EX-99.1 2 y81865exv99w1.htm EX-99.1 exv99w1
Exhibit 99.1
(LETTER HEAD)
     
FOR IMMEDIATE RELEASE
  CONTACT
Hudson Valley Holding Corp.
  James J. Landy
21 Scarsdale Road
  President & CEO
Yonkers, NY 10707
  (914) 771-3230
 
    
 
  Stephen R. Brown
 
  Sr. EVP, CFO & Treasurer
 
  (914) 771-3212
HUDSON VALLEY HOLDING CORP ANNOUNCES EARNINGS FOR THE
FOURTH QUARTER AND YEAR OF 2009
Yonkers, NY, February 1, 2010 ... Hudson Valley Holding Corp. (NASDAQ:HUVL), parent of Hudson Valley Bank and New York National Bank, has announced earnings of $5.2 million for the fourth quarter of 2009, compared to $5.5 million for the same period in 2008, and compared to $6.9 million for the third quarter of 2009. Diluted earnings per share totaled $0.34 for the fourth quarter of 2009, compared to $0.45 for the same period in 2008 and compared to $0.58 for the third quarter of 2009. The fourth quarter 2009 results reflected continuation of difficult but moderating credit trends, as compared to the third quarter of 2009, a stable net interest margin and modest loan and core deposit growth.
For the year ended December 31, 2009, net income was $19.0 million compared to $30.9 million for the year ended December 31, 2008. Diluted earnings per share totaled $1.50 for the year ended December 31, 2009 compared to $2.50 for the year ended December 31, 2008.
“2009 has been a challenging year as we dealt with the negative effects of the current economic environment. Considering the economic and financial crisis this past year, we are pleased with our financial results for the quarter and for the full year,” Mr. Landy said. “Our core business continues to perform very well. Deposits grew a robust 18 percent during 2009, as total deposits eclipsed $2 billion for the first time. Our core deposit growth continued during the fourth quarter totaling $29 million.” Mr. Landy stated that new customer acquisitions and enhancements to existing customer relationships remain Hudson Valley’s primary focus and were key factors contributing to

 

 

the deposit growth. “Customers have shown through their actions that they value Hudson Valley’s brand of community banking.”
“We believe in investing in the future,” Mr. Landy commented. “During the 2009, we opened three new branches, giving us 36 branches throughout the New York metropolitan area. We were also able to recruit banking professionals which enhanced the skills and experience of our existing team.” He went on to say “This type of investment will continue to provide us with future growth of our core business and is a critical element of our long term strategic plan.” Mr. Landy added, “The capital raise we completed during the fourth quarter adds to our financial strength and provides capital to support our continued growth.”
Net income for the three month period ended December 31, 2009 was $5.2 million or $0.34 per diluted share, a decrease of $0.3 million or 5.5 percent compared to $5.5 million or $0.45 per diluted share for the three month period ended December 31, 2008. Net income for the year ended December 31, 2009 was $19.0 million or $1.50 per diluted share, a decrease of $11.9 million or 38.5 percent compared to $30.9 million or $2.50 per diluted share for the year ended December 31, 2008. Per share amounts for the 2008 periods have been adjusted to reflect the effects of the 10% stock dividend issued in December 2009. Net interest income increased slightly for both the three month period and the full year ended December 31, 2009 compared to the same periods in the prior year. Although the Company was able to sustain and grow net interest income, it experienced a significant decline in net income for the year ended December 31, 2009, compared to the prior year. This decline resulted primarily from sharply higher provisions for loan losses, significant charges for impairment of certain investments, significant increase in FDIC deposit insurance premiums, and lower investment advisory fee income. To partially offset these negative impacts on net income, all of which were directly related to the current economic downturn, management eliminated all incentive compensation and bonuses for the banks in 2009.
Total deposits increased $333.3 million during the year ended December 31, 2009. Approximately $101 million of this growth resulted from the transfer of certain money market mutual fund investments of existing customers to interest bearing demand deposits. This transfer was primarily due to the increase in FDIC insurance coverage of certain deposit products which was part of the legislation enacted in response to the current economic crisis. In addition to the above mentioned deposit growth, the Company also experienced significant growth in new customers both in existing branches and new branches added during 2008 and 2009. This growth was partially offset by some declines in balances of existing customers, primarily those customers directly involved in or supported by the real estate industry. Proceeds from deposit growth were used primarily to reduce long term and short term borrowings and to fund loan growth.
Total loans increased $111.1 million during the year ended December 31, 2009 as the Company continued to provide lending availability to new and existing customers. This growth, however, was accompanied by a continued slowdown in payments of certain loans, such as construction loans, whose repayment is often dependent on sales of completed real estate projects, as well as additional increases in delinquent and

