TowneBank Reports Second Quarter Earnings Results
Source: TowneBank
TowneBank Reports Second Quarter Earnings Results
SUFFOLK, Va., July 29, 2010 (GLOBE NEWSWIRE) -- Hampton Roads based TowneBank (Nasdaq:TOWN) reported net income of $6.88 million for the quarter ended June 30, 2010 representing a 8.72% increase over the $6.33 million earned in the comparative period of 2009. Earnings for the six month year to date period increased 15.30% to $14.91 million as compared to the $12.93 million earned in the same period last year.
For the second quarter, net income available to common shareholders increased 14.02% to $4.54 million after accretion and preferred dividend payments of $2.34 million. The bank's common dividend payments totaled $2.34 million or $0.08 per share. Fully diluted earnings of $0.16 per share were unchanged from the second quarter of 2009 due to the issuance of 3,874,684 new common shares since June 30, 2009.
Earnings performance was enhanced by a 23.66% increase in net interest income to $29.73 million, a sharp increase of $5.69 million over last year. The bank's net interest margin on a fully tax equivalent basis increased to 3.66%, up from 3.22% for the same period in 2009. This increase is largely reflective of the repricing of deposit liabilities along with continued loan growth.
Non-interest income, excluding gains on available for sale securities, increased 16.71% to $15.89 million. Insurance, mortgage and real estate revenues increased 39%, 12%, and 3% respectively for the period. The bank also recognized a gain on available for sale securities of $1.98 million for the quarter as compared to the $2.38 million recorded for the same period in 2009 as the bank continues to reposition the securities portfolio and shorten the portfolio duration.
"Considering the current operating environment, we are particularly pleased with the continued growth of our core revenue," said G. Robert Aston, Jr., Chairman and Chief Executive Officer. "Excluding securities gains, the bank's pre-tax, pre-provision revenue increased 21.1%, or $7.96 million, for the second quarter of 2010 and $1.65 million or 3.74% on a linked quarter basis."
Balance Sheet
Total bank assets reached $3.73 billion, an increase of $240.37 million over the second quarter 2009 reflecting a growth rate of 6.88%. Towne continued to reach out and meet the credit needs of the Hampton Roads community with loans outstanding increasing 7.81% or $193.76 million over last year in the same period. Total deposits climbed to $2.79 billion representing a 7.54% increase for the period.
Asset Quality
Asset quality remained favorable relative to our local, regional and national competitors during the quarter. Non-performing loans rose modestly by $5.39 million with total non-performing assets including OREO ending the quarter at 1.50% of total assets. OREO properties, in the process of sale, total $6.14 million consisting of 25 different residential properties and 2 commercial properties.
The bank's loan loss provision for the quarter was $7.33 million reflective of net loan losses of $5.81 million coupled with additional reserves covering loan growth and other portfolio changes. The bank's loan loss reserve at June 30, 2010 was 1.34% compared to 1.17% for the period ended June 30, 2009.
Subsequent Events
Subsequent to quarter end, on July 16, 2010 TowneBank announced the signing of a purchase and assumption agreement to acquire all of the deposit accounts totaling $173 million of The Bank of Currituck along with its six banking offices in Northeastern North Carolina including three banking offices on the Outer Banks.
The transaction also includes approximately $173 million in assets including approximately $96 million of performing loans. All non-performing loans, OREO, and selected other loans are being retained by The Bank of Currituck for liquidation.
"With this acquisition, it will enable Towne to offer full banking service to our media footprint stretching from Williamsburg to the Outer Banks," added G. Robert Aston, Jr., Chairman and Chief Executive Officer.
As one of Virginia's top community banks, TowneBank now operates 18 banking offices in Chesapeake, Hampton, Portsmouth, Newport News, Virginia Beach, Norfolk, Williamsburg and York County. Towne also offers a full range of financial services through its controlled divisions and subsidiaries that include Towne Investment Group, Towne Insurance Agency, TFA Benefits, TowneBank Mortgage, TowneBank Commercial Mortgage, Prudential Towne Realty, Towne 1031 Exchange, LLC, and Corolla Classic Vacations. Through its strategic partnership with William E. Wood and Associates, the bank also offers mortgage services in all of their offices in Hampton Roads and Northeastern North Carolina. Local decision-making is a hallmark of its hometown banking strategy that is delivered through the leadership of each group's President and Board of Directors. With total assets of $3.73 billion as of June 30, 2010, TowneBank is one of the largest banks headquartered in Virginia.
