 | |||||||||||||||
$ | 449,948 | $ | 454,966 | $ | 446,639 | $ | 498,816 | $ | 574,894 | |||||||||||
Weighted average duration in years | ||||||||||||||||||||
Available for sale | 5.0 | 4.5 | 5.0 | 5.1 | 4.9 |
(in thousands) | Sept. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sept. 30, 2013 | |||||||||||||||
Consumer loans | ||||||||||||||||||||
Single family | $ | 788,232 | $ | 749,204 | $ | 668,277 | $ | 904,913 | $ | 818,992 | ||||||||||
Home equity | 138,276 | 136,181 | 134,882 | 135,650 | 129,785 | |||||||||||||||
926,508 | 885,385 | 803,159 | 1,040,563 | 948,777 | ||||||||||||||||
Commercial loans | ||||||||||||||||||||
Commercial real estate | 530,335 | 476,411 | 480,200 | 477,642 | 400,150 | |||||||||||||||
Multifamily | 62,498 | 72,327 | 71,278 | 79,216 | 42,187 | |||||||||||||||
Construction/land development | 297,790 | 219,282 | 162,717 | 130,465 | 79,435 | |||||||||||||||
Commercial business | 173,226 | 185,177 | 171,080 | 171,054 | 67,547 | |||||||||||||||
1,063,849 | 953,197 | 885,275 | 858,377 | 589,319 | ||||||||||||||||
1,990,357 | 1,838,582 | 1,688,434 | 1,898,940 | 1,538,096 | ||||||||||||||||
Net deferred loan fees and discounts | (3,748 | ) | (3,761 | ) | (3,684 | ) | (3,219 | ) | (3,233 | ) | ||||||||||
1,986,609 | 1,834,821 | 1,684,750 | 1,895,721 | 1,534,863 | ||||||||||||||||
Allowance for loan losses | (21,847 | ) | (21,926 | ) | (22,127 | ) | (23,908 | ) | (24,694 | ) | ||||||||||
$ | 1,964,762 | $ | 1,812,895 | $ | 1,662,623 | $ | 1,871,813 | $ | 1,510,169 |
Quarter ended | ||||||||||||||||||||
(in thousands) | Sept. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sept. 30, 2013 | |||||||||||||||
Beginning balance | $ | 22,168 | $ | 22,317 | $ | 24,089 | $ | 24,894 | $ | 27,858 | ||||||||||
Provision (reversal of provision) for credit losses | — | — | (1,500 | ) | — | (1,500 | ) | |||||||||||||
(Charge-offs), net of recoveries | (57 | ) | (149 | ) | (272 | ) | (805 | ) | (1,464 | ) | ||||||||||
Ending balance | $ | 22,111 | $ | 22,168 | $ | 22,317 | $ | 24,089 | $ | 24,894 | ||||||||||
Components: | ||||||||||||||||||||
Allowance for loan losses | $ | 21,847 | $ | 21,926 | $ | 22,127 | $ | 23,908 | $ | 24,694 | ||||||||||
Allowance for unfunded commitments | 264 | 242 | 190 | 181 | 200 | |||||||||||||||
Allowance for credit losses | $ | 22,111 | $ | 22,168 | $ | 22,317 | $ | 24,089 | $ | 24,894 | ||||||||||
Allowance as a % of loans held for investment | 1.10 | % | (1) | 1.19 | % | (1) | 1.31 | % | (1) | 1.26 | % | (1) | 1.61 | % | ||||||
Allowance as a % of nonaccrual loans | 109.75 | % | 103.44 | % | 96.95 | % | 93.00 | % | 92.30 | % |
(1) | Includes loans acquired with bank acquisitions. Excluding acquired loans, allowance for loan losses/total loans was 1.18%, 1.31%, 1.46% and 1.40% at September 30, 2014, June 30, 2014, March 31, 2014 and December 31, 2013, respectively. |
Quarter ended | ||||||||||||||||||||
(in thousands) | Sept. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sept. 30, 2013 | |||||||||||||||
Beginning balance | $ | 32,280 | $ | 34,912 | $ | 38,618 | $ | 39,019 | $ | 41,650 | ||||||||||
Additions | 3,414 | 4,533 | 1,811 | 9,959 | (1) | 5,517 | ||||||||||||||
Reductions: | ||||||||||||||||||||
Charge-offs | (57 | ) | (149 | ) | (272 | ) | (805 | ) | (1,464 | ) | ||||||||||
OREO sales | (1,183 | ) | (1,639 | ) | (2,482 | ) | (1,442 | ) | (2,573 | ) | ||||||||||
OREO writedowns and other adjustments | (93 | ) | — | (4 | ) | (108 | ) | (208 | ) | |||||||||||
