Customers Bancorp Reports Record Third Quarter and Nine Months Net Income
/EINPresswire.com/ -- WYOMISSING, PA--(Marketwired - October 28, 2015) -
- Q3 2015 Net Income up 23% and EPS up 19% over Q3 2014
- Q3 2015 Net Income of $0.50 Per Fully Diluted Share
- Nine Months 2015 Net Income up 31% and EPS up 27% over Nine Months 2014
- Tangible Book Value up 12.8% from Q3 2014 to $17.81 Per Share
- Deposits Grew by 35% and Loans Grew by 18% from Q3 2014
- Asset Quality Remains Very Strong
- BankMobile Expected to Meet its 1-Year Customer Acquisition Goal
- 2016 Fully Diluted EPS Estimated to be Between $2.40 and $2.50
Customers Bancorp, Inc. (NYSE: CUBI), the parent company of Customers Bank (collectively "Customers"), reported net income to common shareholders of $14.3 million for third quarter of 2015 ("Q3 2015") compared to net income to common shareholders of $11.7 million for third quarter of 2014 ("Q3 2014"), an increase of $2.6 million, or 23%. Fully diluted earnings per share for Q3 2015 was $0.50 compared to $0.42 fully diluted earnings per share for Q3 2014, an increase of $0.08 per share, or 19%. Average fully diluted shares for Q3 2015 were 28.7 million compared to average fully diluted shares for Q3 2014 of 28.0 million.
Customers also reported earnings of $39.3 million for the first nine months of 2015 compared to earnings of $30.0 million in the first nine months of 2014, an increase of $9.3 million, or 31%. Fully diluted earnings per share for the first nine months of 2015 was $1.37 compared to $1.08 for the first nine months of 2014, an increase of $0.29 per share, or 27%. Customers' 2015 earnings for the first nine months of 2015 includes a $6.0 million pre-tax provision for loan losses related to a fraudulent loan recorded in the second quarter of 2015.
Commenting on the record net income levels for the third quarter and nine months of 2015, Jay Sidhu, Chairman and CEO of Customers stated, "Customers is very pleased to report record earnings, $0.50 per share net income for the third quarter of 2015. As a company we set ambitious performance goals, build strategies to achieve those goals, and work hard to execute our plans. While maintaining superior risk management discipline, we continue to track toward achieving both our short-term and long-term goals. We believe we will report in excess of $1.00 per share in earnings for the second half of 2015, we expect to earn between $2.40 and $2.50 per share in 2016, and achieve our goals of reaching about a 1.0% return on assets, and 12.0% return on common equity in the next two years."
Other financial and business highlights for Q3 2015 include:
- Customers achieved a return on assets of 0.82% in Q3 2015 compared to 0.77% in Q3 2014, and achieved a return on common equity of 11.83% in Q3 2015 compared to 10.97% in Q3 2014, as earnings increased in Q3 2015.
- Total loans, including loans held for sale, increased $1.0 billion, or 18%, to $6.5 billion as of September 30, 2015 compared to total loans as of September 30, 2014 of $5.5 billion. Loans to mortgage companies increased $469 million, commercial and industrial loans (including owner occupied commercial real estate) increased $194 million, multi-family loans increased $287 million, non-owner occupied commercial real estate loans increased $84 million, and consumer loans decreased $40 million over the prior year.
- Total deposits increased $1.5 billion, or 35%, to $5.8 billion as of September 30, 2015 compared to total deposits of $4.3 billion as of September 30, 2014. Demand deposits increased $154 million, money market deposits increased $537 million and CDs increased $806 million over the prior year.
- Customers reported a $2.1 million provision for loan losses in Q3 2015.
- Non-performing loans totaled $17.8 million as of September 30, 2015, or 0.27% of total loans, compared to $14.0 million as of September 30, 2014, or 0.25% of total loans. The increase in the amount of non-performing loans reflects the $3.7 million net remaining balance of the fraudulent loan reported in Q2 2015 ($9.0 million original loan balance less $5.3 million charged off during Q3 2015). The total credit reserve for loan losses was 197% of the non-performing loan balance as of September 30, 2015.
