2009 Third Quarter Highlights and Other Significant Events * Successfully Raised $101.6 Million in Capital Through the Sale of 9.3 Million Common Shares Including Underwriters' Over- Allotment. * Earnings Increased $0.13 Per Diluted Common Share, or 65%, from linked Quarter at $0.33 Per Diluted Common Share. * Core EPS Up $0.01 Per Diluted Common Share From Linked Quarter at $0.28 Per Diluted Common Share. * Net Interest Income for the 3rd Quarter Grew to $29.1 Million; a Record Level. * Net Interest Margin Increased to 3.00%. * Loans, Net Grew $75.0 Million, or 2.4%, for the Quarter. * Net Charge-Offs for the 3rd Quarter Were 0.11% of Average Loans. * $5.0 Million Provision Recorded for Loan Losses in Quarter. * Regulatory Capital Ratios at September 30, 2009 Were 8.55% for Core Capital and 12.97% for Risk-Weighted Capital. * Book Value Per Common Share Increased to $11.51. * Tangible Common Equity to Tangible Assets Increased to 7.93% at September 30, 2009.
LAKE SUCCESS, N.Y., Oct. 20, 2009 (GLOBE NEWSWIRE) -- Flushing Financial Corporation (The "Company") (Nasdaq:FFIC), the parent holding company for Flushing Savings Bank, FSB (the "Bank"), today announced its financial results for the three and nine months ended September 30, 2009.
John R. Buran, President and Chief Executive Officer, stated: "We are pleased to report another quarter of strong core earnings. Core diluted earnings per common share for the third quarter of 2009 increased $0.01, or 3.7%, to $0.28 per diluted common share from $0.27 per diluted common share for the second quarter of 2009. Our strong operating performance for the third quarter of 2009 was again driven by net interest income that grew to a record level of $29.1 million for the quarter, as the net interest margin increased two basis points to 3.00% from 2.98% for the second quarter of 2009.
"The growth in net interest income was driven by continued growth in our loan portfolio and deposit base, as both loans and deposits grew to record levels at September 30, 2009. We have focused on growing lower-costing core deposits to reduce our overall funding costs. During the first nine months of 2009, lower-costing core deposits increased $247.5 million, while higher-costing certificates of deposit and borrowed funds decreased $18.3 million and $112.0 million, respectively. This increase in core deposits more than funded our loan growth of $198.9 million, and helped reduce our funding costs, which declined 10 basis points to 3.10% for the third quarter of 2009 from 3.20% for the second quarter of 2009, and declined 75 basis points from 3.85% for the fourth quarter of 2008. Our expanded capabilities and product offerings established in the last three years helped to not only reduce our funding costs but also to grow transaction account balances by 35% for the first nine months of 2009, bringing the balances to $451.7 million at September 30, 2009.
"Non-performing loans increased $4.8 million during September to $81.4 million from $76.6 million we previously reported for August 31. The majority of non-performing loans are collateralized by residential income producing properties that are occupied. As a result they have retained more of their value, and provided us with low loss content in our non-performing loans during the quarter. Net loan charge-offs during the third quarter of 2009 were 11 basis points of average loans -- a reduction from the second quarter's exceptional bump up to 77 basis points. We recorded a $5.0 million provision for loan losses for the third quarter, bringing our allowance up to 59 basis points of total loans. Our growth in net interest income has more than offset the additional provision for loan losses as net interest income after the provision for loan losses increased $4.9 million, or 25.8%, to $24.1 million for the third quarter of 2009 as compared to the third quarter of 2008.
"During the third quarter we completed the sale of 8.3 million shares of our common stock through a public offering at a price of $11.50 per share. The net proceeds received increased our capital by $90.5 million for the third quarter of 2009, and increased our ratio of tangible common equity to tangible assets to 7.93% at September 30, 2009. We received strong institutional and retail demand for our stock, and on October 1, 2009 issued an additional 1.0 million common shares to cover underwriters' over-allotments. Total net proceeds received from the public offering, including over-allotments and deducting underwriting discounts and offering expenses, was $101.6 million. We intend to use part of this additional capital to repurchase the $70 million of preferred stock and the Warrant issued to the U.S. Treasury under the TARP Capital Purchase Program. The additional capital also places us in a strong position to take advantage of growth opportunities in our market.
"Stockholders' equity also increased during the third quarter due to an increase in the market value of our securities portfolio classified as available for sale. While this portfolio's value remains below our cost, the market value improved, net of tax, by $8.8 million during the third quarter, thereby increasing stockholders' equity.
"While we remain cautious about the economy, we recognize that we have the capital, liquidity, and the credit discipline to pick up market share in this huge New York Metropolitan market. The additional capital raised in our recent capital offering combined with the increased capabilities put in place during the last three years to gather significant core deposits and offer a broader array of banking services to business customers will enable us to more effectively compete with the larger competitors who continue to deal with challenges of weakened profitability and organizational disruption.
"The Bank continues to be well-capitalized under regulatory requirements, with tangible and risk-weighted capital ratios of 8.55% and 12.97%, respectively, at September 30, 2009."
Net income for the quarter ended September 30, 2009 was $8.1 million, an increase of $6.0 million from the $2.1 million earned in the third quarter of 2008. Diluted earnings per common share for the third quarter were $0.33, an increase of $0.23 from the $0.10 earned in the comparable quarter a year ago.
Net income for the nine months ended September 30, 2009 was $19.6 million, an increase of $3.8 million, or 24.1%, from the $15.8 million earned in the comparable 2008 period. Diluted earnings per common share for the nine months ended September 30, 2009 were $0.80, an increase of $0.02, or 2.6%, from the $0.78 earned in the comparable 2008 period.
Core earnings, which exclude the effects of financial assets and financial liabilities carried at fair value and certain non-recurring items, was $7.0 million, or $0.28 per diluted common share, an increase of $0.5 million, or $0.01 per diluted common share, from the second quarter of 2009, and an increase of $1.9 million, or $0.03 per diluted common share, from the $5.1 million, or $0.25 per diluted common share, for the third quarter of 2008. Core earnings during the nine months ended September 30, 2009 and 2008 was $18.5 million. Core earnings per diluted common share during the nine months ended September 30, 2009 was $0.75, a decrease of $0.16 per diluted common share from the $0.91 per diluted common share earned during the nine months ended September 30, 2008. For a reconciliation of core earnings and core earnings per common share to accounting principles generally accepted in the United States ("GAAP") net income and GAAP earnings per common share, please refer to the tables in the section titled Reconciliation of GAAP and Core Earnings.
