Intervest Bancshares (NASDAQ:IBCA)
Historical Stock Chart
5 Years : From May 2008 to May 2013
Intervest Bancshares Corporation (NASDAQ-GS: IBCA) (the "Company") today
reported net earnings for the third quarter of 2009 ("Q3-09") of $0.3
million, or $0.04 per diluted common share, compared to $2.6 million, or
$0.32 per share, for the third quarter of 2008 ("Q3-08"). The decrease
in net earnings was due a $2.1 million increase in noninterest expenses,
a $2.2 million decrease in noninterest income and $0.4 million of
dividend requirements related to outstanding preferred stock held by the
U.S. Treasury under the TARP program. The aggregate of these items was
partially offset by a $1.4 million decrease in the provision for income
tax expense and a $1.0 million decrease in the provision for loan losses.
Noninterest expenses increased to $7.4 million in Q3-09 from $5.3
million in Q3-08 primarily due to a $0.8 million (204%) increase in FDIC
insurance premiums due to higher rates for all FDIC insured banks, a
$0.6 million increase in expenses associated with nonperforming assets
resulting from $0.9 million related to one property that is not expected
to recur, a $0.4 million increase in expense from the early retirement
of higher-cost, fixed-rate debentures and a $0.2 million increase in
compensation and benefits expense. The Company had 72 employees at
September 30, 2009, compared to 70 at September 30, 2008.
Noninterest income decreased to $0.1 million in Q3-09 from $2.3 million
in Q3-08 primarily due to a $0.9 million decrease in income from early
repayment of loans, a $0.5 million decrease in deposit and loan service
charge income and a $0.7 million impairment charge on trust preferred
security investments due to the underlying collateral of these
securities experiencing decreased interest payments.
Net interest and dividend income remained relatively unchanged at $11.0
million in Q3-09, compared to $11.1 million in Q3-08, as a lower net
interest margin (1.86% in Q3-09 compared to 2.04% in Q3-08) was largely
offset by a $23 million increase in net interest earning assets from the
investment of TARP proceeds. The margin decreased primarily due to calls
of $428 million of higher yielding U.S. government agency security
investments (coupled with the reinvestment of the proceeds at lower
market rates of 91 basis points) and a higher level ($1.3 million) of
interest income not recorded on nonaccrual loans. These factors were
partially offset by lower rates paid for deposits and adjustable-rate
borrowings as well as the early retirement of all of the Company's
higher cost debentures. The yield on interest-earning assets decreased
by 92 basis points to 5.24% in Q3-09, while the cost of funds decreased
by 82 basis points to 3.75% in Q3-09.
The provision for loan losses decreased to $2.4 million in Q3-09, from
$3.4 million in Q3-08. The decrease was largely a function of the full
repayment of an $11.3 million impaired loan whose specific valuation
allowance of $1.7 million was no longer required. The Company continues
to be negatively impacted by the weak economy, increased vacancy rates
and lower real estate values, all of which have resulted in a higher
level of nonperforming assets. The Company's effective income tax rate
was 46% in Q3-09, compared to 44% in Q3-08.
Net earnings for the nine-months ended September 30, 2009 decreased by
$5.6 million from the same period of 2008 due to a $6.8 million increase
in noninterest expenses, a $4.2 million decrease in noninterest income
and $1.2 million of preferred stock dividend requirements, partially
offset by a $3.6 million decrease in the provision for income taxes, a
$1.5 million increase in net interest and dividend income and a $1.5
million decrease in the provision for loan losses.
Total assets at September 30, 2009 were $2.38 billion, compared to $2.27
billion at December 31, 2008, reflecting an increase in security
investments and foreclosed real estate, partially offset by a decrease
in overnight investments and loans receivable. Securities held to
maturity increased by $122 million to $598 million at September 30, 2009
and the portfolio had a weighted-average remaining contractual maturity
and a yield of 4.6 years and 2.86%, respectively. The Company has never
invested in CDOs, CMOs or stock of FNMA or FHLMC.