Principal paydown, payoff advances and other adjustments | (948 | ) | (2,753 | ) | (1,520 | ) | (4,131 | ) | (3,079 | ) | ||||||||||
Transferred back to accrual status | (3,029 | ) | (2,624 | ) | (1,239 | ) | (3,874 | ) | (824 | ) | ||||||||||
Total reductions | (5,310 | ) | (7,165 | ) | (5,517 | ) | (10,360 | ) | (8,148 | ) | ||||||||||
Net reductions | (1,896 | ) | (2,632 | ) | (3,706 | ) | (401 | ) | (2,631 | ) | ||||||||||
Ending balance | $ | 30,384 | (2) | $ | 32,280 | (2) | $ | 34,912 | (2) | $ | 38,618 | (2) | $ | 39,019 |
(1) | Additions to NPAs included $7.9 million of acquired nonperforming assets during the quarter ended December 31, 2013. |
(2) | Includes $6.3 million, $6.5 million, $6.6 million and $6.5 million of nonperforming loans at September 30, 2014, June 30, 2014, March 31, 2014 and December 31, 2013, respectively, that are guaranteed by the SBA. |
(in thousands) | Sept. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sept. 30, 2013 | |||||||||||||||
Loans accounted for on a nonaccrual basis: | ||||||||||||||||||||
Consumer | ||||||||||||||||||||
Single family | $ | 8,350 | $ | 6,988 | $ | 6,942 | $ | 8,861 | $ | 12,648 | ||||||||||
Home equity | 1,700 | 1,166 | 1,078 | 1,846 | 2,295 | |||||||||||||||
10,050 | 8,154 | 8,020 | 10,707 | 14,943 | ||||||||||||||||
Commercial | ||||||||||||||||||||
Commercial real estate | 7,058 | 9,871 | 12,192 | 12,257 | 6,861 | |||||||||||||||
Multifamily | — | — | — | — | — | |||||||||||||||
Construction/land development | — | — | — | — | 3,544 | |||||||||||||||
Commercial business | 2,798 | 3,172 | 2,611 | 2,743 | 1,405 | |||||||||||||||
9,856 | 13,043 | 14,803 | 15,000 | 11,810 | ||||||||||||||||
Total loans on nonaccrual | $ | 19,906 | $ | 21,197 | $ | 22,823 | $ | 25,707 | $ | 26,753 | ||||||||||
Nonaccrual loans as a % of total loans | 1.00 | % | 1.16 | % | 1.35 | % | 1.36 | % | 1.74 | % | ||||||||||
Other real estate owned: | ||||||||||||||||||||
Consumer | ||||||||||||||||||||
Single family | $ | 2,818 | $ | 3,205 | $ | 4,211 | $ | 5,246 | $ | 5,494 | ||||||||||
Home equity | — | — | — | — | — | |||||||||||||||
Commercial | ||||||||||||||||||||
Commercial real estate | 1,822 | 2,040 | 2,040 | 1,688 | — | |||||||||||||||
Multifamily | — | — | — | — | — | |||||||||||||||
Construction/land development | 5,838 | 5,838 | 5,838 | 5,977 | 5,815 | |||||||||||||||
Commercial business | — | — | — | — | 957 | |||||||||||||||
7,660 | 7,878 | 7,878 | 7,665 | 6,772 | ||||||||||||||||
Total other real estate owned | $ | 10,478 | $ | 11,083 | $ | 12,089 | $ | 12,911 | $ | 12,266 | ||||||||||
Nonperforming assets: | ||||||||||||||||||||
Consumer | ||||||||||||||||||||
Single family | $ | 11,168 | $ | 10,193 | $ | 11,153 | $ | 14,107 | $ | 18,142 | ||||||||||
Home equity | 1,700 | 1,166 | 1,078 | 1,846 | 2,295 | |||||||||||||||
12,868 | 11,359 | 12,231 | 15,953 | 20,437 | ||||||||||||||||
Commercial | ||||||||||||||||||||
Commercial real estate | 8,880 | 11,911 | 14,232 | 13,945 | 6,861 | |||||||||||||||
Multifamily | — | — | — | — | — | |||||||||||||||
Construction/land development | 5,838 | 5,838 | 5,838 | 5,977 | 9,359 | |||||||||||||||
Commercial business | 2,798 | 3,172 | 2,611 | 2,743 | 2,362 | |||||||||||||||
17,516 | 20,921 | 22,681 | 22,665 | 18,582 | ||||||||||||||||
Total nonperforming assets | $ | 30,384 | (1) | $ | 32,280 | (1) | $ | 34,912 | (1) | $ | 38,618 | (1) | $ | 39,019 | ||||||