Earnings Summary - Three Months Ended September 30, 2009
For the three months ended September 30, 2009, net interest income was $29.1 million, an increase of $6.9 million, or 31.4%, from $22.1 million for the three months ended September 30, 2008. The increase in net interest income is attributed to an increase in the average balance of interest-earning assets of $472.5 million, to $3,882.0 million for the quarter ended September 30, 2009, combined with an increase in the net interest spread of 36 basis points to 2.80% for the quarter ended September 30, 2009 from 2.44% for the comparable period in 2008. The yield on interest-earning assets decreased 46 basis points to 5.90% for the three months ended September 30, 2009 from 6.36% in the three months ended September 30, 2008. However, this was more than offset by a decline in the cost of funds of 82 basis points to 3.10% for the three months ended September 30, 2009 from 3.92% for the comparable prior year period. The net interest margin improved 40 basis points to 3.00% for the three months ended September 30, 2009 from 2.60% for the three months ended September 30, 2008. Excluding prepayment penalty income, the net interest margin would have been 2.97% and 2.48% for the three month periods ended September 30, 2009 and 2008, respectively.
The decline in the yield of interest-earning assets was primarily due to a 41 basis point reduction in the yield of the loan portfolio combined with a $210.7 million increase in the average balance of the lower yielding securities portfolio, which has a lower yield than the average yield of total interest-earning assets. The 41 basis point reduction in the yield of the loan portfolio to 6.22% for the quarter ended September 30, 2009 from 6.63% for the quarter ended September 30, 2008 was primarily due to a decline in prepayment penalty income, adjustable rate loans adjusting down as rates have declined, and an increase in non-accrual loans for which we do not accrue interest income. The yield on the mortgage loan portfolio declined 36 basis points to 6.28% for the three months ended September 30, 2009 from 6.64% for the three months ended September 30, 2008. The yield on the mortgage loan portfolio, excluding prepayment penalty income, declined 26 basis points to 6.24% for the three months ended September 30, 2009 from 6.50% for the three months ended September 30, 2008. The decline in the yield of interest-earning assets was partially offset by an increase of $240.1 million in the average balance of the loan portfolio to $3,120.5 million for the three months ended September 30, 2009.
The decrease in the cost of interest-bearing liabilities is primarily attributable to the Federal Open Market Committee ("FOMC") lowering the overnight interest rate throughout 2008, and maintaining the targeted Fed Funds rate in a range of 0.00% to 0.25% during 2009. This has allowed the Bank to reduce the rates it pays on its deposit products. The cost of certificates of deposit, money market accounts, savings accounts and NOW accounts decreased 83 basis points, 158 basis points, 82 basis points and 109 basis points respectively, for the quarter ended September 30, 2009 compared to the same period in 2008. The cost of due to depositors was also reduced due to the Bank's focus on increasing lower-costing core deposits. The combined average balances of lower-costing savings, money market and NOW accounts increased a total of $315.6 million for the quarter ended September 30, 2009 compared to the same period in 2008, while the average balance of higher-costing certificates of deposits increased $116.4 million for the quarter ended September 30, 2009 compared to the comparable period in 2008. This resulted in a decrease in the cost of due to depositors of 106 basis points to 2.50% for the quarter ended September 30, 2009 from 3.56% for the quarter ended September 30, 2008. The increase in deposits allowed the Bank to reduce its reliance on borrowed funds, as the average balance of borrowed funds declined $70.8 million to $1,042.0 million for the quarter ended September 30, 2009 from $1,112.8 million for the quarter ended September 30, 2008, with the cost of borrowed funds decreasing five basis points to 4.66% for the quarter ended September 30, 2009 from 4.71% for the quarter ended September 30, 2008.
The net interest margin for the three months ended September 30, 2009 increased two basis points to 3.00% from 2.98% for the quarter ended June 30, 2009. The net interest spread was unchanged at 2.80% for the three months ended September 30, 2009 from the quarter ended June 30, 2009 with both the yield on interest-earning assets and the cost of interest-bearing liabilities decreasing 10 basis points during the quarter. Excluding prepayment penalty income, the net interest margin would have been 2.97% for the quarter ended September 30, 2009, an increase of three basis points from 2.94% for the quarter ended June 30, 2009.
A provision for loan losses of $5.0 million was recorded for the quarter ended September 30, 2009 compared to $3.0 million recorded in the quarter ended September 30, 2008. The provision for loan losses recorded for the three months ended September 30, 2009 was primarily due to an increase in non-performing loans. This increase in non-performing loans primarily consists of mortgage loans collateralized by residential income producing properties located in the New York City metropolitan market. Prior to 2009, the Bank had recorded minimal losses on mortgage loans. The Bank continues to maintain conservative underwriting standards that include, among other things, a loan to value ratio of 75% or less and a debt coverage ratio of at least 125%. However, given the increase in non-performing loans, the current economic uncertainties, management, as a result of the regular quarterly analysis of the allowance for loans losses, deemed it necessary to record an additional provision for possible loan losses in the third quarter of 2009.
Non-interest income for the three months ended September 30, 2009 was $4.6 million, an increase of $7.2 million from the three months ended September 30, 2008. The net gain recorded from financial assets and financial liabilities carried at fair value decreased $19.6 million to a net gain of $1.0 million for the three months ended September 30, 2009 compared to a net gain of $20.6 million for the three months ended September 30, 2008. The three months ended September 30, 2008 included a $26.3 million other-than-temporary impairment charge on the Company's investments in Freddie Mac and Fannie Mae preferred stocks.
Non-interest expense was $15.3 million for the three months ended September 30, 2009, an increase of $1.7 million, or 12.6%, from $13.6 million for the three months ended September 30, 2008. Employee salary and benefits increased $0.6 million, which is primarily attributed to the growth of the Bank, including one new branch and the expansion of the collections department, and increased costs for postretirement benefits. Federal Deposit Insurance Corporation ("FDIC") insurance increased $0.8 million compared to the comparable prior year period, as the FDIC raised the deposit insurance premiums during 2009. Other operating expense increased $0.4 million primarily due to an increase in foreclosure expense as non-performing loans have increased from the prior year period. The efficiency ratio was 48.5% and 54.7% for the three months ended, September 30, 2009 and 2008, respectively.
