New Jersey | 1-11277 | 22-2477875 | ||
(State or Other Jurisdiction of Incorporation) | (Commission File Number) | (I.R.S. Employer Identification Number) |
1455 Valley Road, Wayne, New Jersey | 7470 | |
(Address of Principal Executive Offices) | (Zip Code) |
¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Dated: January 30, 2014 | VALLEY NATIONAL BANCORP | |||
By: | /s/ Alan D. Eskow | |||
Alan D. Eskow | ||||
Senior Executive Vice President and | ||||
Chief Financial Officer (Principal Financial Officer) | ||||
FOR IMMEDIATE RELEASE | Contact: | Alan D. Eskow | |
Senior Executive Vice President and | |||
Chief Financial Officer | |||
973-305-4003 |
• | Loans: Total non-covered loans (i.e., loans which are not subject to our loss-sharing agreements with the FDIC) increased by $195.8 million, or 7.0 percent on an annualized basis, to $11.5 billion at December 31, 2013 from September 30, 2013 largely due to solid organic commercial real estate (excluding construction) loan growth, which equaled 13.9 percent on an annualized basis, and a $38.6 million increase in automobile loans, partially offset by declines within the residential mortgage loan portfolio and the commercial real estate loan segment of our purchased credit-impaired (PCI) loans. Total covered loans (i.e., loans subject to our loss-sharing agreements with the FDIC) decreased to $96.2 million, or 0.8 percent of our total loans, at December 31, 2013 as compared to $121.5 million at September 30, 2013, mainly due to normal collection and prepayment activity. |
• | Net Interest Income and Margin: Net interest income totaling $116.1 million for the three months ended December 31, 2013 increased $4.5 million as compared to the third quarter of 2013, and decreased $2.4 million from the fourth quarter of 2012. Interest income on loans contributed approximately $2.0 million to the increase from the third quarter of 2013 largely due to a $291.6 million increase in average loans driven by strong commercial real estate loan volumes over the last six months of 2013. On a tax equivalent basis, our net interest margin increased 7 basis points to 3.27 percent in the fourth quarter of 2013 as compared to 3.20 percent for the third quarter of 2013, and decreased 14 basis points from 3.41 percent for the fourth quarter of 2012. The increase in the margin compared to the third quarter of this year was mostly caused by higher yields on our taxable investment securities portfolio as prepayment speeds and premium amortization for many of our investments continued to decline in the fourth quarter due, in part, to higher long-term market interest rates. Additionally, the cost of average long-term borrowings declined by 0.20 percent to 4.02 percent for the fourth quarter of 2013 as compared to the third quarter of |
• | Asset Quality: Total loan delinquencies (including loans past due 30 days or more and non-accrual loans) as a percentage of total loans were 1.23 percent at December 31, 2013 compared to 1.47 percent at September 30, 2013. Of the 1.23 percent in delinquencies at December 31, 2013, 0.14 percent, or $16.2 million, represented performing matured loans in the normal process of renewal. Non-accrual loans decreased to $95.1 million, or 0.82 percent of our entire loan portfolio of $11.6 billion, at December 31, 2013, compared to $116.1 million, or 1.02 percent of total loans, at September 30, 2013. The $21.0 million decrease in non-accruals was partly due to loan repayments totaling $13.5 million related to four commercial/commercial real estate relationships. Overall, our non-performing assets decreased by 35.7 percent to $124.9 million at December 31, 2013 as compared to $194.2 million at September 30, 2013 due to the aforementioned decline in non-accrual loans and a $48.6 million decrease in non-accrual debt securities at December 31, 2013. At December 31, 2013 and September 30, 2013, our non-performing assets included non-accrual debt securities with carrying values of $3.8 million and $52.3 million, respectively. Of the $52.3 million in non-accrual securities at September 30, 2013, $48.3 million of the securities (with a combined amortized cost of $41.8 million) were sold in October 2013 resulting in an aggregate realized gain of approximately $10.7 million during the fourth quarter of 2013. |
• | Provision for Losses on Non-Covered Loans and Unfunded Letters of Credit: The provision for losses on non-covered loans and unfunded letters of credit was $6.4 million for the fourth quarter of 2013 as compared to $5.3 million for the third quarter of 2013 and $5.2 million for the fourth quarter of 2012. Net loan charge-offs on non-covered loans decreased to $5.4 million for the fourth quarter of 2013 (or 0.19 percent of average loans on an annualized basis) compared to $9.1 million for the third quarter of 2013, and increased from $4.3 million for the fourth quarter of 2012. Loan charge-offs for the fourth quarter of 2013 primarily related to the valuation of certain impaired loans (with aggregate September 30, 2013 allocated reserves that exceeded such charges) at December 31, 2013. At December 31, 2013, our allowance for losses on non-covered loans and unfunded letters of credit totaled $110.0 million and was 0.96 percent of non-covered loans, as compared to 0.97 percent and 1.13 percent at September 30, 2013 and December 31, 2012, respectively. |
• | Investments: Our net gains on securities transactions were $10.7 million ($6.2 million after taxes, or $0.03 per common share) for the fourth quarter of 2013 as compared to immaterial net gains for both the third quarter of 2013 and fourth quarter of 2012. Within the available for sale investment securities portfolio, Valley had previously impaired trust preferred securities issued by one deferring bank holding company with a combined amortized cost of $41.8 million at September 30, 2013. As noted under the “Asset Quality” key highlight above, Valley sold these non-accrual debt securities for net proceeds of $52.5 million and realized a gain of $10.7 million during the fourth quarter of 2013. Additionally, we recognized no other-than-temporary impairment charges on investment securities in earnings during the fourth quarter of 2013, third quarter of 2013, and fourth quarter of 2012. |