Nonperforming assets as a % of total assets | 0.87 | % | 1.00 | % | 1.12 | % | 1.26 | % | 1.37 | % |
(1) | Includes $6.3 million, $6.5 million, $6.6 million and $6.5 million of nonperforming loans at September 30, 2014, June 30, 2014, March 31, 2014 and December 31, 2013, respectively, that are guaranteed by the SBA. |
(in thousands) | 30-59 days past due | 60-89 days past due | 90 days or more past due | Total past due | Current | Total loans | ||||||||||||||||||
September 30, 2014 | ||||||||||||||||||||||||
Total loans held for investment | $ | 9,713 | $ | 4,249 | $ | 51,386 | $ | 65,348 | $ | 1,925,009 | $ | 1,990,357 | ||||||||||||
Less: FHA/VA loans(1) | 6,802 | 2,605 | 31,480 | 40,887 | $ | 45,986 | 86,873 | |||||||||||||||||
Total loans, excluding FHA/VA loans | $ | 2,911 | $ | 1,644 | $ | 19,906 | $ | 24,461 | $ | 1,879,023 | $ | 1,903,484 | ||||||||||||
Loans by segment and class, excluding FHA/VA loans: | ||||||||||||||||||||||||
Consumer loans | ||||||||||||||||||||||||
Single family residential | $ | 2,406 | $ | 1,535 | $ | 8,350 | $ | 12,291 | 689,068 | $ | 701,359 | |||||||||||||
Home equity | 461 | 109 | 1,700 | 2,270 | 136,006 | 138,276 | ||||||||||||||||||
2,867 | 1,644 | 10,050 | 14,561 | 825,074 | 839,635 | |||||||||||||||||||
Commercial loans | ||||||||||||||||||||||||
Commercial real estate | — | — | 7,058 | 7,058 | 523,277 | 530,335 | ||||||||||||||||||
Multifamily residential | — | — | — | — | 62,498 | 62,498 | ||||||||||||||||||
Construction/land development | — | — | — | — | 297,790 | 297,790 | ||||||||||||||||||
Commercial business | 44 | — | 2,798 | 2,842 | 170,384 | 173,226 | ||||||||||||||||||
44 | — | 9,856 | 9,900 | 1,053,949 | 1,063,849 | |||||||||||||||||||
$ | 2,911 | $ | 1,644 | $ | 19,906 | (2) | $ | 24,461 | (2) | $ | 1,879,023 | $ | 1,903,484 | |||||||||||
As a % of total loans, excluding FHA/VA loans | 0.15 | % | 0.09 | % | 1.05 | % | 1.29 | % | 98.71 | % | 100.00 | % | ||||||||||||
December 31, 2013 | ||||||||||||||||||||||||
Total loans held for investment | $ | 6,841 | $ | 4,976 | $ | 72,518 | $ | 84,335 | $ | 1,814,605 | $ | 1,898,940 | ||||||||||||
Less: FHA/VA loans(1) | 4,286 | 3,730 | 46,811 | 54,827 | 37,177 | 92,004 | ||||||||||||||||||
Total loans, excluding FHA/VA loans | $ | 2,555 | $ | 1,246 | $ | 25,707 | $ | 29,508 | $ | 1,777,428 | $ | 1,806,936 | ||||||||||||
Loans by segment and class, excluding FHA/VA loans: | ||||||||||||||||||||||||
Consumer loans | ||||||||||||||||||||||||
Single family | $ | 2,180 | $ | 1,171 | $ | 8,861 | $ | 12,212 | $ | 800,697 | $ | 812,909 | ||||||||||||
Home equity | 375 | 75 | 1,846 | 2,296 | 133,354 | 135,650 | ||||||||||||||||||
2,555 | 1,246 | 10,707 | 14,508 | 934,051 | 948,559 | |||||||||||||||||||
Commercial loans | ||||||||||||||||||||||||
Commercial real estate | — | — | 12,257 | 12,257 | 465,385 | 477,642 | ||||||||||||||||||
Multifamily | — | — | — | — | 79,216 | 79,216 | ||||||||||||||||||
Construction/land development | — | — | — | — | 130,465 | 130,465 | ||||||||||||||||||
Commercial business | — | — | 2,743 | 2,743 | 168,311 | 171,054 | ||||||||||||||||||
— | — | 15,000 | 15,000 | 843,377 | 858,377 | |||||||||||||||||||
$ | 2,555 | $ | 1,246 | $ | 25,707 | (2) | $ | 29,508 | (2) | $ | 1,777,428 | $ | 1,806,936 | |||||||||||
As a % of total loans, excluding FHA/VA loans | 0.14 | % | 0.07 | % | 1.42 | % | 1.63 | % | 98.37 | % | 100.00 | % |
(1) | Represents loans whose repayments are insured by the FHA or guaranteed by the VA. |
