-----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, F8j47HY47oPEcccgHqO2ez0irIVY5ChZ4Q9LuQb2Qf5B4yB8ubk5XXuFzbc65VXs +J8+TxC7Aag0OFWRceX9zA== 0000921768-98-000010.txt : 19980817 0000921768-98-000010.hdr.sgml : 19980817 ACCESSION NUMBER: 0000921768-98-000010 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 19980630 FILED AS OF DATE: 19980814 SROS: NASD SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: BANKATLANTIC BANCORP INC CENTRAL INDEX KEY: 0000921768 STANDARD INDUSTRIAL CLASSIFICATION: SAVINGS INSTITUTION, FEDERALLY CHARTERED [6035] IRS NUMBER: 650507804 STATE OF INCORPORATION: FL FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 000-27228 FILM NUMBER: 98689094 BUSINESS ADDRESS: STREET 1: 1750 E SUNRISE BLVD CITY: FORT LAUDERDALE STATE: FL ZIP: 33304 BUSINESS PHONE: 9547605000 MAIL ADDRESS: STREET 1: 1750 EAST SUNRISE BOULEVARD CITY: FORT LAUDERVALE STATE: FL ZIP: 33304 10-Q 1 FORM 10Q SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ___________________________ [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 1998 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _______ to _______ Commission file number 34-027228 --------- BANKATLANTIC BANCORP, INC. -------------------------- (Exact name of registrant as specified in its Charter) Florida 65-0507804 ------- ---------- (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 1750 East Sunrise Boulevard Ft. Lauderdale, Florida 33304 --------------------------- ----- (Address of principal executive offices) (Zip Code) (954) 760-5000 -------------- (Registrant's telephone number, including area code) Not Applicable -------------- (Former name, former address and former fiscal year, if changed since last report) Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months, and (2) has been subject to such filing requirements for the past 90 days. YES [X] NO [ ] Indicate the number of shares outstanding of each of the issuer's classes of preferred and common stock as of the latest practicable date. Outstanding at Title of Each Class August 5, 1998 ------------------- -------------- Class A Common Stock, par value $0.01 per share 26,707,537 Class B Common Stock, par value $0.01 per share 10,382,688 TABLE OF CONTENTS Page FINANCIAL INFORMATION Reference --------- Financial Statements................................................. 1-11 Consolidated Statements of Financial Condition - June 30, 1998 and 1997 and December 31, 1997 - Unaudited........... 1 Consolidated Statements of Operations - For the Three and Six Months Ended June 30, 1998 and 1997 - Unaudited................ 2 Consolidated Statements of Stockholders' Equity for the Six Months Ended June 30, 1998 and 1997 - Unaudited.................... 3 Consolidated Statements of Cash Flows - For the Six Months Ended June 30, 1998 and 1997 - Unaudited................................. 4-5 Notes to Consolidated Financial Statements - Unaudited............... 6-11 Management's Discussion and Analysis of Financial Condition and Results of Operations.......................................... 12-19 OTHER INFORMATION Exhibits and Reports on Form 8K...................................... 20 Signatures........................................................... 21 [THIS PAGE INTENTIONALLY LEFT BLANK]
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION - UNAUDITED June 30, December 31, June 30, (In thousands, except share data) 1998 1997 1997 --------- ----------- --------- ASSETS Cash and due from depository institutions ....................................... $ 87,280 $ 82,787 $ 82,490 Federal Funds sold............................................................... 0 0 7,808 Loans receivable, net ........................................................... 2,501,965 1,911,263 1,921,197 Loans available for sale ........................................................ 211,828 161,562 12,783 Investment securities-net, held to maturity, at cost which approximates market value ................................................................. 64,559 55,213 68,587 Securities available for sale, at market value .................................. 513,550 607,490 449,422 Trading securities, at market value.............................................. 34,460 5,067 0 Accrued interest receivable ..................................................... 27,533 22,624 21,254 Investments in real estate held for development and sale and joint ventures, net 42,280 18,638 0 Real estate owned, net .......................................................... 5,775 7,528 4,618 Office properties and equipment, net ............................................ 55,665 51,130 47,494 Federal Home Loan Bank stock, at cost which approximates market value ........... 54,704 34,887 24,637 Mortgage servicing rights ....................................................... 48,146 38,789 30,491 Deferred tax asset, net ......................................................... 6,811 3,197 3,253 Cost over fair value of net assets acquired ..................................... 57,765 26,188 27,414 Other assets .................................................................... 44,250 38,117 29,026 --------- --------- --------- Total assets .................................................................... $3,756,571 $3,064,480 $2,730,474 ========= ========= ========= LIABILITIES AND STOCKHOLDERS' EQUITY Liabilities: Deposits ........................................................................ $1,812,631 $ 1,763,733 $1,768,087 Advances from FHLB .............................................................. 1,059,061 697,707 467,704 Federal Funds purchased ......................................................... 13,600 2,500 0 Securities sold under agreements to repurchase .................................. 202,489 58,716 105,544 Subordinated debentures and notes payable ....................................... 181,300 179,600 78,300 Guaranteed preferred beneficial interests in the Company's Junior Subordinated Debentures....................................................... 74,750 74,750 74,750 Advances by borrowers for taxes and insurance ................................... 81,472 39,397 47,072 Other liabilities ............................................................... 76,017 40,906 35,442 --------- --------- --------- Total liabilities ............................................................... 3,501,320 2,857,309 2,576,899 --------- --------- --------- STOCKHOLDERS' EQUITY: Preferred stock, $0.01 par value, 10,000,000 shares authorized: none issued and outstanding .................................................. 0 0 0 Class A Common Stock, $0.01 par value, authorized 80,000,000 shares; issued and outstanding, 26,300,906, 21,509,159 and 17,383,314 shares .......... 263 215 118 Class B Common Stock, $0.01 par value, authorized 45,000,000 shares; issued and outstanding, 10,375,215, 10,690,231 and 10,735,440 shares .......... 104 107 107 Additional paid-in capital ...................................................... 145,224 98,475 57,747 Unearned compensation retention pool - restricted stock grants .................. (8,071) 0 0 Retained earnings ............................................................... 117,472 107,650 94,606 ------- ------- ------ Total stockholders' equity before accumulated other comprehensive income ........ 254,992 206,447 152,578 Accumulated other comprehensive income - net unrealized appreciation on securities available for sale - net of deferred income taxes .............. 259 724 997 --------- --------- --------- Total stockholders' equity ...................................................... 255,251 207,171 153,575 --------- --------- --------- Total liabilities and stockholders' equity ...................................... $3,756,571 $3,064,480 $2,730,474 ========= ========= ========= See Notes to Consolidated Financial Statements - Unaudited
CONSOLIDATED STATEMENTS OF OPERATIONS - UNAUDITED For the Three Months For the Six Months (In thousands, except share data) Ended June 30, Ended June 30, ------------------------ ------------------------ Interest income: 1998 1997 1998 1997 ---------- ---------- ---------- ---------- Interest and fees on loans and leases .................................... $ 55,024 $ 41,948 $ 102,135 $ 83,071 Interest on banker's acceptances ......................................... 383 0 871 0 Interest and dividends on securities available for sale .................. 7,385 8,246 17,372 15,788 Interest and dividends on investment securities held to maturity and trading securities ...................................................... 2,231 1,852 4,455 3,631 ---------- ---------- ---------- ---------- Total interest income .................................................... 65,023 52,046 124,833 102,490 Interest expense: Interest on deposits ..................................................... 16,659 17,042 33,117 34,317 Interest on advances from FHLB ........................................... 13,760 6,266 24,472 11,067 Interest on securities sold under agreements to repurchase ............... 3,072 2,309 6,152 4,858 Interest on subordinated debentures, guaranteed preferred interest in the Company's Junior Subordinated Debentures and notes payable ...... 4,712 2,775 9,579 4,314 Capitalized interest on investments in and advances to joint ventures..... (218) 0 (218) 0 ---------- ---------- ---------- ---------- Total interest expense ................................................... 37,985 28,392 73,102 54,556 ---------- ---------- ---------- ---------- Net interest income ...................................................... 27,038 23,654 51,731 47,934 Provision for loan losses ................................................ 3,371 2,686 6,778 5,162 ---------- ---------- ---------- ---------- Net interest income after provision for loan losses ...................... 23,667 20,968 44,953 42,772 ---------- ---------- ---------- ---------- Non-interest income: Loan servicing and other loan fees ....................................... 906 1,405 1,398 2,976 Gains on sales of loans available for sale ............................... 1,104 714 2,832 1,165 Gains on sales of mortgage servicing rights .............................. 362 2,201 2,400 4,634 Gains on sales of securities available for sale .......................... 473 689 2,193 942 Unrealized and realized gains on trading securities ...................... 532 0 703 0 Real estate held for development and sale and joint venture activity, net. 3,954 0 3,003 0 Transaction fees ......................................................... 3,040 2,267 5,640 4,412 ATM fees ................................................................. 1,590 1,351 2,887 2,665 Other .................................................................... 1,111 1,007 1,951 1,864 ---------- ---------- ---------- ---------- Total non-interest income ................................................ 13,072 9,634 23,007 18,658 ---------- ---------- ---------- ---------- Non-interest expense: Employee compensation and benefits ....................................... 12,014 9,286 23,482 18,833 Occupancy and equipment .................................................. 5,426 4,245 10,554 9,037 Federal insurance premium ................................................ 258 345 520 553 Advertising and promotion ................................................ 1,693 525 2,184 894 Foreclosed asset activity, net ........................................... 125 15 (44) 28 Amortization of cost over fair value of net assets acquired .............. 701 627 1,360 1,254 Other .................................................................... 5,766 4,400 10,837 9,244 ---------- ---------- ---------- ---------- Total non-interest expense ............................................... 25,983 19,443 48,893 39,843 ---------- ---------- ---------- ---------- Income before income taxes ............................................... 10,756 11,159 19,067 21,587 Provision for income taxes ............................................... 4,365 4,338 7,420 8,425 ---------- ---------- ---------- ---------- Net income ............................................................... $ 6,391 $ 6,821 $ 11,647 $ 13,162 ========== ========== ========== ========== Basic earnings per share Class A common stock ............................ $ 0.20 $ 0.24 $ 0.37 $ 0.46 ========== ========== ========== ========== Basic earnings per share Class B common stock ............................ $ 0.18 $ 0.23 $ 0.33 $ 0.45 ========== ========== ========== ========== Diluted earnings per share Class A common stock .......................... $ 0.16 $ 0.19 $ 0.29 $ 0.37 ========== ========== ========== ========== Diluted earnings per share Class B common stock .......................... $ 0.15 $ 0.19 $ 0.28 $ 0.37 ========== ========== ========== ========== Basic weighted average shares outstanding Class A common stock ........... 22,724,683 17,940,645 22,269,820 18,042,902 ========== ========== ========== ========== Basic weighted average shares outstanding Class B common stock ........... 10,425,815 10,742,040 10,596,437 10,656,193 ========== ========== ========== ========== Diluted weighted average shares outstanding Class A common stock ......... 39,320,600 26,933,436 39,039,828 27,007,861 ========== ========== ========== ========== Diluted weighted average shares outstanding Class B common stock ......... 11,384,648 11,767,040 11,630,834 11,727,887 ========== ========== ========== ========== See Notes to Consolidated Financial Statements - Unaudited
