(MENAFN – Arab News) There has been a tremendous increase in the total value of personal loans extended by Saudi local banks in recent years. It shot up nearly 20 times within the last 13 years reaching SR219 billion in 2011 from SR11 billion in 1998, according to a report in Al-Eqtisadiah business daily.
This was mainly attributed to a huge increase in the number of banking customers and their reliance on local lenders to meet most of their personal requirements. Subsequently, almost all local banks have expanded their base of personal lending substantially even without taking into account the solvency of customers. Several financial and legal experts warned customers against relying heavily on banks to meet their financial requirements but most of them ignore such warnings.
Earlier, the number of customers who took out personal bank loans was very limited. In 1998, the volume of personal loans extended by local banks was merely SR11.2 billion. However it jumped three times to SR38.4 billion in 2001. The total value of personal loans was SR178.4 billion and SR198.8 billion in 2007 and 2010 respectively.
During Q3, 2011, the volume of personal loans extended by banks rose to SR218.9 billion. These included SR27.7 billion for real estate financing, SR46.2 billion for financing purchase of vehicles and equipment, and SR144.8 billion for other purposes, while credit card loans account for SR8.65 billion.
The huge increase in personal loans attributed mainly to the remarkable growth in the number of bank customers in recent years and their increased dependence on banks to meet most of their financial requirements. A number of Saudi financial and legal experts recently noted that Saudi banks had adopted a more cautious approach while extending personal loans in the past. Before 2000, the local banks concentrated mainly in extending loans only to companies and firms rather than individuals.
However, now the situation has been changed tremendously and almost all banks are competing each other to exploit this situation and resorting to the practice of receiving personal loan repayments directly from the salaries of borrowers. This practice served as a motivation for local banks to extend more personal loans to employees without taking into account their solvency.
The Saudi Arabian Monetary Agency (SAMA) introduced regulations for consumer financing and made them binding for the local banks effective Jan. 1, 2006. Banks are able to solve all the problems related to personal loans following the regulations issued by the central bank. There was also a SAMA directive that allows banks to treat the salaries of borrowers as security if they take out personal loans. This has helped banks to expand their base of personal lending substantially.
Some financial experts stressed that consumers must take utmost care and caution while taking personal loans so as not to affect their solvency as well as to prevent them from falling into a debt trap. They noted that consumers should take loans only if they are sure that they can make their prompt repayment. Loans be taken to fulfill only basic needs and not for any unnecessary requirements. There should be precise calculations and well thought out planning before taking loans, and there should not be any hasty decisions to take a loan. Precaution is to be taken against taking loans from illegal and unauthorized financial firms so as to avert becoming victims of fraudulent means and cheating.
Also, the monthly amount of repayment must be affordable to the consumer. There should also be proper balance between spending, borrowing and savings of the consumer. The consumer must have obtained all the relevant information with regard to the terms and conditions of borrowing and be fully aware of his ability to make repayments without affecting his solvency. The experts also cautioned against the habit of taking personal loans at regular intervals.
http://tourism9.com/ http://vkins.com/
2012年2月24日星期五
OFT Investigates Payday Loans Sector
The consumer watchdog has launched an “extensive” investigation into the payday loans sector on concerns that some payday lenders may be taking advantage of people in financial difficulty.
As part of the review by the Office of Fair Trading (OFT), 50 of the biggest players in the industry will face spot on-site inspections.
Increasing pressure on household finances has helped fuel the rise of short-term, high-interest lenders but the OFT is concerned that some people are being given loans without the proper checks being carried out.
It will investigate whether firms target people unsuitable for credit, or roll over the loans so that the charges escalate to the point where they become unaffordable.
The OFT’s director of consumer credit David Fisher said: “We are concerned that some payday lenders are taking advantage of people in financial difficulty, in breach of the Consumer Credit Act and not meeting the standards set out in our guidance on irresponsible lending. This is unacceptable.
“We will work with the trade bodies to drive up standards but will also not hesitate to take enforcement action, including revoking firms’ licences to operate where necessary.”
The regulator has already written to several financial trade bodies about concerns over payday lenders’ advertising standards after assessing 50 websites.
The Consumer Finance Association (CFA), which was one of the trade organisations contacted and represents several large payday lenders, said the OFT’s approach was “absolutely right”.
“We have to identify areas of mal-practice and stamp it out. We know that there are payday lenders around who are less than transparent in their advertising and do not carry out the right levels of financial checks, in fact some of them brag about that, but they are not and will never be members of the CFA,” chief executive John Lamidey said.
“Research shows that payday loans have a valuable role to play in today’s society and meet a real need for consumers who like the short term, limited nature of the loan and want to avoid borrowing larger amounts over long periods of time.
“So the OFT’s review, by clamping down on poor quality payday lenders, will be good for consumers and good for our industry.”
The Consumer Affairs Minister Norman Lamb has also welcomed the review.
http://tourism9.com/ http://vkins.com/
As part of the review by the Office of Fair Trading (OFT), 50 of the biggest players in the industry will face spot on-site inspections.
Increasing pressure on household finances has helped fuel the rise of short-term, high-interest lenders but the OFT is concerned that some people are being given loans without the proper checks being carried out.
It will investigate whether firms target people unsuitable for credit, or roll over the loans so that the charges escalate to the point where they become unaffordable.
The OFT’s director of consumer credit David Fisher said: “We are concerned that some payday lenders are taking advantage of people in financial difficulty, in breach of the Consumer Credit Act and not meeting the standards set out in our guidance on irresponsible lending. This is unacceptable.
“We will work with the trade bodies to drive up standards but will also not hesitate to take enforcement action, including revoking firms’ licences to operate where necessary.”
The regulator has already written to several financial trade bodies about concerns over payday lenders’ advertising standards after assessing 50 websites.
The Consumer Finance Association (CFA), which was one of the trade organisations contacted and represents several large payday lenders, said the OFT’s approach was “absolutely right”.
“We have to identify areas of mal-practice and stamp it out. We know that there are payday lenders around who are less than transparent in their advertising and do not carry out the right levels of financial checks, in fact some of them brag about that, but they are not and will never be members of the CFA,” chief executive John Lamidey said.
“Research shows that payday loans have a valuable role to play in today’s society and meet a real need for consumers who like the short term, limited nature of the loan and want to avoid borrowing larger amounts over long periods of time.
“So the OFT’s review, by clamping down on poor quality payday lenders, will be good for consumers and good for our industry.”
The Consumer Affairs Minister Norman Lamb has also welcomed the review.
http://tourism9.com/ http://vkins.com/
2012年2月20日星期一
Icelandic Anger Brings Debt Forgiveness in Best Recovery Story
February 20, 2012, 2:31 AM EST
By Omar R. Valdimarsson
Feb. 20 (Bloomberg) — Icelanders who pelted parliament with rocks in 2009 demanding their leaders and bankers answer for the country’s economic and financial collapse are reaping the benefits of their anger.
Since the end of 2008, the island’s banks have forgiven loans equivalent to 13 percent of gross domestic product, easing the debt burdens of more than a quarter of the population, according to a report published this month by the Icelandic Financial Services Association.
“You could safely say that Iceland holds the world record in household debt relief,” said Lars Christensen, chief emerging markets economist at Danske Bank A/S in Copenhagen. “Iceland followed the textbook example of what is required in a crisis. Any economist would agree with that.”
The island’s steps to resurrect itself since 2008, when its banks defaulted on $85 billion, are proving effective. Iceland’s economy will this year outgrow the euro area and the developed world on average, the Organization for Economic Cooperation and Development estimates. It costs about the same to insure against an Icelandic default as it does to guard against a credit event in Belgium. Most polls now show Icelanders don’t want to join the European Union, where the debt crisis is in its third year.
The island’s households were helped by an agreement between the government and the banks, which are still partly controlled by the state, to forgive debt exceeding 110 percent of home values. On top of that, a Supreme Court ruling in June 2010 found loans indexed to foreign currencies were illegal, meaning households no longer need to cover krona losses.
Crisis Lessons
“The lesson to be learned from Iceland’s crisis is that if other countries think it’s necessary to write down debts, they should look at how successful the 110 percent agreement was here,” said Thorolfur Matthiasson, an economics professor at the University of Iceland in Reykjavik, in an interview. “It’s the broadest agreement that’s been undertaken.”
Without the relief, homeowners would have buckled under the weight of their loans after the ratio of debt to incomes surged to 240 percent in 2008, Matthiasson said.
Iceland’s $13 billion economy, which shrank 6.7 percent in 2009, grew 2.9 percent last year and will expand 2.4 percent this year and next, the Paris-based OECD estimates. The euro area will grow 0.2 percent this year and the OECD area will expand 1.6 percent, according to November estimates.
Housing, measured as a subcomponent in the consumer price index, is now only about 3 percent below values in September 2008, just before the collapse. Fitch Ratings last week raised Iceland to investment grade, with a stable outlook, and said the island’s “unorthodox crisis policy response has succeeded.”
People Vs Markets
Iceland’s approach to dealing with the meltdown has put the needs of its population ahead of the markets at every turn.
Once it became clear back in October 2008 that the island’s banks were beyond saving, the government stepped in, ring-fenced the domestic accounts, and left international creditors in the lurch. The central bank imposed capital controls to halt the ensuing sell-off of the krona and new state-controlled banks were created from the remnants of the lenders that failed.
Activists say the banks should go even further in their debt relief. Andrea J. Olafsdottir, chairman of the Icelandic Homes Coalition, said she doubts the numbers provided by the banks are reliable.
“There are indications that some of the financial institutions in question haven’t lost a penny with the measures that they’ve undertaken,” she said.
Fresh Demands
According to Kristjan Kristjansson, a spokesman for Landsbankinn hf, the amount written off by the banks is probably larger than the 196.4 billion kronur ($1.6 billion) that the Financial Services Association estimates, since that figure only includes debt relief required by the courts or the government.
“There are still a lot of people facing difficulties; at the same time there are a lot of people doing fine,” Kristjansson said. “It’s nearly impossible to say when enough is enough; alongside every measure that is taken, there are fresh demands for further action.”
As a precursor to the global Occupy Wall Street movement and austerity protests across Europe, Icelanders took to the streets after the economic collapse in 2008. Protests escalated in early 2009, forcing police to use teargas to disperse crowds throwing rocks at parliament and the offices of then Prime Minister Geir Haarde. Parliament is still deciding whether to press ahead with an indictment that was brought against him in September 2009 for his role in the crisis.
A new coalition, led by Social Democrat Prime Minister Johanna Sigurdardottir, was voted into office in early 2009. The authorities are now investigating most of the main protagonists of the banking meltdown.
Legal Aftermath
Iceland’s special prosecutor has said it may indict as many as 90 people, while more than 200, including the former chief executives at the three biggest banks, face criminal charges.
Larus Welding, the former CEO of Glitnir Bank hf, once Iceland’s second biggest, was indicted in December for granting illegal loans and is now waiting to stand trial. The former CEO of Landsbanki Islands hf, Sigurjon Arnason, has endured stints of solitary confinement as his criminal investigation continues.
That compares with the U.S., where no top bank executives have faced criminal prosecution for their roles in the subprime mortgage meltdown. The Securities and Exchange Commission said last year it had sanctioned 39 senior officers for conduct related to the housing market meltdown.
The U.S. subprime crisis sent home prices plunging 33 percent from a 2006 peak. While households there don’t face the same degree of debt relief as that pushed through in Iceland, President Barack Obama this month proposed plans to expand loan modifications, including some principal reductions.
According to Christensen at Danske Bank, “the bottom line is that if households are insolvent, then the banks just have to go along with it, regardless of the interests of the banks.”
–Editors: Jonas Bergman, Tasneem Brogger.
To contact the reporter on this story: Omar R. Valdimarsson in Reykjavik valdimarsson@bloomberg.net.
To contact the editor responsible for this story: Jonas Bergman at jbergman@bloomberg.nethttp://tourism9.com/ http://vkins.com/
By Omar R. Valdimarsson
Feb. 20 (Bloomberg) — Icelanders who pelted parliament with rocks in 2009 demanding their leaders and bankers answer for the country’s economic and financial collapse are reaping the benefits of their anger.
Since the end of 2008, the island’s banks have forgiven loans equivalent to 13 percent of gross domestic product, easing the debt burdens of more than a quarter of the population, according to a report published this month by the Icelandic Financial Services Association.
“You could safely say that Iceland holds the world record in household debt relief,” said Lars Christensen, chief emerging markets economist at Danske Bank A/S in Copenhagen. “Iceland followed the textbook example of what is required in a crisis. Any economist would agree with that.”
The island’s steps to resurrect itself since 2008, when its banks defaulted on $85 billion, are proving effective. Iceland’s economy will this year outgrow the euro area and the developed world on average, the Organization for Economic Cooperation and Development estimates. It costs about the same to insure against an Icelandic default as it does to guard against a credit event in Belgium. Most polls now show Icelanders don’t want to join the European Union, where the debt crisis is in its third year.
The island’s households were helped by an agreement between the government and the banks, which are still partly controlled by the state, to forgive debt exceeding 110 percent of home values. On top of that, a Supreme Court ruling in June 2010 found loans indexed to foreign currencies were illegal, meaning households no longer need to cover krona losses.