 

 

nonperforming loans in other sectors of the loan portfolio which have also been adversely impacted by the severe economic conditions currently affecting the real estate markets.
The Company’s noninterest income decreased in 2009, primarily as a result of a significant increase in recognized impairment charges related to the Company’s investments in certain pooled trust preferred securities which have been adversely affected by the effects of the current economic downturn in the financial services industry, and decreases in investment advisory fees of its subsidiary A.R. Schmeidler & Co., Inc., a registered investment advisory firm located in Manhattan, New York. Fee income from this source experienced sharp declines beginning in the fourth quarter of 2008 and continued to decline during the first half of 2009 as a result of the effects of significant declines in both domestic and international equity markets. Although there has been recent improvement in the financial markets, continued improvement and the acquisition of new customers will be necessary for this source of noninterest income to return to past levels. At both December 31, 2009 and 2008, A.R. Schmeidler & Co., Inc. had approximately $1.3 billion of assets under management.
Nonperforming assets have increased dramatically in 2009, particularly in the second and fourth quarters, as overall asset quality continued to be adversely affected by the current state of the economy. During the year ended December 31, 2009, the Company has experienced significant increases in delinquent and nonperforming loans and a continuation of the slowdowns in repayments and declines in the loan-to-value ratios on existing loans which began in the second half of 2008. The severity of the economic downturn during 2009 has extended well beyond the sub-prime lending issue, and has resulted in severe declines in the demand for and values of virtually all commercial and residential real estate properties. These declines, together with the present shortage of available residential mortgage financing, have put downward pressure on the overall asset quality of virtually all financial institutions, including the Company. Continuation or worsening of such conditions would have additional significant adverse effects on asset quality in the future.
The 500 basis point reduction of short-term interest rates from September 2007 through December 2008 resulted in a steeper yield curve by late 2008 which continued throughout 2009. However, with interest rates at historical low levels, availability of long-term financing at attractive interest rates has been limited. This has resulted in many financial institutions replacing maturing long-term borrowings with short-term debt. While replacing long-term borrowings with lower cost short-term debt may have a positive impact on net interest income in the near term, this condition presents additional challenges in the ongoing management of interest rate risk to the extent that these borrowings are utilized to fund longer term assets at fixed rates. During 2009, the Company was able to repay maturing long-term borrowings, all of its brokered certificates of deposit and non-customer related short-term borrowings with liquidity provided primarily by core deposit growth and planned utilization of run-off from our investment securities.
As a result of the effects of changes in interest rates, activity in the Company’s core businesses of loans and deposits, an increase in loans as a percentage of total interest

 

 

earning assets and other asset/liability management activities, tax equivalent basis net interest income was unchanged at $30.0 million for the three month period ended December 31, 2009, compared to same period in the prior year, and increased by $3.7 million or 3.2 percent to $118.4 million for the year ended December 31, 2009, compared to $114.7 million for the same period in the prior year. The effect of the adjustment to a tax equivalent basis was $0.9 million and $4.1 million for the three month period and year ended December 31, 2009, respectively, compared to $1.1 million and $4.6 million for the same periods in the prior year.
Non interest income, excluding net gains and losses on securities transactions and recognized impairment charges on securities available for sale, was $4.0 million for the three month period ended December 31, 2009, a decrease of $0.7 million or 14.9 percent compared to $4.7 million for the same period in the prior year. Non interest income, excluding net gains and losses on securities transactions and recognized impairment charges on securities available for sale, was $15.9 million for the year ended December 31, 2009, a decrease of $4.1 million or 20.5 percent compared to $20.0 million for the prior year. The decreases were primarily due to a reduction in the investment advisory fees of A.R. Schmeidler & Co., Inc. Investment advisory fee income is expected to remain at reduced levels at least in the near term, due to the ongoing difficulties in the global financial markets. Non interest income also included recognized pre-tax impairment charges on securities available for sale of $1.3 million and $5.5 million, respectively, for the three month period and year ended December 31, 2009 and $1.6 million for the year ended December 31, 2008. The 2009 impairment charges were related to the Company’s investments in pooled trust preferred securities. The 2008 impairment charges, all of which occurred prior to the fourth quarter, included a $1.1 million charge related to a pooled trust preferred security and a $0.5 million charge related to the Company’s investment in a mutual fund which was sold in April 2008 without additional loss. The Company has decided to hold its investments in pooled trust preferred securities as it does not believe that the current market quotes for these investments are indicative of their underlying value. The pooled trust preferred securities are primarily backed by various U.S. financial institutions many of which are experiencing severe financial difficulties as a result of the current economic downturn. Continuation of these conditions may result in additional impairment charges on these securities in the future.
Non interest expense was $17.1 million for the three month period ended December 31, 2009, a decrease of $1.1 million or 6.0 percent compared to $18.2 million for the same period in the prior year. Non interest expense was $74.1 million for the year ended December 31, 2009, an increase of $3.0 million or 4.2 percent compared to $71.1 million for the prior year. Increases resulting from the Company’s continued investment in its branch offices, technology and personnel to accommodate growth in loans and deposits, the expansion of services and products available to new and existing customers and the upgrading of certain internal processes were effectively offset by significant other cost saving measures implemented by the Company during 2009. However, overall 2009 noninterest expense increased primarily due to a significant increase in FDIC deposit premiums. These additional premiums were imposed by the FDIC to replenish shortfalls in the FDIC Insurance Fund which has resulted from the current economic crisis.