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY FOR THE SIX MONTHS ENDED JUNE 30, 1998 AND 1997 Unearned Compen- Net sation Unrealized Retention Appreci- Addi- Pool - ation on Compre- tional Restricted Securities hensive Common Paid-in Retained Stock Available (In thousands) Income Stock Capital Earnings Grants For Sale Total ------- ------ ------- -------- ---------- ---------- ------- BALANCE, DECEMBER 31, 1996 ........................ $ 183 $ 64,171 $ 82,602 $ 0 $ 748 $147,704 Comprehensive income Net income ....................................... $13,162 0 0 13,162 0 0 13,162 ------ Other comprehensive income, net of tax: Unrealized gain on securities available for sale 766 Reclassification adjustment for gains and (losses)included in net income ................. (517) ------ Other comprehensive income ...................... 249 ------ Comprehensive income .............................. $13,411 ====== Dividends on Class A common stock ................. 0 0 (487) 0 0 (487) Dividends on Class B common stock ................. 0 0 (623) 0 0 (623) Exercise of Class B common stock options .......... 2 1,266 0 0 0 1,268 Tax effect relating to the exercise of stock options ......................................... 0 365 0 0 0 365 Purchase and retirement of Class A common stock ... (7) (7,416) 0 0 0 (7,423) Purchase and retirement of Class B common stock ... (1) (839) 0 0 0 (840) Issuance of Class A common stock upon conversion of subordinated debentures, net .................. 0 200 0 0 0 200 5 for 4 stock split ............................... 48 0 (48) 0 0 0 Net change in unrealized appreciation (depreciation) on securities available for sale-net of deferred income taxes...................................... 0 0 0 0 249 249 ------ ------- -------- --------- --------- ------- BALANCE, JUNE 30, 1997 ............................ $ 225 $ 57,747 $ 94,606 $ 0 $ 997 $153,575 ====== ======= ======== ========= ========= ======= BALANCE, DECEMBER 31, 1997 ........................ $ 322 $ 98,475 $ 107,650 $ 0 $ 724 $207,171 Net income ....................................... $11,647 0 0 11,647 0 0 11,647 ------ Other comprehensive income, net of tax: Unrealized gains (losses) on securities available for sale .............................. 225 Reclassification adjustment for gains and(losses) included in net income .......................... (690) ------ Other comprehensive income ....................... (465) ------ Comprehensive income .............................. $11,182 ====== Dividends on Class A common stock ................. 0 0 (1,318) 0 0 (1,318) Dividends on Class B common stock ................. 0 0 (507) 0 0 (507) Exercise of Class A common stock options .......... 0 156 0 0 0 156 Exercise of Class B common stock options .......... 4 1,322 0 0 0 1,326 Tax effect relating to the exercise of stock options ......................................... 0 676 0 0 0 676 Purchase and retirement of Class B common stock ... (7) (10,640) 0 0 0 (10,647) Issuance of Class A common stock for acquisitions . 43 42,391 0 0 0 42,434 Issuance of Class A common stock options upon acquisition of RBCO............................... 0 1,582 0 0 0 1,582 Issuance of Class A common stock upon conversion of subordinated debentures, net ..................... 5 3,191 0 0 0 3,196 Net change in unrealized appreciation (depreciation) on securities available for sale-net of deferred income taxes ..................................... 0 0 0 0 (465) (465) Unearned compensation retention pool- restricted stock grants...................................... 0 8,071 0 (8,071) 0 0 ------ ------- ------- --------- --------- ------- BALANCE, JUNE 30, 1998 ............................ $ 367 $145,224 $ 117,472 $ (8,071) $ 259 $255,251 ====== ======= ======== ========= ========= ======= See Notes to Consolidated Financial Statements - Unaudited
CONSOLIDATED STATEMENTS OF CASH FLOWS - UNAUDITED For the Six Months (In thousands, except share data) Ended June 30, ------------------------ Operating activities: 1998 1997 ---------- -------- Net income ...................................................................... $ 11,647 $ 13,162 Adjustments to reconcile net income to net cash provided by operating activities: Provision for loan losses ....................................................... 6,778 5,162 Provision for allowance for losses on real estate owned ......................... 475 0 Depreciation .................................................................... 3,046 2,410 Amortization of mortgage servicing rights ....................................... 7,597 3,647 Gains on sales of mortgage servicing rights ..................................... (2,400) (4,634) Decrease in deferred tax asset, net ............................................. (2,858) (53) Net accretion of securities ..................................................... (807) (247) Unrealized and realized (gains) losses on trading securities, net ............... (703) 12 Purchases of trading securities ................................................. (1,621) (6,417) Proceeds from sales of trading securities ....................................... 1,753 0 Net amortization of deferred loan origination fees .............................. (655) (510) Gains on sales of real estate owned ............................................. (915) (161) Gains on sales of real estate held for development and sale ..................... (5,259) 0 Gains on sales of securities available for sale ................................. (2,193) (943) Proceeds from sales of loans available for sale ................................. 144,741 55,791 Fundings of loans available for sale ............................................ (75,208) (51,850) Gains on sales of loans available for sale ...................................... (2,832) (1,165) Tax certificate recoveries ...................................................... (59) (231) Amortization of dealer reserve .................................................. 4,479 3,947 Amortization of cost over fair value of net assets acquired ..................... 1,360 1,254 Net accretion of purchase accounting adjustments ................................ (14) (231) Amortization of deferred borrowing costs ........................................ 392 194 Increase in accrued interest receivable ......................................... (4,909) (499) Decrease in other assets ........................................................ 1,515 12,995 Net losses (gains) on sales of property and equipment ........................... (1) 16 Income (loss) from joint ventures ............................................... (62) 0 Increase in other liabilities ................................................... 19,838 (1,135) ---------- -------- Net cash provided by operating activities ....................................... 103,125 30,514 ---------- -------- Investing activities: Proceeds from redemption and maturities of investment securities ................ 29,277 28,150 Purchase of investment securities ............................................... (38,564) (35,642) Proceeds from sales of securities available for sale ............................ 390,283 205,163 Principal collected on securities available for sale ............................ 69,416 76,178 Purchases of securities available for sale ...................................... (365,390) (283,310) Proceeds from sales of FHLB stock ............................................... 0 1,550 FHLB stock acquired ............................................................. (19,817) (11,400) Principal reduction on loans .................................................... 676,159 347,245 Loan fundings for portfolio ..................................................... (519,690) (248,637) Loans purchased ................................................................. (1,022,314) (216,156) Proceeds from maturities of banker's acceptances ................................ 210,459 287 Purchases of banker's acceptances ............................................... (94,445) (77) Proceeds from sales of banker's acceptances ..................................... 41,877 0 Additions to dealer reserve ..................................................... (4,682) (5,240) Proceeds from sales of real estate owned ........................................ 5,272 1,591 Mortgage servicing rights acquired .............................................. (36,641) (20,278) Proceeds from sales of mortgage servicing rights ................................ 16,145 6,628 Cost of equipment acquired for lease ............................................ (9,473) 0 Additions to office property and equipment ...................................... (4,545) (1,646) Investment in and advances to joint ventures .................................... (20,489) 0 Proceeds from sales of real estate held for development and sale ................ 9,536 0 Additional investment in real estate held for development and sale .............. (4,443) 0 Acquisitions, net of cash acquired .............................................. 433 0 ----------- -------- Net cash used in investing activities ........................................... (691,636) (155,594) ----------- -------- See Notes to Consolidated Financial Statements - Unaudited (Continued)
CONSOLIDATED STATEMENTS OF CASH FLOWS - UNAUDITED (CONTINUED) For the Six Months Ended June 30, ---------------------- 1998 1997 --------- --------- Financing activities: Net increase (decrease) in deposits ................................................... $ 21,393 $ (91,978) Interest credited to deposits ......................................................... 27,505 27,202 Repayments of FHLB advances ........................................................... (380,646) (320,000) Proceeds from FHLB advances ........................................................... 742,000 492,004 Net increase (decrease) in securities sold under agreements to repurchase ............. 143,773 (85,044) Net increase (decrease) in federal funds purchased .................................... 11,100 (1,660) Repayment of notes payable ............................................................ (6,522) 0 Increase in notes payable ............................................................. 3,162 0 Proceeds from issuance of guaranteed preferred interests in the Company's junior subordinated debentures ............................................................. 0 74,750 Issuance of common stock relating to exercise of employee stock options ............... 1,482 1,268 Payments to acquire and retire common stock ........................................... (10,647) (8,263) Receipts of advances by borrowers for taxes and insurance ............................. 42,075 17,413 Common stock dividends paid ........................................................... (1,671) (1,117) --------- -------- Net cash provided by financing activities ............................................ 593,004 104,575 --------- -------- Increase (decrease) in cash and cash equivalents ..................................... 4,493 (20,505) Cash and cash equivalents at beginning of period ...................................... 82,787 102,995 --------- -------- Cash and cash equivalents at end of period ............................................ $ 87,280 $ 82,490 ========= ======== Supplementary disclosure and non-cash investing and financing activities: Interest paid on borrowings and deposits .............................................. $ 69,863 $ 52,600 Income taxes paid ..................................................................... 5,416 9,306 Loans transferred to real estate owned ................................................ 3,079 1,130 Proceeds receivable from sales of mortgage servicing rights ........................... 13,330 9,148 Purchased residential loans held for investment transferred to held for sale .......... 108,465 0 Accrual for purchase of tax certificates paid in July ................................. 5,035 6,353 Issuance of Class A common stock upon acquisitions .................................... 42,434 0 Issuance of Class A common stock options upon acquisition ............................. 1,582 0 Issuance of Class A common stock upon conversion of subordinated debentures .......... 3,196 200 Decrease in deferred offering costs upon conversion of subordinated debentures ........ 117 0 Decrease in subordinated debentures upon conversion to Class A common stock ........... (3,313) 0 Loan charge-offs ...................................................................... 7,072 4,856 Tax certificate charge-offs (recoveries), net ......................................... 262 (507) Class A common stock dividends; not paid until July ................................... 719 234 Class B common stock dividends; not paid until July ................................... 252 310 Increase in equity for the tax effect related to the exercise of employee stock options 676 365 Change in net unrealized appreciation (depreciation) on securities available for sale . (756) 404 Change in deferred taxes on net unrealized appreciation (depreciation) on securities available for sale ................................................................... (291) 155 Change in stockholders' equity from net unrealized appreciation (depreciation) on securities available for sale, less related deferred income taxes ................ (465) 249 Increase in real estate held for development and sale resulting from St. Lucie West Holding Company ("SLWHC") purchase accounting adjustments ........................... 1,502 0 Decrease in other assets resulting from SLWHC purchase accounting adjustments ......... (1,502) 0 ========= ======== See Notes to Consolidated Financial statements - Unaudited
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - UNAUDITED 1. PRESENTATION OF INTERIM FINANCIAL STATEMENTS BankAtlantic Bancorp, Inc. (the "Company") is a unitary savings bank holding company. The Company's primary asset is the capital stock of BankAtlantic, its wholly owned subsidiary. Under applicable law, the Company generally has broad authority with few restrictions to engage in various types of business activities. The Company's primary activities relate to the operations of BankAtlantic and BankAtlantic's subsidiaries. However, on June 30, 1998 the Company acquired Ryan, Beck & Co., ("RBCO") an investment banking firm which is being operated as an independent autonomous subsidiary of the Company. On March 20, 1998, Leasing Technology Inc. ("LTI") was also acquired by the Company but it was intended to be operated as a wholly owned subsidiary of BankAtlantic, subject to receipt of regulatory approval. Such approval was obtained on June 30, 1998 and the Company contributed LTI to BankAtlantic at the Company's cost . All significant intercompany balances and transactions have been eliminated in consolidation. In management's opinion, the accompanying consolidated financial statements contain such adjustments necessary to present fairly the Company's consolidated financial condition at June 30, 1998 and 1997, the consolidated results of operations for the three and six months ended June 30, 1998 and 1997, the consolidated stockholders' equity for the six months ended June 30, 1998 and 1997 and the consolidated cash flows for the six months ended June 30, 1998 and 1997. Such adjustments consisted only of normal recurring items. The consolidated financial statements and related notes are presented as permitted by Form 10Q and should be read in conjunction with the notes to consolidated financial statements appearing in the Company's Annual Report on Form 10K for the year ended December 31, 1997 and the March 31, 1998 Form 10Q. 2. EQUITY CAPITAL Pursuant to previously announced plans to purchase shares of its common stock, during the six months ended June 30, 1998, the Company paid $10.6 million to repurchase and retire 738,500 shares of Class B common stock and during the six months ended June 30, 1997, the Company paid $7.4 million and $840,438 to repurchase 708,750 shares and 75,000 shares of Class A and Class B common shares, respectively. During the six months ended June 30, 1998, the Company issued 505,793 shares of Class A common stock upon the conversion of $3.3 million in principal amount of the Company's 6 3/4% Convertible Subordinated Debentures due 2006 (the "6 3/4% Convertible Debentures") at a conversion price of $6.55. This conversion increased stockholders' equity $3.2 million, net of offering costs. During the six months ended June 30, 1998, the Company issued 2,863,367 and 718,413 shares of Class A common stock to acquire RBCO and LTI, respectively (see also Note 7 "Acquisitions"). Upon acquisition of RBCO, the Company assumed all options outstanding under RBCO's existing stock option plans resulting in the issuance of options to purchase 314,145 shares of Class A common stock at various exercise prices based upon the exercise prices of the assumed options. Furthermore, pursuant with the RBCO acquisition agreement 683,362 restricted shares of Class A Common Stock were placed in an incentive and retention pool for the benefit of certain RBCO employees. The incentive and retention pool has a four year vesting period from the date of acquisition. The following table sets forth all outstanding options: Outstanding Outstanding Options Options Class B Class A ----------- ----------- Options Outstanding at December 31, 1997 2,115,547 1,616,632 Options Issued in connection with the acquisition of RBCO .................. 0 314,145 Options granted ........................ 0 61,250 Options Exercised ...................... (429,799) (10,989) Options Canceled ....................... (2,877) (36,203) ---------- ----------- Options Outstanding at June 30, 1998 ... 1,682,871 1,944,835 ========== =========== Exercisable at June 30, 1998 ........... 75,289 184,275 ========== =========== Exercise price per share outstanding ... $3.90-$4.00 $3.97-$14.38 ========== =========== 3. SALES OF FINANCIAL ASSETS During the six months ended June 30, 1998, the Company sold $19.7 million of mortgage servicing rights relating to approximately $1.3 billion of underlying loans realizing gains of $2.0 million.. In addition, the Company realized $362,000 of deferred revenues relating to mortgage servicing rights sold during prior periods. During the three and six months ended June 30, 1997, the Company sold $5.8 million and $11.1 million of mortgage servicing rights realizing gains of $2.2 million and $4.6 million, respectively. These mortgage servicing rights related to approximately $496.1 million and $1.0 billion of loans, respectively. Included in other assets at June 30, 1998 and December 31, 1997 were $13.3 million and $9.1 million of receivables, respectively, from the sales of mortgage servicing rights. During the three and six months ended June 30, 1998, the Company sold $72.3 million and $388.1 million of securities available for sale for an aggregate gain of $473,000 and $2.2 million, respectively. During the three and six months ended June 30, 1997, the Company sold $113.0 million and $204.2 million of securities available for sale for aggregate gains of $689,000 and $942,000, respectively. During the three and six months ended June 30, 1998, the Company sold $48.0 million and $141.9 million of loans held for sale for gains of $1.1 million and $2.8 million, respectively. During the three and six months ended June 30, 1998, the Company transferred $58.1 million and $108.5 million of purchased residential loans from the held for investment category to the loans held for sale category. As part of its normal operations the Company purchases bulk residential loans and continually evaluates the portfolio. These evaluations may result in transfers from the held for investment category to the held for sale category; however, such transfers would not normally exceed 10% of the average annual balance of the portfolio. During the three and six months ended June 30, 1997, the Company sold $30.0 million and $54.6 million of loans held for sale for gains $714,000 and $1.2 million, respectively. 4. TRADING SECURITIES The unrealized and realized gains (losses) on trading securities for the three and six months ended June 30, 1998 were $(28,000) and $560,000 and $143,000 and $560,000, respectively. Included in trading account securities were $27.7 million of securities owned by RBCO at June 30, 1998. Included in other liabilities was $3.3 million of securities sold not yet purchased. The Company's trading securities consist of the following (in thousands): June 30, December 31, 1998 1997 ------- ----------- Debt obligations: States and municipalities .. $10,270 $ 0 Corporations ............... 636 0 U.S. Government and agencies 431 0 Corporate equities ........... 23,098 5,067 Other ........................ 25 0 ------ ------ $34,460 $ 5,067 ====== ====== 5. REAL ESTATE HELD FOR DEVELOPMENT AND SALE AND JOINT VENTURE ACTIVITIES In October 1997, BankAtlantic acquired the St. Lucie West Holding Corp. ("SLWHC"), the developer of the master planned community of St. Lucie West in St. Lucie County, Florida. Upon further evaluation of the fair value of the assets acquired in connection with the SLWHC acquisition, other assets was reduced by $1.5 million with a corresponding increase in real estate held for development and sale. During the three and six months ended June 30, 1998, SLWHC land sales resulted in gains of $5.2 million and $5.3 million, respectively, the Company invested an additional $3.6 million and $4.4 million in SLWHC, respectively, and SLWHC had operating expenses of $1.3 million and $2.3 million, respectively. Additionally, during the three and six months ended June 30, 1998 the Company's investments and advances to other real estate joint ventures increased by $1.3 million and $20.5 million, respectively. Furthermore, the Company capitalized $218,000 of interest expense in connection with investments in and advances to joint ventures' activities. 6. COMPREHENSIVE INCOME In June 1997 the FASB issued Statement No. 130 ("FAS 130") "Reporting Comprehensive Income". FAS 130 became effective for the Company on January 1, 1998 with earlier financial statements reclassified to reflect its application. Comprehensive income is the change in equity of a business enterprise during a period from transactions and other events and circumstances from nonowner sources. Some of the items included in comprehensive income are unrealized gains and losses on securities available for sale, foreign currency translations and underfunded pension obligations. Reclassification adjustments are made to avoid double counting in comprehensive income items that are displayed as part of net income for a period that also had been displayed as part of other comprehensive income in an earlier period. Implementation of FAS 130 required additional disclosure in the Company's financial statements but had no impact on the Company's Statement of Financial Condition or Statement of Operations. The income tax benefit relating to the reclassification adjustment for the six months ended June 30, 1998 and 1997 was $434,000 and $324,000, respectively. 