(2) | Includes $6.3 million and $6.5 million of nonperforming loans at September 30, 2014 and December 31, 2013, respectively, that are guaranteed by the SBA. |
(in thousands) | Sept. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sept. 30, 2013 | |||||||||||||||
Accrual | ||||||||||||||||||||
Consumer loans | ||||||||||||||||||||
Single family(1) | $ | 72,663 | $ | 69,779 | $ | 70,958 | $ | 70,304 | $ | 71,686 | ||||||||||
Home equity | 2,501 | 2,394 | 2,538 | 2,558 | 2,426 | |||||||||||||||
75,164 | 72,173 | 73,496 | 72,862 | 74,112 | ||||||||||||||||
Commercial loans | ||||||||||||||||||||
Commercial real estate | 23,964 | 21,401 | 19,451 | 19,620 | 20,385 | |||||||||||||||
Multifamily | 3,101 | 3,125 | 3,145 | 3,163 | 3,190 | |||||||||||||||
Construction/land development | 5,693 | 5,843 | 5,907 | 6,148 | 3,122 | |||||||||||||||
Commercial business | 658 | 302 | 104 | 112 | 120 | |||||||||||||||
33,416 | 30,671 | 28,607 | 29,043 | 26,817 | ||||||||||||||||
$ | 108,580 | $ | 102,844 | $ | 102,103 | $ | 101,905 | $ | 100,929 | |||||||||||
Nonaccrual | ||||||||||||||||||||
Consumer loans | ||||||||||||||||||||
Single family | $ | 1,379 | $ | 1,461 | $ | 2,569 | $ | 4,017 | $ | 4,819 | ||||||||||
Home equity | 20 | — | — | 86 | 132 | |||||||||||||||
1,399 | 1,461 | 2,569 | 4,103 | 4,951 | ||||||||||||||||
Commercial loans | ||||||||||||||||||||
Commercial real estate | 1,182 | 2,735 | 2,784 | 628 | — | |||||||||||||||
Multifamily | — | — | — | — | — | |||||||||||||||
Construction/land development | — | — | — | — | 3,544 | |||||||||||||||
Commercial business | 9 | 9 | 117 | — | — | |||||||||||||||
1,191 | 2,744 | 2,901 | 628 | 3,544 | ||||||||||||||||
$ | 2,590 | $ | 4,205 | $ | 5,470 | $ | 4,731 | $ | 8,495 | |||||||||||
Total | ||||||||||||||||||||
Consumer loans | ||||||||||||||||||||
Single family(1) | $ | 74,042 | $ | 71,240 | $ | 73,527 | $ | 74,321 | $ | 76,505 | ||||||||||
Home equity | 2,521 | 2,394 | 2,538 | 2,644 | 2,558 | |||||||||||||||
76,563 | 73,634 | 76,065 | 76,965 | 79,063 | ||||||||||||||||
Commercial loans | ||||||||||||||||||||
Commercial real estate | 25,146 | 24,136 | 22,235 | 20,248 | 20,385 | |||||||||||||||
Multifamily | 3,101 | 3,125 | 3,145 | 3,163 | 3,190 | |||||||||||||||
Construction/land development | 5,693 | 5,843 | 5,907 | 6,148 | 6,666 | |||||||||||||||
Commercial business | 667 | 311 | 221 | 112 | 120 | |||||||||||||||
34,607 | 33,415 | 31,508 | 29,671 | 30,361 | ||||||||||||||||
$ | 111,170 | $ | 107,049 | $ | 107,573 | $ | 106,636 | $ | 109,424 |
(1) | Includes loan balances insured by the FHA or guaranteed by the VA of $24.6 million, $19.0 million, $19.1 million, $17.8 million and $17.6 million at September 30, 2014, June 30, 2014, March 31, 2014, December 31, 2013 and September 30, 2013, respectively. |
Quarter ended | ||||||||||||||||||||
(in thousands) | Sept. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sept. 30, 2013 | |||||||||||||||
Recorded investment of re-defaults(1) | ||||||||||||||||||||
Consumer loans | ||||||||||||||||||||
Single family | $ | 282 | $ | 425 | $ | 303 | $ | 267 | $ | 1,017 | ||||||||||
Home equity | — | — | 190 | — | — | |||||||||||||||
282 | 425 | 493 | 267 | 1,017 | ||||||||||||||||
Commercial loans | ||||||||||||||||||||
Commercial real estate | — | — | — | — | — | |||||||||||||||
Multifamily | — | — | — | — | — | |||||||||||||||
Construction/land development | — | — | — | — | — | |||||||||||||||
