NEW YORK — The wait for an expected deal between Greece and its creditors rattled financial markets around the world Monday. Yields for ultra-safe U.S. government debt hit their lowest this year, the euro dropped against the dollar, and European stocks took a fall.
But U.S. stocks dropped only slightly. The Dow Jones industrial average fell 6.74 points to close at 12,653.72, a drop of 0.1 percent. The Dow lost as much as 131 points in morning trading, then slowly recovered in the afternoon.
Borrowing costs for European countries with the heaviest debt burdens shot higher. The two-year interest rate for Portugal’s government debt jumped to 21 percent after trading around 14 percent last week.
Greece and the investors who bought its government bonds were said to be close to an agreement over the weekend. A tentative deal would replace bonds held by investment funds and banks with new ones at half the face value.
The plan is aimed at cutting Greece’s debt by roughly $132 billion. Greece needs it to secure a crucial installment of bailout loans and make an upcoming bond payment. But a deal has been in the works for weeks and could still fall apart.
The focus on Greece has shifted attention away from what’s going well in the U.S., said Jack Ablin, chief investment officer at Harris Private Bank. Companies have reported stronger quarterly earnings, and hiring has picked up.
“Our collective breath has been held for so many months,” he said.
At this point, a good or even a bad resolution of Greece’s debt crisis could lead to a stronger U.S. stock market, Ablin said. “If it finally happens and the world doesn’t fall apart, maybe we’ll have a reason to take risk again,” he said. “Once you pull off the Band-Aid, it feels better.”
U.S. Treasury yields sank to their lowest level this year.
In other trading, the Standard & Poor’s 500 index fell 3.32 points, or 0.3 percent, to 1,313.01. The Nasdaq composite lost 4.6 points, or 0.2 percent, to 2,811.94.
The euro dropped 0.5 percent against the dollar to $1.3124 in late trading Monday from $1.3208 late Friday. It was worth almost $1.50 in May.
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2012年1月31日星期二
Will President Obama's Blueprint Cut College Costs?
Mark Kantrowitz is the founder of the Web sites finaid.org, and fastweb.com. He regularly answers reader questions on The Choice. Readers can post comments of their own at the end of this essay.
In his State of the Union address, President Obama announced several proposals to make college more affordable. These included doubling the number of federal work-study program jobs over five years, a one-year extension of low interest rates on certain federal student loans and a permanent extension of the American Opportunity Tax Credit. President Obama also “put colleges on notice,” telling the colleges that if they can’t stop tuition from going up, the financing they get from taxpayers each year will go down. The president also announced initiatives to help families make informed decisions concerning college costs and quality.
More money for college is better than none. As a nation, we must put a priority on increasing federal and state investment in higher education. Maintaining the status quo or making slight tweaks to student aid financing is not enough.
Yet a key concern is that increases in some student aid programs may come at the expense of cuts in other more effective student aid programs.
It is unclear how President Obama plans on paying for increases in student aid financing while Congress concentrates on cost-cutting. Congress cut $8 billion a year out of the Pell grant program last year by ending the year-round Pell grant program, which allowed students in accelerated degree programs to get two Pell grants in a single year. Congress reduced the income threshold at which a student qualifies for a full Pell grant from $32,000 to $23,000. This cuts the Pell grants by $1,100 to $1,700 for nearly 14 percent of Pell grant recipients. Additional cuts are looming on the horizon.
The tight federal budgets yield a zero-sum game, where increases in one form of federal student aid force cuts in other forms of student aid. Adding 700,000 more federal work-study jobs over five years will cost more than $1 billion a year.
But how will the Obama administration pay for a one-year extension of the 3.4 percent interest rate on subsidized Stafford loans for undergraduate students? Approximately 7.4 million students will borrow about $3,500 in subsidized Stafford loans on average, costing the federal government more than $7 billion. The permanent extension of the American Opportunity Tax Credit will add several billion dollars more a year in tax expenditures. If the Obama administration doesn’t find savings elsewhere in the budget, these spending increases will force cuts in the Pell grant program, causing declines in Bachelor’s degree attainment by low-income students. That would be a bad bargain.
The risk is that the proposals for increasing student aid financing may be little more than a shell game, where the federal government gives with one hand and takes back with the other. For example, President Obama’s proposal for a one-year delay in the doubling of interest on the subsidized Stafford loan program will be coupled with increases in interest rates on the Perkins loan program. The re-engineering of the Perkins loan program will increase the interest rate on the Perkins loan from 5 percent to 6.8 percent and transform the subsidized Perkins loan into an unsubsidized Stafford loan. (This will save students some money, by shifting borrowing from higher-cost private student loans to lower-cost federal education loans. But it still involves increasing some interest rates to reduce others). Shuffling the deck doesn’t yield a net gain if there is no improvement in college graduation rates or other public policy objectives.
If the federal government can pay for cutting the interest rates on subsidized Stafford loans in half, then why was it necessary to cut the average Pell grant? Changing the interest rates and subsidized interest benefits on student loans has no impact on college access and completion rates. In contrast, the Pell grant program enables low-income students to enroll in college and to graduate. Cutting Pell grant financing forces low-income students to borrow more, shift enrollment to lower-cost colleges or drop out of college. Increasing the interest rate is a better alternative than cutting the Pell grant.
President Obama’s proposal to provide colleges with an incentive to keep tuition affordable will have a modest impact on tuition inflation. The proposal will base a college’s allocation of federal campus-based aid on whether the college keeps net tuition affordable, limits tuition increases and helps low-income students to enroll and graduate. But the $10 billion in campus-based financing represents only about 6 percent of all federal student aid financing and the allocation formula is complicated. The prospect of losing this financing may force some colleges to increase tuition even faster to compensate for the loss of campus-based aid financing.
There are limits to the ability of colleges to control costs. The consumer inflation rate has little to do with increases in college costs. College costs are largely driven by increases in the number of faculty and staff, increases in salaries, increases in facility costs, energy costs, equipment costs and health care costs, increases in institutional financial aid financing and decreases in federal and state financing. For example, if a college has a discount rate of 37 percent, the college must increase tuition by $1.59 to net $1 in additional revenue. This contributes to college tuition increasing faster than inflation by adding a multiplier effect.
President Obama’s proposal to create a mandatory “Financial Aid Shopping Sheet” and “College Scorecard”, on the other hand, will do more to constrain increases in college costs. This standardization of college cost and financial aid disclosures will provide families with clear, correct and comparable information about the real bottom-line cost of college.
This will help them make informed decisions concerning the tradeoffs between college affordability and other factors in college choice. More families will choose high quality but lower-cost colleges, forcing colleges to cut costs while maintaining or improving quality.
Now it’s your turn, Choice readers. Tell us your opinion on the president’s proposal, or at least Mr. Kantrowitz’s analysis of it, by using the box below.
http://tourism9.com/ http://vkins.com/
In his State of the Union address, President Obama announced several proposals to make college more affordable. These included doubling the number of federal work-study program jobs over five years, a one-year extension of low interest rates on certain federal student loans and a permanent extension of the American Opportunity Tax Credit. President Obama also “put colleges on notice,” telling the colleges that if they can’t stop tuition from going up, the financing they get from taxpayers each year will go down. The president also announced initiatives to help families make informed decisions concerning college costs and quality.
More money for college is better than none. As a nation, we must put a priority on increasing federal and state investment in higher education. Maintaining the status quo or making slight tweaks to student aid financing is not enough.
Yet a key concern is that increases in some student aid programs may come at the expense of cuts in other more effective student aid programs.
It is unclear how President Obama plans on paying for increases in student aid financing while Congress concentrates on cost-cutting. Congress cut $8 billion a year out of the Pell grant program last year by ending the year-round Pell grant program, which allowed students in accelerated degree programs to get two Pell grants in a single year. Congress reduced the income threshold at which a student qualifies for a full Pell grant from $32,000 to $23,000. This cuts the Pell grants by $1,100 to $1,700 for nearly 14 percent of Pell grant recipients. Additional cuts are looming on the horizon.
The tight federal budgets yield a zero-sum game, where increases in one form of federal student aid force cuts in other forms of student aid. Adding 700,000 more federal work-study jobs over five years will cost more than $1 billion a year.
But how will the Obama administration pay for a one-year extension of the 3.4 percent interest rate on subsidized Stafford loans for undergraduate students? Approximately 7.4 million students will borrow about $3,500 in subsidized Stafford loans on average, costing the federal government more than $7 billion. The permanent extension of the American Opportunity Tax Credit will add several billion dollars more a year in tax expenditures. If the Obama administration doesn’t find savings elsewhere in the budget, these spending increases will force cuts in the Pell grant program, causing declines in Bachelor’s degree attainment by low-income students. That would be a bad bargain.
The risk is that the proposals for increasing student aid financing may be little more than a shell game, where the federal government gives with one hand and takes back with the other. For example, President Obama’s proposal for a one-year delay in the doubling of interest on the subsidized Stafford loan program will be coupled with increases in interest rates on the Perkins loan program. The re-engineering of the Perkins loan program will increase the interest rate on the Perkins loan from 5 percent to 6.8 percent and transform the subsidized Perkins loan into an unsubsidized Stafford loan. (This will save students some money, by shifting borrowing from higher-cost private student loans to lower-cost federal education loans. But it still involves increasing some interest rates to reduce others). Shuffling the deck doesn’t yield a net gain if there is no improvement in college graduation rates or other public policy objectives.
If the federal government can pay for cutting the interest rates on subsidized Stafford loans in half, then why was it necessary to cut the average Pell grant? Changing the interest rates and subsidized interest benefits on student loans has no impact on college access and completion rates. In contrast, the Pell grant program enables low-income students to enroll in college and to graduate. Cutting Pell grant financing forces low-income students to borrow more, shift enrollment to lower-cost colleges or drop out of college. Increasing the interest rate is a better alternative than cutting the Pell grant.
President Obama’s proposal to provide colleges with an incentive to keep tuition affordable will have a modest impact on tuition inflation. The proposal will base a college’s allocation of federal campus-based aid on whether the college keeps net tuition affordable, limits tuition increases and helps low-income students to enroll and graduate. But the $10 billion in campus-based financing represents only about 6 percent of all federal student aid financing and the allocation formula is complicated. The prospect of losing this financing may force some colleges to increase tuition even faster to compensate for the loss of campus-based aid financing.
There are limits to the ability of colleges to control costs. The consumer inflation rate has little to do with increases in college costs. College costs are largely driven by increases in the number of faculty and staff, increases in salaries, increases in facility costs, energy costs, equipment costs and health care costs, increases in institutional financial aid financing and decreases in federal and state financing. For example, if a college has a discount rate of 37 percent, the college must increase tuition by $1.59 to net $1 in additional revenue. This contributes to college tuition increasing faster than inflation by adding a multiplier effect.
President Obama’s proposal to create a mandatory “Financial Aid Shopping Sheet” and “College Scorecard”, on the other hand, will do more to constrain increases in college costs. This standardization of college cost and financial aid disclosures will provide families with clear, correct and comparable information about the real bottom-line cost of college.
This will help them make informed decisions concerning the tradeoffs between college affordability and other factors in college choice. More families will choose high quality but lower-cost colleges, forcing colleges to cut costs while maintaining or improving quality.
Now it’s your turn, Choice readers. Tell us your opinion on the president’s proposal, or at least Mr. Kantrowitz’s analysis of it, by using the box below.
http://tourism9.com/ http://vkins.com/
Trinity Bank 2011 Net Income up 13.8%
FORT WORTH, TX–(Marketwire -01/30/12)- Trinity Bank, N.A. (OTC.BB: TYBT.OB – News) today announced financial and operating results for the fourth quarter and for the twelve months ended December 31, 2011.
Results of Operations
Trinity Bank, N.A. reported Net Income After Taxes for the fourth quarter of $605,157.56, or $.54 per diluted common share, compared to $525,279, or $.46 per diluted common share for the fourth quarter of 2010, an increase of 17.4%.
For the year 2011, Net Income After Taxes amounted to $2,282,024, or $2.02 per diluted common share, compared to $2,004,875, or $1.74 per diluted common share for 2010, an increase of 16.1%.
Jeffrey M. Harp, President, stated, “Operating results for the fourth quarter of 2011 represent our 29th consecutive quarter of increased profit. We continue to improve the return on the bank’s assets and the return on the shareholder’s investment. While 2011 was a challenging year, 2012 is shaping up to be equally demanding. However, we look forward to maintaining our record of improving Trinity Bank‘s performance each year.”
This Press Release may contain certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 regarding future financial conditions, results of operations and the Bank’s business operations. Such forward-looking statements involve risks, uncertainties and assumptions, including, but not limited to, monetary policy and general economic conditions in Texas and the greater Dallas-Fort Worth metropolitan area, the risks of changes in interest rates on the level and composition of deposits, loan demand and the values of loan collateral, securities and interest rate protection agreements, the actions of competitors and customers, the success of the Bank in implementing its strategic plan, the failure of the assumptions underlying the reserves for loan losses and the estimations of values of collateral and various financial assets and liabilities, that the costs of technological changes are more difficult or expensive than anticipated, the effects of regulatory restrictions imposed on banks generally, any changes in fiscal, monetary or regulatory policies and other uncertainties as discussed in the Bank’s Registration Statement on Form SB-1 filed with the Office of the Comptroller of the Currency. Should one or more of these risks or uncertainties materialize, or should these underlying assumptions prove incorrect, actual outcomes may vary materially from outcomes expected or anticipated by the Bank. A forward-looking statement may include a statement of the assumptions or bases underlying the forward-looking statement. The Bank believes it has chosen these assumptions or bases in good faith and that they are reasonable. However, the Bank cautions you that assumptions or bases almost always vary from actual results, and the differences between assumptions or bases and actual results can be material. The Bank undertakes no obligation to publicly update or otherwise revise any forward-looking statements, whether as a result of new information, future events or otherwise, unless the securities laws require the Bank to do so.
