-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, KJcI1qZyPyz0nlVQumtCdbPxn4K8f1fbLYy4d8DfJ/p9AZH+tNwXXUKz4kH6TmXo DbAPPDKk0kXB3YTpEHfEaQ== 0000755933-05-000018.txt : 20050429 0000755933-05-000018.hdr.sgml : 20050429 20050429164126 ACCESSION NUMBER: 0000755933-05-000018 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20050426 ITEM INFORMATION: Other Events ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20050429 DATE AS OF CHANGE: 20050429 FILER: COMPANY DATA: COMPANY CONFORMED NAME: INTERCHANGE FINANCIAL SERVICES CORP /NJ/ CENTRAL INDEX KEY: 0000755933 STANDARD INDUSTRIAL CLASSIFICATION: NATIONAL COMMERCIAL BANKS [6021] IRS NUMBER: 222553159 STATE OF INCORPORATION: NJ FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-10518 FILM NUMBER: 05786620 BUSINESS ADDRESS: STREET 1: PARK 80 WEST PLAZA TWO STREET 2: ATTN INTERCHANGE STATE BANK CITY: SADDLE BROOK STATE: NJ ZIP: 07662 BUSINESS PHONE: 2017032265 MAIL ADDRESS: STREET 1: PARK 80 WEST STREET 2: PLAZA II CITY: SADDLE BROOK STATE: NJ ZIP: 07663 FORMER COMPANY: FORMER CONFORMED NAME: INTERCHANGER STATE BANK DATE OF NAME CHANGE: 19870416 FORMER COMPANY: FORMER CONFORMED NAME: INTERCHANGE FINANCIAL SERVICES CORP DATE OF NAME CHANGE: 19861209 8-K 1 earnings1-05.txt 1ST QTR 2005 EARNINGS PRESS RELEASE UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ___________ FORM 8-K ___________ CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 DATE OF REPORT (date of earliest event reported): April 29, 2005 INTERCHANGE FINANCIAL SERVICES CORPORATION (Exact name of registrant as specified in its charter) New Jersey 1-10518 22-2553159 _______________________________ _______________________ _________________ (State or other jurisdiction of (Commission File Number) (I.R.S. Employer incorporation or organization) Identification No.) Park 80 West/Plaza Two, Saddle Brook, N.J. 07663 __________________________________________ ___________ (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (201) 703-2265 Not Applicable ______________________________________________________________________________ (Former name or former address, if changed since last report.) Item 5. Other Events On April 28, 2005, Interchange Financial Services Corporation issued a press release reporting earnings for the first quarter period ending March 31, 2005. A copy of that release is furnished as Exhibit 99.1 to this Report. Item 7. Financial Statement Exhibits (c) Exhibits. 99.1 Press Release dated April 28, 2005 of the Registrant. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. Dated: April 29, 2005 Interchange Financial Services Corporation By: /s/ Charles T. Field _________________________ Name: Charles T. Field Title: SVP & Chief Financial Officer EXHIBIT INDEX EXHIBIT NUMBER DESCRIPTION 99.1 Press Release, dated April 28, 2005, of the Registrant EX-99.1 2 pressrelease.txt PRESS RELEASE Business Wire April 27, 2005 04:08 PM US Eastern Timezone Interchange Reports 1st Quarter Double Digit Growth SADDLE BROOK, N.J.--(BUSINESS WIRE)--April 27, 2005--Interchange Financial Services Corporation (NASDAQ: IFCJ) 1st Quarter Highlights: - -- Diluted earnings per share increase 15% - -- Net income grows 11% - -- Commercial loans grew $41 million sequentially at an annualized rate of 26% Interchange Financial Services Corporation (the "Company") (NASDAQ: IFCJ), holding company of Bergen County's fast growing community bank, Interchange Bank (the "Bank"), today reported first quarter net income of approximately $4.4 million, up 10.9% from the same period in 2004. Diluted earnings per share ("EPS") for the three months were $0.23 versus $0.20, an increase of 15.0%, as compared to the same period in 2004. Anthony Abbate, president and chief executive officer, stated, "Our diluted earnings per share advanced 15.0%. Excluding gains on sales of securities, it increased by 20% year over year as a result of our commitment to the strategic business plan that maximizes shareholder value. The execution of the business plan is the major task for all employees of the Company. They continue to execute the plan at a very high level and the results speak for themselves. Here are just a few highlights: - -- Commercial loans grew $41 million or over 26%, on an annualized basis; - -- The net interest margin advanced to 4.14%; and - -- Our return on average tangible equity was over 19%. Our