- The Q3 2015 efficiency ratio was 54.0% compared to a 54.5% Q3 2014 efficiency ratio. The Q3 2015 efficiency ratio includes $1.6 million of net expense for BankMobile. Excluding BankMobile net expenses, the efficiency ratio would have been 51.2% for Q3 2015.
- Capital levels continue to exceed the "well-capitalized" thresholds established by regulation at both the holding company and bank.
- Consistent with Customers' stated intent to moderate balance sheet growth, Customers maintained total assets of $7.6 billion during Q3 2015 compared to Q2 2015, improving its capital ratios.
- The tangible book value per common share continued to increase, reaching $17.81 at September 30, 2015, compared to $16.43 at December 31, 2014 and $15.79 at September 30, 2014, an increase of 12.8% year-over-year.
Q3 2015 compared to Q2 2015:
Customers' Q3 2015 net income available to common shareholders of $14.3 million increased $3.3 million, or 30%, from earnings of $11.0 million for the second quarter of 2015 ("Q2 2015"). The increase in Q3 2015 compared to Q2 2015 earnings resulted primarily from recording a $6.0 million pre-tax provision for loan losses in Q2 2015 related to the identification of a fraudulent loan (considering the effect of income taxes, the effect of the provision for loan losses related to the fraudulent loan was to decrease net income $3.9 million in Q2 2015). During Q3 2015, Customers charged-off $5.3 million of the $9.0 million loan balance.
Other financial highlights for Q3 2015 compared to Q2 2015 include:
- Net interest margin in Q3 2015 of 2.79% increased approximately 6 basis points compared to the net interest margin for Q2 2015 of 2.73%. The net interest margin increase resulted primarily from continued discipline in pricing and an increase of $1.0 million in prepayment fees on multi-family loans in Q3 2015.
- Q3 2015 non-interest expense of $30.3 million was up approximately $4.6 million from Q2 2015 primarily due to net benefits received in Q2 2015 of $0.6 million from real estate owned sales and valuation adjustments compared to net costs in Q3 2015 of $1.7 million resulting primarily from the non-guaranteed portion of losses recognized on REO valuation adjustments, and reduction of the Pennsylvania shares tax expense (expense was reduced $2.3 million) in Q2 2015.
- Customers continued its planned strategy to moderate its balance sheet growth, with total assets largely unchanged as of September 30, 2015 compared to June 30, 2015 at $7.6 billion. Total loans, including loans held for sale, also remained flat as of September 30, 2015 compared to June 30, 2015 at $6.5 billion, with increases in commercial and industrial loans (including owner occupied commercial real estate) of $48 million, non-owner occupied real estate loans of $17 million and multi-family loans of $136 million offset by a decrease in loans to mortgage companies of $266 million.
- Deposits increased during Q3 2015 by $308 million, or 5.6%, to $5.8 billion.
- Customers sold approximately $36 million of multi-family loans at approximately a 1.0% gain during Q3 2015. There were no multi-family loan sales during Q2 2015.
The following table presents a summary of key earnings metrics for the three quarters ending September 30, 2015, June 30, 2015 and September 30, 2014:
CUSTOMERS BANCORP, INC. AND SUBSIDIARIES
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EARNINGS SUMMARY - UNAUDITED
---------------------------------------------------------------------------
(Dollars in thousands, except per-
share data)
Q3 Q2 Q3
2015 2015 2014
-------------------------------------
Net income available to common
shareholders $ 14,309 $ 11,049 $ 11,662
Basic earnings per common share
("EPS") $ 0.53 $ 0.41 $ 0.44
Diluted EPS $ 0.50 $ 0.39 $ 0.42
Average common shares outstanding -
basic 26,872,787 26,839,799 26,730,347
Average common shares outstanding -
diluted 28,741,129 28,680,664 27,984,840
Return on average assets 0.82% 0.65% 0.77%
Return on average common equity 11.83% 9.44% 10.97%
Net interest margin, tax equivalent 2.79% 2.73% 2.79%
Efficiency ratio 54.00% 48.40% 54.50%
Non-performing loans to total loans
(including held-for-sale and FDIC-
covered loans) 0.27% 0.16% 0.25%
Reserves to non-performing loans
(NPLs) 197.01% 369.90% 246.40%
Net charge-offs $ 5,657 $ 999 $ 325
Tangible book value per common share
(period end) (1) $ 17.81 $ 17.28 $ 15.79
Period end stock price $ 25.70 $ 26.89 $ 17.96
(1) Calculated as total equity less preferred stock and goodwill and other
intangibles divided by common shares outstanding at period end.
