Capital Crossing Bank Announces First Quarter Earnings.Business Editors BOSTON--(BUSINESS WIRE)--April 19, 2001 Capital Crossing Bank (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 :CAPX CAPX Capital Expenditure(s) cAPX cytosolic ascorbate peroxidase CAPX Capital Expense(s) CAPX Customer Accessible Parts eXpress (Grove Cranes) ) (the "Bank") announced consolidated net income for the quarter ended March 31, 2001 of $2,056,000 or $0.44 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. share, compared to $2,842,000 or $0.46 per diluted share for the same quarter in 2000. In the first quarter of 2001, the Bank purchased loans with outstanding principal balances of $84.9 million at a purchase price of $57.4 million, compared to the first quarter of 2000 wherein where·in adv. In what way; how: Wherein have we sinned? conj. 1. In which location; where: the country wherein those people live. 2. the Bank purchased loans with outstanding principal balances of $119.6 million at a purchase price of $114.8 million. The loans acquired in the first quarter of 2001 were acquired at a substantial discount because they carry a comparatively low weighted average coupon Weighted average Coupon The weighted average of the gross interest rates of mortgages underlying a pool as of the pool issue date; the balance of each mortgage is used as the weighting factor. rate of 5.12% and also because they are relatively long term in nature. "We continue to see the benefits and strength of our primary business strategy of acquiring loans at a discount," stated Nicholas Nicholas, Russian grand duke Nicholas (Nikolai Nikolayevich) (nyĭkəlī` nyĭkəlī`əvĭch), 1856–1929, Russian grand duke and army officer; first cousin of Czar Alexander III and grandson of Czar W. Lazares, the Bank's Chairman and Co-Chief Executive Officer. "The core earnings generated by these acquired loans resulted in relatively consistent net income despite quarter-to-quarter fluctuations in loan acquisitions and transactional income. In addition to our strong first quarter earnings, we are also pleased with our allowance for loan and lease losses as a percentage of non-performing loans A non-performing loan is a loan that is in default or close to being in default. Many loans become non-performing after being in default for 3 months, but this can depend on the contract terms. and leases and ratio of non-performing assets to total assets, which remained strong at 323.67% and .68%, respectively. Our earnings, combined with the continued execution of our stock repurchase Stock repurchase A firm's repurchase of outstanding shares of its common stock. program, resulted in a $.61 increase in our book value per share from $15.62 at December December: see month. 31, 2000 to $16.23 at March 31, 2001." Continuing, Richard Wayne Dr. Richard Wayne (April 4, 1804 – June 27, 1858) served as mayor of Savannah, Georgia for four terms: 1844 - 1845, 1848 - 1851, 1852 - 1853 and 1857 - 1858. He died while in office.[1] Wayne was the first mayor of Savannah elected by its citizens. , the Bank's President and Co-Chief Executive Officer, noted that "We took significant steps in the first quarter to take advantage of the relatively low interest rate environment by borrowing $139 million from the Federal Home Loan Bank of Boston Boston, town, England Boston, town (1991 pop. 26,495), E central England, on the Witham River. Boston's fame as a port dates from the 13th cent., when it was a Hanseatic port trading wool and wine. Having recovered from a decline in the 18th and 19th cent. to manage our interest rate risk and diversify diversify To acquire a variety of assets that do not tend to change in value at the same time. To diversify a securities portfolio is to purchase different types of securities in different companies in unrelated industries. our sources of liquidity. These borrowings have terms ranging from one to ten years and will help to match the longer term, fixed-rate aspect of our first quarter loan purchases and will also provide us with relatively low-cost liquidity at a time when a significant portion of our certificates of deposit are due to mature. We anticipate that, in the long term, these actions will help to reduce our overall 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. ." During the first quarter of 2001, the Bank continued to implement its stock repurchase program, whereby the Bank is authorized au·thor·ize tr.v. au·thor·ized, au·thor·iz·ing, au·thor·iz·es 1. To grant authority or power to. 2. To give permission for; sanction: to repurchase re·pur·chase tr.v. re·pur·chased, re·pur·chas·ing, re·pur·chas·es To buy (something) again. n. The act of buying something that one previously sold or owned. Noun 1. up to 1.75 million shares of its common stock in open market or privately negotiated transactions. As of March 31, 2001, the Bank has repurchased 1,661,300 shares at a weighted average per share price of $9.78. For the quarter ended March 31, 2001, Dolphin dolphin, fish dolphin, large, swift game fish, Coryphaena hipparus, also called dorado. It is of nearly worldwide distribution in warm waters. Capital Corp., the Bank's leasing subsidiary, reported net income of $17,000, compared to a net loss of $123,000 for the quarter ended March 31, 2000. The increase was primarily attributable attributable emanating from or pertaining to attribute. attributable proportion see attributable risk (below). attributable risk to a higher net interest margin and new lease servicing activities entered into during the first quarter. Investors and interested parties will have the opportunity to listen to management's discussion of the Bank's quarterly results in a conference call to be held on Friday Friday: see Sabbath; week. Friday young Indian rescued by Crusoe and kept as servant and companion. [Br. Lit.: Robinson Crusoe] See : Servant , April 20th at 11:00 a.m., Eastern time. The conference call will be broadcast over the investor relations Investor relations The process by which the corporation communicates with its investors. page of the Bank's website at www.capitalcrossing.com. For