Luther Burbank Corporation Reports 2017 Fourth Quarter Earnings Per Diluted Common Share of $0.45
SANTA ROSA, Calif., Jan. 25, 2018 (GLOBE NEWSWIRE) -- Luther Burbank Corporation (NASDAQ:LBC) (the “Company”), the holding company for Luther Burbank Savings (the “Bank”), today reported net income available to common shareholders of $20.4 million, or $0.45 diluted earnings per common share (“EPS”), for the quarter ended December 31, 2017, compared to net income available to common shareholders of $13.3 million, or $0.32 EPS, for the quarter ended December 31, 2016. For the twelve months ended December 31, 2017, net income available to common shareholders totaled $69.4 million, or $1.62 EPS compared to $52.1 million, or $1.24 EPS, for the comparable 2016 period. Net income for the fourth quarter of 2017 reflects a net tax benefit of $5.8 million which amount includes a $5.3 million tax benefit from the restatement of the Company's net deferred tax assets related to the revocation of its S Corporation status and the recently enacted Tax Cuts and Jobs Act and a $2.9 million tax benefit from the partial deductibility of contingent IPO costs not recognized as GAAP expenses, partially offset by a $2.4 million tax provision on fourth quarter earnings. Excluding these one-time benefits of $8.2 million, EPS for the quarter ended December 31, 2017 and the twelve months ended December 31, 2017 were $0.27 per share and $1.42 per share, respectively.
John G. Biggs, President and Chief Executive Officer, stated, “Our 34 year history of profitability continues with earnings of over $20 million for the fourth quarter of 2017. What makes this possible is a loan portfolio that now exceeds $5 billion, which was achieved by deeper loan and deposit penetration into our attractive west coast markets.”
Mr. Biggs continued, “Asset growth continues to excel, exceeding 13% for the year. The Company completed a successful common equity IPO, raising net proceeds of over $138 million. This additional capital will allow us to continue building a strong and growing company.”
“At the same time, we remain vigilant to achieving exceptional efficiency of our operations, with one of the best efficiency ratios of our real estate and commercial bank peers. Coupled with our excellent efficiency is our extremely low level of non-performing assets, which at year end was only 0.12% of total assets, again, one of the best ratios of our peers.”
Board Declares Quarterly Cash Dividend of $0.015 Per Share
On January 25, 2018, the Board of Directors of the Company declared a quarterly cash dividend of $0.015 per common share. The fourth quarter dividend declared is prorated based on a regular quarterly cash dividend on our common stock of $0.0575 per share and the portion of the fourth quarter of 2017 during which the Company was a public company, which was 24 days. The dividend is payable on February 15, 2018 to shareholders of record as of February 5, 2018.
Fourth Quarter and Twelve Months Earnings Summary
Net interest income for the quarter ended December 31, 2017 totaled $27.6 million compared to $28.8 million for the previous quarter and $24.2 million for the 2016 fourth quarter. The net interest margin for the quarter ended December 31, 2017 was 2.05%, compared to 2.02% for the previous quarter and 1.98% for the 2016 fourth quarter. For the twelve months ended December 31, 2017, net interest income totaled $111.0 million, compared to $94.6 million for the comparable 2016 period, and the net interest margin was 2.05% for the twelve months ended December 31, 2017, up slightly from 2.04% for the twelve months ended December 31, 2016.
For the quarter ended December 31, 2017, a $1.3 million loan loss provision was recorded compared to a $1.6 million provision in the prior quarter and a $3.6 million reversal recorded in the 2016 fourth quarter. For the twelve months ended December 31, 2017, we recorded a loan loss reversal of $3.4 million compared to a $12.7 million loan loss reversal for the comparable 2016 period.
Noninterest income for the quarter ended December 31, 2017 totaled $1.4 million, compared to $4.9 million for the previous quarter and $3.1 million for the 2016 fourth quarter. Noninterest income for the twelve months ended December 31, 2017 totaled $7.4 million compared to $7.8 million for the comparable 2016 period. The reduction of $3.4 million in noninterest income, or 70.6%, for the quarter ended December 31, 2017 compared to the linked quarter ended September 30, 2017, was attributable to the gain on the $626.1 million multifamily securitization transaction in the third quarter 2017. The reduction of $1.6 million in noninterest income, or 53.1%, for the quarter ended December 31, 2017 compared to the prior quarter ended December 31, 2016, was primarily attributable to a decrease in FHLB dividends of $825,000 as the FHLB provided an special dividend in the fourth quarter of 2016 of $917 thousand and a decrease of $1.2 million in the gain on sale of loans due to no loan sale activity in the quarter ended December 31, 2017. The quarter ending December 31, 2016 included gains from retail single family mortgage banking operations which operations were ended in the first quarter of 2017 and gains from multifamily residential portfolio loans sales completed for purposes of asset liability management.
General and administrative ("G&A") expense for the quarter ended December 31, 2017 totaled $13.2 million compared to $13.8 million for the previous quarter and $17.1 million for the 2016 fourth quarter. The reduction of $3.9 million in G&A expenses, or 22.7%, from the quarter ended December 31, 2017 compared to the quarter ended December 31, 2016, was primarily attributable to compensation and related benefits, resulting from a decrease of $1.1 million in salaries and a $2.3 million reduction in incentive compensation related to the retail mortgage banking operations ending in the first quarter of 2017.
For the twelve months ended December 31, 2017, G&A expense totaled $56.5 million, down from $61.2 million for the 2016 comparable period. The reduction of $4.7 million in G&A expenses, or 7.7% was the result of a net decrease of $2.0 million in compensation and employee benefits, a decrease of $542,000 in professional and regulatory fees and a decrease of $1.8 million in other expenses. The decrease in compensation and employee benefits was primarily related to the retail mortgage banking operations ending in the first quarter of 2017. The decrease in other noninterest expense was primarily attributable to a net reduction in the provision for off-balance sheet items. This was associated with a reduction in unfunded construction loan commitments in 2017 versus an increase in unfunded construction loan commitments in 2016.