Commercial business | — | — | — | — | — | |||||||||||||||
— | — | — | — | — | ||||||||||||||||
$ | 282 | $ | 425 | $ | 493 | $ | 267 | $ | 1,017 |
(1) | Represents TDRs that have defaulted in the current period within 12 months of their modification date. Defaulted TDRs are reported in the table above based on a payment default definition of 60 days past due for the consumer loans portfolio segment and 90 days past due for the commercial loans portfolio segment. |
(in thousands) | Sept. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sept. 30, 2013 | |||||||||||||||
Deposits by Product: | ||||||||||||||||||||
Noninterest-bearing accounts - checking and savings | $ | 271,669 | $ | 235,844 | $ | 219,677 | $ | 199,943 | $ | 134,725 | ||||||||||
Interest-bearing transaction and savings deposits: | ||||||||||||||||||||
NOW accounts | 300,832 | 324,604 | 285,104 | 262,138 | 272,029 | |||||||||||||||
Statement savings accounts due on demand | 184,656 | 166,851 | 163,819 | 156,181 | 135,428 | |||||||||||||||
Money market accounts due on demand | 1,015,266 | 996,473 | 956,189 | 919,322 | 879,122 | |||||||||||||||
Total interest-bearing transaction and savings deposits | 1,500,754 | 1,487,928 | 1,405,112 | 1,337,641 | 1,286,579 | |||||||||||||||
Total transaction and savings deposits | 1,772,423 | 1,723,772 | 1,624,789 | 1,537,584 | 1,421,304 | |||||||||||||||
Certificates of deposit | 367,124 | 457,529 | 534,708 | 514,400 | 460,223 | |||||||||||||||
Noninterest-bearing accounts - other | 285,911 | 236,411 | 211,861 | 158,837 | 216,549 | |||||||||||||||
Total deposits | $ | 2,425,458 | $ | 2,417,712 | $ | 2,371,358 | $ | 2,210,821 | $ | 2,098,076 | ||||||||||
Percent of total deposits: | ||||||||||||||||||||
Noninterest-bearing accounts - checking and savings | 11.2 | % | 9.8 | % | 9.3 | % | 9.0 | % | 6.4 | % | ||||||||||
Interest-bearing transaction and savings deposits: | ||||||||||||||||||||
NOW accounts | 12.4 | 13.4 | 12.0 | 11.9 | 13.0 | |||||||||||||||
Statement savings accounts due on demand | 7.6 | 6.9 | 6.9 | 7.1 | 6.5 | |||||||||||||||
Money market accounts due on demand | 41.9 | 41.2 | 40.3 | 41.6 | 41.9 | |||||||||||||||
Total interest-bearing transaction and savings deposits | 61.9 | 61.5 | 59.2 | 60.6 | 61.4 | |||||||||||||||
Total transaction and savings deposits | 73.1 | 71.3 | 68.5 | 69.6 | 67.8 | |||||||||||||||
Certificates of deposit | 15.1 | 18.9 | 22.5 | 23.3 | 21.9 | |||||||||||||||
Noninterest-bearing accounts - other | 11.8 | 9.8 | 9.0 | 7.1 | 10.3 | |||||||||||||||
Total deposits | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % |
Quarter ended | ||||||||||||||||||||
(in thousands) | Sept. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sept. 30, 2013 | |||||||||||||||
Net interest income | $ | 5,145 | $ | 3,744 | $ | 2,479 | $ | 3,222 | $ | 4,317 | ||||||||||
Noninterest income | 42,153 | 47,036 | 31,749 | 30,571 | 34,696 | |||||||||||||||
Noninterest expense | 45,228 | 42,537 | 36,798 | 37,139 | 43,468 | |||||||||||||||
Income (loss) before income taxes | 2,070 | 8,243 | (2,570 | ) | (3,346 | ) | (4,455 | ) | ||||||||||||
Income tax expense (benefit) | 629 | 2,634 | (755 | ) | (1,050 | ) | (1,260 | ) | ||||||||||||
Net income (loss) | $ | 1,441 | $ | 5,609 | $ | (1,815 | ) | $ | (2,296 | ) | $ | (3,195 | ) | |||||||
Efficiency ratio (1) | 95.62 | % | 83.77 | % | 107.51 | % | 109.90 | % | 111.42 | % | ||||||||||
Full-time equivalent employees (ending) | 993 | 947 | 903 | 925 | 922 | |||||||||||||||