Net income for the three months ended September 30, 2009 was $8.1 million, an increase of $6.0 million, as compared to $2.1 million for the three months ended September 30, 2008. Diluted earnings per common share were $0.33 for the three months ended September 30, 2009, an increase of $0.23 from $0.10 for the three months ended September 30, 2008.
Return on average equity was 10.1% for the three months ended September 30, 2009 compared to 3.7% for the three months ended September 30, 2008. Return on average assets was 0.8% for the three months ended September 30, 2009 compared to 0.2% for the three months ended September 30, 2008.
Earnings Summary - Nine Months Ended September 30, 2009
For the nine months ended September 30, 2009, net interest income was $84.0 million, an increase of $19.1 million, or 29.4%, from $64.9 million for the nine months ended September 30, 2008. The increase in net interest income is attributed to an increase in the average balance of interest-earning assets of $555.7 million, to $3,867.2 million for the nine months ended September 30, 2009, combined with an increase in the net interest spread of 27 basis points to 2.71% for the nine months ended September 30, 2009 from 2.44% for the comparable period in 2008. The yield on interest-earning assets decreased 53 basis points to 5.95% for the nine months ended September 30, 2009 from 6.48% for the nine months ended September 30, 2008. However, this was more than offset by a decline in the cost of funds of 80 basis points to 3.24% for the nine months ended September 30, 2009 from 4.04% for the comparable prior year period. The net interest margin improved 29 basis points to 2.90% for the nine months ended September 30, 2009 from 2.61% for the nine months ended September 30, 2008. Excluding prepayment penalty income, the net interest margin would have been 2.86% and 2.50% for the nine month periods ended September 30, 2009 and 2008, respectively.
The decline in the yield of interest-earning assets was primarily due to a 42 basis point reduction in the yield of the loan portfolio combined with a $315.5 million increase in the combined average balances of the lower yielding securities portfolio and interest-earning deposits, with each having a lower yield than the average yield of total interest-earning assets. The 42 basis point reduction in the yield of the loan portfolio to 6.32% for the nine months ended September 30, 2009 from 6.74% for the nine months ended September 30, 2008 was primarily due to a decline in prepayment penalty income, adjustable rate loans adjusting down as rates have continued to decline, and an increase in non-accrual loans for which we do not accrue interest income. The yield on the mortgage loan portfolio declined 36 basis points to 6.38% for the nine months ended September 30, 2009 from 6.74% for the nine months ended September 30, 2008. The yield on the mortgage loan portfolio, excluding prepayment penalty income, declined 26 basis points to 6.34% for the nine months ended September 30, 2009 from 6.60% for the nine months ended September 30, 2008. The decline in the yield of interest-earning assets was partially offset by an increase of $240.1 million in the average balance of the loan portfolio to $3,053.2 million for the nine months ended September 30, 2009.
The decrease in the cost of interest-bearing liabilities is primarily attributed to the FOMC lowering the overnight interest rate throughout 2008, and maintaining the targeted Fed Funds rate in a range of 0.00% to 0.25% during the nine months ended September 30, 2009. This has allowed the Bank to reduce the rates it pays on its deposit products. The cost of certificates of deposit, money market accounts, savings accounts and NOW accounts decreased 88 basis points, 159 basis points, 77 basis points and 83 basis points respectively, for the nine months ended September 30, 2009 compared to the same period in 2008. The cost of due to depositors was also reduced due to the Bank's focus on increasing lower-costing core deposits. The combined average balances of lower-costing savings, money market and NOW accounts increased a total of $299.3 million for the nine months ended September 30, 2009 compared to the same period in 2008, while the average balance of higher-costing certificates of deposits increased $217.7 million for the nine months ended September 30, 2009 compared to the comparable period in 2008. This resulted in a decrease in the cost of due to depositors of 103 basis points to 2.71% for the nine months ended September 30, 2009 from 3.74% for the nine months ended September 30, 2008. The increase in deposits allowed the Bank to reduce its reliance on borrowed funds, as the average balance of borrowed funds declined $51.6 million to $1,057.9 million for the nine months ended September 30, 2009 from $1,109.5 million for the nine months ended September 30, 2008, with the cost of borrowed funds decreasing seven basis points to 4.63% for the nine months ended September 30, 2009 from 4.70% for the nine months ended September 30, 2008.
A provision for loan losses of $14.5 million was recorded for the nine months ended September 30, 2009 compared to $3.6 million recorded in the nine months ended September 30, 2008. The provision for loan losses recorded in 2009 was primarily due to an increase in both non-performing loans and the level of charge-offs recorded in 2009. This increase in non-performing loans primarily consists of mortgage loans collateralized by residential income producing properties that are located in the New York City metropolitan market. Prior to 2009, the Bank had recorded minimal losses on mortgage loans. The Bank continues to maintain conservative underwriting standards that include, among other things, a loan to value ratio of 75% or less and a debt coverage ratio of at least 125%. However, given the increase in non-performing loans, the current economic uncertainties, and the charge-offs recorded during 2009, management, as a result of the regular quarterly analysis of the allowance for loans losses, deemed it necessary to record an additional provision for possible loan losses in the nine months ended 2009.
Non-interest income increased $7.5 million for the nine months ended September 30, 2009 to $11.6 million, as compared to $4.1 million for the nine months ended September 30, 2008. The net gain recorded from financial assets and financial liabilities carried at fair value decreased $14.6 million to a net gain of $4.0 million for the nine months ended September 30, 2009 compared to a net gain of $18.6 million for the nine months ended September 30, 2008. The $14.6 million decline in fair value was more than offset by a $25.2 million decline in other-than-temporary impairment charges recorded in the nine month period ended September 30, 2009, as a $1.1 million other-than-temporary impairment charge was recorded on a collateralized mortgage obligation for the nine months ended September 30, 2009 as compared to a $26.3 million other-than-temporary impairment charge of the Company's investments in Freddie Mac and Fannie Mae preferred stocks recorded in the comparable period in 2008. The nine months ended September 30, 2008 also included income of $2.4 million representing a partial recovery of a loss sustained in 2002 on a WorldCom, Inc. senior note. This amount was received as a result of a class action litigation settlement.
