ViewPoint Financial Group, Inc. Reports Second Quarter 2013 Earnings, Advances Commercial Bank Strategy

23 Jul, 2013, 16:15 ET from ViewPoint Financial Group, Inc.

PLANO, Texas, July 23, 2013 /PRNewswire/ -- ViewPoint Financial Group, Inc. (NASDAQ: VPFG) (the "Company"), the holding company for ViewPoint Bank, N.A. (the "Bank"), today announced net income of $8.2 million for the quarter ended June 30, 2013, an increase of $1.7 million, or 25.9%, from the quarter ended June 30, 2012. Compared to the first quarter of 2013, net income increased by $116,000, or 1.4%. Basic and diluted earnings per share increased $0.04 to $0.21 for the quarter ended June 30, 2013, from $0.17 for the quarter ended June 30, 2012, while earnings per share did not change on a linked quarter basis.

Second Quarter 2013 Results

  • Solid commercial loan growth continues, driving shift in earning asset revenue: Our commercial loan portfolio, consisting of commercial real estate and commercial and industrial loans, totaled $1.3 billion at June 30, 2013, up $117.8 million, or 9.8%, from March 31, 2013, and up $359.5 million, or 37.5%, from June 30, 2012. Interest income on the commercial loan portfolio increased $3.6 million, or 24.9%, from the quarter ended June 30, 2012, representing a shift in earning asset revenue. Commercial loans generated 50.7% of the Company's interest income earned during the second quarter of 2013, compared to 40.8% of interest income earned during the same quarter in 2012.
  • Net interest margin increased by ten basis points compared to the second quarter of 2012: Improvements in the earning asset mix and lower deposit and borrowing rates drove a ten basis point increase in the net interest margin to 3.72% for the three months ended June 30, 2013, compared to 3.62% for the same period in 2012.  Compared to the first quarter of 2013, the net interest margin increased by eight basis points, from 3.64% for the three months ended March 31, 2013.
  • Asset quality improved, positively impacting earnings: During the second quarter of 2013, two commercial real estate loans that were classified as troubled debt restructurings were paid in full, resulting in the recovery of $480,000 of accumulated interest, as well as the recapture of $91,000 in allowance for loan losses that was previously allocated to these two loans. These transactions reduced troubled debt restructurings by $5.9 million, which includes a $2.5 million reduction in non-performing loans.
  • Linked quarter increase in Warehouse Purchase Program loans: Warehouse Purchase Program loans totaled $904.2 million at June 30, 2013, up $146.8 million from March 31, 2013. Compared to June 30, 2012, balances declined by $4.3 million.

"I am very pleased with our quarter," said President and CEO Kevin Hanigan. "Our key ratios (NIM, Efficiency Ratio, ROA, and ROE) are all appreciably up from the second quarter of 2012, resulting in a 24% earnings per share increase that was fueled by a 38% increase in commercial loans."

Financial Highlights

At or For the Quarters Ended

June

March

June

(unaudited)

2013

2013

2012

(Dollars in thousands, except per share amounts)

Net interest income

$

30,438

$

28,525

$

29,186

Provision for loan losses

1,858

883

1,447

Non-interest income

5,743

5,859

8,513

Non-interest expense

21,703

20,873

26,323

Income tax expense

4,446

4,570

3,437

Net income

$

8,174

$

8,058

$

6,492

Basic earnings per common share

$

0.21

$

0.21

$

0.17

Weighted average common shares outstanding - basic

37,545,050

37,529,793

37,116,322

Estimated Tier 1 risk-based capital ratio1

17.97

%

19.56

%

22.55

%

Tangible common equity to tangible assets - Non-GAAP 2

14.10

%

14.95

%

12.96

%

1 Calculated at the ViewPoint Financial Group, Inc. level, which is subject to the capital adequacy requirements of the Federal Reserve. The decline in our June 2013 and March 2013 ratio is primarily the result of a risk weighting change from 50% to 100% on our Warehouse Purchase Program loans. 2 See the section labeled "Supplemental Information- Non-GAAP Financial Measures" at the end of this document.

 

Net Interest Income and Net Interest Margin

For the Quarters Ended

June

March

June

(unaudited)

2013

2013

2012

(Dollars in thousands)

Net interest income

$

30,438

$

28,525

$

29,186

Net interest margin

3.72

%

3.64

%

3.62

%

Selected average balances:

Total earning assets

$

3,271,436

$

3,134,030

$

3,221,482

Total loans

2,544,695

2,405,825

2,211,630

Total securities

680,931

674,109

976,611

Total deposits

2,187,865

2,160,363

2,244,578

Total borrowings

679,693

590,238

626,055

Total non-interest-bearing demand deposits

393,815

367,217

316,237

Total interest-bearing liabilities

2,473,743

2,383,384

2,554,396

Net interest income for the quarter ended June 30, 2013, was $30.4 million, a $1.3 million increase from the second quarter of 2012 and a $1.9 million increase from the first quarter of 2013. The increase from the second quarter of 2012 was primarily due to a $1.9 million increase in interest income on loans and a $1.1 million decrease in interest expense, partially offset by a $1.7 million decrease in interest income on securities. 

