Intervest Bancshares (NASDAQ:IBCA)
Historical Stock Chart
3 Years : From May 2010 to May 2013
Intervest Bancshares Corporation (NASDAQ-GS: IBCA), parent company of
Intervest National Bank, today reported its financial results for the
fourth quarter of 2010.
Financial Highlights:
-
Net earnings for the fourth quarter of 2010 ("Q4-10") amounted to $0.4
million, or $0.02 per diluted common share, compared to a net loss of
$0.7 million, or $0.07 per share, for the third quarter of 2010
("Q3-10"), and net earnings of $0.3 million, or $0.04 per share, for
the same quarter a year ago ("Q4-09").
-
Pre-tax earnings before deducting provisions for loan and real estate
losses and real estate expenses amounted to $6.6 million in Q4-10,
compared to $4.9 million in Q3-10 and $7.8 million in Q4-09.
-
Net interest margin for Q4-10 was 2.06%, compared to 1.98% in Q3-10
and 2.04% in Q4-09.
-
Nonaccrual loans and real estate owned totaled $80 million at December
31, 2010, up only slightly from $77 million at September 30, 2010
despite one loan for $14 million being placed on nonaccrual status in
Q4-10, and down substantially from $156 million at December 31, 2009.
-
The allowance for loan losses increased to 2.61% of total outstanding
loans at December 31, 2010, up from 2.37% at September 30, 2010 and
1.94% at December 31, 2009.
-
The Company continued to control its non-interest expenses despite
substantial increases in FDIC deposit insurance premiums and
regulatory compliance costs. Inclusive of these higher costs,
noninterest expense amounted to $4.9 million in Q4-10, compared to
$5.2 million in Q3-10 and $4.4 million in Q4-09.
-
The Company completed the sale of common stock in a public offering in
Q4-10 that raised $21 million of new capital, most of which was down
streamed to Intervest National Bank to strengthen its capital. At
December 31, 2010, the Bank's regulatory capital ratios were well in
excess of its regulatory minimums and were as follows: total capital
to risk-weighted assets – 14.22%; Tier 1 capital to risk-weighted
assets – 12.96%; and Tier 1 capital to total average assets (leverage
ratio) – 9.61%. The Bank's regulatory minimum capital ratios are 12%,
10% and 9%, respectively.
-
Common book value per share was $7.61 at December 31, 2010.
Net earnings in Q4-10 increased by $0.1 million over Q4-09. The results
were favorably impacted by a $0.9 million decrease in real estate
expenses (due to a lower level of nonperforming assets), a $0.8 million
decrease in the total provision for loan and real estate losses
(reflecting a lower level of problem loans and credit rating
downgrades), and a $1.0 million increase in noninterest income (due to
$0.4 million of non-recurring fees and a $0.5 million decrease in
security impairment charges). The aggregate of these items was nearly
offset by a $1.7 million decrease in net interest and dividend income, a
$0.5 million increase in noninterest expenses (primarily due to higher
FDIC insurance premiums) and a $0.4 million increase in income tax
expense (primarily due to higher pre-tax income).
The decrease in net interest and dividend income reflected the impact of
the planned reduction in the size of the Company's balance sheet as well
as the sale of performing loans as part of a bulk sale in May 2010,
partially offset by an improved net interest margin as noted above. The
increased margin resulted from lower rates paid on deposits, largely
offset by calls of higher yielding U.S. government agency security
investments (coupled with the reinvestment of the proceeds into similar
securities with lower interest rates) and the sale of loans yielding
approximately 5%. The yield on average interest-earning assets decreased
by 36 basis points to 4.89% in Q4-10, from 5.25% in Q4-09, while the
average cost of funds decreased at a greater pace or by 51 basis points
to 3.03% in Q4-10, from 3.54% in Q4-09.
For the full year 2010, the Company had a net loss of $55.0 million, or
$4.95 per diluted common share, compared to net earnings of $1.5
million, or $0.18 per share, for 2009. The net loss for 2010 was driven
primarily by a bulk sale of assets and additional loan and real estate
loss provisions due to declining commercial real estate values and
continued weakness in the economy. As previously reported, in May 2010,
the Company sold in bulk certain nonperforming and underperforming loans
(including restructured loans or TDRs) aggregating to $192.6 million and
other real estate owned of $14.4 million. The assets were sold at a
substantial discount to their net carrying values for a total purchase
price of $121.5 million. The transaction contributed approximately $44
million to the net loss. The Company recorded a $34 million deferred tax
asset related to this transaction.