 

 

Additional premium increases and special assessments may continue to be imposed by the FDIC in the future to address potential shortfalls in the overall deposit insurance reserve funds.
In today’s economic and regulatory environment the Office of the Comptroller of the Currency (OCC), which is the primary federal regulator of the Banks, has directed greater scrutiny to banks with higher levels of commercial real estate loans. During the fourth quarter of 2009, the OCC required HVB to maintain, by December 31, 2009, a total risk-based capital ratio of at least 12.0%, a Tier 1 risk-based capital ratio of at least 10.0%, and a Tier 1 leverage ratio of at least 8.0%. These capital levels are in excess of “well capitalized” levels generally applicable to banks under current regulations.
To meet these increased capital ratios and to support future growth, the Company successfully raised a net $93.3 million in an underwritten common stock offering in the fourth quarter of 2009. The Company contributed $44.0 million of this amount to its subsidiary banks, $42.5 million to Hudson Valley Bank and $1.5 million to New York National Bank. As a result of these actions, as of December 31, 2009, the Company, Hudson Valley Bank and New York National Bank exceeded all required regulatory capital levels.
As previously announced we will be holding a yearend earnings conference call Tuesday, February 2, 2010 at 9:30 AM EST — Conference ID 1913097: Domestic (toll free): 1-866-450-8367 or International (toll) +1-412-317-5427.
A replay of the call will be available 1 hour from the close of the conference through February 17, 2010 at 9:00 AM EST Conference Number: 437047: US Toll Free: 1-877-344-7529; International Toll: 1-412-317-0088. Participants will be required to state their name and company upon entering call.
##
About Hudson Valley Holding Corp.
Hudson Valley Holding Corp. (HUVL), headquartered in Yonkers, NY, is the parent company of two independently owned local banks, Hudson Valley Bank (HVB) and New York National Bank (NYNB). Hudson Valley Bank is a Westchester based bank with more than $2.5 billion in assets, serving the metropolitan area with 33 branches located in Westchester, Rockland, the Bronx, Manhattan, Queens and Brooklyn in New York and Fairfield County and New Haven County, CT. HVB specializes in providing a full range of financial services to businesses, professional services firms, not-for-profit organizations and individuals; and provides investment management services through a subsidiary, A. R. Schmeidler & Co., Inc. NYNB is a Bronx based bank with approximately $140 million in assets serving the local communities of the Bronx and Upper Manhattan with three branches. NYNB provides a full range of financial services to individuals, small businesses and not-for-profit organizations in its local markets. Hudson Valley Holding Corp.’s common stock is traded on NASDAQ Global Select Market under the ticker symbol “HUVL”. Additional information on Hudson Valley Bank and NYNB Bank can be obtained on their respective web-sites at www.hudsonvalleybank.com and www.nynb.com.
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This press release may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are statements that are not historical facts. These statements relate to future events or our future financial performance. We have attempted to identify forward-looking statements by terminology including “anticipates,” “believes,” “can,” “continue,” “expects,” “intends,” “may,” “plans,” “potential,” “predicts,” “should” or “will” or the negative of these terms or other comparable terminology. These statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, level of activity, performance or achievements to be materially different from our future results, level of activity, performance or achievements expressed or implied by these forward-looking statements. Factors that may cause actual results to differ materially from those contemplated by such forward-looking statements include, but are not limited to:
  •   a continued or unexpected decline in the economy in the New York Metropolitan area;
 
  •   increases in loan losses or in the level of nonperforming loans;
 
  •   unexpected increases in our allowance for loan losses;
 
  •   our failure to maintain required regulatory capital levels;
 
  •   further declines in value in our investment portfolio;
 
  •   a continued or unexpected decline in real estate values within our market areas;
 
  •   higher than expected FDIC insurance premiums;
 
  •   unexpected changes in interest rates;
 
  •   additional regulatory oversight which may require us to change our business model;
 
  •   the imposition on us of liabilities under federal or state environmental laws;
 
  •   those risk factors identified in our SEC filings, including our Form 10-Q for the quarter ended September 30, 2009.
Forward looking statements speak only as of the date such statements are made. The Company undertakes no duty to update any forward-looking statement to conform the statement to actual results or changes in the Company’s expectations.

