CENFED Financial Corp. announces second-quarter earnings.PASADENA, Calif.--(BUSINESS WIRE)--July 26, 1995--CENFED Financial Corp. (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 :CENF) Wednesday Wednesday: see week. announced second-quarter earnings of $1.3 million, representing 29 cents per share Cents per share The amount of a mutual fund's dividend or capital gains distributions that a shareholder will receive for each share owned. on a primary share basis, compared with $2.2 million and 51 cents per primary share in the corresponding period in 1994. At June June: see month. 30, 1995, total assets exceeded $2 billion for the first time in the company's history. For the six months ended June 30, 1995, net earnings totaled $2.9 million, or 65 cents per share, compared with $4.6 million, or $1.05 per share, in the first half of 1994. Earnings per share figures include the issuance of 322,050 additional common shares in the company's acquisition of United California California (kăl'ĭfôr`nyə), most populous state in the United States, located in the Far West; bordered by Oregon (N), Nevada and, across the Colorado River, Arizona (E), Mexico (S), and the Pacific Ocean (W). Savings Bank savings bank, financial institution that, until recently, performed only the following functions: receiving savings deposits of individuals, investing them, and providing a modest return to its depositors in the form of interest. (UCSB UCSB University of California at Santa Barbara UCSB University of Casual Sex and Beer ) in July July: see month. 1994. D. Tad (Telephone Answering Device) An answering machine. Lowrey, president and chief executive officer, remarked: "Earnings for the second quarter of 1995 reflected a 12 basis point decrease in our net interest margin from the previous quarter and softness in the adjustable rate mortgage This article is about the US mortgage type. For an international perspective, see Variable rate mortgage. An adjustable rate mortgage (ARM) is a mortgage loan where the interest rate on the note is periodically adjusted based on an index. market. We took a number of actions during the quarter that should offset some of the adverse effects of our current 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. and benefit future periods. Headcount head count or head·count n. 1. The act of counting people in a particular group. 2. The number of people counted in this way. Noun 1. was reduced during the quarter to reflect lower current and expected future mortgage volume. Our acquisition of Government Funding, a Los Angeles-based Small Business Administration lender will reduce our dependency dependency In international relations, a weak state dominated by or under the jurisdiction of a more powerful state but not formally annexed by it. Examples include American Samoa (U.S.) and Greenland (Denmark). on mortgage loan volumes, will provide asset diversification Diversification A risk management technique that mixes a wide variety of investments within a portfolio. It is designed to minimize the impact of any one security on overall portfolio performance. Notes: Diversification is possibly the greatest way to reduce the risk. and will improve our fee income and asset yields. Finally, we believe that the rise in our cost of funds Cost of Funds The interest rate paid on an outstanding loan. Notes: Money isn't free! Cost of funds is the cost of borrowing money. See also: Interest Rate Cost of funds Interest rate associated with borrowing money. is moderating, which should have a positive impact on our net interest margin." Core earnings on an after-tax basis After-tax basis The comparison basis used to analyze the net after-tax returns on a corporate taxable bond and a municipal tax-free bond. decreased by 29 percent in the second quarter of 1995, compared with 1994, primarily due to a combination of lower net interest income, higher operating expenses Operating expenses The amount paid for asset maintenance or the cost of doing business, excluding depreciation. Earnings are distributed after operating expenses are deducted. and lower commission income from sales of investment products. The company's core earnings exclude gains and losses on sales of investments and mortgage-backed securities Mortgage-backed securities (MSBs) Securities backed by a pool of mortgage loans. and results of real estate operations. Lowrey commented: "Even though operating expenses increased in the comparative periods, our efficiency has improved as reflected in a 26 basis point decrease in our operating expense Operating Expense The essential things that a company must purchase in order to maintain business. Notes: For example, the payment of employees wages are an operating expense. Also known as OPEX. ratio. Our core earnings reduction is principally a function of the spread compression of recent quarters that reflects movement through the business cycle and the unique competitive characteristics of Southern California Southern California, also colloquially known as SoCal, is the southern portion of the U.S. state of California. Centered on the cities of Los Angeles and San Diego, Southern California is home to nearly 24 million people and is the nation's second most populated region, ." At June 30, 1995, 