Results of Operations
Trinity Bank, N.A. reported Net Income After Taxes for the fourth quarter of $605,157.56, or $.54 per diluted common share, compared to $525,279, or $.46 per diluted common share for the fourth quarter of 2010, an increase of 17.4%.
For the year 2011, Net Income After Taxes amounted to $2,282,024, or $2.02 per diluted common share, compared to $2,004,875, or $1.74 per diluted common share for 2010, an increase of 16.1%.
Jeffrey M. Harp, President, stated, “Operating results for the fourth quarter of 2011 represent our 29th consecutive quarter of increased profit. We continue to improve the return on the bank’s assets and the return on the shareholder’s investment. While 2011 was a challenging year, 2012 is shaping up to be equally demanding. However, we look forward to maintaining our record of improving Trinity Bank‘s performance each year.”
For Year Ending
-------------------------------------------------------
2011 2010 2009 2008 2007
---------- ---------- ----- ----- ----
Return on Assets 1.46% 1.30% 1.12% 1.11% 0.96%
Return on Equity
(excluding unrealized gain 13.22% 12.57% 11.33% 10.80% 8.88%
on securities)
Average for Year Ending
12-31-11 12-31-10
---------- ----------
Loans $ 73,556 $ 72,786 1.1%
Deposits $ 137,086 $ 133,850 2.4%
Actual for Year Ending
Net Interest Income $ 5,034 $ 4,891 2.9%
Non-Interest Income $ 540 $ 585 (7.7%)
Non-Interest Expense $ 2,573 $ 2,522 2.0%
Loan Loss Provision $ 0 $ 285 -
Pre Tax Income $ 3,001 $ 2,669 12.4%
Income Tax $ 719 $ 664 8.3%
Net Income $ 2,282 $ 2,005 13.8%
Trinity Bank, N.A. is a commercial bank that began operations May 28, 2003. For a full financial statement, visit Trinity Bank’s website: www.trinitybk.com click on “About Us” and then click on “Investor Information.” Financial information in regulatory reporting format is also available at www.fdic.gov.This Press Release may contain certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 regarding future financial conditions, results of operations and the Bank’s business operations. Such forward-looking statements involve risks, uncertainties and assumptions, including, but not limited to, monetary policy and general economic conditions in Texas and the greater Dallas-Fort Worth metropolitan area, the risks of changes in interest rates on the level and composition of deposits, loan demand and the values of loan collateral, securities and interest rate protection agreements, the actions of competitors and customers, the success of the Bank in implementing its strategic plan, the failure of the assumptions underlying the reserves for loan losses and the estimations of values of collateral and various financial assets and liabilities, that the costs of technological changes are more difficult or expensive than anticipated, the effects of regulatory restrictions imposed on banks generally, any changes in fiscal, monetary or regulatory policies and other uncertainties as discussed in the Bank’s Registration Statement on Form SB-1 filed with the Office of the Comptroller of the Currency. Should one or more of these risks or uncertainties materialize, or should these underlying assumptions prove incorrect, actual outcomes may vary materially from outcomes expected or anticipated by the Bank. A forward-looking statement may include a statement of the assumptions or bases underlying the forward-looking statement. The Bank believes it has chosen these assumptions or bases in good faith and that they are reasonable. However, the Bank cautions you that assumptions or bases almost always vary from actual results, and the differences between assumptions or bases and actual results can be material. The Bank undertakes no obligation to publicly update or otherwise revise any forward-looking statements, whether as a result of new information, future events or otherwise, unless the securities laws require the Bank to do so.
TRINITY BANK N.A. (Unaudited) (Dollars in thousands, except per share data) Quarter Ended Twelve Months Ended December 31 % December 31 % EARNINGS SUMMARY 2011 2010 Change 2011 2010 Change Interest income 1,509 1,516 -0.5% 5,879 6,081 -3.3% Interest expense 199 270 -26.3% 845 1,190 -29.0% Net Interest Income 1,310 1,246 5.1% 5,034 4,891 2.9% Provision for Loan Losses 0 150 N/A 0 285 N/A Service charges on deposits 37 34 8.8% 147 145 1.4% Net gain on securities available for sale 18 153 -88.2% 114 198 -42.4% Other income 55 55 0.0% 279 242 15.3% Total Non Interest Income 110 242 -54.5% 540 585 -7.7% Salaries and benefits expense 450 437 3.0% 1,419 1,384 2.5% Occupancy and equipment expense 81 75 8.0% 314 308 1.9% Other expense 90 136 -33.8% 840 830 1.2% Total Non Interest Expense 621 648 -4.2% 2,573 2,522 2.0% Earnings before income taxes 799 690 15.8% 3,001 2,669 12.4% Provision for income taxes 194 165 17.6% 719 664 8.3% Net Earnings 605 525 15.2% 2,282 2,005 13.8% Basic earnings per share 0.57 0.49 16.3% 2.15 1.83 17.3% Basic weighted average shares outstanding 1,059 1,079 1,063 1,098 Diluted earnings per share 0.54 0.46 17.4% 2.02 1.74 16.1% Diluted weighted average shares outstanding 1,122 1,135 1,127 1,154 Average for Quarter Average for Twelve Months Ending December 31 % Ending December 31 % BALANCE SHEET SUMMARY 2011 2010 Change 2011 2010 Change Total loans $ 76,426 $ 72,047 6.1% $ 73,556 $ 72,786 1.1% Total short term investments 26,760 23,496 13.9% 21,500 22,244 -3.3% Total investment securities 56,751 53,988 5.1% 54,003 50,802 6.3% Earning assets 159,937 149,531 7.0% 149,059 145,832 2.2% Total assets 166,392 155,868 6.8% 156,233 152,957 2.1% Noninterest bearing deposits 32,552 24,267 34.1% 28,743 23,217 23.8% Interest bearing deposits 113,758 112,540 1.1% 108,343 110,633 -2.1% Total deposits 146,310 136,807 6.9% 137,086 133,850 2.4% Fed Funds Purchased and Repurchase Agreements 584 733 -20.3% 503 880 -42.8% Shareholders' equity 18,690 17,382 7.5% 17,943 17,225 4.2% TRINITY BANK N.A. (Unaudited) (Dollars in thousands, except per share data) Average for Quarter Ending Dec 31, Sept. 30, June 30, March 31, Dec 31, BALANCE SHEET SUMMARY 2011 2011 2011 2011 2010 Total loans $ 76,426 $ 74,941 $ 71,676 $ 71,103 $ 72,047 Total short term investments 26,760 21,204 21,929 17,742 23,496 Total investment securities 56,751 51,908 50,714 56,684 53,988 Earning assets 159,937 148,053 144,319 145,529 149,531 Total assets 166,392 154,363 152,633 151,401 155,868 Noninterest bearing deposits 32,552 27,706 25,176 24,123 24,267 Interest bearing deposits 113,758 107,061 108,696 109,154 112,540 Total deposits 146,310 134,767 133,872 133,277 136,807 Fed Funds Purchased and Repurchase Agreements 584 411 438 582 733 Shareholders' equity 18,690 18,401 17,687 16,972 17,382 Quarter Ended Dec 31, Sept. 30, June 30, March 31, Dec 31, HISTORICAL EARNINGS SUMMARY 2011 2011 2011 2011 2010 Interest income 1,509 1,471 1,426 1,474 1,516 Interest expense 199 203 217 226 270 Net Interest Income 1,310 1,268 1,209 1,248 1,246 Provision for Loan Losses 0 0 0 0 150 Service charges on deposits 37 35 29 37 34 Net gain on securities available for sale 18 40 28 29 153 Other income 55 92 78 63 55 Total Non Interest Income 110 167 135 129 242 Salaries and benefits expense 450 317 312 340 437 Occupancy and equipment expense 81 82 79 75 75 FDIC expense 45 45 45 45 45 Other expense 45 226 173 215 91 Total Non Interest Expense 621 670 609 675 648 Earnings before income taxes 799 765 735 702 690 Provision for income taxes 194 185 177 163 165 Net Earnings 605 580 558 539 525 TRINITY BANK N.A. (Unaudited) (Dollars in thousands, except per share data) Ending Balance Sept. March Dec 31, 30, June 30, 31, Dec 31, HISTORICAL BALANCE SHEET 2011 2011 2011 2011 2010 Total loans $ 81,272 $ 76,180 $ 74,822 $ 71,287 $ 72,460 Total short term investments 19,279 27,716 17,404 25,369 17,886 Total investment securities 58,540 53,370 51,982 53,497 58,583 Total earning assets 159,091 157,266 144,208 150,153 148,929 Allowance for loan losses (1,371) (1,371) (1,371) (1,371) (1,371) Premises and equipment 1,378 1,413 1,404 1,440 1,442 Other Assets 7,843 6,209 5,850 6,024 4,949 Total assets 166,941 163,517 150,091 156,246 153,949 Noninterest bearing deposits 34,203 33,733 24,208 27,747 26,844 Interest bearing deposits 112,163 109,722 106,761 110,161 109,100 Total deposits 146,366 143,455 130,969 137,908 135,944 Fed Funds Purchased and Repurchase Agreements 713 398 292 534 538 Other Liabilities 792 896 690 559 646 Total liabilities 147,871 144,749 131,951 139,001 137,128 Shareholders' Equity Actual 18,025 17,667 17,306 16,715 16,176 Unrealized Gain - AFS 1,045 1,100 834 530 645 Total Equity 19,070 18,767 18,140 17,245 16,821 Quarter Ending Sept. March Dec 31, 30, June 30, 31, Dec 31, NONPERFORMING ASSETS 2011 2011 2011 2011 2010 Nonaccrual loans $ 653 $ 735 $ 850 $ 488 $ 831 Restructured loans $ 0 $ 0 $ 0 $ 0 $ 0 Other real estate & foreclosed assets $ 0 $ 0 $ 0 $ 0 $ 0 Accruing loans past due 90 days or more $ 0 $ 0 $ 0 $ 0 $ 0 Total nonperforming assets $ 653 $ 735 $ 850 $ 488 $ 831 Accruing loans past due 30-89 days $ 0 $ 0 $ 0 $ 0 $ 0 Total nonperforming assets as a percentage of loans and foreclosed assets 0.80% 0.96% 1.12% 0.68% 1.15% TRINITY BANK N.A. (Unaudited) (Dollars in thousands, except per share data) Quarter Ending Sept. March ALLOWANCE FOR Dec 31, 30, June 30, 31, Dec 31, LOAN LOSSES 2011 2011 2011 2011 2010 Balance at beginning of period $ 1,371 $ 1,371 $ 1,371 $ 1,371 $ 1,221 Loans charged off 0 0 0 0 0 Loan recoveries 0 0 0 0 0 Net (charge-offs) recoveries 0 0 0 0 0 Provision for loan losses 0 0 0 0 150 Balance at end of period $ 1,371 $ 1,371 $ 1,371 $ 1,371 $ 1,371 Allowance for loan losses as a percentage of total loans 1.69% 1.80% 1.80% 1.92% 1.89% Allowance for loan losses as a percentage of nonperforming loans 209.95% 186.53% 186.53% 280.94% 164.98% Net charge-offs (recoveries) as a percentage of average loans N/A N/A N/A N/A N/A Provision for loan losses as a percentage of average loans N/A N/A N/A N/A 0.21% Quarter Ending Sept. March Dec 31, 30, June 30, 31, Dec 31, SELECTED RATIOS 2011 2011 2011 2011 2010 Return on average assets (annualized) 1.45% 1.50% 1.46% 1.42% 1.35% Return on average equity (annualized) 12.95% 12.61% 12.62% 12.70% 12.08% Return on average equity (excluding unrealized gain on investments) 13.62% 13.26% 13.11% 12.90% 12.91% Average shareholders' equity to average assets 11.23% 11.92% 11.59% 11.21% 11.15% Yield on earning assets (tax equivalent) 4.05% 4.26% 4.24% 4.27% 4.32% Cost of interest bearing funds 0.70% 0.76% 0.80% 0.82% 0.96% Net interest margin (tax equivalent) 3.56% 3.72% 3.64% 3.65% 3.49% Efficiency ratio (tax equivalent) 40.55 43.42 42.29 45.45 45.18 End of period book value per common share 18.05 17.60 17.51 16.16 15.59 End of period book value (excluding unrealized gain on investments) 17.07 16.57 16.48 15.67 14.99 End of period common shares outstanding 1,056 1,066 1,072 1,067 1,079
TRINITY BANK N.A.
