Coast announces first-quarter earnings, an increase in net interest margin and a further reduction in nonperforming assets.LOS LOS Length of stay, see there ANGELES--(BUSINESS WIRE)--April 25, 1995--Coast Savings Financial Inc. (NYSE/PSE:CSA (1) (Canadian Standards Association, Toronto, Ontario, www.csa.ca) A standards-defining organization founded in 1919. It is involved in many industries, including electronics, communications and information technology. ), the holding company of Coast Federal Bank, FSB (FrontSide Bus) See system bus. FSB - front side bus , Tuesday Tuesday: see week. reported net earnings of $3.5 million, or 18 cents per fully 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 quarter ended March 31, 1995, compared with a net loss of $6.7 million, or 36 cents per fully diluted share, for the first quarter of 1994. The net loss for the year-earlier quarter reflects a $15 million pre-tax pre-tax adj → anterior al impuesto pre-tax adj → avant impôt(s) pre-tax adj → al lordo d'imposta charge (or 46 cents per fully diluted share) attributable attributable emanating from or pertaining to attribute. attributable proportion see attributable risk (below). attributable risk to the Northridge earthquake The Northridge earthquake occurred on January 17, 1994 at 4:31 AM Pacific Standard Time in the city of Los Angeles, California. The earthquake had a "strong" moment magnitude of 6. . ``We are pleased with the company's progress during the latest quarter,'' stated Ray Martin, chairman and chief executive officer. ``The continued modest recovery in the 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). economy, coupled with the previously announced elimination of approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. $1.0 billion of multifamily exposure in the fourth quarter of 1994, led to the lowest quarterly credit costs in six years. ``These influences and the company's ongoing emphasis on aggressively liquidating foreclosed 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 also resulted in a further reduction in 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. during the quarter. In addition, Coast's net interest margin improved in spite of in opposition to all efforts of; in defiance or contempt of; notwithstanding. See also: Spite the reset lag inherent in the Eleventh In music or music theory an eleventh is the note eleven scale degrees from the root of a chord and also the interval between the root and the eleventh. Since there are only seven degrees in a diatonic scale the eleventh degree is the same as the subdominant and the interval District cost of funds index A Cost of Funds Index or COFI is a regional average of interest expenses incurred by financial institutions, which in turn is used as a base for calculating variable rate loans. . ``Predicated on relatively stable market interest rates and a corresponding moderation of the reset lag, the net interest margin should further expand during the course of 1995.'' Nonperforming assets (defined as the sum of nonaccrual loans, foreclosed real estate owned and modified mod·i·fy v. mod·i·fied, mod·i·fy·ing, mod·i·fies v.tr. 1. To change in form or character; alter. 2. loans) were $134.2 million at March 31, 1995, or 1.57 percent of assets (the lowest level since 1986), compared with $141.9 million, or 1.73 percent of assets and $229.0 million, or 2.86 percent of assets at Dec. 31, 1994, and March 31, 1994, respectively. As of March 31, 1994, Coast's risk-based, leverage and tangible capital ratios were 9.87 percent, 4.82 percent and 4.82 percent, respectively, each of which exceeded the fully phased-in requirements specified in the Office of Thrift thrift: see leadwort. Supervision's capital regulations. 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. for the first quarter of 1995 totaled $413.0 million, virtually all of which were one-to-four family adjustable rate mortgages 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. . At March 31, 1995, Coast had 96 percent of its portfolio in adjustable rate Adjustable rate Applies mainly to convertible securities. Refers to interest rate or dividend that is adjusted periodically, usually according to a standard market rate outside the control of the bank or savings institution, such as that prevailing on Treasury bonds or notes. loans, and its one-year adj. 1. completing its life cycle within a year. Adj. 1. one-year - completing its life cycle within a year; "a border of annual flowering plants" annual phytology, botany - the branch of biology that studies plants gap ratio -- a measure of interest rate exposure -- was a