The increase in interest income on loans for the current quarter compared to the quarter ended June 30, 2012, was primarily due to an increase in the average balance of commercial loans, which increased by $367.4 million, or 40.4%. Additionally, the average balance of loans held for sale increased by $74.5 million compared to the second quarter of 2012. This increase was partially offset by the 43 basis point decline in the average yield on loans to 5.05% for the quarter ended June 30, 2013, from 5.48% for the same period in 2012.

The decrease in interest expense primarily reflects lower deposit and borrowing rates, as well as a decline in the average balance of interest-bearing liabilities for the quarter ended June 30, 2013, compared to the same quarter in 2012. Average interest-bearing liabilities decreased by $80.7 million to $2.47 billion for the quarter ended June 30, 2013, compared to $2.55 billion for the same period in 2012, while the average cost of interest-bearing liabilities declined by 14 basis points to 0.79% for the quarter ended June 30, 2013, compared to 0.93% for the same period in 2012. 

The average balance of securities declined by $295.7 million, or 30.3%, for the second quarter of 2013 compared to the same period in 2012, while the average yield on securities declined by 14 basis points for the comparable periods. The decline in the securities portfolio over the past year was primarily due to normal paydowns and the sale of securities that were not consistent with our portfolio requirements.

The increase in net interest income for the current period compared to the first quarter of 2013 was primarily due to a $1.8 million increase in interest income earned on loans, driven primarily by higher average balances in our commercial loan portfolio and loans held for sale. The average yield earned on the loan portfolio remained constant at 5.05% for the linked quarters and was positively impacted by the $480,000 interest recovery on two commercial real estate loans that were paid in full during the second quarter of 2013. Compared to the quarter ended March 31, 2013, the average balance of commercial loans increased by $155.1 million, or 13.8%, while the average balance of loans held for sale increased by $17.3 million for the quarter ended June 30, 2013, compared to the quarter ended March 31, 2013.

Interest income on the commercial loan portfolio increased $3.6 million, or 24.9%, for the quarter ended June 30, 2013, compared to the same quarter last year, representing a shift in earning asset revenue as we continue our commercial banking strategy. Commercial loans generated 50.7% of the Company's interest income earned during the second quarter of 2013, compared to 40.8% of interest income earned during the same quarter in 2012.

The net interest margin for the second quarter of 2013 was 3.72%, a ten basis point increase from the second quarter of 2012 and an eight basis point increase from the first quarter of 2013. Accretion of interest related to the Highlands acquisition contributed nine basis points to the net interest margin for the quarter ended June 30, 2013, compared to 11 basis points for the quarter ended March 31, 2013. The average yield on earning assets for the quarter ended June 30, 2013 was 4.32%, a four basis point decrease from the second quarter of 2012 and a five basis point increase from the first quarter of 2013. 

Non-interest Income

Non-interest income for the quarter ended June 30, 2013, was $5.7 million, a $2.8 million decrease from the second quarter of 2012 and a $116,000 decrease from the first quarter of 2013. The decrease from the second quarter of 2012 was primarily attributable to a $2.2 million gain on the sale of mortgage loans and a $1.8 million increase in the value of an investment in a community development-oriented private equity fund used for Community Reinvestment Act purposes recorded in 2012 with no comparable gains in the 2013 period. These gains were offset by an $818,000 goodwill impairment charge recorded in the second quarter of 2012 due to the sale of ViewPoint Mortgage ("VPM"), which closed in the third quarter of 2012. Also, offsetting the decline in non-interest income was a $500,000 increase in gain on sale and disposition of assets for the second quarter of 2013 compared to the same period last year, primarily due to gains on the disposition of purchased credit impaired loans (acquired from Highlands) during the second quarter of 2013, as well as write-offs of VPM assets recorded during the second quarter of 2012.

The decrease in non-interest income compared to the first quarter of 2013 was primarily due to a $784,000 increase in the value of an investment in a community development-oriented private equity fund used for Community Reinvestment Act purposes recorded in the first quarter of 2013 with no comparable gain recorded in the second quarter of 2013, partially offset by a $477,000 increase in service charges and fees in the second quarter of 2013 compared to the first quarter of 2013. This increase in service charges and fees was primarily due to a $260,000 increase in commercial loan pre-payment penalty fee income.