7. ACQUISITIONS In March 1998, the Company acquired LTI, a company engaged in the equipment leasing and finance business. For financial accounting purposes the acquisition was effective on March 1, 1998. LTI principally leases or finances trucks, and manufacturing and construction equipment to businesses located primarily in South Florida. In June 1998, BankAtlantic received regulatory approval and the capital stock of LTI was contributed by the Company to BankAtlantic effective June 30, 1998. The acquisition of LTI was accounted for under the purchase method of accounting as if the acquisition had occurred March 1, 1998. The results of LTI are included in the Company's results of Operations as of March 1, 1998. The Company will amortize goodwill over 25 years on a straight line basis. Based upon an appraisal from an independent third party, the estimated fair value of Class A common stock issued in the acquisition was reduced to reflect contractual transfer restrictions on the Company's stock received by the former LTI shareholders. This valuation was changed from 90% of the fair value to 65% based on a valuation appraisal report received from an independent third party. On June 30, 1998 the Company acquired all of RBCO's outstanding shares of common stock in exchange for shares of the Company's Class A common stock in an acquisition accounted for under the purchase method of accounting. RBCO will be operated as an autonomous independent wholly owned subsidiary under RBCO's management. RBCO is an investment firm that is principally engaged in the underwriting, distribution and trading of tax-exempt obligations and bank and thrift equity and debt securities. RBCO provides investment banking, research and financial advisory services primarily to financial services companies with a focus on corporate finance and merger-related services. RBCO offers a general securities brokerage business with investment products for retail and institutional clients, as well as life insurance and annuity products. RBCO's retail and institutional brokerage clients consist primarily of high net worth individuals (primarily residents of New Jersey, other Mid-Atlantic and Northeastern states and Florida), banking and thrift institutions (primarily located in New Jersey, Pennsylvania and Florida) and, to a much lesser extent, insurance companies and specialty finance companies. The principal executive office of RBCO is located in Livingston, New Jersey. RBCO is registered as a broker-dealer with the Securities and Exchange Commission ("SEC") and is a member of the National Association of Securities Dealers, Inc. ("NASD") and the Securities Investor Protection Corporation ("SIPC"). RBCO is not a member of any securities exchange. Brokerage services to retail and institutional customers are provided through RBCO's sales force of 84 sales account executives located in the Livingston and Shrewsbury, New Jersey, Bala Cynwyd, Pennsylvania, and West Palm Beach, Florida offices. The preliminary analysis of the fair value of assets acquired and liabilities assumed in connection with the acquisitions of RBCO and LTI effective June 30, 1998 and March 1, 1998, respectively, is as follows: In thousands RBCO LTI Total ------- ------- ------- Cash acquired .............................. $ 733 $ 0 $ 733 Leases receivable, net ..................... 0 8,419 8,419 Securities available for sale .............. 0 121 121 Trading account securities ................. 27,697 0 27,697 Property and equipment ..................... 2,916 119 3,035 Deferred income tax (liability) assets ..... 1,015 (551) 464 Other assets ............................... 4,104 975 5,079 Securities sold not yet purchased .......... (3,334) 0 (3,334) Notes payable .............................. (1,704) (6,670) (8,374) Other liabilities .......................... (7,709) (4,151) (11,860) Subordinated loan from the Company ......... (10,000) 0 (10,000) -------- -------- -------- Fair value of net tangible assets acquired . 13,718 (1,738) 11,980 -------- -------- -------- Estimated fair value of Class A common stock issued .................................... 35,017 0 35,017 Estimated fair value of restricted Class A common stock issued ....................... 1,634 5,783 7,417 Estimated fair value of Class A common stock options issued ............................ 1,582 0 1,582 Cash paid to shareholder ................... 0 300 300 Acquisition costs .......................... 500 100 600 -------- -------- -------- Total purchase price ....................... 38,733 6,183 44,916 -------- -------- -------- Cost over fair value of net assets acquired $ 25,015 $ 7,921 $ 32,936 ======== ======== ======== The net cash acquired in connection with both of the above acquisitions was $433,000. During March 1998, the Company extended RBCO a $10.0 million subordinated loan on an arms length basis to enable RBCO to expand into new products and markets. Upon acquisition, the loan was eliminated in consolidation. Included in cost over fair value of net assets acquired was $2.6 million of goodwill related to the February 1998 acquisition by RBCO of Cumberland Advisors and Cumberland Consulting. This valuation is subject to change based on a valuation appraisal on Class A restricted common stock issued in connection with the above transaction. The goodwill associated with the Cumberland entities will be amortized on a straight line basis over 15 years resulting in an annual expense of $171,000. This will be tax deductible and the remaining goodwill of $22.5 million associated with RBCO will be amortized on a straight line basis over 25 years resulting in an annual expense of $900,000 that will not be tax deductible. The following is proforma information for the six months ended June 30, 1998 and 1997 as if the RBCO acquisition was consummated on January 1, 1998 and 1997, respectively. The proforma information is not necessarily indicative of the results of operations which would have been realized had the acquisition been consummated as of the dates for which the proforma financial information is presented or future performance (in thousands, except for per share data): For the Six Months Ended ------------------------ June 30,1998 June 30,1997 ------------ ------------ Historical Proforma Historical Proforma ---------- -------- ---------- -------- Net interest income .............. $ 51,731 $ 52,010 $ 47,934 $ 48,246 ------- ------- ------- ------- Provision for loan losses ........ 6,778 6,778 5,162 5,162 ------- ------- ------- ------- Non-interest income .............. 23,007 45,442 18,658 33,202 Non-interest expense ............. 48,893 70,708 39,843 54,813 ------- ------- ------- ------- Provision for income taxes ....... 7,420 7,927 8,425 8,484 ------- ------- ------- ------- Net Income ....................... $ 11,647 $ 12,039 $ 13,162 $ 12,989 ======= ======= ======= ======= Basic earnings per share Class A . $ 0.37 $ 0.35 $ 0.46 $ 0.41 ======= ======= ======= ======= Basic earnings per share Class B . $ 0.33 $ 0.31 $ 0.45 $ 0.41 ======= ======= ======= ======= Diluted earnings per share Class A $ 0.29 $ 0.28 $ 0.37 $ 0.34 ======= ======= ======= ======= Diluted earnings per share Class B $ 0.28 $ 0.27 $ 0.37 $ 0.34 ======= ======= ======= ======= The RBCO acquisition agreement provided for the establishment of an incentive and retention pool, under which shares of the Company's Class A common stock representing 20% of the total transaction value was allocated to key employees of RBCO. The retention pool consists of 683,362 shares of restricted Class A common stock which will vest in four years to employees who remain for the period. The retention pool, valued at $8.1 million at the acquisition date, will be amortized to compensation expense over the four year vesting period and is tax deductible at the vesting date. Included in the Company's Statement of Financial Condition at June 30, 1998 were the assets and liabilities of RBCO. The operations of RBCO during the six months ended June 30, 1998 were not included in the Company's Statement of Operations. 8. NEW ACCOUNTING STANDARDS Financial Accounting Standards Board Statement No. 132, "Employers' Disclosures about Pensions and other Postretirement Benefits" ("FAS 132") was issued in February 1998. This statement revises employers' disclosures about pension and other postretirement benefit plans. It does not change the measurement or recognition of those plans. It standardizes the disclosure requirements for pensions and other postretirement benefits to the extent practical, requires additional information on changes in the benefit obligations and fair values of plan assets that will facilitate financial analysis, and eliminates certain disclosures that are no longer useful. The statement suggests combined formats for presentation of pension and other postretirement benefit disclosures. This statement is effective for fiscal years beginning after December 15, 1997. Implementation of FAS 132 will impact disclosure only, but will not have an impact on the Company's Consolidated Statement of Operations or Statement of Financial Condition. Financial Accounting Standards Board Statement No. 133, "Accounting for Derivative Instruments and Hedging Activities" ("FAS 133") was issued in June 1998. This statement establishes accounting and reporting standards for derivative instruments, including certain derivative instruments embedded in other contracts, (collectively referred to as derivatives) and for hedging activities. It requires that an entity recognize all derivatives as either assets or liabilities in the statement of financial position and measure those instruments at fair value. If certain conditions are met, a derivative may be specifically designated as (a) a hedge of the exposure to changes in the fair value of a recognized asset or liability or an unrecognized firm commitment, (b) a hedge of the exposure to variable cash flows of a forecasted transaction, or (c) a hedge of the foreign currency exposure of a net investment in a foreign operation, an unrecognized firm commitment, an available-for-sale security, or a foreign-currency-denominated forecasted transaction. The accounting for changes in the fair value of a derivative (that is, gains and losses) depends on the intended use of the derivative and the resulting designation. For a derivative designated as hedging the exposure to changes in the fair value of a recognized asset or liability or a firm commitment (referred to as a fair value hedge), the gain or loss is recognized in earnings in the period of change together with the offsetting loss or gain on the hedged item attributable to the risk being hedged. The effect of that accounting is to reflect in earnings the extent to which the hedge is not effective in achieving offsetting changes in fair value. For a derivative designated as hedging the exposure to variable cash flows of a forecasted transaction (referred to as a cash flow hedge), the effective portion of the derivative as a gain or loss is initially reported as a component of other comprehensive income (outside earnings) and subsequently reclassified into earnings when the forecasted transaction affects earnings. The ineffective portion of the gain or loss is reported in earnings immediately. For a derivative designated as hedging the foreign currency exposure of a net investment in a foreign operation, the gain or loss is reported in other comprehensive income (outside earnings) as part of the cumulative translation adjustment. The accounting for a fair value hedge described above applies to a derivative designated as a hedge of the foreign currency exposure of an unrecognized firm commitment or an available-for-sale security. Similarly, the accounting for a cash flow hedge described above applies to a derivative designated as a hedge of the foreign currency exposure of a foreign-currency-denominated forecasted transaction. For a derivative not designated as a hedging instrument, the gain or loss is recognized in earnings in the period of change. Under this statement, an entity that elects to apply hedge accounting is required to establish at the inception of the hedge the method it will use for assessing the effectiveness of the hedging derivative and the measurement approach for determining the ineffective aspect of the hedge. Those methods must be consistent with the entity's approach to managing risk. This statement is effective for all fiscal quarters of fiscal years beginning after June 15, 1999. Initial application of this statement should be as of the beginning of an entity's fiscal quarter; on that date, hedging relationships must be designated anew and documented pursuant to the provisions of this statement. Earlier application of all of the provisions of this statement is encouraged, but it is permitted only as of the beginning of any fiscal quarter that begins after issuance of this statement. This statement should not be applied retroactively to financial statements of prior periods. The Company intends to implement FAS 133, January 1, 2000 and its potential impact on the Statement of Operations and Statement of Condition is currently under review by management. 