(Unaudited)
(Dollars in thousands, except per share data)
12 Months Ending
December 31, 2011
Tax
Average Equivalent
YIELD ANALYSIS Balance Interest Yield Yield
Interest Earning Assets:
Short term investment 21,500 130 0.60% 0.60%
Investment securities 18,758 828 4.41% 4.41%
Tax Free securities 35,245 981 2.78% 4.01%
Loans 73,556 3,940 5.36% 5.36%
Total Interest Earning Assets 149,059 5,879 3.94% 4.23%
Noninterest Earning Assets:
Cash and due from banks 4,344
Other assets 4,201
Allowance for loan losses (1,371)
Total Noninterest Earning
Assets 7,174
Total Assets $ 156,233
Interest Bearing Liabilities:
Transaction and Money Market
accounts 79,916 549 0.69% 0.69%
Certificates and other time
deposits 29,762 294 0.99% 0.99%
Other borrowings 503 2 0.40% 0.40%
Total Interest Bearing
Liabilities 110,181 845 0.77% 0.77%
Noninterest Bearing Liabilities
Demand deposits 27,408
Other liabilities 701
Shareholders' Equity 17,943
Total Liabilities and
Shareholders Equity $ 156,233
Net Interest Income and Spread 5,034 3.18% 3.47%
Net Interest Margin 3.38% 3.67%
12 Months Ending
December 31, 2010
Tax
Average Equivalent
YIELD ANALYSIS Balance Interest Yield Yield
Interest Earning Assets:
Short term investment 22,244 259 1.16% 1.16%
Investment securities 25,694 1,116 4.34% 4.34%
Tax Free securities 25,108 788 3.14% 4.52%
Loans 72,786 3,918 5.38% 5.38%
Total Interest Earning Assets 145,832 6,081 4.17% 4.42%
Noninterest Earning Assets:
Cash and due from banks 3,127
Other assets 5,194
Allowance for loan losses (1,196)
Total Noninterest Earning
Assets 7,125
Total Assets $ 152,957
Interest Bearing Liabilities:
Transaction and Money Market
accounts 78,624 734 0.93% 0.93%
Certificates and other time
deposits 32,009 450 1.41% 1.41%
Other borrowings 880 6 0.68% 0.68%
Total Interest Bearing
Liabilities 111,513 1,190 1.07% 1.07%
Noninterest Bearing Liabilities
Demand deposits 23,217
Other liabilities 1,002
Shareholders' Equity 17,225
Total Liabilities and
Shareholders Equity $ 152,957
Net Interest Income and Spread 4,891 3.10% 3.35%
Net Interest Margin 3.35% 3.60%
TRINITY BANK N.A.
(Unaudited)
(Dollars in thousands, except per share data)
December 31 December 31
2011 % 2010 %
LOAN PORTFOLIO
Commercial and industrial 40,359 49.66% 35,155 48.52%
Real estate:
Commercial 13,112 16.13% 14,939 20.62%
Residential 16,400 20.18% 12,680 17.50%
Construction and
development 8,947 11.01% 7,839 10.82%
Consumer 2,454 3.02% 1,847 2.55%
Total loans (gross) 81,272 100.00% 72,460 100.00%
Unearned discounts 0 0.00% 0 0.00%
Total loans (net) 81,272 100.00% 72,460 100.00%
December 31 December 31
2011 2010
REGULATORY CAPITAL DATA
Tier 1 Capital $ 18,025 $ 16,176
Total Capital (Tier 1 +
Tier 2) $ 19,333 $ 17,443
Total Risk-Adjusted Assets $ 104,570 $ 101,272
Tier 1 Ratio 17.24% 15.97%
Total Capital Ratio 18.49% 17.22%
Tier 1 Leverage Ratio 10.86% 10.40%
OTHER DATA
Full Time Equivalent
Employees (FTE's) 14 14
Stock Price Range
(For the Three Months
Ended):
High $ 27.00 $ 25.50
Low $ 24.10 $ 21.00
Close $ 26.50 $ 24.10
Premier Service Bank Announces Financial Results for the Quarter and Year Ended December 31, 2011
RIVERSIDE, Calif.–(BUSINESS WIRE)– Premier Service Bank (OTCBB:PSBK.OB – News) today announced its unaudited financial results for the quarter and year ended December 31, 2011.
For the year ended December 31, 2011, the Bank reported a net loss of $2.19 million, or ($1.77) per diluted share, compared to a net loss of $3.26 million, or ($2.66) per diluted share for the year ended December 31, 2010. The net loss for the fourth quarter of 2011 was $820 thousand, or ($0.66) per diluted share, compared to a net loss of $707 thousand, or ($0.57) per diluted share for the fourth quarter of 2010. The variance in earnings between the respective periods is primarily attributed to the provisions to the Bank’s allowance for loan losses, which, for the year ended December 31, 2011, totaled $2.79 million, compared to $4.01 million for the year ended December 31, 2010. The provision to the allowance for loan losses for the fourth quarter of 2010 totaled $910 thousand, compared to $960 thousand for the same period in 2010.
At December 31, 2011, the Bank had $8.93 million of non-performing loans, representing 8.61% of the Bank’s total loans, compared to $8.21 million of non-performing loans, or 6.98% of total loans, at December 31, 2010. Impairment analyses are performed on the Bank’s non-performing loans and impairment adjustments, if any, are written off as a part of this process. The Bank had foreclosed real estate of $2.92 million at December 31, 2011, compared to foreclosed real estate of $1.87 million at December 31, 2010. All non-performing loans were on non-accrual at December 31, 2011 and 2010. The allowance for loan losses totaled $2.36 million at December 31, 2011, or 2.28% of total loans as of that date, compared to $2.55 million at December 31, 2010, or 2.17% of total loans as of that date.
At December 31, 2011, the Bank had total assets of $141 million, representing a decrease of $14.7 million or 9.45% compared to total assets of $156 million at December 31, 2010. Total deposits at December 31, 2011 were $111.8 million, representing a 9.43% reduction compared to total deposits of $123.4 million at December 31, 2010. Non-interest bearing demand deposits totaled $41.1 million at December 31, 2011, representing 36.8% of total deposits at that date, compared to $37.6 million of non-interest bearing demand deposits at December 31, 2010, which represented 30.5% of total deposits at that date.
The Bank’s gross loan portfolio totaled $103.7 million at December 31, 2011, representing an 11.9% decrease compared to gross loans of $117.6 million at December 31, 2010. Unfunded credit commitments stood at $7.6 million at December 31, 2011, representing a 42.9% decrease when compared to unfunded commitments of $13.3 million at December 31, 2010.
The Bank’s net interest margin for the year ended December 31, 2011 was 4.82%, a decrease of 0.14% compared to the net interest margin of 4.96% for the year ended December 31, 2010. The Bank’s net interest margin for the quarter ended December 31, 2011 was 4.64%, a decrease of 0.09% compared to the net interest margin of 4.73% for the fourth quarter of 2010.
At December 31, 2011, the Bank was adequately capitalized under applicable regulatory guidelines. Total shareholders’ equity at December 31, 2011 was $10.7 million, representing a decrease of $2.2 million, or 17%, compared to total shareholders’ equity of $12.9 million at December 31, 2010. On December 1, 2010, the Bank entered into a Consent Order with the Federal Deposit Insurance Corporation and the California Department of Financial Institutions. Among the provisions of the Consent Order is the requirement that within 90 days from the effective date of the Order (by February 28, 2011), the Bank shall increase and thereafter maintain its Tier I capital in such an amount to ensure that the Bank’s leverage ratio equals or exceeds 9.50 percent and its total risk-based capital ratio equals or exceeds 12 percent. The Bank was not in compliance with this requirement as of February 28, 2011 as required by the Order. As of December 31, 2011, these capital ratios were 7.21% and 10.78%, respectively. As a result, the Bank had not achieved compliance, as of December 31, 2011, with the capital ratios required by the Order. The Bank attempted to comply with the capital requirements of the Order during 2011, but its private placement offering during 2011 of up to $10 million of common stock to accredited investors was not successful. The stock permit issued by the DFI for that offering expired on December 23, 2011, and the Bank did not request an extension of the permit in view of the stale financial statements included in the offering and other factors. Because the Bank did not sell the minimum amount required by the offering, all subscriptions were returned when the offering expired. Before the Bank may commence a new offering, it must receive audited financial statements for its year ended December 31, 2011, and a new stock permit must be issued. Audited financial statements are anticipated to be issued in early February. At that time, if the Bank has not satisfied the capital ratios required by the Order, the Bank intends to seek a new stock permit from the Department of Financial Institutions for the sale of up to $10 million of common stock to accredited investors in another nonpublic offering. While the Bank continues to be adequately capitalized under applicable regulatory guidelines, in order to comply with the capital requirements of the Consent Order the Bank will need to complete the proposed capital offering in 2012 or find another solution which improves its capital ratios, including the possible sale of the Bank or a transfer of control of the Bank, or taking steps to decrease the asset size of the Bank until the ratios are in compliance with the Consent Order.
The Bank’s President and Chief Executive Officer, Kerry L. Pendergast, stated, “While 2011, in most respects, was a continuum of 2010, there are anecdotal signs suggesting that, perhaps, the local marketplace is beginning to shows some signs of stabilization. While it is too early to state that we’ve turned the corner, I would suggest that our customers appear to be more optimistic about the future.”
Pendergast went on to say, “Throughout 2011 Premier Service Bank focused its efforts on managing the credit portfolio; while this message has been embedded in our releases for quite some time, it is central to returning the Bank to consistent profitability. Recognizing that delinquency is generally a precursor to more serious issues developing in a relationship, management and staff intensified their collection efforts throughout the year; as a result, overall delinquency within the institution has been trending downward over the last 2 quarters. In 2011 the Bank contributed $2.79 million to its Allowance for Loan Losses as compared to a contribution of $4.01 million in 2010; this serves to support the belief that the pace of problem loans is beginning to decline and that appraisal valuations, tied to Classified Commercial Real Estate Loans, are also beginning to stabilize.”
Pendergast said in closing, “While improving the overall asset quality of the Bank continues to be the primary focus of the executive management team and our Board of Directors, our entire team works tirelessly to ensure that our “customer first” mindset does not get lost in the process. Throughout the year, all of the Bank’s front line officers participated in a structured calling program that focused on the Bank’s existing customer base; at a minimum, each client assigned to an account officer was called on at least twice within the calendar year. The importance of retention calling cannot be overstated and is critical in an environment where large, money center banks are entering the region with the dollars and the resources to buy market share.”
Premier Service Bank is a California state-chartered bank with two offices, its headquarters office in Riverside and a full-service banking office in Corona. The Bank provides commercial banking services, including a wide variety of checking accounts, investment services with competitive deposit rates, on-line banking products, and real estate, construction, commercial and consumer loans, to small and medium-sized businesses, professionals and individuals. Additional information about Premier Service Bank is available at its website at www.premierservicebank.com.
Forward-looking Statements
This news release contains statements that are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on current expectations, estimates and projections about Premier Service Bank’s business based, in part, on assumptions made by management. These statements are not guarantees of future performance and involve risks, uncertainties and assumptions that are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or forecasted in such forward-looking statements due to numerous factors, including those described above and in the following: Premier Service Bank’s ability to increase its assets, deposits and total loans, control expenses, retain critical personnel, manage interest rate risk, manage technological changes, address regulatory requirements, and other risks discussed from time to time in Premier Service Bank’s filings and reports with the Federal Deposit Insurance Corporation. In addition, such statements could be affected by general industry and market conditions and growth rates, and general domestic and international economic conditions. Such forward-looking statements speak only as of the date on which they are made, and Premier Service Bank does not undertake any obligation to update any forward-looking statement to reflect events or circumstances after the date of this release.
For a more complete discussion of risks and uncertainties, investors and security holders are urged to read Premier Service Bank’s annual report on Form 10-K, quarterly reports on Form 10-Q and other reports filed by Premier Service Bank with the FDIC.
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For the year ended December 31, 2011, the Bank reported a net loss of $2.19 million, or ($1.77) per diluted share, compared to a net loss of $3.26 million, or ($2.66) per diluted share for the year ended December 31, 2010. The net loss for the fourth quarter of 2011 was $820 thousand, or ($0.66) per diluted share, compared to a net loss of $707 thousand, or ($0.57) per diluted share for the fourth quarter of 2010. The variance in earnings between the respective periods is primarily attributed to the provisions to the Bank’s allowance for loan losses, which, for the year ended December 31, 2011, totaled $2.79 million, compared to $4.01 million for the year ended December 31, 2010. The provision to the allowance for loan losses for the fourth quarter of 2010 totaled $910 thousand, compared to $960 thousand for the same period in 2010.
At December 31, 2011, the Bank had $8.93 million of non-performing loans, representing 8.61% of the Bank’s total loans, compared to $8.21 million of non-performing loans, or 6.98% of total loans, at December 31, 2010. Impairment analyses are performed on the Bank’s non-performing loans and impairment adjustments, if any, are written off as a part of this process. The Bank had foreclosed real estate of $2.92 million at December 31, 2011, compared to foreclosed real estate of $1.87 million at December 31, 2010. All non-performing loans were on non-accrual at December 31, 2011 and 2010. The allowance for loan losses totaled $2.36 million at December 31, 2011, or 2.28% of total loans as of that date, compared to $2.55 million at December 31, 2010, or 2.17% of total loans as of that date.
At December 31, 2011, the Bank had total assets of $141 million, representing a decrease of $14.7 million or 9.45% compared to total assets of $156 million at December 31, 2010. Total deposits at December 31, 2011 were $111.8 million, representing a 9.43% reduction compared to total deposits of $123.4 million at December 31, 2010. Non-interest bearing demand deposits totaled $41.1 million at December 31, 2011, representing 36.8% of total deposits at that date, compared to $37.6 million of non-interest bearing demand deposits at December 31, 2010, which represented 30.5% of total deposits at that date.
The Bank’s gross loan portfolio totaled $103.7 million at December 31, 2011, representing an 11.9% decrease compared to gross loans of $117.6 million at December 31, 2010. Unfunded credit commitments stood at $7.6 million at December 31, 2011, representing a 42.9% decrease when compared to unfunded commitments of $13.3 million at December 31, 2010.
The Bank’s net interest margin for the year ended December 31, 2011 was 4.82%, a decrease of 0.14% compared to the net interest margin of 4.96% for the year ended December 31, 2010. The Bank’s net interest margin for the quarter ended December 31, 2011 was 4.64%, a decrease of 0.09% compared to the net interest margin of 4.73% for the fourth quarter of 2010.
