Provident Financial Services, Inc. Announces Quarterly Earnings, Declares Quarterly Dividend and Announces Expanded Stock Repurchase Program.JERSEY CITY, N.J. -- Provident Financial Provident Financial plc is a financial services group based in Bradford, England. It specialises in home credit, but also owns Vanquis Bank which offers credit cards. Domestic Operations Services, Inc. (NYSE NYSE See: New York Stock Exchange :PFS PFS, n post facilitation stretch; therapeutic approach utilized during proprioceptive neuromuscular facilitation in which the patient begins the stretch midway between the fully relaxed and fully stretched position and uses maximum level of effort to ) (the "Company") reported net income of $8.6 million for the three months ended June June: see month. 30, 2004 and $18.9 million for the six months ended June 30, 2004 as compared to $8.8 million and $2.4 million, respectively, for the same periods in 2003. Net income for the six months ended June 30, 2003 reflected the one-time one-time adj. 1. or one·time a. Occurring or undertaken only once: a one-time winner in 1995. b. $15.6 million net of tax contribution to The Provident prov·i·dent adj. 1. Providing for future needs or events. 2. Frugal; economical. [Middle English, from Latin pr Bank Foundation. Basic and diluted earnings per share diluted earnings per share An earnings measure calculated by dividing net income less preferred stock dividends for a period by the average number of shares of common stock that would be outstanding if all convertible securities were converted into shares of were $0.16 for the quarter and $0.34 for the six months ended June 30, 2004 as compared to basic earnings per share of $0.15 and $0.02, respectively, for second quarter 2003 and for the period from January January: see month. 15, 2003, the date of the Company's stock conversion, through June 30, 2003. The Company completed the acquisition of First Sentinel Bancorp, Inc. as of the close of business July July: see month. 14, 2004. Pursuant to the terms of the Agreement and Plan of Merger, 60% of First Sentinel common stock was converted into Provident common stock at an exchange rate of 1.092 Provident shares per each First Sentinel share and 40% was converted into $22.25 in cash for each First Sentinel share. The aggregate consideration paid in the merger consisted of $251.9 million in cash and 18,540,662 shares of the Company's common stock. DECLARATION OF QUARTERLY DIVIDEND On July 22, 2004, the Company's Board of Directors declared de·clare v. de·clared, de·clar·ing, de·clares v.tr. 1. To make known formally or officially. See Synonyms at announce. 2. To state emphatically or authoritatively; affirm. 3. a quarterly cash dividend of $0.06 per common share, consistent with the prior quarterly dividend. The dividend is payable on August 31, 2004 to stockholders of record as of the close of business on August 13, 2004. AUTHORIZATION The right or permission to use a system resource; the process of granting access. See access control. OF EXPANDED STOCK REPURCHASE Stock repurchase A firm's repurchase of outstanding shares of its common stock. PROGRAM On July 22, 2004, the Company's Board of Directors 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: the expansion of the Company's stock repurchase program through the purchase of up to an additional 927,033 shares for a total stock repurchase program of 3,966,663 shares, or approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. 5%, of the Company's outstanding shares of common stock. This additional authorization is in recognition of the issuance of 18,540,662 shares in conjunction conjunction, in astronomy conjunction, in astronomy, alignment of two celestial bodies as seen from the earth. Conjunction of the moon and the planets is often determined by reference to the sun. with the acquisition of First Sentinel Bancorp. Repurchases will be made from time to time and will be effectuated through open market purchases, unsolicited un·so·lic·it·ed adj. Not looked for or requested; unsought: an unsolicited manuscript; unsolicited opinions. unsolicited Adjective negotiated transactions, or in such other manner deemed appropriate by management. Completion of the expanded 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. program will not be limited to a specific time period. The Company's repurchase activities will take into account SEC safe harbor rules safe harbor rule Antitrust law A federal guideline as to what constitutes antitrust activity, established