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. totaled $18.5 million, representing a $4.6 million decrease from the beginning of the quarter that was principally attributable to the disposition of 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 . As a percentage of total assets, nonperforming assets were .92 percent at June 30, 1995, compared with .95 percent one year earlier. Loans delinquent delinquent 1) adj. not paid in full amount or on time. 2) n. short for an underage violator of the law as in juvenile delinquent. DELINQUENT, civil law. He who has been guilty of some crime, offence or failure of duty. 31 days or more at June 30, 1995, were 1.24 percent of loans held for investment. The allowance for loan losses at June 30, 1995, was .93 percent of loans held for investment and 107 percent of nonperforming loans. Loan originations The examples and perspective in this article or section may not represent a worldwide view of the subject. Please [ improve this article] or discuss the issue on the talk page. decreased for the third consecutive quarter and totaled $54.9 million for the three months ended June 30, 1995. Loans purchased for the quarter and year-to-date Year-to-date (YTD) The period beginning at the start of the calendar year up to the current date. totaled $73.7 million and $91.7 million, respectively, consisting almost exclusively of the 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 that the company acquired from Government Funding in late June 1995. Lowrey commented: "We believe that we can find alternatives to originating mortgage loans to meet our asset growth targets, including seeking loan purchase opportunities. Our diversification into SBA lending in a material way should carve out Carve out Usually occurs when a company decides to IPO one of their subsidiaries or divisions. The company usually only offers a minority share to the equity market. Also known as equity carve out. a niche that supports our profit and growth objectives as well." Non-interest income decreased by 34 percent in the second quarter of 1995, compared with the corresponding quarter in 1994. Gains on sales of securities and commission income from sales of investment products decreased by $502,000 and $230,000, respectively, in the second quarter of 1995, compared with the same quarter in 1994. Partially offsetting these non-interest income decreases was a $94,000 decrease in losses from real estate operations in the same comparative periods. Operating expenses for the second quarter of 1995 totaled $8.1 million, or 1.68 percent of average assets, compared with $7.5 million and 1.94 percent of average assets in the second quarter of 1994. Average assets in the second quarter of 1995 were 25 percent greater than in the corresponding period in 1994. In the second quarter of 1995, compared with the similar period in 1994, the company recorded increased compensation, deposit insurance and other operating expenses which were partially offset by an intangible amortization credit arising out of the company's July 1994 purchase of United California Savings Bank (UCSB). Compensation increased primarily due to lower levels of mortgage originations which eroded e·rode v. e·rod·ed, e·rod·ing, e·rodes v.tr. 1. To wear (something) away by or as if by abrasion: Waves eroded the shore. 2. To eat into; corrode. operating efficiencies in the company's wholesale single family lending unit and costs associated with the UCSB branch offices which were not owned in the 1994 quarter. Deposit insurance increases are a function of deposit growth in the comparative periods, as the company pays the lowest assessment rate available to SAIF-insured institutions. For the first six months of 1995 compared to 1994, operating expenses increased by $1.3 million but decreased by 20 basis points, as a percentage of average assets, to 1.75 percent. The company's effective income tax rate in the first quarter of 1995 was 17.8 percent, compared to 31.5 percent in the comparative period in 1994. For the first six months of 1995, the effective income tax rate was 20.0 percent, compared with 31.8 percent in the first half of 1994. In both the three- and six-month comparative periods, the effective tax rate in 1995 was lower than in 1994 primarily due to the greater proportion of income that was in the form of tax-exempt tax-ex·empt adj. 1. Not subject to taxation, as the capital or income of a philanthropic organization. 2. Producing interest that is exempt from income tax: tax-exempt bonds. n. municipal bond interest. CENFED Financial Corp. is the holding company for CenFed Bank, a Federal Savings Bank Noun 1. federal savings bank - a federally chartered savings bank FSB savings bank - a thrift institution in the northeastern United States; since deregulation in the 1980s they offer services competitive with many commercial banks which currently operates 20 branch offices in Los Angeles Los Angeles (lôs ăn`jələs, lŏs, ăn`jəlēz'), city (1990 pop. 3,485,398), seat of Los Angeles co., S Calif.; inc. 1850. , Orange, Riverside and San Bernardino San Bernardino, city, United States San Bernardino (săn bûr'nədē`nō), city (1990 pop. 164,164), seat of San Bernardino co., S Calif., at the foot of the San Bernardino Mts.; inc. 1854. counties in Southern California. -0-
CENFED Financial Corp.