Cautionary Statement:
This release may contain forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. These statements may address issues that involve significant risks, uncertainties, estimates and assumptions made by management. Factors that may cause actual results to differ materially from those contemplated by such forward-looking statements include competitive pressures in the banking industry that may increase significantly, changes in the interest rate environment may reduce margins and/or the volumes and values of loans made or held as well as the value of other financial assets held, general economic conditions, either nationally or regionally, may be less favorable than expected, resulting in, among other things, a deterioration in credit quality and/or a reduced demand for credit or other services, changes in the legislative or regulatory environment, including changes in accounting standards, may adversely affect our businesses, costs or difficulties related to the integration of the business and the businesses we have acquired may be greater than expected, expected cost savings associated with pending or recently completed acquisitions may not be fully realized or realized within the expected time frame, our competitors may have greater financial resources and develop products that enable them to compete more successfully, changes in business conditions, changes in the securities market and changes in our local economy with regards to our market area and its heavy concentration of U.S. military bases and related personnel. We assume no obligation to update information contained in this release.
Selected Financial Highlights (unaudited)
TOWNEBANK
June 30, 2010
(dollars in thousands)
Three Months Ended June 30,
2010
2009
Increase/
(Decrease)
% Increase/
(Decrease)
Results of Operations:
Net interest income
$ 29,727
$ 24,039
$ 5,688
23.66%
Noninterest income
15,891
13,616
2,275
16.71%
Gain on available for sale securities
1,979
2,380
(401)
(16.85%)
Noninterest expenses
30,152
28,552
1,600
5.60%
Provision for loan losses
7,326
2,720
4,606
169.34%
Pretax Income
9,728
8,666
1,062
12.25%
Provision for income tax expense
2,849
2,339
510
21.80%
Net income attributable to TowneBank
6,879
6,327
552
8.72%
Preferred stock dividends and accretion
2,340
2,346
(6)
(0.26%)
Net income available to common shareholders
4,539
3,981
558
14.02%
Net income per common share - basic
0.16
0.16
--
--
Net income per common share - diluted
0.16
0.16
--
--
Period End Data:
Total assets
$ 3,732,744
$ 3,492,374
$ 240,370
6.88%
Total assets - tangible
3,634,797
3,409,282
225,515
6.61%
Earning assets (1)
3,389,733
3,237,346
152,387
4.71%
Loans (net of unearned income)
2,673,954
2,480,199
193,755
7.81%
Allowance for loan losses
35,898
29,012
6,886
23.74%
Goodwill and other intangibles
97,947
83,092
14,855
17.88%
Nonperforming assets
56,044
23,672
32,372
136.75%
Noninterest bearing deposits
671,861
585,396
86,465
14.77%
Interest bearing deposits
2,120,029
2,010,720
109,309
5.44%
Total deposits
2,791,890
2,596,116
195,774
7.54%
Total equity
495,072
429,118
65,954
15.37%
Total equity - tangible
397,125
346,026
51,099
14.77%
Common equity
355,961
291,396
64,565
22.16%
Common equity - tangible
258,014
208,304
49,710
23.86%
Book value per common share
12.33
11.66
0.67
5.75%
Book value per common share - tangible
8.94
8.34
0.60
7.19%
Daily Average Balances:
Total assets
$ 3,723,756
$ 3,366,733
$ 357,023
10.60%
Total assets - tangible
3,625,341
3,283,245
342,096
10.42%
Earning assets (1)
3,381,196
3,130,723
250,473
8.00%
Loans (net of unearned income), excluding nonaccrual loans
2,578,261
2,426,944
151,317
6.23%
Allowance for loan losses
34,347
28,909
5,438
18.81%
Goodwill and other intangibles
98,415
83,488
14,927
17.88%
Noninterest bearing deposits
638,349
552,618
85,731
15.51%
Interest bearing deposits
2,100,734
1,918,884
181,850
9.48%
Total deposits
2,739,083
2,471,502
267,581
10.83%
Total equity
486,795
430,304
56,491
13.13%
Total equity - tangible
388,380
346,816
41,564
11.98%
Common equity
348,010
292,595
55,415
18.94%
Common equity - tangible
249,594
209,107
40,487
19.36%
Key Ratios:
Return on average assets
0.74%
0.75%
(0.01%)
(1.33%)
Return on average assets - tangible
0.76%
0.77%
(0.01%)
(1.30%)
Return on average equity
5.67%
5.90%
(0.23%)
(3.90%)
Return on average equity - tangible
7.10%
7.32%
(0.22%)
(3.01%)
Return on average common equity
5.23%
5.46%
(0.23%)
(4.21%)