long-term vision and commitment produce consistent long-term value for our shareholders, which is evidenced by a total return of 616% on Interchange's stock over the past ten years through March 31, 2005 as provided by Bloomberg L.P." Commenting further on the Company's performance, Mr. Abbate stated, "Our exceptional commercial loan growth throughout 2004 and into 2005 along with our expanded SBA loan department allows us to build on first quarter momentum throughout the remainder of the year." The Company declared a quarterly cash dividend of $0.09 per common share, for the second quarter of 2005. This dividend represents $0.36 per share on an annualized basis; an increase of 8.0% over the prior year. Return on Average Assets and Equity The Company's return on average assets increased to 1.20% as compared to 1.16% for the three months ended March 31, 2005 and 2004, respectively. In addition, the Company's return on average stockholders' equity and return on tangible equity increased to 11.70% and 19.32% for the first quarter 2005 versus 11.13% and 18.89% respectively, for the first quarter in 2004. Net Interest Income For the first quarter of 2005, net interest income, on a taxable equivalent basis, increased $1.0 million, or 8.1%, from the same period in 2004. The growth for the quarter as compared to 2004 was attributed to an increase in average interest earning assets of $92.4 million which was largely due to a 17.4% growth in average loans. Complementing the growth in loans was an increase in net interest margin to 4.14% for the first quarter of 2005 from 4.11% for the same period in 2004. Non-Interest Income For the three months ending March 31, 2005, non-interest income, excluding gains on sales of securities, increased 6.3% to $2.1 million. Net gains on sales of loans were primarily associated with our SBA lending operations which accounted for $124 thousand of the total sales for the quarter. We currently have a healthy pipeline of SBA loans. Non-Interest Expense Non-interest expense for the quarter amounted to $9.2 million, an increase of $237 thousand or 2.7% as compared to same quarter in 2004. The increase for the period was due largely to additional salary and benefit expense and occupancy costs. The increase in salary and benefit expense was as a result of the personnel expense associated with the expansion of our commercial lending unit and commercial credit department along with normal increases related to salaries and benefits. Total Loans At March 31, 2005, total gross loans were approximately $977.1 million, an increase of $42.9 million, or 18.4% annualized, as compared to December 31, 2004. Our commercial loan portfolio increased $40.6 million, or 26.5% on an annualized basis. We saw growth in each segment of our commercial loan portfolio as commercial mortgages, construction and commercial and financial loans expanded $18.8 million, $10.7 million and $11.1 million, respectively. Non-performing assets decreased 14.7% to $7.9 million at March 31, 2005 as compared to $9.3 million at December 31, 2004. Non-performing assets represented 0.81% versus 0.99%, of the total loans and foreclosed and repossessed assets outstanding at the end of the respective periods. The Allowance for Loan and Lease Losses totaled $9.9 million at March 31, 2005, and represented 127.0% of non-performing loans and leases and 1.01% of total loans and leases. Post-Earnings Conference Call The Bank will hold a conference call on Thursday, April 28, 2005, at 10 a.m. (Eastern Time) to discuss the financial results for its first fiscal quarter ending March 31, 2005. This Web-cast can be accessed through the Bank's Web site,or on the investor relations page, as well as the Web address www.companyboardroom.com. The replay will begin shortly after the completion of the live call and will be available for approximately two weeks. About Interchange Financial Services Corporation Headquartered in Saddle Brook, NJ, Interchange Financial Services Corporation (NASDAQ: IFCJ) wholly-owns Interchange Bank, one of Bergen County's largest independent commercial banks. A thought leader in the industry, the Bank was among the first to implement a broad range of innovative services, including 24-hour, 7-day-a-week online banking and bill paying services, online stock trading, and the ability to apply for a loan online with an instant