Total loans receivable, net of unearned fees, amounted to $1.70 billion
at September 30, 2009, a $10 million decrease from $1.71 billion at
December 31, 2008. The decrease was due to the aggregate of $143 million
of principal repayments, $27.2 million of loans transferred to
foreclosed real estate and $4.9 million of loan chargeoffs exceeding
$165 million of new loan originations, primarily secured by commercial
real estate. The originations were nearly all fixed-rate with a
weighted-average yield and term of 6.71% and 5.1 years, respectively.
New loan originations for the first nine-months of 2008 amounted to $327
million. The lower level of originations this year reflects a decrease
in suitable lending opportunities for the Company.
Total nonperforming assets at September 30, 2009 amounted to $164.6
million, or 6.91% of total assets, compared $148.0 million, or 6.22% of
total assets at June 30, 2009 and $117.7 million, or 5.18%, at December
31, 2008. At September 30, 2009, nonperforming assets were comprised of
$131.7 million of nonaccrual loans, or 38 loans, and $32.9 million of
real estate acquired through foreclosure, or 9 properties. At September
30, 2009, the Company also had $71.2 million of accruing restructured
loans on which the Company has granted certain concessions to provide
payment relief generally consisting of the deferral of principal
payments and/or a partial reduction in interest payments for a period of
time.
The Company is taking various steps to resolve its nonaccrual loans,
including proceeding with foreclosures on many of the collateral
properties, working with certain borrowers to provide payment relief
and, in limited cases, accepting partial payment as full satisfaction of
a nonaccrual loan. In Q3-09, nonperforming assets with an original
carrying value of $23.3 million were repaid or sold for total proceeds
of $22.8 million. The Company believes that concentrating its effort
towards the individual collection of nonaccrual loans either through the
restructure of certain loans or through the acquisition and eventual
sale of the collateral properties will in most cases maximize the
recovery of its investment. The ability to complete foreclosure or other
proceedings to acquire and sell certain collateral properties however
continues to be delayed by various factors including bankruptcy
proceedings and an overloaded court system. As a result of these delays,
the timing and amount of the resolution/disposition of nonaccrual loans
as well as foreclosed real estate cannot be predicted with certainty. In
addition, if the current downturn in commercial real estate values and
local economic conditions in both New York and Florida as well as other
factors noted above continue for an additional extended period, it could
have an adverse impact on the Company's future asset quality and level
of nonperforming assets, charge offs and profitability. There can be no
assurance that the Company will not have significant additional loan
loss provisions or expenses in connection with the ultimate collection
of nonaccrual loans or in carrying and disposing of foreclosed real
estate. The Company does not own or originate construction/development
loans or condominium conversion loans.
The total allowance for loan losses increased to $31.8 million at
September 30, 2009, from $28.5 million at December 31, 2008, due to $6.9
million of loan loss provisions and a $1.3 million partial recovery of a
prior chargeoff, partially offset by $4.9 million of new chargeoffs. The
allowance represented 1.88% of total loans (net of deferred fees) at
September 30, 2009, compared to 1.67% at December 31, 2008. At each
date, a SFAS No. 114 specific valuation allowance (included as part of
the overall allowance for loan losses) in the aggregate amount of $13.5
million and $8.2 million, respectively, was maintained on nonaccrual and
restructured loans.
Total deposits at September 30, 2009 increased to $2.01 billion, from
$1.86 billion at December 31, 2008, reflecting an increase of $140
million in money market accounts and a $6 million increase in interest
checking and savings deposit accounts. Total borrowed funds and related
interest payable at September 30, 2009 decreased to $107 million, from
$149 million at December 31, 2008, reflecting the early repayment of $40
million of higher cost debentures. Total stockholders' equity at
September 30, 2009 increased to $213.6 million, from $212.0 million at
December 31, 2008 primarily due to net earnings of $1.2 million for the
period. At September 30, 2009, Intervest National Bank's regulatory
capital ratios were as follows: total capital to risk-weighted assets -
13.96%, Tier 1 capital to risk-weighted assets - 12.71% and Tier 1
capital to total average assets (leverage ratio) - 10.22%.