Non-interest Expenses

Non-interest expense for the quarter ended June 30, 2013, was $21.7 million, a $4.6 million decrease from the second quarter of 2012 and an $830,000 increase from the first quarter of 2013. The decrease in non-interest expense compared to the second quarter of 2012 was primarily due to acquisition costs of $3.7 million reflected in the quarter ended June 30, 2012, with no comparable expense recorded in the same period in 2013, and a $1.6 million decrease in salary and benefits expense primarily due to savings resulting from the sale of VPM, as well as severance costs incurred during the second quarter of 2012 due to the Highlands acquisition and the sale of VPM. These decreases were partially offset by $400,000 in director retirement payments made during the second quarter of 2013, which are reflected in other non-interest expense.

The $830,000 increase in non-interest expense for the second quarter of 2013 compared to the first quarter of 2013 was primarily due to director retirement payments, as well as increases in advertising, data processing, and occupancy and equipment expense as the Company continues to make investments in its infrastructure to support its commercial banking strategy.

Financial Condition

Gross loans held for investment at June 30, 2013, increased by $89.5 million, or 5.1%, from March 31, 2013, and 14.7% from June 30, 2012. Loans held for sale at June 30, 2013 increased by $146.8 million, or 19.4%, from March 31, 2013. Compared to June 30, 2012, loans held for sale decreased by 2.3%. Commercial real estate balances at June 30, 2013, increased by $107.2 million, or 11.9%, from March 31, 2013, and 32.1% from June 30, 2012, while commercial and industrial loans at June 30, 2013, increased by $10.6 million, or 3.5%, from March 31, 2013, and 58.4% from June 30, 2012. 

Oil and gas loans, which are included in our commercial and industrial loans, totaled $57.5 million at June 30, 2013. To further develop this line of business, in May 2013, the Company announced the formation of a new energy lending group. The Energy Finance group will focus on providing loans to private and public oil and gas companies throughout the United States, with an emphasis on reserve-based transactions for development drilling, capital expenditures against oil and gas reserves, and acquisitions of oil and gas reserves. The group's offerings will also include the Bank's full array of commercial services, including Treasury Management and Letters of Credit. 

Total deposits decreased by $23.9 million, or 1.1%, to $2.19 billion at June 30, 2013, from $2.21 billion at March 31, 2013, which includes declines in all deposit categories except for time deposits. Compared to June 30, 2012, deposits decreased by $40.2 million, or 1.8%, which includes a $42.6 million increase in non-interest-bearing demand deposits that was offset by declines in interest-bearing demand and time deposits.

In line with our commercial banking strategy, commercial non-interest-bearing demand deposits totaled $248.4 million at June 30, 2013, compared to $212.3 million at June 30, 2012, and helped to generate $196,000 in billed analysis treasury management fee income during the six months ended June 30, 2013.

Total shareholders' equity increased by $2.5 million to $533.4 million at June 30, 2013, from $531.0 million at March 31, 2013.  The Company's tangible common equity ratio was 14.1% at June 30, 2013, a decrease of 85 basis points from March 31, 2013, and an increase of 114 basis points from June 30, 2012. During the quarter ended June 30, 2013, the Company repurchased 83,800 shares of its common stock, resulting in a $1.6 million reduction in equity. 

Credit Quality

At or For the Quarters Ended

June

March

June

(unaudited)

2013

2013

2012

(Dollars in thousands)

Net charge-offs

$

1,223

$

292

$

241

Net charge-offs/Average loans held for investment

0.27

%

0.07

%

0.06

%

Provision for loan losses

$

1,858

$

883

$

1,447

Non-performing loans ("NPLs")

23,799

27,721

22,557

NPLs/Total loans held for investment 1

1.30

%

1.59

%

1.41

%

Non-performing assets ("NPAs")

$

24,356

$

29,226

$

25,880

NPAs/Total assets

0.68

%

0.87

%

0.70

%

NPAs/Loans held for investment and foreclosed assets

1.33

1.67

1.61

Allowance for loan losses

$

19,277

$

18,642

$

19,229

Allowance for loan losses/Total loans held for investment 1

1.05

%

1.07

%

1.20

%

Allowance for loan losses/Total loans held for investment excluding acquired loans 2

1.15

1.19

1.47

Allowance for loan losses/NPLs 1

81.00

67.25

85.25

1 Reflects the impact of loans acquired in the Highlands acquisition, which were initially recorded at fair value, with no allocated allowance for loan losses. 2 Excludes loans acquired from Highlands, which were initially recorded at fair value.