Net Interest Margin
Net interest margin ("NIM") was flat at 2.79% in Q3 2015 compared to Q3 2014, and increased 6 basis points from Q2 2015, as Customers maintained its NIM over a period in which the industry NIM has been rapidly contracting. The flat NIM of Q3 2015 compared to Q3 2014 resulted from a 6 basis point reduction in portfolio yields offset by an increase in prepayment fees on multi-family loans and FHLB dividends of $1.3 million, or approximately 6 basis points. The 6 basis point NIM increase in Q3 2015 compared to Q2 2015 resulted from higher prepayment fees on multi-family loans of $1.0 million. As the multi-family loan portfolio that was built largely in 2013 and 2014 seasons, it is expected that prospectively Customers will receive prepayment fees regularly.
Non-Interest Income
Q3 2015 non-interest income of $6.2 million increased $1.1 million compared to non-interest income of $5.1 million in Q3 2014, and decreased $0.2 million compared to non-interest income of $6.4 million in Q2 2015. The $1.1 million increase in Q3 2015 non-interest income compared to Q3 2014 non-interest income resulted primarily from a $0.6 million increase in mortgage warehouse transactional fees as a result of higher processing volume and a $0.4 million gain realized from the sale of multi-family loans. The $0.2 million Q3 2015 decrease in non-interest income compared to Q2 2015 resulted primarily from a $0.6 million credit valuation adjustment for derivative counterparty risk as the value of derivative receivable increased, offset in part by the $0.4 million gain realized from the sale of multi-family loans. Customers anticipates that it will continue with a low level of multi-family loan sales for the next several quarters.
Non-Interest Expense
Q3 2015 operating expenses of $30.3 million increased $5.6 million, or 22.8%, compared to Q3 2014, and increased $4.6 million compared to Q2 2015 operating expenses of $25.7 million. The Q3 2015 compared to Q3 2014 operating expense increase of $5.6 million resulted primarily from the $1.0 billion growth in Customers' loan portfolio, requiring increased staffing for loan origination and administrative support, higher occupancy expense, and technology fees (up $3.1 million), a $1.1 million increase in other real estate owned expense primarily resulting from the non-guaranteed portion of losses recognized on write-downs of REO in Q3 2015 and a $1.0 million increase in professional services primarily for consulting fees paid for loan reviews, legal services, and outsourcing of certain accounting and internal audit work and other expenses. The $4.6 million increase in Q3 2015 compared to Q2 2015 non-interest expenses resulted from a $2.3 million increase in other real estate owned expense reflecting the non-guaranteed portion of losses recognized on REO valuation adjustments in Q3 2015 compared to a net recovery of previous REO charge-offs and expenses in Q2 2015, and $2.3 million for reduction of the Pennsylvania shares tax expense estimate (expense was reduced $2.3 million) during Q2 2015.
Provision for Loan Losses and Asset Quality
The Q3 2015 provision for loan losses of $2.1 million includes a $1.2 million provision for third quarter net growth in the held-for-investment loan portfolio (predominately multi-family loans) of approximately $250 million. Non-performing loans as of September 30, 2015 were 0.27% of total loans. The September 30, 2015 total credit reserves of $35.0 million was 197% of total non-performing loans.
Other real estate owned decreased approximately $4.9 million in Q3 2015 to $8.4 million primarily due to valuation adjustments recorded on real estate properties covered by the Federal Deposit Insurance Corporation's purchase and assumption agreement based on agreed upon sales prices for properties under contract or current valuations. Total non-performing assets of $26.2 million as of September 30, 2015 was 0.34% of total assets.