Crisis Lessons
“The lesson to be learned from Iceland’s crisis is that if other countries think it’s necessary to write down debts, they should look at how successful the 110 percent agreement was here,” said Thorolfur Matthiasson, an economics professor at the University of Iceland in Reykjavik, in an interview. “It’s the broadest agreement that’s been undertaken.”
Without the relief, homeowners would have buckled under the weight of their loans after the ratio of debt to incomes surged to 240 percent in 2008, Matthiasson said.
Iceland’s $13 billion economy, which shrank 6.7 percent in 2009, grew 2.9 percent last year and will expand 2.4 percent this year and next, the Paris-based OECD estimates. The euro area will grow 0.2 percent this year and the OECD area will expand 1.6 percent, according to November estimates.
Housing, measured as a subcomponent in the consumer price index, is now only about 3 percent below values in September 2008, just before the collapse. Fitch Ratings last week raised Iceland to investment grade, with a stable outlook, and said the island’s “unorthodox crisis policy response has succeeded.”
People Vs Markets
Iceland’s approach to dealing with the meltdown has put the needs of its population ahead of the markets at every turn.
Once it became clear back in October 2008 that the island’s banks were beyond saving, the government stepped in, ring-fenced the domestic accounts, and left international creditors in the lurch. The central bank imposed capital controls to halt the ensuing sell-off of the krona and new state-controlled banks were created from the remnants of the lenders that failed.
Activists say the banks should go even further in their debt relief. Andrea J. Olafsdottir, chairman of the Icelandic Homes Coalition, said she doubts the numbers provided by the banks are reliable.
“There are indications that some of the financial institutions in question haven’t lost a penny with the measures that they’ve undertaken,” she said.
Fresh Demands
According to Kristjan Kristjansson, a spokesman for Landsbankinn hf, the amount written off by the banks is probably larger than the 196.4 billion kronur ($1.6 billion) that the Financial Services Association estimates, since that figure only includes debt relief required by the courts or the government.
“There are still a lot of people facing difficulties; at the same time there are a lot of people doing fine,” Kristjansson said. “It’s nearly impossible to say when enough is enough; alongside every measure that is taken, there are fresh demands for further action.”
As a precursor to the global Occupy Wall Street movement and austerity protests across Europe, Icelanders took to the streets after the economic collapse in 2008. Protests escalated in early 2009, forcing police to use teargas to disperse crowds throwing rocks at parliament and the offices of then Prime Minister Geir Haarde. Parliament is still deciding whether to press ahead with an indictment that was brought against him in September 2009 for his role in the crisis.
A new coalition, led by Social Democrat Prime Minister Johanna Sigurdardottir, was voted into office in early 2009. The authorities are now investigating most of the main protagonists of the banking meltdown.
Legal Aftermath
Iceland’s special prosecutor has said it may indict as many as 90 people, while more than 200, including the former chief executives at the three biggest banks, face criminal charges.
Larus Welding, the former CEO of Glitnir Bank hf, once Iceland’s second biggest, was indicted in December for granting illegal loans and is now waiting to stand trial. The former CEO of Landsbanki Islands hf, Sigurjon Arnason, has endured stints of solitary confinement as his criminal investigation continues.
That compares with the U.S., where no top bank executives have faced criminal prosecution for their roles in the subprime mortgage meltdown. The Securities and Exchange Commission said last year it had sanctioned 39 senior officers for conduct related to the housing market meltdown.
The U.S. subprime crisis sent home prices plunging 33 percent from a 2006 peak. While households there don’t face the same degree of debt relief as that pushed through in Iceland, President Barack Obama this month proposed plans to expand loan modifications, including some principal reductions.
According to Christensen at Danske Bank, “the bottom line is that if households are insolvent, then the banks just have to go along with it, regardless of the interests of the banks.”
–Editors: Jonas Bergman, Tasneem Brogger.
To contact the reporter on this story: Omar R. Valdimarsson in Reykjavik valdimarsson@bloomberg.net.
To contact the editor responsible for this story: Jonas Bergman at jbergman@bloomberg.nethttp://tourism9.com/ http://vkins.com/
2012年2月13日星期一
Student loans always are due, no matter how long overdue
By Kathy Lynn Gray
The Columbus Dispatch Monday February 13, 2012 5:24 AM
If you think the student loan you took out years ago but never repaid won’t come back to haunt you, think again.The Columbus Dispatch Monday February 13, 2012 5:24 AM
The debt could land you in federal court, pleading your case before a U.S. district judge.
“There’s no statute of limitations on student loans,” warned Assistant U.S. Attorney Deborah F. Sanders. “That debt is growing, and you still owe it.”
Sanders handles the student-loan default cases that come through the U.S. attorney’s office for the southern half of Ohio. Her office is pursuing about 400 cases.
“We get them because the (federal) Education Department has not been able to collect after many, many attempts,” Sanders said. “If it comes to our office, borrowers have had a lot of chances to pay.”
Defendants fall into two camps: those who don’t pay, and those who can’t, she said.
Usually the loans are years overdue, sometimes as long as 20 years. By that time, a large chunk of the money owed is interest that has accrued and compounded over the years.
In one case filed last year, the defendant owed $160,000, including nearly $25,000 in accrued interest on the 10-year-old loan. On another 10-year-old loan, nearly $40,000 of the $101,000 owed was interest.
If federal lawyers obtain a judgment against a debtor, the government can collect the money in a variety of ways. Wages and savings and checking accounts can be garnisheed, and tax refunds can be diverted, Sanders said. “We have a pretty good rate of collection.”
The court also can set up payment plans once a judgment has been made.
Unlike many other types of debt, student loans cannot be dismissed through bankruptcy except in rare situations, said Stephanie Dailey, a Columbus lawyer who specializes in bankruptcies.
“It’s almost impossible to get out of student-loan debt,” Dailey said. A debtor has to have a dire hardship, such as being completely disabled, she said.
About half the people who come to her with financial difficulties have student-loan debt, Dailey said. She advises them to approach the lender and try to get on a payment plan so that interest doesn’t continue to pile up.
“A lot of people will just stick their head in the sand and hope it’ll go away,” she said. “ Instead, they should let the creditor know they’re having trouble paying and ask for help.”
Dailey herself has nearly $100,000 in student-loan debt from law school. She has deferred her loans — postponed paying them with the blessing of the lender — when paychecks were lean. Interest continues to accrue during a deferral, but the lender won’t turn the loan over to collectors.
The number of student-loan defaults that went to federal court rose significantly in the late 1990s as the Justice Department pushed for collection. Nationwide, 1,142 default cases were filed in 1995; that number surged to 24,404 by 2000. But the number has fallen back since then as the Education Department has set up other ways to collect the debts, Sanders said.
At the same time, students are taking on more debt to attend college. In 2010, the average was $25,250, up 5 percent from the previous year, according to a study by the Project on Student Debt. The average in Ohio was $27,713. An estimated $1 trillion in total student loans is outstanding nationwide.
The default rate in 2009, the most-recent data available, was 8.8 percent. That includes borrowers with loan repayments due between Oct. 1, 2008, and Sept. 30, 2009. An estimate of the total amount of loan money in default is not available.
A survey released last week by the National Association of Consumer Bankruptcy Attorneys found that 81 percent of bankruptcy lawyers said the number of potential clients with student-loan debt has increased “significantly” or “somewhat” in the past three or four years.
The association thinks that student-loan debt could create an economic threat to the country as serious as the home-mortgage crisis did in the late 2000s.
kgray@dispatch.com
http://tourism9.cm/ http://vkins.com/
2012年2月7日星期二
Capital Access Network Raises $30M From Accel To Loan Small Businesses Working Capital
In this economic climate, many small businesses do not qualify for loans based on the standards imposed by banks and financial institutions. For fledgling businesses, the establishment doesn’t have enough cash flow, revenue or credit to qualify for a loan. Many times, entrepreneurs have to put up personal assets as collateral for loans, which can be problematic and risky. The fact is working capital is difficult to get from banks unless a business has perfect credit.
Capital Access Network (CAN), a company that gives small businesses access to credit and working capital and helps solve the problem outlines above, is announcing this morning that it has raised $30 million from Accel Partners. As part of the transaction, Accel partner, Kevin Efrusy will join Credit Access’s board of directors, and Accel vice president, John Locke, will join as an observer.
CAN constitutes the largest, non-bank alternative capital provider to small businesses in the US. The company uses its own real-time platform and risk scoring models to provide capital to small and medium-sized businesses in the US and Latin America and has funded over $2 billion in capital to SMB’s under the brands NewLogic Business Loans and AdvanceMe. This represents roughly 100,000 distinct small business finance transactions. This year alone, CAN will fund over $600 million in loans to small businesses.
CAN uses a variety of data points to deem a business worthy of credit or capital apart from the traditional criteria. CAN’s proprietary underwriting algorithms will churn through its vast data stacks of historical merchant demographic, firmographic, psychographic and social and behavioral profiles seeking and seasoning new behavioral and synthetic risk indicators and recombining those indicators into new risk scorecards.
For example, CAN will look at frequency of sales (not just how much), inventory access, eBay seller rating, tax returns and other information. In terms of interest, the company uses a more unorthodox, merchant-friendly way of collecting money on top of a loan. If an online violin store needs $30,000 in working capital to purchase inventory, CAN will loan the money, but the borrower will need to pay back $35,000 to CAN over 12 months.
Typically, CAN will give merchants and businesses anywhere from $2,500 to $250,000 in working capital. Customers range from medical practices, to shoe stores to auto repair shops to clothing, accessory and home product online retailers.
CAN CEO, Glenn Goldman, tells me that the extra amount the borrower has to pay to CAN depends on risk of the loan, how long it will take for the loan to be paid back, the amount of capital lent and other factors. But he says many times, the amount CAN charges is less than any interest rate from a bank. And 75 percent of customers renew their funding. In some cases, repayment can be fairly simple. Goldman points to the example of one online merchant who chose to automatically forward a small percentage of sales from its payment processor directly to CAN to repay the loan every month. If sales were lower than usual that month, CAN would lower the amount needed to pay.
And Goldman explains that behavioral risk scoring, rather than just examining a small business owner’s FICO score, allows the company to ‘yes’ to a higher percentage of SMBs than traditional sources while mitigating losses.
For Accel, the investment marks the continuation of a thesis of investing aggressively behind companies that are enabling small businesses to grow faster, says Efrusy. He cites investments in Groupon, Etsy, 99 Designs, Braintee, DropBox as just a few of the Accel-backed companies that are helping are “giving small businesses tools to thrive.”
“From our work with small businesses, it’s clear that one of the most pressing issues for merchants is access to credit and working capital,” Efrusy said. “Especially today, banks are unable to play effectively in this market. Large institutions cannot reach, evaluate, or serve small businesses efficiently. Many newcomers to the finance space are constrained by limited access to and very high-cost capital combined with high portfolio losses given unseasoned risk scoring models. Capital Access Network has by far the strongest team, scale, and data-driven approach to this market.”
Goldman says the new funding will be partly used for boosting and redesigning the online merchant experience on CAN. By April, the lender will feature new user interfaces, merchant portals and online approvals.
As Efrusy explains, there’s a huge amount of disruption taking place in the online lending space, and CAN is in a great position to help small businesses grow with working capital. Kabbage is another startup that is also looking to provide capital to online merchants, and ZestCash is doing something similar on the consumer end of the spectrum.http://tourism9.com/ http://vkins.com/
Capital Access Network (CAN), a company that gives small businesses access to credit and working capital and helps solve the problem outlines above, is announcing this morning that it has raised $30 million from Accel Partners. As part of the transaction, Accel partner, Kevin Efrusy will join Credit Access’s board of directors, and Accel vice president, John Locke, will join as an observer.
CAN constitutes the largest, non-bank alternative capital provider to small businesses in the US. The company uses its own real-time platform and risk scoring models to provide capital to small and medium-sized businesses in the US and Latin America and has funded over $2 billion in capital to SMB’s under the brands NewLogic Business Loans and AdvanceMe. This represents roughly 100,000 distinct small business finance transactions. This year alone, CAN will fund over $600 million in loans to small businesses.
CAN uses a variety of data points to deem a business worthy of credit or capital apart from the traditional criteria. CAN’s proprietary underwriting algorithms will churn through its vast data stacks of historical merchant demographic, firmographic, psychographic and social and behavioral profiles seeking and seasoning new behavioral and synthetic risk indicators and recombining those indicators into new risk scorecards.
For example, CAN will look at frequency of sales (not just how much), inventory access, eBay seller rating, tax returns and other information. In terms of interest, the company uses a more unorthodox, merchant-friendly way of collecting money on top of a loan. If an online violin store needs $30,000 in working capital to purchase inventory, CAN will loan the money, but the borrower will need to pay back $35,000 to CAN over 12 months.
Typically, CAN will give merchants and businesses anywhere from $2,500 to $250,000 in working capital. Customers range from medical practices, to shoe stores to auto repair shops to clothing, accessory and home product online retailers.