 

 

HUDSON VALLEY HOLDING CORP. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
For the three months ended December 31, 2009 and 2008
Dollars in thousands, except per share amounts
                 
    Three Months Ended  
    December 31,  
    2009     2008  
Interest Income:
                
Loans, including fees
   $ 28,449     $ 27,608  
Securities:
                
Taxable
     3,944       5,868  
Exempt from Federal income taxes
     1,714       2,116  
Federal funds sold
     38       7  
Deposits in banks
     49       71  
 
            
Total interest income
     34,194       35,670  
 
            
Interest Expense:
                
Deposits
     3,499       4,169  
Securities sold under repurchase agreements and other short-term borrowings
     62       496  
Other borrowings
     1,568       2,165  
 
            
Total interest expense
     5,129       6,830  
 
            
Net Interest Income
     29,065       28,840  
Provision for loan losses
     7,082       7,540  
 
            
Net interest income after provision for loan losses
     21,983       21,300  
 
            
Non Interest Income:
                
Service charges
     1,541       1,695  
Investment advisory fees
     2,140       2,315  
Recognized impairment charge on securities available for sale (includes $1,776 of total losses less $429 of losses on securities available for sale, recognized in other comprehensive income at December 31, 2009)
     (1,347 )     —  
Other income
     332       694  
 
            
Total non interest income
     2,666       4,704  
 
            
Non Interest Expense:
                
Salaries and employee benefits
     8,919       10,945  
Occupancy
     2,124       1,997  
Professional services
     1,167       815  
Equipment
     1,081       1,090  
Business development
     497       427  
FDIC assessment
     937       332  
Other operating expenses
     2,397       2,621  
 
            
Total non interest expense
     17,122       18,227  
 
            
Income Before Income Taxes
     7,527       7,777  
Income Taxes
     2,315       2,292  
 
            
Net Income
   $ 5,212     $ 5,485  
 
            
Basic Earnings Per Common Share (1)
   $ 0.35     $ 0.46  
Diluted Earnings Per Common Share (1)
     0.34       0.45  
 
(1)   2008 per share amounts have been restated to reflect the effects of the 10% stock dividend issued in December 2009.

 

 

HUDSON VALLEY HOLDING CORP. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
For the years ended December 31, 2009 and 2008
Dollars in thousands, except per share amounts
                 
    Year Ended  
    December 31,  
    2009     2008  
Interest Income:
                
Loans, including fees
   $ 110,662     $ 105,632  
Securities:
                
Taxable
     18,077       24,873  
Exempt from Federal income taxes
     7,659       8,628  
Federal funds sold
     100       827  
Deposits in banks
     81       152  
 
            
Total interest income
     136,579       140,112  
 
            
Interest Expense:
                
Deposits
     14,595       19,035  
Securities sold under repurchase agreements and other short-term borrowings
     536       2,187  
Other borrowings
     7,173       8,861  
 
            
Total interest expense
     22,304       30,083  
 
            
Net Interest Income
     114,275       110,029  
Provision for loan losses
     24,306       11,025  
 
            
Net interest income after provision for loan losses
     89,969       99,004  
 
            
Non Interest Income:
                
Service charges
     5,914       5,951  
Investment advisory fees
     7,716       11,181  
Recognized impairment charge on securities available for sale (includes $6,684 of total losses less $1,188 of losses on securities available for sale, recognized in other comprehensive income at December 31, 2009)
     (5,496 )     (1,547 )
Realized gain on securities available for sale, net
     52       148  
Other income
     2,308       2,871  
 
            
Total non interest income
     10,494       18,604  
 
            
Non Interest Expense:
                
Salaries and employee benefits
     38,688       41,857  
Occupancy
     8,272       7,490  
Professional services
     4,447       4,295  
Equipment
     4,354       4,219  
Business development
     2,032       2,053  
FDIC assessment
     5,491       893  
Other operating expenses
     10,857       10,278  
 
            
Total non interest expense
     74,141       71,085  
 
            
Income Before Income Taxes
     26,322       46,523  
Income Taxes
     7,310       15,646  
 
            
Net Income
   $ 19,012     $ 30,877  
 
            
Basic Earnings Per Common Share (1)
   $ 1.53     $ 2.58  
Diluted Earnings Per Common Share (1)
     1.50       2.50  
 
(1)   2008 per share amounts have been restated to reflect the effects of the 10% stock dividend issued in December 2009.