Customers separates its loan portfolio into "covered" and "non-covered" loans for purposes of analyzing and managing asset quality. Covered loans are those loans that are covered by FDIC purchase and assumption, or loss sharing, agreements, and for which Customers is reimbursed 80% of allowable incurred losses. The FDIC guarantees of covered non-single family loans expired during Q3 2015, although the FDIC guarantees of residential mortgage loans will continue through Q3 2017. All non-single family loans have been reviewed and risk rated based on Customers' underwriting standards, and any estimated losses have been submitted to the FDIC for reimbursement. Guaranteed residential mortgage loans still covered under the FDIC guarantee totaled $13.8 million as of September 30, 2015.
Diversified Loan Portfolio
Customers is a Business Bank that principally focuses on four lending activities; commercial and industrial loans to privately held businesses, multi-family loans principally to high net worth families in the New York City area, selected commercial real estate loans, and banking services to privately held mortgage companies. Commercial and industrial loans, including owner-occupied commercial real estate loans, and non-owner-occupied commercial real estate loans, were approximately $900 million and $1.0 billion, respectively at September 30, 2015. Multi-family loans and mortgage warehouse loans, also considered commercial loans, were approximately $2.5 billion and $1.7 billion, respectively, at September 30, 2015.
Looking Ahead
"Building on the record third quarter earnings, we believe the fourth quarter of 2015 is positioned to be a strong quarter, and Customers expects to report in excess of $0.50 earnings per share for the period," Mr. Sidhu said. "We have worked hard to position our Company to meet its financial targets irrespective of the slope of the yield curve or level of short term rates and to sustain profitable operations when the markets are stressed," stated Mr. Sidhu. "We will continue our focus on our core businesses at Customers, growing commercial loans and core deposits, as we look to build our franchise value by building an exceptional business bank. BankMobile development also remains on plan. We expect to attract about 25,000 new customers within the first 12 months of operation of BankMobile," Sidhu concluded.
Conference Call
Date: Thursday, October 29, 2015
Time: 10:00 am ET
US Dial-in: 1-800-254-2821
International Dial-in: 1-913-312-1450
Conference ID: 370158
Webcast: http://public.viavid.com/index.php?id=116371
Please dial in at least 10 minutes before the start of the call to ensure timely participation. Slides accompanying the presentation will be available on the Company's website at http://customersbank.com/investor_relations.php prior to the call.
Institutional Background
Customers Bancorp, Inc. is a bank holding company located in Wyomissing, Pennsylvania engaged in banking and related businesses through its bank subsidiary, Customers Bank. Customers Bank is a community-based, full-service bank with assets of approximately $7.6 billion. A member of the Federal Reserve System with deposits insured by the Federal Deposit Insurance Corporation, Customers Bank provides a range of banking services to small and medium-sized businesses, professionals, individuals and families through offices in Pennsylvania, New York, Rhode Island, New Hampshire, Massachusetts, and New Jersey. Committed to fostering customer loyalty, Customers Bank uses a High Tech/High Touch strategy that includes use of industry-leading technology to provide customers better access to their money, as well as Concierge Banking® by appointment at customers' homes or offices 12 hours a day, seven days a week. Customers Bank offers a continually expanding portfolio of loans to small businesses, multi-family projects, mortgage companies and consumers.
Customers Bancorp, Inc. voting common shares are listed on the New York Stock Exchange under the symbol CUBI. Additional information about Customers Bancorp, Inc. can be found on the Company's website, www.customersbank.com.