CAN CEO, Glenn Goldman, tells me that the extra amount the borrower has to pay to CAN depends on risk of the loan, how long it will take for the loan to be paid back, the amount of capital lent and other factors. But he says many times, the amount CAN charges is less than any interest rate from a bank. And 75 percent of customers renew their funding. In some cases, repayment can be fairly simple. Goldman points to the example of one online merchant who chose to automatically forward a small percentage of sales from its payment processor directly to CAN to repay the loan every month. If sales were lower than usual that month, CAN would lower the amount needed to pay.
And Goldman explains that behavioral risk scoring, rather than just examining a small business owner’s FICO score, allows the company to ‘yes’ to a higher percentage of SMBs than traditional sources while mitigating losses.
For Accel, the investment marks the continuation of a thesis of investing aggressively behind companies that are enabling small businesses to grow faster, says Efrusy. He cites investments in Groupon, Etsy, 99 Designs, Braintee, DropBox as just a few of the Accel-backed companies that are helping are “giving small businesses tools to thrive.”
“From our work with small businesses, it’s clear that one of the most pressing issues for merchants is access to credit and working capital,” Efrusy said. “Especially today, banks are unable to play effectively in this market. Large institutions cannot reach, evaluate, or serve small businesses efficiently. Many newcomers to the finance space are constrained by limited access to and very high-cost capital combined with high portfolio losses given unseasoned risk scoring models. Capital Access Network has by far the strongest team, scale, and data-driven approach to this market.”
Goldman says the new funding will be partly used for boosting and redesigning the online merchant experience on CAN. By April, the lender will feature new user interfaces, merchant portals and online approvals.
As Efrusy explains, there’s a huge amount of disruption taking place in the online lending space, and CAN is in a great position to help small businesses grow with working capital. Kabbage is another startup that is also looking to provide capital to online merchants, and ZestCash is doing something similar on the consumer end of the spectrum.http://tourism9.com/ http://vkins.com/
2012年1月31日星期二
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.
Photos/Multimedia Gallery Available: http://www.businesswire.com/cgi-bin/mmg.cgi?eid=50147844&lang=en
MULTIMEDIA AVAILABLE:http://www.businesswire.com/cgi-bin/mmg.cgi?eid=50147844&lang=en
http://tourism9.com/ http://vkins.com/
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
MULTIMEDIA AVAILABLE:http://www.businesswire.com/cgi-bin/mmg.cgi?eid=50147844&lang=en
http://tourism9.com/ http://vkins.com/
2012年1月30日星期一
First Financial Holdings, Inc. Announces Quarterly Financial Results and Declares Cash Dividend
CHARLESTON, S.C., Jan. 30, 2012 (GLOBE NEWSWIRE) — First Financial Holdings, Inc. (“First Financial“) (Nasdaq:FFCH – News), the holding company for First Federal Savings and Loan Association of Charleston (“First Federal”), announced today net income of $15.6 million for the three months ended December 31, 2011, compared with $1.1 million for the three months ended September 30, 2011 and $1.2 million for the three months ended December 31, 2010. After the effect of the preferred stock dividend and related accretion, First Financial reported net income available to common shareholders of $14.6 million for the three months ended December 31, 2011, compared with $113 thousand and $210 thousand for the three months ended September 30, 2011 and December 31, 2010, respectively. Diluted net income per common share was $0.88 for the quarter ended December 31, 2011, compared with $0.01 for both the prior quarter and for the same quarter last year. Diluted net income per common share from continuing operations was $0.88 for the quarter ended December 31, 2011, compared with $0.12 and $0.01 for the quarters ended September 30, 2011 and December 31, 2010, respectively.
“The successful completion of the bulk loan sale during this quarter marked yet another strategic initiative in the transformation of our company and has positioned First Financial to produce improved results for our shareholders,” said R. Wayne Hall, president and chief executive officer of First Financial and First Federal. “We are focused on providing superior products and services to our customers, generating organic loan growth and improving the efficiency of our operations.”
Highlights for the Quarter ended December 31, 2011
Total assets at December 31, 2011 were $3.1 billion, a decrease of $59.3 million or 1.9% from September 30, 2011 and a decrease of $154.4 million or 4.7% from December 31, 2010. The decline from September 30, 2011 was primarily the result of a decrease in loans held for sale due to the bulk loan sale and other assets, partially offset by an increase in portfolio loans. The decline from December 31, 2010 was primarily the result of the bulk loan sale, as well as the sales of First Southeast Insurance Services Inc. and Kimbrell Insurance Group, Inc. during 2011, partially offset by an increase in total investment securities.
Investment securities at December 31, 2011 totaled $457.7 million, a decrease of $11.8 million or 2.5% over September 30, 2011 and an increase of $22.2 million or 5.1% over December 31, 2010. The decrease from September 30, 2011 was primarily the result of normal cash flows and prepayments received during the quarter, partially offset by investment securities purchased. The increase over December 31, 2010 was primarily the result of purchasing new securities during 2011.
The following table summarizes the loan portfolio by major categories.
Total loans at December 31, 2011 increased $30.2 million or 1.3% over September 30, 2011 and decreased $197.9 million or 7.7% from December 31, 2010. The increase over September 30, 2011 was primarily the result of a higher volume of 15-year fixed rate residential loan originations, which were held in the portfolio, partially offset by declines in the commercial and consumer loan portfolios. While the total commercial loan portfolio declined, the commercial business portfolio increased 3.6% over September 30, 2011, and this pipeline has displayed recent signs of improvement. The decrease from December 31, 2010 was primarily the result of the bulk loan sale, partially offset by continued demand for residential mortgage loans due to the low interest rate environment. For both comparative periods, continued lower loan demand from creditworthy borrowers, charge-offs, transfers of nonperforming loans to other real estate owned (“OREO”), and paydowns due to normal borrower activity contributed to a reduction in loans.
The allowance for loan losses was $53.5 million at December 31, 2011 or 2.24% of total loans, compared with $54.3 million or 2.31% of total loans at September 30, 2011 and $88.3 million or 3.42% of total loans at December 31, 2010. The decrease from September 30, 2011 was primarily the result of the continued reduced level of charge-offs since the bulk loan sale. The decrease from December 31, 2010 was primarily the result of the bulk loan sale and improvement in credit quality measures during the past twelve months, as discussed further below. The allowance for loan losses at December 31, 2011 was 2.39% of loans excluding loans covered under a purchase and assumption loss-share agreement (“loss-share agreement”) with the FDIC (“covered loans”), and represented 1.77 times coverage of the non-covered nonperforming loans.
At December 31, 2011, loans held for sale totaled $48.3 million, a decrease of $46.6 million from September 30, 2011 and an increase of $19.8 million over December 31, 2010. Loans held for sale at September 30, 2011 consisted of $40.8 million of residential mortgage loans to be sold in the secondary market and $54.1 million of nonperforming and performing loans selected for the bulk loan sale, while during the other two periods the loans held for sale were solely comprised of residential mortgage loans to be sold in the secondary market. The increases in residential mortgage loans to be sold in the secondary market over both prior periods were primarily the result of higher borrower demand due to recent reductions in market interest rates. These loans generally settle in 45 to 60 days. The decrease in the bulk loan pool, which was established as of June 30, 2011, was the result of the sale and settlement of the entire pool during the December 31, 2011 quarter.
The FDIC indemnification asset, net at December 31, 2011 was $51.0 million, essentially unchanged from September 30, 2011 and a decrease of $17.3 million or 25.3% from December 31, 2010. The decrease was primarily the result of receiving claims reimbursement from the FDIC, partially offset by the normal accretion recorded to the indemnification asset.
Other assets totaled $98.9 million at December 31, 2011, a decrease of $22.6 million or 18.6% from September 30, 2011 and an increase of $4.7 million or 5.0% over December 31, 2010. The decrease from September 30, 2011 was primarily the result of lower levels of OREO properties, current tax adjustments and federal tax refunds received. The increase over December 31, 2010 was primarily the result of an increase in the deferred tax asset associated with the loss recorded in the June 30, 2011 quarter.
Core deposits, which include checking, savings, and money market accounts, totaled $1.2 billion at December 31, 2011, essentially unchanged from September 30, 2011 and an increase of $121.2 million or 10.9% over December 31, 2010. The increase was primarily the result of new retail deposit products introduced during 2011 as well as several marketing initiatives and campaigns during the last twelve months to attract and retain core deposits. Time deposits at December 31, 2011 totaled $1.0 billion, a decrease of $70.8 million or 6.6% from September 30, 2011 and a decrease of $291.7 million or 22.5% from December 31, 2010. The decreases were primarily the result of a planned reduction in maturing high rate retail and wholesale time deposits and lower funding needs relative to asset growth during the last twelve months.
Advances from the FHLB at December 31, 2011 totaled $561.0 million, essentially unchanged from September 30, 2011 and an increase of $63.9 million or 12.9% over December 31, 2010. The increase was primarily the result of a shift in funding mix due to the planned reduction of high rate time deposits, partially offset by using cash flow from investment securities and the loan portfolio to paydown FHLB advances.
Shareholders’ equity at December 31, 2011 was $277.2 million, an increase of $8.7 million or 3.2% over September 30, 2011 and a decrease of $38.1 million or 12.1% from December 31, 2010. The variances were primarily the result of net operating results during the last twelve months combined with a reduction in accumulated other comprehensive income due to a change in market value related to recent activity and updated assumptions on the valuation of certain securities. While First Financial is not currently required to report risk-based capital metrics at the holding company level, using December 31, 2011 data on a pro-forma basis, the Tier 1 capital ratio for First Financial would have been 14.13% and the total risk-based capital ratio would have been 15.39%. First Federal’s regulatory capital ratios continue to be above “well-capitalized” minimums, as evidenced by the key capital ratios and additional capital information presented in the following table.
Asset Quality
The following tables illustrate the trend in quality and risk inherent in the loan portfolio over the past twelve months.
Total delinquent loans at December 31, 2011 increased $3.6 million or 24.2% over September 30, 2011. The increases in delinquent residential and consumer loans were primarily the result of several customers with modification requests in process as well as a seasonal increase normally experienced in the fourth calendar quarter each year. Total delinquent loans at December 31, 2011 included $2.3 million in covered loans, as compared with $2.7 million at September 30, 2011.
Total nonperforming assets at December 31, 2011 decreased $40.3 million or 37.2% from September 30, 2011. The decrease was primarily the result of the bulk loan sale as well as lower OREO due to property sales exceeding transfers to OREO and lower nonperforming commercial loans due to the resolution of several non-performing loans. These decreases were partially offset by higher nonperforming residential loans due to six accounts totaling $2.8 million; higher home equity loans related to impaired loans totaling $1.7 million; and additional restructured loans still accruing due to completing customer modification requests. Nonperforming loans covered under the loss-share agreement decreased $1.5 million from September 30, 2011 to $17.5 million at December 31, 2011. Covered OREO totaled $7.6 million at December 31, 2011, a decrease of $1.1 million from September 30, 2011.
The decrease in net charge-offs for the quarter ended December 31, 2011 as compared with the prior quarter was the result of the lower risk inherent in the loan portfolio after the bulk loan sale. The increase in commercial real estate charge-offs was primarily the result of the resolution of several nonperforming loans. Net charge-offs for the prior quarter were comprised of $7.9 million of charge-offs related to normal credit practices and $2.2 million of charge-offs on additional loans transferred to loans held for sale, the majority of which were related to existing loans in the pool.
The following table provides details on classified assets by category.
Discontinued Operations Financial Statement Presentation
As a result of First Financial’s sales of its insurance agency subsidiary, First Southeast Insurance Services, Inc., which was completed on June 1, 2011, and its managing general insurance agency subsidiary, Kimbrell Insurance Group, Inc., which was completed on September 30, 2011, the financial condition, operating results, and the gain or loss on the sales, net of transaction costs and taxes, for these subsidiaries have been segregated from the financial condition and operating results of First Financial’s continuing operations throughout this release and, as such, are presented as discontinued operations. While all prior periods have been revised retrospectively to align with this treatment, these changes do not affect First Financial’s reported consolidated financial condition or operating results for any of the prior periods.
Quarterly Results of Operations
First Financial reported net income from continuing operations of $15.6 million for the three months ended December 31, 2011, compared with $2.9 million for the three months ended September 30, 2011 and $1.1 million for the three months ended December 31, 2010. The quarter ended December 31, 2011 included a $20.8 million pre-tax gain ($12.7 million after-tax) from the bulk loan sale. The changes in the key components of net income from continuing operations are discussed below.
Net interest income
Net interest margin, on a fully tax-equivalent basis, was 3.91% for the quarter ended December 31, 2011, as compared with 3.87% for the quarter ended September 30, 2011 and 3.83% for the quarter ended December 31, 2010. The increase over the linked quarter was primarily the result of a reduction in the rate paid on interest-bearing liabilities. The increase from the same quarter last year was primarily the result of the decrease in yield on interest-bearing liabilities exceeding the decrease in the yield on earning assets as First Financial continues to grow core deposits, especially noninterest-bearing deposits.
Net interest income for the quarter ended December 31, 2011 was $28.9 million, essentially unchanged from the prior quarter and a decrease of $1.3 million or 4.5% from the same quarter last year. The decrease from the same quarter last year was primarily the result of a decline in average earning assets due to the bulk loan sale, combined with the decline in net loans due to the generally lower loan demand from creditworthy borrowers and loan charge-offs.