Balance Sheet Summary
Total assets at December 31, 2017 were $5.7 billion, an increase of over $640.8 million from December 31, 2016. The increase was primarily due to a $601 million increase in loans and a $48 million increase in investments available for sale.
The multifamily residential (“MFR”) mortgage loan portfolio totaled $2.9 billion at December 31, 2017 compared to $2.6 billion at December 31, 2016 and represents 57.3% of the total loan portfolio. For the quarter and twelve months ended December 31, 2017, MFR loan originations totaled $344.2 million and $1.30 billion, respectively, compared to $338.9 million and $1.06 billion, for the 2016 comparable periods. At December 31, 2017, the MFR pipeline totaled $188.4 million.
The single family residential mortgage loan portfolio totaled $2.0 billion at December 31, 2017, compared to $1.7 billion at December 31, 2016 and represents 38.8% of the total loan portfolio. For the quarter and twelve months ended December 31, 2017, residential loan originations for portfolio totaled $221.1 million and $726.5 million, respectively, compared to $203.7 million and $782.6 million for the comparable 2016 periods. At December 31, 2017, the residential mortgage pipeline totaled approximately $114.0 million.
Deposits totaled $4.0 billion at December 31, 2017, an increase of $617.3 million from December 31, 2016.
Stockholders’ equity totaled $549.7 billion, or 9.6% of total assets at December 31, 2017, an increase of $145.4 million from December 31, 2016, or an increase of 35.9%. Luther Burbank Savings’ capital levels continue to be significantly above the minimum levels required to be designated as “well-capitalized” for bank regulatory purposes. At December 31, 2017, Tier 1 leverage, Common Equity Tier 1 risk based, Tier 1 risk-based and Total risk-based capital ratios were 12.54%, 19.90%, 19.90% and 20.84%, respectively for the Bank, and 11.26%, 16.05%, 17.84% and 18.78%, respectively for the Company. At December 31, 2017, the Company’s tangible common equity ratio was 9.58%.
Asset Quality
Non-performing loans (“NPLs”), totaled $7.0 million, or 0.14% of total loans, at December 31, 2017, compared to $2.6 million, or 0.06% of total loans, at December 31, 2016. There was not any real estate owned at December 31, 2017 or December 31, 2016.
About Luther Burbank Corporation
Luther Burbank Corporation, with assets of $5.7 billion, is the holding company for Luther Burbank Savings. Established in 1983, Luther Burbank Savings, with deposits in California totaling $4.0 billion, is the 19th largest commercial bank in California and provides its business and retail customers and local communities it serves with quality financial products and services through nine convenient banking branch locations in Northern and Southern California and eight lending offices in California, Seattle, Washington and Portland, Oregon. The Company also has multiple delivery channels, including its flexible mobile banking app.
Cautionary Statements Regarding Forward-Looking Information
Certain statements in this earnings release are forward-looking statements that reflect the Company’s current view with respect to, among other things, future events and our Company’s financial and operational performance. These statements are often, but not always, made through the use of such words as “anticipate,” “believe,” “could,” “estimate,” “expect,” “intend,” “may,” “outlook,” “plan,” “potential,” “predict,” “project,” “should,” “will,” “would,” and similar terms and phrases, including references to assumptions.
Forward-looking statements are based on various assumptions and analyses made by us in light of our management’s experience and perception of historical trends, current conditions and expected future developments, as well as other factors we believe are appropriate under the circumstances. These statements are not guarantees of future performance and are subject to risks, uncertainties and other factors (many of which are beyond our control) that could cause actual results to differ materially from future results expressed or implied by such forward-looking statements. These factors include, without limitation, the following: the timing and occurrence or non-occurrence of events that may be subject to circumstances beyond our control; increases in competitive pressure among financial institutions or from non-financial institutions; changes in the interest rate environment; changes in deposit flows, loan demand or collateral values; changes in accounting principles, policies or guidelines; changes in general economic conditions, either nationally or locally in some or all areas in which we do business, or conditions in the real estate or securities markets or the banking industry; legislative or regulatory changes, including those that may be implemented by the new administration in Washington, D.C.; supervision and examination by federal and state banking regulators; our ability to successfully implement technological changes; our ability to successfully consummate new business initiatives; or our ability to implement enhanced risk management policies, procedures and controls commensurate with shifts in our business strategies and regulatory expectations. The forward-looking statements are made as of the date of this communication, and we do not intend, and assume no obligation, to update any forward-looking statements to reflect events or circumstances after the date of this press release, except as required by applicable law.
About Non-GAAP Financial Measures
Certain of the financial measures and ratios we present, including “pre-tax, pre-provision net earnings,” “tangible book value,” “efficiency ratio,” “tangible assets,” “tangible stockholders’ equity,” “tangible stockholders’ equity to tangible assets,” “return on average tangible equity,” “proforma net income” and “proforma ratios” are supplemental measures that are not required by, or are not presented in accordance with, U.S. generally accepted accounting principles (GAAP). We refer to these financial measures and ratios as “non-GAAP financial measures.” We consider the use of select non-GAAP financial measures and ratios to be useful for financial and operational decision making and useful in evaluating period-to-period comparisons. We believe that management and investors benefit from referring to these non-GAAP financial measures in assessing our performance and when planning, forecasting, analyzing and comparing past, present and future periods.