At December 31, 2011, the Bank was adequately capitalized under applicable regulatory guidelines. Total shareholders’ equity at December 31, 2011 was $10.7 million, representing a decrease of $2.2 million, or 17%, compared to total shareholders’ equity of $12.9 million at December 31, 2010. On December 1, 2010, the Bank entered into a Consent Order with the Federal Deposit Insurance Corporation and the California Department of Financial Institutions. Among the provisions of the Consent Order is the requirement that within 90 days from the effective date of the Order (by February 28, 2011), the Bank shall increase and thereafter maintain its Tier I capital in such an amount to ensure that the Bank’s leverage ratio equals or exceeds 9.50 percent and its total risk-based capital ratio equals or exceeds 12 percent. The Bank was not in compliance with this requirement as of February 28, 2011 as required by the Order. As of December 31, 2011, these capital ratios were 7.21% and 10.78%, respectively. As a result, the Bank had not achieved compliance, as of December 31, 2011, with the capital ratios required by the Order. The Bank attempted to comply with the capital requirements of the Order during 2011, but its private placement offering during 2011 of up to $10 million of common stock to accredited investors was not successful. The stock permit issued by the DFI for that offering expired on December 23, 2011, and the Bank did not request an extension of the permit in view of the stale financial statements included in the offering and other factors. Because the Bank did not sell the minimum amount required by the offering, all subscriptions were returned when the offering expired. Before the Bank may commence a new offering, it must receive audited financial statements for its year ended December 31, 2011, and a new stock permit must be issued. Audited financial statements are anticipated to be issued in early February. At that time, if the Bank has not satisfied the capital ratios required by the Order, the Bank intends to seek a new stock permit from the Department of Financial Institutions for the sale of up to $10 million of common stock to accredited investors in another nonpublic offering. While the Bank continues to be adequately capitalized under applicable regulatory guidelines, in order to comply with the capital requirements of the Consent Order the Bank will need to complete the proposed capital offering in 2012 or find another solution which improves its capital ratios, including the possible sale of the Bank or a transfer of control of the Bank, or taking steps to decrease the asset size of the Bank until the ratios are in compliance with the Consent Order.
The Bank’s President and Chief Executive Officer, Kerry L. Pendergast, stated, “While 2011, in most respects, was a continuum of 2010, there are anecdotal signs suggesting that, perhaps, the local marketplace is beginning to shows some signs of stabilization. While it is too early to state that we’ve turned the corner, I would suggest that our customers appear to be more optimistic about the future.”
Pendergast went on to say, “Throughout 2011 Premier Service Bank focused its efforts on managing the credit portfolio; while this message has been embedded in our releases for quite some time, it is central to returning the Bank to consistent profitability. Recognizing that delinquency is generally a precursor to more serious issues developing in a relationship, management and staff intensified their collection efforts throughout the year; as a result, overall delinquency within the institution has been trending downward over the last 2 quarters. In 2011 the Bank contributed $2.79 million to its Allowance for Loan Losses as compared to a contribution of $4.01 million in 2010; this serves to support the belief that the pace of problem loans is beginning to decline and that appraisal valuations, tied to Classified Commercial Real Estate Loans, are also beginning to stabilize.”
Pendergast said in closing, “While improving the overall asset quality of the Bank continues to be the primary focus of the executive management team and our Board of Directors, our entire team works tirelessly to ensure that our “customer first” mindset does not get lost in the process. Throughout the year, all of the Bank’s front line officers participated in a structured calling program that focused on the Bank’s existing customer base; at a minimum, each client assigned to an account officer was called on at least twice within the calendar year. The importance of retention calling cannot be overstated and is critical in an environment where large, money center banks are entering the region with the dollars and the resources to buy market share.”
Premier Service Bank is a California state-chartered bank with two offices, its headquarters office in Riverside and a full-service banking office in Corona. The Bank provides commercial banking services, including a wide variety of checking accounts, investment services with competitive deposit rates, on-line banking products, and real estate, construction, commercial and consumer loans, to small and medium-sized businesses, professionals and individuals. Additional information about Premier Service Bank is available at its website at www.premierservicebank.com.
Forward-looking Statements
This news release contains statements that are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on current expectations, estimates and projections about Premier Service Bank’s business based, in part, on assumptions made by management. These statements are not guarantees of future performance and involve risks, uncertainties and assumptions that are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or forecasted in such forward-looking statements due to numerous factors, including those described above and in the following: Premier Service Bank’s ability to increase its assets, deposits and total loans, control expenses, retain critical personnel, manage interest rate risk, manage technological changes, address regulatory requirements, and other risks discussed from time to time in Premier Service Bank’s filings and reports with the Federal Deposit Insurance Corporation. In addition, such statements could be affected by general industry and market conditions and growth rates, and general domestic and international economic conditions. Such forward-looking statements speak only as of the date on which they are made, and Premier Service Bank does not undertake any obligation to update any forward-looking statement to reflect events or circumstances after the date of this release.
For a more complete discussion of risks and uncertainties, investors and security holders are urged to read Premier Service Bank’s annual report on Form 10-K, quarterly reports on Form 10-Q and other reports filed by Premier Service Bank with the FDIC.
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| Financial Data – Premier Service Bank | ||||||||||||||||||||||||||||||
| (Unaudited) | ||||||||||||||||||||||||||||||
| Quarter Ended | ||||||||||||||||||||||||||||||
| (In Thousands) | Dec. 31, 2011 | Sept. 30, 2011 | June 30, 2011 | Mar. 31, 2011 | Dec. 31, 2010 | |||||||||||||||||||||||||
| Interest income(not taxable equivalent) | $ | 1,750 | $ | 1,843 | $ | 1,959 | $ | 1,938 | $ | 2,063 | ||||||||||||||||||||
| Interest expense | 222 | 232 | 245 | 291 | 329 | |||||||||||||||||||||||||
| Net interest income | 1,528 | 1,611 | 1,714 | 1,647 | 1,734 | |||||||||||||||||||||||||
| Provision for loan losses | 910 | 275 | 884 | 725 | 960 | |||||||||||||||||||||||||
| Net interest income after provision for loan losses | 618 | 1,336 | 830 | 922 | 774 | |||||||||||||||||||||||||
| Non-interest income | 129 | 148 | 261 | 178 | 163 | |||||||||||||||||||||||||
| Non-interest expense | 1,566 | 1,625 | 1,722 | 1,694 | 1,644 | |||||||||||||||||||||||||
| Income before income taxes | (819 | ) | (141 | ) | (631 | ) | (594 | ) | (707 | ) | ||||||||||||||||||||
| (Benefit)/Provision for income taxes | 1 | - | - | - | - | |||||||||||||||||||||||||
| Net income | $ | (820 | ) | $ | (141 | ) | $ | (631 | ) | $ | (594 | ) | $ | (707 | ) | |||||||||||||||
| Quarter Ended | ||||||||||||||||||||||||||||||
| (In Thousands) | Dec. 31, 2011 | Sept. 30, 2011 | June 30, 2011 | Mar. 31, 2011 | Dec. 31, 2010 | |||||||||||||||||||||||||
| Per share: | ||||||||||||||||||||||||||||||
| Net income – basic | $ | (0.66 | ) | $ | (0.12 | ) | $ | (0.51 | ) | $ | (0.48 | ) | $ | (0.57 | ) | |||||||||||||||
| Weighted average shares used in basic | 1,261 | 1,261 | 1,261 | 1,261 | 1,261 | |||||||||||||||||||||||||
| Net income – diluted | $ | (0.66 | ) | $ | (0.12 | ) | $ | (0.51 | ) | $ | (0.48 | ) | $ | (0.57 | ) | |||||||||||||||
| Weighted average shares used in diluted | 1,261 | 1,261 | 1,261 | 1,261 | 1,261 | |||||||||||||||||||||||||
| Book value at period end | $ | 5.22 | $ | 5.89 | $ | 6.00 | $ | 6.49 | $ | 6.97 | ||||||||||||||||||||
| Ending shares | 1,261 | 1,261 | 1,261 | 1,261 | 1,261 | |||||||||||||||||||||||||
| Balance Sheet – At Period-End | ||||||||||||||||||||||||||||||
| Cash and due from banks | $ | 22,867 | $ | 21,875 | $ | 17,947 | $ | 22,636 | $ | 24,060 | ||||||||||||||||||||
| Investments and Fed fund sold | 8,446 | 7,724 | 9,766 | 10,250 | 8,476 | |||||||||||||||||||||||||
| Gross Loans | 103,668 | 109,429 | 111,500 | 113,645 | 117,624 | |||||||||||||||||||||||||
| Deferred fees | (198 | ) | (211 | ) | (233 | ) | (254 | ) | (263 | ) | ||||||||||||||||||||
| Allowance for loan losses | (2,359 | ) | (3,130 | ) | (2,803 | ) | (2,561 | ) | (2,549 | ) | ||||||||||||||||||||
| Net Loans | 101,111 | 106,088 | 108,464 | 110,830 | 114,812 | |||||||||||||||||||||||||
| Other assets | 8,832 | 9,398 | 10,559 | 10,592 | 8,644 | |||||||||||||||||||||||||
| Total Assets | $ | 141,256 | $ | 145,085 | $ | 146,736 | $ | 154,308 | $ | 155,992 | ||||||||||||||||||||
| Non-interest-bearing deposits | $ | 41,130 | $ | 43,246 | $ | 43,762 | $ | 44,947 | $ | 37,588 | ||||||||||||||||||||
| Interest-bearing deposits | 70,629 | 69,499 | 70,519 | 77,347 | 85,809 | |||||||||||||||||||||||||
| Other liabilities | 18,812 | 20,818 | 20,797 | 19,749 | 19,737 | |||||||||||||||||||||||||
| Shareholders’ equity | 10,685 | 11,522 | 11,658 | 12,265 | 12,858 | |||||||||||||||||||||||||
| Total Liabilities and Shareholders’ equity | $ | 141,256 | $ | 145,085 | $ | 146,736 | $ | 154,308 | $ | 155,992 | ||||||||||||||||||||
| Asset Quality & Capital – At Period-End | ||||||||||||||||||||||||||||||
| Non-accrual loans | $ | 8,926 | $ | 9,591 | $ | 6,309 | $ | 8,047 | $ | 8,209 | ||||||||||||||||||||
| Loans past due 90 days or more | - | - | - | - | - | |||||||||||||||||||||||||
| Other real estate owned | 2,927 | 3,194 | 4,036 | 3,927 | 1,865 | |||||||||||||||||||||||||
| Other bank owned assets | - | - | - | - | - | |||||||||||||||||||||||||
| Total non-performing assets | $ | 11,853 | $ | 12,785 | $ | 10,345 | $ | 11,974 | $ | 10,074 | ||||||||||||||||||||
| Allowance for losses to loans, gross | 2.28 | % | 2.86 | % | 2.51 | % | 2.25 | % | 2.17 | % | ||||||||||||||||||||
| Non-accrual loans to total loans, gross | 8.61 | % | 8.76 | % | 5.66 | % | 7.08 | % | 6.98 | % | ||||||||||||||||||||
| Non-performing loans to total loans, gross | 8.61 | % | 8.76 | % | 5.66 | % | 7.08 | % | 6.98 | % | ||||||||||||||||||||
| Non-performing asset to total assets | 8.39 | % | 8.81 | % | 7.05 | % | 7.76 | % | 6.46 | % | ||||||||||||||||||||
| Allowance for losses to non-performing loans | 26.43 | % | 32.63 | % | 44.43 | % | 31.83 | % | 31.05 | % | ||||||||||||||||||||
| Total risk-based capital ratio | 10.78 | % | 11.15 | % | 10.92 | % | 11.27 | % | 11.64 | % | ||||||||||||||||||||
| Tier 1 risk-based capital ratio | 9.52 | % | 9.88 | % | 9.66 | % | 10.00 | % | 10.38 | % | ||||||||||||||||||||
| Tier 1 leverage ratio | 7.21 | % | 7.86 | % | 7.73 | % | 7.87 | % | 8.05 | % | ||||||||||||||||||||
RED Finances $72 Million FHA Insured Sub Rehab Loan For Aimco Apartment Community In San Francisco Area
RT @McCormackJohn: RT @conncarroll Coward RT @philipaklein: Wow Newt snubs Weekly Standard’s @MichaelRWarren when he asks abt 09 support…
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Peter O'Malley teams with South Korea investor in bid for Dodgers
Peter O’Malley’s bid to buy back the Dodgers is supported by financing from the South Korean conglomerate E-Land, two people familiar with the Dodgers’ sale process said Monday.
If the O’Malley bid is successful, E-Land Chairman Song Soo Park will become a major investor in the Dodgers, one of the people said.
The ownership group also would have investors from Los Angeles. O’Malley has had discussions with Tony Ressler, a minority owner of the Milwaukee Brewers and co-founder of Los Angeles-based Ares Capital, according to a person familiar with the talks.
O’Malley would be the Dodgers’ chief executive. Foreign investment is not necessarily an obstacle to MLB ownership; the Seattle Mariners’ ownership group includes a significant Japanese presence.
An E-Land spokesman confirmed Tuesday the company is involved in the Dodgers bidding but would not elaborate. O’Malley declined to comment.
On Tuesday, as South Koreans woke up to the news that local investors might own one of America’s most storied baseball teams, the Korean Baseball Organization — the top professional league in South Korea — had no comment.
Among the baseball fans in chat rooms and on bulletin boards, the reaction leaned negative.
Rather than being proud of owning a foreign franchise as a way to extend Korean cultural and economic influence abroad, many fans here wondered why their moneyed elite didn’t invest their millions in Korean clubs. And, despite the experience of the Mariners, the fans expressed skepticism that foreign-backed ownership would be permitted.