• | Other Non-Interest Income and Expense: During the fourth quarter of 2013, we terminated a branch operating lease related to a building sale-leaseback transaction entered into during 2007. As a result of the lease termination, we recognized a gain of $11.3 million ($6.6 million after-taxes, or $0.03 per common share) within the net gains on sales of assets category of other non-interest income. The $11.3 million gain represented the outstanding deferred gain on the original building sale that would have been amortized to income over the remaining lease term. The negotiated lease termination penalty recognized in the fourth quarter of 2013 was immaterial. Additionally, net occupancy and equipment expense within other non-interest expense was reduced by $1.7 million during the fourth quarter of 2013 due to the reversal of the straight-line rent expense accrued liability related to the terminated operating lease agreement. The branch office was moved from the terminated lease location to a newly "right-sized" leased location on the same block of Manhattan. |
• | Mortgage Banking Activities: Our gains on sales of loans continued to decline from the $2.7 million recorded in the third quarter of 2013 to $1.5 million for the fourth quarter of 2013 due to the decline in consumer refinance activity in the marketplace caused by the higher level of mortgage interest rates. As a result, residential mortgage loan originations (including both new and refinanced loans) totaled only $95.7 million for the fourth quarter of 2013 and declined over 61 percent as compared to the third quarter of 2013. Valley sold approximately $50 million of residential mortgages (including $9.6 million of loans held for sale at September 30, 2013) during the fourth quarter, down 48 percent from the third quarter of 2013. Due to the current level of market interest rates, we do not expect a material change in our gains on sales of mortgage loans during the first quarter of 2014 as compared to the fourth quarter of 2013. |
• | Trading Mark to Market: Net trading gains and losses mainly represent non-cash mark to market gains and losses on our junior subordinated debentures issued to VNB Capital Trust I, which were carried at fair value prior to their early redemption in the fourth quarter of 2013. Net trading gains totaled $1.2 million for the fourth quarter of 2013 as compared to $2.2 million for both the third quarter of 2013 and fourth quarter of 2012. The $1.2 million net gain for the fourth quarter of 2013 largely resulted from the difference between the carrying value and contractual principal balance of the debentures upon redemption in October 2013. |
• | Income Tax Expense: Our effective tax rate increased to 28.9 percent for the fourth quarter of 2013 as compared to 20.8 percent for the third quarter of 2013 and 28.5 percent for the fourth quarter of 2012. The increase from the third quarter of 2013 was mainly due to the higher marginal taxes related to the increase in pre-tax income (largely driven by the net gains on securities transactions and the net gains on sales of assets noted above) for the fourth quarter of 2013. See the “Income Tax Expense” section below for additional information. |
• | Junior Subordinated Debenture Redemption: On October 25, 2013, we redeemed all of the remaining $131.3 million of the principal face amount of the 7.75 percent junior subordinated debentures issued to VNB Capital Trust I within our interest bearing liabilities and approximately $127.3 million of the principal face value of the related outstanding trust preferred securities (within Valley’s Tier 1 capital position at September 30, 2013). Based upon new final regulatory guidance, Valley’s outstanding trust preferred securities issued by all of its capital trust subsidiaries |
• | Capital Strength: Our regulatory capital ratios continue to reflect Valley’s strong capital position. The Company's total risk-based capital, Tier 1 capital, leverage capital, and Tier 1 common capital ratios were 11.87 percent, 9.65 percent, 7.27 percent and 9.28 percent, respectively, at December 31, 2013. |
December 31, 2013 | September 30, 2013 | December 31, 2012 | |||||||||||||||||||
Allocation | Allocation | Allocation | |||||||||||||||||||
as a % of | as a % of | as a % of | |||||||||||||||||||
Allowance | Loan | Allowance | Loan | Allowance | Loan | ||||||||||||||||
Allocation | Category | Allocation | Category | Allocation | Category | ||||||||||||||||
Loan Category: | |||||||||||||||||||||
Commercial and industrial loans* | $ | 54,534 | 2.73 | % | $ | 52,710 | 2.64 | % | $ | 59,260 | 2.84 | % | |||||||||
Commercial real estate loans: | |||||||||||||||||||||
Commercial real estate | 25,570 | 0.51 | % | 26,015 | 0.54 | % | 24,651 | 0.56 | % | ||||||||||||
Construction | 10,341 | 2.41 | % | 10,865 | 2.56 | % | 17,393 | 4.09 | % | ||||||||||||
Total commercial real estate loans | 35,911 | 0.66 | % | 36,880 | 0.70 | % | 42,044 | 0.87 | % | ||||||||||||
Residential mortgage loans | 7,663 | 0.31 | % | 7,904 | 0.31 | % | 9,361 | 0.38 | % | ||||||||||||
Consumer loans: | |||||||||||||||||||||
Home equity | 1,244 | 0.28 | % | 1,253 | 0.28 | % | 1,807 | 0.37 | % | ||||||||||||
Auto and other consumer | 3,112 | 0.28 | % | 2,823 | 0.27 | % | 3,735 | 0.39 | % | ||||||||||||
Total consumer loans | 4,356 | 0.28 | % | 4,076 | 0.27 | % | 5,542 | 0.38 | % | ||||||||||||
Unallocated | 7,578 | — | 7,435 | — | 6,796 | — | |||||||||||||||
Allowance for non-covered loans | |||||||||||||||||||||
and unfunded letters of credit | 110,042 | 0.96 | % | 109,005 | 0.97 | % | 123,003 | 1.13 | % | ||||||||||||