Intervest Bancshares Corporation is a holding company. Its principal
operating subsidiary is Intervest National Bank, a nationally chartered
commercial bank that has its headquarters and full-service banking
office at One Rockefeller Plaza, in New York City, and a total of six
full-service banking offices in Clearwater and Gulfport, Florida.
Intervest National Bank maintains capital ratios in excess of the
regulatory requirements to be designated as a well-capitalized
institution. Intervest Bancshares Corporation's Class A Common Stock is
listed on the NASDAQ Global Select Market: Trading Symbol IBCA. This
press release may contain forward-looking information. Except for
historical information, the matters discussed herein are subject to
certain risks and uncertainties that may affect the Company's actual
results of operations. The following important factors, among others,
could cause actual results to differ materially from those set forth in
forward looking statements: changes in general economic conditions and
real estate values in the Company's market areas; changes in policies by
regulatory agencies; fluctuations in interest rates; demand for loans
and deposits; and competition. Reference is made to the Company's
filings with the SEC for further discussion of risks and uncertainties
regarding the Company's business. Historical results are not necessarily
indicative of the future prospects of the Company.
Selected Consolidated Financial Information Follows.
INTERVEST BANCSHARES CORPORATION
Selected Consolidated Financial Information
(Dollars in thousands, except per share amounts)
Quarter Ended
Nine-Months Ended
September 30,
September 30,
Selected Operating Data:
2009
2008
2009
2008
Interest and dividend income
$
30,939
$
33,508
$
92,422
$
97,072
Interest expense
19,924
22,424
61,920
68,069
Net interest and dividend income
11,015
11,084
30,502
29,003
Provision for loan losses
2,396
3,446
6,939
8,462
Net interest and dividend income after provision for loan losses
8,619
7,638
23,563
20,541
Noninterest income
95
2,318
225
4,400
Noninterest expenses
7,336
5,276
19,829
12,991
Earnings before income taxes
1,378
4,680
3,959
11,950
Provision for income taxes
627
2,054
1,535
5,182
Net earnings before preferred dividend requirements
751
2,626
2,424
6,768
Preferred dividend requirements (1)
409
-
1,223
-
Net earnings available to common stockholders
$
342
$
2,626
$
1,201
$
6,768
Basic earnings per common share
$
0.04
$
0.32
$
0.14
$
0.82
Diluted earnings per common share
0.04
0.32
0.14
0.82
Cash dividends paid per common share
-
-
-
0.25
Average common shares used to calculate:
Basic earnings per common share
8,270,812
8,270,812
8,270,812
8,255,155
Diluted earnings per common share (2)
8,270,812
8,270,812
8,270,812
8,257,204
Common shares outstanding at end of period
8,270,812
8,270,812
8,270,812
8,270,812
Common stock options/warrants outstanding at end of period
952,012
132,040
952,012
132,040
Yield on interest-earning assets
5.24
%
6.16
%
5.35
%
6.08
%
Cost of funds
3.75
%
4.57
%
3.99
%
4.73
%
Net interest margin (3)
1.86
%
2.04
%
1.76
%
1.82
%
Return on average assets (annualized)
0.13
%
0.48
%
0.14
%
0.42
%
Return on average common equity (annualized)
1.58
%
5.69
%
1.71
%
4.92
%
Effective income tax rate
45.50
%
43.89
%
38.77
%
43.36
%
Efficiency ratio (4)
45
%
25
%
50
%
30
%
Total average loans outstanding
$
1,734,983
$
1,720,596
$
1,729,587
$
1,689,846
Total average securities outstanding
601,338
437,463
567,717
422,457
Total average short-term investments outstanding