by the FTC and Justice Dept, after specific legislation–which might be open to misinterpretation–is enacted. Cf Self-referral. and guidance for issuer repurchases. The Company repurchased 85,000 shares of its common stock for the quarter ended June 30, 2004. Share repurchases Share Repurchase A program by which a company buys back its own shares from the marketplace, reducing the number of outstanding shares. This is usually an indication that the company's management thinks the shares are undervalued. were generally limited due to restrictions imposed on publicly traded companies publicly traded company A company whose shares of common stock are held by the public and are available for purchase by investors. The shares of publicly traded firms are bought and sold on the organized exchanges or in the over-the-counter market. during pending mergers. "During the second quarter we pursued our key strategic initiatives of growing the loan portfolio with emphasis on commercial originations, maximizing max·i·mize tr.v. max·i·mized, max·i·miz·ing, max·i·miz·es 1. To increase or make as great as possible: core deposits and maintaining strong asset quality. On each front we made significant progress," said Paul Paul, 1901–64, king of the Hellenes (1947–64), brother and successor of George II. He married (1938) Princess Frederika of Brunswick. During Paul's reign Greece followed a pro-Western policy, and the Cyprus question was temporarily resolved. M. Pantozzi, Provident's Chairman and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. . "We also continued to increase 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. fee income while keeping total non-interest expense below the level of the previous quarter. Second quarter net earnings were impacted by margin compression compression, external stress applied to an object or substance, tending to cause a decrease in volume (see pressure). Gases can be compressed easily, solids and liquids to a very small degree if at all. due, in part, to the greater liquidity needed to pay the cash portion of our First Sentinel acquisition, which was completed on July 14. Our efforts remain focused on successful integration of operations, deepening deep·en tr. & intr.v. deep·ened, deep·en·ing, deep·ens To make or become deep or deeper. Noun 1. deepening - a process of becoming deeper and more profound of customer relationships and the attainment of earnings accretion The act of adding portions of soil to the soil already in possession of the owner by gradual deposition through the operation of natural causes. The growth of the value of a particular item given to a person as a specific bequest under the provisions of a will between the ." Pantozzi added, "I'm I'm Contraction of I am. Our Living Language Speakers of some scattered varieties of American English sometimes use I'm instead of I've or I have in present perfect constructions, as in pleased that the Board has approved an expanded stock repurchase program. This key aspect of our capital management plan can be pursued in earnest ear·nest 1 adj. 1. Marked by or showing deep sincerity or seriousness: an earnest gesture of goodwill. 2. Of an important or weighty nature; grave. See Synonyms at serious. now that our merger transaction is complete." Balance Sheet Summary Total assets were $4.296 billion at June 30, 2004 as compared to $4.285 billion at December December: see month. 31, 2003. As of June 30, 2004, net loans increased $144.0 million or 6.50% to $2.36 billion, total investments decreased $172.2 million or 10.31% to $1.50 billion, and cash and cash equivalents increased $32.2 million or 18.31% to $208.0 million compared to their respective balances at December 31, 2003. Loan growth highlights for the six month period ended June 30, 2004 included a $77.5 million or 30.91% increase in commercial and industrial loans, a $49.1 million or 16.40% increase in consumer loans, and a $16.0 million or 2.50% increase in commercial real estate loans. The increase in consumer loans is largely attributable attributable emanating from or pertaining to attribute. attributable proportion see attributable risk (below). attributable risk to an increase in indirect auto loans as well as home equity and home equity lines of credit. Core deposits increased $50.1 million or 2.84% to $1.81 billion at June 30, 2004 as compared to $1.76 billion at December 31, 2003. This contributed to growth in total deposits of $47.9 million or 1.78% for the six months ended June 30, 2004. Core deposits as a