Total assets at December 31, 2010 decreased to $2.07 billion from $2.40
billion at December 31, 2009, primarily reflecting a decrease in loans
receivable and security investments, partially offset by an increase in
the deferred tax asset and overnight investments.
Total loans receivable, net of unearned fees, amounted to $1.33 billion
at December 31, 2010, a $349 million decrease from $1.68 billion at
December 31, 2009. The decrease was due to an aggregate of $286 million
of principal repayments (resulting from the bulk sale of loans, other
loan payoffs and normal amortization), $41 million of loans transferred
to real estate owned and $100 million of loan chargeoffs (which included
approximately $80 million of chargeoffs related to the bulk sale),
partially offset by $77 million of new loan originations. The Company
does not own or originate construction/development loans.
Total nonaccrual loans and real estate owned aggregated $80 million, or
3.9% of total assets, at December 31, 2010, compared to $77 million, or
3.7%, at September 30, 2010 and $156 million, or 6.5%, at December 31,
2009. The decrease in the size of the loan portfolio during 2010
negatively impacted the percentages. Nonaccrual loans at September 30,
2010 and December 31, 2010 also included $21 million of performing TDRs
that are classified as nonaccrual based on regulatory guidance. These
TDRs continue to pay as agreed under their renegotiated terms.
The allowance for loan losses at December 31, 2010 was $34.8 million,
representing 2.61% of total net loans, compared to $32.3 million, or
2.37%, at September 30, 2010 and $32.6 million, or 1.94%, at December
31, 2009. The overall allowance included specific reserves for impaired
loans (comprised of nonaccrual loans and TDRs) at each date of $7.2
million, $4.0 million and $13.8 million, respectively.
Total securities held to maturity decreased by $20.5 million to $614.3
million at December 31, 2010 from $634.8 million at December 31, 2009,
primarily due to calls exceeding new purchases. The securities portfolio
is comprised mainly of U.S. government agency securities. At December
31, 2010, the Company had a net deferred tax asset totaling $47.1
million, of which $27 million related to an unused gross operating loss
carryforward of $61 million.
Total deposits at December 31, 2010 decreased to $1.77 billion from
$2.03 billion at December 31, 2009, reflecting a $204.7 million decrease
in time deposits and a $59.3 million decrease in money market deposit
accounts resulting from Intervest National Bank's planned shrinkage
through a reduction in its deposit rates. Total borrowed funds and
related interest payable at December 31, 2010 decreased to $85 million,
from $119 million at December 31, 2009, due to the maturity and
repayment of FHLBNY borrowings. Total stockholders' equity decreased to
$186 million at December 31, 2010 from $214 million at December 31,
2009, primarily due to the 2010 net loss before preferred dividend
requirements of $53.3 million, partially offset by the private placement
in May of 850,000 shares of common stock at $5 per share for net
proceeds of approximately $4.0 million and a public offering of common
stock in October of 11,686,377 shares at $1.95 per share for net
proceeds of approximately $21.0 million.
Intervest Bancshares Corporation is a bank 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 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. Words such as "may," "will,"
"could," "should," "would," "believe," "anticipate," "estimate,"
"expect," "intend," "plan," "project," "assume," "indicate," "continue,"
"target," "goal," and similar words or expressions of the future are
intended to identify forward-looking statements. 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 regulatory
policies and enforcement actions; fluctuations in interest rates; demand
for loans and deposits; changes in tax laws or the availability of net
operating losses, the effects of additional capital, the availability of
regulatory waivers; 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
Year Ended
December 31,
December 31,
Selected Operating Data:
2010
2009
2010
2009
Interest and dividend income
$
24,747
$
31,176
$
107,072
$
123,598
Interest expense
14,307
19,080
62,692
81,000
Net interest and dividend income
10,440
12,096
44,380
42,598
Provision for loan losses
2,693
3,926
101,463
10,865
Noninterest income
1,073
72
2,110
297
Noninterest expenses:
Provision for real estate losses
2,004
1,587
15,509
2,275
Real estate expenses
343
1,259
4,105
4,945
All other noninterest expenses
4,887
4,409
19,069
19,864