Provision for loan losses
After determining what First Financial believes is an adequate allowance for loan losses based on the estimated risk inherent in the loan portfolio, the provision for loan losses is calculated based on the net effect of the change in the allowance for loan losses and net charge-offs. The provision for loan losses was $7.4 million for the quarter ended December 31, 2011, compared with $8.9 million for the linked quarter and $10.5 million for the same quarter last year. The provision for loan losses for the linked quarter included $1.4 million related to loans transferred to the bulk sale pool, and represents the net result of the incremental charge-offs on those loans less their related reserve release. The decrease from both prior periods was primarily the result of lower net charge-offs and lower classified loans at December 31, 2011.
Noninterest income
Noninterest income totaled $32.8 million for the quarter ended December 31, 2011, an increase of $18.5 million over the prior quarter and an increase of $22.2 million over the same quarter last year. The quarter ended December 31, 2011 included a $20.8 million pre-tax gain from the bulk loan sale. The prior quarter included net gains totaling $1.9 million related to the resolution of certain loans in the bulk loan pool. Noninterest income from core operations totaled $12.0 million and $12.3 for the quarters ended December 31, 2011 and September 30, 2011, respectively.
The increase over the same quarter last year was primarily the result of the gain on the bulk loan sale as well as higher service charges on deposit accounts ($821 thousand) due to higher transaction-related revenue from increases in both volume and fees.
Noninterest expense
Noninterest expense totaled $28.9 million for the quarter ended December 31, 2011, a decrease of $701 thousand or 2.4% over the linked quarter and essentially unchanged from the same quarter last year. The decrease from the linked quarter was primarily the result of lower OREO, net ($1.6 million) and lower professional services expenses ($502 thousand), partially offset by higher other expense ($1.2 million). The decrease in OREO costs was primarily the result of fewer valuation adjustments on properties held. The decrease in professional services was primarily the result of $521 thousand in legal and other advisory services in the prior quarter related to preparing the loans held in the bulk sale pool for final disposition. The increase in other expense was primarily the result of higher processing fees related to a new reward program for deposit customers, higher loss reserves for the reinsurance subsidiary, and higher operational losses related to uncollectible foreclosure expenses.
Noninterest expense was essentially unchanged from the same quarter last year as increases in other expense ($1.1 million) and OREO, net ($414 thousand) were essentially offset by reductions in salaries and employee benefits ($969 thousand), professional services ($523 thousand), and FDIC insurance and regulatory fees ($350 thousand). The variances in other expense and OREO, net were primarily the result of the factors discussed above. The decrease in salaries and employee benefits was primarily the result of lower staff levels due to initiatives implemented during 2011. The reduction in professional services was primarily the result of using external resources to assist in the implementation of several strategic initiatives including loss-sharing management, OREO management, and compensation studies during the December 31, 2010 quarter. The decrease in FDIC insurance and regulatory fees was primarily the result of the new assessment methodology implemented by the FDIC during 2011.
Cash Dividend Declared
On January 30, 2012, First Financial’s Board of Directors declared a quarterly cash dividend of $0.05 per share. The dividend is payable on February 27, 2012 to shareholders of record as of February 13, 2012.
Conference Call
R. Wayne Hall, president and CEO; Blaise B. Bettendorf, EVP and CFO; and Joseph W. Amy, EVP and CCO; will review the quarter’s results in a conference call at 2:00 pm (ET), January 30, 2012. The live audio webcast is available on First Financial’s website at www.firstfinancialholdings.com and will be available for 90 days.
About First Financial
First Financial Holdings, Inc. (“First Financial”) (Nasdaq:FFCH – News) is a Charleston, South Carolina financial services provider with $3.1 billion in total assets as of December 31, 2011. First Financial offers integrated financial solutions, including personal, business, and wealth management services. First Federal Savings and Loan Association (“First Federal”), which was founded in 1934 and is the primary subsidiary, serves individuals and businesses throughout coastal South Carolina, Florence, South Carolina and Wilmington, North Carolina. First Financial subsidiaries include: First Federal; First Southeast Investor Services, Inc., a registered broker-dealer; and First Southeast 401(k) Fiduciaries, Inc., a registered investment advisor. First Federal is the largest financial institution headquartered in the Charleston, South Carolina metropolitan area and the third largest financial institution headquartered in South Carolina, based on asset size. Additional information about First Financial is available at www.firstfinancialholdings.com.
Non-GAAP Financial Information
In addition to results presented in accordance with U.S. generally accepted accounting principles (“GAAP”), this press release includes non-GAAP financial measures such as the efficiency ratio, the tangible common equity to tangible assets ratio, tangible common book value per share, and pre-tax pre-provision earnings. First Financial believes these non-GAAP financial measures provide additional information that is useful to investors in understanding its underlying performance, business, and performance trends and such measures help facilitate performance comparisons with others in the banking industry. Non-GAAP measures have inherent limitations, are not required to be uniformly applied, and are not audited. Readers should be aware of these limitations and should be cautious to their use of such measures. To mitigate these limitations, First Financial has procedures in place to ensure that these measures are calculated using the appropriate GAAP or regulatory components in their entirety and to ensure that its performance is properly reflected to facilitate consistent period-to-period comparisons. Although management believes the above non-GAAP financial measures enhance investors’ understanding of First Financial’s business and performance, these non-GAAP measures should not be considered in isolation, or as a substitute for GAAP basis financial measures.
In accordance with industry standards, certain designated net interest income amounts are presented on a taxable equivalent basis, including the calculation used in the efficiency ratio.
First Financial believes the exclusion of goodwill and other intangible assets facilitates the comparison of results for ongoing business operations. The tangible common equity (“TCE”) ratio and tangible common book value per share (“TBV”) have become a focus of some investors, analysts and banking regulators. Management believes these measures may assist in analyzing First Financial’s capital position absent the effects of intangible assets and preferred stock. Because TCE and TBV are not formally defined by GAAP or codified in the federal banking regulations, these measures are considered to be non-GAAP financial measures. However, analysts and banking regulators may assess First Financial’s capital adequacy using TCE or TBV, therefore, management believes that it is useful to provide investors the ability to assess its capital adequacy on the same basis.
First Financial believes that pre-tax, pre-provision earnings are a useful measure in assessing its core operating performance, particularly during times of economic stress. This measurement, as defined by management, represents total revenue (net interest income plus noninterest income) less noninterest expense. As recent results for the banking industry demonstrate, credit writedowns, loan charge-offs, and related provisions for loan losses can vary significantly from period to period, making a measure that helps isolate the impact of credit costs on profitability important to investors.
Please refer to the Selected Financial Information table and the Non-GAAP Reconciliation table later in this release for additional information.
Forward-Looking Statements
Statements in this release that are not statements of historical fact, including without limitation, statements that include terms such as “believes,” “expects,” “anticipates,” “estimates,” “forecasts,” “intends,” “plans,” “targets,” “potentially,” “probably,” “projects,” “outlook,” or similar expressions or future conditional verbs such as “may,” “will,” “should,” “would,” or “could” constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements regarding First Financial’s future financial and operating results, plans, objectives, expectations and intentions involve risks and uncertainties, many of which are beyond First Financial’s control or are subject to change. No forward-looking statement is a guarantee of future performance and actual results could differ materially. Factors that could cause or contribute to such differences include, but are not limited to, the general business environment, general economic conditions nationally and in the States of North and South Carolina, interest rates, the North and South Carolina real estate markets, the demand for mortgage loans, the credit risk of lending activities, including changes in the level and trend of delinquent and nonperforming loans and charge-offs, changes in First Federal’s allowance for loan losses and provision for loan losses that may be affected by deterioration in the housing and real estate markets; results of examinations by banking regulators, including the possibility that any such regulatory authority may, among other things, require First Federal to increase its allowance for loan losses, writedown assets, change First Federal’s regulatory capital position or affect its ability to borrow funds or maintain or increase deposits, which could adversely affect liquidity and earnings; First Financial’s ability to control operating costs and expenses, First Financial’s ability to successfully integrate any assets, liabilities, customers, systems, and management personnel acquired or may in the future acquire into its operations and its ability to realize related revenue synergies and cost savings within expected time frames and any goodwill charges related thereto, competitive conditions between banks and non-bank financial services providers, and regulatory changes including the Dodd-Frank Wall Street Reform and Consumer Protection Act. Other risks are also detailed in First Financial’s Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and current reports on Form 8-K filings with the Securities and Exchange Commission (“SEC”), which are available at the SEC’s website www.sec.gov. Other factors not currently anticipated may also materially and adversely affect First Financial’s results of operations, financial position, and cash flows. There can be no assurance that future results will meet expectations. While First Financial believes that the forward-looking statements in this release are reasonable, the reader should not place undue reliance on any forward-looking statement. In addition, these statements speak only as of the date made. First Financial does not undertake, and expressly disclaims any obligation to update or alter any statements, whether as a result of new information, future events or otherwise, except as required by applicable law.
http://tourism9.com/ http://vkins.com/
“The successful completion of the bulk loan sale during this quarter marked yet another strategic initiative in the transformation of our company and has positioned First Financial to produce improved results for our shareholders,” said R. Wayne Hall, president and chief executive officer of First Financial and First Federal. “We are focused on providing superior products and services to our customers, generating organic loan growth and improving the efficiency of our operations.”
Highlights for the Quarter ended December 31, 2011
- On October 26, 2011, First Financial sold certain performing loans and classified assets in a bulk sale (the “bulk loan sale”) with an aggregate contractual principal balance of $197.9 million to affiliates of Varde Partners, Inc. and recorded a pre-tax gain of $20.8 million on the transaction.
- Net interest margin remained strong for the quarter ended December 31, 2011 at 3.91%, an increase of four basis points over the prior quarter ended September 30, 2011.
- The allowance for loan losses totaled $53.5 million at December 31, 2011 or 2.24% of total loans, compared with $54.3 million or 2.31% of total loans at September 30, 2011.
- Credit metrics remain strong with non-covered nonperforming assets to total assets of 1.35% at December 31, 2011 compared with 1.23% at September 30, 2011.
- The provision for loan losses for the quarter ended December 31, 2011 totaled $7.4 million, compared with $8.9 million for the linked quarter.
- Net charge-offs totaled $8.3 million for the quarter ended December 31, 2011, compared with $10.1 million for the linked quarter.
- First Financial’s tangible common equity to tangible common assets ratio increased to 6.67% at December 31, 2011, as compared with 6.27% at September 30, 2011. The consolidated total risk-based capital ratio (pro-forma) would have been 15.39% at December 31, 2011, as compared with 14.36% at September 30, 2011.
- On December 21, 2011 First Financial announced that it filed an application with the Federal Reserve Bank of Richmond to convert from a savings and loan holding company to a bank holding company, that First Federal had received conditional approval from the State of South Carolina to convert from a federal savings and loan association to a state-chartered commercial bank (subject to the holding company approval), and that First Financial’s Board of Directors approved an amendment to the bylaws to change the fiscal year from September 30th to December 31st.
Total assets at December 31, 2011 were $3.1 billion, a decrease of $59.3 million or 1.9% from September 30, 2011 and a decrease of $154.4 million or 4.7% from December 31, 2010. The decline from September 30, 2011 was primarily the result of a decrease in loans held for sale due to the bulk loan sale and other assets, partially offset by an increase in portfolio loans. The decline from December 31, 2010 was primarily the result of the bulk loan sale, as well as the sales of First Southeast Insurance Services Inc. and Kimbrell Insurance Group, Inc. during 2011, partially offset by an increase in total investment securities.
Investment securities at December 31, 2011 totaled $457.7 million, a decrease of $11.8 million or 2.5% over September 30, 2011 and an increase of $22.2 million or 5.1% over December 31, 2010. The decrease from September 30, 2011 was primarily the result of normal cash flows and prepayments received during the quarter, partially offset by investment securities purchased. The increase over December 31, 2010 was primarily the result of purchasing new securities during 2011.