Production volumes for sale to the secondary market: | ||||||||||||||||||||
Single family mortgage closed loan volume (2)(3) | $ | 1,294,895 | $ | 1,100,704 | $ | 674,283 | $ | 773,146 | $ | 1,187,061 | ||||||||||
Single family mortgage interest rate lock commitments(2) | 1,167,677 | 1,201,665 | 803,308 | 662,015 | 786,147 | |||||||||||||||
Single family mortgage loans sold(2) | 1,179,464 | 906,342 | 619,913 | 816,555 | 1,326,888 |
(1) | Noninterest expense divided by total net revenue (net interest income and noninterest income). |
(2) | Includes loans originated by WMS Series LLC and purchased by HomeStreet, Inc. |
(3) | Represents single family mortgage production volume designated for sale to the secondary market during each respective period. |
Quarter ended | ||||||||||||||||||||
(in thousands) | Sept. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sept. 30, 2013 | |||||||||||||||
Net gain on mortgage loan origination and sale activities:(1) | ||||||||||||||||||||
Single family: | ||||||||||||||||||||
Servicing value and secondary market gains(2) | $ | 29,866 | $ | 30,233 | $ | 19,559 | $ | 17,632 | $ | 23,076 | ||||||||||
Loan origination and funding fees | 6,947 | 6,781 | 4,761 | 5,687 | 8,302 | |||||||||||||||
Total mortgage banking net gain on mortgage loan origination and sale activities(1) | $ | 36,813 | $ | 37,014 | $ | 24,320 | $ | 23,319 | $ | 31,378 | ||||||||||
Composite Margin (in basis points): | ||||||||||||||||||||
Servicing value and secondary market gains / interest rate lock commitments(3) | 256 | 252 | 243 | 266 | 294 | |||||||||||||||
Loan origination and funding fees / retail mortgage originations(4) | 60 | 69 | 80 | 84 | 81 | |||||||||||||||
Composite Margin | 316 | 321 | 323 | 350 | 375 |
(1) | Excludes inter-segment activities. |
(2) | Comprised of gains and losses on interest rate lock commitments (which considers the value of servicing), single family loans held for sale, forward sale commitments used to economically hedge secondary market activities, and the estimated fair value of the repurchase or indemnity obligation recognized on new loan sales. |
(3) | Servicing value and secondary marketing gains have been aggregated and are stated as a percentage of interest rate lock commitments. |
(4) | Loan origination and funding fees is stated as a percentage of mortgage originations from the retail channel and excludes mortgage loans purchased from WMS Series LLC. |
Quarter ended | ||||||||||||||||||||
(in thousands) | Sept. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sept. 30, 2013 | |||||||||||||||
Servicing income, net: | ||||||||||||||||||||
Servicing fees and other | $ | 8,061 | $ | 9,095 | $ | 8,959 | $ | 8,843 | $ | 8,145 | ||||||||||
Changes in fair value of single family MSRs due to modeled amortization (1) | (6,212 | ) | (7,109 | ) | (5,968 | ) | (6,016 | ) | (5,665 | ) | ||||||||||
1,849 | 1,986 | 2,991 | 2,827 | 2,480 | ||||||||||||||||
Risk management, single family MSRs: | ||||||||||||||||||||
Changes in fair value of MSR due to changes in model inputs and/or assumptions (2) | 899 | (3,326 | ) | (3) | (5,409 | ) | 12,643 | (2,456 | ) | |||||||||||
Net gain (loss) from derivatives economically hedging MSR | 2,543 | 10,941 | 9,897 | (8,040 | ) | 3,631 | ||||||||||||||
3,442 | 7,615 | 4,488 | 4,603 | 1,175 | ||||||||||||||||
Mortgage Banking servicing income | $ | 5,291 | $ | 9,601 | $ | 7,479 | $ | 7,430 | $ | 3,655 |