Non-interest expense was $49.0 million for the nine months ended September 30, 2009, an increase of $7.9 million, or 19.2%, from $41.2 million for the nine months ended September 30, 2008. Employee salary and benefits increased $2.2 million, which is primarily attributed to the growth of the Bank, including one new branch and the expansion of the collections department, and increased costs for postretirement benefits. Occupancy and equipment, professional services, and data processing increased $0.1 million, $0.3 million and $0.3 million, respectively, primarily due to the growth of the Bank. Other operating expense increased $0.4 million primarily due to an increase in foreclosure expense as non-performing loans have increased from the prior year period. FDIC insurance increased $4.4 million compared to the comparable prior year period, as the FDIC raised the deposit insurance premiums during 2009, and a $2.0 million special assessment was levied during the three months ended June 30, 2009 by the FDIC to partially replenish the deposit insurance fund. The efficiency ratio was 53.4% and 55.7% for the nine month periods ended September 30, 2009 and 2008, respectively.
Net income for the nine months ended September 30, 2009 was $19.6 million, an increase of $3.8 million or 24.1%, as compared to $15.8 million for the nine months ended September 30, 2008. Diluted earnings per common share were $0.80 for the nine months ended September 30, 2009, an increase of $0.02, or 2.6%, from $0.78 in the nine months ended September 30, 2008.
Return on average equity was 8.4% for the nine months ended September 30, 2009 compared to 9.0% for the nine months ended September 30, 2008. Return on average assets was 0.6% for the nine months ended September 30, 2009 compared to 0.6% for the nine months ended September 30, 2008.
Balance Sheet Summary
At September 30, 2009, total assets were $4,176.8 million, an increase of $227.3 million, or 5.8%, from $3,949.5 million at December 31, 2008. Total loans, net increased $198.9 million, or 6.7%, during the nine months ended September 30, 2009 to $3,159.6 million from $2,960.7 million at December 31, 2008. Loan originations and purchases were $388.9 million for the nine months ended September 30, 2009, a decrease of $140.1 million from $529.0 million for the nine months ended September 30, 2008, as loan demand has declined due to the current economic environment. At September 30, 2009, loan applications in process totaled $183.6 million, compared to $274.1 million at September 30, 2008 and $185.4 million at December 31, 2008. The following table shows loan originations and purchases for the periods indicated.
For the three months For the nine months
ended September 30, ended September 30,
-------------------- --------------------
(In thousands) 2009 2008 2009 2008
----------------------------------------------------------------------
Multi-family residential $ 73,495 $ 42,098 $166,026 $118,067
Commercial real estate 20,880 29,881 69,525 122,792
One-to-four family - mixed
-use property 11,694 33,922 25,467 105,824
One-to-four family -
residential 17,749 15,229 39,978 109,074
Construction 5,404 6,801 15,420 24,909
Small Business
Administration 702 1,618 1,983 8,448
Taxi Medallion 4,256 875 42,418 4,031
Commercial business and
other loans 10,122 11,517 28,071 35,885
--------- --------- --------- ---------
Total $144,302 $141,941 $388,888 $529,030
========= ========= ========= =========
Loan purchases included in the table above totaled $32.6 million and $65.3 million for the nine months ended September 30, 2009 and 2008, respectively. Loan purchases for the three months ended September 30, 2009 totaled $0.5 million. There were no loan purchases for the three months ended September 30, 2008.
As the Bank continues to increase its loan portfolio, management continues to adhere to the Bank's conservative underwriting standards. Non-accrual loans and charge-offs from impaired loans have increased, primarily due to the current economic environment. The majority of the Bank's non-performing loans are collateralized by residential income producing properties that are occupied, thereby retaining more of their value and reducing the potential loss. The Bank takes a proactive approach to managing delinquent loans, including conducting site examinations and encouraging borrowers to meet with a Bank representative. The Bank has been developing short-term payment plans that enable certain borrowers to bring their loans current. The Bank reviews its delinquencies on a loan by loan basis and continually explores ways to help borrowers meet their obligations and return them back to current status. The Bank has increased staffing to handle delinquent loans by hiring people experienced in loan workouts. The Bank's non-performing assets were $82.8 million at September 30, 2009 an increase of $21.2 million from $61.5 million at June 30, 2009, and an increase of $42.1 million from $40.7 million at December 31, 2008. Total non-performing assets as a percentage of total assets were 1.98% at September 30, 2009 compared to 1.51% at June 30, 2009 and 1.03% as of December 31, 2008. The ratio of allowance for loan losses to total non-performing loans was 22% at September 30, 2009, compared to 24% at June 30, 2009 and 28% at December 31, 2008.
The following table shows non-performing assets at the periods indicated:
September 30, June 30, December 31,
(In thousands) 2009 2009 2008
----------------------------------------------------------------------
Loans 90 days or more past due
and still accruing:
Commercial real estate $ -- $ -- $ 425
One-to-four family - residential 2,308 1,935 889
Construction 850 -- --
----------- ----------- -----------
Total 3,158 1,935 1,314
----------- ----------- -----------
Troubled debt restructured:
Multi-family residential 480 -- --
Commercial real estate 1,445 -- --
One-to-four family - mixed-use
property 578 -- --
----------- ----------- -----------
Total 2,503 -- --
----------- ----------- -----------
Non-accrual loans:
Multi-family residential 24,963 20,490 12,010
Commercial real estate 18,002 9,180 7,409
One-to-four family - mixed-use
property 21,965 19,346 10,639
One-to-four family - residential 3,907 3,042 1,122
Construction 3,049 3,898 4,457
Small business administration 1,147 271 354
Commercial business and other 2,707 2,701 2,667
----------- ----------- -----------
Total 75,740 58,928 38,658
----------- ----------- -----------
Total non-performing loans 81,401 60,863 39,972
----------- ----------- -----------
Other non-performing assets:
Real estate acquired through
foreclosure 1,337 509 125
Investment securities 50 172 607
----------- ----------- -----------
Total 1,387 681 732
----------- ----------- -----------
Total non-performing
assets $ 82,788 $ 61,544 $ 40,704
=========== =========== ===========
During the nine months ended September 30, 2009, the Bank had $7.0 million in net charge-offs of impaired loans. The following table shows net loan charge-offs for the periods indicated by type of loan:
For the three months For the nine months
ended September 30, ended September 30,
-------------------- --------------------
(In thousands) 2009 2008 2009 2008
----------------------------------------------------------------------
Multi-family residential $ 212 $ 229 $ 1,744 $ 367
Commercial real estate 100 -- 116 --
One-to-four family -
mixed-use property 158 -- 864 --
One-to-four family -
residential 1 -- 56 --
Construction -- -- 407 --
Small Business
Administration 318 161 815 321
Commercial business and
other loans 60 -- 2,948 1
--------- --------- --------- ---------
Total $ 849 $ 390 $ 6,950 $ 689
========= ========= ========= =========
Net charge-offs include loans that were fully charged-off and impaired mortgage loans that were written down to 90% of the properties' estimated value. On a quarterly basis the property value of impaired mortgage loans are internally reviewed, based on updated cash flows for income producing properties, and at times an updated independent appraisal is obtained. The loan balance of impaired mortgage loans is then compared to the properties updated estimated value and any balance over 90% of the loans updated estimated value is charged-off. Impaired mortgage loans that were written down resulted from quarterly reviews or updated appraisals that indicated the properties' estimated value had declined from when the loan was originated.