percentage of total deposits increased to 66.07% at June 30, 2004 as compared to 65.39% at December 31, 2003. The Company's continued emphasis on core account generation has contributed to a 36 basis point reduction in the cost of deposits to 1.35% for second quarter 2004 compared to 1.71% for second quarter 2003. Compared to the trailing quarter, the cost of deposits was unchanged. Total borrowed funds decreased $42.1 million or 5.71% to $694.3 million at June 30, 2004 compared to $736.3 million at December 31, 2003. Wholesale borrowings decreased $53.5 million or 7.74% to $638.2 million at June 30, 2004 compared to $691.7 million at December 31, 2003. Retail repurchase agreements Repurchase agreement An agreement with a commitment by the seller (dealer) to buy a security back from the purchaser (customer) at a specified price at a designated future date. increased $11.4 million to $56.1 million at June 30, 2004 compared to $44.7 million at December 31, 2003. Results of Operations Net Interest Margin Net interest income decreased $485 thousand or 1.47% to $32.5 million for the three months ended June 30, 2004 compared to $32.98 million for the three months ended June 30, 2003. Total interest income decreased $1.7 million or 3.67% to $45.3 million for the three months ended June 30, 2004 compared to $47.0 million for the comparable quarter in 2003. Interest income on loans increased $1.1 million or 3.66% to $32.0 million for the three months ended June 30, 2004 compared to $30.9 million for the three months ended June 30, 2003. In preparation for payment of the cash portion of the merger consideration for First Sentinel Bancorp, Inc., investments were shifted to U.S. Treasury U.S. Treasury Created in 1798, the United States Department of the Treasury is the government (Cabinet) department responsible for issuing all Treasury bonds, notes and bills. Some of the government branches operating under the U.S. Treasury umbrella include the IRS, U.S. bills and other short-term Short-term Any investments with a maturity of one year or less. short-term 1. Of or relating to a gain or loss on the value of an asset that has been held less than a specified period of time. securities. As a result, the weighted average yield on securities available for sale decreased to 3.25% at June 30, 2004 as compared to 3.62% at March 31, 2004. This contributed to a 22 basis point decrease in the net interest margin to 3.28% for the quarter ended June 30, 2004 compared to 3.50% for the quarter ended March 31, 2004, and the net interest margin decreased 13 basis points to 3.28% compared to 3.41% for the comparable period in 2003. The weighted average interest rate for interest-earning assets decreased 28 basis points to 4.58% for the three months ended June 30, 2004 compared to 4.86% for the three months ended June 30, 2003, and for the six months ended June 30, 2004, it decreased 32 basis points to 4.68% compared to 5.00% for the comparable period in 2003. Total interest expense decreased $1.2 million or 8.83% to $12.8 million for the three months ended June 30, 2004 compared to $14.0 million for the comparable quarter in 2003. For the six months ended June 30, 2004, interest expense decreased $3.6 million or 12.34% compared to the six months ended June 30, 2003. The weighted average interest rate for interest-bearing Adj. 1. interest-bearing - of financial obligations on which interest is paid liabilities was 1.69% for the quarter ended June 30, 2004. This represents an increase of 2 basis points compared to the trailing quarter and a decrease of 24 basis points compared to the second quarter of 2003. Non-Interest Income Non-interest income was $6.7 million for the quarter and $14.4 million for the six months ended June 30, 2004. These results represent increases of $1.6 million or 30.92% and $3.8 million or 35.50%, respectively, as compared to the same three and six month periods in 2003. Fee income from retail deposits increased $1.1 million or 31.58% to $4.8 million for the three months ended June 30, 2004 compared to $3.7 million for the three months ended June 30, 2003. For the six months ended June 30, 2004, fee income from retail deposits increased $1.7 million or 22.40% to $9.4 million compared to $7.7 million for the comparable period in 2003. For the six months ended June 30, 2004, gain on sale of loans increased $735 thousand to $1.3 million compared to $577 thousand, and gains on securities transactions increased $739 thousand to $735 thousand compared to a loss of $4 thousand for the