"Safe Harbor" Statement
In addition to historical information, this press release may contain "forward-looking statements" within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include statements with respect to Customers Bancorp, Inc.'s strategies, goals, beliefs, expectations, estimates, intentions, capital raising efforts, financial condition and results of operations, future performance and business. Statements preceded by, followed by, or that include the words "may," "could," "should," "pro forma," "looking forward," "would," "believe," "expect," "anticipate," "estimate," "intend," "plan," or similar expressions generally indicate a forward-looking statement. These forward-looking statements involve risks and uncertainties that are subject to change based on various important factors (some of which, in whole or in part, are beyond Customers Bancorp, Inc.'s control). Numerous competitive, economic, regulatory, legal and technological factors, among others, could cause Customers Bancorp, Inc.'s financial performance to differ materially from the goals, plans, objectives, intentions and expectations expressed in such forward-looking statements. Customers Bancorp, Inc. cautions that the foregoing factors are not exclusive, and neither such factors nor any such forward-looking statement takes into account the impact of any future events. All forward-looking statements and information set forth herein are based on management's current beliefs and assumptions as of the date hereof and speak only as of the date they are made. For a more complete discussion of the assumptions, risks and uncertainties related to our business, you are encouraged to review Customers Bancorp, Inc.'s filings with the Securities and Exchange Commission, including its most recent annual report on Form 10-K for the year ended December 31, 2014 and subsequently filed quarterly reports on Form 10-Q. Customers Bancorp, Inc. does not undertake to update any forward-looking statement whether written or oral, that may be made from time to time by Customers Bancorp, Inc. or by or on behalf of Customers Bank.
CUSTOMERS BANCORP, INC. AND SUBSIDIARIES
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CONSOLIDATED STATEMENTS OF OPERATIONS FOR THE THREE MONTHS ENDED - UNAUDITED
----------------------------------------------------------------------------
(Dollars in thousands, except per
share data)
Q3 Q2 Q3
2015 2015 2014
----------- ----------- ------------
Interest income:
Loans receivable, including fees $ 46,291 $ 42,801 $ 39,640
Loans held for sale 14,006 13,522 8,503
Investment securities 2,283 2,253 2,361
Other 1,156 1,107 794
----------- ----------- ------------
Total interest income 63,736 59,683 51,298
Interest expense:
Deposits 9,022 8,145 6,179
Other borrowings 1,539 1,496 1,494
FHLB advances 1,556 1,799 1,711
Subordinated debt 1,685 1,685 1,700
----------- ----------- ------------
Total interest expense 13,802 13,125 11,084
----------- ----------- ------------
Net interest income 49,934 46,558 40,214
Provision for loan losses 2,094 9,335 5,035
----------- ----------- ------------
Net interest income after
provision for loan losses 47,840 37,223 35,179
Non-interest income:
Mortgage warehouse transactional
fees 2,792 2,799 2,154
Gain on sale of loans 1,131 827 695
Bank-owned life insurance 1,177 1,169 976
Deposit fees 265 247 192
Mortgage loans and banking income 167 287 212
Gain (loss) on sale of investment
securities (16) (69) -
Other 655 1,133 873
----------- ----------- ------------
Total non-interest income 6,171 6,393 5,102
Non-interest expense:
Salaries and employee benefits 14,981 14,448 12,070
FDIC assessments, taxes, and
regulatory fees 3,222 995 3,320
Professional services 2,673 2,792 1,671
Technology, communication and bank
operations 2,422 2,838 2,297
Occupancy 2,169 2,199 2,119
Other real estate owned expense
(income) 1,722 (580) 603
Advertising and promotion 330 429 261
Loan workout expense (income) 285 (13) 388
Other 2,503 2,552 1,950
----------- ----------- ------------
Total non-interest expense 30,307 25,660 24,679
----------- ----------- ------------
Income before tax expense 23,704 17,956 15,602
Income tax expense 8,415 6,400 3,940
----------- ----------- ------------
Net income 15,289 11,556 11,662