9. RECLASSIFICATIONS Certain amounts for prior periods have been reclassified to conform with statement presentation for 1998. [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK] MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS RESULTS OF OPERATIONS Except for historical information contained herein, the matters discussed in this report contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the "Securities Act"), and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), that involve substantial risks and uncertainties. When used in this report, the words "anticipate", "believe", "estimate", "may", "intend", "expect" and similar expressions identify certain of such forward-looking statements. Actual results, performance or achievements could differ materially from those contemplated, expressed or implied by the forward-looking statements contained herein. These forward-looking statements are based largely on the Company's expectations and are subject to a number of risks and uncertainties, including but not limited to, economic conditions, competitive and other factors affecting the Company's assets, operations, markets, products and services, as well as expansion strategies, including the addition of ATM machines and the success of its real estate activities, potential impact of change in interest rates, regulatory oversight and other factors discussed in the Company's Annual Report on Form 10K for the year ended December 31, 1997. Many of these factors are beyond the Company's control. The Company's basic and diluted earnings per share for Class A common stock were $0.20 and $0.16, respectively, for the three months ended June 30, 1998 compared to $0.24 and $0.19 for the comparable 1997 period. The Company's basic and diluted earnings per share for Class B common stock were $0.18 and $0.15, respectively, for the three months ended June 30, 1998 compared to $0.23 and $0.19 for the comparable 1997 period. The Company's net income declined from $6.8 million during the three months ended June 30, 1997 to $6.4 million during the comparable 1998 period. The primary reasons for the decline in net income were declines in loan servicing income, including accelerated amortization of premiums associated with mortgage servicing rights resulting from prepayments of the related mortgages, higher provisions for loan losses and expenses associated with the implementation of new business initiatives. The Company's basic and diluted earnings per share for Class A common stock were $0.37 and $0.29, respectively, for the six months ended June 30, 1998 compared to $0.46 and $0.37 for the comparable 1997 period. The Company's basic and diluted earnings per share for Class B common stock were $0.33 and $0.28, respectively, for the six months ended June 30, 1998 compared to $0.45 and $0.37 for the comparable 1997 period. The Company's net income declined from $13.2 million during the six months ended June 30, 1997 to $11.6 million during the comparable 1998 period. The primary reasons for the decline in net income were the same as discussed above for the three month period. NET INTEREST INCOME
For the Three Months Ended For the Six Months Ended June 30, June 30, ------------------------------- ------------------------------- (In thousands) 1998 1997 Change 1998 1997 Change ------- ------- ------- ------- ------- ------- Interest and fees on loans ............................... $ 55,024 $ 41,948 $ 13,076 $102,135 $ 83,071 $ 19,064 Interest on banker's acceptances ......................... 383 0 383 871 0 871 Interest and dividends on securities available for sale . 7,385 8,246 (861) 17,372 15,788 1,584 Interest and dividends on investment securities held to maturity and trading securities ........................ 2,231 1,852 379 4,455 3,631 824 Interest on deposits ..................................... (16,659) (17,042) 383 (33,117) (34,317) 1,200 Interest on advances from FHLB ........................... (13,760) (6,266) (7,494) (24,472) (11,067) (13,405) Interest on securities sold under agreements to repurchase (3,072) (2,309) (763) (6,152) (4,858) (1,294) Interest on subordinated debentures, notes payable and guaranteed preferred interest in the Company's Junior Subordinated Debentures .................................. (4,712) (2,775) (1,937) (9,579) (4,314) (5,265) Capitalized interest ..................................... 218 0 218 218 0 218 ------- ------- ------- ------- ------- ------- Net interest income .................................... $ 27,038 $ 23,654 $ 3,384 $ 51,731 $ 47,934 $ 3,797 ======= ======= ======= ======= ======= =======
The increase in interest and fees on loans during the three months ended June 30, 1998 compared to the same period in 1997 reflects higher average balances resulting from the purchase of residential loans and the origination of commercial mortgages, and international and small business loans. The additional interest income from higher loan balances was partially offset by lower rates earned on the loan portfolio due to a shift in the loan portfolio from higher yielding consumer and commercial loans to lower yielding residential loans. Residential loans as a percentage of total loans receivable increased from 47% at June 30, 1997 to 56% at June 30, 1998. Purchased residential loans, commercial mortgages, and international and small business loan balances increased from $998.6 million, $547.9 million, $0 and $6.9 million, respectively, at June 30, 1997 to $1.7 billion, $554.2 million, $50.4 million and $74.4 million, respectively, at June 30, 1998. The increase in banker's acceptances interest income resulted from the Company investing short term funds in banker's acceptances during 1998. The decrease in interest and dividends on securities available for sale resulted from lower average balances due to sales of securities and repayments of asset-backed securities partially offset by the purchases of securities available for sale. During the six months ended June 30, 1998, the Company sold $388.1 million of securities available for sale and purchased $365.4 million of securities available for sale. The balances of asset-backed securities declined from $16.6 million at June 30, 1997 to $1.2 million at June 30, 1998. As a result of the above purchases, sales and principal repayments, the average balances of securities available for sale declined from $543.8 million for the three months ended June 30, 1997 to $499.8 million for the comparable 1998 period. The increases in interest and dividends on investment securities during the 1998 three month period were primarily due to higher FHLB stock average balances. FHLB stock average balances increased from $20.3 million during the three months ended June 30, 1997 to $48.4 million during the comparable 1998 period. Increases in FHLB stock were required based on higher FHLB advance levels. The decrease in interest on deposits for the quarter ended June 30, 1998 compared to the 1997 quarter resulted from lower average interest bearing deposit balances and rates during 1998. Average interest bearing deposit balances decreased from $1.632 billion for the three months ended June 30, 1997 to $1.622 billion for the three months ended June 30, 1998, and average rates on deposits decreased from 4.19% during the 1997 second quarter to 4.12% during the comparable 1998 quarter. The decline in interest bearing deposit average balances and rates reflects lower certificate account balances due to the run-off of higher rate certificate accounts acquired in connection with the Bank of North America acquisition. The mix in the Company's deposit portfolio changed from 55% certificate accounts and 45% transaction accounts during the six months ended June 30, 1997 to 51% certificate accounts and 49% transaction accounts during the comparable 1998 period. The increase in interest expense on advances from FHLB was primarily due to higher average balances. Advances from FHLB average balances increased from $404.8 million during the second quarter of 1997 to $946.8 million during the comparable 1998 quarter. The additional FHLB borrowings were primarily intermediate term advances used to fund purchases of residential loans. The higher interest expense on securities sold under agreements to repurchase resulted from higher average balances during 1998. Securities sold under agreements to repurchase average balances increased from $172.3 million during the three months ended June 30, 1997 to $228.5 million during the comparable 1998 three month period. The increase in interest on subordinated debentures, guaranteed preferred interest in the Company's Junior Subordinated Debentures and notes payable resulted from the issuance in November 1997 of $100 million of 5 5/8% Convertible Subordinated Debentures due 2007 ("5 5/8% Convertible Debentures") as well as interest expense on $4.8 million of notes payable relating primarily to SLWHC and LTI. The proceeds from the issuance of the 5 5/8% Convertible Debentures and securities sold under agreements to repurchase were primarily used to fund residential loan purchases. During the six months ended June 30, 1998, net interest income increased by $3.6 million. The increase in interest income was impacted by higher average balances in all categories of interest earning assets partially offset by lower yields. Total interest earning assets increased from $2.5 billion during the six months ended June 30, 1997 to $3.2 billion during the comparable 1998 period while weighted average interest rates on interest earning assets declined from 8.32% during the 1997 six month period to 7.89% during the comparable 1998 period. The higher interest earning asset average balances and lower yields were primarily related to the items discussed above for the quarter. The increase in interest expense was impacted by higher interest bearing liabilities average balances and rates. Total interest bearing liabilities increased from $2.3 billion during the 1997 six month period to $2.9 billion during the comparable 1998 period while rates on interest bearing liabilities increased from 4.78% during 1997 to 5.03% during 1998. The higher interest bearing liabilities average balances and higher yields were primarily related to the items discussed above for the quarter. PROVISION FOR LOAN LOSSES The provision for loan losses for the second quarter 1998 was $3.4 million compared to $2.7 million during the comparable 1997 period. The higher 1998 provision for loan losses primarily resulted from an increase in net charge-offs from $1.7 million during the 1997 quarter to $3.1 million during the 1998 quarter. The increase in net charge-offs primarily resulted from a $783,000 charge-off of a factoring account which was fully reserved during the first quarter of 1998, $191,000 of lease financing net charge-offs and a $398,000 increase in consumer loan net charge-offs. The allowance for loan losses was increased by $650,000 to $30.6 million during the 1998 second quarter reflecting the transfer of $108,000 of leases sold with recourse from other liabilities to allowance for loan loss upon the repurchase of $4.4 million of leases previously sold to investors with recourse. The remaining increase in the allowance for loan losses was due to loan growth. During the three months ended June 30, 1997 the allowance for loan losses was increased by $1.0 million due primarily to allowances acquired in connection with the LTI acquisition, loan growth, increased consumer loan portfolio delinquencies, and consumer loan charge-off trends. The provision for loan losses for the six months ended June 30, 1998 increased by $1.6 million from the comparable 1997 period. The increase primarily related to higher consumer loan charge-offs, the factoring account mentioned above, and net charge-offs associated with LTI. The increase in the allowance for loan losses was primarily related to the items discussed above for the quarter. At the indicated dates the Company's risk elements and non-performing assets were (in thousands): June 30, December 31, 1998 1997 ------ ----------- Nonaccrual: Tax certificates .................... $ 930 $ 880 Loans and leases .................... 18,087 17,569 ------ ----------- Total nonaccrual .................... 19,017 18,449 ------ ----------- Repossessed Assets: Real estate owned, net of allowance .. 5,775 7,528 Repossessed assets ................... 2,090 2,912 ------ ----------- Total repossessed assets ............. 7,865 10,440 ------ ----------- Contractually past due 90 days or more (1) 3,516 647 ------ ----------- Total non-performing assets .......... 30,398 29,536 Restructured loans ....................... 14 4,043 ------ ----------- Total risk elements .................. $30,412 $ 33,579 ====== =========== (1) The majority of these loans have matured and the borrower continues to make payments under the matured loan agreement. BankAtlantic is in the process of renewing or extending these matured loans. Total risk elements at June 30, 1998 compared to December 31, 1997 decreased by $3.2 million. The decrease in risk elements primarily relates to a $4.0 million decline in restructured loans, partially offset by a $862,000 increase in nonperforming assets. The increase in nonperforming assets reflects LTI non-accrual leases and commercial loans contractually past due 90 days or more and LTI nonaccrual leases in 1998. During the six months ended June 30, 1998 a $1.1 million commercial mortgage loan was transferred from restructured loans to loans contractually past due 90 days or more and a $2.9 million commercial real estate loan was transferred out of restructured loans. Included in nonaccrual loans and leases at June 30, 1998 were $766,000 of LTI leases compared to zero at December 31, 1997. The above increases in nonperforming assets at June 30, 1998 were significantly offset by lower consumer and residential non-accrual balances. The change in repossessed assets includes $327,000 of equipment and vehicles acquired in connection with the LTI acquisition net of a decline in residential and consumer repossessed assets of $1.5 million and $1.1 million, respectively. NON-INTEREST INCOME