positive 3 percent. Reflecting the recent stabilization Stabilization The action undertakes a country when it buys and sells its own currency to protect its exchange value. Actions registered competitive traders undertake by on the NYSE to meet the exchange requirement that 75% of their traded be stabilizing, meaning that sell orders of market interest rates, the increased amount of transaction accounts and disciplined liability pricing, Coast's net interest rate spread -- the difference between the yield on interest-earning assets and the cost of interest-bearing Adj. 1. interest-bearing - of financial obligations on which interest is paid liabilities -- increased to 2.20 percent at March 31, 1995, compared with 2.19 percent at Dec. 31, 1994. Net interest income totaled $47.4 million for the latest quarter, compared with the $44.8 million recorded for the quarter ended Dec. 31, 1994. General and administrative expenses were $41.9 million for the three months ended March 31, 1995, compared with $39.8 million for the three-month period ended Dec. 31, 1994. The combined total of loan servicing Loan servicing is the process by which a mortgage bank or subservicing firm collects the timely payment of interest and principal from borrowers. The level of service varies depending on the type loan and the terms negotiated between the firm and the investor seeking their services. fees and charges, retail banking fees and the recurring re·cur intr.v. re·curred, re·cur·ring, re·curs 1. To happen, come up, or show up again or repeatedly. 2. To return to one's attention or memory. 3. To return in thought or discourse. portion of other income from operations increased to $11.7 million for the three months ended March 31, 1995, compared with $11.5 million for the previous quarter. As a result of the items detailed above, Coast's pre-tax core profitability (defined as net interest income before provision for loan losses less general and administrative expenses plus loan servicing fees and charges and the recurring portion of other income) increased to $17.2 million for the latest quarter from the $16.6 million registered for the three-month period ended Dec. 31, 1994. 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. increased to $381.0 million, or $20.64 per share at March 31, 1995, compared with $375.2 million, or $20.33 per share at Dec. 31, 1994. Tangible stockholders' equity increased to $369.8 million, or $20.03 per share at the end of the latest quarter, compared with $363.7 million, or $19.71 per share at Dec. 31, 1994. Coast Savings Financial is the holding company of Coast Federal Bank. With assets of $8.5 billion, Coast is one of the nation's largest thrift institutions Thrift institution An organization formed as a depository for primarily consumer savings. Savings and loan associations and savings banks are thrift institutions. . Coast's primary emphasis is on residential real estate lending and retail banking provided through 92 retail banking offices located throughout California. -0-
Coast Savings Financial Inc. and Subsidiaries
Consolidated Financial Highlights
(Dollars in thousands)
(Unaudited)
March 31, Dec. 31,
1995 1994
Financial Condition
Assets
Cash and due from banks $ 118,286 $ 99,578
Investment securities 184,572 84,920
Loans receivable 6,025,401 5,793,182
Mortgage-backed securities 1,742,121 1,733,728
Real estate held for sale 50,674 44,168
Federal Home Loan Bank stock 82,829 79,261
Land and depreciable assets 87,208 87,493
Interest receivable and other assets 237,798 262,683
Goodwill 11,188 11,504
$ 8,540,077 $ 8,196,517
Liabilities and Stockholders' Equity
Liabilities:
Deposits $ 6,014,608 $ 5,879,808
Federal Home Loan Bank advances 1,062,450 954,450
Other borrowings 975,123 865,111
Income taxes 8,084 8,588
Other liabilities 98,831 113,346
8,159,096 7,821,303
Stockholders' equity:
Common stock 185 185
Additional paid-in capital 263,161 263,161
Unrealized gain (loss) on available-
for-sale securities 1,283 (1,006)
Retained earnings 116,352 112,874
380,981 375,214
$ 8,540,077 $ 8,196,517
Regulatory Capital Ratios (in percent) Risk-based 9.87 pct. 10.50 pct. Core 4.82 pct. 5.39 pct. Tangible 4.82 pct. 5.01 pct. Weighted Average Interest Rates (in percent) Loans receivable and mortgage-backed securities 7.26 pct. 6.84 pct. Investment securities 5.69 pct. 5.90 pct. Interest-earning assets 7.21 pct. 6.82 pct. Deposits 4.54 pct. 4.15 pct. Borrowings 6.66 pct. 6.47 pct. Interest-bearing liabilities 5.01 pct. 4.63 pct. Net spread 2.20 pct. 2.19 pct. One-Year Gap (the cumulative difference between repricing assets and liabilities) to total assets 3 pct. 6 pct.
