Bridge Capital Holdings Reports Financial Results for the Second Quarter and Six Months Ended June 30, 2009.Conference Call and Webcast Scheduled for Tuesday Tuesday: see week. , July July: see month. 28, 2009 at 9:00 a.m. Eastern Time SAN JOSE San Jose, city, United States San Jose (sănəzā`, săn hōzā`), city (1990 pop. 782,248), seat of Santa Clara co., W central Calif.; founded 1777, inc. 1850. , Calif. -- Bridge Capital Holdings (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on : BBNK), whose subsidiary is Bridge Bank, National Association, announced today its financial results for the second quarter and six months ended June June: see month. 30, 2009. The Company reported a net loss available to common shareholders of $(1.9) million, or $(0.29) per diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. common share, for the three months ended June 30, 2009 representing a decrease of $572,000, or 43%, compared to a net loss of $(1.3) million, or $(0.20) per diluted common share, for the same period one year ago. The net loss available to common shareholders was reduced by preferred dividends preferred dividend n. a payment of a corporation's profits to holders of preferred shares of stock. (See: preferred stock) of $1.1 million during the second quarter of 2009. There were no preferred dividends during the second quarter of 2008. The Company reported a net loss available to common shareholders of $(2.6) million, or $(0.39) per diluted common share, for the six months ended June 30, 2009 representing a decrease of $2.8 million, or 1,425%, compared to net income of $195,000, or $0.03 per diluted common share, for the same period one year ago. The net loss available to common shareholders was reduced by preferred dividends of $2.1 million during the first six months of 2009. There were no preferred dividends during the first six months of 2008. "During the second quarter, we made solid progress in significantly reducing our CRE CRE Commercial Real Estate CRE Corporate Real Estate CRE Commission for Racial Equality (Scotland) CRE CCD (Charge Coupled Device) and Readout Electronics CRE Camp Response Element exposure while improving capital ratios and liquidity," said Daniel P. Myers, President and Chief Executive Officer of Bridge Capital Holdings and Bridge Bank. "While we are seeing some "green shoots" of improvement in our business, the operating environment In computing, an operating environment is the environment in which users run programs, whether in a command line interface, such as in MS-DOS or the Unix shell, or in a graphical user interface, such as in the Macintosh operating system. remains uncertain. We believe our strong capital position and our reserve levels combined with our continued progress in reducing problem loans position us well for the present environment and the road ahead." Second Quarter Highlights * Capital ratios substantially exceed the regulatory calculation for being "well capitalized Capitalized Recorded in asset accounts and then depreciated or amortized, as is appropriate for expenditures for items with useful lives longer than one year. " with a Total Risk-Based Capital Ratio Risk-based capital ratio Bank requirement that there be a minimum ratio of estimated total capital to estimated risk-weighted asset. of 19.27%, a Tier I Capital Ratio of 15.08%, and a Tier I Leverage Ratio of 12.28%. * Provided $4.0 million to the allowance for credit losses which increased to 2.96% of gross loans, up from 2.77% at March 31, 2009 and 43% higher than the level of 2.07% one year earlier. At June 30, 2009 the allowance for credit losses represented coverage of 66.21% of nonperforming loans. * Nonperforming assets Nonperforming asset An asset that is not effectively producing income, such as an overdue loan. nonperforming asset An asset that produces no income. increased to $29.4 million, or 3.55% of total assets, as of June 30, 2009 from $28.3 million, or 3.21% of total assets at March 31, 2009. * Construction and land development loans together decreased $64.6 million, or 41%, from one year ago, which includes a decrease of $44.6 million, or 76%, in land development loans. * Total assets were $829.3 million as of June 30, 2009, representing an increase of $24.0 million, or 3%, over $805.4 million the same date one year ago, and compared to $881.6 million at March 31, 2009. * Total deposits decreased $27.7 million, or 4%, to $689.1 million as of June 30, 2009 compared to the same period one year ago, with demand deposits and core deposits representing 40.5% and 81.2%, respectively, of total deposits. Deposits were $733.1 million at March 31, 2009 with demand deposits and core deposits representing 39.7% and 80.2% of total deposits, respectively. * Non-interest income increased $611,000 to $2.3 million in the second quarter of 2009 from $1.7 million in the second quarter of 2008, primarily due to a gain recognized on the sale of "other real estate owned Real Estate Owned