These non-GAAP financial measures should not be considered a substitute for financial information presented in accordance with GAAP and you should not rely on non-GAAP financial measures alone as measures of our performance. The non-GAAP financial measures we present may differ from non-GAAP financial measures used by our peers or other companies. We compensate for these limitations by providing the equivalent GAAP measures whenever we present the non-GAAP financial measures and by including a reconciliation of the impact of the components adjusted for in the non-GAAP financial measure so that both measures and the individual components may be considered when analyzing our performance. A reconciliation of non-GAAP financial measures to the comparable GAAP financial measures is included at the end of the financial statement tables.
| CONSOLIDATED BALANCE SHEETS (UNAUDITED) | ||||||||||||||||||||
| (In thousands except for per share data and ratios) | ||||||||||||||||||||
| 31-Dec-17 | 30-Sep-17 | 30-Jun-17 | 31-Mar-17 | 31-Dec-16 | ||||||||||||||||
| ASSETS | ||||||||||||||||||||
| Cash and cash equivalents | $ | 75,578 | $ | 87,051 | $ | 86,819 | $ | 75,719 | $ | 59,208 | ||||||||||
| Available for sale investment securities, at fair value | 503,288 | 471,438 | 483,846 | 466,564 | 459,162 | |||||||||||||||
| Held to maturity investment securities, at amortized cost | 6,921 | 6,965 | 7,222 | 7,267 | 7,561 | |||||||||||||||
| Loans held-for-sale | - | 39,011 | 701,947 | 47,844 | 34,974 | |||||||||||||||
| Loans held-for-investment (2) | 5,041,547 | 4,630,926 | 4,306,893 | 4,729,359 | 4,439,766 | |||||||||||||||
| Allowance for loan losses | (30,312 | ) | (28,984 | ) | (27,356 | ) | (33,699 | ) | (33,298 | ) | ||||||||||
| Accrued interest receivable | 14,901 | 13,902 | 14,561 | 13,174 | 12,141 | |||||||||||||||
| Federal Home Loan Bank stock | 27,733 | 40,159 | 38,582 | 32,910 | 30,410 | |||||||||||||||
| Premises and equipment, net | 22,452 | 22,697 | 23,262 | 23,785 | 24,356 | |||||||||||||||
| Goodwill | 3,297 | 3,297 | 3,297 | 3,297 | 3,297 | |||||||||||||||
| Prepaid expenses and other assets | 38,975 | 33,095 | 30,344 | 25,320 | 26,008 | |||||||||||||||
| Total assets | $ | 5,704,380 | $ | 5,319,557 | $ | 5,669,417 | $ | 5,391,540 | $ | 5,063,585 | ||||||||||
| LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||||||||||||||
| Liabilities: | ||||||||||||||||||||
| Deposits | $ | 3,951,238 | $ | 3,863,411 | $ | 3,681,175 | $ | 3,620,642 | $ | 3,333,969 | ||||||||||
| Federal Home Loan Bank advances | 989,260 | 807,667 | 1,359,573 | 1,157,480 | 1,111,886 | |||||||||||||||
| Junior subordinated deferrable interest debentures | 61,857 | 61,857 | 61,857 | 61,857 | 61,857 | |||||||||||||||
| Senior debt | 94,161 | 94,128 | 94,095 | 94,061 | 94,028 | |||||||||||||||
| Accrued interest payable | 1,781 | 2,112 | 3,192 | 1,398 | 1,302 | |||||||||||||||
| Other liabilities and accrued expenses | 56,338 | 56,922 | 53,239 | 48,596 | 56,168 | |||||||||||||||
| Total liabilities | 5,154,635 | 4,886,097 | 5,253,131 | 4,984,034 | 4,659,210 | |||||||||||||||
| Stockholders' equity: | ||||||||||||||||||||
| Common stock, no par value; 100,000,000 shares authorized; 56,107,577 and 42,000,000 shares issued and outstanding at December 31, 2017 and 2016, respectively | 458,570 | 2,262 | 2,262 | 2,262 | 2,262 | |||||||||||||||
| Unearned Restricted Stock Award common stock | (4,283 | ) | - | - | - | - | ||||||||||||||
| Retained earnings | 102,459 | 435,912 | 418,664 | 410,143 | 407,648 | |||||||||||||||
| Accumulated other comprehensive loss, net of taxes | (7,001 | ) | (4,714 | ) | (4,640 | ) | (4,899 | ) | (5,535 | ) | ||||||||||
| Total stockholders' equity | 549,745 | 433,460 | 416,286 | 407,506 | 404,375 | |||||||||||||||
| Total liabilities and stockholders' equity | $ | 5,704,380 | $ | 5,319,557 | $ | 5,669,417 | $ | 5,391,540 | $ | 5,063,585 | ||||||||||
| Net tangible book value (1) | $ | 546,448 | $ | 430,163 | $ | 412,989 | $ | 404,209 | $ | 401,078 | ||||||||||
| Period end shares outstanding (3) | 56,107,577 | 42,000,000 | 42,000,000 | 42,000,000 | 42,000,000 | |||||||||||||||
| (1) = Considered a non-GAAP financial measure. See ‘‘Non-GAAP Financial Measures’’ for a reconciliation of our non-GAAP measures to the most directly comparable GAAP financial measure. Pre-tax, pre-provision net earnings is defined as net income plus income tax expense and provision for (reversal of) loan losses. Net tangible book value is defined as total assets less goodwill and total liabilities. Efficiency ratio is defined as the ratio of noninterest expense to net interest income plus noninterest income. Tangible assets is defined as total assets less goodwill. Tangible equity is defined as total equity less goodwill. We calculate our pro forma net income, return on average assets, return on average equity and return on average tangible equity by adding back our franchise S Corporation tax to net income, and using a combined C Corporation effective tax rate for Federal and California income taxes of 42.0%. This calculation reflects only the change in our status as an S Corporation and does not give effect to any other transaction. | ||||||||||||||||||||