Coast Savings Financial Inc. and Subsidiaries
Consolidated Financial Highlights
(Dollars in thousands except per-share amounts)
(Unaudited)
Three Months Ended
March 31,
1995 1994
Operations
Interest income:
Loans and mortgage-backed securities $ 139,116 $ 113,833
Investment securities 5,918 3,881
145,034 117,714
Interest expense:
Deposits 64,039 51,783
Borrowings 33,585 16,902
97,624 68,685
Net interest income 47,410 49,029
Provision for loan losses 10,000 32,000
Net interest income after provision
for loan losses 37,410 17,029
Non-interest income:
Loan servicing fees and charges 3,430 4,540
Gain (loss) on sale of assets (120) 409
Other 8,282 9,396
11,592 14,345
Non-interest expense:
General and administrative expenses 41,912 40,198
Real estate operations, net 977 2,613
Amortization of goodwill 316 354
43,205 43,165
Earnings (loss) before income tax (expense) benefit 5,797 (11,791) Income tax (expense) benefit (2,319) 5,072 Net earnings (loss) $ 3,478 $ (6,719) Fully diluted earnings (loss) per share of common stock 18 cents (36 cents) Shares of common stock outstanding at end of period 18,457,454 18,456,454
Coast Federal Bank, FSB
Nonperforming Assets
(Dollars in thousands)
Mar 31, Jun 30, Sep 30,
1993 1993 1993
Nonaccrual loans $ 139,096 $ 129,590 $ 124,641 Foreclosed real estate owned 167,656 122,513 111,038 Modified loans/a 1,350 1,350 2,371 Nonperforming assets $ 308,102 $ 253,453 $ 238,050 General valuation allowance (GVA) $ 135,000 $ 125,000 $ 125,000 Total assets $8,238,167 $8,326,125 $8,141,162 Ratio of nonperforming assets to total assets 3.74 pct. 3.04 pct. 2.92 pct. Ratio of GVA to nonperforming assets 44 pct. 49 pct. 53 pct.
Dec 31, Mar 31, Jun 30, Sep 30,
1993 1994 1994 1994
Nonaccrual loans $ 117,122 $ 133,490 $ 137,439 $ 133,724 Foreclosed real estate owned 100,721 94,493 76,972 74,219 Modified loans/a 2,370 1,020 1,020 1,020 Nonperforming assets $ 220,213 $ 229,003 $ 215,431 $ 208,963 General valuation allowance (GVA) $ 120,000 $ 130,000 $ 114,000 $ 111,000 Total assets $8,094,817 $8,004,331 $8,029,980 $8,127,985 Ratio of nonperforming assets to total assets 2.72 pct. 2.86 pct. 2.68 pct. 2.57 pct. Ratio of GVA to nonperforming assets 54 pct. 57 pct. 53 pct. 53 pct.
Dec 31, Mar 31,
1994 1995
Nonaccrual loans $ 96,713 $ 82,569 Foreclosed real estate owned 44,168 50,674 Modified loans/a 1,020 1,020 Nonperforming assets $ 141,901 $ 134,263 General valuation allowance (GVA) $ 85,000 $ 85,000 Total assets $8,196,517 $8,540,077 Ratio of nonperforming assets to total assets 1.73 pct. 1.57 pct. Ratio of GVA to nonperforming assets 60 pct. 63 pct.
(a) Defined as loans whose terms have been modified such that the
interest rates charged to the borrowers have been reduced to
levels below the original contract rates and below market rates
of interest at both the time of modification and the reporting
date.
CONTACT: Coast Savings Financial Inc., 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. Mark Neal/Priscilla Finch finch, common name for members of the Fringillidae, the largest family of birds (including over half the known species), found in most parts of the world except Australia. , 213/362-2134 |
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