six months ended June 30, 2003. Non-Interest Expense For the three months ended June 30, 2004, non-interest expense increased $1.4 million or 5.59% to $26.1 million compared to $24.7 million for the three months ended June 30, 2003. Compared to the trailing quarter, non-interest expense decreased $589 thousand or 2.21%. For the three months ended June 30, 2004 stock-based compensation was $2.2 million, and for the six months ended June 30, 2004, stock-based compensation was $4.4 million. There were no expenses associated with these plans in the comparable periods in 2003. Employee Stock Ownership Plan expense for the six months ended June 30, 2004 increased $230 thousand to $1.5 million compared to $1.2 million for the six months ended June 30, 2003. For the six months ended June 30, 2004, expense associated with executive severance The act of dividing, or the state of being divided. The term severance has unique meanings in different branches of the law. Courts use the term in both civil and criminal litigation in two ways: first, when dividing a lawsuit into two or more parts, and second, when was $1.2 million. For the three months ended June 30, 2004, advertising expense increased $806 thousand or 96.53% to $1.6 million compared to $835 thousand for the three months ended June 30, 2003. For the six months ended June 30, 2004, advertising increased $1.5 million or 104.02% to $3.0 million compared to $1.5 million for the six months ended June 30, 2003. Advertising has been increased in support of the Company's focus on core deposit generation, small business lending, retail lending and expanding customer relationships in a competitive marketplace. For the quarter ended June 30, 2004, employee health insurance decreased $443 thousand or 38.86% compared to $1.1 million for the quarter ended June 30, 2003 due primarily to a decrease in claims. For the six months ended June 30, 2004, employee health insurance decreased $253 thousand or 11.70% to $1.9 million compared to $2.2 million for the six months ended June 30, 2003. Asset Quality Asset quality remains strong. Total 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. as of June 30, 2004 were $4.0 million or 0.17% of loans compared to $4.4 million or 0.19% of total loans at March 31, 2004 and $5.7 million or 0.28% of total loans at June 30, 2003. POST EARNINGS CONFERENCE CALL Representatives of the Company will hold a conference call for investors at 10:00 a.m. Eastern Time on Monday Monday: see week. July 26, 2004 regarding highlights of the Company's second quarter 2004 financial results. The call can be accessed by dialing 1-800-299-8538 (Domestic) or 1-617-786-2902 (International) and stating the pass code number: 93708434. Internet access See how to access the Internet. to the call is also available (listen only) at www.providentnj.com by going to Investor Relations Investor relations The process by which the corporation communicates with its investors. and clicking on Webcast. FORWARD LOOKING STATEMENTS Certain statements contained herein are "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. " within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Such forward-looking statements may be identified by reference to a future period or periods, or by the use of forward-looking for·ward-look·ing adj. Concerned with or making provision for the future: forward-looking educators; a forward-looking corporate plan. Adj. 1. terminology The terminology used in the computer and telecommunications field adds tremendous confusion not only for the lay person, but for the technicians themselves. What many do not realize is that terms are made up by anybody and everybody in a nonchalant, casual manner without any regard or , such as "may," "will," "believe," "expect," "estimate," "anticipate," "continue," or similar terms or variations on those terms, or the negative of those terms. Forward-looking statements are subject to numerous risks and uncertainties, including, but not limited to, those related to the economic environment, particularly in the market areas in which the Company operates, competitive products and pricing, fiscal and monetary policies of the U.S. Government, changes in government regulations affecting financial institutions, including regulatory reg·u·late tr.v. reg·u·lat·ed, reg·u·lat·ing, reg·u·lates 1. To control or direct according to rule, principle, or law. 2. fees and capital requirements Capital requirements Financing required for the operation of a business, composed of long-term and