Property owned by a lender - usually a bank - after an unsuccessful sale at a foreclosure auction. This is common because most of the properties up for sale at these auctions are worth less than the total amount owed to the bank: the minimum bid in most ". For the quarter ended June 30, 2009, the Company's return on average assets and return on average equity were (0.39)% and (3.04)%, respectively, compared to (0.66)% and (7.70)%, respectively, for the same period in 2008. Return on average assets and return on average equity for the six months ended June 30, 2009 were (0.12)% and (0.92)%, respectively, compared to 0.05% and 0.57%, respectively, for the same period one year earlier. Net Interest Income and Margin Net interest income of $9.7 million for the quarter ended June 30, 2009 represented a decrease of approximately $2.0 million, or 17%, from $11.7 million for the same quarter one year earlier and was primarily attributed to the decrease in short-term interest rates Short-term interest rates Interest rates on loan contracts-or debt instruments such as Treasury bills, bank certificates of deposit or commerical paper-having maturities of less than one year. Often called money market rates. , lower balance sheet leverage and increased levels of nonperforming loans. Average earning assets Earning Assets Any income-earning asset owned by a company. Notes: These assets are generally interest-bearing accounts, bonds, and securities available for sale. See also: Asset, Asset Valuation, Earnings, Net Interest Margin of $817.3 million for the quarter ended June 30, 2009 increased $54.8 million, or 7%, compared to $762.6 million for the same quarter in 2008. The Company's loan-to-deposit ratio, a measure of leverage, averaged 87.39% during the quarter ended June 30, 2009, which represented a decrease compared to an average of 97.54% for the same quarter of 2008. For the six months ended June 30, 2009, net interest income of $19.3 million represented a decline of $4.4 million, or 19%, from $23.8 million for the six months ended 2008 and was primarily attributed to the decrease in short-term interest rates, lower balance sheet leverage and increased levels of nonperforming loans. Average earning assets of $841.5 million for the six months ended June 30, 2009 increased $93.2 million, or 12%, compared to $748.4 million for the same period one year ago. The Company's loan-to-deposit ratio, a measure of leverage, averaged 89.67% during the six months ended June 30, 2009, which represented a decrease compared to an average of 97.59% for the same period of 2008. Changes in short-term interest rates impact growth in net interest income as the interest rate earned on a majority of the Company's assets, specifically the loan portfolio, adjust with changes in short-term Short-term Any investments with a maturity of one year or less. short-term 1. Of or relating to a gain or loss on the value of an asset that has been held less than a specified period of time. market rates. As such, the nature of the Company's balance sheet is that over time as short-term interest rates change, income on interest earning assets has a greater impact on net interest income than interest paid on liabilities. The Company's prime rate averaged 3.25% and 3.25%, respectively, in the quarter and six months ended June 30, 2009 compared to 5.08% and 5.65%, respectively, in the same periods one year earlier. The Company's net interest margin for the quarter ended June 30, 2009 was 4.76% compared to 6.18% for the same period one year earlier, primarily due to lower short-term interest rates and lower balance sheet leverage. In addition, an increased level of nonperforming assets resulted in a negative impact of approximately 23 basis points in the second quarter of 2009 from reversed or foregone fore·gone v. Past participle of forego1. adj. Having gone before; previous. Usage Note: The word foregone has recently developed a new meaning as a truncation of the phrase interest. The net interest margin for the six months ended June 30, 2009 was 4.64% compared to 6.38% for the six months ended June 30, 2008 which was also primarily the result of lower short-term interest rates and lower balance sheet leverage. Nonperforming loans had a negative impact on net interest margin of approximately 21 basis points in 2009. Non-Interest Income The Company's non-interest income for the quarter and six months ended June 30, 2009 was $2.3 million and $6.3 million, respectively, compared to $1.7 million and $3.4 million, respectively, for the same periods one year ago. The increase in non-interest income for the second quarter of 2009 compared to the same period one year ago was primarily due to a gain of $675,000 recognized on the sale of "other real estate owned". The increase in non-interest income for the six months ended June 30, 2009 compared to the same period one year ago was primarily attributable to the recognition of $3.0 million from the acceleration