The following table summarizes the loan portfolio by major categories.
| LOANS(in thousands) | December 31, 2011 | September 30, 2011 | June 30, 2011 | March 31, 2011 | December 31, 2010 | |||||
| Residential loans | ||||||||||
| Residential 1-4 family | $ 975,405 | $ 909,907 | $ 895,650 | $ 916,146 | $ 887,924 | |||||
| Residential construction | 15,117 | 16,431 | 19,603 | 20,311 | 15,639 | |||||
| Residential land | 41,612 | 40,725 | 42,763 | 48,955 | 53,772 | |||||
| Total residential loans | 1,032,134 | 967,063 | 958,016 | 985,412 | 957,335 | |||||
| Commercial loans | ||||||||||
| Commercial business | 83,814 | 80,871 | 80,566 | 91,005 | 91,129 | |||||
| Commercial real estate | 456,541 | 471,296 | 482,315 | 570,300 | 590,816 | |||||
| Commercial construction | 16,477 | 15,051 | 16,037 | 22,269 | 23,895 | |||||
| Commercial land | 61,238 | 67,432 | 70,562 | 119,326 | 133,899 | |||||
| Total commercial loans | 618,070 | 634,650 | 649,480 | 802,900 | 839,739 | |||||
| Consumer loans | ||||||||||
| Home equity | 357,270 | 369,213 | 379,122 | 387,957 | 396,010 | |||||
| Manufactured housing | 275,275 | 276,047 | 274,192 | 270,694 | 269,555 | |||||
| Marine | 52,590 | 55,243 | 57,406 | 59,428 | 62,830 | |||||
| Other consumer | 50,118 | 53,064 | 53,853 | 53,454 | 57,898 | |||||
| Total consumer loans | 735,253 | 753,567 | 764,573 | 771,533 | 786,293 | |||||
| Total loans | 2,385,457 | 2,355,280 | 2,372,069 | 2,559,845 | 2,583,367 | |||||
| Less: Allowance for loan losses | 53,524 | 54,333 | 55,491 | 85,138 | 88,349 | |||||
| Net loans | $ 2,331,933 | $ 2,300,947 | $ 2,316,578 | $ 2,474,707 | $ 2,495,018 | |||||
Total loans at December 31, 2011 increased $30.2 million or 1.3% over September 30, 2011 and decreased $197.9 million or 7.7% from December 31, 2010. The increase over September 30, 2011 was primarily the result of a higher volume of 15-year fixed rate residential loan originations, which were held in the portfolio, partially offset by declines in the commercial and consumer loan portfolios. While the total commercial loan portfolio declined, the commercial business portfolio increased 3.6% over September 30, 2011, and this pipeline has displayed recent signs of improvement. The decrease from December 31, 2010 was primarily the result of the bulk loan sale, partially offset by continued demand for residential mortgage loans due to the low interest rate environment. For both comparative periods, continued lower loan demand from creditworthy borrowers, charge-offs, transfers of nonperforming loans to other real estate owned (“OREO”), and paydowns due to normal borrower activity contributed to a reduction in loans.
The allowance for loan losses was $53.5 million at December 31, 2011 or 2.24% of total loans, compared with $54.3 million or 2.31% of total loans at September 30, 2011 and $88.3 million or 3.42% of total loans at December 31, 2010. The decrease from September 30, 2011 was primarily the result of the continued reduced level of charge-offs since the bulk loan sale. The decrease from December 31, 2010 was primarily the result of the bulk loan sale and improvement in credit quality measures during the past twelve months, as discussed further below. The allowance for loan losses at December 31, 2011 was 2.39% of loans excluding loans covered under a purchase and assumption loss-share agreement (“loss-share agreement”) with the FDIC (“covered loans”), and represented 1.77 times coverage of the non-covered nonperforming loans.
At December 31, 2011, loans held for sale totaled $48.3 million, a decrease of $46.6 million from September 30, 2011 and an increase of $19.8 million over December 31, 2010. Loans held for sale at September 30, 2011 consisted of $40.8 million of residential mortgage loans to be sold in the secondary market and $54.1 million of nonperforming and performing loans selected for the bulk loan sale, while during the other two periods the loans held for sale were solely comprised of residential mortgage loans to be sold in the secondary market. The increases in residential mortgage loans to be sold in the secondary market over both prior periods were primarily the result of higher borrower demand due to recent reductions in market interest rates. These loans generally settle in 45 to 60 days. The decrease in the bulk loan pool, which was established as of June 30, 2011, was the result of the sale and settlement of the entire pool during the December 31, 2011 quarter.
The FDIC indemnification asset, net at December 31, 2011 was $51.0 million, essentially unchanged from September 30, 2011 and a decrease of $17.3 million or 25.3% from December 31, 2010. The decrease was primarily the result of receiving claims reimbursement from the FDIC, partially offset by the normal accretion recorded to the indemnification asset.
Other assets totaled $98.9 million at December 31, 2011, a decrease of $22.6 million or 18.6% from September 30, 2011 and an increase of $4.7 million or 5.0% over December 31, 2010. The decrease from September 30, 2011 was primarily the result of lower levels of OREO properties, current tax adjustments and federal tax refunds received. The increase over December 31, 2010 was primarily the result of an increase in the deferred tax asset associated with the loss recorded in the June 30, 2011 quarter.
Core deposits, which include checking, savings, and money market accounts, totaled $1.2 billion at December 31, 2011, essentially unchanged from September 30, 2011 and an increase of $121.2 million or 10.9% over December 31, 2010. The increase was primarily the result of new retail deposit products introduced during 2011 as well as several marketing initiatives and campaigns during the last twelve months to attract and retain core deposits. Time deposits at December 31, 2011 totaled $1.0 billion, a decrease of $70.8 million or 6.6% from September 30, 2011 and a decrease of $291.7 million or 22.5% from December 31, 2010. The decreases were primarily the result of a planned reduction in maturing high rate retail and wholesale time deposits and lower funding needs relative to asset growth during the last twelve months.
Advances from the FHLB at December 31, 2011 totaled $561.0 million, essentially unchanged from September 30, 2011 and an increase of $63.9 million or 12.9% over December 31, 2010. The increase was primarily the result of a shift in funding mix due to the planned reduction of high rate time deposits, partially offset by using cash flow from investment securities and the loan portfolio to paydown FHLB advances.
Shareholders’ equity at December 31, 2011 was $277.2 million, an increase of $8.7 million or 3.2% over September 30, 2011 and a decrease of $38.1 million or 12.1% from December 31, 2010. The variances were primarily the result of net operating results during the last twelve months combined with a reduction in accumulated other comprehensive income due to a change in market value related to recent activity and updated assumptions on the valuation of certain securities. While First Financial is not currently required to report risk-based capital metrics at the holding company level, using December 31, 2011 data on a pro-forma basis, the Tier 1 capital ratio for First Financial would have been 14.13% and the total risk-based capital ratio would have been 15.39%. First Federal’s regulatory capital ratios continue to be above “well-capitalized” minimums, as evidenced by the key capital ratios and additional capital information presented in the following table.
| For the Three Months Ended | ||||||||||||
| December 31, 2011 | September 30, 2011 | June 30, 2011 | March 31, 2011 | December 31, 2010 | ||||||||
| First Financial | ||||||||||||
| Equity to assets | 8.81% | 8.37% | 8.27% | 9.43% | 9.55% | |||||||
| Tangible common equity to tangible assets (non-GAAP) | 6.67 | 6.27 | 6.08 | 6.40 | 6.51 | |||||||
| Book value per common share | $ 12.84 | $ 12.31 | $ 12.20 | $ 14.92 | $ 15.15 | |||||||
| Tangible common book value per share (non-GAAP) | 12.69 | 12.16 | 11.83 | 12.65 | 12.86 | |||||||
| Dividends paid per common share, authorized | 0.05 | 0.05 | 0.05 | 0.05 | 0.05 | |||||||
| Common shares outstanding, end of period (000s) | 16,527 | 16,527 | 16,527 | 16,527 | 16,527 | |||||||
| First Federal | Regulatory Minimum for “Well-Capitalized” | |||||||||||
| Leverage capital ratio | 5.00% | 8.92% | 8.26% | 7.48% | 8.58% | 8.58% | ||||||
| Tier 1 risk-based capital ratio | 6.00 | 12.35 | 11.26 | 10.07 | 11.51 | 11.42 | ||||||
| Total risk-based capital ratio | 10.00 | 13.61 | 12.53 | 11.33 | 12.78 | 12.69 | ||||||
Asset Quality
The following tables illustrate the trend in quality and risk inherent in the loan portfolio over the past twelve months.
| DELINQUENT LOANS | December 31, 2011 | September 30, 2011 | June 30, 2011 | March 31, 2011 | December 31, 2010 | |||||||||||||||
| (30-89 days past due) (in thousands) | $ | % of Portfolio | $ | % of Portfolio | $ | % of Portfolio | $ | % of Portfolio | $ | % of Portfolio | ||||||||||
| Residential loans | ||||||||||||||||||||
| Residential 1-4 family | $ 2,986 | 0.31% | $ 1,722 | 0.19% | $ 1,404 | 0.16% | $ 3,050 | 0.33% | $ 6,712 | 0.76% | ||||||||||
| Residential construction | – | – | – | – | – | – | – | – | – | – | ||||||||||
| Residential land | 561 | 1.35 | 65 | 0.16 | 325 | 0.76 | 1,398 | 2.86 | 432 | 0.80 | ||||||||||
| Total residential loans | 3,547 | 0.34 | 1,787 | 0.18 | 1,729 | 0.18 | 4,448 | 0.45 | 7,144 | 0.75 | ||||||||||
| Commercial loans | ||||||||||||||||||||
| Commercial business | 908 | 1.08 | 868 | 1.07 | 2,387 | 2.96 | 1,618 | 1.78 | 3,476 | 3.81 | ||||||||||
| Commercial real estate | 3,514 | 0.77 | 3,394 | 0.72 | 2,703 | 0.56 | 9,322 | 1.63 | 10,600 | 1.79 | ||||||||||
| Commercial construction | – | – | 595 | 3.95 | – | – | – | – | 635 | 2.66 | ||||||||||
| Commercial land | 1,185 | 1.94 | 537 | 0.80 | 821 | 1.16 | 4,220 | 3.54 | 5,348 | 3.99 | ||||||||||
| Total commercial loans | 5,607 | 0.91 | 5,394 | 0.85 | 5,911 | 0.91 | 15,160 | 1.89 | 20,059 | 2.39 | ||||||||||
| Consumer loans | ||||||||||||||||||||
| Home equity | 4,525 | 1.27 | 3,408 | 0.92 | 3,266 | 0.86 | 3,550 | 0.92 | 4,355 | 1.10 | ||||||||||
| Manufactured housing | 3,267 | 1.19 | 2,600 | 0.94 | 2,298 | 0.84 | 2,491 | 0.92 | 4,043 | 1.50 | ||||||||||
| Marine | 597 | 1.14 | 980 | 1.77 | 264 | 0.46 | 296 | 0.50 | 707 | 1.13 | ||||||||||
| Other consumer | 831 | 1.66 | 629 | 1.19 | 589 | 1.09 | 592 | 1.11 | 905 | 1.56 | ||||||||||
| Total consumer loans | 9,220 | 1.25 | 7,617 | 1.01 | 6,417 | 0.84 | 6,929 | 0.90 | 10,010 | 1.27 | ||||||||||
| Total delinquent loans | $ 18,374 | 0.77% | $ 14,798 | 0.63% | $ 14,057 | 0.59% | $ 26,537 | 1.04% | $ 37,213 | 1.44% | ||||||||||
Total delinquent loans at December 31, 2011 increased $3.6 million or 24.2% over September 30, 2011. The increases in delinquent residential and consumer loans were primarily the result of several customers with modification requests in process as well as a seasonal increase normally experienced in the fourth calendar quarter each year. Total delinquent loans at December 31, 2011 included $2.3 million in covered loans, as compared with $2.7 million at September 30, 2011.