Preferred stock dividend 980 507 -
----------- ----------- ------------
Net income available to common
shareholders $ 14,309 $ 11,049 $ 11,662
=========== =========== ============
Basic earnings per common share $ 0.53 $ 0.41 $ 0.44
Diluted earnings per common share $ 0.50 $ 0.39 $ 0.42
CUSTOMERS BANCORP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS FOR THE NINE MONTHS ENDED - UNAUDITED
(Dollars in thousands, except per share data)
September 30, September 30,
2015 2014
------------- --------------
Interest income:
Loans receivable, including fees $ 132,185 $ 103,216
Loans held for sale 38,428 20,301
Investment securities 6,899 7,944
Other 4,625 1,805
------------- --------------
Total interest income 182,137 133,266
Interest expense:
Deposits 24,693 17,321
Other borrowings 4,523 3,834
FHLB advances 5,044 3,348
Subordinated debt 5,055 1,826
------------- --------------
Total interest expense 39,315 26,329
------------- --------------
Net interest income 142,822 106,937
Provision for loan losses 14,393 12,288
------------- --------------
Net interest income after provision for
loan losses 128,429 94,649
Non-interest income:
Mortgage warehouse transactional fees 7,864 6,128
Bank-owned life insurance 3,407 2,646
Gain on sale of loans 3,189 1,266
Deposit fees 691 618
Mortgage loans and banking income 605 2,175
Gain (loss) on sale of investment securities (85) 3,191
Other 2,626 3,298
------------- --------------
Total non-interest income 18,297 19,322
Non-interest expense:
Salaries and employee benefits 43,381 33,012
FDIC assessments, taxes, and regulatory fees 7,495 8,529
Professional services 7,378 5,834
Technology, communications and bank
operations 7,791 6,767
Occupancy 6,469 6,061
Other real estate owned 2,026 1,845
Advertising and promotion 1,106 1,104
Loan workout 541 1,306
Other 7,245 6,592
------------- --------------
Total non-interest expense 83,432 71,050
------------- --------------
Income before tax expense 63,294 42,921
Income tax expense 22,497 12,885
------------- --------------
Net income 40,797 30,036
Preferred stock dividend 1,487 -
------------- --------------
Net income available to common
shareholders $ 39,310 $ 30,036
============= ==============
Basic earnings per common share $ 1.47 $ 1.12
Diluted earnings per common share $ 1.37 $ 1.08
CUSTOMERS BANCORP, INC. AND SUBSIDIARIES
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CONSOLIDATED BALANCE SHEET - UNAUDITED
---------------------------------------------------------------------------
(Dollars in thousands)
September 30, December 31, September 30,
2015 2014 2014
------------- ------------- -------------
ASSETS
Cash and due from banks $ 80,475 $ 62,746 $ 89,728
Interest-earning deposits 302,924 308,277 241,578
------------- ------------- -------------
Cash and cash equivalents 383,399 371,023 331,306
Investment securities available
for sale, at fair value 418,945 416,685 409,303
Loans held for sale 1,730,002 1,435,459 1,395,720
Loans receivable 4,769,102 4,312,173 4,110,135
Allowance for loan losses (33,823) (30,932) (31,083)
------------- ------------- -------------
Total loans receivable, net
of allowance for loan losses 4,735,279 4,281,241 4,079,052
FHLB, Federal Reserve Bank, and
other restricted stock 63,514 82,002 81,772
Accrued interest receivable 16,512 15,205 13,744
FDIC loss sharing receivable 202 2,320 5,995
Bank premises and equipment,
net 11,567 10,810 11,147
Bank-owned life insurance 156,909 138,676 137,575
Other real estate owned 8,433 15,371 17,755
Goodwill and other intangibles 3,654 3,664 3,667
Other assets 71,055 52,914 45,399
------------- ------------- -------------
Total assets $ 7,599,471 $ 6,825,370 $ 6,532,435
============= ============= =============
LIABILITIES AND SHAREHOLDERS'
EQUITY
Demand, non-interest bearing $ 777,478 $ 546,436 $ 697,415
Interest-bearing deposits 5,007,716 3,986,102 3,586,725
------------- ------------- -------------
Total deposits 5,785,194 4,532,538 4,284,140
Federal funds purchased 50,000 - -
FHLB advances 985,900 1,618,000 1,594,500
Other borrowings 88,250 88,250 88,250
Subordinated debt 110,000 110,000 112,000
Accrued interest payable and
other liabilities 42,149 33,437 27,746
------------- ------------- -------------
Total liabilities 7,061,493 6,382,225 6,106,636