Allowance for covered loans | 7,070 | 7.35 | % | 7,070 | 5.82 | % | 9,492 | 5.25 | % | ||||||||||||
Total allowance for credit losses | $ | 117,112 | 1.01 | % | $ | 116,075 | 1.02 | % | $ | 132,495 | 1.20 | % | |||||||||
* Includes the reserve for unfunded letters of credit. |
• | a severe decline in the general economic conditions of New Jersey and the New York Metropolitan area; |
• | larger than expected reductions in our loans originated for sale or a slowdown in new and refinanced residential mortgage loan activity; |
• | unexpected changes in market interest rates for interest earning assets and/or interest bearing liabilities; |
• | government intervention in the U.S. financial system and the effects of and changes in trade and monetary and fiscal policies and laws, including the interest rate policies of the Federal Reserve; |
• | claims and litigation pertaining to fiduciary responsibility, contractual issues, environmental laws and other matters; |
• | our inability to pay dividends at current levels, or at all, because of inadequate future earnings, regulatory restrictions or limitations, and changes in the composition of qualifying regulatory capital and minimum capital requirements (including those resulting from the U.S. implementation of Basel III requirements); |
• | higher than expected increases in our allowance for loan losses; |
• | declines in value in our investment portfolio, including additional other-than-temporary impairment charges on our investment securities; |
• | unexpected significant declines in the loan portfolio due to the lack of economic expansion, increased competition, large prepayments or other factors; |
• | unanticipated credit deterioration in our loan portfolio; |
• | unanticipated loan delinquencies, loss of collateral, decreased service revenues, and other potential negative effects on our business caused by severe weather or other external events; |
• | higher than expected tax rates, including increases resulting from changes in tax laws, regulations and case law; |
• | an unexpected decline in real estate values within our market areas; |
• | higher than expected FDIC insurance assessments; |
• | the failure of other financial institutions with whom we have trading, clearing, counterparty and other financial relationships; |
• | lack of liquidity to fund our various cash obligations; |
• | unanticipated reduction in our deposit base; |
• | potential acquisitions that may disrupt our business; |
• | legislative and regulatory actions (including the impact of the Dodd-Frank Wall Street Reform and Consumer Protection Act and related regulations) subject us to additional regulatory oversight which may result in higher compliance costs and/or require us to change our business model; |
• | changes in accounting policies or accounting standards; |
• | our inability to promptly adapt to technological changes; |
• | our internal controls and procedures may not be adequate to prevent losses; |
• | the inability to realize expected revenue synergies from recent acquisitions in the amounts or in the timeframe anticipated; |
• | inability to retain customers and employees; |
• | lower than expected cash flows from purchased credit-impaired loans; |
• | cyber attacks, computer viruses or other malware that may breach the security of our websites or other systems to obtain unauthorized access to confidential information, destroy data, disable or degrade service, or sabotage our systems; and |
• | other unexpected material adverse changes in our operations or earnings. |
Three Months Ended | Years Ended | |||||||||||||||||||||
December 31, | September 30, | December 31, | December 31, | |||||||||||||||||||
($ in thousands, except for share data) | 2013 | 2013 | 2012 | 2013 | 2012 | |||||||||||||||||
FINANCIAL DATA: | ||||||||||||||||||||||
Net interest income | $ | 116,128 | $ | 111,669 | $ | 118,529 | $ | 447,720 | $ | 489,881 | ||||||||||||
Net interest income - FTE (1) | 118,040 | 113,597 | 120,409 | 455,609 | 497,098 | |||||||||||||||||
Non-interest income (2) | 42,073 | 22,390 | 33,825 | 128,653 | 120,946 | |||||||||||||||||
Non-interest expense | 96,092 | 94,461 | 95,623 | 381,338 | 374,900 | |||||||||||||||||
Income tax expense | 16,061 | 7,143 | 14,702 | 46,979 | 66,748 | |||||||||||||||||
Net income | 39,608 | 27,121 | 36,829 | 131,961 | 143,627 | |||||||||||||||||
Weighted average number of common shares outstanding: | ||||||||||||||||||||||
Basic | 199,613,524 | 199,445,874 | 197,795,817 | 199,309,425 | 197,354,159 | |||||||||||||||||
Diluted | 199,613,524 | 199,445,874 | 197,795,817 | 199,309,425 | 197,354,372 | |||||||||||||||||
Per common share data: | ||||||||||||||||||||||
Basic earnings | $ | 0.20 | $ | 0.14 | $ | 0.19 | $ | 0.66 | $ | 0.73 | ||||||||||||
Diluted earnings | 0.20 | 0.14 | 0.19 | 0.66 | 0.73 | |||||||||||||||||
Cash dividends declared | 0.11 | 0.16 | 0.16 | 0.60 | 0.65 | |||||||||||||||||
Book value | 7.72 | 7.62 | 7.57 | 7.72 | 7.57 | |||||||||||||||||
Tangible book value (3) | 5.39 | 5.28 | 5.26 | 5.39 | 5.26 | |||||||||||||||||
Tangible common equity to tangible assets (3) | 6.86 | % | 6.79 | % | 6.71 | % | 6.86 | % | 6.71 | % | ||||||||||||
Closing stock price - high | $ | 10.51 | $ | 10.65 | $ | 10.20 | $ | 10.65 | $ | 12.59 | ||||||||||||
Closing stock price - low | 9.70 | 9.53 | 8.72 | 8.85 | 8.72 | |||||||||||||||||
FINANCIAL RATIOS: | ` | |||||||||||||||||||||
Net interest margin | 3.22 | % | 3.14 | % | 3.36 | % | 3.14 | % | 3.47 | % | ||||||||||||
Net interest margin - FTE (1) | 3.27 | 3.20 | 3.41 | 3.20 | 3.52 | |||||||||||||||||
Annualized return on average assets | 0.98 | 0.68 | 0.93 | 0.83 | 0.91 | |||||||||||||||||
Annualized return on average shareholders' equity | 10.35 | 7.11 | 9.71 | 8.69 | 9.57 | |||||||||||||||||
Annualized return on average tangible shareholders' equity (3) | 14.88 | 10.24 | 13.82 | 12.51 | 13.65 | |||||||||||||||||
Efficiency ratio (4) | 60.74 | 70.46 | 62.76 | 66.16 | 61.38 | |||||||||||||||||
AVERAGE BALANCE SHEET ITEMS: | ||||||||||||||||||||||
