1st United Bancorp, Inc. Announces Fourth Quarter Earnings
BOCA RATON, Fla., Feb. 18 /PRNewswire-FirstCall/ -- (Nasdaq Global: FUBC) -- 1st United Bancorp, Inc. ("1st United") reported net income of $6.4 million for the quarter ended December 31, 2009 compared to a loss of $998,000 for the quarter ended December 31, 2008. 1st United reported net income of $4.720 million for the year ended December 31, 2009 compared to a net loss of $1.359 million for the year ended December 31, 2008.
After giving effect to preferred stock dividends, 1st United reported basic and diluted earnings (loss) per share available to common stock shareholders of $0.25 and ($0.15) for the three months ended December 31, 2009 and 2008, respectively, and $0.30 and ($0.25) for the years ended December 31, 2009 and 2008, respectively.
Highlights for the quarter and the year ended December 31, 2009:
Acquisition of Republic Federal Bank from the Federal Deposit Insurance Corporation as Receiver
On December 11, 2009, 1st United Bank, 1st United's wholly-owned subsidiary, acquired substantially all the deposits and certain assets of Republic Federal Bank, N.A. ("Republic") through a purchase and assumption agreement ("Republic Agreement") with the Federal Deposit Insurance Corporation ("FDIC"). The fair value of the deposits assumed was $349.6 million, and the fair value of the acquired loans was $198.6 million and acquired cash and investments was $58.7 million. The FDIC paid 1st United Bank approximately $158 million which included a negative net bid of $34.2 million. 1st United recorded a gain on this purchase of $23.3 million for the quarter and year ended December 31, 2009.
Republic operated four banking centers in Miami-Dade County, Florida, and had approximately 100 employees.
The acquired loans are covered by two loss share agreements (the "Loss Share Agreements") between the FDIC and 1st United Bank, which affords 1st United Bank significant loss protection. Under the Loss Share Agreements, the FDIC will cover 80% of covered loan and foreclosed real estate losses up to $36 million and 95% of losses in excess of that amount. The Loss Share Agreements also cover third party collection costs and 90 days of accrued interest on covered assets. The term for loss sharing on residential real estate loans is ten years, while the term for loss sharing on non-residential real estate loans is five years with respect to losses and eight years with respect to loss recoveries. The reimbursable losses from the FDIC are based on the book value of the relevant loan as determined by the FDIC at the date of the transaction. New loans made after that date are not covered by the Loss Share Agreements.
Financial Condition
- Total assets at December 31, 2009 were $1.015 billion, an increase of approximately $397 million over the total assets at December 31, 2008 of $617.8 million.
- On September 22, 2009, 1st United completed a $70 million common stock offering and listed its common stock on the NASDAQ Global Stock Market under the symbol FUBC. On October 6, 2009, the underwriters exercised their over-allotment option and 1st United received an additional $10.5 million in gross proceeds. Total gross proceeds from the offering were approximately $80.5 million.
- The allowance for loan losses at December 31, 2009 was $13.3 million (1.95% of total loans) and 69% of non-accrual loans (88% of non-accrual loans are not covered by the Loss Share Agreements). This compares to an allowance for loan losses at December 31, 2008 of $5.8 million (1.2% of total loans) and 68% of non-accrual loans.
- Non-performing assets (non-accruing loans, loans accruing >= 90 days and other real estate owned) to total assets were 1.97% at December 31, 2009. This compares to non-performing assets of 1.72% at December 31, 2008.
- Total risk-based capital ratio, Tier 1 capital ratio, and leverage ratio at December 31, 2009 were 25.8%, 23.5% and 17.3%, respectively.
Operating Results
- Net income of $6.4 million for the quarter ended December 31, 2009 and net income of $4.7 million for the year ended December 31, 2009 were impacted by:
- Gain on the Republic transaction of $23.3 million during the quarter
- Provision for loan losses of $10.2 million for the quarter
- Net Interest Margin of 3.48% for the quarter ended December 31, 2009 and 3.69% for the year ended December 31, 2009
- Acquisition related expenses of approximately $2.7 million during the quarter and year ended December 31, 2009
Management Comments:
"With the ongoing economic situation in 2009, we saw both challenges and opportunities," said Warren Orlando, Chairman. "We were excited to complete our initial public offering during the year and raise new capital of approximately $75 million net of costs, as well as acquiring the $350 million in assets of Republic Federal Bank, N. A. from the Federal Deposit Insurance Corporation on December 11, 2009. We are now over $1 billion in assets with a very strong capital base that will allow us to continue to expand and take advantage of future opportunities."
"The Republic Federal integration is going very well. The employees of our new Dade County banking centers are doing an extraordinary job in serving and maintaining their customers," said Rudy E. Schupp, Chief Executive Officer. "Our core business also remains strong and for the most part our customers continue to weather this economic storm. We have the desire, people, liquidity, capital and financial strength to continue to make quality loans in the communities we serve, including our expanded market."