Non-performing loans to total loans at June 30, 2013, was 1.30%, compared to 1.59%  at March 31, 2013, and 1.41% at June 30, 2012. Non-performing loans decreased by $3.9 million to $23.8 million at June 30, 2013, from $27.7 million at March 31, 2013. Non-performing loans increased by $1.2 million from June 30, 2012, primarily due to increases in commercial and industrial and consumer real estate non-performing loans, which were partially offset by a decrease in commercial real estate non-performing loans for the comparable periods. During the second quarter of 2013, two commercial real estate loans that were classified as substandard troubled debt restructurings were paid in full, resulting in the recovery of $480,000 of accumulated interest, as well as the recapture of $91,000 in allowance for loan losses that was previously allocated to these two loans. These transactions reduced troubled debt restructurings by $5.9 million, which includes a $2.5 million reduction in non-performing loans.

Net charge-offs totaled $1.2 million for the second quarter of 2013, compared to $292,000 for the first quarter of 2013 and $241,000 for the second quarter of 2012. Charge-offs for the second quarter of 2013 included charge-offs related to two commercial real estate loans that totaled $716,000, which settled the remaining balance of the loans. These two loans previously had $941,000 of reserves allocated, which resulted in a net reduction of reserves totaling $225,000.  Provision expense for the quarter ended June 30, 2013, totaled $1.9 million, up $411,000 from the quarter ended June 30, 2012, and up $975,000 from the quarter ended March 31, 2013, primarily due to increased commercial loan production.

Subsequent Events

The Company is required under generally accepted accounting principles to evaluate subsequent events through the filing of its consolidated financial statements for the quarter ended June 30, 2013, on Form 10-Q.  As a result, the Company will continue to evaluate the impact of any subsequent events on critical accounting assumptions and estimates made as of June 30, 2013, and will adjust amounts preliminarily reported, if necessary.

Conference Call

The Company will also host an investor conference call to review these results on Wednesday, July 24, 2013, at 8 a.m. Central Time. Participants are asked to call (toll-free) 1-888-317-6016 at least five minutes prior to the call.  International participants are asked to call 1-412-317-6016 and participants in Canada are asked to call (toll-free) 1-855-669-9657.  The call and corresponding presentation slides will be webcast live on the home page of the Company's website, www.viewpointfinancialgroup.com.  An audio replay will be available one hour after the conclusion of the call at 1-877-344-7529, Conference #10030672. This replay, as well as the webcast, will be available until the Company's next quarterly webcast/conference call. 

About ViewPoint Financial Group, Inc.

ViewPoint Financial Group, Inc. is the holding company for ViewPoint Bank, N.A. ViewPoint Bank, N.A. operates 31 banking offices in the Dallas/Fort Worth metropolitan area, including two First National Bank of Jacksboro locations in Jack and Wise Counties. For more information, please visit www.viewpointbank.com or www.viewpointfinancialgroup.com.

When used in filings by the Company with the Securities and Exchange Commission (the "SEC") in the Company's press releases or other public or shareholder communications, and in oral statements made with the approval of an authorized executive officer, the words or phrases "will likely result," "are expected to," "will continue," "is anticipated," "estimate," "project," "intends" or similar expressions are intended to identify "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements are subject to certain risks and uncertainties, including, among other things: changes in economic conditions; legislative changes; changes in policies by regulatory agencies; fluctuations in interest rates; the risks of lending and investing activities, including changes in the level and direction of loan delinquencies and write-offs and changes in estimates of the adequacy of the allowance for loan losses; the Company's ability to access cost-effective funding; fluctuations in real estate values and both residential and commercial real estate market conditions; demand for loans and deposits in the Company's market area; the industry-wide decline in mortgage production; competition; changes in management's business strategies; our ability to successfully integrate any assets, liabilities, customers, systems and management personnel we have acquired or may acquire into our operations and our ability to realize related revenue synergies and cost savings within expected time frames and any goodwill charges related thereto; and other factors set forth under Risk Factors in the Company's Form 10-K that could cause actual results to differ materially from historical earnings and those presently anticipated or projected. The factors listed above could materially 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 that may be made to any forward-looking statements to reflect events or circumstances occurring after the date of such statements. 

 

 

VIEWPOINT FINANCIAL GROUP, INC.

Consolidated Balance Sheets

June 30, 2013

March 31, 2013

December 31, 2012

September 30, 2012

June 30, 2012

(Dollars in thousands)

ASSETS

(unaudited)

(unaudited)

(unaudited)

(unaudited)

Cash and due from financial institutions

$

30,504

$

25,724

$

34,227

$

24,429

$

30,407

Short-term interest-bearing deposits in other financial institutions

27,280

26,783

34,469

36,301

39,571

Total cash and cash equivalents

57,784

52,507

68,696

60,730

69,978

Securities available for sale, at fair value

287,834

315,438

287,034

316,780

467,515

Securities held to maturity

330,969

329,993

360,554

396,437

430,368

Total securities

618,803

645,431

647,588

713,217

897,883

Loans held for sale 1

904,228

757,472

1,060,720

1,014,445

925,637

Loans held for investment

1,835,187

1,745,737

1,690,769

1,651,639

1,600,556

Gross loans

2,739,415

2,503,209

2,751,489

2,666,084

2,526,193

Less: allowance for loan losses and deferred fees on loans held for investment

(19,162)