During the nine months ended September 30, 2009, cash and due from banks increased $94.2 million to $124.6 million from $30.4 million at December 31, 2008. The increase is primarily due to $90.5 million received from the issuance of 8.3 million shares of Flushing Financial Corporation common stock through a public offering completed in September.
During the nine months ended September 30, 2009, mortgage-backed securities decreased $27.0 million to $647.7 million, while other securities decreased $33.2 million to $39.3 million. During the nine months ended September 30, 2009, there were purchases and sales of mortgage-backed securities of $119.2 million and $38.2 million, respectively. Other securities primarily consists of securities issued by government agencies and mutual or bond funds that invest in government and government agency securities.
Total liabilities were $3,760.1 million at September 30, 2009, an increase of $112.1 million, or 3.1%, from December 31, 2008. During the nine months ended September 30, 2009, due to depositors increased $229.2 million to $2,666.8 million, as a result of an increase of $247.5 million in core deposits and a decline of $18.3 million in certificates of deposit. Borrowed funds decreased $112.0 million as loan growth was more than funded by deposit growth.
Total stockholders' equity increased $115.2 million, or 38.2%, to $416.7 million at September 30, 2009 from $301.5 million at December 31, 2008. The increase is primarily due to $90.5 million in additional capital received from the issuance of 8.3 million shares of Flushing Financial Corporation common stock through a public offering completed in September. (On October 1, 2009, the underwriters' exercised their over-allotment, resulting in the issuance of an additional 1.0 million of shares of common stock being issued, with the Company receiving net proceeds of $11.1 million.) This was combined with net income of $19.6 million and an increase in other comprehensive income of $12.3 million for the nine months ended September 30, 2009. The increase in other comprehensive income was primarily attributed to an increase in the market value of securities held in the available for sale portfolio. These increases were partially offset by the declaration and payment of dividends on the Company's common stock and preferred stock of $8.1 million and $2.3 million, respectively. The exercise of stock options increased stockholders' equity by $0.6 million, including the income tax benefit realized by the Company upon the exercise of options. Book value per common share was $11.51 at September 30, 2009, compared to $10.70 at December 31, 2008 and $10.74 at September 30, 2008. Tangible book value per common share was $10.95 at September 30, 2009, compared to $9.92 at December 31, 2008 and $9.95 at September 30, 2008.
The Company did not repurchase any shares during the quarter ended September 30, 2009 under its current stock repurchase program. At September 30, 2009, 362,050 shares remain to be repurchased under the current stock repurchase program. As a condition of the Company's participation in the U.S. Treasury's Capital Purchase Program, common shares may not be purchased for three years from the date of the Company's participation without approval of the U.S. Treasury unless the preferred shares are redeemed or transferred to a third party. As of the date of the press release, the Company has not requested approval from the U.S. Treasury to repurchase common shares.
Reconciliation of GAAP and Core Earnings
Although core earnings are not a measure of performance calculated in accordance with GAAP, the Company believes that its core earnings are an important indication of performance through ongoing operations. The Company believes that core earnings are useful to management and investors in evaluating its ongoing operating performance, and in comparing its performance with other companies in the banking industry, particularly those that do not carry financial assets and financial liabilities at fair value. Core earnings should not be considered in isolation or as a substitute for GAAP earnings. During the periods presented the Company calculated core earnings by adding back or subtracting the net gain or loss recorded on financial assets and financial liabilities carried at fair value and the income or expense of certain non-recurring items listed below.
Three Months Ended Nine Months Ended
---------------------------- ------------------
Sept. 30, Sept. 30, June 30, Sept. 30, Sept. 30,
2009 2008 2009 2009 2008
---------------------------- ------------------
(In thousands, except per share data)
GAAP net income $ 8,110 $ 2,130 $ 5,162 $ 19,581 $ 15,780
Net gain from
financial assets
and financial
liabilities carried
at fair value, net
of tax (528) (11,452) (390) (2,222) (10,368)
Other-than-temporary
impairment charge,
net of tax -- 14,660 633 633 14,660
Net gain on sale of
securities,net of
tax (583) (197) (13) (596) (197)
FDIC special
assessment, net
of tax -- -- 1,114 1,114 --
Partial recovery of
WorldCom, Inc. loss,
net of tax -- 5 -- -- (1,347)
---------------------------- ------------------
Core net income $ 6,999 $ 5,146 $ 6,506 $ 18,510 $ 18,528
============================ ==================
GAAP diluted earnings
per common share $ 0.33 $ 0.10 $ 0.20 $ 0.80 $ 0.78
Net gain from
financial assets and
financial liabilities
carried at fair
value, net of tax (0.02) (0.56) (0.02) (0.11) (0.51)
Other-than-temporary
impairment charge,
net of tax -- 0.72 0.03 0.03 0.72
Net gain on sale of
securities,net of
tax (0.03) (0.01) -- (0.03) (0.01)
FDIC special
assessment, net
of tax -- -- 0.05 0.05 --
Partial recovery of
WorldCom, Inc. loss,
net of tax -- -- -- -- (0.07)
---------------------------- ------------------
Core diluted earnings
per common share* $ 0.28 $ 0.25 $ 0.27 $ 0.75 $ 0.91
============================ ==================
* Core diluted earnings per common share may not foot due to rounding.