"Our non-performing assets to total assets at the end of the year was a relatively low 1.97%, although we continue to provide significant loan reserves to cover the challenges of appraisals, and the ongoing weakness in our local economies," said John Marino, President and Chief Financial Officer. "We remain vigilant and aggressive in monitoring asset quality and will continue to act quickly to resolve problem assets as they are identified."
Forward Looking Statements
Any non-historical statements in this press release are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are based on current plans and expectations that are subject to uncertainties and risks, which could cause 1st United's future results to differ materially. The following factors, among others, could cause our actual results to differ: 1st United's ability to execute its growth strategy, risks relating to the integration of acquired companies that have previously been operated separately, challenges posed by the current economic environment, disruptions in global financial markets, credit risk of 1st United's customers, effects of the on-going correction in residential real estate prices and reduced levels of home sales, sufficiency of 1st United's allowance for loan losses, changes in interest rates, access to funding sources, reliance on the services of executive management, competition for loans, deposits and investment dollars, reputational risk and social factors, changes in government regulations and legislation, increases in FDIC insurance assessments, geographic concentration of 1st United's markets, rapid changes in the financial services industry, exposure to intangible asset risk, hurricanes and other adverse weather events, and 1st United's ability to manage the risks involved in the foregoing. Additional factors can be found in our filings with the SEC, which are available at the SEC's internet site (http://www.sec.gov). Forward-looking statements in this press release speak only as of the date of the press release, and 1st United assumes no obligation to update forward-looking statements or the reasons why actual results could differ.
Selected Financial Data December 31, December 31,
2009 2008
---- ----
(Amounts in thousands)
BALANCE SHEET DATA
Total assets $1,015,567 $617,821
Total loans 680,976 486,247
Allowance for loan losses 13,282 5,799
Cash and cash equivalents 135,241 19,102
Securities available for sale 88,843 35,075
Other real estate owned 635 -
Goodwill and other intangible assets 48,053 47,118
FDIC loss share receivable 32,900 -
Deposits 802,808 436,269
Non-interest bearing deposits 194,185 100,785
Stockholders' equity 172,294 98,870
SELECTED ASSET QUALITY DATA,
CAPITAL AND ASSET QUALITY RATIOS
Equity/assets 16.97% 16.00%
Non-accrual loans/total loans 2.84% 2.18%
Non-performing assets/total assets 1.97% 1.72%
Allowance for loan losses/total loans 1.95% 1.19%
Allowance for loan losses/non-accrual loans 69% 55%
Net charge-offs (recoveries)/average loans 1.14% 0.21%
Leverage Ratio 17.33% 8.15%
Tier 1 Risk Based Capital 23.54% 9.46%
Total Risk Based Capital 25.76% 11.69%
Income Statement Data
For the three For the year
month period ended ended
December 31, December 31,
------------ ------------
2009 2008 2009 2008
---- ---- ---- ----
(Amounts in thousands, except per share data)
Interest income $7,618 $7,501 $28,539 $30,250
Interest expense 1,743 2,327 7,246 9,584
------ ----- ------ -----
Net interest income 5,875 5,174 21,293 20,666
Provision for loan
losses 10,150 1,435 13,240 1,910
------ ----- ------ -----
Net interest income
after provision for
loan losses (4,275) 3,739 8,053 18,756
Gain on acquisition 23,292 - 23,292 -
Other Non interest
income 440 626 2,427 2,037
Non interest expense 9,249 5,898 26,168 22,904
------ ------ ----- ------
Income (loss) before
taxes 10,208 (1,533) 7,604 (2,111)
------ ------ ----- ------
Income expense (benefit) 3,805 (535) 2,884 (752)
Net income (loss) $6,403 $(998) $4,720 $(1,359)
------ ----- ------ -------
Preferred Stock
Dividends Earned $(277) $(287) $(774) $(368)
----- ----- ----- -----
Net income(loss)
available to common
Shareholders $6,126 $(1,285) $3,946 $(1,727)
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PER SHARE DATA
Basic and diluted
earnings (loss) per
share $0.25 $(0.15) $0.30 $(0.25)
Book value per common
share $6.95 $10.87 $6.95 $10.87
SELECTED OPERATING RATIOS
Return on average assets 3.38% 0.65% 0.60% (0.25%)
Return on average
stockholders' equity 14.86% (4.03%) 3.19% (1.63%)
Net interest margin 3.48% 3.83% 3.69% 4.23%
Average assets $758,520 $614,047 $653,068 $551,126
Average stockholders'
equity $172,302 $99,015 $123,863 $83,604
Outstanding common
stock 24,781,660 8,670,231 24,781,660 8,670.23
SOURCE 1st United Bancorp, Inc.
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