Consolidated Financial Highlights
(Dollars in thousands)
At June 30, At Dec. 31,
1995 1994
FINANCIAL CONDITION DATA: Total assets $2,017,938 $1,849,683 Interest-earning assets $1,936,875 $1,761,580 Loans held for investment, net $1,383,884 $1,234,588 Loans held for sale, at lower of cost or market $ 90,410 $ 95,214 Mortgage-backed securities $ 320,636 $ 315,753 Real estate held for development and sale $ 9,917 $ 4,891 Total deposits $1,441,748 $1,310,505 Total borrowings $ 468,215 $ 436,112 Total stockholders' equity (1) $ 97,507 $ 91,221 Total common shares outstanding 4,485,917 4,463,974 Book value per common share (1) $ 21.74 $ 20.43 CenFed Bank's regulatory capital ratios: Tangible 5.36% 5.62% Core 5.46% 5.74% Risk-based 11.22% 12.16% -0-
At:
June 30, March 31,
1995 1995
NONPERFORMING ASSETS AND RESTRUCTURED LOANS: Nonaccrual loans $12,006 $12,590 Real estate owned 6,753 10,206 Total nonperforming assets 18,759 22,796 Troubled debt restructurings 250 250 Total nonperforming assets and restructured loans $19,009 $23,046 Allowances for losses $13,102 $12,373
At:
Dec. 31, Sept. 30, June 30,
1994 1994 1994
NONPERFORMING ASSETS AND RESTRUCTURED LOANS: Nonaccrual loans $10,245 $10,073 $10,937 Real estate owned 9,842 12,349 3,473 Total nonperforming assets 20,087 22,422 14,410 Troubled debt restructurings 354 354 354 Total nonperforming assets and restructured loans $20,441 $22,776 $14,764 Allowances for losses $12,529 $13,159 $ 7,207
For the three months For the six months
ended June 30, ended June 30,
1995 1994 1995 1994
OPERATING DATA: Net interest income before loss provisions $ 8,676 $ 9,249 $17,884 $19,279 Provisions for estimated losses 300 600 900 1,350 Net interest income after loss provisions 8,376 8,649 16,984 17,929 Total non-interest income 1,369 2,072 2,961 3,705 Total operating expense 8,113 7,501 16,281 14,954 Pretax earnings $ 1,632 $ 3,220 $ 3,664 $ 6,680 Net earnings $ 1,341 $ 2,206 $ 2,933 $ 4,555 Primary earnings per share 29 cents 51 cents 65 cents $ 1.05 OTHER DATA: Net interest margin (1) 1.96% 2.64% 2.02% 2.75% Loans originated $54,944 $156,277 $123,038 $282,282 Loans purchased $73,722 $14,286 $91,684 $33,444 (1) Yields on tax-exempt securities have been presented on a fully taxable equivalent basis.
CENFED Financial Corp.
Consolidated Statements of Financial Condition
In thousands, except share amounts
June 30, Dec. 31,
1995 1994
ASSETS:
Cash $ 16,737 $ 22,560
Federal funds sold 8,994 1,394
Cash and cash equivalents 25,731 23,954
Investment securities held to maturity,
at cost (market value of $89,099 at
June 30, 1995, and $81,812 at Dec.