Assets | $ | 16,188,170 | $ | 15,965,600 | $ | 15,835,049 | $ | 15,975,253 | $ | 15,833,998 | ||||||||||||
Interest earning assets | 14,441,073 | 14,203,103 | 14,115,272 | 14,242,202 | 14,109,728 | |||||||||||||||||
Loans | 11,501,510 | 11,209,929 | 11,276,804 | 11,187,968 | 11,238,269 | |||||||||||||||||
Interest bearing liabilities | 10,760,706 | 10,696,147 | 10,874,993 | 10,753,334 | 11,037,169 | |||||||||||||||||
Deposits | 11,317,584 | 11,220,558 | 11,171,248 | 11,268,322 | 11,032,021 | |||||||||||||||||
Shareholders' equity | 1,530,019 | 1,525,939 | 1,516,675 | 1,519,299 | 1,500,997 |
As Of | ||||||||||||||
December 31, | September 30, | December 31, | ||||||||||||
($ in thousands) | 2013 | 2013 | 2012 | |||||||||||
BALANCE SHEET ITEMS: | ||||||||||||||
Assets | $ | 16,156,541 | $ | 15,976,943 | $ | 16,012,646 | ||||||||
Total loans | 11,567,612 | 11,397,181 | 11,022,799 | |||||||||||
Non-covered loans | 11,471,447 | 11,275,661 | 10,842,125 | |||||||||||
Deposits | 11,319,262 | 11,120,111 | 11,264,018 | |||||||||||
Shareholders' equity | 1,541,040 | 1,520,056 | 1,502,377 | |||||||||||
CAPITAL RATIOS: | ||||||||||||||
Tier 1 leverage ratio | 7.27 | % | 8.03 | % | 8.09 | % | ||||||||
Risk-based capital - Tier 1 | 9.65 | 10.64 | 10.87 | |||||||||||
Risk-based capital - Total Capital | 11.87 | 12.87 | 12.38 | |||||||||||
Tier 1 common capital ratio (3) | 9.28 | 9.17 | 9.24 |
Three Months Ended | Years Ended | |||||||||||||||||||||
December 31, | September 30, | December 31, | December 31, | |||||||||||||||||||
($ in thousands) | 2013 | 2013 | 2012 | 2013 | 2012 | |||||||||||||||||
ALLOWANCE FOR CREDIT LOSSES: | ||||||||||||||||||||||
Beginning balance - Allowance for credit losses | $ | 116,075 | $ | 119,880 | $ | 131,597 | $ | 132,495 | $ | 136,185 | ||||||||||||
Loans charged-off: (5) | ||||||||||||||||||||||
Commercial and industrial | (2,515 | ) | (8,556 | ) | (2,241 | ) | (19,837 | ) | (16,103 | ) | ||||||||||||
Commercial real estate | (1,884 | ) | (564 | ) | (917 | ) | (7,060 | ) | (9,596 | ) | ||||||||||||
Construction | (1,633 | ) | (383 | ) | (576 | ) | (3,786 | ) | (2,092 | ) | ||||||||||||
Residential mortgage | (1,108 | ) | (780 | ) | (889 | ) | (4,446 | ) | (3,518 | ) | ||||||||||||
Consumer | (1,028 | ) | (1,723 | ) | (1,730 | ) | (5,120 | ) | (5,339 | ) | ||||||||||||
Total loans charged-off | (8,168 | ) | (12,006 | ) | (6,353 | ) | (40,249 | ) | (36,648 | ) | ||||||||||||
Charged-off loans recovered: | ||||||||||||||||||||||
Commercial and industrial | 1,176 | 1,103 | 1,565 | 4,219 | 4,475 | |||||||||||||||||
Commercial real estate | 730 | 21 | 20 | 816 | 222 | |||||||||||||||||
Construction | 54 | 875 | — | 929 | 50 | |||||||||||||||||
Residential mortgage | 400 | 230 | 63 | 768 | 701 | |||||||||||||||||
Consumer | 405 | 638 | 403 | 2,039 | 1,958 | |||||||||||||||||
Total loans recovered | 2,765 | 2,867 | 2,051 | 8,771 | 7,406 | |||||||||||||||||
Net charge-offs | (5,403 | ) | (9,139 | ) | (4,302 | ) | (31,478 | ) | (29,242 | ) | ||||||||||||
Provision charged for credit losses | 6,440 | 5,334 | 5,200 | 16,095 | 25,552 | |||||||||||||||||
Ending balance - Allowance for credit losses | $ | 117,112 | $ | 116,075 | $ | 132,495 | $ | 117,112 | $ | 132,495 | ||||||||||||
Components of allowance for credit losses: | ||||||||||||||||||||||
Allowance for non-covered loans | $ | 106,547 | $ | 105,515 | $ | 120,708 | $ | 106,547 | $ | 120,708 | ||||||||||||
Allowance for covered loans | 7,070 | 7,070 | 9,492 | 7,070 | 9,492 | |||||||||||||||||
Allowance for loan losses | 113,617 | 112,585 | 130,200 | 113,617 | 130,200 | |||||||||||||||||
Allowance for unfunded letters of credit | 3,495 | 3,490 | 2,295 | 3,495 | 2,295 | |||||||||||||||||
Allowance for credit losses | $ | 117,112 | $ | 116,075 | $ | 132,495 | $ | 117,112 | $ | 132,495 | ||||||||||||
Components of provision for credit losses: | ||||||||||||||||||||||
Provision for losses on non-covered loans | $ | 6,435 | $ | 4,280 | $ | 5,255 | $ | 17,171 | $ | 25,640 | ||||||||||||
Provision for losses on covered loans | — | — | — | (2,276 | ) | — | ||||||||||||||||
Provision for unfunded letters of credit | 5 | 1,054 | (55 | ) | 1,200 | (88 | ) | |||||||||||||||
Provision for credit losses | $ | 6,440 | $ | 5,334 | $ | 5,200 | $ | 16,095 | $ | 25,552 | ||||||||||||
Annualized ratio of net charge-offs of | ||||||||||||||||||||||
non-covered loans to average loans | 0.19 | % | 0.33 | % | 0.15 | % | 0.28 | % | 0.22 | % | ||||||||||||
Annualized ratio of total net charge-offs | ||||||||||||||||||||||
to average loans | 0.19 | 0.33 | 0.15 | 0.28 | 0.26 | |||||||||||||||||
Allowance for non-covered loan losses as | ||||||||||||||||||||||
a % of non-covered loans | 0.93 | 0.94 | 1.11 | 0.93 | 1.11 | |||||||||||||||||
Allowance for credit losses as | ||||||||||||||||||||||
a % of total loans | 1.01 | 1.02 | 1.20 | 1.01 | 1.20 |
As Of | ||||||||||||||
($ in thousands) | December 31, | September 30, | December 31, | |||||||||||
ASSET QUALITY: (6) | 2013 | 2013 | 2012 | |||||||||||
Accruing past due loans: | ||||||||||||||
30 to 59 days past due: | ||||||||||||||
Commercial and industrial | $ | 6,398 | $ | 3,065 | $ | 3,397 | ||||||||
Commercial real estate | 9,142 | 6,276 | 11,214 | |||||||||||
Construction | 1,186 | — | 1,793 | |||||||||||
Residential mortgage | 6,595 | 8,221 | 13,730 | |||||||||||
Consumer | 3,792 | 3,773 | 5,887 | |||||||||||
Total 30 to 59 days past due | 27,113 | 21,335 | 36,021 | |||||||||||
60 to 89 days past due: | ||||||||||||||
Commercial and industrial | 571 | 957 | 181 | |||||||||||
Commercial real estate | 2,442 | 23,828 | 2,031 | |||||||||||
Construction | 4,577 | — | 4,892 | |||||||||||
Residential mortgage | 1,939 | 1,857 | 5,221 | |||||||||||
Consumer | 784 | 864 | 1,340 | |||||||||||
Total 60 to 89 days past due | 10,313 | 27,506 | 13,665 | |||||||||||
90 or more days past due: | ||||||||||||||
Commercial and industrial | 233 | 342 | 283 | |||||||||||