“If an outsider could purchase a Major League Baseball team, then Chinese companies would’ve gotten their hands on it already,” wrote one bulletin board contributor.
Wrote another: “Why won’t they invest in finding a new Korean Baseball team instead?”
The people who liked the idea said it would pave the way for more Korean talent to make its way to the major leagues.
“Having a hand in the Dodgers will allow Korean players to more easily make the jump. It’s good marketing,” wrote one fan.
O’Malley is one of at least eight prospective owners to make last Friday’s first cut.
The others include East Coast investment baron Steven Cohen, St. Louis Rams owner Stan Kroenke, and groups led by Magic Johnson, Beverly Hills developer Alan Casden, Los Angeles developer Rick Caruso and former Dodgers manager Joe Torre, investor and civic leader Stanley Gold and the family of the late Roy Disney, and New York media investor Leo Hindery and investor Tom Barrack of Santa Monica-based Colony Capital.
Frank McCourt, the Dodgers’ departing owner, expects the team to sell for at least $1.5 billion. That would be almost double the previous record price for a major league club, set when the Ricketts family bought the Chicago Cubs for $845 million in 2009.
Under O’Malley, the Dodgers were pioneers in international baseball, particularly in Asia. In 1994, three years before O’Malley sold the team to News Corp., Dodgers pitcher Chan Ho Park became the first Korean player to appear in a major league game.
In November, O’Malley joined Park and former Dodgers pitcher Hideo Nomo — the second Japanese player to appear in the majors — in an investment partnership to own and operate the Dodgers’ old spring home in Vero Beach, Fla. Park and Nomo agreed to use their homeland connections to help lure teams, camps and clinics to Vero Beach.
E-Land, a dominant fashion retailer in South Korea, has expanded its business interests into such areas as hotels and resorts, restaurants and construction, according to the company website. The company is family-run and privately held.
According to the E-Land website, the company opened its first U.S. retail store in 2007 at a mall in Stamford, Conn., under the brand name “Who A.U.” The slogan for the brand: California Dream.
bill.shaikin@latimes.com
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Shaikin reported from Los Angeles and Glionna reported from Seoul.
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If the O’Malley bid is successful, E-Land Chairman Song Soo Park will become a major investor in the Dodgers, one of the people said.
The ownership group also would have investors from Los Angeles. O’Malley has had discussions with Tony Ressler, a minority owner of the Milwaukee Brewers and co-founder of Los Angeles-based Ares Capital, according to a person familiar with the talks.
O’Malley would be the Dodgers’ chief executive. Foreign investment is not necessarily an obstacle to MLB ownership; the Seattle Mariners’ ownership group includes a significant Japanese presence.
An E-Land spokesman confirmed Tuesday the company is involved in the Dodgers bidding but would not elaborate. O’Malley declined to comment.
On Tuesday, as South Koreans woke up to the news that local investors might own one of America’s most storied baseball teams, the Korean Baseball Organization — the top professional league in South Korea — had no comment.
Among the baseball fans in chat rooms and on bulletin boards, the reaction leaned negative.
Rather than being proud of owning a foreign franchise as a way to extend Korean cultural and economic influence abroad, many fans here wondered why their moneyed elite didn’t invest their millions in Korean clubs. And, despite the experience of the Mariners, the fans expressed skepticism that foreign-backed ownership would be permitted.
“If an outsider could purchase a Major League Baseball team, then Chinese companies would’ve gotten their hands on it already,” wrote one bulletin board contributor.
Wrote another: “Why won’t they invest in finding a new Korean Baseball team instead?”
The people who liked the idea said it would pave the way for more Korean talent to make its way to the major leagues.
“Having a hand in the Dodgers will allow Korean players to more easily make the jump. It’s good marketing,” wrote one fan.
O’Malley is one of at least eight prospective owners to make last Friday’s first cut.
The others include East Coast investment baron Steven Cohen, St. Louis Rams owner Stan Kroenke, and groups led by Magic Johnson, Beverly Hills developer Alan Casden, Los Angeles developer Rick Caruso and former Dodgers manager Joe Torre, investor and civic leader Stanley Gold and the family of the late Roy Disney, and New York media investor Leo Hindery and investor Tom Barrack of Santa Monica-based Colony Capital.
Frank McCourt, the Dodgers’ departing owner, expects the team to sell for at least $1.5 billion. That would be almost double the previous record price for a major league club, set when the Ricketts family bought the Chicago Cubs for $845 million in 2009.
Under O’Malley, the Dodgers were pioneers in international baseball, particularly in Asia. In 1994, three years before O’Malley sold the team to News Corp., Dodgers pitcher Chan Ho Park became the first Korean player to appear in a major league game.
In November, O’Malley joined Park and former Dodgers pitcher Hideo Nomo — the second Japanese player to appear in the majors — in an investment partnership to own and operate the Dodgers’ old spring home in Vero Beach, Fla. Park and Nomo agreed to use their homeland connections to help lure teams, camps and clinics to Vero Beach.
E-Land, a dominant fashion retailer in South Korea, has expanded its business interests into such areas as hotels and resorts, restaurants and construction, according to the company website. The company is family-run and privately held.
According to the E-Land website, the company opened its first U.S. retail store in 2007 at a mall in Stamford, Conn., under the brand name “Who A.U.” The slogan for the brand: California Dream.
bill.shaikin@latimes.com
twitter.com/BillShaikin
Shaikin reported from Los Angeles and Glionna reported from Seoul.
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Ryan Seacrest’s Company to Sell a Stake to Clear Channel
Ryan Seacrest, who already is a host, producer and spokesman for Clear Channel, will soon be an investment partner as well.
On Tuesday, the radio conglomerate is expected to announce its acquisition of a minority stake in Mr. Seacrest’s television and film production company, financing future growth and allowing for new collaborations between the two.
The investment in Mr. Seacrest — who will remain the main owner of Ryan Seacrest Productions — comes weeks after Clear Channel Radio renamed itself Clear Channel Media and Entertainment to promote its move into other media, including television.
Separately, the parties involved said, Mr. Seacrest also will work with the two private equity firms that own Clear Channel, Thomas H. Lee Partners and Bain Capital, to identify new investments and acquisitions. The firms have committed as much as $300 million to the initiative, which could focus on music publishers, technology makers or other companies. Mr. Seacrest will help the firms find opportunities and close deals.
The investments attest to the backstage business ambitions of Mr. Seacrest, who became famous a decade ago for hosting “American Idol” on Fox. While remaining a television and radio host, he is simultaneously building a diversified media company by linking up with companies like Clear Channel, the talent agency CAA and the events promoter AEG.
Mr. Seacrest said by telephone Monday night that the Clear Channel investment was an “efficient route for future growth” and said he would tap into the company’s marketing assets, including its many radio stations and Web sites.
Separately, in a deal with CAA and AEG that was announced this month, Mr. Seacrest will have a stake in AXS TV, a cable channel that will replace HDNet this summer.
The parties involved in Tuesday’s announcement would not disclose the size of Clear Channel’s investment in Mr. Seacrest’s production company, but it is expected to produce scripted and unscripted TV shows and other types of content for Clear Channel. Ryan Seacrest Productions currently makes “Keeping Up With the Kardashians” and related shows for E! and is preparing new reality shows for CMT and Bravo.
Robert Pittman, the chief executive of Clear Channel, praised Mr. Seacrest as a businessman and said the collaboration was a chance “to share in some of the success we think he’s going to have, and to enable some of it.”
Mr. Seacrest remains in talks with Comcast about an expanded relationship with its E! channel and other parts of NBCUniversal. Such an expansion could include a role on NBC’s “Today” show, prime-time specials and a presence on the company’s coverage of the Olympics.
A spokeswoman for Mr. Seacrest said that the Clear Channel investment would not preclude his productions for NBCUniversal or any other network or studio.
Once the negotiations with NBC conclude, Mr. Seacrest will still have at least one other bit of unfinished business: whether to renew his contract with “American Idol.” His current contract is set to expire this spring, and both he and Fox have signaled that he will probably remain on the show.
Cambrios Technologies Enters Strategic Growth Phase with New CEO, John LeMoncheck, and New Funding from Samsung …
SUNNYVALE, Calif.–(BUSINESS WIRE)– Cambrios Technologies Corporation, the leader in nanotechnology-based solutions to enable the development of electronic devices with transparent conductors, entered a new strategic phase today with the appointment of John LeMoncheck as President and CEO, and a $5 million Series D-3 financing round from Samsung Venture Investment Corporation. Both announcements advance Cambrios’ efforts to accelerate product introductions and commercial growth in multiple consumer electronic device markets. Dr. Michael R Knapp, Cambrios founding President and CEO, will become Chairman.
New President and CEO Brings Industry Leadership
“Adding John to the Cambrios executive team was the culmination of an extensive search led by previous CEO and now Chairman, Michael Knapp,” said Clint Bybee, current board member and managing partner at ARCH Venture Partners, an investor in Cambrios. “We welcome John and thank Mike for his leadership of the company, and for helping us recruit a world-class CEO to propel the next phase of Cambrios’ growth.”
LeMoncheck brings extensive expertise in the technology and consumer electronics industries and in forging commercial partnerships. Most recently, as President and CEO of SiBEAM, a pioneer in 60 GHz-based millimeter wave wireless technology, LeMoncheck developed the company into a leader in multi-gigabit communications for the consumer electronics market and successfully led the acquisition of the company by Silicon Image (NASDAQ: SIMG – News).
“John’s successful track record of collaborating with customers and developing essential industry-wide partnerships makes him the ideal candidate to lead and help cultivate new relationships for Cambrios,” said Dr. Leighton Read, current board member and a partner at Alloy Ventures, an investor in Cambrios.
“Cambrios has a unique opportunity resulting from its breakthroughs in the development of transparent conductor solutions with leading-edge optical and conductive properties,” said John LeMoncheck, Cambrios’ new president and CEO. “The company is poised to transform the touch, display, photovoltaic and lighting markets by enabling new and exciting consumer electronics applications. I look forward to working with the team to quickly make this a reality.”
New Investment Signals New Phase for Growth
Samsung Venture Investment Corporation’s investment of $5 million in series D-3 financing will be critical in the advancement of Cambrios’ objective to achieve commercial growth. Leading into this investment, Cambrios was in close discussions for collaboration on important and valuable projects with the Samsung Group over the past several years.
“This strategic partnership with Samsung Venture Investment Corporation offers the opportunity to increase the pace with which we can bring tangible, significant value to Samsung Group companies in their products,” said LeMoncheck. “This is a very important milestone for the overall penetration of ClearOhm™ materials in our target markets.”
Cambrios ClearOhm™ material, which can be purchased from the company as a coating material for plastic or glass, is currently the only product capable of providing the top tier performance required of today’s electronics products by helping manufacturers to consistently achieve better transmission and resistance than is possible with indium tin oxide (ITO). It can also be purchased as already deposited on PET film and others substrates or as a transfer film from several different optical film providers.
“Cambrios leads the market with the development of an alternative to vacuum-deposited ceramic materials such as ITO. It has built a significant business in developing ground-breaking products using nanotechnology,” said Dr. Dong Su Kim, Investment Director, Samsung Ventures, America. “John LeMoncheck’s excellent business vision and Cambrios’ technical accomplishments have led to innovative products that are critical to driving increased adoption of ClearOhm™ materials. We look forward to contributing to Cambrios’ continued progress in powering various consumer electronics applications with its ClearOhm™ technology.”
About John LeMoncheck
John LeMoncheck is a distinguished leader of both startups and public companies. Prior to SiBEAM, he was vice president of Consumer Electronics and PC/Display Products for Silicon Image, where he led to the company’s successful launch and commercialization of the HDMI standard, now used in over 2 billion devices as the preferred digital conductivity solution for consumer devices. Prior to Silicon Image, LeMoncheck was vice president of software and systems engineering at TeraLogic, subsequently purchased by Zoran and now owned by CSR. Prior to joining TeraLogic, LeMoncheck was a member of the founding team and vice president of engineering at Arithmos, Inc., which was successfully acquired by STMicroelectronics. LeMoncheck was also a member of technical staff at Synaptics, a leading developer of interface solutions for the mobile computing and entertainment industries. He has a bachelor’s degree in electrical engineering from U.C. San Diego and spent several years researching VLSI for imaging and pattern recognition applications at Caltech.
About Cambrios
Cambrios leads the industry in the development of proprietary, competitive products for consumer electronics markets using nanotechnology. Cambrios’ breakthroughs in nanotechnology-based transparent electrodes simplify electronics manufacturing processes and improve end-product performance for current and future next-generation consumer devices. The company’s first product, its ClearOhm™ coating material, produces a transparent, conductive film by wet processing and has significantly higher optical and electrical performance than currently used materials such as indium tin oxide and other transparent conductive oxides. Applications of ClearOhm™ coating material include transparent electrodes for touch screens, liquid crystal displays, e-paper, OLED devices, OLED lighting and thin film photovoltaics.
ClearOhm™ is a registered trademark of Cambrios Technologies Corporation.
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New President and CEO Brings Industry Leadership
“Adding John to the Cambrios executive team was the culmination of an extensive search led by previous CEO and now Chairman, Michael Knapp,” said Clint Bybee, current board member and managing partner at ARCH Venture Partners, an investor in Cambrios. “We welcome John and thank Mike for his leadership of the company, and for helping us recruit a world-class CEO to propel the next phase of Cambrios’ growth.”
LeMoncheck brings extensive expertise in the technology and consumer electronics industries and in forging commercial partnerships. Most recently, as President and CEO of SiBEAM, a pioneer in 60 GHz-based millimeter wave wireless technology, LeMoncheck developed the company into a leader in multi-gigabit communications for the consumer electronics market and successfully led the acquisition of the company by Silicon Image (NASDAQ: SIMG – News).