| December 31, 2011 | September 30, 2011 | June 30, 2011 | March 31, 2011 | December 31, 2010 | ||||||||||||||||
| NONPERFORMING ASSETS(in thousands) | $ | % of Portfolio | $ | % of Portfolio | $ | % of Portfolio | $ | % of Portfolio | $ | % of Portfolio | ||||||||||
| Residential loans | ||||||||||||||||||||
| Residential 1-4 family | $ 4,977 | 0.51% | $ 1,595 | 0.18% | $ 1,242 | 0.14% | $ 23,663 | 2.58% | $ 20,371 | 2.29% | ||||||||||
| Residential construction | – | – | – | – | – | – | – | – | – | – | ||||||||||
| Residential land | 1,448 | 3.48 | 1,140 | 2.80 | 451 | 1.05 | 3,604 | 7.36 | 4,997 | 9.29 | ||||||||||
| Total residential loans | 6,425 | 0.62 | 2,735 | 0.28 | 1,693 | 0.18 | 27,267 | 2.77 | 25,368 | 2.65 | ||||||||||
| Commercial loans | ||||||||||||||||||||
| Commercial business | 3,665 | 4.37 | 4,322 | 5.34 | 3,664 | 4.55 | 9,151 | 10.06 | 9,769 | 10.72 | ||||||||||
| Commercial real estate | 17,160 | 3.76 | 18,400 | 3.90 | 16,396 | 3.40 | 60,256 | 10.57 | 57,724 | 9.77 | ||||||||||
| Commercial construction | 573 | 3.48 | 266 | 1.77 | 1,451 | 9.05 | 4,074 | 18.29 | 4,484 | 18.77 | ||||||||||
| Commercial land | 5,232 | 8.54 | 6,310 | 9.36 | 5,411 | 7.67 | 40,740 | 34.14 | 43,824 | 32.73 | ||||||||||
| Total commercial loans | 26,630 | 4.31 | 29,298 | 4.62 | 26,922 | 4.15 | 114,221 | 14.23 | 115,801 | 13.79 | ||||||||||
| Consumer loans | ||||||||||||||||||||
| Home equity | 8,192 | 2.29 | 6,871 | 1.86 | 9,165 | 2.42 | 9,379 | 2.42 | 9,450 | 2.39 | ||||||||||
| Manufactured housing | 3,461 | 1.26 | 2,922 | 1.06 | 2,953 | 1.08 | 3,517 | 1.30 | 3,609 | 1.34 | ||||||||||
| Marine | 246 | 0.47 | 47 | 0.09 | 94 | 0.16 | 42 | 0.07 | 67 | 0.11 | ||||||||||
| Other consumer | 224 | 0.45 | 127 | 0.24 | 129 | 0.24 | 181 | 0.34 | 555 | 0.96 | ||||||||||
| Total consumer loans | 12,123 | 1.65 | 9,967 | 1.32 | 12,341 | 1.61 | 13,119 | 1.70 | 13,681 | 1.74 | ||||||||||
| Total nonaccrual loans | 45,178 | 1.89 | 42,000 | 1.78 | 40,956 | 1.73 | 154,607 | 6.04 | 154,850 | 5.99 | ||||||||||
| Loans 90+ days still accruing | 121 | 171 | 76 | 109 | 204 | |||||||||||||||
| Restructured Loans, still accruing | 2,411 | 734 | 1,535 | 1,550 | 1,578 | |||||||||||||||
| Total nonperforming loans | 47,710 | 2.00% | 42,905 | 1.82% | 42,567 | 1.79% | 156,266 | 6.10% | 156,632 | 6.06% | ||||||||||
| Nonperforming loans held for sale | – | 39,412 | 42,656 | – | – | |||||||||||||||
| Other repossessed assets acquired | 20,487 | 26,212 | 27,812 | 25,986 | 19,660 | |||||||||||||||
| Total nonperfoming assets | $ 68,197 | $108,529 | $113,035 | $182,252 | $176,292 | |||||||||||||||
Total nonperforming assets at December 31, 2011 decreased $40.3 million or 37.2% from September 30, 2011. The decrease was primarily the result of the bulk loan sale as well as lower OREO due to property sales exceeding transfers to OREO and lower nonperforming commercial loans due to the resolution of several non-performing loans. These decreases were partially offset by higher nonperforming residential loans due to six accounts totaling $2.8 million; higher home equity loans related to impaired loans totaling $1.7 million; and additional restructured loans still accruing due to completing customer modification requests. Nonperforming loans covered under the loss-share agreement decreased $1.5 million from September 30, 2011 to $17.5 million at December 31, 2011. Covered OREO totaled $7.6 million at December 31, 2011, a decrease of $1.1 million from September 30, 2011.
| December 31, 2011 | September 30, 2011 | June 30, 2011 | March 31, 2011 | December 31, 2010 | ||||||||||||||||
| NET CHARGE-OFFS(in thousands) | $ | % of Portfolio* | $ | % of Portfolio* | $ | % of Portfolio* | $ | % of Portfolio* | $ | % of Portfolio* | ||||||||||
| Residential loans | ||||||||||||||||||||
| Residential 1-4 family | $ 391 | 0.16% | $ 414 | 0.18% | $ 12,177 | 5.28% | $ 976 | 0.43% | $ 612 | 0.29% | ||||||||||
| Residential construction | – | – | – | – | – | – | – | – | – | – | ||||||||||
| Residential land | 532 | 5.31 | 165 | 1.58 | 4,099 | 34.79 | 620 | 4.83 | 735 | 5.26 | ||||||||||
| Total residential loans | 923 | 0.37 | 579 | 0.24 | 16,276 | 6.59 | 1,596 | 0.65 | 1,347 | 0.59 | ||||||||||
| Commercial loans | ||||||||||||||||||||
| Commercial business | 640 | 3.22 | 136 | 0.69 | 6,826 | 30.60 | 1,829 | 8.00 | 264 | 1.04 | ||||||||||
| Commercial real estate | 1,417 | 1.22 | 433 | 0.36 | 41,022 | 29.15 | 2,195 | 1.51 | 237 | 0.16 | ||||||||||
| Commercial construction | (3) | (0.07) | 635 | 16.12 | 3,067 | 53.06 | (3) | (0.05) | 314 | 3.93 | ||||||||||
| Commercial land | 804 | 4.94 | 2,052 | 12.15 | 33,995 | 118.23 | 4,824 | 14.94 | 2,127 | 5.70 | ||||||||||
| Total commercial loans | 2,858 | 1.83 | 3,256 | 2.04 | 84,910 | 42.98 | 8,845 | 4.28 | 2,942 | 1.34 | ||||||||||
| Consumer loans | ||||||||||||||||||||
| Home equity | 2,955 | 3.26 | 4,910 | 5.28 | 4,725 | 4.91 | 3,368 | 3.43 | 2,974 | 2.97 | ||||||||||
| Manufactured housing | 845 | 1.23 | 978 | 1.42 | 1,049 | 1.54 | 1,172 | 1.74 | 834 | 1.25 | ||||||||||
| Marine | 142 | 1.05 | 158 | 1.12 | 44 | 0.30 | 258 | 1.69 | 184 | 1.12 | ||||||||||
| Other consumer | 531 | 4.09 | 217 | 1.61 | 446 | 3.28 | 647 | 4.66 | 724 | 4.80 | ||||||||||
| Total consumer loans | 4,473 | 2.41 | 6,263 | 3.31 | 6,264 | 3.26 | 5,445 | 2.80 | 4,716 | 2.38 | ||||||||||
| Total net charge-offs | $ 8,254 | 1.39% | $ 10,098 | 1.71% | $107,450 | 16.87% | $ 15,886 | 2.45% | $ 9,005 | 1.39% | ||||||||||
| *Represents an annualized rate | ||||||||||||||||||||
The decrease in net charge-offs for the quarter ended December 31, 2011 as compared with the prior quarter was the result of the lower risk inherent in the loan portfolio after the bulk loan sale. The increase in commercial real estate charge-offs was primarily the result of the resolution of several nonperforming loans. Net charge-offs for the prior quarter were comprised of $7.9 million of charge-offs related to normal credit practices and $2.2 million of charge-offs on additional loans transferred to loans held for sale, the majority of which were related to existing loans in the pool.
The following table provides details on classified assets by category.
| December 31, 2011 | September 30, 2011 | |||||||
| CLASSIFIED ASSETS (in thousands) | Covered Classified | Non-covered Classified | Total Classified | Total Classified | ||||
| Residential loans | ||||||||
| Residential 1-4 family | $ 734 | $ 7,232 | $ 7,966 | $ 3,246 | ||||
| Residential land | 253 | 1,518 | 1,771 | 1,461 | ||||
| Total residential loans | 987 | 8,750 | 9,737 | 4,707 | ||||
| Commercial loans | ||||||||
| Commercial business | 4,386 | 9,466 | 13,852 | 12,689 | ||||
| Commercial real estate | 22,569 | 39,936 | 62,505 | 62,740 | ||||
| Commercial construction | 588 | 261 | 849 | 2,166 | ||||
| Commercial land | 3,516 | 10,697 | 14,213 | 15,550 | ||||
| Total commercial loans | 31,059 | 60,360 | 91,419 | 93,145 | ||||
| Consumer loans | ||||||||
| Home equity | 1,359 | 8,087 | 9,446 | 7,278 | ||||
| Manufactured housing | – | 3,461 | 3,461 | 2,922 | ||||
| Marine | 15 | 231 | 246 | 47 | ||||
| Other consumer | 89 | 256 | 345 | 298 | ||||
| Total consumer loans | 1,463 | 12,035 | 13,498 | 10,545 | ||||
| Total classified loans | 33,509 | 81,145 | 114,654 | 107,854 | ||||
| Loans held for sale | – | – | – | 50,063 | ||||
| Other repossessed assets acquired | – | 20,487 | 20,487 | 26,212 | ||||
| Total classified assets | $ 33,509 | $ 101,632 | $ 135,141 | $ 184,129 | ||||
| Classified assets/FFCH tier 1 capital + ALLL | 24.97% | 36.12% | 51.18% | |||||
| Classified assets excluding Loans Held for Sale/FFCH tier 1 capital + ALLL | 24.97 | 36.12 | 36.77 | |||||
Discontinued Operations Financial Statement Presentation
As a result of First Financial’s sales of its insurance agency subsidiary, First Southeast Insurance Services, Inc., which was completed on June 1, 2011, and its managing general insurance agency subsidiary, Kimbrell Insurance Group, Inc., which was completed on September 30, 2011, the financial condition, operating results, and the gain or loss on the sales, net of transaction costs and taxes, for these subsidiaries have been segregated from the financial condition and operating results of First Financial’s continuing operations throughout this release and, as such, are presented as discontinued operations. While all prior periods have been revised retrospectively to align with this treatment, these changes do not affect First Financial’s reported consolidated financial condition or operating results for any of the prior periods.
Quarterly Results of Operations
First Financial reported net income from continuing operations of $15.6 million for the three months ended December 31, 2011, compared with $2.9 million for the three months ended September 30, 2011 and $1.1 million for the three months ended December 31, 2010. The quarter ended December 31, 2011 included a $20.8 million pre-tax gain ($12.7 million after-tax) from the bulk loan sale. The changes in the key components of net income from continuing operations are discussed below.
Net interest income
Net interest margin, on a fully tax-equivalent basis, was 3.91% for the quarter ended December 31, 2011, as compared with 3.87% for the quarter ended September 30, 2011 and 3.83% for the quarter ended December 31, 2010. The increase over the linked quarter was primarily the result of a reduction in the rate paid on interest-bearing liabilities. The increase from the same quarter last year was primarily the result of the decrease in yield on interest-bearing liabilities exceeding the decrease in the yield on earning assets as First Financial continues to grow core deposits, especially noninterest-bearing deposits.
Net interest income for the quarter ended December 31, 2011 was $28.9 million, essentially unchanged from the prior quarter and a decrease of $1.3 million or 4.5% from the same quarter last year. The decrease from the same quarter last year was primarily the result of a decline in average earning assets due to the bulk loan sale, combined with the decline in net loans due to the generally lower loan demand from creditworthy borrowers and loan charge-offs.
Provision for loan losses
After determining what First Financial believes is an adequate allowance for loan losses based on the estimated risk inherent in the loan portfolio, the provision for loan losses is calculated based on the net effect of the change in the allowance for loan losses and net charge-offs. The provision for loan losses was $7.4 million for the quarter ended December 31, 2011, compared with $8.9 million for the linked quarter and $10.5 million for the same quarter last year. The provision for loan losses for the linked quarter included $1.4 million related to loans transferred to the bulk sale pool, and represents the net result of the incremental charge-offs on those loans less their related reserve release. The decrease from both prior periods was primarily the result of lower net charge-offs and lower classified loans at December 31, 2011.
Noninterest income
Noninterest income totaled $32.8 million for the quarter ended December 31, 2011, an increase of $18.5 million over the prior quarter and an increase of $22.2 million over the same quarter last year. The quarter ended December 31, 2011 included a $20.8 million pre-tax gain from the bulk loan sale. The prior quarter included net gains totaling $1.9 million related to the resolution of certain loans in the bulk loan pool. Noninterest income from core operations totaled $12.0 million and $12.3 for the quarters ended December 31, 2011 and September 30, 2011, respectively.
The increase over the same quarter last year was primarily the result of the gain on the bulk loan sale as well as higher service charges on deposit accounts ($821 thousand) due to higher transaction-related revenue from increases in both volume and fees.
Noninterest expense
Noninterest expense totaled $28.9 million for the quarter ended December 31, 2011, a decrease of $701 thousand or 2.4% over the linked quarter and essentially unchanged from the same quarter last year. The decrease from the linked quarter was primarily the result of lower OREO, net ($1.6 million) and lower professional services expenses ($502 thousand), partially offset by higher other expense ($1.2 million). The decrease in OREO costs was primarily the result of fewer valuation adjustments on properties held. The decrease in professional services was primarily the result of $521 thousand in legal and other advisory services in the prior quarter related to preparing the loans held in the bulk sale pool for final disposition. The increase in other expense was primarily the result of higher processing fees related to a new reward program for deposit customers, higher loss reserves for the reinsurance subsidiary, and higher operational losses related to uncollectible foreclosure expenses.
Noninterest expense was essentially unchanged from the same quarter last year as increases in other expense ($1.1 million) and OREO, net ($414 thousand) were essentially offset by reductions in salaries and employee benefits ($969 thousand), professional services ($523 thousand), and FDIC insurance and regulatory fees ($350 thousand). The variances in other expense and OREO, net were primarily the result of the factors discussed above. The decrease in salaries and employee benefits was primarily the result of lower staff levels due to initiatives implemented during 2011. The reduction in professional services was primarily the result of using external resources to assist in the implementation of several strategic initiatives including loss-sharing management, OREO management, and compensation studies during the December 31, 2010 quarter. The decrease in FDIC insurance and regulatory fees was primarily the result of the new assessment methodology implemented by the FDIC during 2011.
Cash Dividend Declared
On January 30, 2012, First Financial’s Board of Directors declared a quarterly cash dividend of $0.05 per share. The dividend is payable on February 27, 2012 to shareholders of record as of February 13, 2012.