(18,282)

(17,565)

(19,719)

(18,822)

Net loans

2,720,253

2,484,927

2,733,924

2,646,365

2,507,371

FHLB and Federal Reserve Bank stock, at cost

41,475

31,607

45,025

43,383

45,241

Bank-owned life insurance

35,231

35,078

34,916

34,701

34,491

Premises and equipment, net

52,865

53,050

53,160

53,348

53,725

Goodwill

29,650

29,650

29,650

29,650

29,203

Other assets

38,423

41,386

50,099

54,639

54,964

Total assets

$

3,594,484

$

3,373,636

$

3,663,058

$

3,636,033

$

3,692,856

LIABILITIES AND SHAREHOLDERS' EQUITY

Non-interest-bearing demand

$

384,836

$

392,759

$

357,800

$

349,880

$

342,228

Interest-bearing demand

464,262

481,966

488,748

471,672

509,650

Savings and money market

887,082

888,874

880,924

897,515

885,550

Time

453,000

449,491

450,334

473,834

491,978

Total deposits

2,189,180

2,213,090

2,177,806

2,192,901

2,229,406

FHLB advances

800,208

564,221

892,208

852,168

875,102

Repurchase agreement and other borrowings

25,000

25,000

25,000

25,000

38,682

Accrued expenses and other liabilities

46,662

40,358

47,173

49,611

44,091

Total liabilities

3,061,050

2,842,669

3,142,187

3,119,680

3,187,281

Shareholders' equity

Common stock

399

399

396

396

393

Additional paid-in capital

373,378

373,492

372,168

369,904

367,938

Retained earnings

176,569

172,386

164,328

161,887

153,722

Accumulated other comprehensive income, net

271

2,239

1,895

2,449

2,171

Unearned Employee Stock Ownership Plan (ESOP) shares

(17,183)

(17,549)

(17,916)

(18,283)

(18,649)

Total shareholders' equity

533,434

530,967

520,871

516,353

505,575

Total liabilities and shareholders' equity

$

3,594,484

$

3,373,636

$

3,663,058

$

3,636,033

$

3,692,856

1 Loans held for sale at June 30, 2012 included loans originated by ViewPoint Mortgage.

 

 

VIEWPOINT FINANCIAL GROUP, INC.

Consolidated Quarterly Statements of Income (unaudited)

For the Quarters Ended

Second Quarter 2013 Compared to:

Jun 30,

 2013

Mar 31,

 2013

Dec 31,

 2012

Sep 30,

2012

Jun 30,

2012

First Quarter 2013

Second Quarter

2012

Interest and dividend income

(Dollars in thousands)

  Loans, including fees

$

32,151

$

30,378

$

33,247

$

32,739

$

30,290

$

1,773

5.8

%

$

1,861

6.1

%

  Taxable securities

2,457

2,403

2,591

3,616

4,185

54

2.2

(1,728)

(41.3)

  Nontaxable securities

529

474

472

473

473

55

11.6

56

11.8

  Interest-bearing deposits in other financial institutions

25

31

31

29

38

(6)

(19.4)

(13)

(34.2)

  FHLB and Federal Reserve Bank stock

134

133

140

151

141

1

0.8

(7)

(5.0)

35,296

33,419

36,481

37,008

35,127

1,877

5.6

169

0.5

Interest Expense

  Deposits

2,450

2,432

2,321

2,656

3,247

18

0.7

(797)

(24.5)

  FHLB advances

2,205

2,261

2,423

2,515

2,415

(56)

(2.5)

(210)

(8.7)

  Repurchase agreement

203

201

205

217

251

2

1.0

(48)

(19.1)

  Other borrowings

4

1

28

N/M

(28)

(100.0)

4,858

4,894

4,953

5,389

5,941

(36)

(0.7)

(1,083)

(18.2)

Net interest income

30,438

28,525

31,528

31,619

29,186

1,913

6.7

1,252

4.3

Provision (benefit) for loan losses

1,858

883

(17)

814

1,447

975

110.4

411

28.4

Net interest income after provision (benefit) for loan losses

28,580

27,642

31,545

30,805

27,739

938

3.4

841

3.0

  Service charges and fees

4,768

4,291

5,562

4,885

4,827

477

11.1

(59)

(1.2)

  Other charges and fees

179

212

142

144

165

(33)

(15.6)

14

8.5

  Net gain on sale of mortgage loans

1,030

2,174

N/M

(2,174)

(100.0)

  Bank-owned life insurance income

153

162

216

210

165

(9)

(5.6)

(12)

(7.3)

  Gain (loss) on sale of available for sale securities

(177)

898

116

177

(100.0)