Earnings (loss) before income taxes
1,586
987
(93,656)
4,946
Provision (benefit) for income taxes
727
281
(40,348)
1,816
Net earnings (loss) before preferred dividend requirements
859
706
(53,308)
3,130
Preferred dividend requirements (1)
422
409
1,667
1,632
Net earnings (loss) available to common stockholders
$
437
$
297
$
(54,975)
$
1,498
Basic earnings (loss) per common share
$
0.02
$
0.04
$
(4.95)
$
0.18
Diluted earnings (loss) per common share
$
0.02
$
0.04
$
(4.95)
$
0.18
Average common shares used to calculate:
Basic and diluted earnings (loss) per common share (2)
18,308,205
8,270,812
11,101,196
8,270,812
Common shares outstanding at end of period
21,126,489
8,270,812
21,126,489
8,270,812
Common stock options/warrants outstanding at end of period
1,045,422
1,019,722
1,045,422
1,019,722
Yield on interest-earning assets
4.89%
5.25%
5.08%
5.32%
Cost of funds
3.03%
3.54%
3.20%
3.87%
Net interest margin (3)
2.06%
2.04%
2.11%
1.83%
Return on average assets (annualized)
0.16%
0.12%
-2.42%
0.13%
Return on average common equity (annualized)
2.19%
1.49%
-32.20%
1.65%
Effective income tax rate
45.84%
28.47%
43.08%
36.72%
Efficiency ratio (4)
42%
36%
41%
46%
Total average loans outstanding
$
1,357,549
$
1,698,251
$
1,489,004
$
1,721,688
Total average securities outstanding
638,791
641,616
599,519
586,344
Total average short-term investments outstanding
11,170
17,652
18,502
14,544
Total average assets outstanding
2,102,186
2,408,538
2,200,436
2,357,422
Total average interest-bearing deposits outstanding
$
1,786,801
$
2,031,381
$
1,863,612
$
1,972,982
Total average borrowings outstanding
86,229
108,067
97,031
117,856
Total average stockholders' equity
180,857
213,595
189,197
212,877
At Dec 31,
At Sep 30,
At Jun 30,
At Mar 31,
At Dec 31,
Selected Financial Condition Information:
2010
2010
2010
2010
2009
Total assets
$
2,070,868
$
2,104,098
$
2,164,442
$
2,284,257
$
2,401,204
Total cash and short-term investments
23,911
13,815
35,535
56,470
7,977
Total securities held to maturity
614,335
613,844
621,244
491,067
634,856
Total loans, net of unearned fees
1,337,326
1,363,312
1,395,564
1,634,140
1,686,164
Total deposits
1,766,083
1,806,834
1,852,356
1,926,772
2,029,984
Total borrowed funds and accrued interest payable
84,676
89,135
98,582
103,060
118,552
Total preferred equity
23,852
23,755
23,659
23,563
23,466
Total common equity
162,108
140,317
140,643
187,711
190,588
Common book value per share (5)
7.61
15.26
15.33
22.69
23.04
Total allowance for loan losses
$
34,840
$
32,250
$
30,350
$
28,300
$
32,640
Allowance for loan losses/net loans
2.61%
2.37%
2.17%
1.73%
1.94%
Total loan recoveries for the quarter
283
600
-
-
25
Total loan chargeoffs for the quarter
386
298
85,483
13,979
3,126
Total real estate chargeoffs for the quarter
2,970
912
11,732
-
-
Total loans ninety days past due and still accruing (6)
$
7,481
$
16,865
$
8,788
$
3,629
$
6,800
Total accruing troubled debt restructured loans (7)
3,632
617
21,362
116,906
97,311
Total nonaccrual loans
52,923
38,560
18,927
96,248
123,877
Total real estate owned, net of valuation allowance
27,064
38,792
34,259
57,858
31,866
(1)
Represents dividend requirements on cumulative preferred stock held
by the U.S. Treasury and amortization of related preferred stock
discount.
(2)
Outstanding options/warrants were not dilutive for 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 real estate
losses & real estate expenses) as a percentage of net interest and
dividend income plus noninterest income.
(5)
Represents common stockholders' equity less preferred dividends in
arrears ($1.4 million at December 31, 2010 only) divided by common
shares outstanding.
(6)
At December 31, 2010, these were performing loans that were past
their contractual maturity date. Extensions for the majority at
market terms are pending.
(7)
Represent loans whose terms have been modified mostly through the
deferral of principal and/or a partial reduction in interest
payments.
INTERVEST BANCSHARES CORPORATION
Consolidated Financial Highlights
At or For The Period Ended
($ in thousands, except per share amounts)
YearEndedDec 31,2010
YearEndedDec 31,2009
YearEndedDec 31,2008
YearEndedDec 31,2007
YearEndedDec 31,2006
Balance Sheet Highlights:
Total assets
$
2,070,868
$
2,401,204
$
2,271,833
$
2,021,392
$
1,971,753
Total cash and short-term investments
23,911
7,977
54,903
33,086
40,195
Total securities held to maturity
614,335
634,856
475,581
344,105
404,015
Total loans, net of unearned fees
1,337,326
1,686,164
1,705,711
1,614,032
1,490,653
Total deposits
1,766,083
2,029,984
1,864,135
1,659,174
1,588,534
Total borrowed funds and accrued interest payable.