(1) | Represents changes due to collection/realization of expected cash flows and curtailments. |
(2) | Principally reflects changes in model assumptions, including prepayment speed assumptions, which are primarily affected by changes in mortgage interest rates. |
(3) | Includes pre-tax income of $4.7 million, net of transaction costs, resulting from the sale of single family MSRs during the quarter ended June 30, 2014. |
(in thousands) | Sept. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sept. 30, 2013 | |||||||||||||||
Single family | ||||||||||||||||||||
U.S. government and agency | $ | 10,007,872 | $ | 9,308,096 | $ | 11,817,857 | $ | 11,467,853 | $ | 10,950,086 | ||||||||||
Other | 585,393 | 586,978 | 380,622 | 327,768 | 336,158 | |||||||||||||||
Total single family loans serviced for others | $ | 10,593,265 | $ | 9,895,074 | $ | 12,198,479 | $ | 11,795,621 | $ | 11,286,244 |
Quarter ended | ||||||||||||||||||||
(in thousands) | Sept. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sept. 30, 2013 | |||||||||||||||
Beginning balance | $ | 108,869 | $ | 149,646 | $ | 153,128 | $ | 136,897 | $ | 128,146 | ||||||||||
Additions and amortization: | ||||||||||||||||||||
Originations | 11,944 | 11,827 | 7,893 | 9,602 | 16,862 | |||||||||||||||
Purchases | 3 | 3 | 2 | 2 | 10 | |||||||||||||||
Sale of servicing rights | — | (43,248 | ) | — | — | — | ||||||||||||||
Changes due to modeled amortization (1) | (6,212 | ) | (7,109 | ) | (5,968 | ) | (6,016 | ) | (5,665 | ) | ||||||||||
Net additions and amortization | 5,735 | (38,527 | ) | 1,927 | 3,588 | 11,207 | ||||||||||||||
Changes in fair value due to changes in model inputs and/or assumptions (2) | 873 | (2,250 | ) | (5,409 | ) | 12,643 | (2,456 | ) | ||||||||||||
Ending balance | $ | 115,477 | $ | 108,869 | $ | 149,646 | $ | 153,128 | $ | 136,897 | ||||||||||
Ratio of MSR carrying value to related loans serviced for others | 1.09 | % | 1.10 | % | 1.23 | % | 1.30 | % | 1.21 | % | ||||||||||
MSR servicing fee multiple (3) | 3.68 | 3.67 | 4.17 | 4.39 | 4.08 | |||||||||||||||
Weighted-average note rate (loans serviced for others) | 4.19 | % | 4.19 | % | 4.09 | % | 4.08 | % | 4.13 | % | ||||||||||
Weighted-average servicing fee (loans serviced for others) | 0.30 | % | 0.30 | % | 0.29 | % | 0.30 | % | 0.30 | % |
(1) | Represents changes due to collection/realization of expected cash flows and curtailments. |
(2) | Principally reflects changes in model assumptions, including prepayment speed assumptions, which are primarily affected by changes in mortgage interest rates. Includes fair value adjustment of $5.7 million related to the sale of single family MSRs during the quarter ended June 30, 2014. |
(3) | Represents the ratio of MSR carrying value to related loans serviced for others divided by the weighted-average servicing fee for loans serviced for others. |
Quarter Ended | Nine Months Ended | |||||||||||||||||||||||||||
(dollars in thousands, except share data) | Sept. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sept. 30, 2013 | Sept. 30, 2014 | Sept. 30, 2013 | |||||||||||||||||||||
Shareholders' equity | $ | 294,568 | $ | 288,249 | $ | 273,510 | $ | 265,926 | $ | 268,208 | $ | 294,568 | $ | 268,208 | ||||||||||||||
Less: Goodwill and other intangibles | (14,444 | ) | (14,690 | ) | (14,098 | ) | (14,287 | ) | (424 | ) | (14,444 | ) | (424 | ) | ||||||||||||||