 

 

HUDSON VALLEY HOLDING CORP. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS (UNAUDITED)
December 31, 2009 and 2008
In thousands, except per share and share amounts
                 
    December 31,     December 31,  
    2009     2008  
ASSETS
                
Cash and due from banks
   $ 166,980     $ 45,428  
Federal funds sold
     51,891       6,679  
Securities available for sale at estimated fair value (amortized cost of $500,340 in 2009 and $647,279 in 2008)
     500,635       642,363  
Securities held to maturity at amortized cost (estimated fair value of $22,728 in 2009 and $29,546 in 2008)
     21,650       28,992  
Federal Home Loan Bank of New York (FHLB) Stock
     8,470       20,493  
Loans (net of allowance for loan losses of $38,645 in 2009 and $22,537 in 2008)
     1,772,645       1,677,611  
Accrued interest and other receivables
     15,200       16,357  
Premises and equipment, net
     30,383       30,987  
Other real estate owned
     9,211       5,467  
Deferred income taxes, net
     20,957       14,030  
Bank owned life insurance
     24,458       22,853  
Goodwill
     23,842       20,942  
Other intangible assets
     3,276       4,097  
Other assets
     15,958       4,591  
 
            
TOTAL ASSETS
   $ 2,665,556     $ 2,540,890  
 
            
 
                
LIABILITIES
                
Deposits:
                
Non interest-bearing
   $ 686,856     $ 647,828  
Interest-bearing
     1,485,759       1,191,498  
 
            
Total deposits
     2,172,615       1,839,326  
Securities sold under repurchase agreements and other short-term borrowings
     53,121       269,585  
Other borrowings
     123,782       196,813  
Accrued interest and other liabilities
     22,360       27,665  
 
            
TOTAL LIABILITIES
     2,371,878       2,333,389  
 
            
 
                
STOCKHOLDERS’ EQUITY
                
Common stock, $0.20 par value; authorized 25,000,000 shares; outstanding 16,016,738 and 10,556,554 shares in 2009 and 2008, respectively
     3,463       2,367  
Additional paid-in capital
     346,297       250,129  
Retained earnings
     2,294       2,084  
Accumulated other comprehensive income (loss), net
     (812 )     (5,144 )
Treasury stock, at cost; 1,299,414 and 964,763 shares in 2009 and 2008, respectively
     (57,564 )     (41,935 )
 
            
Total stockholders’ equity
     293,678       207,501  
 
            
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY
   $ 2,665,556     $ 2,540,890  
 
            

 

 

Average Balances and Interest Rates
     The following table sets forth the average balances of interest earning assets and interest bearing liabilities for the three month periods ended December 31, 2009 and 2008, as well as total interest and corresponding yields and rates.
                                                 
    (Dollars in thousands)  
    Three Months Ended December 31,  
    2009     2008  
    Average             Yield/     Average             Yield/  
(Unaudited)   Balance     Interest(3)     Rate     Balance     Interest(3)     Rate  
 
                                                
ASSETS
                                                
Interest earning assets:
                                                
Deposits in Banks
   $ 91,304     $ 49       0.21 %   $ 6,063     $ 71       4.68 %
Federal funds sold
     73,728       38       0.21 %     5,609       7       0.50 %
Securities:(1)
                                                
Taxable
     371,241       3,944       4.25 %     491,752       5,868       4.77 %
Exempt from federal income taxes
     167,907       2,637       6.28 %     205,415       3,256       6.34 %
Loans, net(2)
     1,782,007       28,449       6.39 %     1,640,207       27,608       6.73 %
 
                                        
Total interest earning assets
     2,486,187       35,117       5.65 %     2,349,046       36,810       6.27 %
 
                                        
Non interest earning assets:
                                                
Cash & due from banks
     43,355                       49,571                  
Other assets
     120,187                       114,542                  
 
                                            
Total non interest earning assets
     163,542                       164,113                  
 
                                            
Total assets
   $ 2,649,729                     $ 2,513,159                  
 
                                            
LIABILITIES AND STOCKHOLDERS’ EQUITY
                                                
Interest bearing liabilities:
                                                
Deposits:
                                                