of the deferred gain on interest rate swaps Interest Rate Swap A deal between banks or companies where borrowers switch floating-rate loans for fixed rate loans in another country. These can be either the same or different currencies. terminated during the fourth quarter of 2008. Excluding the impact of the gain recognized on "other real estate owned" and the impact of accounting related to hedging strategies, non-interest income is primarily comprised of foreign exchange fee income, deposit service charges, and gains on the sale of SBA SBA abbr. Small Business Administration Noun 1. SBA - an independent agency of the United States government that protects the interests of small businesses and ensures that they receive a fair share of government loans. Net interest income and non-interest income comprised total revenue of $12.0 million for the three months ended June 30, 2009 compared to $13.4 million for the same period one year earlier, representing a decrease of $1.4 million, or 11%. For the six months ended June 30, 2009, total revenue of $25.7 million represented a decrease of $1.5 million, or 5%, from $27.1 million for the six months ended June 30, 2008. Non-Interest Expense Non-interest expense was $9.3 million and $18.8 million for the quarter and six months ended June 30, 2009, respectively, compared to $9.5 million and $18.2 million, respectively, for the same periods in 2008. Salary and benefits expense for the quarter ended June 30, 2009 was $5.1 million, representing a decrease of $811,000 from $5.9 million in the same period of 2008. Salary and benefits expense for the six months ended June 30, 2009 was $10.7 million, a decrease of $894,000 from $11.6 million in the same period of 2008. As of June 30, 2009 the Company employed 162 full-time equivalents Full-time equivalent (FTE) is a way to measure a worker's involvement in a project, or a student's enrollment at an educational institution. An FTE of 1.0 means that the person is equivalent to a full-time worker, while an FTE of 0.5 signals that the worker is only half-time. (FTE FTE Full-Time Equivalent FTE Full-Time Employee FTE Full-Time Equivalency FTE Full Time Employment FTE Foundation for Teaching Economics FTE Full Time Enrollment FTE For the Enterprise (SQL) FTE Fund for Theological Education ) compared to 178 FTE on the same date one year earlier. During the second quarter of 2009, the Company paid $365,000 for the FDIC FDIC See: Federal Deposit Insurance Corporation FDIC See Federal Deposit Insurance Corporation (FDIC). special assessment levied on all banks that hold insured deposits. The Company's efficiency ratio, the ratio of non-interest expense to revenues, was 77.74% and 73.25% for the quarter and six months ended June 30, 2009 compared to 70.77% and 67.23%, respectively, in the same periods one year earlier. Balance Sheet Bridge Capital Holdings reported total assets at June 30, 2009 of $829.3 million, compared to $805.4 million on the same date one year ago. The increase in total assets represented growth of $24.0 million, or 3%, compared to June 30, 2008. Total assets at June 30, 2009 compared to $947.6 million at December 31, 2008 representing a decrease of $118.3 million, or 13%. The decrease in total assets compared to December 31, 2008 was primarily due to decreases in wholesale borrowings and deposits in response to improved liquidity. The Company's total deposits were $689.1 million as of June 30, 2009, compared to total deposits of $716.8 million as of June 30, 2008. The decrease in deposits was $27.7 million, or 4%, compared to June 30, 2008. Demand deposits represented 40.5% of total deposits at June 30, 2009, up from 32.6% at June 30, 2008. The Company reported total gross loans outstanding at June 30, 2009 of $606.5 million, which represented a decrease of $100.6 million, or 14%, from $707.1 million for the same date one year earlier. The decrease in gross loans included a decrease of $64.6 million, or 41%, in construction and land development loans. In addition, de-leveraging by commercial borrowers resulted in a decrease in commercial and industrial loan balances of $30.8 million, or 11%. "In the past year we have weathered the severe economic downturn Downturn The transition point between a rising, expanding economy to a falling, contracting one. downturn A decline in security prices or economic activity following a period of rising or stable prices or activity. with a focused and equally urgent response," noted Thomas (language) Thomas - A language compatible with the language Dylan(TM). Thomas is NOT Dylan(TM). The first public release of a translator to Scheme by Matt Birkholz, Jim Miller, and Ron Weiss, written at Digital Equipment Corporation's Cambridge Research Laboratory runs A. Sa, Executive Vice President and Chief Financial Officer of Bridge Capital Holdings and Bridge Bank. "We have significantly improved the risk profile of the Company, in part by reducing our exposures in the most impacted