Tangible shareholders' equity | $ | 280,124 | $ | 273,559 | $ | 259,412 | $ | 251,639 | $ | 267,784 | $ | 280,124 | $ | 267,784 | ||||||||||||||
Book value per share | $ | 19.83 | $ | 19.41 | $ | 18.42 | $ | 17.97 | $ | 18.60 | $ | 19.83 | $ | 18.60 | ||||||||||||||
Impact of goodwill and other intangibles | (0.97 | ) | (0.99 | ) | (0.95 | ) | (0.97 | ) | (0.03 | ) | (0.97 | ) | (0.03 | ) | ||||||||||||||
Tangible book value per share | $ | 18.86 | $ | 18.42 | $ | 17.47 | $ | 17.00 | $ | 18.57 | $ | 18.86 | $ | 18.57 | ||||||||||||||
Average shareholders' equity | $ | 295,229 | $ | 284,365 | $ | 272,596 | $ | 268,328 | $ | 271,286 | $ | 284,146 | $ | 275,463 | ||||||||||||||
Less: Average goodwill and other intangibles | (14,604 | ) | (14,049 | ) | (14,215 | ) | (9,927 | ) | (424 | ) | (14,291 | ) | (424 | ) | ||||||||||||||
Average tangible shareholders' equity | $ | 280,625 | $ | 270,316 | $ | 258,381 | $ | 258,401 | $ | 270,862 | $ | 269,855 | $ | 275,039 | ||||||||||||||
Return on average shareholders’ equity | 6.74 | % | 13.17 | % | 3.38 | % | (1.28 | )% | 2.45 | % | 7.81 | % | 11.94 | % | ||||||||||||||
Impact of goodwill and other intangibles | 0.35 | % | 0.68 | % | 0.18 | % | (0.05 | )% | — | % | 0.41 | % | 0.02 | % | ||||||||||||||
Return on average tangible shareholders' equity | 7.09 | % | 13.85 | % | 3.56 | % | (1.33 | )% | 2.45 | % | 8.22 | % | 11.96 | % |
Quarter Ended | Nine Months Ended | |||||||||||||||||||||||||||
(in thousands) | Sept. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sept. 30, 2013 | Sept. 30, 2014 | Sept. 30, 2013 | |||||||||||||||||||||
Net income (loss) | $ | 4,975 | $ | 9,362 | $ | 2,301 | $ | (861 | ) | $ | 1,662 | $ | 16,638 | $ | 24,670 | |||||||||||||
Add back: Acquisition-related expenses, net of tax | 469 | 394 | 545 | 2,652 | 301 | 1,408 | 305 | |||||||||||||||||||||
Net income, excluding acquisition-related expenses | $ | 5,444 | $ | 9,756 | $ | 2,846 | $ | 1,791 | $ | 1,963 | $ | 18,046 | $ | 24,975 | ||||||||||||||
Noninterest expense | $ | 64,158 | $ | 62,971 | $ | 56,091 | $ | 58,868 | $ | 58,116 | $ | 183,220 | $ | 170,627 | ||||||||||||||
Deduct: acquisition-related expenses | (722 | ) | (606 | ) | (838 | ) | (4,080 | ) | (463 | ) | (2,166 | ) | (469 | ) | ||||||||||||||
Noninterest expense, excluding acquisition-related expenses | $ | 63,436 | $ | 62,365 | $ | 55,253 | $ | 54,788 | $ | 57,653 | $ | 181,054 | $ | 170,158 | ||||||||||||||
Diluted earnings (loss) per common share | $ | 0.33 | $ | 0.63 | $ | 0.15 | $ | (0.06 | ) | $ | 0.11 | $ | 1.11 | $ | 1.67 | |||||||||||||
Impact of acquisition-related expenses | 0.03 | 0.02 | 0.04 | 0.18 | 0.02 | 0.10 | 0.02 | |||||||||||||||||||||
Diluted earnings per common share, excluding acquisition-related expenses | $ | 0.36 | $ | 0.65 | $ | 0.19 | $ | 0.12 | $ | 0.13 | $ | 1.21 | $ | 1.69 | ||||||||||||||
Commercial and Consumer Banking Segment: | ||||||||||||||||||||||||||||
Net income (loss) | $ | 3,534 | $ | 3,753 | $ | 4,116 | $ | 1,435 | $ | 4,857 | $ | 11,403 | $ | 4,538 | ||||||||||||||
Impact of acquisition-related expenses, net of tax | 469 | 394 | 545 | 2,652 | 301 | 1,408 | 305 | |||||||||||||||||||||
Net income (loss), excluding acquisition-related expenses | $ | 4,003 | $ | 4,147 | $ | 4,661 | $ | 4,087 | $ | 5,158 | $ | 12,811 | $ | 4,843 |
Contact: | Investor Relations & Media: | |
HomeStreet, Inc. | ||
Terri Silver, 206-389-6303 | ||
terri.silver@homestreet.com | ||
http://ir.homestreet.com |
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