Return on average common equity - tangible
7.29%
7.64%
(0.35%)
(4.58%)
Net interest margin-fully tax equivalent (1)(2)
3.66%
3.22%
0.44%
13.66%
Net interest margin (1)
3.59%
3.14%
0.45%
14.33%
Average earning assets/total average assets
90.80%
92.99%
(2.19%)
(2.36%)
Average loans/average deposits
94.13%
98.20%
(4.07%)
(4.14%)
Average noninterest deposits/total average deposits
23.31%
22.36%
0.95%
4.25%
Allowance for loan losses/period end loans
1.34%
1.17%
0.17%
14.53%
Nonperforming assets to period end assets
1.50%
0.68%
0.82%
120.59%
Period end equity/period end total assets
13.26%
12.29%
0.97%
7.89%
Efficiency ratio
66.10%
75.83%
(9.73%)
(12.83%)
(1) Includes bank-owned life insurance
(2) Presented on a tax-equivalent basis
Selected Financial Highlights (unaudited)
TOWNEBANK
June 30, 2010
(dollars in thousands)
Six Months Ended June 30,
2010
2009
Increase/
(Decrease)
% Increase/
(Decrease)
Results of Operations:
Net interest income
$ 58,591
$ 45,889
$ 12,702
27.68%
Noninterest income
30,999
25,202
5,797
23.00%
Gain on available for sale securities
2,479
7,108
(4,629)
(65.12%)
Noninterest expenses
60,637
55,812
4,825
8.65%
Provision for loan losses
9,931
4,690
5,241
111.75%
Pretax Income
21,162
17,936
3,226
17.99%
Provision for income tax expense
6,255
5,007
1,248
24.93%
Net income attributable to TowneBank
14,907
12,929
1,978
15.30%
Preferred stock dividends and accretion
4,681
5,362
(681)
(12.70%)
Net income available to common shareholders
10,226
7,567
2,659
35.14%
Net income per common share - basic
0.37
0.31
0.06
19.35%
Net income per common share - diluted
0.36
0.30
0.06
20.00%
Period End Data:
Total assets
$ 3,732,744
$ 3,492,374
$ 240,370
6.88%
Total assets - tangible
3,634,797
3,409,282
225,515
6.61%
Earning assets (1)
3,389,733
3,237,346
152,387
4.71%
Loans (net of unearned income)
2,673,954
2,480,199
193,755
7.81%
Allowance for loan losses
35,898
29,012
6,886
23.74%
Goodwill and other intangibles
97,947
83,092
14,855
17.88%
Nonperforming assets
56,044
23,672
32,372
136.75%
Noninterest bearing deposits
671,861
585,396
86,465
14.77%
Interest bearing deposits
2,120,029
2,010,720
109,309
5.44%
Total deposits
2,791,890
2,596,116
195,774
7.54%
Total equity
495,072
429,118
65,954
15.37%
Total equity - tangible
397,125
346,026
51,099
14.77%
Common equity
355,961
291,396
64,565
22.16%
Common equity - tangible
258,014
208,304
49,710
23.86%
Book value per common share
12.33
11.66
0.67
5.75%
Book value per common share - tangible
8.94
8.34
0.60
7.19%
Daily Average Balances:
Total assets
$ 3,686,830
$ 3,291,906
$ 394,924
12.00%
Total assets - tangible
3,587,883
3,211,644
376,239
11.71%
Earning assets (1)
3,356,008
3,074,254
281,754
9.16%
Loans (net of unearned income), excluding nonaccrual loans
2,557,474
2,401,740
155,734
6.48%
Allowance for loan losses
34,175
28,204
5,971
21.17%
Goodwill and other intangibles
98,947
80,262
18,685
23.28%
Noninterest bearing deposits
609,388
523,329
86,059
16.44%
Interest bearing deposits
2,067,605
1,875,243
192,362
10.26%
Total deposits
2,676,993
2,398,572
278,421
11.61%
Total equity
479,034
426,212
52,822
12.39%
Total equity - tangible
380,087
345,950
34,137
9.87%
Common equity
340,374
291,621
48,753
16.72%
Common equity - tangible
241,427
211,359
30,068
14.23%
Key Ratios:
Return on average assets
0.82%
0.79%
0.03%
3.80%
Return on average assets - tangible
0.84%
0.81%
0.03%
3.70%
Return on average equity
6.28%
6.12%
0.16%
2.61%
Return on average equity - tangible
7.91%
7.54%
0.37%
4.91%
Return on average common equity
6.06%
5.23%
0.83%
15.87%
Return on average common equity - tangible
8.54%
7.22%
1.32%
18.28%
Net interest margin-fully tax equivalent (1)(2)
3.65%
3.15%
0.50%
15.87%
Net interest margin (1)
3.58%
3.07%
0.51%
16.61%
Average earning assets/total average assets
91.03%
93.39%
(2.36%)
(2.53%)
Average loans/average deposits
95.54%
100.13%
(4.59%)
(4.58%)
Average noninterest deposits/total average deposits
22.76%
21.82%
0.94%
4.31%
Allowance for loan losses/period end loans
1.34%
1.17%
0.17%
14.53%
Nonperforming assets to period end assets
1.50%
0.68%
0.82%
120.59%
Period end equity/period end total assets
13.26%
12.29%
0.97%
7.89%
Efficiency ratio
67.68%
78.51%
(10.83%)
(13.79%)
(1) Includes bank-owned life insurance
(2) Presented on a tax-equivalent basis
CONTACT: TowneBank
G. Robert Aston, Chairman and CEO
757-638-6780
Clyde E. McFarland, Jr., Senior Executive Vice President
and CFO
757-638-6801
|
|
New!