For the Three Months Ended For the Six Months Ended June 30, June 30, -------------------------- -------------------------- (In thousands) 1998 1997 Change 1998 1997 Change ------ ------ ------ ------ ------ ------ Loan servicing and other loan fees .......................... $ 906 $ 1,405 $ (499) $ 1,398 $ 2,976 $(1,578) Gains on sales of loans available for sale .................. 1,104 714 390 2,832 1,165 1,667 Gains on sales of mortgage servicing rights ................. 362 2,201 (1,839) 2,400 4,634 (2,234) Unrealized and realized gains (losses) on trading securities. 532 0 532 703 0 703 Gains on sales of securities available for sale ............. 473 689 (216) 2,193 942 1,251 Real estate held for development and sale and joint venture activities, net ............................................ 3,954 0 3,954 3,003 0 3,003 Transaction accounts ........................................ 3,040 2,267 773 5,640 4,412 1,228 ATM fees .................................................... 1,590 1,351 239 2,887 2,665 222 Other ....................................................... 1,111 1,007 104 1,951 1,864 87 ------ ------ ------ ------ ------ ------ Total non-interest income ................................. $13,072 $ 9,634 $ 3,438 $23,007 $18,658 $ 4,349 ====== ====== ====== ====== ====== ======
The decrease in loan servicing and other loan fees during the three and six month period in 1998 compared to the corresponding 1997 periods resulted from a decline in loan servicing income, partially offset by an increase in late fee income and loan fees. Loan servicing income declined by $1.0 million and $2.4 million, respectively, due to accelerated amortization of mortgage servicing rights caused by mortgage prepayments during the periods. Late fee and other loan fee income increased from $980,000 and $1.8 million during the three and six months ended June 30, 1997 to $1.5 million and $2.7 million during the comparable 1998 periods primarily due to a larger loan portfolio. During the three and six months ended June 30, 1998, the Company sold $48.0 million and $141.9 million of loans held for sale for gains reported in the preceding table. During the three and six months ended June 30, 1998, the Company transferred $58.1 million and $108.5 million of purchased residential loans from the held for investment category to the loans held for sale category. As part of its normal operations the Company purchases bulk residential loans and continually evaluates the portfolio. These evaluations may result in transfers from the held for investment category to the held for sale category; however, such transfers would not normally exceed 10% of the average annual balance of the portfolio. During the three and six months ended June 30, 1997, the Company sold $30.0 million and $54.6 million of loans held for sale for gains reported in the preceding table. During the six months ended June 30, 1998, the Company sold $19.7 million of mortgage servicing rights for gains reported in the above table. These rights related to approximately $1.3 billion of loans serviced for others. Included in the gain was $362,000 of previously deferred revenues relating to mortgage servicing rights sold during prior periods. During the three and six months ended June 30, 1997, the Company sold $5.8 million and $11.1 million of mortgage servicing rights for gains as reported in the above table. These rights related to approximately $496.1 million and $1.0 billion of loans serviced for others during the respective three and six month periods ended June 30, 1997. During the six months ended June 30, 1998 and 1997, the Company sold the following securities held in the available for sale portfolio for gains as reported in the above table: (in thousands), at cost: l998 l997 ------- ------- 7 year balloon mortgage-backed securities .. $121,232 $ 0 5 year balloon mortgage-backed securities .. 27,151 0 REMIC ...................................... 0 5,992 Federal agency obligations ................. 0 7,597 FHLB Bonds ................................. 9,977 0 U.S. treasury notes ........................ 4,980 190,631 ------- ------- Total fixed rate securities .............. 163,340 204,220 ------- ------- Equity securities .......................... 120 0 ------- ------- 5-1 Adjustable rate mortgages .............. 121,447 0 3-1 Adjustable rate mortgages .............. 103,183 0 ------- ------- Total adjustable rate securities ........... 224,630 0 ------- ------- Total sales of securities available for sale $388,090 $204,220 ======== ======== During the three and six months ended June 30, 1998, the Company sold marketable equity trading securities for a $560,000 gain. The unrealized gains (losses) on trading securities for the three and six months ended June 30, 1998 was $(28,000) and $143,000, respectively. The increase in transaction account fees during the three and six months ended June 30, 1998 compared to the corresponding 1997 period resulted from higher checking account income reflecting increased balances held in transaction accounts. Average transaction account balances increased from $904.8 million during the six months ended June 30, 1997 to $977.4 million during the comparable 1998 period. The increase in ATM fee income during the second quarter of 1998 resulted from installations of ATM machines in Georgia Wal-Mart superstores as well as installations of ATM machines in gas stations and convenience stores primarily in South Florida. As a result of the above installations the number of ATM machines increased by 115 for the three months ended June 30, 1998. Management anticipates ATM fee income will continue to increase due to the expected installation of an additional 232 ATM machines during the remainder of 1998. Real estate held for development and sale and joint venture activities, net primarily represents the results of SLWHC operations. During the three and six months ended June 30, 1998 SLWHC recorded gains on sales of land of $5.2 million and $5.3 million and incurred $1.3 million and $2.3 million of operating expenses, respectively. Furthermore, included in interest expense was $218,000 of capitalized interest on investment in and advances to joint ventures during the three and six months ended June 30, 1998. NON-INTEREST EXPENSES
For the Three Months Ended For the Six Months Ended June 30, June 30, -------------------------- --------------------------- (In thousands) 1998 1997 Change 1998 1997 Change ------ ------ ------ ------ ------ ------ Employee compensation and benefits .... $12,014 $ 9,286 $ 2,728 $23,482 $18,833 $ 4,649 Occupancy and equipment ............... 5,426 4,245 1,181 10,554 9,037 1,517 Federal insurance premium ............. 258 345 (87) 520 553 (33) Advertising and promotion ............. 1,693 525 1,168 2,184 894 1,290 Foreclosed asset activity, net ........ 125 15 110 (44) 28 (72) Amortization of cost over fair value of net assets acquired .................. 701 627 74 1,360 1,254 106 Other ................................. 5,766 4,400 1,366 10,837 9,244 1,593 ------ ------ ------ ------ ------ ------ Total non-interest expenses .......... $25,983 $19,443 $ 6,540 $48,893 $39,843 $ 9,050 ====== ====== ====== ====== ====== ======
The increase in employee compensation and benefits during the three and six months ended June 30, 1998 compared to the 1997 period resulted from the expansion of BankAtlantic's branch network and the start-up of five new business units (small business lending, international banking, trade finance, commercial loan syndications, and capital markets), requiring the hiring of 100 employees including senior managers, support and branch personnel and the acquisition of LTI. As a result of these growth initiatives the number of full-time equivalent employees increased from 1,009 at June 30, 1997 to 1,153 at June 30, 1998. Occupancy and equipment expenses increased during the three months ended June 30, 1998 due to the expanded ATM and branch network and computer technology upgrades resulting in $404,000 of higher depreciation expense, a $226,000 increase in data processing expenses and $358,000 of additional rent expense. Depreciation, data processing and rent expenses increased by $618,000, $281,000 and $418,000, respectively, during the six months ended June 30, 1998 compared to the same 1997 period. The increase in advertising and promotion expenses during the three and six months ended June 30, 1998 compared to the same 1997 period resulted from the implementation of a new print and TV identity campaign as well as branch expansion promotions in Miami-Dade County, and the Tampa Bay markets. Advertising and promotion costs are expensed as incurred. The increase in the amortization of cost over fair value of net assets acquired for the three and six months ended June 30, 1998 related to the LTI acquisition. The increase in other expenses during the three months ended June 30, 1998 compared to the 1997 period resulted from increases in telephone, ATM and consulting expenses of $206,000, $238,000 and $392,000, respectively. Furthermore, tax certificate recoveries were $285,000 lower during the 1998 three month period compared to the same 1997 period. The higher telephone expense reflects additional costs associated with a larger organization. The ATM expense increase reflects the larger ATM network during 1998 compared to the 1997 period. The higher consulting fees resulted from the hiring of the consulting firm Alex Sheshunoff & Co. to provide an efficiency and profit improvement study which is expected to be completed by the end of the third quarter of 1998. During the six months ended June 30, 1998 compared to the 1997 period stationery, printing and supplies, telephone, postage, ATM, and consulting expenses increased by $182,000, $270,000, $118,000 and $607,000, respectively, primarily for the same reasons described above. Tax certificate recoveries were $172,000 lower during the 1998 six month period compared to the same 1997 period. FINANCIAL CONDITION The Company's total assets at June 30, 1998 were $3.8 billion compared to $3.1 billion at December 31, 1997. Loans receivable, net, loans available for sale, trading securities, investments in real estate held for development and joint ventures, net, FHLB stock, mortgage servicing rights, cost over fair value of net assets acquired and other assets increased by $590.7 million, $50.3 million, $29.4 million, $23.6 million, $19.8 million, $9.4 million, $31.6 million and $6.1 million, respectively, while securities available for sale declined by $93.9 million. The higher loans receivable balances resulted from the purchase of $1.0 billion of wholesale residential loans and $594.9 million of loan fundings, partially offset by $676.2 million of principal reductions on loans and $141.9 million of loan sales. Included in trading securities was $27.7 