Capital Crossing Bank Announces Quarterly Results.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. -- 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") reported consolidated con·sol·i·date v. con·sol·i·dat·ed, con·sol·i·dat·ing, con·sol·i·dates v.tr. 1. To unite into one system or whole; combine: net income of $3.0 million, or $0.46 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, for the first quarter of 2006, compared to consolidated net income of $4.7 million, or $0.65 per diluted share, for the same period in 2005. 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, stated, "We are pleased to report another solid quarter at Capital Crossing Bank." Mr. Lazares further stated, "A significant portion of the Bank's earnings arises from the recognition of "transactional" income. In the first quarter of 2006, the Bank recognized $7.8 million of transactional income, including $5.3 million of accelerated interest income associated with loan and lease payoffs, $1.3 million on gain on sales of loans and $1.2 million in net gain on sales 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 and property in possession. By contrast, in the first quarter of 2005, the Bank recognized $9.8 million of transactional income, including $6.3 million of accelerated interest income associated with loan and lease payoffs and $3.5 million in net gain on sales of other real estate owned and property in possession. Since the level of transactional income, including loan and lease payoffs, is unpredictable from quarter to quarter, the Bank's earnings may fluctuate significantly in the future." 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, explained that, "The volume of our loan acquisitions can also be unpredictable from quarter-to-quarter. For example, in the first quarter of 2006, we purchased loans with outstanding principal balances of $34.8 million for a purchase price of $29.4 million, compared to the same period in 2005, when we purchased loans with outstanding principal balances of $50.9 million for a purchase price of $44.4 million." Mr. Wayne Wayne, city (1990 pop. 19,899), Wayne co., SE Mich., a suburb of Detroit, on the Lower Rouge River; inc. as a village 1869, and with surrounding areas as a city 1960. It has automobile and aircraft industries and other varied manufactures. continued, "During the course of our review of available loan portfolios, we will, in some cases, decline to bid on a portfolio after analyzing the results of our due diligence Research; analysis; your homework. This term has caught on in all industries, because it sounds so "wired." Who would want to do analysis or research when they can do due diligence. See wired. review, or, in other instances, be outbid out·bid tr.v. out·bid, out·bid·den or out·bid, out·bid·ding, out·bids To bid higher than: We outbid our rivals at the auction. by other purchasers. We simply cannot predict how often we will successfully acquire a loan portfolio." Mr. Wayne further stated, "Our total non-performing assets increased $4.3 million from $42.5 million at December December: see month. 31, 2005 to $46.7 million at March 31, 2006. While a substantial majority of the loan and leases we have acquired in recent years have been performing, we have also acquired appropriately priced 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. At March 31, 2006, we held loans and leases with net investment balances of $11.8 million which were acquired as non-performing, compared to $14.1 million at December 31, 2005. Additionally, the balance of other real estate owned increased from $14.0 million at December 31, 2005 to $17.3 million at March 31, 2006. The primary source of other real estate owned is purchased loans that are or become non-performing. In the past, our pricing strategy and the level of discount we obtain on such loans and leases has enabled us to, over time, realize significant levels of transactional income from these assets." During the first quarter of 2006, the Bank's leasing subsidiary, Dolphin dolphin, fish dolphin, large, swift game fish, Coryphaena hipparus, also called dorado. It is of nearly worldwide distribution in warm waters. Capital Corp., originated leases with an aggregate investment balance of $19.2 million, compared to the same period in 2005 when it originated leases with an aggregate investment balance of $14.5 million. Dolphin Capital Corp.'s net income was $409,000 for the quarter ended March 31, 2006 compared to $870,000 for the same period in 2005. Since December 31, 2005, the Bank's book value per share has increased $0.32 from $14.52 to $14.84 at March 31, 2006. Additionally, the return on stockholders' equity Stockholders' Equity The portion of the balance sheet that includes capital received from investors in exchange for stock (paid-in capital), donated capital, and retained earnings. This is equal to total assets minus liabilities, preferred stock and intangible assets. was 15.46% for the first quarter of 2006 compared to 21.01% for the same period in 2005. The Bank continued 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. shares of its common stock under its common stock repurchase Stock repurchase A firm's repurchase of outstanding shares of its common stock. program during the first quarter of 2006. As of March 31, 2006, the Bank had repurchased 7,020,678 shares under its current repurchase program and previous repurchase programs at an average purchase price of $13.11 per share, and had an additional $5.0 million to invest under its current repurchase program. The Bank initiated its first repurchase program in August 2000. 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 Thursday Thursday: see week. , April 20th at 10:00 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 or via telephone at 888-203-1112, access code #8633294. A replay of the call will be available beginning at approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. 1:00 P.M. on April 20, 2006 through midnight on April 25, 2006. This press release contains a number of 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. concerning the Bank's current expectations as to future growth and its results of operations. Any statements that are not statements of historical fact (including statements containing the words "believes," "plans," "anticipates," "expects," "estimates," "intends," "may," "projects," "will," "would," and similar expressions) should also be considered to be forward-looking statements. There are a number of important factors that could cause actual results or events to differ materially from those indicated by such forward-looking statements, including: the Bank's ability to successfully acquire loans at the same volume and the same yields as it has historically, changes in interest rates that adversely affect its business, the level of transactional income realized by the Bank as a result of loan payoffs and the sale of real estate and loans, the Bank's ability to successfully 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. its asset base, the level of the Bank's non-performing assets, the Bank's ability to successfully conduct its leasing business, general economic conditions in the Bank's markets, as well as those other factors detailed under Item 1A "Risk Factors" in the Bank's 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. for the year ended December 31, 2005, which important factors are incorporated herein by this reference. The Bank disclaims any intention or obligation to update any forward-looking statements as a result of developments occurring after the date of this press release. Capital Crossing Bank is a Massachusetts-chartered, FDIC-insured trust company with $1.0 billion in assets as of March 31, 2006. The Bank operates as a commercial bank, providing financial products and services to customers through its executive and main offices in Boston, its website at www.capitalcrossing.com, and through its leasing subsidiary Dolphin Capital Corp. located in Moberly, Missouri Moberly is a city in Randolph County, Missouri, United States. The population was 11,945 at the 2000 census. The city was incorporated 1868. The Moberly Micropolitan Statistical Area consists of Randolph County. . The Bank is a value oriented o·ri·ent n. 1. Orient The countries of Asia, especially of eastern Asia. 2. a. The luster characteristic of a pearl of high quality. b. A pearl having exceptional luster. 3. investor in whole loans and loan portfolios generally secured by commercial, multi-family and one-to-four family residential real estate and other business assets.