| (2) = Loans held-for-investment include unamortized deferred fees/costs. All portfolio loans are collateralized by real estate with the exception of one $50 thousand non-mortgage loan. | ||||||||||||||||||||
| (3) = Earnings per common share, basic and diluted, book value per common share and number of common shares outstanding have been adjusted retroactively to reflect a 200-for-1 stock split effective April 27, 2017. | ||||||||||||||||||||
| CONSOLIDATED INCOME STATEMENTS (UNAUDITED) | |||||||||||||||||||||||||||
| (In thousands except for per share data and ratios) | For the Three Months Ended | For the Years Ended | |||||||||||||||||||||||||
| 31-Dec-17 | 30-Sep-17 | 30-Jun-17 | 31-Mar-17 | 31-Dec-16 | 31-Dec-17 | 31-Dec-16 | |||||||||||||||||||||
| Interest income: | |||||||||||||||||||||||||||
| Interest and fees on loans | $ | 42,477 | $ | 44,180 | $ | 41,173 | $ | 38,743 | $ | 36,054 | $ | 166,573 | $ | 139,385 | |||||||||||||
| Interest and dividends on investment securities | 2,159 | 2,016 | 1,875 | 1,664 | 1,251 | 7,714 | 4,774 | ||||||||||||||||||||
| Total interest income | 44,636 | 46,196 | 43,048 | 40,407 | 37,305 | 174,287 | 144,159 | ||||||||||||||||||||
| Interest expense: | |||||||||||||||||||||||||||
| Interest on deposits | 11,285 | 10,156 | 9,058 | 8,314 | 8,329 | 38,813 | 31,648 | ||||||||||||||||||||
| Interest on FHLB advances | 3,759 | 5,260 | 4,260 | 3,276 | 2,873 | 16,555 | 10,219 | ||||||||||||||||||||
| Interest on junior subordinated deferrable interest debentures | 447 | 430 | 408 | 380 | 368 | 1,665 | 1,348 | ||||||||||||||||||||
| Interest on other borrowings | 1,578 | 1,577 | 1,577 | 1,577 | 1,578 | 6,309 | 6,309 | ||||||||||||||||||||
| Total interest expense | 17,069 | 17,423 | 15,303 | 13,547 | 13,148 | 63,342 | 49,524 | ||||||||||||||||||||
| Net interest income before provision for loan losses | 27,567 | 28,773 | 27,745 | 26,860 | 24,157 | 110,945 | 94,635 | ||||||||||||||||||||
| Provision (reversal) of provision for loan losses | 1,250 | 1,550 | (6,481 | ) | 309 | (3,624 | ) | (3,372 | ) | (12,703 | ) | ||||||||||||||||
| Net interest income after provision (reversal) for loan losses | 26,317 | 27,223 | 34,226 | 26,551 | 27,781 | 114,317 | 107,338 | ||||||||||||||||||||
| Noninterest income: | |||||||||||||||||||||||||||
| Increase in cash surrender value of life insurance | 48 | 48 | 47 | 49 | 55 | 192 | 233 | ||||||||||||||||||||
| Net gain on sale of loans | - | 4,133 | (693 | ) | (163 | ) | 1,140 | 3,277 | 3,884 | ||||||||||||||||||
| FHLB dividends | 696 | 581 | 562 | 634 | 1,521 | 2,473 | 2,848 | ||||||||||||||||||||
| Other income | 737 | 156 | 272 | 351 | 344 | 1,516 | 879 | ||||||||||||||||||||
| Total noninterest income | 1,481 | 4,918 | 188 | 871 | 3,060 | 7,458 | 7,844 | ||||||||||||||||||||
| Noninterest expense: | |||||||||||||||||||||||||||
| Compensation and related benefits | 8,140 | 8,664 | 9,523 | 10,197 | 11,887 | 36,524 | 38,551 | ||||||||||||||||||||
| Deposit insurance premium | 404 | 580 | 431 | 397 | 375 | 1,812 | 1,725 | ||||||||||||||||||||
| Professional and regulatory fees | 582 | 428 | 840 | 184 | 650 | 2,034 | 2,577 | ||||||||||||||||||||
| Occupancy | 1,295 | 1,339 | 1,223 | 1,298 | 1,280 | 5,155 | 5,477 | ||||||||||||||||||||
| Depreciation and amortization | 724 | 717 | 728 | 734 | 743 | 2,903 | 2,873 | ||||||||||||||||||||
| Data processing | 789 | 791 | 797 | 790 | 933 | 3,167 | 3,322 | ||||||||||||||||||||
| Marketing | 298 | 253 | 205 | 179 | 294 | 935 | 875 | ||||||||||||||||||||
| Other expenses | 989 | 1,010 | 1,093 | 922 | 938 | 4,014 | 5,842 | ||||||||||||||||||||
| Total noninterest expense | 13,221 | 13,782 | 14,840 | 14,701 | 17,100 | 56,544 | 61,242 | ||||||||||||||||||||
| Income before provision for income taxes | 14,577 | 18,359 | 19,574 | 12,721 | 13,741 | 65,231 | 53,940 | ||||||||||||||||||||
| Provision for income taxes | (5,844 | ) | 612 | 653 | 426 | 464 | (4,153 | ) | 1,819 | ||||||||||||||||||
| Net income | $ | 20,421 | $ | 17,747 | $ | 18,921 | $ | 12,295 | $ | 13,277 | $ | 69,384 | $ | 52,121 | |||||||||||||
| Basic earnings per common share (3) | $ | 0.45 | $ | 0.42 | $ | 0.45 | $ | 0.29 | $ | 0.32 | $ | 1.62 | $ | 1.24 | |||||||||||||