About Flushing Financial Corporation
Flushing Financial Corporation is the parent holding company for Flushing Savings Bank, FSB, a federally chartered stock savings bank insured by the FDIC. The Bank serves consumers and businesses by offering a full complement of deposit, loan, and cash management services through its fifteen banking offices located in Queens, Brooklyn, Manhattan, and Nassau County. The Bank also operates an online banking division, iGObanking.com(R), which enables the Bank to expand outside of its current geographic footprint. In 2007, the Bank established Flushing Commercial Bank, a wholly-owned subsidiary, to provide banking services to public entities including counties, towns, villages, school districts, libraries, fire districts and the various courts throughout the metropolitan area.
Additional information on Flushing Financial Corporation may be obtained by visiting the Company's website at http://www.flushingsavings.com.
"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995: Statements in this Press Release relating to plans, strategies, economic performance and trends, projections of results of specific activities or investments and other statements that are not descriptions of historical facts may be forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking information is inherently subject to risks and uncertainties, and actual results could differ materially from those currently anticipated due to a number of factors, which include, but are not limited to, risk factors discussed in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2008 and in other documents filed by the Company with the Securities and Exchange Commission from time to time. Forward-looking statements may be identified by terms such as "may", "will", "should", "could", "expects", "plans", "intends", "anticipates", "believes", "estimates", "predicts", "forecasts", "potential" or "continue" or similar terms or the negative of these terms. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. The Company has no obligation to update these forward-looking statements.
FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(Dollars in Thousands Except Per Share Data)
(Unaudited)
Sept. 30, Dec. 31,
2009 2008
----------- -----------
ASSETS
------
Cash and due from banks $ 124,635 $ 30,404
Securities available for sale:
Mortgage-backed securities 647,747 674,764
Other securities 39,253 72,497
Loans:
Multi-family residential 1,125,022 999,185
Commercial real estate 792,675 752,120
One-to-four family -- mixed-use property 746,997 751,952
One-to-four family -- residential 244,850 238,711
Co-operative apartments 6,078 6,566
Construction 106,349 103,626
Small Business Administration 17,960 19,671
Taxi medallion 46,353 12,979
Commercial business and other 74,762 69,759
Net unamortized premiums and unearned
loan fees 17,085 17,121
Allowance for loan losses (18,578) (11,028)
----------- -----------
Net loans 3,159,553 2,960,662
Interest and dividends receivable 19,389 18,473
Bank premises and equipment, net 22,978 22,806
Federal Home Loan Bank of New York stock 44,461 47,665
Bank owned life insurance 59,361 57,499
Goodwill 16,127 16,127
Core deposit intangible 1,991 2,342
Other assets 41,301 46,232
----------- -----------
Total assets $ 4,176,796 $ 3,949,471
=========== ===========
LIABILITIES
-----------
Due to depositors:
Non-interest bearing $ 83,934 $ 69,624
Interest-bearing:
Certificate of deposit accounts 1,418,160 1,436,450
Savings accounts 445,673 359,595
Money market accounts 351,273 306,178
NOW accounts 367,778 265,762
----------- -----------
Total interest-bearing deposits 2,582,884 2,367,985
Mortgagors' escrow deposits 30,812 31,225
Borrowed funds 1,026,943 1,138,949
Other liabilities 35,515 40,196
----------- -----------
Total liabilities 3,760,088 3,647,979
----------- -----------
STOCKHOLDERS' EQUITY
--------------------
Preferred stock ($0.01 par value; 5,000,000
shares authorized; 70,000 shares issued at
September 30, 2009 and December 31, 2008;
liquidation preference value of $70,000) 1 1
Common stock ($0.01 par value; 40,000,000
shares authorized; 30,118,449 shares and
21,625,709 shares issued at September 30,
2009 and December 31, 2008, respectively;
30,114,154 shares and 21,625,709 shares
outstanding at September 30, 2009 and
December 31, 2008, respectively) 301 216
Additional paid-in capital 244,036 150,662
Treasury stock (4,295 and none at September
30, 2009 and December 31, 2008,
respectively) (46) --
Unearned compensation (755) (1,300)
Retained earnings 181,143 172,216
Accumulated other comprehensive loss, net
of taxes (7,972) (20,303)
----------- -----------
Total stockholders' equity 416,708 301,492
----------- -----------
Total liabilities and stockholders' equity $ 4,176,796 $ 3,949,471
=========== ===========
FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(Dollars in Thousands Except Per Share Data)
(Unaudited)
For the three months For the nine months
ended September 30, ended September 30,
--------------------- --------------------
2009 2008 2009 2008
---------------------------------------------------------------------
Interest and dividend
income
---------------------
Interest and fees on loans $ 48,518 $ 47,766 $ 144,745 $ 142,243
Interest and dividends on
securities:
Interest 8,365 5,916 26,674 15,952
Dividends 326 465 1,104 2,265
Other interest income 14 57 71 533
--------- --------- --------- ---------
Total interest and
dividend income 57,223 54,204 172,594 160,993
--------- --------- --------- ---------
Interest expense
----------------
Deposits 16,024 18,962 51,780 56,950