portions of the loan portfolio, which is reflected in loan totals and the size of the balance sheet. This has not only reduced credit risk but has also served to support liquidity and capital for opportunities ahead." Credit Quality At June 30, 2009, nonperforming assets totaled $29.4 million, or 3.55% of total assets, compared to $28.3 million, or 3.21% of total assets as of March 31, 2009, and $28.9 million, or 3.58% of total assets, on the same date one year earlier. The nonperforming assets at June 30, 2009 consisted of loans on nonaccrual or 90 days or more past due totaling $27.1 million, and other real estate owned valued at $2.3 million. Nonperforming loans at June 30, 2009 were comprised of loans with legal contractual balances totaling approximately $39.8 million reduced by impairment Impairment 1. A reduction in a company's stated capital. 2. The total capital that is less than the par value of the company's capital stock. Notes: 1. This is usually reduced because of poorly estimated losses or gains. 2. charges of $12.7 million which have been charged against the allowance for credit losses. The Company charged-off $4.2 million during the three months ended June 30, 2009 compared to $2.6 million charged-off during the three months ended June 30, 2008. During the six months ended June 30, 2009, the Company charged-off balances totaling $8.5 million which compared to $2.6 million charged-off during the same period of 2008. During the three and six months ended June 30, 2009 the Company recognized $23,000 and $308,000, respectively, in loan recoveries compared to $1,000 and $1,000, respectively, in loan recoveries during the same periods of 2008. Construction and land development loans together totaled approximately $94.0 million as of June 30, 2009, compared to $158.6 million one year earlier, representing a decrease of $64.6 million or 41%. Land development loans decreased by $44.6 million, or 76%, from $58.9 million at June 30, 2008 to $14.2 million on June 30, 2009. During the same period, unfunded commitments on construction and land development loans decreased by $64.9 million. The allowance for loan losses was $18.0 million, or 2.96% of total loans, at June 30, 2009, compared to $14.6 million, or 2.07% of total loans, at June 30, 2008. The provision for credit losses for the three and six months ended June 30, 2009 was $4.0 million and $7.7 million, respectively, compared to $6.2 million and $8.6 million, respectively, for the same periods in 2008. Capital Adequacy At June 30, 2009, shareholders' equity Shareholders' Equity A firms' total assets minus its total liabilities. Equivalently, it is share capital plus retained earnings minus treasury shares. Shareholders' equity is the amount by which a company is financed through common and preferred shares. in the Company totaled $109.2 million, which included approximately $53.9 million in preferred stock Stock shares that have preferential rights to dividends or to amounts distributable on liquidation, or to both, ahead of common shareholders. Preferred stock is given preference over common stock. Holders of preferred stock receive dividends at a fixed annual rate. and $(255,000) in other comprehensive income. Shareholders' equity at June 30, 2009 compared to $66.2 million on the same date one year earlier. The increase was the result of capital raised in the fourth quarter of 2008 in the form of $30.0 million of mandatorily convertible preferred stock Convertible Preferred Stock Preferred stock that includes an option for the holder to convert the preferred shares into a fixed number of common shares, usually anytime after a predetermined date. Also known as "convertible preferred shares". and $23.8 million of preferred stock issued under the US Treasury's Capital Purchase Program. The Company's tangible common equity ratio was 6.68% at June 30, 2009 compared to 6.19% at December 31, 2008. The Company's Total Risk-Based Capital Ratio, Tier I Capital Ratio, and Tier I Leverage Ratio of 19.27%, 15.08%, and 12.28%, respectively, were all substantially above the regulatory standards for "well-capitalized" institutions. Conference Call and Webcast Management will host a conference call tomorrow, July 28, 2009 at 9:00 a.m. Eastern time/6:00 a.m. Pacific time to further discuss the Company's financial results and answer questions. Individuals interested in participating in the conference call may do so by dialing 800.891.6020 from the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. , or 702.696.4830 from outside the United States. Those interested in listening to the conference call live via the Internet Internet Publicly accessible computer network connecting many smaller networks from around the world. It grew out of a U.S. Defense Department program called ARPANET (Advanced Research Projects Agency Network), established in 1969 with connections between computers at the may do so by visiting the Investor Relations Investor relations