working capital plus fixed assets. , changes in prevailing interest rates, acquisitions and the integration of acquired businesses, credit risk management, asset-liability management, the financial and securities markets and the availability of and costs associated with sources of liquidity. The Company wishes to caution readers not to place undue reliance on any such forward-looking statements, which speak only as of the date made. The Company wishes to advise readers that the factors listed above could affect the Company's financial performance and could cause the Company's actual results for future periods to differ materially from any opinions or statements expressed with respect to future periods in any current statements. The Company does not undertake and specifically declines any obligation to publicly release the result of any revisions ReVisions is a 2004 anthology of alternate history short-stories. It is edited by Julie E. Czerneda and Isaac Szpindel. Contents Title Author The Resonance of Light James Alan Gardner Out of China Julie E. , which may be made to any forward-looking statements to reflect events or circumstances CIRCUMSTANCES, evidence. The particulars which accompany a fact. 2. The facts proved are either possible or impossible, ordinary and probable, or extraordinary and improbable, recent or ancient; they may have happened near us, or afar off; they are public or after the date of such statements or to reflect the occurrence of anticipated or unanticipated events.
PROVIDENT FINANCIAL SERVICES, INC. AND SUBSIDIARY
Consolidated Statements of Condition
June 30, 2004 (Unaudited) and December 31, 2003
(Dollars in Thousands)
June 30, December 31,
Assets 2004 2003
-------- ------------
Cash and due from banks $ 90,655 $ 106,228
Federal funds sold 66,000 --
Short-term investments 51,392 69,624
---------- ----------
Total cash and cash equivalents 208,047 175,852
---------- ----------
Investment securities (market value of $467,694 471,471 517,789
(unaudited) and $524,429 at June 30, 2004
and December 31, 2003, respectively)
Securities available for sale, at fair value 1,025,938 1,151,829
Federal Home Loan Bank stock 31,955 34,585
Loans 2,381,702 2,237,367
Less allowance for loan losses 20,920 20,631
---------- ----------
Net loans 2,360,782 2,216,736
---------- ----------
Other real estate owned, net 32 41
Banking premises and equipment, net 47,297 46,741
Accrued interest receivable 16,187 16,842
Intangible assets 23,575 23,938
Bank owned life insurance 73,444 71,506
Other assets 37,666 29,019
---------- ----------
Total assets $4,296,394 $4,284,878
========== ==========
Liabilities and Equity
Deposits:
Demand deposits $ 815,564 $ 774,988
Savings deposits 997,373 987,877
Certificates of deposit of $100,000 or more 161,181 148,306
Other time deposits 769,801 784,805
---------- ----------
Total deposits 2,743,919 2,695,976
Mortgage escrow deposits 12,591 11,061
Borrowed funds 694,256 736,328
Other liabilities 29,375 24,394
---------- ----------
Total liabilities 3,480,141 3,467,759
---------- ----------
Stockholders' Equity:
Preferred stock, $0.01 par value,
50,000,000 shares authorized, none issued -- --
Common stock, $0.01 par value, 200,000,000 shares
authorized, 61,538,300 shares issued and
60,064,600 outstanding at June 30, 2004 and
61,538,300 shares issued and 60,600,100 shares
outstanding at December 31, 2003, respectively 615 615
Additional paid-in capital 608,281 606,541
Retained earnings 336,418 324,250
Accumulated other comprehensive income (2,154) 6,416
Less: Treasury Stock at cost (348,968 shares at
June 30, 2004) (6,706) --
Less: Unallocated common stock held by
Employee Stock Ownership Plan (77,257) (78,816)
Less: Common Stock acquired by the Stock Award
Plan (42,944) (41,887)
---------- ----------
Total stockholders' equity 816,253 817,119
---------- ----------
Total liabilities and stockholders' equity $4,296,394 $4,284,878
========== ==========
PROVIDENT FINANCIAL SERVICES, INC. AND SUBSIDIARY
Consolidated Statement of Income
Three Months and Six Months Ended June 30, 2004 and 2003 (Unaudited)
(Dollars in Thousands)
Three Months Ended Six Months Ended
June 30 June 30
---------------------- ----------------------
2004 2003 2004 2003
---------- ---------- ---------- ----------
Interest income:
Real estate secured
loans $ 23,539 $ 20,815 $ 47,305 $ 42,192
Commercial loans 3,728 5,504 7,026 11,058
Consumer loans 4,761 4,577 9,396 9,389
Investment securities 4,581 4,862 9,723 8,530
Securities available for
sale 8,344 10,731 18,180 22,116