Capital Crossing Bank and Subsidiaries
Consolidated Financial Highlights
(Unaudited)
March 31, December 31,
2006 2005
------------- -----------
(dollars in thousands,
except per share data)
Total assets $1,026,047 $1,106,158
Loans and leases: 990,673 1,004,120
Non-accretable discount (51,789) (53,407)
Accretable discount (84,257) (84,894)
Allowance for loan and lease losses (14,558) (15,585)
Net deferred loan and lease income (19,533) (18,396)
----------- -----------
Loans and leases, net 820,536 831,838
----------- -----------
Short-term investments 30,884 120,807
Securities available for sale 97,914 84,645
Deposits 670,994 723,388
Borrowed funds 198,070 218,849
REIT preferred stock 64,758 64,758
Stockholders' equity 77,212 76,499
Non-performing assets:
Other real estate owned, net 17,324 14,003
Other assets in possession 407 506
Non-performing loans and leases, net:
Loans and leases acquired as non-
performing 11,811 14,078
Loans and leases that became non-
performing subsequent to
acquisition 17,197 13,880
----------- -----------
Total non-performing assets, net 46,739 42,467
----------- -----------
Total non-performing assets, net as a
percent to total assets 4.56 % 3.84 %
Allowance for loan and lease losses as a
percent of loans and leases, net of
discount and deferred income 1.74 1.84
Allowance for loan and lease losses as a
percent of net non-performing
loans and leases 50.19 55.74
Book value per common share $14.84 $14.52
Tangible book value per common share 14.00 13.69
Shares outstanding, net 5,203,189 5,269,184
Capital Crossing Bank and Subsidiaries
Consolidated Operating Results and Related Financial Data
(Unaudited)
Three Months
Ended
March 31,
-----------------
2006 2005
-------- --------
(in thousands,
except per share
data)
Interest income - regularly scheduled $19,045 $18,059
Interest income - transactional 5,317 6,314
-------- --------
Total interest income 24,362 24,373
Interest expense (9,753) (8,200)
-------- --------
Net interest income 14,609 16,173
Credit for loan and lease losses, net 549 1,040
-------- --------
Net interest income, after credit for loan and lease
losses 15,158 17,213
Gain on sales of loans, net 1,329 -
Other income 460 402
Operating expenses:
Other real estate owned and assets in possession
income, net 802 3,414
Other operating expenses (10,621) (11,023)
-------- --------
Total operating expenses (9,819) (7,609)
-------- --------
Income before income taxes, minority interest and
dividends on REIT preferred stock 7,128 10,006
Provision for income taxes (3,185) (4,391)
Minority interest, net of taxes (55) (32)
Dividends on REIT preferred stock, net of taxes (927) (927)
-------- --------
Net income $2,961 $4,656
======== ========
Weighted average shares outstanding:
Basic 5,255 6,025
Diluted 6,399 7,207
Earnings per share:
Basic $0.56 $0.77
Diluted 0.46 0.65
Financial ratios (annualized):
Return on average assets 1.17% 1.81%
Return on average stockholders' equity 15.46% 21.01%
Transactional income:
Interest and fee income on loan and
lease pay-offs
Non-accretable discount $684 $3,617
Accretable discount 2,926 2,204
Other interest income 1,707 493
-------- --------
Total interest and fee income on loan
and lease pay-offs 5,317 6,314
Gain on sale of loans, net 1,329 -
Gain on sale of other real estate owned and
assets in possession, net 1,202 3,473
-------- --------
Total transactional income $7,848 $9,787
======== ========
Capital Crossing Bank and Subsidiaries
Interest Rate and Loan and Lease Volume Analysis
(Unaudited)
Three Months Ended
March 31,
-------------------
2006 2005
--------- --------
(dollars in
thousands)
Weighted average yield/rate (annualized):
Short-term investments 4.40 % 2.42 %
Securities available for sale 4.71 4.68
Loan and lease portfolio, net 11.48 11.28
Total interest-earning assets 10.36 % 10.09 %
Interest bearing liabilities 4.62 % 3.85 %
Interest rate spread 5.74 % 6.24 %
Net interest margin 6.21 % 6.69 %
Loan and lease volume:
Loan originations $2,175 $508
Loan acquisitions
Loan balances 34,796 50,908
(Discount) premium, net (5,430) (6,485)
-------- --------
Loan acquisitions, net 29,366 44,423
-------- --------
Total loan volume 31,541 44,931
-------- --------
Lease originations 19,156 14,526
Lease acquisitions, net - -
-------- --------
Total lease volume 19,156 14,526
-------- --------
Total loan and lease volume, net $50,697 $59,457
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