------------- ------------- -------------
Preferred stock 55,569 - -
Common stock 27,413 27,278 27,267
Additional paid in capital 360,903 355,822 354,561
Retained earnings 107,731 68,421 55,245
Accumulated other comprehensive
loss (5,405) (122) (3,020)
Treasury stock, at cost (8,233) (8,254) (8,254)
------------- ------------- -------------
Total shareholders'
equity 537,978 443,145 425,799
------------- ------------- -------------
Total liabilities &
shareholders' equity $ 7,599,471 $ 6,825,370 $ 6,532,435
============= ============= =============
CUSTOMERS BANCORP, INC. AND SUBSIDIARIES
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AVERAGE BALANCE SHEET / NET INTEREST MARGIN (UNAUDITED)
----------------------------------------------------------------------------
(Dollars in thousands)
Three Months Ended September 30,
-------------------------------------------
2015 2014
--------------------- ---------------------
Average Average
Average yield or Average yield or
Balance cost (%) Balance cost (%)
--------------------- ---------------------
Assets
Interest earning deposits $ 312,286 0.26 $ 244,013 0.25
Investment securities 377,157 2.42 421,213 2.24
Loans held for sale 1,720,863 3.23 1,014,068 3.33
Loans receivable 4,648,986 3.95 3,977,407 3.96
Other interest-earning assets 67,299 5.62 83,313 3.05
----------- -----------
Total interest earning assets 7,126,591 3.55 5,740,014 3.55
Non-interest earning assets 260,659 238,223
----------- -----------
Total assets $ 7,387,250 $ 5,978,237
=========== ===========
Liabilities
Total interest bearing deposits
(1) $ 4,938,317 0.72 $ 3,268,502 0.75
Borrowings 1,218,242 1.56 1,674,576 1.17
----------- -----------
Total interest bearing
liabilities 6,156,559 0.89 4,943,078 0.89
Non-interest bearing deposits
(1) 675,455 596,497
----------- -----------
Total deposits & borrowings 6,832,014 0.80 5,539,575 0.79
Other non-interest bearing
liabilities 19,998 16,596
----------- -----------
Total liabilities 6,852,012 5,556,171
Shareholders' equity 535,238 422,066
----------- -----------
Total liabilities and
shareholders' equity $ 7,387,250 $ 5,978,237
=========== ===========
Net interest margin 2.78 2.78
Net interest margin tax
equivalent 2.79 2.79
(1) Total costs of deposits (including interest bearing and non-interest
bearing) were 0.64% and 0.63% for the three months ended September 30, 2015
and 2014, respectively.
CUSTOMERS BANCORP, INC. AND SUBSIDIARIES
----------------------------------------------------------------------------
AVERAGE BALANCE SHEET / NET INTEREST MARGIN (UNAUDITED)
----------------------------------------------------------------------------
(Dollars in thousands)
Nine Months Ended September 30,
-------------------------------------------
2015 2014
--------------------- ---------------------
Average Average
Average yield or Average yield or
Balance cost (%) Balance cost (%)
--------------------- ---------------------
Assets
Interest earning deposits $ 295,485 0.26 $ 214,215 0.25
Investment securities 389,253 2.36 461,708 2.29
Loans held for sale 1,594,942 3.22 787,509 3.45
Loans receivable 4,472,704 3.95 3,458,930 3.99
Other interest-earning assets 73,368 7.40 61,961 3.03
----------- -----------
Total interest earning assets 6,825,752 3.57 4,984,323 3.57
Non-interest earning assets 268,799 220,389
----------- -----------
Total assets $ 7,094,551 $ 5,204,712
=========== ===========
Liabilities
Total interest bearing deposits
(1) $ 4,489,241 0.74 $ 3,028,465 0.76
Borrowings 1,399,478 1.40 1,136,675 1.06
----------- -----------
Total interest-bearing
liabilities 5,888,719 0.89 4,165,140 0.84
Non-interest-bearing deposits
(1) 684,466 615,956
----------- -----------
Total deposits & borrowings 6,573,185 0.80 4,781,096 0.74
Other non-interest bearing
liabilities 26,025 14,963
----------- -----------
Total liabilities 6,599,210 4,796,059
Shareholders' equity 495,341 408,653
----------- -----------
Total liabilities and
shareholders' equity $ 7,094,551 $ 5,204,712
=========== ===========
Net interest margin 2.80 2.87
Net interest margin tax
equivalent 2.80 2.88
(1) Total costs of deposits (including interest bearing and non-interest
bearing) were 0.63% and 0.64% for the nine months ended September 30, 2015
and 2014, respectively.