Other short-term
investments 130 176 300 244
Federal funds 234 379 374 693
---------- ---------- ---------- ----------
Total interest income 45,317 47,044 92,304 94,222
---------- ---------- ---------- ----------
Interest expense:
Deposits 7,936 10,019 15,802 22,170
Borrowed funds 4,885 4,044 9,604 6,812
---------- ---------- ---------- ----------
Total interest expense 12,821 14,063 25,406 28,982
---------- ---------- ---------- ----------
Net interest income 32,496 32,981 66,898 65,240
Provision for loan losses 1,050 300 1,650 900
---------- ---------- ---------- -----------
Net interest income
after provision for
loan losses 31,446 32,681 65,248 64,340
---------- ---------- ---------- ----------
Non-interest income:
Fees 4,812 3,657 9,437 7,710
Net gain (loss) on
securities
transactions 308 -- 735 (4)
Commissions 136 87 246 158
Bank owned life insurance 951 992 1,938 1,794
Other income 509 394 2,016 949
---------- ---------- ---------- ----------
Total non-interest
income 6,716 5,130 14,372 10,607
---------- ---------- ---------- ----------
Non-interest expense:
Salaries and employee
benefits 14,074 12,621 28,482 24,646
Net occupancy expense 3,720 3,425 7,518 6,835
Federal deposit insurance 103 126 206 234
Data processing expense 1,824 1,655 3,664 3,273
Advertising and promotion
expense 1,641 835 3,044 1,492
Amortization of
intangibles 573 939 1,095 2,134
Other operating expenses 4,142 5,096 8,734 9,612
Contribution to The
Provident Bank
Foundation -- -- -- 24,000
---------- ---------- ---------- ----------
Total non-interest
expense 26,077 24,697 52,743 72,226
---------- ---------- ---------- ----------
Income before income
tax expense 12,085 13,114 26,877 2,721
Income tax expense 3,504 4,276 8,002 326
---------- ---------- ---------- ----------
Net income $ 8,581 $ 8,838 $ 18,875 $ 2,395
========== ========== ========== ==========
Basic Earnings Per
Share $ 0.16 $ 0.15 $ 0.34 $ 0.02
Average basic shares
outstanding 54,733,527 59,655,159 54,791,399 59,655,159
Diluted Earnings Per
Share $ 0.16 $ 0.34
Average diluted shares
outstanding 54,733,609 55,092,056
PROVIDENT FINANCIAL SERVICES, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS
(dollars in thousands, except share data)(unaudited)
At or for the Three At or for the
Months Ended Six Months Ended
June 30 June 30
---------------------- ----------------------
2004 2003 2004 2003
---------- ---------- ---------- ----------
INCOME STATEMENT:
Net Interest Income $ 32,496 $ 32,981 $ 66,898 $ 65,240
Provision for Loan
Losses 1,050 300 1,650 900
Non-interest Income 6,716 5,130 14,372 10,607
Non-interest Expense 26,077 24,697 52,743 72,226
Income before income tax
expense 12,085 13,114 26,877 2,721
Net Income 8,581 8,838 18,875 2,395
Basic Earnings Per
Share (1) $ 0.16 $ 0.15 $ 0.34 $ 0.02
Diluted Earnings Per
Share (1) $ 0.16 $ 0.34
Interest Rate Spread 2.89% 2.93% 3.00% 2.94%
Net Interest Margin 3.28% 3.41% 3.39% 3.46%
PROFITABILITY:
Return on average assets 0.81% 0.86% 0.89% 0.12%
Return on average equity 4.21% 3.97% 4.65% 0.60%
Operating expense to
average assets 2.45% 2.39% 2.50% 3.60%
Efficiency ratio (net of
foundation expense) (2) 66.50% 64.80% 64.90% 63.58%
ASSET QUALITY:
Non-performing loans 3,986 5,723
Other real estate owned 32 1,834
Non-performing loans to
total loans 0.17% 0.28%
Non-performing assets to
total assets 0.09% 0.18%
Allowance for loan losses 20,920 21,517
Allowance for loan losses
to non-performing loans 524.84% 375.97%
Allowance for loan losses
to total loans 0.88% 1.06%
AVERAGE BALANCE SHEET
DATA:
Assets $4,252,727 $4,134,273 $4,241,480 $4,049,687
Loans, net 2,290,966 1,985,482 2,247,879 1,984,339
Earnings Assets 3,981,525 3,882,835 3,965,092 3,802,266
Core Deposits 1,768,765 1,628,895 1,755,395 1,648,440
Borrowings 693,534 580,374 691,009 498,662
Interest-Bearing
Liabilities 3,058,327 2,929,071 3,046,419 2,845,000
Stockholders' Equity 814,845 889,518 816,443 808,624
Average yield on
interest-earning assets 4.58% 4.86% 4.68% 5.00%
Average cost of interest
bearing liabilities 1.69% 1.93% 1.68% 2.05%
CAPITAL:
Leverage capital 18.82% 20.48% 18.82% 20.48%
Total-risk based capital 30.12% 34.29% 30.12% 34.29%
Average equity to
average assets 19.16% 21.52% 19.25% 19.97%
Notes
-----
(1) Basic and Diluted Earnings Per Share for the six months ended June
30, 2003, includes the results of operations from January 15,
2003, the date we completed our Plan of Conversion in the amount
of $1,415,000.
(2) Efficiency Ratio Calculation
6/30/2004 6/30/2003 6/30/2004 6/30/2003
---------- ---------- ---------- ----------