credit decision. Mutual funds and annuities are offered through the Bank's investment services. With $1.5 billion in assets and 29 branches, the Bank focuses its efforts on the local communities from which it derives deposits and generates loans. Through Interchange Bank's subsidiary, Interchange Capital Company, L.L.C., cost effective equipment leasing solutions are available to small- and middle-market companies. For additional information, please visit the company's Web site at www.interchangebank.com. In addition to discussing historical information, certain statements included in or incorporated into this report relate to the financial condition, results of operations and business of the Company which are not historical facts, but which are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. When used herein, the words "anticipate," "believe," "estimate," "expect," "will" and other similar expressions are generally intended to identify such forward-looking statements. Such statements are intended to be covered by the safe harbor provisions for forward-looking statements contained in such Act, and we are including this statement for purposes of invoking these safe harbor provisions. These forward-looking statements include, but are not limited to, statements about the operations of the Company, the adequacy of the Company's allowance for losses associated with the loan portfolio, the prospects of continued loan and deposit growth, and improved credit quality. The forward-looking statements in this report involve certain estimates or assumptions, known and unknown risks and uncertainties, many of which are beyond the control of the Company, and reflect what we currently anticipate will happen in each case. What actually happens could differ materially from what we currently anticipate will happen due to a variety of factors, including, among others risks detailed in reports filed by the Company with the Securities and Exchange Commission. Readers should not place undue expectations on any forward-looking statements. We are not promising to make any public announcement when we consider forward-looking statements in this document to be no longer accurate, whether as a result of new information, what actually happens in the future or for any other reason. INTERCHANGE FINANCIAL SERVICES CORPORATION CONSOLIDATED FINANCIAL HIGHLIGHTS CONSOLIDATED BALANCE SHEETS (dollars in thousands) March 31, December 31, 2005 2004 Change ----------- ----------- ------- (unaudited) (unaudited) Assets Cash and due from banks $31,762 $33,108 (4.1)% Interest earning deposits 2 2 - Securities 371,439 388,729 (4.4) Loans and leases Commercial 654,141 613,533 6.6 Commercial Lease Financing 23,871 23,535 1.4 Consumer 299,077 297,113 0.7 ----------- ----------- ------- 977,089 934,181 4.6 Allowance for loan and lease losses -9,876 -9,797 0.8 ----------- ----------- ------- Net loans 967,213 924,384 4.6 Premises and equipment, net 17,579 17,713 (0.8) Foreclosed real estate and other repossesed assets 150 156 (3.8) Bank Owned Life Insurance 26,110 25,847 1.0 Goodwill and other intangible assets 59,486 59,612 (0.2) Accrued interest receivable and other assets 15,108 14,590 3.6 ----------- ----------- ------- Total assets $1,488,849 $1,464,141 1.7 =========== =========== ======= Liabilities Deposits $1,231,396 $1,246,138 (1.2) Borrowings 95,586 59,001 62.0 Accrued interest payable and other liabilities 10,660 8,847 20.5 ----------- ----------- ------- Total liabilities 1,337,642 1,313,986 1.8 ----------- ----------- ------- Total stockholders' equity 151,207 150,155 0.7 ----------- ----------- ------- Total liabilities and stockholders' equity $1,488,849 $1,464,141 1.7 =========== =========== ======= CONSOLIDATED INCOME STATEMENTS (dollars in thousands) Three Months Ended March 31, ------------------------------- 2005 2004 Change ----------- ----------- ------- (unaudited) (unaudited) Interest income: Interest and fees on loans $14,957 $12,707 17.7 % Interest on federal funds sold - 6 (100.0) Interest and dividends on securities: Taxable interest income 2,665 2,650 0.6 Interest income exempt from federal income taxes 323 269 20.1 Dividends 60 39 53.8 ----------- ----------- ------- Total interest income 18,005 15,671 14.9 ----------- ----------- ------- Interest expense: Interest on deposits 3,922 2,827 38.7 Interest on borrowings 