Money market
   $ 864,688     $ 2,314       1.07 %   $ 634,693     $ 2,272       1.43 %
Savings
     108,782       142       0.52 %     98,755       163       0.66 %
Time
     222,687       763       1.37 %     293,707       1,567       2.13 %
Checking with interest
     279,797       280       0.40 %     139,851       167       0.48 %
Securities sold under repo & other s/t borrowings
     53,085       62       0.47 %     240,928       496       0.82 %
Other borrowings
     122,067       1,568       5.14 %     196,819       2,165       4.40 %
 
                                        
Total interest bearing liabilities
     1,651,106       5,129       1.24 %     1,604,753       6,830       1.70 %
 
                                        
Non interest bearing liabilities:
                                                
Demand deposits
     708,710                       656,641                  
Other liabilities
     25,238                       37,006                  
 
                                            
Total non interest bearing liabilities
     733,948                       693,647                  
 
                                            
Stockholders’ equity(1)
     264,675                       214,759                  
 
                                            
Total liabilities and stockholders’ equity
   $ 2,649,729                     $ 2,513,159                  
 
                                            
Net interest earnings
           $ 29,988                     $ 29,980          
 
                                            
Net yield on interest earning assets
                     4.82 %                     5.11 %
 
(1)   Excludes unrealized gains (losses) on securities available for sale.
 
(2)   Includes loans classified as non-accrual.
 
(3)   The data contained in the table has been adjusted to a tax equivalent basis, based on the Company’s federal statutory rate of 35 percent. Effects of adjustments to a tax equivalent basis were increases of $923 and $1,140 for the three month periods ended December 31, 2009 and December 31, 2008, respectively.

 

 

     The following table sets forth the average balances of interest earning assets and interest bearing liabilities for the years ended December 31, 2009 and 2008, as well as total interest and corresponding yields and rates.
                                                 
    (Dollars in thousands)  
    Year Ended December 31,  
    2009     2008  
    Average             Yield/     Average             Yield/  
(Unaudited)   Balance     Interest(3)     Rate     Balance     Interest(3)     Rate  
 
                                                
ASSETS
                                                
Interest earning assets:
                                                
Deposits in Banks
   $ 35,508     $ 81       0.23 %   $ 5,362     $ 152       2.83 %
Federal funds sold
     43,910       100       0.23 %     24,899       827       3.32 %
Securities:(1)
                                                
Taxable
     413,781       18,077       4.37 %     507,943       24,873       4.90 %
Exempt from federal income taxes
     184,772       11,783       6.38 %     208,730       13,274       6.36 %
Loans, net(2)
     1,739,421       110,662       6.35 %     1,483,196       105,632       7.12 %
 
                                        
Total interest earning assets
     2,417,392       140,703       5.82 %     2,230,130       144,758       6.49 %
 
                                        
Non interest earning assets:
                                                
Cash & due from banks
     43,197                       49,786                  
Other assets
     118,118                       105,478                  
 
                                            
Total non interest earning assets
     161,315                       155,264                  
 
                                            
Total assets
   $ 2,578,707                     $ 2,385,394                  
 
                                            
LIABILITIES AND STOCKHOLDERS’ EQUITY
                                                
Interest bearing liabilities:
                                                
Deposits:
                                                
Money market
   $ 787,347     $ 9,145       1.16 %   $ 642,784     $ 10,498       1.63 %
Savings
     101,846       503       0.49 %     95,296       708       0.74 %
Time
     263,065       3,899       1.48 %     263,506       6,757       2.56 %
Checking with interest
     250,314       1,048       0.42 %     149,793       1,072       0.72 %
Securities sold under repo & other s/t borrowings
     101,818       536       0.53 %     161,749       2,187       1.35 %
Other borrowings
     153,799       7,173       4.66 %     201,687       8,861       4.39 %
 
                                        
Total interest bearing liabilities
     1,658,189       22,304       1.35 %     1,514,815       30,083       1.99 %
 
                                        
Non interest bearing liabilities:
                                                
Demand deposits
     675,953                       625,630                  
Other liabilities
     28,049                       32,797                  
 
                                            
Total non interest bearing liabilities
     704,002                       658,427                  
 
                                            
Stockholders’ equity(1)
     216,516                       212,152                  
 
                                            
Total liabilities and stockholders’ equity
   $ 2,578,707                     $ 2,385,394                  
 
                                            
Net interest earnings
           $ 118,399                     $ 114,675          
 
                                            
Net yield on interest earning assets
                     4.90 %                     5.14 %
 
(1)   Excludes unrealized gains (losses) on securities available for sale.
 
(2)   Includes loans classified as non-accrual.
 