Other interest expense 12,127 13,112 36,765 39,105
--------- --------- --------- ---------
Total interest expense 28,151 32,074 88,545 96,055
--------- --------- --------- ---------
Net interest income 29,072 22,130 84,049 64,938
Provision for loan losses 5,000 3,000 14,500 3,600
--------- --------- --------- ---------
Net interest income after
provision for loan losses 24,072 19,130 69,549 61,338
--------- --------- --------- ---------
Non-interest income
-------------------
Loan fee income 403 655 1,333 2,051
Banking services fee
income 459 394 1,326 1,232
Net gain on sale of loans
held for sale -- 102 -- 133
Net gain on sale of loans -- (84) -- (15)
Net gain from sale of
securities 1,051 354 1,074 354
Net gain from financial
assets and financial
liabilities carried at
fair value 950 20,555 4,002 18,614
Other-than-temporary
impairment charge -- (26,320) (1,140) (26,320)
Federal Home Loan Bank of
New York stock dividends 644 729 1,600 2,464
Bank owned life insurance 659 563 1,862 1,666
Other income 391 390 1,541 3,872
--------- --------- --------- ---------
Total non-interest
income 4,557 (2,662) 11,598 4,051
--------- --------- --------- ---------
Non-interest expense
--------------------
Salaries and employee
benefits 7,159 6,518 22,026 19,799
Occupancy and equipment 1,669 1,708 5,067 4,929
Professional services 1,283 1,446 4,485 4,215
FDIC deposit insurance 1,186 429 5,383 995
Data processing 1,086 991 3,258 2,964
Depreciation and
amortization 675 613 1,979 1,804
Other operating expenses 2,275 1,910 6,849 6,450
--------- --------- --------- ---------
Total non-interest
expense 15,333 13,615 49,047 41,156
--------- --------- --------- ---------
Income before income taxes 13,296 2,853 32,100 24,233
--------- --------- --------- ---------
Provision for income taxes
--------------------------
Federal 4,400 847 8,698 6,942
State and local 786 (124) 3,821 1,511
--------- --------- --------- ---------
Total taxes 5,186 723 12,519 8,453
--------- --------- --------- ---------
Net income $ 8,110 $ 2,130 $ 19,581 $ 15,780
========= ========= ========= =========
Basic earnings per common
share $ 0.33 $ 0.10 $ 0.80 $ 0.78
Diluted earnings per
common share $ 0.33 $ 0.10 $ 0.80 $ 0.78
FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES
SELECTED CONSOLIDATED FINANCIAL DATA
(Dollars in Thousands Except Share Data)
(Unaudited)
At or for the At or for the
three months ended nine months ended
September 30, September 30,
----------------------- -----------------------
2009 2008 2009 2008
----------- ----------- ----------- -----------
Per Share Data
--------------
Basic earnings per
share $ 0.33 $ 0.10 $ 0.80 $ 0.78
Diluted earnings per
share $ 0.33 $ 0.10 $ 0.80 $ 0.78
Average number of
shares outstanding
for:
Basic earnings per
common share
computation (1) 21,518,559 20,324,682 20,945,586 20,152,276
Diluted earnings per
common share
computation (1) 21,533,686 20,486,003 20,954,055 20,337,096
Book value per common
share (2) $ 11.51 $ 10.74 $ 11.51 $ 10.74
Tangible book value
per common share (3) $ 10.95 $ 9.95 $ 10.95 $ 9.95
Average Balances
----------------
Total loans, net $ 3,120,549 $ 2,880,495 $ 3,053,244 $ 2,813,099
Total interest-
earning assets 3,881,981 3,409,436 3,867,164 3,311,489
Total assets 4,067,829 3,593,128 4,051,030 3,499,126
Total due to
depositors 2,560,778 2,128,843 2,526,049 2,029,124
Total interest-
bearing liabilities 3,635,219 3,272,910 3,639,582 3,172,719
Stockholders' equity 322,298 230,183 310,610 232,775
Common stockholders'
equity
252,298 230,183 240,610 232,775
Performance Ratios (4)
----------------------
Return on average
assets 0.80% 0.24% 0.64% 0.60%
Return on average
equity 10.07 3.70 8.41 9.04
Yield on average
interest-earning
assets 5.90 6.36 5.95 6.48
Cost of average
interest-bearing
liabilities 3.10 3.92 3.24 4.04
Interest rate spread
during period 2.80 2.44 2.71 2.44
Net interest margin 3.00 2.60 2.90 2.61
Non-interest expense
to average assets 1.51 1.52 1.61 1.57
Efficiency ratio (5) 48.45 54.72 53.43 55.67
Average interest-
earning assets to
average interest-
bearing liabilities 1.07X 1.04X 1.06X 1.04X
(1) Reflects the adoption of FASB ASC 260-10-45-60A, (formerly FSP
EITF 03-6-1 "Determining Whether Instruments Granted in Share-
Based Payment Transactions are Participating Securities"), which
has been applied retrospectively.
(2) Calculated by dividing common stockholders' equity of $346.7
million and $232.2 million at September 30, 2009 and 2008,
respectively, by 30,114,154 and 21,625,709 shares outstanding
at September 30, 2009 and 2008, respectively. Common
stockholders' equity is total stockholders' equity less the
liquidation preference value of preferred shares outstanding.
(3) Calculated by dividing tangible common stockholders' equity of
$329.9 million and $215.2 million at September 30, 2009 and
2008, respectively, by 30,114,154 and 21,625,709 shares
outstanding at September 30, 2009 and 2008, respectively.
Tangible common stockholders' equity is total stockholders'
equity less the liquidation preference value of preferred
shares outstanding and intangible assets (goodwill and core
deposit intangible, net of deferred taxes).
(4) Ratios for the three and nine month periods ended September 30,
2009 and 2008 are presented on an annualized basis.
(5) Calculated by dividing non-interest expense (excluding REO
expense) by the total of net interest income and non-interest
income (excluding gain on sale of securities, net gain from
financial assets and financial liabilities carried at fair
value, other-than-temporary impairment charges, and the
WorldCom, Inc. recovery).
FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES
SELECTED CONSOLIDATED FINANCIAL DATA
(Dollars in Thousands)
(Unaudited)
At or for the nine At or for the year
months ended ended
September 30, 2009 December 31, 2008
------------------ ------------------
Selected Financial Ratios
and Other Data
-------------------------
Regulatory capital ratios
(for Flushing Savings Bank
only):
Tangible capital (minimum
requirement = 1.5%) 8.55% 7.92%
Leverage and core capital
(minimum requirement = 3%) 8.55 7.92
Total risk-based capital
(minimum requirement = 8%) 12.97 13.02
Capital ratios:
Average equity to average
assets 7.67% 6.54%
Equity to total assets 9.98 7.63
Tangible common equity to
tangible assets 7.93 5.45
Asset quality:
Non-accrual loans $ 75,740 $ 38,658
Non-performing loans 81,401 39,972
Non-performing assets 82,788 40,704
Net charge-offs 6,950 1,205
Asset quality ratios:
Non-performing loans to
gross loans 2.58% 1.35%
Non-performing assets to
total assets 1.98 1.03
Allowance for loan losses
to gross loans 0.59 0.37
Allowance for loan losses
to non-performing assets 22.44 27.09
Allowance for loan losses
to non-performing loans 22.82 27.59
FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES
NET INTEREST MARGIN
(Dollars in Thousands)
(Unaudited)
For the three months ended September 30,
--------------------------------------------------------
2009 2008
--------------------------- ---------------------------
Average Yield/ Average Yield/
Balance Interest Cost Balance Interest Cost
--------------------------- ---------------------------
Assets
Interest-
earning
assets:
Mortgage
loans,
net (1) $2,982,356 $ 46,807 6.28% $2,785,271 $ 46,244 6.64%
Other
loans,
net (1) 138,193 1,711 4.95 95,224 1,522 6.39
--------------------------- ---------------------------
Total
loans,
net 3,120,549 48,518 6.22 2,880,495 47,766 6.63
--------------------------- ---------------------------
Mortgage-
backed
securities 680,740 8,160 4.79 420,062 5,487 5.22
Other
securities 46,038 531 4.61 96,000 894 3.73
--------------------------- ---------------------------
Total
secur-
ities 726,778 8,691 4.78 516,062 6,381 4.95
--------------------------- ---------------------------
Interest-
earning
deposits
and
federal
funds sold 34,654 14 0.16 12,879 57 1.77
--------------------------- ---------------------------
Total
interest-
earning
assets 3,881,981 57,223 5.90 3,409,436 54,204 6.36
---------------- ----------------
Other assets 185,848 183,692
---------- ----------
Total
assets $4,067,829 $3,593,128
========== ==========
Liabilities
and Equity
Interest-
bearing
liabilities:
Deposits:
Savings
accounts $ 443,928 1,386 1.25 $ 373,105 1,931 2.07
NOW
accounts 380,265 1,470 1.55 173,914 1,147 2.64
Money
market
accounts 341,258 1,247 1.46 302,878 2,303 3.04
Certificate
of
deposit
accounts 1,395,327 11,904 3.41 1,278,946 13,563 4.24
--------------------------- ---------------------------
Total due
to
deposit-
ors 2,560,778 16,007 2.50 2,128,843 18,944 3.56
Mortgagors'
escrow
accounts 32,454 17 0.21 31,236 18 0.23
--------------------------- ---------------------------
Total
deposits 2,593,232 16,024 2.47 2,160,079 18,962 3.51
Borrowed
funds 1,041,987 12,127 4.66 1,112,831 13,112 4.71
--------------------------- ---------------------------
Total
interest-
bearing
liabil-
ities 3,635,219 28,151 3.10 3,272,910 32,074 3.92
---------------- ----------------
Non interest
-bearing
deposits 81,803 69,407
Other
liabilities 28,509 20,628
---------- ----------
Total
liabil-
ities 3,745,531 3,362,945
Equity 322,298 230,183
---------- ----------
Total
liabil-
ities
and
equity $4,067,829 $3,593,128
========== ==========
Net interest
income /
net
interest
rate spread $ 29,072 2.80% $ 22,130 2.44%
=============== ================
Net interest
-earning
assets /
net
interest
margin $ 246,762 3.00% $ 136,526 2.60%
========== ===== ========== =====
Ratio of
interest-
earning
assets to
interest-
bearing
liabilities 1.07X 1.04X
===== =====
(1) Loan interest income includes loan fee income (which includes
net amortization of deferred fees and costs, late charges, and
prepayment penalties) of approximately $0.1 million and $0.8
million for the three-month periods ended September 30, 2009
and 2008, respectively.
FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES
NET INTEREST MARGIN
(Dollars in Thousands)
(Unaudited)
For the nine months ended September 30,
------------------------------------------------------
2009 2008
-------------------------- --------------------------
Average Yield/ Average Yield/
Balance Interest Cost Balance Interest Cost
-------------------------- --------------------------
Assets
Interest-
earning
assets:
Mortgage
loans,
net (1) $2,925,164 $ 140,059 6.38% $2,699,362 $ 136,498 6.74%
Other loans,
net (1) 128,080 4,686 4.88 113,737 5,745 6.73
-------------------------- --------------------------
Total loans,
net 3,053,244 144,745 6.32 2,813,099 142,243 6.74
-------------------------- --------------------------
Mortgage-
backed
securities 705,995 25,744 4.86 383,540 14,887 5.18
Other
securities 60,177 2,034 4.51 84,364 3,330 5.26
-------------------------- --------------------------
Total
securities 766,172 27,778 4.83 467,904 18,217 5.19
-------------------------- --------------------------
Interest-
earning
deposits
and federal
funds sold 47,748 71 0.20 30,486 533 2.33
-------------------------- --------------------------
Total
interest
-earning
assets 3,867,164 172,594 5.95 3,311,489 160,993 6.48
--------------- ---------------
Other assets 183,866 187,637
---------- ----------
Total assets $4,051,030 $3,499,126
========== ==========
Liabilities
and Equity
Interest-
bearing
liabilities:
Deposits:
Savings
accounts $ 418,022 4,396 1.40 $ 369,422 6,017 2.17
NOW
accounts 356,241 4,407 1.65 120,767 2,247 2.48
Money
market
accounts 320,571 4,046 1.68 305,382 7,496 3.27
Certificate
of deposit
accounts 1,451,215 38,880 3.57 1,233,553 41,138 4.45
-------------------------- --------------------------
Total due
to
depositors 2,546,049 51,729 2.71 2,029,124 56,898 3.74
Mortgagors'
escrow
accounts 35,642 51 0.19 34,143 52 0.20
-------------------------- --------------------------
Total
deposits 2,581,691 51,780 2.67 2,063,267 56,950 3.68
Borrowed
funds 1,057,891 36,765 4.63 1,109,452 39,105 4.70
-------------------------- --------------------------
Total
interest-
bearing
liabilities 3,639,582 88,545 3.24 3,172,719 96,055 4.04
--------------- ---------------
Non interest-
bearing
deposits 73,486 73,125
Other
liabilities 27,352 20,507
---------- ----------
Total
liabilities 3,740,420 3,266,351
Equity 310,610 232,775
---------- ----------
Total
liabilities
and equity $4,051,030 $3,499,126
========== ==========
Net interest
income/net
interest rate
spread $ 84,049 2.71% $ 64,938 2.44%
=============== ===============
Net interest-
earning assets
/net interest
margin $ 227,582 2.90% $ 138,770 2.61%
========== ===== ========== =====
Ratio of
interest-
earning assets
to interest-
bearing
liabilities 1.06X 1.04X
===== =====
(1) Loan interest income includes loan fee income (which includes
net amortization of deferred fees and costs, late charges, and
prepayment penalties) of approximately $0.6 million and $2.9
million for the nine-month periods ended September 30, 2009 and
2008, respectively.