Commercial real estate | 7,591 | 232 | 2,950 | |||||||||||
Construction | — | — | 2,575 | |||||||||||
Residential mortgage | 1,549 | 1,980 | 2,356 | |||||||||||
Consumer | 118 | 235 | 501 | |||||||||||
Total 90 or more days past due | 9,491 | 2,789 | 8,665 | |||||||||||
Total accruing past due loans | $ | 46,917 | $ | 51,630 | $ | 58,351 | ||||||||
Non-accrual loans: | ||||||||||||||
Commercial and industrial | $ | 21,029 | $ | 23,941 | $ | 22,424 | ||||||||
Commercial real estate | 43,934 | 53,752 | 58,625 | |||||||||||
Construction | 8,116 | 13,070 | 14,805 | |||||||||||
Residential mortgage | 19,949 | 23,414 | 32,623 | |||||||||||
Consumer | 2,035 | 1,906 | 3,331 | |||||||||||
Total non-accrual loans | 95,063 | 116,083 | 131,808 | |||||||||||
Other real estate owned (7) | 19,580 | 19,372 | 15,612 | |||||||||||
Other repossessed assets | 6,447 | 6,378 | 7,805 | |||||||||||
Non-accrual debt securities (8) | 3,771 | 52,334 | 40,303 | |||||||||||
Total non-performing assets ("NPAs") | $ | 124,861 | $ | 194,167 | $ | 195,528 | ||||||||
Performing troubled debt restructured loans | $ | 107,037 | $ | 116,852 | $ | 105,446 | ||||||||
Total non-accrual loans as a % of loans | 0.82 | % | 1.02 | % | 1.20 | % | ||||||||
Total accruing past due and non-accrual loans | ||||||||||||||
as a % of loans | 1.23 | 1.47 | 1.73 | |||||||||||
Allowance for losses on non-covered loans as a % of | ||||||||||||||
non-accrual loans | 112.08 | 90.90 | 91.58 | |||||||||||
Non-performing purchased credit-impaired loans: (9) | ||||||||||||||
Non-covered loans | $ | 24,988 | $ | 28,926 | $ | 24,028 | ||||||||
Covered loans | 21,758 | 36,593 | 47,831 |
(1) | Net interest income and net interest margin are presented on a tax equivalent basis using a 35 percent federal tax rate. Valley believes that this presentation provides comparability of net interest income and net interest margin arising from both taxable and tax-exempt sources and is consistent with industry practice and SEC rules. |
(2) | Non-interest income includes net trading gains (losses): |
Three Months Ended | Years Ended | ||||||||||||||||||
December 31, | September 30, | December 31 | December 31, | ||||||||||||||||
2013 | 2013 | 2013 | 2013 | 2012 | |||||||||||||||
(in thousands) | |||||||||||||||||||
Trading securities | $ | (6 | ) | $ | 100 | $ | 53 | $ | 28 | $ | 219 | ||||||||
Junior subordinated debentures | 1,156 | 2,131 | 2,113 | 881 | 2,574 | ||||||||||||||
Total trading gains, net | $ | 1,150 | $ | 2,231 | $ | 2,166 | $ | 909 | $ | 2,793 |
(3) | This press release contains certain supplemental financial information, described in the Notes below, which has been determined by methods other than U.S. Generally Accepted Accounting Principles ("GAAP") that management uses in its analysis of Valley's performance. Management believes these non-GAAP financial measures provide information useful to investors in understanding Valley's financial results. Specifically, Valley provides measures based on what it believes are its operating earnings on a consistent basis and excludes material non-core operating items which affect the GAAP reporting of results of operations. Management utilizes these measures for internal planning and forecasting purposes. Management believes that Valley's presentation and discussion, together with the accompanying reconciliations, provides a complete understanding of factors and trends affecting Valley's business and allows investors to view performance in a manner similar to management. These non-GAAP measures should not be considered a substitute for GAAP basis measures and results and Valley strongly encourages investors to review its consolidated financial statements in their a substitute for GAAP basis measures and results and Valley strongly encourages investors to review its consolidated financial statements in their entirety and not to rely on any single financial measure. Because non-GAAP financial measures are not standardized, it may not be possible to compare these financial measures with other companies' non-GAAP financial measures having the same or similar names. |
As of and For the Period Ended | |||||||||||
December 31, | September 30, | December 31, | |||||||||
($ in thousands) | 2013 | 2013 | 2012 | ||||||||
Tier 1 common: | |||||||||||
Total equity | $ | 1,541,040 | $ | 1,520,056 | $ | 1,502,377 | |||||
Plus (less): | |||||||||||
Net unrealized losses on securities available for sale, net of tax | 21,661 | 13,436 | 3,269 | ||||||||
Accumulated net losses on cash flow hedges, net of tax | 6,271 | 10,547 | 12,676 | ||||||||
Defined benefit pension plan net assets, net of tax | 10,320 | 14,187 | 34,964 | ||||||||
Goodwill, net of tax | (427,392 | ) | (427,392 | ) | (427,392 | ) | |||||
Disallowed other intangible assets | (13,122 | ) | (14,060 | ) | (15,879 | ) | |||||
Disallowed deferred tax assets | (41,252 | ) | (45,719 | ) | (55,012 | ) | |||||
Tier 1 common capital | 1,097,526 | 1,071,055 | 1,055,003 | ||||||||
Trust preferred securities | 44,000 | 171,313 | 186,313 | ||||||||
Total Tier 1 capital* | $ | 1,141,526 | $ | 1,242,368 | $ | 1,241,316 | |||||
Risk-weighted assets (under Federal Reserve Board | |||||||||||
Capital Regulatory Guidelines (RWA)) | $ | 11,830,604 | $ | 11,678,126 | $ | 11,417,521 | |||||
Tier 1 capital ratio (Total Tier 1 capital / RWA) | 9.65 | % | 10.64 | % | 10.87 | % | |||||
Tier 1 common capital ratio (Total Tier 1 common / RWA) | 9.28 | % | 9.17 | % | 9.24 | % |
* | Tier 1 Capital excludes net unrealized gains (losses) on available-for-sale debt securities and net unrealized gains on available-for-sale equity securities with readily determinable fair values, in accordance with regulatory risk-based capital guidelines. In arriving at Tier 1 Capital, institutions are required to deduct net unrealized losses on available-for-sale equity securities with readily determinable fair values, net of tax. |
Three Months Ended | Years Ended | ||||||||||||||||||
December 31, | September 30, | December 31, | December 31, | ||||||||||||||||