“John’s successful track record of collaborating with customers and developing essential industry-wide partnerships makes him the ideal candidate to lead and help cultivate new relationships for Cambrios,” said Dr. Leighton Read, current board member and a partner at Alloy Ventures, an investor in Cambrios.
“Cambrios has a unique opportunity resulting from its breakthroughs in the development of transparent conductor solutions with leading-edge optical and conductive properties,” said John LeMoncheck, Cambrios’ new president and CEO. “The company is poised to transform the touch, display, photovoltaic and lighting markets by enabling new and exciting consumer electronics applications. I look forward to working with the team to quickly make this a reality.”
New Investment Signals New Phase for Growth
Samsung Venture Investment Corporation’s investment of $5 million in series D-3 financing will be critical in the advancement of Cambrios’ objective to achieve commercial growth. Leading into this investment, Cambrios was in close discussions for collaboration on important and valuable projects with the Samsung Group over the past several years.
“This strategic partnership with Samsung Venture Investment Corporation offers the opportunity to increase the pace with which we can bring tangible, significant value to Samsung Group companies in their products,” said LeMoncheck. “This is a very important milestone for the overall penetration of ClearOhm™ materials in our target markets.”
Cambrios ClearOhm™ material, which can be purchased from the company as a coating material for plastic or glass, is currently the only product capable of providing the top tier performance required of today’s electronics products by helping manufacturers to consistently achieve better transmission and resistance than is possible with indium tin oxide (ITO). It can also be purchased as already deposited on PET film and others substrates or as a transfer film from several different optical film providers.
“Cambrios leads the market with the development of an alternative to vacuum-deposited ceramic materials such as ITO. It has built a significant business in developing ground-breaking products using nanotechnology,” said Dr. Dong Su Kim, Investment Director, Samsung Ventures, America. “John LeMoncheck’s excellent business vision and Cambrios’ technical accomplishments have led to innovative products that are critical to driving increased adoption of ClearOhm™ materials. We look forward to contributing to Cambrios’ continued progress in powering various consumer electronics applications with its ClearOhm™ technology.”
About John LeMoncheck
John LeMoncheck is a distinguished leader of both startups and public companies. Prior to SiBEAM, he was vice president of Consumer Electronics and PC/Display Products for Silicon Image, where he led to the company’s successful launch and commercialization of the HDMI standard, now used in over 2 billion devices as the preferred digital conductivity solution for consumer devices. Prior to Silicon Image, LeMoncheck was vice president of software and systems engineering at TeraLogic, subsequently purchased by Zoran and now owned by CSR. Prior to joining TeraLogic, LeMoncheck was a member of the founding team and vice president of engineering at Arithmos, Inc., which was successfully acquired by STMicroelectronics. LeMoncheck was also a member of technical staff at Synaptics, a leading developer of interface solutions for the mobile computing and entertainment industries. He has a bachelor’s degree in electrical engineering from U.C. San Diego and spent several years researching VLSI for imaging and pattern recognition applications at Caltech.
About Cambrios
Cambrios leads the industry in the development of proprietary, competitive products for consumer electronics markets using nanotechnology. Cambrios’ breakthroughs in nanotechnology-based transparent electrodes simplify electronics manufacturing processes and improve end-product performance for current and future next-generation consumer devices. The company’s first product, its ClearOhm™ coating material, produces a transparent, conductive film by wet processing and has significantly higher optical and electrical performance than currently used materials such as indium tin oxide and other transparent conductive oxides. Applications of ClearOhm™ coating material include transparent electrodes for touch screens, liquid crystal displays, e-paper, OLED devices, OLED lighting and thin film photovoltaics.
ClearOhm™ is a registered trademark of Cambrios Technologies Corporation.
Photos/Multimedia Gallery Available: http://www.businesswire.com/cgi-bin/mmg.cgi?eid=50147844&lang=en
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Will President Obama's Blueprint Cut College Costs?
Mark Kantrowitz is the founder of the Web sites finaid.org, and fastweb.com. He regularly answers reader questions on The Choice. Readers can post comments of their own at the end of this essay.
In his State of the Union address, President Obama announced several proposals to make college more affordable. These included doubling the number of federal work-study program jobs over five years, a one-year extension of low interest rates on certain federal student loans and a permanent extension of the American Opportunity Tax Credit. President Obama also “put colleges on notice,” telling the colleges that if they can’t stop tuition from going up, the financing they get from taxpayers each year will go down. The president also announced initiatives to help families make informed decisions concerning college costs and quality.
More money for college is better than none. As a nation, we must put a priority on increasing federal and state investment in higher education. Maintaining the status quo or making slight tweaks to student aid financing is not enough.
Yet a key concern is that increases in some student aid programs may come at the expense of cuts in other more effective student aid programs.
It is unclear how President Obama plans on paying for increases in student aid financing while Congress concentrates on cost-cutting. Congress cut $8 billion a year out of the Pell grant program last year by ending the year-round Pell grant program, which allowed students in accelerated degree programs to get two Pell grants in a single year. Congress reduced the income threshold at which a student qualifies for a full Pell grant from $32,000 to $23,000. This cuts the Pell grants by $1,100 to $1,700 for nearly 14 percent of Pell grant recipients. Additional cuts are looming on the horizon.
The tight federal budgets yield a zero-sum game, where increases in one form of federal student aid force cuts in other forms of student aid. Adding 700,000 more federal work-study jobs over five years will cost more than $1 billion a year.
But how will the Obama administration pay for a one-year extension of the 3.4 percent interest rate on subsidized Stafford loans for undergraduate students? Approximately 7.4 million students will borrow about $3,500 in subsidized Stafford loans on average, costing the federal government more than $7 billion. The permanent extension of the American Opportunity Tax Credit will add several billion dollars more a year in tax expenditures. If the Obama administration doesn’t find savings elsewhere in the budget, these spending increases will force cuts in the Pell grant program, causing declines in Bachelor’s degree attainment by low-income students. That would be a bad bargain.
The risk is that the proposals for increasing student aid financing may be little more than a shell game, where the federal government gives with one hand and takes back with the other. For example, President Obama’s proposal for a one-year delay in the doubling of interest on the subsidized Stafford loan program will be coupled with increases in interest rates on the Perkins loan program. The re-engineering of the Perkins loan program will increase the interest rate on the Perkins loan from 5 percent to 6.8 percent and transform the subsidized Perkins loan into an unsubsidized Stafford loan. (This will save students some money, by shifting borrowing from higher-cost private student loans to lower-cost federal education loans. But it still involves increasing some interest rates to reduce others). Shuffling the deck doesn’t yield a net gain if there is no improvement in college graduation rates or other public policy objectives.
If the federal government can pay for cutting the interest rates on subsidized Stafford loans in half, then why was it necessary to cut the average Pell grant? Changing the interest rates and subsidized interest benefits on student loans has no impact on college access and completion rates. In contrast, the Pell grant program enables low-income students to enroll in college and to graduate. Cutting Pell grant financing forces low-income students to borrow more, shift enrollment to lower-cost colleges or drop out of college. Increasing the interest rate is a better alternative than cutting the Pell grant.
President Obama’s proposal to provide colleges with an incentive to keep tuition affordable will have a modest impact on tuition inflation. The proposal will base a college’s allocation of federal campus-based aid on whether the college keeps net tuition affordable, limits tuition increases and helps low-income students to enroll and graduate. But the $10 billion in campus-based financing represents only about 6 percent of all federal student aid financing and the allocation formula is complicated. The prospect of losing this financing may force some colleges to increase tuition even faster to compensate for the loss of campus-based aid financing.
There are limits to the ability of colleges to control costs. The consumer inflation rate has little to do with increases in college costs. College costs are largely driven by increases in the number of faculty and staff, increases in salaries, increases in facility costs, energy costs, equipment costs and health care costs, increases in institutional financial aid financing and decreases in federal and state financing. For example, if a college has a discount rate of 37 percent, the college must increase tuition by $1.59 to net $1 in additional revenue. This contributes to college tuition increasing faster than inflation by adding a multiplier effect.
President Obama’s proposal to create a mandatory “Financial Aid Shopping Sheet” and “College Scorecard”, on the other hand, will do more to constrain increases in college costs. This standardization of college cost and financial aid disclosures will provide families with clear, correct and comparable information about the real bottom-line cost of college.
This will help them make informed decisions concerning the tradeoffs between college affordability and other factors in college choice. More families will choose high quality but lower-cost colleges, forcing colleges to cut costs while maintaining or improving quality.
Now it’s your turn, Choice readers. Tell us your opinion on the president’s proposal, or at least Mr. Kantrowitz’s analysis of it, by using the box below.
http://tourism9.com/ http://vkins.com/
In his State of the Union address, President Obama announced several proposals to make college more affordable. These included doubling the number of federal work-study program jobs over five years, a one-year extension of low interest rates on certain federal student loans and a permanent extension of the American Opportunity Tax Credit. President Obama also “put colleges on notice,” telling the colleges that if they can’t stop tuition from going up, the financing they get from taxpayers each year will go down. The president also announced initiatives to help families make informed decisions concerning college costs and quality.
More money for college is better than none. As a nation, we must put a priority on increasing federal and state investment in higher education. Maintaining the status quo or making slight tweaks to student aid financing is not enough.
Yet a key concern is that increases in some student aid programs may come at the expense of cuts in other more effective student aid programs.
It is unclear how President Obama plans on paying for increases in student aid financing while Congress concentrates on cost-cutting. Congress cut $8 billion a year out of the Pell grant program last year by ending the year-round Pell grant program, which allowed students in accelerated degree programs to get two Pell grants in a single year. Congress reduced the income threshold at which a student qualifies for a full Pell grant from $32,000 to $23,000. This cuts the Pell grants by $1,100 to $1,700 for nearly 14 percent of Pell grant recipients. Additional cuts are looming on the horizon.
The tight federal budgets yield a zero-sum game, where increases in one form of federal student aid force cuts in other forms of student aid. Adding 700,000 more federal work-study jobs over five years will cost more than $1 billion a year.
But how will the Obama administration pay for a one-year extension of the 3.4 percent interest rate on subsidized Stafford loans for undergraduate students? Approximately 7.4 million students will borrow about $3,500 in subsidized Stafford loans on average, costing the federal government more than $7 billion. The permanent extension of the American Opportunity Tax Credit will add several billion dollars more a year in tax expenditures. If the Obama administration doesn’t find savings elsewhere in the budget, these spending increases will force cuts in the Pell grant program, causing declines in Bachelor’s degree attainment by low-income students. That would be a bad bargain.
The risk is that the proposals for increasing student aid financing may be little more than a shell game, where the federal government gives with one hand and takes back with the other. For example, President Obama’s proposal for a one-year delay in the doubling of interest on the subsidized Stafford loan program will be coupled with increases in interest rates on the Perkins loan program. The re-engineering of the Perkins loan program will increase the interest rate on the Perkins loan from 5 percent to 6.8 percent and transform the subsidized Perkins loan into an unsubsidized Stafford loan. (This will save students some money, by shifting borrowing from higher-cost private student loans to lower-cost federal education loans. But it still involves increasing some interest rates to reduce others). Shuffling the deck doesn’t yield a net gain if there is no improvement in college graduation rates or other public policy objectives.
If the federal government can pay for cutting the interest rates on subsidized Stafford loans in half, then why was it necessary to cut the average Pell grant? Changing the interest rates and subsidized interest benefits on student loans has no impact on college access and completion rates. In contrast, the Pell grant program enables low-income students to enroll in college and to graduate. Cutting Pell grant financing forces low-income students to borrow more, shift enrollment to lower-cost colleges or drop out of college. Increasing the interest rate is a better alternative than cutting the Pell grant.
President Obama’s proposal to provide colleges with an incentive to keep tuition affordable will have a modest impact on tuition inflation. The proposal will base a college’s allocation of federal campus-based aid on whether the college keeps net tuition affordable, limits tuition increases and helps low-income students to enroll and graduate. But the $10 billion in campus-based financing represents only about 6 percent of all federal student aid financing and the allocation formula is complicated. The prospect of losing this financing may force some colleges to increase tuition even faster to compensate for the loss of campus-based aid financing.
There are limits to the ability of colleges to control costs. The consumer inflation rate has little to do with increases in college costs. College costs are largely driven by increases in the number of faculty and staff, increases in salaries, increases in facility costs, energy costs, equipment costs and health care costs, increases in institutional financial aid financing and decreases in federal and state financing. For example, if a college has a discount rate of 37 percent, the college must increase tuition by $1.59 to net $1 in additional revenue. This contributes to college tuition increasing faster than inflation by adding a multiplier effect.
President Obama’s proposal to create a mandatory “Financial Aid Shopping Sheet” and “College Scorecard”, on the other hand, will do more to constrain increases in college costs. This standardization of college cost and financial aid disclosures will provide families with clear, correct and comparable information about the real bottom-line cost of college.
This will help them make informed decisions concerning the tradeoffs between college affordability and other factors in college choice. More families will choose high quality but lower-cost colleges, forcing colleges to cut costs while maintaining or improving quality.
Now it’s your turn, Choice readers. Tell us your opinion on the president’s proposal, or at least Mr. Kantrowitz’s analysis of it, by using the box below.
http://tourism9.com/ http://vkins.com/
LED Innovator Relume Technologies Closes $7M Financing Round
OXFORD — Relume Technologies, a manufacturer of light-emitting diode (LED) products and smart grid control systems for outdoor lighting, has closed its $7 million Series D financing round.