The process by which the corporation communicates with its investors. section of the Company's Web site at www.bridgebank.com. A telephone replay will be available through August 11, 2009 by dialing 800.642.1687 from the United States, or 706.645.9291 from outside the United States, and entering the conference ID 20657799. A webcast replay will be available for 90 days. About Bridge Capital Holdings Bridge Capital Holdings is the holding company for Bridge Bank, National Association. Bridge Capital Holdings was formed on October 1, 2004 and holds a Global Select listing on The NASDAQ Stock Market Nasdaq stock market The first electronic stock market listing over 5000 companies. The Nasdaq stock market comprises two separate markets, namely the Nasdaq National Market, which trades large, active securities and the Nasdaq Smallcap Market that trades emerging growth companies. under the trading symbol Trading symbol See: Ticker symbol BBNK. For additional information, visit the Bridge Capital Holdings website at http://www.bridgecapitalholdings.com. About Bridge Bank, N.A. Bridge Bank, N.A. is Silicon Valley's full-service professional business bank. The Bank is dedicated to meeting the financial needs of small, middle market, and emerging technology businesses. Bridge Bank provides its clients with a comprehensive package of business banking solutions delivered through experienced, professional bankers. For additional information, visit the Bridge Bank website at http://www.bridgebank.com. Forward-Looking Statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. Certain matters discussed in this press release constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995, and are subject to the safe harbors Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. created by that Act. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. They often include the words "believe," "expect," "anticipate," "intend," "plan," "estimate," or words of similar meaning, or future or conditional verbs such as "will," "would," "should," "could," or "may." Forward-looking statements are based on currently available information, expectations, assumptions, projections, and management's judgment about the Company, the banking industry and general economic conditions. These forward-looking statements are not guarantees of future performance, nor should they be relied upon as representing management's views as of any subsequent date. Future events are difficult to predict, and the expectations described above are necessarily subject to risk and uncertainty that may cause actual results to differ materially and adversely. Forward-looking statements involve significant risks and uncertainties and actual results may differ materially from those presented, either expressed or implied, in this press release. Factors that might cause such differences include, but are not limited to: the Company's ability to successfully execute its business plans and achieve its objectives; changes in general economic, real estate and financial market conditions, either nationally or locally in areas in which the Company conducts its operations; changes in interest rates; new litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute. When a person begins a civil lawsuit, the person enters into a process called litigation. or changes in existing litigation; future credit loss experience; increased competitive challenges and expanding product and pricing pressures among financial institutions; legislation or regulatory changes which adversely affect the Company's operations or business; loss of key personnel; changes in accounting policies or procedures as may be required by the Financial Accounting Standards Board Financial Accounting Standards Board (FASB) Board composed of independent members who create and interpret Generally Accepted Accounting Principles (GAAP). or other regulatory agencies regulatory agency Independent government commission charged by the legislature with setting and enforcing standards for specific industries in the private sector. The concept was invented by the U.S. ; and the ability to satisfy requirements related to the Sarbanes-Oxley Act See SOX. and other regulation on internal control. The reader should refer to the more complete discussion of such risks in Bridge Capital Holdings' annual reports on Forms 10-K and quarterly reports on Forms 10-Q on file with the Securities and Exchange Commission. The Company undertakes no obligation to publicly revise these forward-looking statements to reflect subsequent events or circumstances CIRCUMSTANCES, evidence. The particulars which accompany a fact. 2. The facts proved are either possible or impossible, ordinary and probable, or extraordinary and improbable, recent or ancient; they may have happened near us, or afar off; they are public or . [TABLE OMITTED] [TABLE OMITTED] [TABLE OMITTED] [TABLE OMITTED] [TABLE OMITTED] |
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