($ in thousands, except for share data) | 2013 | 2013 | 2012 | 2013 | 2012 | ||||||||||||||
Tangible book value per common share: | |||||||||||||||||||
Common shares outstanding | 199,593,109 | 199,450,531 | 198,438,271 | 199,593,109 | 198,438,271 | ||||||||||||||
Shareholders' equity | $ | 1,541,040 | $ | 1,520,056 | $ | 1,502,377 | $ | 1,541,040 | $ | 1,502,377 | |||||||||
Less: Goodwill and other intangible assets | (464,364 | ) | (466,193 | ) | (459,357 | ) | (464,364 | ) | (459,357 | ) | |||||||||
Tangible shareholders' equity | $ | 1,076,676 | $ | 1,053,863 | $ | 1,043,020 | $ | 1,076,676 | $ | 1,043,020 | |||||||||
Tangible book value | $ | 5.39 | $ | 5.28 | $ | 5.26 | $ | 5.39 | $ | 5.26 | |||||||||
Tangible common equity to tangible assets: | |||||||||||||||||||
Tangible shareholders' equity | $ | 1,076,676 | $ | 1,053,863 | $ | 1,043,020 | $ | 1,076,676 | $ | 1,043,020 | |||||||||
Total assets | 16,156,541 | 15,976,943 | 16,012,646 | 16,156,541 | 16,012,646 | ||||||||||||||
Less: Goodwill and other intangible assets | (464,364 | ) | (466,193 | ) | (459,357 | ) | (464,364 | ) | (459,357 | ) | |||||||||
Tangible assets | $ | 15,692,177 | $ | 15,510,750 | $ | 15,553,289 | $ | 15,692,177 | $ | 15,553,289 | |||||||||
Tangible common equity to tangible assets | 6.86 | % | 6.79 | % | 6.71 | % | 6.86 | % | 6.71 | % | |||||||||
Annualized return on average tangible equity: | |||||||||||||||||||
Net income | $ | 39,608 | $ | 27,121 | $ | 36,829 | $ | 131,961 | $ | 143,627 | |||||||||
Average shareholders' equity | 1,530,019 | 1,525,939 | 1,516,675 | 1,519,299 | 1,500,997 | ||||||||||||||
Less: Average goodwill and other intangible assets | (464,939 | ) | (466,495 | ) | (450,948 | ) | (464,085 | ) | (449,078 | ) | |||||||||
Average tangible shareholders' equity | $ | 1,065,080 | $ | 1,059,444 | $ | 1,065,727 | $ | 1,055,214 | $ | 1,051,919 | |||||||||
Annualized return on average tangible | |||||||||||||||||||
shareholders' equity | 14.88 | % | 10.24 | % | 13.82 | % | 12.51 | % | 13.65 | % |
(4) | The efficiency ratio measures Valley's total non-interest expense as a percentage of net interest income plus total non-interest income. |
(5) | Total loans charged-off includes the following covered loan charge-offs: |
Three Months Ended | Years Ended | ||||||||||||||||||
December 31, | September 30, | December 31, | December 31, | ||||||||||||||||
(In thousands) | 2013 | 2013 | 2012 | 2013 | 2012 | ||||||||||||||
Commercial and industrial | $ | — | $ | — | $ | — | $ | (84 | ) | $ | (3,551 | ) | |||||||
Construction | — | — | — | — | (484 | ) | |||||||||||||
Residential mortgage | — | — | — | (62 | ) | — | |||||||||||||
Total covered loans charged-off | $ | — | $ | — | $ | — | $ | (146 | ) | $ | (4,035 | ) |
(6) | Past due loans and non-accrual loans exclude loans that were acquired as part of FDIC-assisted transactions (covered loans) and acquired or purchased loans during 2012. These loans are accounted for on a pool basis under U.S. GAAP and are not subject to delinquency classification in the same manner as loans originated by Valley. |
(7) | Excludes OREO properties related to FDIC-assisted transactions totaling $12.3 million, $9.3 million and $8.9 million, at December 31, 2013, September 30, 2013 and December 31, 2012, respectively. These assets are covered by the loss-sharing agreements with the FDIC. |
(8) | Includes other-than-temporarily impaired trust preferred securities classified as available for sale, which are presented at carrying value (net of unrealized gains (losses) totaling ($1.6) million, $5.2 million and ($6.9) million at December 31, 2013, September 30, 2013 and December 31, 2012, respectively) after recognition of all credit impairments. |
(9) | Represent acquired and purchased loans meeting Valley's definition of non-performing loan (i.e., non-accrual loans), but are not subject to such classification under U.S. GAAP because the loans are accounted for on a pooled basis and are excluded from the non-accrual loans in the table above. |
December 31, | |||||||||||
2013 | 2012 | ||||||||||
Assets | |||||||||||
Cash and due from banks | $ | 234,253 | $ | 390,078 | |||||||
Interest bearing deposits with banks | 134,915 | 463,022 | |||||||||
Investment securities: | |||||||||||
Held to maturity, fair value of $1,711,427 at December 31, 2013 and $1,657,950 at December 31, 2012 | 1,731,737 | 1,599,707 | |||||||||
Available for sale | 829,692 | 807,816 | |||||||||
Trading securities | 14,264 | 22,157 | |||||||||
Total investment securities | 2,575,693 | 2,429,680 | |||||||||
Loans held for sale, at fair value | 10,488 | 120,230 | |||||||||
Non-covered loans | 11,471,447 | 10,842,125 | |||||||||
Covered loans | 96,165 | 180,674 | |||||||||
Less: Allowance for loan losses | (113,617 | ) | (130,200 | ) | |||||||
Net loans | 11,453,995 | 10,892,599 | |||||||||
Premises and equipment, net | 270,138 | 278,615 | |||||||||
Bank owned life insurance | 344,023 | 339,876 | |||||||||
Accrued interest receivable | 53,964 | 52,375 | |||||||||
Due from customers on acceptances outstanding | 5,032 | 3,323 | |||||||||
FDIC loss-share receivable | 32,757 | 44,996 | |||||||||
Goodwill | 428,234 | 428,234 | |||||||||
Other intangible assets, net | 36,130 | 31,123 | |||||||||
Other assets | 576,919 | 538,495 | |||||||||
Total Assets | $ | 16,156,541 | $ | 16,012,646 | |||||||
Liabilities | |||||||||||
Deposits: | |||||||||||
Non-interest bearing | $ | 3,717,271 | $ | 3,558,053 | |||||||
Interest bearing: | |||||||||||
Savings, NOW and money market | 5,422,722 | 5,197,199 | |||||||||
Time | 2,179,269 | 2,508,766 | |||||||||
Total deposits | 11,319,262 | 11,264,018 | |||||||||
Short-term borrowings | 281,455 | 154,323 | |||||||||
Long-term borrowings | 2,792,306 | 2,697,299 | |||||||||
Junior subordinated debentures issued to capital trusts (includes fair value | |||||||||||
of $147,595 at December 31, 2012 for VNB Capital Trust I) | 41,089 | 188,522 | |||||||||