| Diluted earnings per common share (3) | $ | 0.45 | $ | 0.42 | $ | 0.45 | $ | 0.29 | $ | 0.32 | $ | 1.62 | $ | 1.24 | |||||||||||||
| Weighted average common shares outstanding - basic (3) | 45,667,516 | 42,000,000 | 42,000,000 | 42,000,000 | 42,000,000 | 42,916,879 | 42,000,000 | ||||||||||||||||||||
| Weighted average common shares outstanding - diluted (3) | 45,831,743 | 42,000,000 | 42,000,000 | 42,000,000 | 42,000,000 | 42,957,936 | 42,000,000 | ||||||||||||||||||||
| (1) = Considered a non-GAAP financial measure. See ‘‘Non-GAAP Financial Measures’’ for a reconciliation of our non-GAAP measures to the most directly comparable GAAP financial measure. Pre-tax, pre-provision net earnings is defined as net income plus income tax expense and provision for (reversal of) loan losses. Net tangible book value is defined as total assets less goodwill and total liabilities. Efficiency ratio is defined as the ratio of noninterest expense to net interest income plus noninterest income. Tangible assets is defined as total assets less goodwill. Tangible equity is defined as total equity less goodwill. We calculate our pro forma net income, return on average assets, return on average equity and return on average tangible equity by adding back our franchise S Corporation tax to net income, and using a combined C Corporation effective tax rate for Federal and California income taxes of 42.0%. This calculation reflects only the change in our status as an S Corporation and does not give effect to any other transaction. | |||||||||||||||||||||||||||
| (2) = Loans held-for-investment include unamortized deferred fees/costs. All portfolio loans are collateralized by real estate with the exception of one $50 thousand non-mortgage loan. | |||||||||||||||||||||||||||
| (3) = Earnings per common share, basic and diluted, book value per common share and number of common shares outstanding have been adjusted retroactively to reflect a 200-for-1 stock split effective April 27, 2017. | |||||||||||||||||||||||||||
| CONSOLIDATED FINANCIAL HIGHLIGHTS | ||||||||||||||||||||||||||||
| (In thousands except for per share data and ratios) | As of or for the Three Months Ended | As of or for the Years Ended | ||||||||||||||||||||||||||
| 31-Dec-17 | 30-Sep-17 | 30-Jun-17 | 31-Mar-17 | 31-Dec-16 | 31-Dec-17 | 31-Dec-16 | ||||||||||||||||||||||
| RESULTS OF OPERATIONS | ||||||||||||||||||||||||||||
| Interest income | $ | 44,636 | $ | 46,196 | $ | 43,048 | $ | 40,407 | $ | 37,305 | $ | 174,287 | $ | 144,159 | ||||||||||||||
| Interest expense | 17,069 | 17,423 | 15,303 | 13,547 | 13,148 | 63,342 | 49,524 | |||||||||||||||||||||
| Net interest income | 27,567 | 28,773 | 27,745 | 26,860 | 24,157 | 110,945 | 94,635 | |||||||||||||||||||||
| Provision for (reversal of) loan losses | 1,250 | 1,550 | (6,481 | ) | 309 | (3,624 | ) | (3,372 | ) | (12,703 | ) | |||||||||||||||||
| Net interest income after provision for loan losses | 26,317 | 27,223 | 34,226 | 26,551 | 27,781 | 114,317 | 107,338 | |||||||||||||||||||||
| Noninterest income | 1,481 | 4,918 | 188 | 871 | 3,060 | 7,458 | 7,844 | |||||||||||||||||||||
| Noninterest expense | 13,221 | 13,782 | 14,840 | 14,701 | 17,100 | 56,544 | 61,242 | |||||||||||||||||||||
| Income before provision for income taxes | 14,577 | 18,359 | 19,574 | 12,721 | 13,741 | 65,231 | 53,940 | |||||||||||||||||||||
| Provision for income taxes | (5,844 | ) | 612 | 653 | 426 | 464 | (4,153 | ) | 1,819 | |||||||||||||||||||
| Net income | $ | 20,421 | $ | 17,747 | $ | 18,921 | $ | 12,295 | $ | 13,277 | $ | 69,384 | $ | 52,121 | ||||||||||||||
| Pre-tax, pre-provision net earnings (1) | 15,827 | 19,909 | 13,093 | 13,030 | 10,117 | 61,859 | 41,237 | |||||||||||||||||||||
| Basic earnings per share (3) | $ | 0.45 | $ | 0.42 | $ | 0.45 | $ | 0.29 | $ | 0.32 | $ | 1.62 | $ | 1.24 | ||||||||||||||
| Diluted earnings per share (3) | $ | 0.45 | $ | 0.42 | $ | 0.45 | $ | 0.29 | $ | 0.32 | $ | 1.62 | $ | 1.24 | ||||||||||||||
| Average basic shares outstanding (3) | 45,667,516 | 42,000,000 | 42,000,000 | 42,000,000 | 42,000,000 | 42,916,879 | 42,000,000 | |||||||||||||||||||||
| Average diluted shares outstanding (3) | 45,831,743 | 42,000,000 | 42,000,000 | 42,000,000 | 42,000,000 | 42,957,936 | 42,000,000 | |||||||||||||||||||||
| PERFORMANCE RATIOS | ||||||||||||||||||||||||||||
| Return on average: | ||||||||||||||||||||||||||||
| Assets | 1.50 | % | 1.23 | % | 1.37 | % | 0.95 | % | 1.08 | % | 1.26 | % | 1.11 | % | ||||||||||||||
| Stockholders' equity | 17.97 | % | 16.62 | % | 18.41 | % | 12.01 | % | 13.15 | % | 16.30 | % | 13.35 | % | ||||||||||||||