Conference Call
R. Wayne Hall, president and CEO; Blaise B. Bettendorf, EVP and CFO; and Joseph W. Amy, EVP and CCO; will review the quarter’s results in a conference call at 2:00 pm (ET), January 30, 2012. The live audio webcast is available on First Financial’s website at www.firstfinancialholdings.com and will be available for 90 days.
About First Financial
First Financial Holdings, Inc. (“First Financial”) (Nasdaq:FFCH – News) is a Charleston, South Carolina financial services provider with $3.1 billion in total assets as of December 31, 2011. First Financial offers integrated financial solutions, including personal, business, and wealth management services. First Federal Savings and Loan Association (“First Federal”), which was founded in 1934 and is the primary subsidiary, serves individuals and businesses throughout coastal South Carolina, Florence, South Carolina and Wilmington, North Carolina. First Financial subsidiaries include: First Federal; First Southeast Investor Services, Inc., a registered broker-dealer; and First Southeast 401(k) Fiduciaries, Inc., a registered investment advisor. First Federal is the largest financial institution headquartered in the Charleston, South Carolina metropolitan area and the third largest financial institution headquartered in South Carolina, based on asset size. Additional information about First Financial is available at www.firstfinancialholdings.com.
Non-GAAP Financial Information
In addition to results presented in accordance with U.S. generally accepted accounting principles (“GAAP”), this press release includes non-GAAP financial measures such as the efficiency ratio, the tangible common equity to tangible assets ratio, tangible common book value per share, and pre-tax pre-provision earnings. First Financial believes these non-GAAP financial measures provide additional information that is useful to investors in understanding its underlying performance, business, and performance trends and such measures help facilitate performance comparisons with others in the banking industry. Non-GAAP measures have inherent limitations, are not required to be uniformly applied, and are not audited. Readers should be aware of these limitations and should be cautious to their use of such measures. To mitigate these limitations, First Financial has procedures in place to ensure that these measures are calculated using the appropriate GAAP or regulatory components in their entirety and to ensure that its performance is properly reflected to facilitate consistent period-to-period comparisons. Although management believes the above non-GAAP financial measures enhance investors’ understanding of First Financial’s business and performance, these non-GAAP measures should not be considered in isolation, or as a substitute for GAAP basis financial measures.
In accordance with industry standards, certain designated net interest income amounts are presented on a taxable equivalent basis, including the calculation used in the efficiency ratio.
First Financial believes the exclusion of goodwill and other intangible assets facilitates the comparison of results for ongoing business operations. The tangible common equity (“TCE”) ratio and tangible common book value per share (“TBV”) have become a focus of some investors, analysts and banking regulators. Management believes these measures may assist in analyzing First Financial’s capital position absent the effects of intangible assets and preferred stock. Because TCE and TBV are not formally defined by GAAP or codified in the federal banking regulations, these measures are considered to be non-GAAP financial measures. However, analysts and banking regulators may assess First Financial’s capital adequacy using TCE or TBV, therefore, management believes that it is useful to provide investors the ability to assess its capital adequacy on the same basis.
First Financial believes that pre-tax, pre-provision earnings are a useful measure in assessing its core operating performance, particularly during times of economic stress. This measurement, as defined by management, represents total revenue (net interest income plus noninterest income) less noninterest expense. As recent results for the banking industry demonstrate, credit writedowns, loan charge-offs, and related provisions for loan losses can vary significantly from period to period, making a measure that helps isolate the impact of credit costs on profitability important to investors.
Please refer to the Selected Financial Information table and the Non-GAAP Reconciliation table later in this release for additional information.
Forward-Looking Statements
Statements in this release that are not statements of historical fact, including without limitation, statements that include terms such as “believes,” “expects,” “anticipates,” “estimates,” “forecasts,” “intends,” “plans,” “targets,” “potentially,” “probably,” “projects,” “outlook,” or similar expressions or future conditional verbs such as “may,” “will,” “should,” “would,” or “could” constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements regarding First Financial’s future financial and operating results, plans, objectives, expectations and intentions involve risks and uncertainties, many of which are beyond First Financial’s control or are subject to change. No forward-looking statement is a guarantee of future performance and actual results could differ materially. Factors that could cause or contribute to such differences include, but are not limited to, the general business environment, general economic conditions nationally and in the States of North and South Carolina, interest rates, the North and South Carolina real estate markets, the demand for mortgage loans, the credit risk of lending activities, including changes in the level and trend of delinquent and nonperforming loans and charge-offs, changes in First Federal’s allowance for loan losses and provision for loan losses that may be affected by deterioration in the housing and real estate markets; results of examinations by banking regulators, including the possibility that any such regulatory authority may, among other things, require First Federal to increase its allowance for loan losses, writedown assets, change First Federal’s regulatory capital position or affect its ability to borrow funds or maintain or increase deposits, which could adversely affect liquidity and earnings; First Financial’s ability to control operating costs and expenses, First Financial’s ability to successfully integrate any assets, liabilities, customers, systems, and management personnel acquired or may in the future acquire into its operations and its ability to realize related revenue synergies and cost savings within expected time frames and any goodwill charges related thereto, competitive conditions between banks and non-bank financial services providers, and regulatory changes including the Dodd-Frank Wall Street Reform and Consumer Protection Act. Other risks are also detailed in First Financial’s Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and current reports on Form 8-K filings with the Securities and Exchange Commission (“SEC”), which are available at the SEC’s website www.sec.gov. Other factors not currently anticipated may also materially and adversely affect First Financial’s results of operations, financial position, and cash flows. There can be no assurance that future results will meet expectations. While First Financial believes that the forward-looking statements in this release are reasonable, the reader should not place undue reliance on any forward-looking statement. In addition, these statements speak only as of the date made. First Financial does not undertake, and expressly disclaims any obligation to update or alter any statements, whether as a result of new information, future events or otherwise, except as required by applicable law.
| FIRST FINANCIAL HOLDINGS, INC. | |||||
| CONSOLIDATED BALANCE SHEETS (Unaudited) | |||||
| (in thousands) | December 31, 2011 | September 30, 2011 | June 30, 2011 | March 31, 2011 | December 31, 2010 |
| ASSETS | |||||
| Cash and due from banks | $ 61,400 | $ 54,307 | $ 60,905 | $ 59,495 | $ 48,340 |
| Interest-bearing deposits with banks | 15,275 | 31,630 | 4,094 | 5,167 | 5,064 |
| Total cash and cash equivalents | 76,675 | 85,937 | 64,999 | 64,662 | 53,404 |
| Investment securities | |||||
| Securities available for sale, at fair value | 404,550 | 412,108 | 418,967 | 383,229 | 372,277 |
| Securities held to maturity, at amortized cost | 20,486 | 21,671 | 21,977 | 21,962 | 21,948 |
| Nonmarketable securities – FHLB stock | 32,694 | 35,782 | 37,626 | 41,273 | 41,273 |
| Total investment securities | 457,730 | 469,561 | 478,570 | 446,464 | 435,498 |
| Loans | 2,385,457 | 2,355,280 | 2,372,069 | 2,559,845 | 2,583,367 |
| Less: Allowance for loan losses | 53,524 | 54,333 | 55,491 | 85,138 | 88,349 |
| Net loans | 2,331,933 | 2,300,947 | 2,316,578 | 2,474,707 | 2,495,018 |
| Loans held for sale | 48,303 | 94,872 | 84,288 | 19,467 | 28,528 |
| FDIC indemnification asset, net | 51,021 | 50,465 | 58,926 | 61,135 | 68,326 |
| Premises and equipment, net | 79,979 | 80,477 | 81,001 | 81,251 | 81,806 |
| Goodwill | – | – | – | 630 | 630 |
| Other intangible assets, net | 2,401 | 2,491 | 2,571 | 2,653 | 2,735 |
| Other assets | 98,922 | 121,560 | 129,332 | 108,891 | 94,256 |
| Assets of discontinued operations | – | – | 5,279 | 42,152 | 41,137 |
| Total assets | $ 3,146,964 | $ 3,206,310 | $ 3,221,544 | $ 3,302,012 | $ 3,301,338 |
| LIABILITIES | |||||
| Deposits | |||||
| Noninterest-bearing checking | $ 279,520 | $ 279,152 | $ 234,478 | $ 233,197 | $ 222,023 |
| Interest-bearing checking | 429,697 | 440,377 | 437,179 | 437,113 | 405,727 |
| Savings and money market | 522,496 | 505,059 | 506,236 | 501,924 | 482,717 |
| Retail time deposits | 791,544 | 824,874 | 854,202 | 893,064 | 991,253 |
| Wholesale time deposits | 215,941 | 253,395 | 283,650 | 279,482 | 307,892 |
| Total deposits | 2,239,198 | 2,302,857 | 2,315,745 | 2,344,780 | 2,409,612 |
| Advances from FHLB | 561,000 | 558,000 | 557,500 | 561,506 | 497,106 |
| Long-term debt | 47,204 | 47,204 | 47,204 | 47,204 | 47,204 |
| Other liabilities | 22,384 | 29,743 | 29,432 | 30,539 | 27,183 |
| Liabilities of discontinued operations | – | – | 5,099 | 6,456 | 4,911 |
| Total liabilities | 2,869,786 | 2,937,804 | 2,954,980 | 2,990,485 | 2,986,016 |
| SHAREHOLDERS’ EQUITY | |||||
| Preferred stock | 1 | 1 | 1 | 1 | 1 |
| Common stock | 215 | 215 | 215 | 215 | 215 |
| Additional paid-in capital | 196,002 | 195,790 | 195,597 | 195,361 | 195,090 |
| Treasury stock, at cost | (103,563) | (103,563) | (103,563) | (103,563) | (103,563) |
| Retained earnings | 187,367 | 173,587 | 174,300 | 219,088 | 221,304 |
| Accumulated other comprehensive (expense) income | (2,844) | 2,476 | 14 | 425 | 2,275 |
| Total shareholders’ equity | 277,178 | 268,506 | 266,564 | 311,527 | 315,322 |
| Total liabilities and shareholders’ equity | $ 3,146,964 | $ 3,206,310 | $ 3,221,544 | $ 3,302,012 | $ 3,301,338 |
| FIRST FINANCIAL HOLDINGS, INC. | ||||||||||
| CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) | ||||||||||
| Three Months Ended | ||||||||||
| (in thousands, except share data) | December 31, 2011 | September 30, 2011 | June 30, 2011 | March 31, 2011 | December 31, 2010 | |||||
| INTEREST INCOME | ||||||||||
| Interest and fees on loans | $ 33,460 | $ 33,828 | $ 34,497 | $ 34,844 | $ 36,366 | |||||
| Interest and dividends on investments | 3,859 | 4,390 | 4,527 | 4,774 | 5,023 | |||||
| Other | 293 | 338 | 448 | 566 | 683 | |||||
| Total interest income | 37,612 | 38,556 | 39,472 | 40,184 | 42,072 | |||||
| INTEREST EXPENSE | ||||||||||
| Interest on deposits | 4,554 | 5,323 | 5,929 | 6,879 | 7,600 | |||||