Farmington Hills-based Beringea, which led the round, invested $3.2 million. San Jose, Calif.-based Western Technology Investment and other existing investors comprised the remainder of the round.
“Relume has seen tremendous growth over the past year, as evidenced by recent sales in multiple municipalities, new product launches and several key additions to our engineering team,” said Crawford Lipsey, CEO for Relume. “These funds will allow us to build up our sales and manufacturing infrastructure and further expand our team.”
Relume’s LED products and lighting control systems are used in street and area lighting, commercial signage, outdoor advertising, transportation and U.S. military applications and improve a city’s operating costs, commerce and resident safety. Relume’s LED luminaries feature superior thermal management and low LED junction temperatures — key to long LED life — and enabling Relume to offer a market-leading 7-year product warranty.
“Relume is growing rapidly — it roughly doubled its revenue in 2011 — and through its innovative technology and world-class management team, Relume is poised to secure a dominant position in the outdoor LED lighting market,” said Jeff Bocan, managing director for Beringea.
“Given the company’s marquee customer base and accelerating sales traction, WTI is pleased to support Relume’s impressive ongoing growth,” said Maurice Werdegar, partner of Western Technology Investment.
Relume has installed outdoor lighting solutions in more than 1,000 outdoor facilities, producing up to a 50 percent energy savings per product. The company’s customers include Starbucks Coffee, US Cellular, McDonalds, Chase, Best Buy, and Lexus, among others. In addition, Relume has re-lit many cities across the country, including Ann Arbor; Arlington, Va.; Canton, Ohio, and West Nottingham Township, Pennsylvania.
Relume’s products are also American-made and ISO 9001:2008 certified.
Relume is a founding member of the Michigan Solid State Lighting Association, and supports the organization’s mission of ensuring that Michigan is a global leader in solid-state lighting, research and development, and manufacturing. Relume was recently recognized as one of Michigan’s 50 Companies to Watch by the Edward Lowe Foundation. For more information, visit www.relume.com.
More about Beringea, Michigan’s largest private capital company, at http://www.beringea.com/.
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Farmington Hills-based Beringea, which led the round, invested $3.2 million. San Jose, Calif.-based Western Technology Investment and other existing investors comprised the remainder of the round.
“Relume has seen tremendous growth over the past year, as evidenced by recent sales in multiple municipalities, new product launches and several key additions to our engineering team,” said Crawford Lipsey, CEO for Relume. “These funds will allow us to build up our sales and manufacturing infrastructure and further expand our team.”
Relume’s LED products and lighting control systems are used in street and area lighting, commercial signage, outdoor advertising, transportation and U.S. military applications and improve a city’s operating costs, commerce and resident safety. Relume’s LED luminaries feature superior thermal management and low LED junction temperatures — key to long LED life — and enabling Relume to offer a market-leading 7-year product warranty.
“Relume is growing rapidly — it roughly doubled its revenue in 2011 — and through its innovative technology and world-class management team, Relume is poised to secure a dominant position in the outdoor LED lighting market,” said Jeff Bocan, managing director for Beringea.
“Given the company’s marquee customer base and accelerating sales traction, WTI is pleased to support Relume’s impressive ongoing growth,” said Maurice Werdegar, partner of Western Technology Investment.
Relume has installed outdoor lighting solutions in more than 1,000 outdoor facilities, producing up to a 50 percent energy savings per product. The company’s customers include Starbucks Coffee, US Cellular, McDonalds, Chase, Best Buy, and Lexus, among others. In addition, Relume has re-lit many cities across the country, including Ann Arbor; Arlington, Va.; Canton, Ohio, and West Nottingham Township, Pennsylvania.
Relume’s products are also American-made and ISO 9001:2008 certified.
Relume is a founding member of the Michigan Solid State Lighting Association, and supports the organization’s mission of ensuring that Michigan is a global leader in solid-state lighting, research and development, and manufacturing. Relume was recently recognized as one of Michigan’s 50 Companies to Watch by the Edward Lowe Foundation. For more information, visit www.relume.com.
More about Beringea, Michigan’s largest private capital company, at http://www.beringea.com/.
http://tourism9.com/ http://vkins.com/
2012年1月30日星期一
Chief Economist: MENA Will Stand Stronger by the End of 2012
COPENHAGEN, DENMARK–(Marketwire -01/30/12)- Steen Jakobsen, Chief Economist at Saxo Bank A/S, the online trading and investment specialist, will be visiting Dubai to discuss with financial media and professional investors of Saxo Bank (Dubai) Ltd, a wholly owned subsidiary of Saxo Bank A/S, the current market status in light of the recent crisis and the Bank’s outlook for the first quarter of 2012.
Saxo Bank’s quarterly outlook takes a deeper look at what 2012 holds for various asset classes including; foreign exchange, commodities and equities and the state of the macro economy and how it will be impacted by policy amendments, monetary policy and the current market turmoil. The bank has forecasted that world growth is to slow further in 2012 to 3 percent. Mr. Jakobsen says: “Our common theme for this quarter is a Perfect Storm. Pressures in the Eurozone, public sector austerity and social tensions will all conspire to create the storm, in which no nation will be left untouched”.
He believes 2012 could be the most pivotal year by far since the global financial crisis of 2008 and notes that a perfect storm in the Middle East and North Africa (MENA) area is based on good underlying fundamentals combined with almost imperfect visibility on geopolitical risk.
Mr. Jakobsen says: “We feel confident that MENA will stand stronger on both accounts at the end of 2012 but first we may need to go through a period of increased volatility. This leads us to a very defensive investment outlook not from a fear of the future rather from a high probability of seeing better entry levels during the course of the year.”
Steen Jakobsen, a regular guest host and commentator on CNBC, Bloomberg and other networks, has more than 20 years of experience within the fields of proprietary trading and alternative investment. In 1997, he became Global Head of Trading, FX and Options at Christiania (now Nordea) in New York until he joined UBS in New York in 1999 as the Executive Director in the Global Proprietary Trading Group. He joined Saxo Bank in 2000 and after a brief departure to Limus Capital Partners, where he was Chief Investment Officer for two years, he returned to the bank in 2011 as Chief Economist.
About Saxo Bank (Dubai) LtdSaxo Bank (Dubai) Limited is a wholly owned subsidiary of Saxo Bank A/S. Saxo Bank (Dubai) Limited is pleased to offer access to Saxo Bank A/S’s award-winning trading platforms here in the Middle East. Saxo Bank (Dubai) Ltd is regulated by the Dubai Financial Services Authority (DFSA) and services Professional Clients only.
About Saxo Bank A/SSaxo Bank is a leading online trading and investment specialist. A fully licensed and regulated European bank, Saxo Bank enables private investors and institutional clients to trade FX, CFDs, ETFs, Stocks, Futures, Options and other derivatives via three specialised and fully integrated trading platforms; the browser-based SaxoWebTrader, the downloadable SaxoTrader and the SaxoMobileTrader application available in over 20 languages. Saxo Bank also offers professional portfolio and fund management through Saxo Asset Management who accommodates high-net worth private clients and institutional investors and provides banking services and advice to retail clients through Saxo Privatbank. The Saxo Bank Group is headquartered in Copenhagen with offices throughout Europe, Asia, Middle East, Latin America and Australia.
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Saxo Bank’s quarterly outlook takes a deeper look at what 2012 holds for various asset classes including; foreign exchange, commodities and equities and the state of the macro economy and how it will be impacted by policy amendments, monetary policy and the current market turmoil. The bank has forecasted that world growth is to slow further in 2012 to 3 percent. Mr. Jakobsen says: “Our common theme for this quarter is a Perfect Storm. Pressures in the Eurozone, public sector austerity and social tensions will all conspire to create the storm, in which no nation will be left untouched”.
He believes 2012 could be the most pivotal year by far since the global financial crisis of 2008 and notes that a perfect storm in the Middle East and North Africa (MENA) area is based on good underlying fundamentals combined with almost imperfect visibility on geopolitical risk.
Mr. Jakobsen says: “We feel confident that MENA will stand stronger on both accounts at the end of 2012 but first we may need to go through a period of increased volatility. This leads us to a very defensive investment outlook not from a fear of the future rather from a high probability of seeing better entry levels during the course of the year.”
Steen Jakobsen, a regular guest host and commentator on CNBC, Bloomberg and other networks, has more than 20 years of experience within the fields of proprietary trading and alternative investment. In 1997, he became Global Head of Trading, FX and Options at Christiania (now Nordea) in New York until he joined UBS in New York in 1999 as the Executive Director in the Global Proprietary Trading Group. He joined Saxo Bank in 2000 and after a brief departure to Limus Capital Partners, where he was Chief Investment Officer for two years, he returned to the bank in 2011 as Chief Economist.
About Saxo Bank (Dubai) LtdSaxo Bank (Dubai) Limited is a wholly owned subsidiary of Saxo Bank A/S. Saxo Bank (Dubai) Limited is pleased to offer access to Saxo Bank A/S’s award-winning trading platforms here in the Middle East. Saxo Bank (Dubai) Ltd is regulated by the Dubai Financial Services Authority (DFSA) and services Professional Clients only.
About Saxo Bank A/SSaxo Bank is a leading online trading and investment specialist. A fully licensed and regulated European bank, Saxo Bank enables private investors and institutional clients to trade FX, CFDs, ETFs, Stocks, Futures, Options and other derivatives via three specialised and fully integrated trading platforms; the browser-based SaxoWebTrader, the downloadable SaxoTrader and the SaxoMobileTrader application available in over 20 languages. Saxo Bank also offers professional portfolio and fund management through Saxo Asset Management who accommodates high-net worth private clients and institutional investors and provides banking services and advice to retail clients through Saxo Privatbank. The Saxo Bank Group is headquartered in Copenhagen with offices throughout Europe, Asia, Middle East, Latin America and Australia.
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Saxo Capital Markets Launches Australian Retail Operations
SYDNEY, January 30, 2012 /PRNewswire/ –
Saxo Capital Markets (Australia) Pty Ltd (‘SCM Australia‘) , the online trading and investment specialist, today announced the launch of its retail operations in Australia, offering investors the opportunity to trade thousands of asset classes across award-winning online platforms.
Saxo Capital Markets (Australia) Pty Ltd is a wholly-owned subsidiary of Saxo Bank A/S. It holds an Australian Financial Services Licence 280372 and is regulated by the Australian Securities & Investments Commission.
The move extends Saxo Bank Group’s reach in the fast-growing Asia-Pacific, and is consistent with its goal of being the premier multi-asset online trading platform in the world.
SCM Australia offers local traders sophisticated trading platforms such as SaxoTrader and SaxoWebTrader, permitting the trading of foreign exchange, CFDs and stocks with live streaming prices and lightning-fast stock trades. SCM Australia provides clients with access to over 160 foreign exchange crosses, more than 13,000 stocks from 25 major exchanges and over 140 Futures contracts on live market prices from over 19 exchanges. SCM Australia’s CEO Anthony Griffin said the company believed it had the services and competitive offering to transform the online trading market in Australia.
Mr Griffin states, “In Australia, we will be adopting the standard Saxo business model that has been successfully implemented in over 20 countries and bringing our award-winning platforms to the market.”
Further, he states, “it was critical to ensure that investors were educated as much as possible on the asset classes they were trading in and the risks involved. As a result, SCM has a number of online educational tools available to ensure investors are informed.”
SCM Australia recently completed the acquisition of Logos Commodities Pty Ltd, the holding company of Commodity Broking Services Pty Ltd, bringing with it an excellent client base and broadening its suite of services.
Kim Fournais and Lars Seier Christensen, co-founders and CEOs of Saxo Bank, said in a joint statement:
“While opening an office in Sydney is a strategic decision to support our Asia-Pacific expansion and growth strategy, it has always been a priority for Saxo Bank. The acquisition has brought with it both tremendous staff as well as a great range of clients. That has given us the critical mass for doing business here. This is a good time for us to prove our commitment to the Australian market.”
Saxo Bank was founded in 1992. Saxo Bank’s trading platforms have defined the company’s success in the online trading space for over a decade. Since introducing the SaxoTrader in 1998, Saxo Bank has enhanced and improved its platforms to meet the evolving needs of traders and investors in a continuously changing industry. The Group has expanded overseas since 2006 and now has operations in more than 20 countries including major financial centres such as Tokyo, Singapore, Hong Kong, London, Zurich, Dubai, and Paris.
Disclaimer:
Saxo Capital Markets (Australia) Pty Ltd is a wholly-owned subsidiary of Saxo Bank A/S, the Copenhagen-headquartered online trading and investment specialist. It holds an Australian Financial Services Licence 280372 and is regulated by the Australian Securities & Investments Commission. Leveraged investments in foreign exchange or derivatives carry a high degree of risk and may result in significant gains or losses. You should carefully consider your financial situation and consult your independent financial advisors as to the suitability of your situation prior to making any investments. For further information, please see: http://au.saxomarkets.com/about-us/general-disclaimer
About Saxo Capital Markets (Australia) Pty Ltd
Saxo Capital Markets (Australia) Pty Ltd is a wholly-owned subsidiary of Saxo Bank A/S, the Copenhagen-headquartered online trading and investment specialist. It holds an Australian Financial Services Licence and is regulated by the Australian Securities & Investments Commission. Clients can trade Forex, CFDs, Stocks, Futures, Options and other derivatives via SaxoWebTrader and SaxoTrader, its leading multi-asset online trading platforms. SaxoTrader is available directly through Saxo Capital Markets or through one of its institutional clients. White labelling is a significant business area for Saxo Capital Markets, and involves customising and branding of its online trading platform for other financial institutions and brokers.