| Tangible stockholders' equity (1) | 14.95 | % | 16.50 | % | 18.33 | % | 12.17 | % | 13.24 | % | 12.70 | % | 13.00 | % | ||||||||||||||
| Efficiency ratio (1) | 45.51 | % | 40.91 | % | 53.13 | % | 53.01 | % | 62.83 | % | 47.76 | % | 59.76 | % | ||||||||||||||
| Noninterest expense to average assets | 0.97 | % | 0.95 | % | 1.08 | % | 1.14 | % | 1.39 | % | 1.03 | % | 1.31 | % | ||||||||||||||
| Loans to deposit ratio | 127.59 | % | 120.88 | % | 136.07 | % | 131.94 | % | 134.22 | % | 127.59 | % | 134.22 | % | ||||||||||||||
| Average stockholders' equity to average assets | 8.32 | % | 7.38 | % | 7.45 | % | 7.92 | % | 8.21 | % | 7.76 | % | 8.35 | % | ||||||||||||||
| Dividend payout ratio | 230.64 | % | 2.82 | % | 54.97 | % | 79.71 | % | 33.89 | % | 97.72 | % | 32.23 | % | ||||||||||||||
| PRO FORMA | ||||||||||||||||||||||||||||
| Pro forma net income (1) | 8,455 | 10,648 | 11,353 | 7,378 | 7,970 | 37,834 | 31,285 | |||||||||||||||||||||
| Pro forma return on average: | ||||||||||||||||||||||||||||
| Assets (1) | 0.62 | % | 0.74 | % | 0.82 | % | 0.57 | % | 0.65 | % | 0.69 | % | 0.67 | % | ||||||||||||||
| Stockholders' equity (1) | 7.44 | % | 9.97 | % | 11.04 | % | 7.21 | % | 7.89 | % | 8.89 | % | 8.02 | % | ||||||||||||||
| Tangible stockholders' equity (1) | 7.49 | % | 10.05 | % | 11.13 | % | 7.27 | % | 7.96 | % | 8.96 | % | 8.08 | % | ||||||||||||||
| YIELDS/ RATES | ||||||||||||||||||||||||||||
| Yield on loans | 3.53 | % | 3.46 | % | 3.37 | % | 3.38 | % | 3.31 | % | 3.43 | % | 3.36 | % | ||||||||||||||
| Yield on investments | 1.57 | % | 1.39 | % | 1.38 | % | 1.32 | % | 1.07 | % | 1.42 | % | 1.07 | % | ||||||||||||||
| Yield on interest earning assets | 3.31 | % | 3.24 | % | 3.16 | % | 3.16 | % | 3.06 | % | 3.22 | % | 3.11 | % | ||||||||||||||
| Cost of deposits | 1.15 | % | 1.09 | % | 1.00 | % | 0.96 | % | 1.01 | % | 1.05 | % | 0.99 | % | ||||||||||||||
| Cost of borrowings | 2.25 | % | 1.85 | % | 1.75 | % | 1.69 | % | 1.68 | % | 1.86 | % | 1.73 | % | ||||||||||||||
| Cost of interest bearing liabilities | 1.38 | % | 1.31 | % | 1.21 | % | 1.15 | % | 1.18 | % | 1.27 | % | 1.17 | % | ||||||||||||||
| Net interest spread | 1.93 | % | 1.93 | % | 1.95 | % | 2.01 | % | 1.88 | % | 1.95 | % | 1.94 | % | ||||||||||||||
| Net interest margin | 2.05 | % | 2.02 | % | 2.03 | % | 2.10 | % | 1.98 | % | 2.05 | % | 2.04 | % | ||||||||||||||
| (1) = Considered a non-GAAP financial measure. See ‘‘Non-GAAP Financial Measures’’ for a reconciliation of our non-GAAP measures to the most directly comparable GAAP financial measure. Pre-tax, pre-provision net earnings is defined as net income plus income tax expense and provision for (reversal of) loan losses. Net tangible book value is defined as total assets less goodwill and total liabilities. Efficiency ratio is defined as the ratio of noninterest expense to net interest income plus noninterest income. Tangible assets is defined as total assets less goodwill. Tangible equity is defined as total equity less goodwill. We calculate our pro forma net income, return on average assets, return on average equity and return on average tangible equity by adding back our franchise S Corporation tax to net income, and using a combined C Corporation effective tax rate for Federal and California income taxes of 42.0%. This calculation reflects only the change in our status as an S Corporation and does not give effect to any other transaction. | ||||||||||||||||||||||||||||
| (2) = Loans held-for-investment include unamortized deferred fees/costs. All portfolio loans are collateralized by real estate with the exception of one $50 thousand non-mortgage loan. | ||||||||||||||||||||||||||||
| (3) = Earnings per common share, basic and diluted, book value per common share and number of common shares outstanding have been adjusted retroactively to reflect a 200-for-1 stock split effective April 27, 2017. | ||||||||||||||||||||||||||||
| CONSOLIDATED FINANCIAL HIGHLIGHTS | ||||||||||||||||||||||||||||
| (In thousands except for per share data and ratios) | As of or for the Three Months Ended | As of or for the Years Ended | ||||||||||||||||||||||||||
| 31-Dec-17 | 30-Sep-17 | 30-Jun-17 | 31-Mar-17 | 31-Dec-16 | 31-Dec-17 | 31-Dec-16 | ||||||||||||||||||||||
| CAPITAL | ||||||||||||||||||||||||||||
| Total equity to total assets | 9.64 | % | 8.15 | % | 7.34 | % | 7.56 | % | 7.99 | % | 9.64 | % | 7.99 | % | ||||||||||||||
| Tangible stockholders' equity to tangible assets (1) | 9.58 | % | 8.09 | % | 7.29 | % | 7.50 | % | 7.93 | % | 9.58 | % | 7.93 | % | ||||||||||||||
| Book value per share | $ | 9.80 | $ | 10.32 | $ | 9.91 | $ | 9.70 | $ | 9.63 | $ | 9.80 | $ | 9.63 | ||||||||||||||