519 310 67.4 ----------- ----------- ------- Total interest expense 4,441 3,137 41.6 ----------- ----------- ------- Net interest income 13,564 12,534 8.2 Provision for loan and lease losses 175 375 (53.3) ----------- ----------- ------- Net interest income after provision for loan & lease losses 13,389 12,159 10.1 ----------- ----------- ------- Non-interest income: Service fees on deposit accounts 883 842 4.9 Net gain on sale of securities 67 514 (87.0) Other 1,244 1,159 7.3 ----------- ----------- ------- Total non-interest income 2,194 2,515 (12.8) ----------- ----------- ------- Non-interest expense: Salaries and benefits 4,955 4,848 2.2 Net occupancy 1,463 1,365 7.2 Furniture and equipment 315 334 (5.7) Advertising and promotion 395 393 0.5 Other 2,026 1,977 2.5 ----------- ----------- ------- Total non-interest expense 9,154 8,917 2.7 ----------- ----------- ------- Income before income taxes 6,429 5,757 11.7 Income taxes 2,009 1,771 13.4 ----------- ----------- ------- Net income $4,420 $3,986 10.9 =========== =========== ======= Basic earnings per common share $0.23 $0.21 9.5 Diluted earnings per common share $0.23 $0.20 15.0 Analysis of Net Interest Income - ---------------------------------------------------------------------- for the quarter ended March 31, (dollars in thousands) 2005 ---------------------------- (unaudited) Average Average Balance Interest Rate ----------- -------- ------- Assets Interest earning assets: Loans (1) $946,417 $14,985 6.33 % Taxable securities (4) 346,224 2,725 3.15 Tax-exempt securities (2) (4) 35,076 457 5.21 Interest earning deposits 2 - - Federal funds sold 62 - - ----------- -------- ------- Total interest-earning assets 1,327,781 18,167 5.47 -------- Non-interest earning assets: Cash and due from banks 34,875 Allowance for loan and lease losses (9,874) Other assets 115,435 ----------- Total assets $1,468,217 =========== Liabilities and stockholders' equity Interest-bearing liabilities Interest bearing deposits $997,141 3,922 1.57 Borrowings 72,042 519 2.88 ----------- -------- ------- Total interest-bearing liabilities 1,069,183 4,441 1.66 -------- Non-interest bearing liabilities Demand deposits 238,549 Other liabilities 9,433 ----------- Total liabilities (3) 1,317,165 Stockholders' equity 151,052 ----------- Total liabilities and stockholders' equity $1,468,217 =========== Net interest income (tax-equivalent basis) 13,726 3.81 Tax-equivalent basis adjustment (162) -------- Net interest income $13,564 ======== Net interest income as a percent of interest-earning assets (tax-equivalent basis) 4.14 % for the quarter ended March 31, (dollars in thousands) 2004 ----------- -------- -------- (unaudited) Average Average Balance Interest Rate ----------- -------- -------- Assets Interest earning assets: Loans (1) $806,387 $12,748 6.32 % Taxable securities (4) 397,591 2,689 2.71 Tax-exempt securities (2) (4) 28,898 388 5.37 Interest earning deposits 12 - - Federal funds sold 2,507 6 0.96 ----------- -------- -------- Total interest-earning assets 1,235,395 15,831 5.13 -------- Non-interest earning assets: Cash and due from banks 35,547 Allowance for loan and lease losses (9,636) Other assets 118,933 ----------- Total assets $1,380,239 =========== Liabilities and stockholders' equity Interest-bearing liabilities Interest bearing deposits $933,522 2,827 1.21 Borrowings 65,364 310 1.90 ----------- -------- -------- Total interest-bearing liabilities 998,886 3,137 1.26 -------- Non-interest bearing liabilities Demand deposits 224,100 Other liabilities 14,013 ----------- Total liabilities (3) 1,236,999 Stockholders' equity 143,240 ----------- Total liabilities and stockholders' equity $1,380,239 =========== Net interest income (tax-equivalent basis) 12,694 3.87 Tax-equivalent basis adjustment (160) -------- Net interest income $12,534 ======== Net interest income as a percent of interest-earning assets (tax-equivalent basis) 4.11 % - ---------------------------------------------------------------------- (1) Nonaccrual loans and any related interest recorded have been included in computing the average rate earned on the loan portfolio. When applicable, tax exempt loans are computed on a fully taxable equivalent basis using the corporate federal tax rate of 34%. (2) Computed on a fully taxable equivalent basis using the corporate federal tax rate of 34%. (3) All