For more information, please visit http://www.saxomarkets.com.au/
http://tourism9.com/ http://vkins.com/
Saxo Capital Markets (Australia) Pty Ltd (‘SCM Australia‘) , the online trading and investment specialist, today announced the launch of its retail operations in Australia, offering investors the opportunity to trade thousands of asset classes across award-winning online platforms.
Saxo Capital Markets (Australia) Pty Ltd is a wholly-owned subsidiary of Saxo Bank A/S. It holds an Australian Financial Services Licence 280372 and is regulated by the Australian Securities & Investments Commission.
The move extends Saxo Bank Group’s reach in the fast-growing Asia-Pacific, and is consistent with its goal of being the premier multi-asset online trading platform in the world.
SCM Australia offers local traders sophisticated trading platforms such as SaxoTrader and SaxoWebTrader, permitting the trading of foreign exchange, CFDs and stocks with live streaming prices and lightning-fast stock trades. SCM Australia provides clients with access to over 160 foreign exchange crosses, more than 13,000 stocks from 25 major exchanges and over 140 Futures contracts on live market prices from over 19 exchanges. SCM Australia’s CEO Anthony Griffin said the company believed it had the services and competitive offering to transform the online trading market in Australia.
Mr Griffin states, “In Australia, we will be adopting the standard Saxo business model that has been successfully implemented in over 20 countries and bringing our award-winning platforms to the market.”
Further, he states, “it was critical to ensure that investors were educated as much as possible on the asset classes they were trading in and the risks involved. As a result, SCM has a number of online educational tools available to ensure investors are informed.”
SCM Australia recently completed the acquisition of Logos Commodities Pty Ltd, the holding company of Commodity Broking Services Pty Ltd, bringing with it an excellent client base and broadening its suite of services.
Kim Fournais and Lars Seier Christensen, co-founders and CEOs of Saxo Bank, said in a joint statement:
“While opening an office in Sydney is a strategic decision to support our Asia-Pacific expansion and growth strategy, it has always been a priority for Saxo Bank. The acquisition has brought with it both tremendous staff as well as a great range of clients. That has given us the critical mass for doing business here. This is a good time for us to prove our commitment to the Australian market.”
Saxo Bank was founded in 1992. Saxo Bank’s trading platforms have defined the company’s success in the online trading space for over a decade. Since introducing the SaxoTrader in 1998, Saxo Bank has enhanced and improved its platforms to meet the evolving needs of traders and investors in a continuously changing industry. The Group has expanded overseas since 2006 and now has operations in more than 20 countries including major financial centres such as Tokyo, Singapore, Hong Kong, London, Zurich, Dubai, and Paris.
Disclaimer:
Saxo Capital Markets (Australia) Pty Ltd is a wholly-owned subsidiary of Saxo Bank A/S, the Copenhagen-headquartered online trading and investment specialist. It holds an Australian Financial Services Licence 280372 and is regulated by the Australian Securities & Investments Commission. Leveraged investments in foreign exchange or derivatives carry a high degree of risk and may result in significant gains or losses. You should carefully consider your financial situation and consult your independent financial advisors as to the suitability of your situation prior to making any investments. For further information, please see: http://au.saxomarkets.com/about-us/general-disclaimer
About Saxo Capital Markets (Australia) Pty Ltd
Saxo Capital Markets (Australia) Pty Ltd is a wholly-owned subsidiary of Saxo Bank A/S, the Copenhagen-headquartered online trading and investment specialist. It holds an Australian Financial Services Licence and is regulated by the Australian Securities & Investments Commission. Clients can trade Forex, CFDs, Stocks, Futures, Options and other derivatives via SaxoWebTrader and SaxoTrader, its leading multi-asset online trading platforms. SaxoTrader is available directly through Saxo Capital Markets or through one of its institutional clients. White labelling is a significant business area for Saxo Capital Markets, and involves customising and branding of its online trading platform for other financial institutions and brokers.
For more information, please visit http://www.saxomarkets.com.au/
http://tourism9.com/ http://vkins.com/
Venture Capital Investment in Europe Fell 14% in 2011
LONDON, Jan. 30, 2012 /PRNewswire/ – Venture capitalists put euro 4.4 billion into 1,012 deals for European companies in 2011, a 14% decline in investment and 19% decline in deal flow from 2010, according to Dow Jones VentureSource. This marks the lowest annual deal count for Europe since VentureSource began tracking the region in 2000.
The fourth quarter was the weakest of the year in terms of deal activity as 194 deals collected euro 1.1 billion, a 43% drop in deals and 38% decline in investment over the same period in 2010. Weakness in the fourth quarter is notable as it is traditionally one of the most active quarters for deals.
“Venture capitalists are having difficulty raising funds as the Euro crisis weighs on limited partners’ minds and fewer companies are finding exits. This has naturally led to a slowdown in investment. With less capital flowing into venture firms, there’s less to invest in start-ups,” said Anthony Sheldon, research manager, Dow Jones VentureSource. The median size of a European venture capital deal was euro 2 million in 2011, on par with 2010.
Exits Mirror Fourth-Quarter Drop in Investment
The fourth quarter’s weakness in investments mirrored the exit environment. The fourth quarter of 2011 was the year’s weakest for mergers and acquisitions (M&As) and initial public offerings (IPOs) as 30 European venture-backed companies were acquired and two companies went public.
In all of 2011, 148 companies exited via an M&A, raising euro 7 billion, a 12% decline in deals and 7% increase in capital raised. Companies that got acquired, however, recorded the highest median raised on record. The median paid for an acquisition in 2011 was euro 5.1 million.
In all of 2011, 14 venture-backed companies went public, raising euro 695 million, a drop in IPOs but an increase in capital raised from 2010 when 18 IPOs raised euro 438 million.
As VCs Focus on Web, Consumer Services Investment Passes IT for First Time Since 2001
For the first time since 2001, the Web-heavy Consumer Services industry raised more capital than the Information Technology (IT) industry. Consumer Services companies raised euro 1.1 billion for 223 deals in 2011, a 63% increase in investment despite a 6% drop in deals from 2010. It was the industry’s strongest year for investment since 2001. IT companies raised $812 million for 270 deals in 2011, a 50% decline in investment and 25% decline in deals.
More than half of the capital collected by the Consumer Services industry went to the social media, entertainment and shopping companies in the Consumer Information Services sector. Those companies raised euro 691 million for 192 deals, a 79% increase in investment despite an 8% decline in deals.
Within the IT industry, Software remained the most popular investment area, driven by interest in business applications software and communications software. The Software sector raised euro 467 million through 194 deals in 2011, a 14% decline in investment and 13% decline in deal activity.
Medical Devices Offers Some Stability in Healthcare
As deal activity and investment fell in all areas of Healthcare, the Medical Devices sector offered moderate stability, seeing a drop of just 7% in both deal activity and investment. Medical Devices companies raised euro 323 million for 91 deals in 2011, a mild decline from the euro 348 million raised for 98 deals in 2010.
As usual, Biopharmaceuticals took the lion’s share of the industry’s investment as 121 deals raised euro 856 million, a 29% decline in deals and 20% decline in investment.
Uptick in Deals for Advertising, Data Companies
The Business Support Services sector, which includes companies developing technologies and services for data management, advertising and marketing, was the only sector to see an uptick in both deals and investment in 2011. The sector raised euro 479 million for 90 deals, a 62% increase in investment and 5% increase in deals.
The broader Business and Financial Services industry, which includes the Business Support Services sector as well as financial services and engineering companies, raised euro 614 million for 132 deals, a 15% increase in capital invested despite a 12% decline in investment.
Companies Focused on Renewables Capture Most Energy Investment
In 2011, 56 deals in the Energy & Utilities industry raised euro 253 million, a 26% decline in deals and 25% decline in investment. Renewable Energy companies accounted for most of the industry’s investment, raising euro 238 million for 49 deals.
Country Perspectives
Europe’s four major countries for venture investment – the U.K., France, Germany and Sweden – witnessed record-low deal activity in 2011.
About Dow JonesDow Jones & Company is a global provider of news and business information and a developer of technology to deliver content to consumers and organizations across multiple platforms. Dow Jones produces newspapers, newswires, Web sites, apps, newsletters, magazines, proprietary databases, conferences, radio and video. Its premier brands include The Wall Street Journal, Dow Jones Newswires, Factiva, Barron’s, MarketWatch, SmartMoney and All Things D. Its information services combine technology with news and data to support business decision making. The company pioneered the first successful paid online news site and its industry leading innovation enables it to serve customers wherever they may be, via the Web, mobile devices and tablets. The Dow Jones Local Media Group publishes community newspapers, Web sites and other products in six U.S. states. Dow Jones & Company (www.dowjones.com) is a News Corporation company (NASDAQ: NWS, NWSA; ASX: NWS, NWSLV; http://www.newscorp.com/).
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The fourth quarter was the weakest of the year in terms of deal activity as 194 deals collected euro 1.1 billion, a 43% drop in deals and 38% decline in investment over the same period in 2010. Weakness in the fourth quarter is notable as it is traditionally one of the most active quarters for deals.
“Venture capitalists are having difficulty raising funds as the Euro crisis weighs on limited partners’ minds and fewer companies are finding exits. This has naturally led to a slowdown in investment. With less capital flowing into venture firms, there’s less to invest in start-ups,” said Anthony Sheldon, research manager, Dow Jones VentureSource. The median size of a European venture capital deal was euro 2 million in 2011, on par with 2010.
Exits Mirror Fourth-Quarter Drop in Investment
The fourth quarter’s weakness in investments mirrored the exit environment. The fourth quarter of 2011 was the year’s weakest for mergers and acquisitions (M&As) and initial public offerings (IPOs) as 30 European venture-backed companies were acquired and two companies went public.
In all of 2011, 148 companies exited via an M&A, raising euro 7 billion, a 12% decline in deals and 7% increase in capital raised. Companies that got acquired, however, recorded the highest median raised on record. The median paid for an acquisition in 2011 was euro 5.1 million.
In all of 2011, 14 venture-backed companies went public, raising euro 695 million, a drop in IPOs but an increase in capital raised from 2010 when 18 IPOs raised euro 438 million.
As VCs Focus on Web, Consumer Services Investment Passes IT for First Time Since 2001
For the first time since 2001, the Web-heavy Consumer Services industry raised more capital than the Information Technology (IT) industry. Consumer Services companies raised euro 1.1 billion for 223 deals in 2011, a 63% increase in investment despite a 6% drop in deals from 2010. It was the industry’s strongest year for investment since 2001. IT companies raised $812 million for 270 deals in 2011, a 50% decline in investment and 25% decline in deals.
More than half of the capital collected by the Consumer Services industry went to the social media, entertainment and shopping companies in the Consumer Information Services sector. Those companies raised euro 691 million for 192 deals, a 79% increase in investment despite an 8% decline in deals.
Within the IT industry, Software remained the most popular investment area, driven by interest in business applications software and communications software. The Software sector raised euro 467 million through 194 deals in 2011, a 14% decline in investment and 13% decline in deal activity.
Medical Devices Offers Some Stability in Healthcare
As deal activity and investment fell in all areas of Healthcare, the Medical Devices sector offered moderate stability, seeing a drop of just 7% in both deal activity and investment. Medical Devices companies raised euro 323 million for 91 deals in 2011, a mild decline from the euro 348 million raised for 98 deals in 2010.
As usual, Biopharmaceuticals took the lion’s share of the industry’s investment as 121 deals raised euro 856 million, a 29% decline in deals and 20% decline in investment.
Uptick in Deals for Advertising, Data Companies
The Business Support Services sector, which includes companies developing technologies and services for data management, advertising and marketing, was the only sector to see an uptick in both deals and investment in 2011. The sector raised euro 479 million for 90 deals, a 62% increase in investment and 5% increase in deals.
The broader Business and Financial Services industry, which includes the Business Support Services sector as well as financial services and engineering companies, raised euro 614 million for 132 deals, a 15% increase in capital invested despite a 12% decline in investment.
Companies Focused on Renewables Capture Most Energy Investment
In 2011, 56 deals in the Energy & Utilities industry raised euro 253 million, a 26% decline in deals and 25% decline in investment. Renewable Energy companies accounted for most of the industry’s investment, raising euro 238 million for 49 deals.
Country Perspectives
Europe’s four major countries for venture investment – the U.K., France, Germany and Sweden – witnessed record-low deal activity in 2011.
- The U.K. remained the favorite destination for venture capital investment in Europe in 2011. Companies in the U.K. raised euro 1.2 billion for 274 deals, a 36% decline in investment and 17% decline in deals.
- France came in second place as companies raised euro 728 million for 217 deals, a 15% decline in investment and 18% decline in deals.
- Germany came in third as companies raised euro 475 million for 120 deals, a 23% decline in investment and 26% decline in deals.
- Sweden came in fourth as companies raised euro 299 million for 67 deals, a 7% increase in investment despite a 36% decline in deals.
About Dow JonesDow Jones & Company is a global provider of news and business information and a developer of technology to deliver content to consumers and organizations across multiple platforms. Dow Jones produces newspapers, newswires, Web sites, apps, newsletters, magazines, proprietary databases, conferences, radio and video. Its premier brands include The Wall Street Journal, Dow Jones Newswires, Factiva, Barron’s, MarketWatch, SmartMoney and All Things D. Its information services combine technology with news and data to support business decision making. The company pioneered the first successful paid online news site and its industry leading innovation enables it to serve customers wherever they may be, via the Web, mobile devices and tablets. The Dow Jones Local Media Group publishes community newspapers, Web sites and other products in six U.S. states. Dow Jones & Company (www.dowjones.com) is a News Corporation company (NASDAQ: NWS, NWSA; ASX: NWS, NWSLV; http://www.newscorp.com/).
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