Net Interest Income $ 32,496 $ 32,981 $ 66,898 $ 65,240
Non Interest Income 6,716 5,130 14,372 10,607
---------- ---------- ---------- ----------
Total Income: $ 39,212 $ 38,111 $ 81,270 $ 75,847
========== ========== ========== ==========
Non-Interest Expense: $ 26,077 $ 24,697 $ 52,743 $ 72,226
LESS: Provident Bank
Charitable Foundation
Donation - - - (24,000)
---------- ---------- ---------- ----------
Adjusted Non-Interest
Expense $ 26,077 $ 24,697 $ 52,743 $ 48,226
========== ========== ========== ==========
Expense/Income: 66.50% 64.80% 64.90% 63.58%
========== ========== ========== ==========
Average Quarterly Balance
NET INTEREST MARGIN ANALYSIS
(Unaudited) June 30, 2004
(Dollars in Thousands) -------------
Average Average
Balance Interest Yield
----------------------------
Interest-Earning Assets:
Fed Funds Sold and
Other Short-Term Investments $ 147,058 $ 364 1.00%
Investment Securities (1) 494,080 4,581 3.73%
Securities Available for Sale 1,017,331 8,213 3.25%
Federal Home Loan bank Stock 32,090 131 1.64%
Net Loans (2)
Total Mortgage Loans 1,625,142 23,539 5.83%
Total Commercial Loans 342,126 3,728 4.38%
Total Consumer Loans 323,698 4,761 5.92%
---------- --------
Total Interest Earning Assets $3,981,525 45,317 4.58%
---------- --------
Non-Interest Earning Assets:
Cash and Due from Banks 81,782
Other Assets 189,420
----------
TOTAL ASSETS $4,252,727
==========
Interest-Bearing Liabilities:
Demand Deposits $ 436,910 821 0.76%
Savings Deposits 990,032 2,200 0.89%
Time Deposits 937,851 4,915 2.11%
---------- --------
TOTAL DEPOSITS 2,364,793 7,936 1.35%
---------- --------
Borrowed Funds 693,534 4,885 2.83%
---------- --------
TOTAL BORROWINGS 693,534 4,885 2.83%
---------- --------
Total Interest-Bearing Liabilities $3,058,327 12,821 1.69%
---------- --------
Non-Interest Bearing Liabilities 379,555
----------
TOTAL LIABILITIES 3,437,882
Equity 814,845
----------
TOTAL LIAB & CAPITAL $4,252,727
==========
Net Interest Income $ 32,496
========
Net interest rate spread 2.89%
=======
Net interest-earning assets $ 923,198
==========
Net Interest Margin (3) 3.28%
=======
Ratio of interest-earning assets to
total interest-bearing liabilities 1.30 x
==========
Average Quarterly Balance
NET INTEREST MARGIN ANALYSIS
(Unaudited) March 31, 2004
(Dollars in Thousands) --------------
Average Average
Balance Interest Yield
----------------------------
Interest-Earning Assets:
Fed Funds Sold and
Other Short-Term Investments $ 115,370 $ 310 1.08%
Investment Securities (1) 515,636 5,142 4.01%
Securities Available for Sale 1,079,578 9,723 3.62%
Federal Home Loan bank Stock 33,282 113 1.37%
Net Loans (2)
Total Mortgage Loans 1,650,565 23,766 5.79%
Total Commercial Loans 251,734 3,298 5.27%
Total Consumer Loans 302,494 4,635 6.16%
---------- --------
Total Interest Earning Assets $3,948,659 46,987 4.79%
---------- --------
Non-Interest Earning Assets:
Cash and Due from Banks 83,845
Other Assets 197,680
----------
TOTAL ASSETS $4,230,184
==========
Interest-Bearing Liabilities:
Demand Deposits $ 426,495 767 0.72%
Savings Deposits 978,051 2,162 0.89%
Time Deposits 941,481 4,937 2.11%
---------- --------
TOTAL DEPOSITS 2,346,027 7,866 1.35%
---------- --------
Borrowed Funds 688,484 4,719 2.76%
---------- --------
TOTAL BORROWINGS 688,484 4,719 2.76%
---------- --------
Total Interest-Bearing Liabilities $3,034,511 12,585 1.67%
---------- --------
Non-Interest Bearing Liabilities 377,633
----------
TOTAL LIABILITIES 3,412,144
Equity 818,040
----------
TOTAL LIAB & CAPITAL $4,230,184
==========
Net Interest Income $ 34,402
========
Net interest rate spread 3.12%
=======
Net interest-earning assets $ 914,148
==========
Net Interest Margin (3) 3.50%
=======
Ratio of interest-earning assets to
total interest-bearing liabilities 1.30 x
==========
------------------------------
(1) Average outstanding balance amounts shown are amortized cost.
(2) Average outstanding balances shown net of the allowance for loan
losses, deferred loan fees and expenses, loan premiums and
discounts and include non-accrual loans.
(3) Net interest income divided by average interest-earning assets.
The following table summarizes the net interest margin for the
previous year, inclusive.
06/30/04 03/31/04 12/31/03 09/30/03 06/30/03
2nd Qtr. 1st Qtr. 4th Qtr. 3rd Qtr. 2nd Qtr.
-------- -------- ------- -------- -------
Interest-Earning
Assets:
Securities 3.16% 3.53% 3.48% 2.84% 3.38%
Net Loans 5.62% 5.78% 5.70% 5.99% 6.31%
Total Interest-
Earning Assets 4.58% 4.79% 4.67% 4.48% 4.86%
Interest-Bearing