million of debt and equity securities acquired in connection with the RBCO acquisition. During the six months ended June 30, 1998, the Company through a wholly owned subsidiary invested or advanced $20.5 million in real estate joint ventures located in South Florida. The additional FHLB stock balances was due to higher FHLB advances. The higher mortgage servicing rights balances reflects $36.6 million of mortgage servicing rights acquired partially offset by the sale of $13.7 million of mortgage servicing rights and $7.6 million of amortization. The LTI and RBCO acquisitions increased cost over fair value of net assets acquired by $32.9 million partially offset by amortization of existing goodwill. The increase in other assets primarily resulted from the assets acquired in connection with the RBCO acquisition. The decline in securities available for sale balances resulted from the sale of $388.1 million of securities, and principal collected of $69.4 million, partially offset by the purchase of $365.4 million of securities available for sale. The Company sold securities primarily to fund residential loan purchases. The Company's total liabilities at June 30, 1998 were $3.5 billion compared to $2.9 billion at December 31, 1997. Deposits, FHLB advances, federal funds purchased, securities sold under agreements to repurchase, advances by borrowers for taxes and insurance and other liabilities increased by $48.9 million, $361.4 million, $11.1 million, $143.8 million, $42.1 million and $35.1 million, respectively. The deposit increase primarily came from the Miami-Dade and Palm Beach County market segment and the small business banking unit. The increase in other liabilities primarily resulted from liabilities acquired in connection with the RBCO acquisition and increased accrued interest payables. Proceeds from FHLB advances, securities sold under agreements to repurchase, deposit inflows and advances by borrowers for taxes and insurance, loan repayments, sales of financial assets, principal collected on securities available for sale and investment securities held to maturity were used to repay securities sold under agreements to repurchase, fund loan growth and loan purchases, deposit outflows and to purchase securities available for sale, trading securities, mortgage servicing rights, FHLB stock, tax certificates and to acquire outstanding shares of Class B common stock. MARKET RISK Market risk is the risk arising from changes in interest rates, foreign currency exchange rates, and commodity and equity prices. The Company maintains a portfolio of trading and available for sale securities which subjects the Company to equity pricing risks. The Company acquired $27.7 million of debt and equity trading securities in connection with the RBCO acquisition as well as securities sold not yet purchased. The debt obligations in RBCO's trading portfolio primarily consist of municipal obligations issued by the State of New Jersey or Municipalities within the State. Substantially all of the equity securities are instruments issued by banking and thrift institutions. The Company's primary market risk is interest rate risk. EQUITY PRICING RISK Presented below is an analysis of the Company's equity pricing risk at June 30, 1998. The following table measures changes in the fair value of the Company's trading, available for sale securities and securities sold not yet purchased at June 30, 1998 based on percentage changes in fair value. Percent Trading Available Securities Change In Securities for Sale Sold Not Yet Fair Value Fair Value Fair Value Purchased ---------- ---------- ---------- ------------ (Dollars in thousands) 20.00 % $ 41,352 $ 15,409 $ 4,001 10.00 % $ 37,906 $ 14,125 $ 3,667 0.00 % $ 34,460 $ 12,841 $ 3,334 (10.00)% $ 31,014 $ 11,557 $ 3,001 (20.00)% $ 27,568 $ 10,273 $ 2,667 INTEREST RATE RISK The majority of the Company's assets and liabilities are monetary in nature subjecting the Company to significant interest rate risk. The Company has developed a model using vendor software to quantify its interest rate risk. A sensitivity analysis was performed measuring the Company's potential gains and losses in net portfolio fair values of interest rate sensitive instruments at June 30, 1998 resulting from a change in interest rates. The model calculates the net potential gains and losses in net portfolio fair value by: (i) discounting cash flows from existing assets, liabilities and off-balance sheet contracts to determine fair values at June 30, 1998, and (ii) discounting the above expected cash flows based on instantaneous and parallel shifts in the yield curve to determine fair values at June 30, 1998,). The difference between the fair value calculated in (i) and (ii) is the potential gains and losses in net portfolio fair values. Management has made estimates of fair value discount rates that it believes to be reasonable, however, because there is no quoted market for many of these financial instruments, management has no basis to determine whether the fair value presented would be indicative of the value negotiated in an actual sale. BankAtlantic's fair value estimates do not consider the tax effect that would be associated with the disposition of the assets or liabilities at their fair value estimates. Presented below is an analysis of the Company's interest rate risk at June 30, 1998 as calculated utilizing the Company's model. The table measures changes in net portfolio value for instantaneous and parallel shifts in the yield curve in 100 basis point increments up or down. Changes Net Portfolio Dollar in Rate Value Amount Change ------- ------------- -------- (Dollars in thousands) +200 bp $ 302,912 $ (78,759) +100 bp $ 351,677 $ (27,955) 0 bp $ 377,463 $ 0 (100)bp $ 328,873 $ (46,242) (200)bp $ 259,070 $(113,532) Certain assumptions by the Company in assessing the interest rate risk were utilized in developing the model and preparing the preceding table. These assumptions relate to interest rates, loan prepayment rates, deposit decay rates, and market values of certain assets under various interest rate scenarios. It was also assumed that delinquency rates will not change as a result of changes in interest rates although there can be no assurance that this will be the case. Furthermore, even if interest rates change in the designated increments, there can be no assurance that the Company's assets and liabilities would perform as indicated in the table above. In addition, a change in U.S. Treasury rates in the designated amounts, accompanied by a change in the shape of the yield curve could cause significantly different changes to the fair values than indicated above. Furthermore, the result of the calculations in the preceding table are subject to significant deviations based upon actual future events, including anticipatory and reactive measures which the Company may take in the future. LIQUIDITY AND CAPITAL RESOURCES LTI is obligated on leases sold with full recourse by LTI to investors prior to the Company's acquisition. Under the terms of such agreements, LTI is subject to recourse for 100% of the remaining balance of the lease receivable sold upon a default by the lessees. At June 30, 1998, the amount of lease payments subject to such recourse provisions was approximately $11.8 million. A $279,000 estimated liability on leases sold with recourse is included in other liabilities in the Company's Statement of Financial Condition. BankAtlantic's primary sources of funds during the first six months of 1998 were from operations, principal collected on loans, securities available for sale and investment securities held to maturity, and sales of securities available for sale, FHLB advances, securities sold under agreements to repurchase, mortgage servicing rights sales, deposit inflows and advances from borrowers for taxes and insurance. These funds were primarily utilized to fund operating expenses, deposit outflows, loan purchases and fundings and to purchase FHLB stock, tax certificates, trading securities, mortgage servicing rights and securities available for sale and acquire Class B common stock. At June 30, 1998, BankAtlantic met all applicable liquidity and regulatory capital requirements. BankAtlantic's commitments to originate loans, purchase loans and purchase securities available for sale at June 30, 1998 were $135.1 million, $17.0 million and $123.6 million, respectively, compared to commitments to originate loans, purchase loans and purchase securities available for sale of $70.2 million, $90.9 million, and zero, respectively, at June 30, 1997. BankAtlantic expects to fund the 1998 loan commitments from loan and securities available for sale repayments. At June 30, 1998, loan commitments were 5.86% of net loans receivable. At the indicated date BankAtlantic's capital amounts and ratios were:
To be Well For Capital Capitalized Under Adequacy Prompt Corrective Actual Purposes Action Provisions --------------- ---------------- ----------------- Amount Ratio Amount Ratio Amount Ratio ------- ----- ------- ----- ------- ----- (In thousands) At June 30, 1998: Total risk-based capital $362,616 15.18% > $191,074 > 8.00 % > $238,842 > 10.00% = = = = Tier I risk-based capital $332,855 13.94% > $ 95,537 > 4.00 % > $143,305 > 6.00% = = = = Tangible capital ........ $332,855 9.27% > $ 53,857 > 1.50 % > $ 53,857 > 1.50% = = = = Core capital ............ $332,855 9.27% > $143,618 > 4.00 % > $179,522 > 5.00% = = = = At December 31, 1997: Total risk-based capital $355,930 18.64% > $152,785 > 8.00 % > $190,981 > 10.00% = = = = Tier I risk-based capital $332,010 17.38% > $ 76,392 > 4.00 % > $114,588 > 6.00% = = = = Tangible capital ........ $332,010 11.12% > $ 44,798 > 1.50 % > $ 44,798 > 1.50% = = = = Core capital ............ $332,010 11.12% > $ 89,595 > 3.00 % > $149,325 > 5.00% = = = =
Savings institutions are also subject to the provisions of the Federal Deposit Insurance Corporation Improvement Act of 1991 ("FDICIA"). Regulations implementing the prompt corrective action provisions of FDICIA define specific capital categories based on FDICIA's defined capital ratios, as discussed more fully in the Company's Annual Report on Form 10K for the year ended December 31, 1997. PART II - OTHER INFORMATION Item 1. Legal Proceedings As discussed in the Company's Annual Report on Form 10K for the year ended December 31, 1997, there is a legal action in New Jersey related to the Subject Portfolio. This action purports to be a class action on behalf of named and unnamed plaintiffs that may have obtained loans from dealers who subsequently sold the loans to financial institutions, including BankAtlantic. This action seeks, among other things, rescission of the loan agreements and damages. In November 1995, the trial court in this action entered an order dismissing the complaint against BankAtlantic; and Plaintiffs appealed this ruling. In January 1996, the Appellate Court reversed the trial court decision and remanded the case back to the trial court to determine whether the action could be maintained as a class action. The reversal was without prejudice to BankAtlantic's right to renew its summary judgment motion after the trial court made a determination as to plaintiffs ability to maintain the case as a class action. In December 1997, the trial court denied plaintiffs motion for class certification and in January 1998 granted BankAtlantic's summary judgment motion. The plaintiffs appealed this ruling to the Superior Court of New Jersey Appellate Division which, in March 1998, denied the plaintiffs motion to appeal. Plaintiff subsequently appealed to the Supreme Court of New Jersey which, on June 30, 1998, granted plaintiffs motion to appeal and remanded the matter to the Appellate Division to consider the class issue on its merits. The Appellate Division has not set a date for hearing of this matter. Exhibits and Reports on Form 8K Exhibit 11 Statement re: Computation of Per Share Earnings. 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 thereunto duly authorized. BANKATLANTIC BANCORP, INC. August 14, 1998 By: /s/Alan B. Levan - ---------------- ------------------------- Date Alan B. Levan Chief Executive Officer/ Chairman/President August 14, 1998 By: /s/Jasper R. Eanes - --------------- ------------------------ Date Jasper R. Eanes Executive Vice President/ Chief Financial Officer EXHIBIT 11 ========== EARNINGS PER SHARE The following reconciles the numerators and denominators of the basic and diluted earnings per share computations.