7,071
5,642
13,498
20,961
Total average interest-earning assets outstanding
2,343,392
2,163,701
2,310,802
2,133,264
Total average assets outstanding
2,378,372
2,188,594
2,340,197
2,154,650
Total average interest-bearing deposits outstanding
$
1,997,690
$
1,775,307
$
1,953,302
$
1,766,829
Total average borrowings outstanding
111,247
177,270
121,156
154,456
Total average interest-bearing liabilities outstanding
2,108,937
1,952,577
2,074,458
1,921,285
Total average stockholders' equity
213,003
184,496
212,635
183,561
At Sep 30,
At Jun 30,
At Mar 31,
At Dec 31,
At Sep 30,
Selected Financial Condition Information:
2009
2009
2009
2008
2008
Total assets
$
2,382,170
$
2,380,044
$
2,317,613
$
2,271,833
$
2,180,746
Total cash and short-term investments
30,660
23,441
30,203
54,903
21,969
Total securities held to maturity
598,313
566,722
544,702
475,581
410,844
Total FRB and FHLB stock
9,929
9,929
9,657
8,901
10,912
Total loans, net of unearned fees
1,696,064
1,746,087
1,708,752
1,705,711
1,691,851
Total deposits
2,012,995
1,995,165
1,938,123
1,864,135
1,734,820
Total borrowed funds and accrued interest payable
107,547
118,035
122,194
149,566
210,551
Total preferred equity
23,370
23,273
23,177
23,080
-
Total common equity
190,249
189,864
189,440
188,894
186,230
Book value per common share
23.00
22.96
22.90
22.84
22.52
Total allowance for loan losses
$
31,815
$
32,054
$
30,371
$
28,524
$
25,828
Total loan recoveries for the quarter
-
1,329
-
-
-
Total loan chargeoffs for the quarter
2,635
2,332
10
-
4,227
Total accruing troubled debt restructurings (5)
71,156
76,210
30,586
-
-
Total loans ninety days past due and still accruing.
1,947
6,367
1,958
1,964
-
Total nonaccrual loans
131,742
129,784
119,305
108,610
82,759
Total foreclosed real estate
32,915
18,214
9,742
9,081
25,099
Allowance for loan losses/net loans
1.88
%
1.84
%
1.78
%
1.67
%
1.53
%
(1)
Represents accrued dividends on $25 million of 5% cumulative
preferred stock held by the U.S. Treasury and amortization of
related preferred stock discount.
(2)
Diluted EPS includes shares that would be outstanding if dilutive
common stock options/warrants were assumed to be exercised during
the period. Outstanding options/warrants are dilutive when their
exercise price is above the average market price of the Class A
common stock during the reporting periods.
(3)
Net interest margin is reported exclusive of income from loan
prepayments, which is included as a component of noninterest income.
(4)
Represents noninterest expenses (excluding provision for loan losses
& real estate expenses) as a percentage of net interest and dividend
income plus noninterest income.
(5)
Represent loans whose terms have been modified mostly through the
deferral of principal and/or a partial reduction in interest
payments.
INTERVEST BANCSHARES CORPORATION
Consolidated Financial Highlights
At or For The Period Ended
($ in thousands, except per share amounts)
Nine-Months
Ended
Sep 30,
2009
Year
Ended
Dec 31,
2008
Year
Ended
Dec 31,
2007
Year
Ended
Dec 31,
2006
Year
Ended
Dec 31,
2005
Balance Sheet Highlights:
Total assets
$
2,382,170
$
2,271,833
$
2,021,392
$
1,971,753
$
1,706,423
Asset growth rate
5
%
12
%
3
%
16
%
30
%
Total loans, net of unearned fees
1,696,064
1,705,711
1,614,032
1,490,653
1,367,986
Loan growth rate
-1
%
6
%
8
%
9
%
35
%
Total deposits
2,012,995
1,864,135
1,659,174
1,588,534
1,375,330
Deposit growth rate
8
%
12
%
4
%
16
%
38
%
Loans/deposits (Intervest National Bank)
80
%
85
%
88
%
84
%
88
%
Total borrowed funds and accrued interest payable.