those who cannot listen to the live broadcast, an audio replay of the call will be available on the website for 30 days or for seven days via telephone at (800) 633-8284 or (858) 812-6440, reservation code #18602519. This news release contains 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. regarding future events or financial performance. These statements are only predictions and actual events or results may differ materially. Factors which could cause such differences include material announcements by the Bank or its competitors, the Bank's ability to successfully acquire loans at the same volume and the same yields as it has historically, the Bank's ability to successfully diversify its asset base, the level of the Bank's non-performing assets, changes in interest rates that adversely affect its business, the Bank's ability to successfully conduct its leasing business, as well as those other factors described in the Bank's periodic filings with the Federal Deposit Insurance Corporation Federal Deposit Insurance Corporation (FDIC), an independent U.S. federal executive agency designed to promote public confidence in banks and to provide insurance coverage for bank deposits up to $100,000. , specifically the cautionary statement identifying certain factors that could effect future results included in the Management's Discussion and Analysis Management's discussion and analysis (MD&A) A report from management to shareholders that accompanies the firm's financial statements in the annual report. It explains the period's financial results and enables management to discuss topics that may not be apparent in the financial section of its most recent Annual Report on Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. . Capital Crossing Bank is a Massachusetts-chartered, FDIC-insured trust company with $875 million in assets as of March 31, 2001. Capital Crossing operates as a commercial bank, providing financial products and services to customers through its executive and main offices in Boston, a branch in Chestnut Hill, Massachusetts Located six miles west of downtown Boston, Massachusetts, Chestnut Hill is a wealthy suburban village notable for its stately old houses, scenic landscape, and the historic campus of Boston College. , and its website at www.capitalcrossing.com. Capital Crossing specializes in purchasing loans, primarily secured by commercial and multi-family residential Multi-family residential is a classification of housing where multiple separate housing units are contained within one building. The most common form is an apartment building. Many intentional communities incorporate multi-family residences, such as in cohousing projects. real estate, at a discount to their outstanding principal balances. Capital Crossing has established a relationship banking division that leverages its strong capital base and credit skills to manage the special needs of business customers.
Capital Crossing Bank and Subsidiaries
Consolidated Financial Highlights
(Unaudited)
March 31, December 31,
2001 2000
(dollars in thousands, except per share data)
Total assets $ 874,847 $ 771,484
Loans and leases 666,810 618,973
Non-amortizing discount (28,696) (23,985)
Amortizing discount (36,365) (19,412)
Allowance for loan and lease losses (14,853) (12,818)
Net deferred loan and lease income (9,426) (9,538)
Loans and leases, net 577,470 553,220
Securities available for sale 47,571 57,733
Deposits 638,003 673,891
Borrowed funds 140,960 2,721
REIT preferred stock 12,632 12,636
Stockholders' equity 68,911 68,410
Non-performing assets:
Other real estate owned, net 1,383 1,025
Non-performing loans, net 4,589 1,993
Total non-performing assets, net 5,972 3,018
Accruing loans past due ninety days
or more 745 --
Total non-performing assets, net as
a percent to total assets 0.68% 0.39%
Allowance for loan and lease
losses as a percent of loans and
leases, net of discount and
deferred income 2.51 2.26
Allowance for loan and lease
losses as a percent of
non-performing loans and leases 323.67 643.15
Book value per common share $ 16.23 $ 15.62
Tangible book value per common share 15.15 14.56
Shares outstanding, net 4,245,419 4,380,819
Capital Crossing Bank and Subsidiaries
Consolidated Operating Results and Related Financial Data
(Unaudited)
Three Months Ended
March 31,
2001 2000
(in thousands, except per share data and percentages)
Interest income $ 21,392 $ 18,171
Interest expense (11,530) (8,139)
Net interest income 9,862 10,032
Provision for loan and lease losses (316) (392)
Net interest income, after
provision for loan and
lease losses 9,546 9,640
Gains on sales of loans and leases -- 656
Gains (losses) on sales of
securities, net 98 (4)
Other income 513 319
Operating expenses:
Other real estate owned income, net 18 590
Other operating expenses (6,613) (6,367)
Total operating expenses (6,595) (5,777)
Income before income taxes and
dividends on REIT preferred stock 3,562 4,834
Provision for income taxes (1,281) (1,766)
Dividends on REIT preferred stock (225) (226)
Net income available to common
stockholders $ 2,056 $ 2,842
Weighted average shares outstanding:
Basic 4,313 5,903
Diluted 4,678 6,184
Earnings per share:
Basic $ 0.48 $ 0.48
Diluted 0.44 0.46
Financial ratios (annualized):
Return on average assets 0.97% 1.72%
Return on average stockholders' equity 12.19% 15.74%
Capital Crossing Bank and Subsidiaries
Interest Rate and Loan and Lease Volume Analysis
(Unaudited)
Three Months Ended
March 31,
2001 2000
(dollars in thousands)
Weighted average yield/rate (annualized):
Short-term investments 5.49% 5.47%
Securities available for sale 7.09 6.70
Loan and lease portfolio, net 12.25 13.77
Total interest-earning assets 10.44% 11.65%
Interest bearing-liabilities 6.24% 5.83%
Interest rate spread 4.20% 5.82%
Net interest margin 4.81% 6.43%
Loan and lease volume:
Loan originations $ 4,297 $ 2,960
Loan acquisitions
Loan balances 84,872 119,615
Discount (27,471) (4,845)
Loan acquisitions, net 57,401 114,770
Lease volume 6,373 8,254
Total loan and lease volume, net $ 68,071 $ 125,984
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