(3)   The data contained in the table has been adjusted to a tax equivalent basis, based on the Company’s federal statutory rate of 35 percent. Effects of adjustments to a tax equivalent basis were increases of $4,124 and $4,646 for the years ended December 31, 2009 and December 30, 2008, respectively.

 

 

HUDSON VALLEY HOLDING CORP. AND SUBSIDIARIES
Average Balances and Interest Rates
Non-GAAP disclosures
                                 
    Three months ended   Year ended
    December 31   December 31
    2009   2008   2009   2008
     
 
                                
Total interest earning assets:
                                
As reported
   $ 2,489,933     $ 2,335,381     $ 2,418,855     $ 2,225,320  
Unrealized gain (loss) on securities available-for-sale (1)
     3,746       (13,665 )     1,463       (4,810 )
     
 
                                
Adjusted total interest earning assets
   $ 2,486,187     $ 2,349,046     $ 2,417,392     $ 2,230,130  
     
 
                                
Net interest earnings:
                                
As reported
   $ 29,065     $ 28,840     $ 114,275     $ 110,029  
Adjustment to tax equivalency basis (2)
     923       1,140       4,124       4,646  
     
 
                                
Adjusted net interest earnings
   $ 29,988     $ 29,980     $ 118,399     $ 114,675  
     
 
                                
Net yield on interest earning assets:
                                
As reported
     4.67 %     4.94 %     4.72 %     4.94 %
Effects of (1) and (2) above
     0.16 %     0.17 %     0.17 %     0.20 %
     
 
                                
Adjusted net interest earnings
     4.82 %     5.11 %     4.90 %     5.14 %
     

 

 

HUDSON VALLEY HOLDING CORP. AND SUBSIDIARIES
Financial Highlights (Unaudited)
Fourth Quarter 2009
(Dollars in thousands, except per share amounts)
                                 
    Year end   Year end   3 mos end   3 mos end
    Dec 31   Dec 31   Dec 31   Dec 31
    2009   2008   2009   2008
 
 
                                
Earnings:
                                
Net Interest Income
   $ 114,275     $ 110,029     $ 29,065     $ 28,840  
Non Interest Income
   $ 10,494     $ 18,604     $ 2,666     $ 4,704  
Non Interest Expense
   $ 74,141     $ 71,085     $ 17,122     $ 18,227  
Net Income
   $ 19,012     $ 30,877     $ 5,212     $ 5,485  
Net Interest Margin
     4.73 %     4.93 %     4.68 %     4.91 %
Net Interest Margin (FTE)
     4.90 %     5.14 %     4.82 %     5.11 %
 
                                
Diluted Earnings Per Share (1)
   $ 1.50     $ 2.50     $ 0.34     $ 0.45  
Dividends Per Share (1)
   $ 1.26     $ 1.65     $ 0.21     $ 0.42  
Return on Average Equity
     8.7 %     14.8 %     7.8 %     10.6 %
Return on Average Assets
     0.7 %     1.3 %     0.8 %     0.9 %
 
                                
Average Balances:
                                
Average Assets
   $ 2,580,170     $ 2,380,584     $ 2,653,475     $ 2,499,494  
Average Net Loans
   $ 1,739,421     $ 1,483,196     $ 1,782,007     $ 1,640,207  
Average Investments
   $ 598,553     $ 716,673     $ 539,148     $ 697,167  
Average Interest Earning Assets
   $ 2,418,855     $ 2,225,320     $ 2,489,933     $ 2,335,381  
Average Deposits
   $ 2,078,525     $ 1,777,009     $ 2,184,664     $ 1,823,647  
Average Borrowings
   $ 255,617     $ 363,436     $ 175,152     $ 437,747  
Average Interest Bearing Liabilities
   $ 1,658,189     $ 1,514,815     $ 1,651,106     $ 1,604,753  
Average Stockholders’ Equity
   $ 217,505     $ 209,197     $ 267,054     $ 206,518  
 
                                
Asset Quality — During Period:
                                
Provision for loan losses
   $ 24,306     $ 11,025     $ 7,082     $ 7,540  
Net Charge offs
   $ 8,199     $ 5,855     $ 3,283     $ 2,255  
Annualized Net Charge offs / Average Net Loans
     0.47 %     0.39 %     0.74 %     0.55 %
 
(1)   2008 per share amounts have been restated to reflect the effects of the 10% stock dividend issued in December 2009.