107,547
149,566
136,434
172,909
155,725
Preferred equity
23,370
23,080
-
-
-
Common equity
190,249
188,894
179,561
170,046
136,178
Common book value per share
23.00
22.84
22.23
20.31
17.41
Market price per common share
3.53
3.99
17.22
34.41
24.04
Asset Quality Highlights
Nonaccrual loans
$
131,742
$
108,610
$
90,756
$
3,274
$
750
Foreclosed real estate
32,915
9,081
-
-
-
Accruing troubled debt restructurings (1)
71,156
-
-
-
-
Loans ninety days past due and still accruing
1,947
1,964
11,853
-
2,649
Allowance for loan losses
31,815
28,524
21,593
17,833
15,181
Loan recoveries
1,329
-
-
-
-
Loan chargeoffs
4,977
4,227
-
-
-
Allowance for loan losses/net loans
1.88
%
1.67
%
1.34
%
1.20
%
1.11
%
Statement of Operations Highlights:
Interest and dividend income
$
92,422
$
128,497
$
131,916
$
128,605
$
97,881
Interest expense
61,920
90,335
89,653
78,297
57,447
Net interest and dividend income
30,502
38,162
42,263
50,308
40,434
Provision for loan losses
6,939
11,158
3,760
2,652
4,075
Noninterest income
225
5,026
8,825
6,855
6,594
Noninterest expenses
19,829
18,873
12,876
13,027
10,703
Earnings before income taxes
3,959
13,157
34,452
41,484
32,250
Provision for income taxes
1,535
5,891
15,012
17,953
14,066
Net earnings before preferred dividend requirements
2,424
7,266
19,440
23,531
18,184
Preferred dividend requirements (2)
1,223
41
-
-
-
Net earnings available to common stockholders
$
1,201
$
7,225
$
19,440
$
23,531
$
18,184
Basic earnings per common share
$
0.14
$
0.87
$
2.35
$
2.98
$
2.65
Diluted earnings per common share
$
0.14
$
0.87
$
2.31
$
2.82
$
2.47
Adjusted net earnings used to calculate
diluted earnings per common share
$
1,201
$
7,225
$
19,484
$
23,679
$
18,399
Average common shares used to calculate:
Basic earnings per common share
8,270,812
8,259,091
8,275,539
7,893,489
6,861,887
Diluted earnings per common share
8,270,812
8,267,781
8,422,017
8,401,379
7,449,658
Common shares outstanding
8,270,812
8,270,812
8,075,812
8,371,595
7,823,058
Net interest margin (3)
1.76
%
1.79
%
2.11
%
2.75
%
2.70
%
Return on average assets
0.14
%
0.34
%
0.96
%
1.28
%
1.20
%
Return on average common equity
1.71
%
3.94
%
11.05
%
15.82
%
16.91
%
Effective income tax rate
38.77
%
44.77
%
43.57
%
43.28
%
43.62
%
Efficiency ratio (4)
50
%
33
%
24
%
23
%
23
%
Full-service banking offices
7
7
7
7
6
(1)
Represent loans whose terms have been modified mostly through the
deferral of principal and/or a partial reduction in interest
payments.
(2)
Represents accrued dividends on $25 million of 5% cumulative
preferred stock held by the U.S. Treasury and amortization of
related preferred stock discount.
(3)
Net interest margin is reported exclusive of income from loan
prepayments, which is included as a component of noninterest income.
Inclusive of such income, the margin would compute to 1.81% for the
nine-months ended Sep 30, 2009, 1.95% for 2008, 2.57% for 2007,
3.11% for 2006 and 2.94% for 2005.
(4)
Represents noninterest expenses (excluding provision for loan losses
and real estate expenses) as a percentage of net interest and
dividend income plus noninterest income. Noninterest expenses for
2006 included a one-time charge of $1.5 million.
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