| Interest on borrowed money | 4,159 | 4,169 | 4,127 | 4,018 | 4,224 | |||||
| Total interest expense | 8,713 | 9,492 | 10,056 | 10,897 | 11,824 | |||||
| NET INTEREST INCOME | 28,899 | 29,064 | 29,416 | 29,287 | 30,248 | |||||
| Provision for loan losses | 7,445 | 8,940 | 77,803 | 12,675 | 10,483 | |||||
| Net interest income (loss) after provision for loan losses | 21,454 | 20,124 | (48,387) | 16,612 | 19,765 | |||||
| NONINTEREST INCOME | ||||||||||
| Service charges on deposit accounts | 7,099 | 7,196 | 6,982 | 6,381 | 6,278 | |||||
| Mortgage and other loan income | 2,681 | 2,743 | 2,051 | 1,124 | 2,642 | |||||
| Trust and plan administration | 1,192 | 1,333 | 1,116 | 1,112 | 1,177 | |||||
| Brokerage fees | 532 | 588 | 657 | 666 | 514 | |||||
| Other | 650 | 647 | 670 | 675 | 503 | |||||
| Gains on sold loan pool, net | 20,796 | 1,900 | – | – | – | |||||
| Net securities (loses) gains | (180) | (169) | (54) | 1,297 | (534) | |||||
| Total noninterest income | 32,770 | 14,238 | 11,422 | 11,255 | 10,580 | |||||
| NONINTEREST EXPENSE | ||||||||||
| Salaries and employee benefits | 14,511 | 14,672 | 15,373 | 17,396 | 15,480 | |||||
| Occupancy costs | 2,144 | 2,188 | 2,116 | 2,208 | 2,058 | |||||
| Furniture and equipment | 1,870 | 1,725 | 1,769 | 1,825 | 1,725 | |||||
| Other real estate owned, net | 1,541 | 3,115 | 800 | (133) | 1,127 | |||||
| FDIC insurance and regulatory fees | 830 | 576 | 850 | 1,484 | 1,180 | |||||
| Professional services | 1,019 | 1,521 | 1,094 | 1,326 | 1,542 | |||||
| Advertising and marketing | 792 | 868 | 810 | 993 | 562 | |||||
| Other loan expense | 1,043 | 990 | 1,099 | 925 | 902 | |||||
| Goodwill impairment | – | – | 630 | – | – | |||||
| Intangible asset amortization | 90 | 79 | 82 | 82 | 82 | |||||
| Other expense | 5,046 | 3,854 | 3,976 | 4,039 | 3,912 | |||||
| Total noninterest expense | 28,886 | 29,588 | 28,599 | 30,145 | 28,570 | |||||
| Income (loss) income from continuing operations before taxes | 25,338 | 4,774 | (65,564) | (2,278) | 1,775 | |||||
| Income tax (benefit) from continuing operations | 9,766 | 1,893 | (25,288) | (913) | 636 | |||||
| NET INCOME (LOSS) FROM CONTINUING OPERATIONS | 15,572 | 2,881 | (40,276) | (1,365) | 1,139 | |||||
| (Loss) income from discontinued operations, net of tax | – | (1,804) | (2,724) | 935 | 28 | |||||
| NET INCOME (LOSS) | $ 15,572 | $ 1,077 | $ (43,000) | $ (430) | $ 1,167 | |||||
| Preferred stock dividends | 813 | 813 | 812 | 812 | 813 | |||||
| Accretion on preferred stock discount | 153 | 151 | 149 | 147 | 144 | |||||
| NET INCOME (LOSS) AVAILABLE TO COMMON SHAREHOLDERS | $ 14,606 | $ 113 | $ (43,961) | $ (1,389) | $ 210 | |||||
| Net income (loss) per common share from continuing operations: | ||||||||||
| Basic | $ 0.88 | $ 0.12 | $ (2.50) | $ (0.14) | $ 0.01 | |||||
| Diluted | 0.88 | 0.12 | (2.50) | (0.14) | 0.01 | |||||
| Net (loss) income per common share from discontinued operations: | ||||||||||
| Basic | – | (0.11) | (0.16) | 0.06 | 0.00 | |||||
| Diluted | – | (0.11) | (0.16) | 0.06 | 0.00 | |||||
| Net income (loss) per common share: | ||||||||||
| Basic | 0.88 | 0.01 | (2.66) | (0.08) | 0.01 | |||||
| Diluted | 0.88 | 0.01 | (2.66) | (0.08) | 0.01 | |||||
| Average common shares outstanding: | ||||||||||
| Basic | 16,527 | 16,527 | 16,527 | 16,527 | 16,527 | |||||
| Diluted | 16,527 | 16,527 | 16,527 | 16,527 | 16,529 | |||||
| For the Quarters Ended | |||||||||
| December 31, 2011 | December 31, 2010 | Change in | |||||||
| (in thousands) | Average Balance | Interest | Average Rate | Average Balance | Interest | Average Rate | Average Balance | Interest | Basis Points |
| Earning Assets | |||||||||
| Interest-bearing deposits with banks | $ 10,212 | $ 4 | 0.16% | $ 11,587 | $ 6 | 0.21% | $ (1,375) | $ (2) | (5) |
| Investment securities1 | 469,925 | 3,859 | 3.41 | 452,900 | 5,023 | 4.57 | 17,025 | (1,164) | (116) |
| Loans2 | 2,428,743 | 33,460 | 5.48 | 2,614,918 | 36,366 | 5.52 | (186,175) | (2,906) | (3) |
| FDIC Indemnification Asset | 50,700 | 289 | 2.27 | 67,854 | 677 | 3.96 | (17,154) | (388) | (169) |
| Total Earning Assets | 2,959,580 | 37,612 | 5.06 | 3,147,259 | 42,072 | 5.32 | (187,679) | (4,460) | (26) |
| Interest-bearing Liabilities | |||||||||
| Deposits | 1,992,957 | 4,554 | 0.91 | 2,197,647 | 7,600 | 1.37 | (204,690) | (3,046) | (46) |
| Borrowings | 565,114 | 4,159 | 2.93 | 543,039 | 4,224 | 3.09 | 22,075 | (65) | (16) |
| Total interest-bearing liabilities | 2,558,071 | 8,713 | 1.35 | 2,740,686 | 11,824 | 1.71 | (182,615) | (3,111) | (36) |
| Net interest income | $ 28,899 | $ 30,248 | $(1,349) | ||||||
| Net interest margin | 3.91% | 3.83% | 8 | ||||||
| 1 Interest income used in the average rate calculation includes the tax equivalent adjustment of $145 thousand, and $157 thousand for the quarters ended December 31, 2011 and 2010, respectively, calculated based on a federal tax rate of 35%. | |||||||||
| 2 Average loans include loans held for sale and nonaccrual loans. Loan fees, which are not material for any of the periods, have been included in loan interest income for the rate calculation. | |||||||||
| FIRST FINANCIAL HOLDINGS, INC. | |||||
| SELECTED FINANCIAL INFORMATION (Unaudited) | For the Quarters Ended | ||||
| (in thousands, except ratios) | December 31, 2011 | September 30, 2011 | June 30, 2011 | March 31, 2011 | December 31, 2010 |
| Average for the Quarter | |||||
| Total assets | $ 3,153,286 | $ 3,201,416 | $ 3,294,350 | $ 3,310,796 | $ 3,323,825 |
| Investment securities | 469,925 | 468,360 | 464,277 | 435,568 | 452,900 |
| Loans | 2,428,743 | 2,442,071 | 2,566,827 | 2,607,161 | 2,614,918 |
| Allowance for loan losses | 54,178 | 55,503 | 81,025 | 88,086 | 87,605 |
| Deposits | 2,272,035 | 2,302,518 | 2,360,572 | 2,397,801 | 2,424,807 |
| Borrowings | 565,114 | 595,508 | 593,103 | 555,630 | 543,039 |
| Shareholders’ equity | 279,066 | 267,404 | 302,996 | 313,663 | 318,202 |
| Performance Metrics from Continuing Operations | |||||
| Return on average assets | 1.98% | 0.36% | (4.89)% | (0.16)% | 0.14% |
| Return on average shareholders’ equity | 22.32 | 4.31 | (53.17) | (1.74) | 1.43 |
| Net interest margin (FTE) 1 | 3.91 | 3.87 | 3.83 | 3.83 | 3.83 |
| Efficiency ratio (non-GAAP) | 70.12% | 70.90% | 69.69% | 76.53% | 68.81% |
| Pre-tax pre-provision earnings (non-GAAP) | $ 32,783 | $ 13,714 | $ 12,239 | $ 10,397 | $ 12,258 |
| Performance Metrics From Consolidated Operations | |||||
| Return on average assets | 1.98% | 0.13% | (5.22)% | (0.05)% | 0.14% |
| Return on average shareholders’ equity | 22.32 | 1.61 | (56.77) | (0.55) | 1.47 |
| Asset Quality Metrics | |||||
| Allowance for loan losses as a percent of loans | 2.24% | 2.31% | 2.34% | 3.33% | 3.42% |
| Allowance for loan losses as a percent of nonperforming loans | 112.19 | 126.64 | 130.36 | 54.48 | 56.41 |
| Nonperforming loans as a percent of loans | 2.00 | 1.82 | 1.79 | 6.10 | 6.06 |
| Nonperforming assets as a percent of loans and other repossessed assets acquired2 | 2.83 | 4.48 | 4.63 | 7.05 | 6.77 |
| Nonperforming assets as a percent of total assets | 2.17 | 3.38 | 3.51 | 5.52 | 5.34 |
| Net loans charged-off as a percent of average loans (annualized) | 1.39% | 1.71 | 16.87 | 2.45 | 1.39 |
| Net loans charged-off | $ 8,254 | $ 10,098 | $ 107,450 | $ 15,886 | $ 9,005 |
| Asset Quality Metrics excluding Nonperforming Loans Held For Sale | |||||
| Nonperforming assets excluding nonperforming loans held for sale as a percent of loans and other repossessed assets acquired | 2.83% | 2.82% | 2.93% | 7.05% | 6.77% |
| Nonperforming assets excluding nonperforming loans held for sale as a percent of total assets | 2.17 | 2.10 | 2.18 | 5.52 | 5.34 |
| Asset Quality Metrics Excluding Covered Loans | |||||
| Allowance for loan losses as a percent of non-covered loans | 2.39% | 2.47% | 2.51% | 3.57% | 3.68% |
| Allowance for loan losses as a percent of non-covered nonperforming loans | 177.35 | 227.09 | 216.35 | 60.79 | 61.83 |
| Nonperforming loans as a percent of non-covered loans | 1.34 | 1.09 | 1.16 | 5.87 | 5.95 |
| Nonperforming assets as a percent of non-covered loans and other repossessed assets acquired2 | 1.88 | 3.58 | 3.91 | 6.65 | 6.46 |
| Nonperforming assets as a percent of total assets | 1.35 | 2.52 | 2.76 | 4.84 | 4.72 |
| Asset Quality Metrics Excluding Covered Loans and Nonperforming Loans Held for Sale | |||||
| Nonperforming assets excluding nonperforming loans held for sale as a percent of non-covered loans and other repossessed assets acquired | 1.88% | 1.79% | 2.07% | 6.65% | 6.46% |
| Nonperforming assets excluding nonperforming loans held for sale as a percent of total assets | 1.35 | 1.23 | 1.43 | 4.84 | 4.72 |
| 1 Net interest margin is presented on an annual basis, includes taxable equivalent adjustments to interest income and is based on a federal tax rate of 35%. | |||||
| 2 Nonperforming loans held for sale in the amount of $39,412, and $42,656 thousand is included in loans at September 30, 2011 and June 30, 2011, respectively. | |||||
| FIRST FINANCIAL HOLDINGS, INC. | |||||
| Non-GAAP Reconciliation (Unaudited) | For the Quarters Ended | ||||
| (in thousands, except share data) | December 31, 2011 | September 30, 2011 | June 30, 2011 | March 31, 2011 | December 31, 2010 |
| Efficiency Ratio from Continuing Operations | |||||
| Net interest income (A) | $ 28,900 | $ 29,064 | $ 29,416 | $ 29,287 | $ 30,248 |
| Taxable equivalent adjustment (B) | 145 | 159 | 144 | 144 | 157 |
| Noninterest income (C) | 32,770 | 14,238 | 11,422 | 11,255 | 10,580 |
| Gains on sold loan pool, net (D) | 20,796 | 1,900 | – | – | – |
| Net securities gains (losses) (E) | (180) | (169) | (54) | 1,297 | (534) |
| Noninterest expense (F) | 28,887 | 29,588 | 28,599 | 30,145 | 28,570 |
| Efficiency Ratio: F/(A+B+C-D-E) (non-GAAP) | 70.12% | 70.90% | 69.69% | 76.53% | 68.81% |
| Tangible Assets and Tangible Common Equity | |||||
| Total assets | $ 3,146,964 | $ 3,206,310 | $ 3,221,544 | $ 3,302,012 | $ 3,301,338 |
| Goodwill1 | – | – | (3,250) | (28,260) | (28,260) |
| Other intangible assets, net2 | (2,401) | (2,491) | (2,776) | (9,278) | (9,515) |
| Tangible assets (non-GAAP) | $ 3,144,563 | $ 3,203,819 | $ 3,215,518 | $ 3,264,474 | $ 3,263,563 |
| Total shareholders’ equity | $ 277,178 | $ 268,506 | $ 266,564 | $ 311,527 | $ 315,322 |
| Preferred stock | (65,000) | (65,000) | (65,000) | (65,000) | (65,000) |
| Goodwill1 | – | – | (3,250) | (28,260) | (28,260) |
| Other intangible assets, net2 | (2,401) | (2,491) | (2,776) | (9,278) | (9,515) |
| Tangible common equity (non-GAAP) | $ 209,777 | $ 201,015 | $ 195,538 | $ 208,989 | $ 212,547 |
| Shares outstanding, end of period (000s) | 16,527 | 16,527 | 16,527 | 16,527 | 16,527 |
| Tangible common equity to tangible assets (non-GAAP) | 6.67% | 6.27% | 6.08% | 6.40% | 6.51% |
| Tangible common book value per share (non-GAAP) | $ 12.69 | $ 12.16 | $ 11.83 | $ 12.65 | $ 12.86 |
| Pre-tax Pre-provision Earnings from Continuing Operations | |||||
| Income (loss) before income taxes | $ 25,338 | $ 4,774 | $ (65,564) | $ (2,278) | $ 1,775 |
| Provision for loan losses | 7,445 | 8,940 | 77,803 | 12,675 | 10,483 |
| Pre-tax pre-provision earnings (non-GAAP) | $ 32,783 | $ 13,714 | $ 12,239 | $ 10,397 | $ 12,258 |
| 1 Goodwill represents goodwill for Continuing Operations, as shown on the balance sheet, and includes goodwill for Discontinued Operations of $3,250 for the quarter ended June 30, 2011 and $27,630 for the quarters ended March 31, 2011, December 31, 2010, respectively. | |||||
| 2 Intangible assets represents intangible assets for Continuing Operations, as shown on the balance sheet, and includes intangible assets for Discontinued Operations of $205, $6,625, and $6,780, for the quarters ended June 30, 2011, March 31, 2011, and December 31, 2010, respectively. | |||||
http://tourism9.com/ http://vkins.com/
订阅：
博文 (Atom)