| Tangible book value per share (1) | $ | 9.74 | $ | 10.24 | $ | 9.83 | $ | 9.62 | $ | 9.55 | $ | 9.74 | $ | 9.55 | ||||||||||||||
| Market value per share (period end) | $ | 12.04 | N/A | N/A | N/A | N/A | $ | 12.04 | N/A | |||||||||||||||||||
| AVERAGE BALANCES | ||||||||||||||||||||||||||||
| Loans and loans held for sale | $ | 4,818,654 | $ | 5,109,599 | $ | 4,887,459 | $ | 4,578,372 | $ | 4,360,442 | $ | 4,849,894 | $ | 4,146,713 | ||||||||||||||
| Earning assets | 5,388,238 | 5,705,891 | 5,455,216 | 5,113,760 | 4,869,178 | 5,417,323 | 4,633,321 | |||||||||||||||||||||
| Total assets | 5,461,226 | 5,786,035 | 5,517,404 | 5,172,186 | 4,921,585 | 5,485,832 | 4,676,676 | |||||||||||||||||||||
| Deposits | 3,914,149 | 3,734,643 | 3,627,225 | 3,467,450 | 3,313,524 | 3,687,224 | 3,200,180 | |||||||||||||||||||||
| Total equity | 454,635 | 427,018 | 411,176 | 409,451 | 404,014 | 425,698 | 390,318 | |||||||||||||||||||||
| Tangible equity (1) | 451,338 | 423,721 | 407,879 | 406,154 | 400,717 | 422,401 | 387,021 | |||||||||||||||||||||
| ASSET QUALITY | ||||||||||||||||||||||||||||
| Net (charge-offs) recoveries | $ | 78 | $ | 78 | $ | 138 | $ | 92 | $ | (2 | ) | $ | 386 | $ | 492 | |||||||||||||
| Nonperforming loans | 7,037 | 5,829 | 6,123 | 4,314 | 2,641 | 7,037 | 2,641 | |||||||||||||||||||||
| Nonperforming assets | 7,037 | 5,829 | 6,123 | 4,314 | 2,641 | 7,037 | 2,641 | |||||||||||||||||||||
| Allowance for loan losses | 30,312 | 28,984 | 27,356 | 33,699 | 33,298 | 30,312 | 33,298 | |||||||||||||||||||||
| Annualized net (charge offs) recoveries to average loans | 0.01 | % | 0.01 | % | 0.01 | % | 0.01 | % | 0.00 | % | 0.01 | % | 0.01 | % | ||||||||||||||
| Nonperforming loans to total loans | 0.14 | % | 0.13 | % | 0.12 | % | 0.09 | % | 0.06 | % | 0.14 | % | 0.06 | % | ||||||||||||||
| Nonperforming assets to total assets | 0.12 | % | 0.11 | % | 0.11 | % | 0.08 | % | 0.05 | % | 0.12 | % | 0.05 | % | ||||||||||||||
| Allowance for loan losses to loans held-for-investment (2) | 0.60 | % | 0.63 | % | 0.64 | % | 0.71 | % | 0.75 | % | 0.60 | % | 0.75 | % | ||||||||||||||
| Allowance for loan losses to nonperforming loans | 430.75 | % | 497.24 | % | 446.77 | % | 781.15 | % | 1260.81 | % | 430.75 | % | 1260.81 | % | ||||||||||||||
| LOAN COMPOSITION | ||||||||||||||||||||||||||||
| Multifamily residential | $ | 2,887,438 | $ | 2,628,691 | $ | 3,055,559 | $ | 2,889,947 | $ | 2,600,262 | $ | 2,887,438 | $ | 2,600,262 | ||||||||||||||
| Single family residential | 1,957,546 | 1,857,042 | 1,787,194 | 1,734,911 | 1,746,148 | 1,957,546 | 1,746,148 | |||||||||||||||||||||
| Commercial real estate | 112,492 | 95,668 | 73,459 | 69,754 | 59,611 | 112,492 | 59,611 | |||||||||||||||||||||
| Construction and land | 41,165 | 48,004 | 51,433 | 42,142 | 29,465 | 41,165 | 29,465 | |||||||||||||||||||||
| Non-mortgage | 50 | 50 | 50 | 50 | 50 | 50 | 50 | |||||||||||||||||||||
| DEPOSIT COMPOSITION | ||||||||||||||||||||||||||||
| Non-interest bearing transaction accounts | $ | 30,899 | $ | 27,166 | $ | 23,907 | $ | 14,490 | $ | 11,826 | $ | 30,899 | $ | 11,826 | ||||||||||||||
| Interest bearing transaction accounts | 203,159 | 196,062 | 192,033 | 197,729 | 191,892 | 203,159 | 191,892 | |||||||||||||||||||||
| Money market deposit accounts | 1,474,498 | 1,430,201 | 1,532,234 | 1,571,721 | 1,500,976 | 1,474,498 | 1,500,976 | |||||||||||||||||||||
| Time deposits | 2,242,682 | 2,209,982 | 1,933,001 | 1,836,702 | 1,629,275 | 2,242,682 | 1,629,275 | |||||||||||||||||||||
| (1) = Considered a non-GAAP financial measure. See ‘‘Non-GAAP Financial Measures’’ for a reconciliation of our non-GAAP measures to the most directly comparable GAAP financial measure. Pre-tax, pre-provision net earnings is defined as net income plus income tax expense and provision for (reversal of) loan losses. Net tangible book value is defined as total assets less goodwill and total liabilities. Efficiency ratio is defined as the ratio of noninterest expense to net interest income plus noninterest income. Tangible assets is defined as total assets less goodwill. Tangible equity is defined as total equity less goodwill. We calculate our pro forma net income, return on average assets, return on average equity and return on average tangible equity by adding back our franchise S Corporation tax to net income, and using a combined C Corporation effective tax rate for Federal and California income taxes of 42.0%. This calculation reflects only the change in our status as an S Corporation and does not give effect to any other transaction. | ||||||||||||||||||||||||||||
| (2) = Loans held-for-investment include unamortized deferred fees/costs. All portfolio loans are collateralized by real estate with the exception of one $50 thousand non-mortgage loan. | ||||||||||||||||||||||||||||