Bank acceptances outstanding | 5,032 | 3,323 | |||||||||
Accrued expenses and other liabilities | 176,357 | 202,784 | |||||||||
Total Liabilities | 14,615,501 | 14,510,269 | |||||||||
Shareholders' Equity | |||||||||||
Preferred stock, no par value, authorized 30,000,000 shares; none issued | — | — | |||||||||
Common stock, no par value, authorized 232,023,233 shares; issued 199,629,268 shares | |||||||||||
at December 31, 2013 and 198,499,275 shares at December 31, 2012 | 69,941 | 69,494 | |||||||||
Surplus | 1,403,375 | 1,390,851 | |||||||||
Retained earnings | 106,340 | 93,495 | |||||||||
Accumulated other comprehensive loss | (38,252 | ) | (50,909 | ) | |||||||
Treasury stock, at cost (36,159 common shares at December 31, 2013 and 61,004 | |||||||||||
common shares at December 31, 2012) | (364 | ) | (554 | ) | |||||||
Total Shareholders' Equity | 1,541,040 | 1,502,377 | |||||||||
Total Liabilities and Shareholders' Equity | $ | 16,156,541 | $ | 16,012,646 |
Three Months Ended | Years Ended | ||||||||||||||||||||||
December 31, | September 30, | December 31, | December 31, | ||||||||||||||||||||
2013 | 2013 | 2012 | 2013 | 2012 | |||||||||||||||||||
Interest Income | |||||||||||||||||||||||
Interest and fees on loans | $ | 136,176 | $ | 134,160 | $ | 143,413 | $ | 537,301 | $ | 581,696 | |||||||||||||
Interest and dividends on investment securities: | |||||||||||||||||||||||
Taxable | 15,538 | 14,440 | 14,100 | 57,392 | 68,698 | ||||||||||||||||||
Tax-exempt | 3,538 | 3,566 | 3,387 | 14,426 | 13,157 | ||||||||||||||||||
Dividends | 1,539 | 1,517 | 1,816 | 6,240 | 7,107 | ||||||||||||||||||
Interest on federal funds sold and other short-term investments | 124 | 96 | 253 | 738 | 535 | ||||||||||||||||||
Total interest income | 156,915 | 153,779 | 162,969 | 616,097 | 671,193 | ||||||||||||||||||
Interest Expense | |||||||||||||||||||||||
Interest on deposits: | |||||||||||||||||||||||
Savings, NOW and money market | 4,433 | 4,359 | 4,995 | 17,863 | 20,090 | ||||||||||||||||||
Time | 6,744 | 7,279 | 8,779 | 29,928 | 37,466 | ||||||||||||||||||
Interest on short-term borrowings | 212 | 94 | 209 | 590 | 1,387 | ||||||||||||||||||
Interest on long-term borrowings and junior subordinated debentures | 29,398 | 30,378 | 30,457 | 119,996 | 122,369 | ||||||||||||||||||
Total interest expense | 40,787 | 42,110 | 44,440 | 168,377 | 181,312 | ||||||||||||||||||
Net Interest Income | 116,128 | 111,669 | 118,529 | 447,720 | 489,881 | ||||||||||||||||||
Provision for losses on non-covered loans and unfunded letters of credit | 6,440 | 5,334 | 5,200 | 18,371 | 25,552 | ||||||||||||||||||
Provision for losses on covered loans | — | — | — | (2,276 | ) | — | |||||||||||||||||
Net Interest Income After Provision for Credit Losses | 109,688 | 106,335 | 113,329 | 431,625 | 464,329 | ||||||||||||||||||
Non-Interest Income | |||||||||||||||||||||||
Trust and investment services | 2,238 | 2,138 | 1,985 | 8,610 | 7,690 | ||||||||||||||||||
Insurance commissions | 3,631 | 4,224 | 3,547 | 15,907 | 15,494 | ||||||||||||||||||
Service charges on deposit accounts | 6,241 | 6,362 | 6,207 | 24,115 | 24,752 | ||||||||||||||||||
Gains on securities transactions, net | 10,670 | 9 | 44 | 14,678 | 2,587 | ||||||||||||||||||
Other-than-temporary impairment losses on securities | — | — | — | — | — | ||||||||||||||||||
Portion recognized in other comprehensive income (before taxes) | — | — | — | — | (5,247 | ) | |||||||||||||||||
Net impairment losses on securities recognized in earnings | — | — | — | — | (5,247 | ) | |||||||||||||||||
Trading gains, net | 1,150 | 2,231 | 2,166 | 909 | 2,793 | ||||||||||||||||||
Fees from loan servicing | 1,931 | 1,851 | 1,362 | 7,020 | 4,843 | ||||||||||||||||||
Gains on sales of loans, net | 1,540 | 2,729 | 15,636 | 33,695 | 46,998 | ||||||||||||||||||
Gains (losses) on sales of assets, net | 11,547 | (1,010 | ) | (812 | ) | 10,947 | (329 | ) | |||||||||||||||
Bank owned life insurance | 1,644 | 1,553 | 1,590 | 5,962 | 6,855 | ||||||||||||||||||
Change in FDIC loss-share receivable | (1,247 | ) | (2,005 | ) | 43 | (8,427 | ) | (7,459 | ) | ||||||||||||||
Other | 2,728 | 4,308 | 2,057 | 15,237 | 21,969 | ||||||||||||||||||
Total non-interest income | 42,073 | 22,390 | 33,825 | 128,653 | 120,946 | ||||||||||||||||||
Non-Interest Expense | |||||||||||||||||||||||
Salary and employee benefits expense | 48,671 | 47,434 | 48,461 | 194,410 | 199,968 | ||||||||||||||||||
Net occupancy and equipment expense | 16,136 | 18,430 | 19,514 | 71,634 | 71,245 | ||||||||||||||||||
FDIC insurance assessment | 3,931 | 3,909 | 3,550 | 16,767 | 14,292 | ||||||||||||||||||
Amortization of other intangible assets | 2,464 | 2,264 | 2,597 | 8,258 | 9,783 | ||||||||||||||||||
Professional and legal fees | 4,202 | 4,112 | 4,565 | 16,491 | 15,005 | ||||||||||||||||||
Advertising | 1,272 | 1,203 | 1,851 | 6,127 | 7,103 | ||||||||||||||||||
Other | 19,416 | 17,109 | 15,085 | 67,651 | 57,504 | ||||||||||||||||||
Total non-interest expense | 96,092 | 94,461 | 95,623 | 381,338 | 374,900 | ||||||||||||||||||
Income Before Income Taxes | 55,669 | 34,264 | 51,531 | 178,940 | 210,375 | ||||||||||||||||||
Income tax expense | 16,061 | 7,143 | 14,702 | 46,979 | 66,748 | ||||||||||||||||||
Net Income | $ | 39,608 | $ | 27,121 | $ | 36,829 | $ | 131,961 | $ | 143,627 | |||||||||||||
Earnings Per Common Share: | |||||||||||||||||||||||
Basic | $ | 0.20 | $ | 0.14 | $ | 0.19 | $ | 0.66 | $ | 0.73 | |||||||||||||
Diluted | 0.20 | 0.14 | 0.19 | 0.66 | 0.73 | ||||||||||||||||||
Cash Dividends Declared per Common Share | 0.11 | 0.16 | 0.16 | 0.60 | 0.65 | ||||||||||||||||||
Weighted Average Number of Common Shares Outstanding: | |||||||||||||||||||||||
Basic | 199,613,524 | 199,445,874 | 197,795,817 | 199,309,425 | 197,354,159 | ||||||||||||||||||
Diluted | 199,613,524 | 199,445,874 | 197,795,817 | 199,309,425 | 197,354,372 |
VALLEY NATIONAL BANCORP | ||||||||||||||||||||||
LOAN PORTFOLIO | ||||||||||||||||||||||