84,676
118,552
149,566
136,434
172,909
Preferred stockholder's equity
23,852
23,466
23,080
-
-
Common stockholders' equity
162,108
190,588
188,894
179,561
170,046
Common book value per share (1)
7.61
23.04
22.84
22.23
20.31
Market price per common share
2.93
3.28
3.99
17.22
34.41
Asset Quality Highlights
Nonaccrual loans
$
52,923
$
123,877
$
108,610
$
90,756
$
3,274
Real estate owned, net of valuation allowance
27,064
31,866
9,081
-
-
Accruing troubled debt restructured loans (2)
3,632
97,311
-
-
-
Loans ninety days past due and still accruing
7,481
6,800
1,964
11,853
-
Allowance for loan losses
34,840
32,640
28,524
21,593
17,833
Allowance for loan losses/net loans
2.61
%
1.94
%
1.67
%
1.34
%
1.20
%
Loan chargeoffs
100,146
8,103
4,227
-
-
Real estate chargeoffs
15,614
-
-
-
-
Loan recoveries
883
1,354
-
-
-
Statement of Operations Highlights:
Interest and dividend income
$
107,072
$
123,598
$
128,497
$
131,916
$
128,605
Interest expense
62,692
81,000
90,335
89,653
78,297
Net interest and dividend income
44,380
42,598
38,162
42,263
50,308
Provision for loan losses
101,463
10,865
11,158
3,760
2,652
Noninterest income
2,110
297
5,026
8,825
6,855
Noninterest expenses:
Provision for real estate losses
15,509
2,275
518
-
-
Real estate expenses
4,105
4,945
4,281
489
-
All other noninterest expenses
19,069
19,864
14,074
12,387
13,027
(Loss) earnings before income taxes
(93,656
)
4,946
13,157
34,452
41,484
(Benefit) provision for income taxes
(40,348
)
1,816
5,891
15,012
17,953
Net (loss) earnings before preferred dividend requirements
(53,308
)
3,130
7,266
19,440
23,531
Preferred dividend requirements (3)
1,667
1,632
41
-
-
Net (loss) earnings available to common stockholders
$
(54,975
)
$
1,498
$
7,225
$
19,440
$
23,531
Basic (loss) earnings per common share
$
(4.95
)
$
0.18
$
0.87
$
2.35
$
2.98
Diluted (loss) earnings per common share
$
(4.95
)
$
0.18
$
0.87
$
2.31
$
2.82
Adjusted net (loss) earnings used to calculate
diluted (loss) earnings per common share
$
(54,975
)
$
1,498
$
7,225
$
19,484
$
23,679
Average common shares used to calculate:
Basic (loss) earnings per common share
11,101,196
8,270,812
8,259,091
8,275,539
7,893,489
Diluted (loss) earnings per common share
11,101,196
8,270,812
8,267,781
8,422,017
8,401,379
Common shares outstanding
21,126,489
8,270,812
8,270,812
8,075,812
8,371,595
Net interest margin (4)
2.11
%
1.83
%
1.79
%
2.11
%
2.75
%
Return on average assets
-2.42
%
0.13
%
0.34
%
0.96
%
1.28
%
Return on average common equity
-32.20
%
1.65
%
3.94
%
11.05
%
15.82
%
Effective income tax rate
43.08
%
36.72
%
44.77
%
43.57
%
43.28
%
Efficiency ratio (5)
41
%
46
%
33
%
24
%
23
%
Full-service banking offices
7
7
7
7
7
(1)
Represents common stockholders' equity less preferred dividends in
arrears ($1.4 million at December 31, 2010 only) divided by common
shares outstanding.
(2)
Represent loans whose terms have been modified mostly through the
deferral of principal and/or a partial reduction in interest
payments.
(3)
Represents dividend requirements on cumulative preferred stock held
by the U.S. Treasury and amortization of related preferred stock
discount.
(4)
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 2.17% for
2010, 1.89% for 2009, 1.90% for 2008, 2.46% for 2007 and 3.02% for
2006.
(5)
Represents noninterest expenses (excluding provision for real estate
losses and real estate expenses) as a percentage of net interest and
dividend income plus noninterest income.
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