For the Three Months ended June 30, For the Three Months ended June 30, (In thousands, except per share 1998 1997 data and percentages) ----------------------------------- ------------------------------------ Class A Class B Total Class A Class B Total ---------- ---------- ------ ---------- ---------- ------ Basic Numerator Actual dividends declared .............. $ 719 $ 252 $ 971 $ 234 $ 310 $ 544 Basic allocated undistributed earnings . 3,825 1,595 5,420 4,065 2,212 6,277 ---------- ---------- ------ ---------- ---------- ------ Allocated basic net income available for common shareholders ............... $ 4,544 $ 1,847 $ 6,391 $ 4,299 $ 2,522 $ 6,821 ========== ========== ====== ========== ========== ====== Basic Denominator Weighted average shares outstanding .... 22,724,683 10,425,815 17,940,645 10,742,040 ========== ========== ========== ========== Allocation percentage .................. 70.57% 29.43% 64.75% 35.25% ========== ========== ========== ========== Basic earnings per share ............... $ 0.20 $ 0.18 $ 0.24 $ 0.23 ========== ========== ========== ========== Diluted Numerator Actual dividends declared .............. $ 719 $ 252 $ 971 $ 234 $ 310 $ 544 ---------- ---------- ------ ---------- ---------- ------ Basic allocated undistributed earnings . 3,825 1,595 5,420 4,065 2,212 6,277 Reallocation of basic undistributed earnings due to change in allocation percentage ............................ 466 (466) 0 428 (428) 0 ---------- ---------- ------ ---------- ---------- ------ Diluted allocated undistributed earnings 4,291 1,129 5,420 4,493 1,784 6,277 Interest expense on convertible debt ... 1,170 308 1,478 456 181 637 ---------- ---------- ------ ---------- ---------- ------ Allocated dilutive net income available to common shareholders ................ $ 6,180 $ 1,689 $ 7,869 $ 5,183 $ 2,275 $ 7,458 ========== ========== ====== ========== ========== ====== Diluted Denominator Basic weighted average shares outstanding ........................... 22,724,683 10,425,815 17,940,645 10,742,040 Convertible debentures ................. 15,973,042 0 8,748,316 0 Options ................................ 622,875 958,833 244,475 1,014,037 Warrants ............................... 0 0 0 10,963 ---------- ---------- ---------- ---------- Diluted weighted average shares outstanding .................... 39,320,600 11,384,648 26,933,436 11,767,040 ========== ========== ========== ========== Allocation percentage .................. 79.16% 20.84% 71.57% 28.43% ========== ========== ========== ========== Diluted earnings per share ............. $ 0.16 $ 0.15 $ 0.19 $ 0.19 ========== ========== ========== ==========
For the Six Months ended June 30, For the Six Months ended June 30, (In thousands, except per share 1998 1997 data and percentages) ----------------------------------- ------------------------------------ Class A Class B Total Class A Class B Total ---------- ---------- ------ ---------- ---------- ------ Basic Numerator Actual dividends declared ............... $ 1,318 $ 507 $ 1,825 $ 487 $ 623 $ 1,110 Basic allocated undistributed earnings .. 6,856 2,966 9,822 7,842 4,210 12,052 ---------- ---------- ------ ---------- ---------- ------ Allocated basic net income available for common shareholders ................ $ 8,174 $ 3,473 $11,647 $ 8,329 $ 4,833 $13,162 ========== ========== ====== =========== ========== ====== Basic Denominator Weighted average shares outstanding ..... 22,269,820 10,596,437 18,042,902 10,656,193 ========== ========== ========== ========== Allocation percentage ................... 69.80% 30.20% 65.07% 34.93% ========== ========== ========== ========== Basic earnings per share ................ $ 0.37 $ 0.33 $ 0.46 $ 0.45 ========== ========== ========== ========== Diluted Numerator Actual dividends declared ............... $ 1,318 $ 507 $ 1,825 $ 487 $ 623 $ 1,110 ---------- ---------- ------ ---------- ---------- ------ Basic allocated undistributed earnings .. 6,856 2,966 9,822 7,842 4,210 12,052 Reallocation of basic undistributed earnings due to change in allocation percentage ............................. 873 (873) 0 799 (799) 0 ---------- ---------- ------ ---------- ---------- ------ Diluted allocated undistributed earnings 7,729 2,093 9,822 8,641 3,411 12,052 Interest expense on convertible debt .... 2,373 643 3,016 911 360 1,271 ---------- ---------- ------ ---------- ---------- ------ Allocated dilutive net income available to common shareholders ................. $ 11,420 $ 3,243 $14,663 $ 10,039 $ 4,394 $14,433 ========== ========== ====== ========== ========== ====== Diluted Denominator Basic weighted average shares outstanding ............................ 22,269,820 10,596,437 18,042,902 10,656,193 Convertible debentures .................. 16,138,597 0 8,754,273 0 Options ................................. 631,411 1,034,397 210,686 1,060,731 Warrants ................................ 0 0 0 10,963 ---------- ---------- ---------- ----------- Diluted weighted average shares outstanding ..................... 39,039,828 11,630,834 27,007,861 11,727,887 ========== ========== ========== ========== Allocation percentage ................... 78.69% 21.31% 71.70% 28.30% ========== ========== ========== ========== Diluted earnings per share .............. $ 0.29 $ 0.28 $ 0.37 $ 0.37 ========== ========== ========== ==========
EX-27 2 FDS --
9 This schedule contains summary financial information extracted from the Consolidated Statement of Financial Condition at June 30, 1998 and the Consolidated Statement of Operations for the six months ended June 30, 1998 and is qualified in its entirety by reference to such financial statements. 921768 BankAtlantic Bancorp, Inc. 1,000 U.S. Dollars 6-MOS DEC-31-1998 JAN-01-1998 JUN-30-1998 1 87,280 0 0 34,460 513,550 64,559 64,559 2,713,793 30,600 3,756,571 1,812,631 216,089 157,489 1,315,111 0 0 367 254,884 3,756,571 103,006 21,827 0 124,833 33,117 73,102 51,731 6,778 2,896 48,893 19,067 19,067 0 0 11,647 0.37 0.29 7.89 18,087 3,516 14 0 28,450 7,072 1,768 30,600 30,100 500 0
EX-27 3 FINANCIAL DATA SCHEDULE
9 This schedule contains summary financial information extracted from the Consolidated Statement of Financial Condition at June 30, 1997 (Unaudited) and the Consolidated Statement of Operations for the six months ended June 30, 1997 (Unaudited) and is qualified in its entirety by reference to such financial statements. 1,000 U.S. Dollars 6-MOS Dec-31-1997 Jan-01-1997 JUN-30-1997 1 82,490 0 7,808 0 449,422 68,587 68,587 1,933,980 27,200 2,730,474 1,768,087 105,544 82,514 620,754 0 0 225 153,350 2,730,474 83,071 19,419 0 102,490 34,317 54,556 47,934 5,162 942 39,843 21,587 21,587 0 0 13,162 0.46 0.37 8.32 14,025 2,710 5,060 0 25,750 4,856 1,144 27,200 27,200 0 0
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