deposits are in domestic bank offices. (4) The average balances are based on historical cost and do not reflect unrealized gains or losses. STATEMENT OF CONDITION - SELECTED DATA (Period Ending) March 31, December 31, 3 month 2005 2004 Change ---------- ---------- ---------- (unaudited) Loans $977,089 $934,181 4.6 % Securities 371,439 388,729 (4.4) Earning assets 1,348,530 1,322,912 1.9 Total Assets 1,488,849 1,464,141 1.7 Deposits 1,231,396 1,246,138 (1.2) Borrowings 95,586 59,001 62.0 Shareholders' equity 151,207 150,155 0.7 Leverage ratio 6.72 % 6.49 % Risk weighted ratios: Tier 1 9.25 9.36 Total 10.20 10.35 March 31, 12 month 2004 Change ----------- --------- (unaudited) Loans $831,286 17.5 % Securities 388,155 (4.3) Earning assets 1,240,152 8.7 Total Assets 1,378,765 8.0 Deposits 1,166,126 5.6 Borrowings 53,242 79.5 Shareholders' equity 144,818 4.4 Leverage ratio 6.21 % Risk weighted ratios: Tier 1 9.23 Total 10.32 Asset quality Quarter ended March 31, December 31, 3 month 2005 2004 Change ------------- ------------ --------- (unaudited) Net charge offs $96 $225 (57.3)% Loan loss allowance (9,876) (9,797) 0.8 Nonperforming loans $7,774 $9,133 (14.9) Restuctured Loans - - - Foreclosed real estate & other repossessed assets 150 156 (3.8) ------------- ------------ --------- Total Nonperforming assets ("NPA") $7,924 $9,289 (14.7) ============= ============ ========= Ratio's - --------------------------------- Net charge offs as % of average loans (annualized) 0.04 % 0.10 % Loan loss allowance as % of period-end loans 1.01 1.05 Loan loss allowance as % of nonperforming loans 127.0 107.3 NPA's as a percent of loans + foreclosed assets 0.81 0.99 Quarter ended March 31, 12 month 2004 Change ----------------- -------------- (unaudited) Net charge offs $381 (74.8)% Loan loss allowance (9,635) 2.5 Nonperforming loans $8,465 (8.2) Restuctured Loans - - Foreclosed real estate & other repossessed assets 219 (31.5) ----------------- -------------- Total Nonperforming assets ("NPA") $8,684 (8.8) ================= ============== Ratio's - ------------------------------------ Net charge offs as % of average loans (annualized) 0.19 % Loan loss allowance as % of period- end loans 1.16 Loan loss allowance as % of nonperforming loans 113.8 NPA's as a percent of loans + foreclosed assets 1.04 PROFITABILITY (dollars in thousands, except per share Quarter ended data) March 31, December 3 31, month 2005 2004 Change ----------- ----------- ------ (unaudited) (unaudited) Net interest income (taxable equivalent) $13,726 $13,660 0.5 % Provision for loan and lease losses 175 225 (22.2) Net gain on sale of securities 67 462 (85.5) Non-interest income, excluding net gain on sale of securities 2,127 2,911 (26.9) Non-interest expense 9,154 9,026 1.4 Net income $4,420 $5,212 (15.2) Return on average assets 1.20 % 1.42 % Return on average equity 11.70 14.00 Return on average tangible equity 19.32 23.37 Net interest margin 4.14 4.10 Basic earnings per common share (1) $0.23 $0.27 (14.8)% Diluted earnings per common share (1) 0.23 0.27 (14.8) Dividends declared per common share (1) 0.09 0.08 12.5 Book value per common share - end of period (1) $7.90 $7.85 0.6 Shares outstanding - end of period (1) 19,144 19,120 0.1 Weighted average shares outstanding (1) Basic (1) 19,134 19,124 0.0 Diluted (1) 19,556 19,476 0.4 12 March 31, month 2004 Change ---------------- ---------- (unaudited) Net interest income (taxable equivalent) $12,694 8.1 % Provision for loan and lease losses 375 (53.3) Net gain on sale of securities 514 (87.0) Non-interest income, excluding net gain on sale of securities 2,001 6.3 Non-interest expense 8,917 2.7 Net income $3,986 10.9 Return on average assets 1.16 % Return on average equity 11.13 Return on average tangible equity 18.89 Net interest margin 4.11 Basic earnings per common share (1) $0.21 9.5 % Diluted earnings per common share (1) 0.20 15.0 Dividends declared per common share (1) 0.08 12.5 Book value per common share - end of period (1) $7.58 4.2 Shares outstanding - end of period (1) 19,110 0.2 Weighted average shares outstanding (1) Basic (1) 19,150 (0.1) Diluted (1) 19,543 0.1 (1) Adjusted for 3 for 2 stock split declared on January 18, 2005 payable on February 18, 2005 Contacts: Keating & Co. Lauren Mackiel, 973-966-1100 or Interchange Bank Charles Field, 201-703-2265 ### -----END PRIVACY-ENHANCED MESSAGE-----