Liabilities:
Total Deposits 1.35% 1.35% 1.37% 1.47% 1.71%
Total Borrowings 2.83% 2.76% 2.61% 2.80% 2.79%
Total Interest-Bearing
Liabilities 1.69% 1.67% 1.64% 1.75% 1.93%
Interest Rate Spread 2.89% 3.12% 3.03% 2.73% 2.93%
Net Interest Margin 3.28% 3.50% 3.41% 3.14% 3.41%
Ratio of interest-earning
assets to total interest-
bearing liabilities 1.30x 1.30x 1.30x 1.31x 1.33x
Average YTD Balance
NET INTEREST MARGIN ANALYSIS
(Unaudited) June 30, 2004
(Dollars in Thousands) -------------
Average Average
Balance Interest Yield
----------------------------
Interest-Earning
Assets:
Fed Funds Sold and
Other Short-Term Investments $ 131,214 $ 674 1.03%
Investment Securities (1) 504,858 9,723 3.87%
Securities Available for Sale 1,048,455 17,935 3.44%
Federal Home Loan bank Stock 32,686 245 1.51%
Net Loans (2)
Total Mortgage Loans 1,637,212 47,305 5.81%
Total Commercial Loans 296,808 7,026 4.76%
Total Consumer Loans 313,859 9,396 6.02%
---------- --------
Total Interest Earning Assets $3,965,092 92,304 4.68%
---------- --------
Non-Interest Earning Assets:
Cash and Due from Banks 82,814
Other Assets 193,574
----------
TOTAL ASSETS $4,241,480
==========
Interest-Bearing Liabilities:
Demand Deposits $ 431,703 1,613 0.75%
Savings Deposits 984,036 4,362 0.89%
Time Deposits 939,671 9,827 2.10%
---------- --------
TOTAL DEPOSITS 2,355,410 15,802 1.35%
---------- --------
Borrowed Funds 691,009 9,604 2.79%
---------- --------
TOTAL BORROWINGS 691,009 9,604 2.79%
---------- --------
Total Interest-Bearing Liabilities: $3,046,419 25,406 1.68%
---------- --------
Non-Interest-Bearing Liabilities 378,618
----------
TOTAL LIABILITIES 3,425,037
Equity 816,443
----------
TOTAL LIAB & CAPITAL $4,241,480
==========
Net Interest Income $ 66,898
========
Net interest rate spread 3.00%
=======
Net interest-earning assets $ 918,673
==========
Net Interest Margin (3) 3.39%
=======
Ratio of interest-earning assets to total
interest-bearing liabilities 1.30 x
==========
Average YTD Balance
NET INTEREST MARGIN ANALYSIS
(Unaudited) June 30, 2003
(Dollars in Thousands) -------------
Average Average
Balance Interest Yield
----------------------------
Interest-Earning
Assets:
Fed Funds Sold and
Other Short-Term Investments $ 161,239 $ 937 1.17%
Investment Securities (1) 407,750 8,530 4.22%
Securities Available for Sale 1,247,408 21,708 3.51%
Federal Home Loan bank
Stock 22,635 408 3.63%
Net Loans (2)
Total Mortgage Loans 1,279,894 42,192 6.65%
Total Commercial Loans 415,321 11,058 5.37%
Total Consumer Loans 268,019 9,389 7.06%
---------- --------
Total Interest Earning Assets $3,802,266 94,222 5.00%
---------- --------
Non-Interest Earning Assets:
Cash and Due from Banks 81,319
Other Assets 166,102
----------
TOTAL ASSETS $4,049,687
==========
Interest-Bearing Liabilities:
Demand Deposits $ 401,145 1,955 0.98%
Savings Deposits 923,391 6,928 1.51%
Time Deposits 1,021,802 13,287 2.62%
---------- --------
TOTAL DEPOSITS 2,346,338 22,170 1.91%
---------- --------
Borrowed Funds 498,662 6,812 2.75%
---------- --------
TOTAL BORROWINGS 498,662 6,812 2.75%
---------- --------
Total Interest-Bearing Liabilities: $2,845,000 28,982 2.05%
---------- --------
Non-Interest-Bearing Liabilities 396,063
----------
TOTAL LIABILITIES 3,241,063
Equity 808,624
----------
TOTAL LIAB & CAPITAL $4,049,687
==========
Net Interest Income $ 65,240
========
Net interest rate spread 2.94%
=======
Net interest-earning assets $ 957,266
==========
Net Interest Margin (3) 3.46%
=======
Ratio of interest-earning assets to total
interest-bearing liabilities 1.34 x
==========
-----------------------
(1) Average outstanding balance amounts shown are amortized cost.
(2) Average outstanding balances shown net of the allowance for loan
losses, deferred loan fees and expenses, loan premiums and
discounts and include non-accrual loans.
(3) Net interest income divided by average interest-earning assets.
The following table summarizes the net interest margin for the
previous year, inclusive.
Six Months Ended
06/30/04 06/30/03 06/30/02
-------- -------- --------
Interest-Earning Assets:
Securities 3.35% 3.46% 4.91%
Net Loans 5.70% 6.43% 7.12%
Total Interest-Earning
Assets 4.68% 5.00% 6.46%
Interest-Bearing Liabilities:
Total Deposits 1.35% 1.91% 2.57%
Total Borrowings 2.79% 2.75% 4.33%
Total Interest-Bearing
Liabilities 1.68% 2.05% 2.72%
Interest Rate Spread 3.00% 2.94% 3.74%
Net Interest Margin 3.39% 3.46% 4.11%
Ratio of interest-earning assets
to total interest-bearing
liabilities 1.30x 1.34x 1.16x
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