 

 

HUDSON VALLEY HOLDING CORP. AND SUBSIDIARIES
Selected Financial Data (Unaudited)
Fourth Quarter 2009
(Dollars in thousands except per share amounts)
                                         
    Dec 31   Sep 30   Jun 30   Mar 31   Dec 31
Selected Balance Sheet Data   2009   2009   2009   2009   2008
 
 
                                        
Period End Balances:
                                        
Total Assets
   $ 2,665,556     $ 2,578,790     $ 2,562,048     $ 2,546,200     $ 2,540,890  
Total Investments
   $ 522,285     $ 548,123     $ 520,102     $ 629,153     $ 671,355  
Net Loans
   $ 1,772,645     $ 1,750,917     $ 1,746,190     $ 1,715,856     $ 1,677,611  
Goodwill and Other Intangible Assets
   $ 27,118     $ 24,414     $ 24,620     $ 24,825     $ 25,039  
Total Deposits
   $ 2,172,615     $ 2,169,811     $ 2,135,247     $ 2,059,615     $ 1,839,326  
Total Stockholders’ Equity
   $ 293,678     $ 200,718     $ 194,751     $ 199,374     $ 207,501  
Common Shares Outstanding (1)
     16,016,738       11,612,209       11,628,628       11,660,276       11,958,770  
Book Value Per Share (1)
   $ 18.34     $ 17.29     $ 16.75     $ 17.10     $ 17.35  
 
                                        
Tier 1 Leverage Ratio
     10.2 %     6.9 %     6.8 %     6.9 %     7.5 %
Tier 1 Risk Based Capital Ratio
     13.9 %     9.2 %     9.0 %     9.3 %     10.1 %
Total Risk Based Capital Ratio
     15.2 %     10.5 %     10.2 %     10.6 %     11.3 %
 
                                        
Loan Categories:
                                        
Commercial Real Estate
   $ 783,597     $ 745,406     $ 731,927     $ 676,263     $ 642,923  
Construction
     255,660       261,827       274,039       266,983       254,837  
Residential
     454,532       454,326       453,182       434,516       409,431  
Commercial and Industrial
     274,860       282,513       279,400       328,462       358,076  
Individuals
     26,970       26,824       25,887       18,775       21,536  
Lease Financing
     20,810       19,800       20,660       19,963       18,461  
 
Total Loans
   $ 1,816,429     $ 1,790,696     $ 1,785,095     $ 1,744,962     $ 1,705,264  
 
 
                                        
Asset Quality — Period End:
                                        
Allowance for Loan Losses
   $ 38,645     $ 34,845     $ 34,177     $ 24,199     $ 22,537  
Nonaccrual Loans
   $ 50,590     $ 39,872     $ 41,308     $ 27,859     $ 11,284  
Loans 90 Days or More Past Due Accruing
   $ 6,941     $ 20,878     $ 11,039     $ 5,885     $ 7,019  
Other Real Estate Owned
   $ 9,211     $ 5,063     $ 7,188     $ 5,455     $ 5,467  
Allowance / Total Loans
     2.13 %     1.95 %     1.91 %     1.39 %     1.32 %
Nonaccrual / Total Loans
     2.79 %     2.23 %     2.31 %     1.60 %     0.66 %
Nonaccrual + 90 Day Past Due / Total Loans
     3.17 %     3.39 %     2.93 %     1.93 %     1.07 %
Nonaccrual + OREO / Total Assets
     2.24 %     1.74 %     1.89 %     1.31 %     0.66 %
                                         
    3 mos end   3 mos end   3 mos end   3 mos end   3 mos end
    Dec 31   Sep 30   Jun 30   Mar 31   Dec 31
Selected Income Statement Data   2009   2009   2009   2009   2008
 
 
                                        
Interest Income
   $ 34,194     $ 33,839     $ 33,910     $ 34,636     $ 35,670  
Interest Expense
     5,129       5,193       5,731       6,251       6,830  
 
Net Interest Income
     29,065       28,646       28,179       28,385       28,840  
Provision for Loan Losses
     7,082       2,732       11,527       2,965       7,540  
Non Interest Income
     2,666       3,341       1,837       2,650       4,704  
Non Interest Expense
     17,122       18,931       19,639       18,449       18,227  
 
Income Before Income Taxes
     7,527       10,324       (1,150 )     9,621       7,777  
Income Taxes
     2,315       3,426       (1,460 )     3,029       2,292  
 
Net Income
   $ 5,212     $ 6,898     $ 310     $ 6,592     $ 5,485  
 
Diluted Earnings Per Share (1)
   $ 0.34     $ 0.58     $ 0.03     $ 0.55     $ 0.45  
 
(1)   Share and per share amounts for September 2009, June 2009, March 2009 and December 2008 have been restated to reflect the effects of the 10% stock dividend issued in December 2009.