Stock Market Forums (US, Europe, Asia)
Free Membership
|
|
|
| Latest USA Stock Market Reports |
US stock market daily report (September 01, 2010, Wednesday)
Stocks rallied in the first trading session in September, with the Dow being up triple digits. Thanks to a better than expected report on manufacturing, all three major indexes were on the rise. Typically in September, stocks post losses for the month. Investors say that maybe this year's September was in August. Stocks took a big hit in August; all three major indexes reported pretty significant losses. Coming in first was the Nasdaq; the index lost 6.2% in August, the Standard & Poor's 500 index is down 4.7% and the Dow Jones Industrial Average lost 4.3%. Recently when economic reports are released and they are better than expected stocks rise. Investors are looking for any positive news on the economy. They have feared throughout the summer that the economic recovery is headed towards a stand still. Analysts believe that the market will more than likely continue to fall overall. Despite the weary report from ADP stocks continued to rise. ADP is a payroll processing firm whose report is used as a way to tell what kind of report we will get from the Labor Department in their weekly report on the job market. ADP reported that employers cut 10,000 jobs in August, down from the 37,000 jobs added in July.
US stock market daily report ( August 31, 2010, Tuesday)
It was reported today that the amount of U.S. Banks in trouble is at a high that hasn't been seen since 1993. In a government report, the number of banks that have a possibility of filing doubled since last year. In the Federal Deposit Insurance Corp's quarterly survey, it showed an increase by 53 banks, taking the overall number to 829 banks being watched to fail. Just because the FDIC is watching these banks doesn't necessarily mean the financial institution will fail, it is just struggling. Few banks on the list actually get to that point; only 13% of banks on the list close. Last year the FDIC list reached 416, but in the first quarter of 2010 it rose to 775. In the report, it showed that 118 financial institutions have closed this year, and 45 of them were closed just in the second quarter.
US stock market daily report (August 30, 2010, Monday)
Today's stock market news wasn't the news investors were looking for to continue the rallies of Friday. Investors remained cautious in the first trading day of the week; stocks were headed lower after a positive report on consumer spending. This morning the Commerce Department reported that consumer spending rose 0.4% in July, up from the 0.1% it rose in June. Analysts' were looking for spending to rise by 0.2%, so were pleasantly surprised. Personal incomes rose in July; there was a rise by 0.2%, unchanged from the previous month. Analysts' were expecting to see spending rise by 0.3%. Analysts' say without a steady rise in personal income that the rise in consumer spending will only be temporarily
| |
|
|
| USA Stocks Recommendations |
Intel Corp. (Nasdaq:INTC) is poised to top estimates over the next two quarters, 8 September 2009
Intel Corp. (Nasdaq: INTC) is a cyclical company. That is, its stock does extremely well when the economy is ready to accelerate, and does poorly when the economy decelerates. So it’s no wonder that last year the stock fell more than 50% from the record-high of $27.78 a share it reached December 2007. However, the company has rallied more than 50% from its Feb. 23 low of $12.08 a share. It closed Friday at $19.64.
Verint Systems price target reduced, 7 December 2007
RBC Capital Markets reduced its price target on Verint Systems from $34 to $25.
Thomas Weisel upgraded Intel to "overweight", 6 December 2007
Thomas Weisel Partners analyst Kevin Cassidy lifted price target on Intel shares from $28 to $33 per share, citing an expected jump in computer demand during 2008.
| | USA News |
Factories Are Humming Along, Albeit Not at a Robust Pace, 2 September 2010
Tax Rates, Business Investment, Personal Saving Rates: We Report, You Decide, 1 September 2010
Nitty Gritty Details of the Labor Market Make Headlines, 31 August 2010
Bernanke Presents Fed’s Options and Indicates Deflation Not a Significant Risk, 30 August 2010
Bernanke’s Speech on August 27 – What to Look For, 27 August 2010
|
|
