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POUGHKEEPSIE SAVINGS BANK REPORTS 1991 RESULTS; FILES CAPITAL PLAN WITH REGULATORS

 POUGHKEEPSIE SAVINGS BANK REPORTS 1991 RESULTS;
 FILES CAPITAL PLAN WITH REGULATORS
 POUGHKEEPSIE, N.Y., Jan. 29 /PRNewswire/ -- Poughkeepsie Savings Bank, FSB (NASDAQ: PKPS) today reported a net loss of $7.2 million, or $1.99 per share, for the fourth quarter of 1991 and a net loss of $18.1 million, or $5.04 per share, for the year ended Dec. 31, 1991. The net losses reported for the comparable periods of 1990 were $10.2 million, or $2.87 per share, and $41.2 million, or $11.57 per share, respectively. The net losses in 1990 reflected income tax benefits of $1.8 million and $8.7 million in the fourth quarter and full year of 1990, respectively. Income tax benefits were not available for recognition in 1991.
 Commenting on the results for 1991, Christoph H. Schmidt, chairman and chief executive officer, said, "The losses for 1991 reflect the punishing cost of holding a large portfolio of real estate assets during a severe downturn in the economy and, more particularly, in the real estate markets. They also reflect costs related to the implementation of significant expense control initiatives, including outsourcing of back office functions and staff reductions, which are well under way. These efforts and hoped-for improvement of the general business climate should facilitate the bank's recovery."
 In response to the previously announced capital directive dated Dec. 6, 1991, Poughkeepsie filed its capital plan on Jan. 24, 1992, with its primary regulator, the Office of Thrift Supervision ("OTS"). The capital plan, which must be reviewed and accepted by the OTS, details the bank's plans to return to capital compliance. These plans are based on gradual reductions of non-performing assets, substantial reductions in operating expenses and a major contraction of the balance sheet as part of an overall strategy to focus on its core Mid-Hudson franchise. As is the case for any institution with a capital deficiency, rejection of the plan by the OTS could lead to a variety of enforcement actions.
 Non-performing assets, net of reserves, at Dec. 31, 1991, which includes loans delinquent 90 days or more, non-accrual loans, loans in foreclosure, other real estate owned and investment in joint ventures, totaled $85.3 million, or 7.46 percent of total assets. The year-end 1990 amount of non-performing assets was $72.0 million, or 5.28 percent of total assets. The increase over 1990 levels is generally attributable to the continued depressed state of the economy and real estate markets. The bank has been aggressively seeking title to the collateral for non-performing loans to facilitate the sale or improve the management of the property. This is reflected in an increase in other real estate owned over the last year. Delinquent loans are now at lower levels than in December 1990.
 The provisions for loan losses for the fourth quarter and full year 1991 were $1.9 million and $7.0 million, respectively, compared with $2.1 million and $26.7 million for the same periods in 1990. In addition, expenses related to the operation of other real estate (ORE) owned as well as charges recorded to reflect reduced realizable values of such assets aggregated $4.6 million and $9.1 million in the fourth quarter and full year, respectively, of 1991. These amounts had a significant effect on 1991 results but were at lower levels than those recorded in the comparable 1990 periods.
 Operating expenses, excluding the costs related to ORE mentioned above, were $9.6 million and $37.4 million in the fourth quarter and full year 1991, respectively. These amounts are significantly below the prior year's levels, even though they include expense provisions of $.8 million in the fourth quarter and $2.3 million for the year 1991 related to the bank's aggressive cost reduction program and its decision to outsource a significant part of its back office operations. Poughkeepsie expects to complete these restructuring programs by mid- 1992.
 Total assets were $1.1 billion at Dec. 31, 1991, compared with $1.4 billion at Dec. 31, 1990, which decrease primarily reflects managed reductions in loans and mortgage-backed securities. These reductions were matched largely by reductions in borrowed funds. Deposits were down from year-end 1990 primarily due to the sale earlier in 1991 of a banking division in North Carolina and the reduction in brokered certificates of deposit.
 At Dec. 31, 1991, shareholders' equity was $27.6 million and book value per share was $7.60. The bank's tangible capital, core capital and risk-weighted capital ratios were 2.41 percent, 2.41 percent and 4.95 percent, respectively. These ratios compare with the current requirements for the bank of 1.5 percent, 4.0 percent and 7.2 percent, respectively. The 4.0 percent core capital requirement is provided for in the capital directive received in December 1991.
 Poughkeepsie Savings Bank is a community banking institution whose principal market is the Mid-Hudson Valley region of New York, where it operates eight branches. Market Street Mortgage Corporation, its Tampa- based mortgage


banking subsidiary, has loan production offices in Florida, North Carolina, Georgia, Virginia and Maryland. The bank's deposits are insured by the Federal Deposit Insurance Corporation.
 POUGHKEEPSIE SAVINGS BANK, FSB
 Consolidated Condensed Financial Data
 (In thousands, except per share)
 Periods ended Three Months Twelve Months
 Dec. 31 1991 1990 1991 1990
 (Unaudited)
 Net interest income $ 4,105 $ 4,941 $ 19,857 $ 24,578
 Provision for loan losses 1,850 2,145 7,008 26,725
 Net interest income (loss)
 after provision for loan
 losses 2,255 2,796 12,849 (2,147)
 Other income 4,709 2,099 15,456 6,641
 Other expenses 14,149 16,884 46,453 54,436
 Loss before taxes (7,185) (11,989) (18,148) (49,942)
 Income tax benefit -- (1,758) -- (8,740)
 Net loss $(7,185) $(10,231) $(18,148) $(41,202)
 Loss per share $(1.99) $(2.87) $(5.04) $(11.57)
 Net interest spread 1.83 1.65 1.89 1.67
 Net interest margin 1.52 1.54 1.70 1.77
 Return on average
 assets (pct) (2.43) (2.96) (1.43) (2.84)
 Return on average
 equity (pct) (90.75) (79.14) (27.60) (60.28)
 Selected Asset and Liability Data
 12/31/91 12/31/90
 Total assets $1,143,369 $1,364,668
 Net loans 936,164 1,146,958
 Allowance for loan losses 22,377 21,535
 Deposits 661,692 706,479
 Shareholders' equity 27,608 45,727
 Book value per share $7.60 $12.84
 Earning assets to costing
 liabilities (pct) 96.38 99.62
 -0- 1/29/92
 /CONTACT: Christoph H. Schmidt (media), chairman and CEO, 914-431-6211; or Kevin Timmons (analysts), senior vice president and treasurer, 914-431-6291, both of Poughkeepsie Savings Bank/
 (PKPS) CO: Poughkeepsie Savings Bank, FSB ST: New York IN: FIN SU: ERN


GK-HM -- NY062 -- 4838 01/29/92 15:15 EST
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Date:Jan 29, 1992
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