(116)

(100.0)

  Gain (loss) on sale and disposition of assets

444

230

(241)

187

(56)

214

93.0

500

(892.9)

  Impairment of goodwill

(818)

N/M

818

(100.0)

  Other

199

1,141

815

465

1,940

(942)

(82.6)

(1,741)

(89.7)

5,743

5,859

6,494

7,819

8,513

(116)

(2.0)

(2,770)

(32.5)

Non-interest expense

Salaries and employee benefits

12,528

12,915

13,200

12,685

14,110

(387)

(3.0)

(1,582)

(11.2)

Acquisition costs

242

3,741

N/M

(3,741)

(100.0)

Advertising

751

513

599

379

490

238

46.4

261

53.3

Occupancy and equipment

1,938

1,790

1,934

2,009

1,952

148

8.3

(14)

(0.7)

Outside professional services

570

684

568

578

691

(114)

(16.7)

(121)

(17.5)

Regulatory assessments

650

579

661

668

624

71

12.3

26

4.2

Data processing

1,729

1,518

1,717

1,530

1,617

211

13.9

112

6.9

Office operations

1,751

1,648

1,831

1,834

1,934

103

6.3

(183)

(9.5)

Other

1,786

1,226

1,195

1,285

1,164

560

45.7

622

53.4

21,703

20,873

21,705

21,210

26,323

830

4.0

(4,620)

(17.6)

Income before income tax expense

12,620

12,628

16,334

17,414

9,929

(8)

(0.1)

2,691

27.1

Income tax expense

4,446

4,570

5,973

6,098

3,437

(124)

(2.7)

1,009

29.4

Net income

$

8,174

$

8,058

$

10,361

$

11,316

$

6,492

$

116

1.4

%

$

1,682

25.9

%

 

VIEWPOINT FINANCIAL GROUP, INC.

Selected Financial Highlights (unaudited)

At or For the Quarters Ended

June

March

June

2013

2013

2012

(Dollars in thousands, except share and per share amounts)

SHARE DATA:

Basic earnings per common share

$

0.21

$

0.21

$

0.17

Diluted earnings per common share

$

0.21

0.21

0.17

Dividends declared per share 1

$

0.10

$

$

0.06

Total shareholders' equity

$

533,434

$

530,967

$

505,575

Common shareholders' equity per share (book value per share)

$

13.36

$

13.29

$

12.85

Tangible book value per share- Non-GAAP2

$

12.58

$

12.51

$

12.06

Market value per share for the quarter:

High

$

20.81

$

21.75

$

16.72

Low

$

17.97

$

19.94

$

14.79

Close

$

20.81

$

20.11

$

15.64

Shares outstanding at end of period

39,926,716

39,948,031

39,344,167

Weighted average common shares outstanding- basic

37,545,050

37,529,793

37,116,322

Weighted average common shares outstanding- diluted

37,692,513

37,681,402

37,236,213

KEY RATIOS:

Return on average common shareholders' equity

6.14

%

6.11

%

5.15

%

Return on average assets

0.95

%

0.97

%

0.76

%

Efficiency ratio3

60.45

%

61.86

%

61.20

%

Estimated Tier 1 risk-based capital ratio4

17.97

%

19.56

%

22.55

%

Estimated total risk-based capital ratio4

18.66

%

20.29

%

23.47

%

Estimated Tier 1 leverage ratio4

14.71

%

15.16

%

13.95

%

Tangible equity to tangible assets- Non-GAAP2

14.10

%

14.95

%

12.96

%

Number of employees- full-time equivalent

561

566

620

1 The quarter ended March 2013, reflects no dividend declaration as the Company accelerated the payment of its first quarter 2013 dividend, making two dividend payments of $0.10 each in the fourth quarter 2012. 2 See the section labeled "Supplemental Information- Non-GAAP Financial Measures" at the end of this document. 3 Calculated by dividing total non-interest expense by net interest income plus non-interest income, excluding gain (loss) on assets, impairment of goodwill, amortization of intangible assets, gains (losses) from securities transactions and other non-recurring items. 4 Calculated at the ViewPoint Financial Group, Inc. level, which is subject to the capital adequacy requirements of the Federal Reserve. Beginning March 2013, capital ratios reflect a risk weighting change from 50% to 100% on our Warehouse Purchase Program loans.