CUSTOMERS BANCORP, INC. AND SUBSIDIARIES ---------------------------------------------------------------------------- Asset Quality as of September 30, 2015 (Unaudited) ---------------------------------------------------------------------------- (Dollars in thousands)
----------------------------------------------------------------------------
Other Non
Non Real Performing Allowance
Total Accrual Estate Assets for loan
Loan Type Loans /NPLs Owned (NPAs) losses
----------------------------------------------------------------------------
New Century Originated
Loans
Legacy $ 43,084 $ 1,608 $ 2,811 $ 4,419 $ 1,219
Troubled debt
restructurings (TDRs) 2,094 931 - 931 59
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Total New Century
Originated Loans 45,178 2,539 2,811 5,350 1,278
----------------------------------------------------------------------------
Originated Loans
Multi-Family 2,399,387 - - - 9,206
Commercial & Industrial
(1) 844,814 6,283 151 6,434 10,187
Commercial Real Estate-
Non-Owner Occupied 860,225 3,947 - 3,947 3,521
Residential 109,730 8 - 8 1,876
Construction 89,382 - - - 1,106
Other Consumer 152 - - - 8
TDRs 540 - - - 5
----------------------------------------------------------------------------
Total Originated Loans 4,304,230 10,238 151 10,389 25,909
----------------------------------------------------------------------------
Acquired Loans
Covered 12,702 1,187 516 1,703 112
Non-Covered 353,723 1,126 4,955 6,081 482
TDRs Covered 522 - - - -
TDRs Non-Covered 7,498 2,692 - 2,692 -
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Total Acquired Loans 374,445 5,005 5,471 10,476 594
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Acquired Purchased
Credit-impaired Loans
Covered 626 - - - 284
Non-Covered 44,100 - - - 5,758
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Total Acquired Purchased
Credit-impaired Loans 44,726 - - - 6,042
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Deferred Origination
Fees/Unamortized
Premium/Discounts, net 523 - - - -
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Total Loans Held for
Investment 4,769,102 17,782 8,433 26,215 33,823
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Total Loans Held for Sale 1,730,002 - - - -
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Total Portfolio $6,499,104 $ 17,782 $ 8,433 $ 26,215 $ 33,823
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Total
Total NPLs / Reserves
Cash Credit Total to Total
Loan Type Reserve Reserves Loans NPLs
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New Century Originated
Loans
Legacy - $ 1219 3.73% 75.81%
Troubled debt
restructurings (TDRs) - 59 44.46% 6.34%
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Total New Century
Originated Loans - 1,278 5.62% 50.33%
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Originated Loans
Multi-Family - 9,206 -% -%
Commercial & Industrial
(1) - 10,187 0.74% 162.14%
Commercial Real Estate-
Non-Owner Occupied - 3,521 0.46% 89.21%
Residential - 1,876 0.01% 23,450.00%
Construction - 1,106 -% -%
Other Consumer - 8 -% -%
TDRs - 5 -% -%
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Total Originated Loans - 25,909 0.24% 253.07%
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Acquired Loans
Covered - 112 9.34% 9.44%
Non-Covered 1,209 1,691 0.32% 150.18%
TDRs Covered - - -% -%
TDRs Non-Covered - - 35.90% -%
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Total Acquired Loans 1,209 1,803 1.34% 36.02%
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Acquired Purchased
Credit-impaired Loans
Covered - 284 -% -%
Non-Covered - 5,758 -% -%
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Total Acquired Purchased
Credit-impaired Loans - 6,042 -% -%
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Deferred Origination
Fees/Unamortized
Premium/Discounts, net - - -% -%
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Total Loans Held for
Investment 1,209 35,032 0.37% 197.01%
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Total Loans Held for Sale - - -% -%
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Total Portfolio $ 1,209 $ 35,032 0.27% 197.01%
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(1) Commercial & industrial loans, including owner occupied commercial real estate.
Contacts:
Jay Sidhu
Chairman & CEO
610-935-8693
Richard Ehst
President & COO
610-917-3263
Investor Contact:
Robert Wahlman
CFO
610-743-8074
Legal Disclaimer:
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