(in thousands) | 12/31/2013 | 9/30/2013 | 6/30/2013 | 3/31/2013 | 12/31/2012 | |||||||||||||||||
Non-covered Loans | ||||||||||||||||||||||
Commercial and industrial | $ | 1,995,084 | $ | 1,997,353 | $ | 1,988,404 | $ | 2,045,514 | $ | 2,084,826 | ||||||||||||
Commercial real estate: | ||||||||||||||||||||||
Commercial real estate | 4,981,675 | 4,814,670 | 4,437,712 | 4,351,291 | 4,417,709 | |||||||||||||||||
Construction | 429,231 | 423,789 | 426,891 | 438,674 | 425,444 | |||||||||||||||||
Total commercial real estate | 5,410,906 | 5,238,459 | 4,864,603 | 4,789,965 | 4,843,153 | |||||||||||||||||
Residential mortgage | 2,499,965 | 2,532,370 | 2,412,968 | 2,352,560 | 2,462,429 | |||||||||||||||||
Consumer: | ||||||||||||||||||||||
Home equity | 449,009 | 449,309 | 455,166 | 462,297 | 485,458 | |||||||||||||||||
Automobile | 901,399 | 862,843 | 835,271 | 811,060 | 786,528 | |||||||||||||||||
Other consumer | 215,084 | 195,327 | 184,796 | 188,827 | 179,731 | |||||||||||||||||
Total consumer loans | 1,565,492 | 1,507,479 | 1,475,233 | 1,462,184 | 1,451,717 | |||||||||||||||||
Total non-covered loans | $ | 11,471,447 | $ | 11,275,661 | $ | 10,741,208 | $ | 10,650,223 | $ | 10,842,125 | ||||||||||||
Covered loans* | 96,165 | 121,520 | 141,817 | 161,276 | 180,674 | |||||||||||||||||
Total loans | $ | 11,567,612 | $ | 11,397,181 | $ | 10,883,025 | $ | 10,811,499 | $ | 11,022,799 | ||||||||||||
_________________________ | ||||||||||||||||||||||
* | Loans that Valley National Bank will share losses with the FDIC are referred to as "covered loans". |
VALLEY NATIONAL BANCORP | |||||||||||||||||||||||||||||||||||
Quarterly Analysis of Average Assets, Liabilities and Shareholders' Equity and | |||||||||||||||||||||||||||||||||||
Net Interest Income on a Tax Equivalent Basis | |||||||||||||||||||||||||||||||||||
Quarter End - 12/31/2013 | Quarter End - 09/30/2013 | Quarter End - 12/31/2012 | |||||||||||||||||||||||||||||||||
Average | Avg. | Average | Avg. | Average | Avg. | ||||||||||||||||||||||||||||||
($ in thousands) | Balance | Interest | Rate | Balance | Interest | Rate | Balance | Interest | Rate | ||||||||||||||||||||||||||
Assets | |||||||||||||||||||||||||||||||||||
Interest earning assets | |||||||||||||||||||||||||||||||||||
Loans (1)(2) | $ | 11,501,510 | $ | 136,183 | 4.74 | % | $ | 11,209,929 | $ | 134,168 | 4.79 | % | $ | 11,276,804 | $ | 143,470 | 5.09 | % | |||||||||||||||||
Taxable investments (3) | 2,169,989 | 17,077 | 3.15 | % | 2,271,825 | 15,957 | 2.81 | % | 1,931,717 | 15,916 | 3.30 | % | |||||||||||||||||||||||
Tax-exempt investments (1)(3) | 561,370 | 5,443 | 3.88 | % | 568,420 | 5,486 | 3.86 | % | 505,156 | 5,210 | 4.13 | % | |||||||||||||||||||||||
Federal funds sold and other | |||||||||||||||||||||||||||||||||||
interest bearing deposits | 208,204 | 124 | 0.24 | % | 152,929 | 96 | 0.25 | % | 401,595 | 253 | 0.25 | % | |||||||||||||||||||||||
Total interest earning assets | 14,441,073 | 158,827 | 4.40 | % | 14,203,103 | 155,707 | 4.39 | % | 14,115,272 | 164,849 | 4.67 | % | |||||||||||||||||||||||
Other assets | 1,747,097 | 1,762,497 | 1,719,777 | ||||||||||||||||||||||||||||||||
Total assets | $ | 16,188,170 | $ | 15,965,600 | $ | 15,835,049 | |||||||||||||||||||||||||||||
Liabilities and shareholders' equity | |||||||||||||||||||||||||||||||||||
Interest bearing liabilities: | |||||||||||||||||||||||||||||||||||
Savings, NOW and money market deposits | $ | 5,452,246 | $ | 4,433 | 0.33 | % | $ | 5,393,914 | $ | 4,359 | 0.32 | % | $ | 5,163,073 | $ | 4,995 | 0.39 | % | |||||||||||||||||
Time deposits | 2,187,372 | 6,744 | 1.23 | % | 2,274,061 | 7,279 | 1.28 | % | 2,625,681 | 8,779 | 1.34 | % | |||||||||||||||||||||||
Short-term borrowings | 199,221 | 212 | 0.43 | % | 147,658 | 94 | 0.25 | % | 197,442 | 209 | 0.42 | % | |||||||||||||||||||||||
Long-term borrowings (4) | 2,921,867 | 29,398 | 4.02 | % | 2,880,514 | 30,378 | 4.22 | % | 2,888,797 | 30,457 | 4.22 | % | |||||||||||||||||||||||
Total interest bearing liabilities | 10,760,706 | 40,787 | 1.52 | % | 10,696,147 | 42,110 | 1.57 | % | 10,874,993 | 44,440 | 1.63 | % | |||||||||||||||||||||||
Non-interest bearing deposits | 3,677,966 | 3,552,583 | 3,382,494 | ||||||||||||||||||||||||||||||||
Other liabilities | 219,479 | 190,931 | 60,887 | ||||||||||||||||||||||||||||||||
Shareholders' equity | 1,530,019 | 1,525,939 | 1,516,675 | ||||||||||||||||||||||||||||||||
Total liabilities and shareholders' equity | $ | 16,188,170 | $ | 15,965,600 | $ | 15,835,049 | |||||||||||||||||||||||||||||
Net interest income/interest rate spread (5) | $ | 118,040 | 2.88 | % | $ | 113,597 | 2.82 | % | $ | 120,409 | 3.04 | % | |||||||||||||||||||||||
Tax equivalent adjustment | (1,912 | ) | (1,928 | ) | (1,880 | ) | |||||||||||||||||||||||||||||
Net interest income, as reported | $ | 116,128 | $ | 111,669 | $ | 118,529 | |||||||||||||||||||||||||||||
Net interest margin (6) | 3.22 | % | 3.14 | % | 3.36 | % | |||||||||||||||||||||||||||||
Tax equivalent effect | 0.05 | % | 0.06 | % | 0.05 | % | |||||||||||||||||||||||||||||
Net interest margin on a fully tax equivalent basis (6) | 3.27 | % | 3.20 | % | 3.41 | % | |||||||||||||||||||||||||||||
_________________________ |
(1) | Interest income is presented on a tax equivalent basis using a 35 percent federal tax rate. |
(2) | Loans are stated net of unearned income and include non-accrual loans. |
(3) | The yield for securities that are classified as available for sale is based on the average historical amortized cost. |
(4) | Includes junior subordinated debentures issued to capital trusts which are presented separately on the consolidated statements of condition. |
(5) | Interest rate spread represents the difference between the average yield on interest earning assets and the average cost of interest bearing liabilities and is presented on a fully tax equivalent basis. |
(6) | Net interest income as a percentage of total average interest earning assets. |
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