 

 

VIEWPOINT FINANCIAL GROUP, INC. Selected Loan Data (unaudited)

Ending Balances at

June 30, 2013

March 31, 2013

December 31, 2012

September 30, 2012

June 30, 2012

Loans:

(Dollars in thousands)

Loans held for sale 1

$

904,228

$

757,472

$

1,060,720

$

1,014,445

$

925,637

Commercial real estate

1,004,719

897,534

839,908

794,619

760,609

Commercial and industrial loans:

Commercial

288,054

271,605

245,799

226,391

180,706

Warehouse lines of credit

24,977

30,861

32,726

25,936

16,965

Total commercial and industrial loans

313,031

302,466

278,525

252,327

197,671

Consumer:

Consumer real estate

465,055

490,599

513,256

542,103

579,633

Other consumer loans

52,382

55,138

59,080

62,590

62,643

Total consumer

517,437

545,737

572,336

604,693

642,276

Gross loans held for investment

1,835,187

1,745,737

1,690,769

1,651,639

1,600,556

  Gross loans

$

2,739,415

$

2,503,209

$

2,751,489

$

2,666,084

$

2,526,193

Non-performing assets:

Commercial real estate

$

8,625

$

12,696

$

13,609

$

16,572

$

16,378

Commercial and industrial

6,849

6,807

5,401

4,597

873

Consumer real estate

7,913

7,840

7,931

6,661

5,270

Other consumer loans

412

378

262

251

36

Total non-performing loans

23,799

27,721

27,203

28,081

22,557

Foreclosed assets

557

1,505

1,901

3,850

3,323

Total non-performing assets

$

24,356

$

29,226

$

29,104

$

31,931

$

25,880

Total non-performing assets to total assets

0.68

%

0.87

%

0.79

%

0.88

%

0.70

%

Total non-performing loans to total loans held for investment 2

1.30

%

1.59

%

1.61

%

1.70

%

1.41

%

Allowance for loan losses to non-performing loans 2

81.00

%

67.25

%

66.36

%

70.63

%

85.25

%

Allowance for loan losses to total loans held for investment 2

1.05

%

1.07

%

1.07

%

1.20

%

1.20

%

Allowance for loan losses to total loans held for investment excluding acquired loans 3

1.15

%

1.19

%

1.23

%

1.41

%

1.47

%

Troubled debt restructured loans ("TDRs"):

Performing TDRs:

Commercial real estate

$

$

3,372

$

3,384

$

3,087

$

3,087

Commercial and industrial

196

202

207

213

20

Consumer real estate

748

963

558

788

543

Other consumer loans

54

62

67

88

107

  Total performing TDRs

$

998

$

4,599

$

4,216

$

4,176

$

3,757

Non-performing TDRs:4

Commercial real estate

$

8,344

$

11,786

$

11,218

$

8,849

$

8,952

Commercial and industrial

75

71

102

105

281

Consumer real estate

2,215

2,018

2,235

1,943

1,178

Other consumer loans

317

261

205

88

  Total non-performing TDRs

$

10,951

$

14,136

$

13,760

$

10,985

$

10,411

Allowance for loan losses:

Balance at beginning of period

$

18,642

$

18,051

$

19,835

$

19,229

$

18,023

Provision expense (benefit)

1,858

883

(17)

814

1,447

Charge-offs

(1,394)

(476)

(1,936)

(412)

(358)

Recoveries

171

184

169

204

117

  Balance at end of period

$

19,277

$

18,642

$

18,051

$

19,835

$

19,229

Net charge-offs (recoveries)

Commercial real estate

$

716

$

87

$

185

$

2

$

Commercial and industrial

64

172

893

(31)

10

Consumer real estate

320

23

437

94

120

Other consumer loans

123

10

252

143

111

Total net charge-offs

$

1,223

$

292

$

1,767

$

208

$

241

1 Loans held for sale at June 30, 2012 included loans originated by ViewPoint Mortgage.

2 Reflects the impact of loans acquired in the Highlands acquisition, which were initially recorded at fair value, with no allocated allowance for loan losses.

3 Excludes loans acquired from Highlands, which were initially recorded at fair value.

4 Non-performing TDRs are included in the non-performing assets above.

 

 

 

VIEWPOINT FINANCIAL GROUP, INC. Average Balances and Yields/Rates (unaudited)

For the Quarters Ended

June 30, 2013

March 31, 2013

December 31, 2012

September 30, 2012

June 30, 2012

Loans:

(Dollars in thousands)

Commercial real estate

$

961,631

$

839,155

$

805,362

$

762,521

$

724,775

Commercial and industrial loans:

Commercial

288,481

257,510

251,447

183,870

169,567

Warehouse lines of credit

27,670

26,037

26,072

22,639

16,013

Consumer real estate

476,226

504,965

524,213

550,341

575,791

Other consumer loans

53,759

57,164

60,435

63,142

62,192

Loans held for sale 1

755,577

738,234

908,603

886,743

681,095

Less: deferred fees and allowance for loan loss

(18,649)

(17,240)

(19,326)

(19,113)

(17,803)

Loans receivable

2,544,695

2,405,825

2,556,806

2,450,143

2,211,630

Securities

680,931

674,109

734,598

914,818

976,611

Overnight deposits

45,810

54,096

50,556

49,740

33,241

Total interest-earning assets

$

3,271,436

$

3,134,030

$

3,341,960

$

3,414,701

$

3,221,482

Deposits:

Interest-bearing demand

$

459,433

$

465,385

$

463,465

$

474,342

$

505,569

Savings and money market

883,507

877,690

888,410

894,916

892,844

Time

451,110

450,071

469,772

476,666

529,928

FHLB advances and other borrowings

679,693

590,238

770,627

863,949

626,055

Total interest-bearing liabilities

$

2,473,743

$

2,383,384

$

2,592,274

$

2,709,873

$

2,554,396

Total assets

$

3,453,699

$

3,322,899

$

3,529,665

$

3,607,101

$

3,427,807

Non-interest-bearing demand deposits

393,815

367,217

358,707

338,074

316,237

Total deposits

2,187,865

2,160,363

2,180,354

2,183,998

2,244,578

Total shareholders' equity

532,897

527,958

520,684

513,431

504,596

Yields/Rates:

Commercial real estate

5.85

%

5.88

%

6.17

%

6.44

%

6.41

%

Commercial and industrial loans:

Commercial

4.97

%

4.72

%

5.24

%

5.98

%

6.08

%

Warehouse lines of credit

3.57

%

3.63

%

3.71

%

3.82

%

3.31

%

Consumer real estate

5.16

%

5.30

%

5.48

%

5.40

%

5.54

%

Other consumer loans

5.94

%

5.84

%

6.00

%

6.03

%

6.43

%

Loans held for sale 1

3.87

%

3.92

%

4.05

%

4.11

%

4.10

%

Loans receivable

5.05

%

5.05

%

5.20

%

5.34

%

5.48

%

Securities

1.83

%

1.79

%

1.74

%

1.85

%

1.97

%

Overnight deposits

0.22

%

0.23

%

0.25

%

0.23

%

0.46

%

Total interest-earning assets

4.32

%

4.27

%

4.37

%

4.34

%

4.36

%

Deposits:

Interest-bearing demand

0.41

%

0.40

%

0.43

%

0.61

%

0.84

%

Savings and money market

0.27

%

0.27

%

0.27

%

0.27

%

0.29

%

Time

1.23

%

1.22

%

1.03

%

1.11

%

1.17

%

FHLB advances and other borrowings

1.42

%

1.67

%

1.37

%

1.27

%

1.72

%

Total interest-bearing liabilities

0.79

%

0.82

%

0.76

%

0.80

%

0.93

%

Net interest spread

3.53

%

3.45

%

3.61

%

3.54

%

3.43

%

Net interest margin

3.72

%

3.64

%

3.77

%

3.70

%

3.62

%

Cost of deposits (including non-interest-bearing demand)

0.45

%

0.45

%

0.43

%

0.49

%

0.58

%

1 Loans held for sale for the June 2012 period include loans originated by ViewPoint Mortgage.

 

 

VIEWPOINT FINANCIAL GROUP, INC. Supplemental Information- Non-GAAP Financial Measures (unaudited)

Ending Balances At

June 30, 2013

March 31, 2013

December 31, 2012

September 30, 2012

June 30, 2012

Calculation of Tangible Book Value per Share:

(Dollars in thousands, except share and per share amounts)

Total shareholders' equity

$

533,434

$

530,967

$

520,871

$

516,353

$

505,575

Less:  Goodwill

(29,650)

(29,650)

(29,650)

(29,650)

(29,203)

Identifiable intangible assets, net

(1,446)

(1,541)

(1,653)

(1,793)

(1,949)

Total tangible shareholders' equity

$

502,338

$

499,776

$

489,568

$

484,910

$

474,423

Shares outstanding at end of period

39,926,716

39,948,031

39,612,911

39,579,667

39,344,167

Book value per share- GAAP

$

13.36

$

13.29

$

13.15

$

13.05

$

12.85

Tangible book value per share- Non-GAAP

$

12.58

$

12.51

$

12.36

$

12.25

$

12.06

Calculation of Tangible Equity to Tangible Assets:

Total assets

$

3,594,484

$

3,373,636

$

3,663,058

$

3,636,033

$

3,692,856

Less:  Goodwill

(29,650)

(29,650)

(29,650)

(29,650)

(29,203)

Identifiable intangible assets, net

(1,446)

(1,541)

(1,653)

(1,793)

(1,949)

Total tangible assets

$

3,563,388

$

3,342,445

$

3,631,755

$

3,604,590

$

3,661,704

Equity to assets- GAAP

14.84

%

15.74

%

14.22

%

14.20

%

13.69

%

Tangible common equity to tangible assets- Non-GAAP

14.10

%

14.95

%

13.48

%

13.45

%

12.96

%

 

 

SOURCE ViewPoint Financial Group, Inc.