31, 1994) 95,006 94,901
Investments securities available
for sale, at market value 37,945 19,730
MBS held to maturity, at cost
(market value of $190,897 at June 30,
1995, and $152,687 at Dec. 31, 1994) 188,076 157,936
MBS available for sale, at market value 132,560 157,817
Loans held for investment, net 1,383,884 1,234,588
Loans held for sale, at lower of cost
or market value 90,410 95,214
Accrued interest receivable 11,575 11,669
Real estate acquired in settlement
of loans 6,753 7,293
Real estate held for development and
sale 9,917 4,891
Premises and equipment, net, at cost 11,907 17,238
Intangible assets, net of accumulated
amortization (388) 701
Deferred income taxes 12,948 11,990
Other assets 11,614 11,761
$2,017,938 $1,849,683
LIABILITIES AND STOCKHOLDERS' EQUITY: Customer deposit accounts $1,441,748 $1,310,505 Securities sold under agreements to repurchase 189,815 147,412 Notes payable 22,900 23,000 FHLB advances 255,500 265,700 Other liabilities 10,468 11,845 Total liabilities 1,920,431 1,758,462
Commitments and contingent
liabilities
Common stock, 1 cent par value
Authorized shares: 14 million at
June 30, 1995, and Dec. 31, 1994
Outstanding shares: 4,485,917 at
June 30, 1995, and 4,463,974 at
Dec. 31, 1994 45 45
Additional paid-in capital 29,563 29,406
Retained earnings -- substantially
restricted 70,271 68,075
Unrealized gain/(loss) on securities
available for sale, net of tax (883) (4,629)
Deferred compensation -- retirement
plans (1,489) (1,676)
Total stockholders' equity 97,507 91,221
$2,017,938 $1,849,683
See notes to consolidated financial statements -0-
CENFED Financial Corp.
Consolidated Statements of Operations
(In thousands)
Three Months Ended Six Months Ended
June 30, June 30,
1995 1994 1995 1994
Interest and Dividend Income:
Loans and leases $ 24,671 $ 15,427 $ 47,238 $ 30,067
Investment securities and
short-term investments 1,947 1,512 3,691 3,132
Mortgage-backed securities 5,614 5,621 11,562 12,297
Total interest and
dividend income 32,232 22,560 62,491 45,496
Interest Expense:
Customer deposit accounts 17,273 8,976 32,114 17,795
Securities sold under
agreements to repurchase 2,570 1,735 5,156 2,893
FHLB advances 3,101 2,515 6,118 5,343
Other borrowings 612 85 1,219 186
Total interest expense 23,556 13,311 44,607 26,217
Net interest income before
loan loss provisions 8,676 9,249 17,884 19,279
Provision for estimated
loan losses 300 600 900 1,350
Net interest income after
loan loss provisions 8,376 8,649 16,984 17,929
Non-Interest Income (Expense): Loan and lease servicing fees 712 721 1,357 1,769 Customer deposit account fees 451 516 905 1,025 Gain on sale of investments -- 396 2 484 Gain on sale of loans and MBS 31 97 156 86 Loss from real estate operations (165) (259) (347) (749) Other 340 601 888 1,090 Total non-interest income 1,369 2,072 2,961 3,705 Operating Expenses: Compensation and employee benefits 4,058 3,502 8,228 7,146 Net occupancy 1,195 1,168 2,543 2,255 Deposit insurance premiums 749 536 1,498 1,073 Data processing 277 324 593 660 Check processing 158 160 277 304 Advertising 231 173 475 362 Intangible amortization (11) 453 (52) 624 Other 1,456 1,185 2,719 2,530 Total operating expenses 8,113 7,501 16,281 14,954 Earnings before taxes 1,632 3,220 3,664 6,680 Income taxes 291 1,014 731 2,125 Net earnings $ 1,341 $ 2,206 $ 2,933 $ 4,555 Earnings per share $ 0.29 $ 0.51 $ 0.65 $ 1.05 See notes to consolidated financial statements CONTACT: CENFED Financial Corp. Steven Ste´ven n. 1. Voice; speech; language. Ye have as merry a steven As any angel hath that is in heaven. - Chaucer. 2. An outcry; a loud call; a clamor. To set steven to make an appointment. P. Neiffer, 818/585-2595 or Morgen-Walke Associates Doug DOUG Dumb Old Utility Guy Sherk Sherk is a family name that may refer to:
Jill Ruja, Ellissa Grabowski Grabowski is the sirname of the following people
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