| (3) = Earnings per common share, basic and diluted, book value per common share and number of common shares outstanding have been adjusted retroactively to reflect a 200-for-1 stock split effective April 27, 2017. | ||||||||||||||||||||||||||||
| Average Balance Sheet and Net Interest Analysis | ||||||||||||||||||||||||||||||||||||||||||||||||
| (Dollars in thousands) | ||||||||||||||||||||||||||||||||||||||||||||||||
| For the Three Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||
| 12/31/2017 | 9/30/2017 | 6/30/2017 | 3/31/2017 | 12/31/2016 | ||||||||||||||||||||||||||||||||||||||||||||
| Average | Interest | Average | Average | Interest | Average | Average | Interest | Average | Average | Interest | Average | Average | Interest | Average | ||||||||||||||||||||||||||||||||||
| Balance | Inc / Exp | Yield/Rate (6) | Balance | Inc / Exp | Yield/Rate (6) | Balance | Inc / Exp | Yield/Rate (6) | Balance | Inc / Exp | Yield/Rate (6) | Balance | Inc / Exp | Yield/Rate (6) | ||||||||||||||||||||||||||||||||||
| Interest-Earning Assets | ||||||||||||||||||||||||||||||||||||||||||||||||
| Multifamily residential | $ | 2,748,817 | $ | 25,093 | 3.65 | % | $ | 3,127,491 | $ | 27,445 | 3.51 | % | $ | 2,987,171 | $ | 25,681 | 3.44 | % | $ | 2,724,909 | $ | 23,490 | 3.45 | % | $ | 2,524,648 | $ | 21,690 | 3.44 | % | ||||||||||||||||||
| Single family residential | 1,924,628 | 15,830 | 3.29 | % | 1,852,487 | 15,371 | 3.32 | % | 1,780,312 | 14,178 | 3.19 | % | 1,755,119 | 14,118 | 3.22 | % | 1,744,356 | 13,444 | 3.08 | % | ||||||||||||||||||||||||||||
| Commercial | 97,252 | 1,120 | 4.61 | % | 81,577 | 933 | 4.57 | % | 71,907 | 841 | 4.68 | % | 60,953 | 784 | 5.14 | % | 56,555 | 668 | 4.72 | % | ||||||||||||||||||||||||||||
| Construction, land and NM | 47,957 | 434 | 3.62 | % | 48,044 | 431 | 3.59 | % | 48,069 | 473 | 3.94 | % | 37,391 | 351 | 3.75 | % | 34,883 | 252 | 2.89 | % | ||||||||||||||||||||||||||||
| Total loans (1) | 4,818,654 | 42,477 | 3.53 | % | 5,109,599 | 44,180 | 3.46 | % | 4,887,459 | 41,173 | 3.37 | % | 4,578,372 | 38,743 | 3.38 | % | 4,360,442 | 36,054 | 3.31 | % | ||||||||||||||||||||||||||||
| Securities available-for-sale | 473,085 | 1,826 | 1.54 | % | 484,469 | 1,646 | 1.36 | % | 475,090 | 1,603 | 1.35 | % | 456,953 | 1,477 | 1.29 | % | 421,956 | 1,088 | 1.03 | % | ||||||||||||||||||||||||||||
| Securities held-to-maturity (2) | 6,948 | 59 | 3.40 | % | 7,047 | 57 | 3.24 | % | 7,249 | 61 | 3.37 | % | 7,452 | 59 | 3.17 | % | 7,751 | 62 | 3.20 | % | ||||||||||||||||||||||||||||
| Cash and cash equivalents | 89,551 | 274 | 1.22 | % | 104,776 | 313 | 1.19 | % | 85,418 | 211 | 0.99 | % | 70,983 | 128 | 0.72 | % | 79,029 | 101 | 0.51 | % | ||||||||||||||||||||||||||||
| Total interest-earning assets | $ | 5,388,238 | $ | 44,636 | 3.31 | % | $ | 5,705,891 | $ | 46,196 | 3.24 | % | $ | 5,455,216 | $ | 43,048 | 3.16 | % | $ | 5,113,760 | $ | 40,407 | 3.16 | % | $ | 4,869,178 | $ | 37,305 | 3.06 | % | ||||||||||||||||||
| Noninterest-earning assets | 72,988 | 80,144 | 62,188 | 58,426 | 52,407 | |||||||||||||||||||||||||||||||||||||||||||
| Total Assets | $ | 5,461,226 | $ | 5,786,035 | $ | 5,517,404 | $ | 5,172,186 | $ | 4,921,585 | ||||||||||||||||||||||||||||||||||||||
| Interest-Bearing Liabilities | ||||||||||||||||||||||||||||||||||||||||||||||||
| Transaction accounts (3) | $ | 236,169 | $ | 427 | 0.72 | % | $ | 220,206 | $ | 416 | 0.76 | % | $ | 212,295 | $ | 359 | 0.68 | % | $ | 205,712 | $ | 351 | 0.68 | % | $ | 197,987 | $ | 333 | 0.67 | % | ||||||||||||||||||
| Money market demand accounts | 1,423,937 | 3,079 | 0.86 | % | 1,462,382 | 3,016 | 0.82 | % | 1,553,124 | 3,085 | 0.79 | % | 1,545,433 | 2,919 | 0.76 | % | 1,493,331 | 2,822 | 0.76 | % | ||||||||||||||||||||||||||||
| Time deposits | 2,254,043 | 7,779 | 1.38 | % | 2,052,055 | 6,724 | 1.31 | % | 1,861,806 | 5,614 | 1.21 | % | 1,716,305 | 5,044 | 1.18 | % | 1,622,206 | 5,174 | 1.28 | % | ||||||||||||||||||||||||||||
| Total deposits | 3,914,149 | 11,285 | 1.15 | % | 3,734,643 | 10,156 | 1.09 | % | 3,627,225 | 9,058 | 1.00 | % | 3,467,450 | 8,314 | 0.96 | % | 3,313,524 | 8,329 | 1.01 | % | ||||||||||||||||||||||||||||
| FHLB advances | 873,206 | 3,759 | 1.72 | % | 1,412,319 | 5,260 | 1.49 | % | 1,271,353 | 4,260 | 1.34 | % | 1,084,901 | 3,276 | 1.21 | % | 993,505 | 2,873 | 1.16 | % | ||||||||||||||||||||||||||||
| Senior debt | 94,139 | 1,578 | 6.70 | % | 94,106 | 1,577 | 6.70 | % | 94,073 | 1,577 | 6.71 | % | 94,037 | 1,577 | 6.71 | % | 94,006 | 1,578 | 6.71 | % | ||||||||||||||||||||||||||||
| Junior subordinated debentures | 61,857 | 447 | 2.89 | % | 61,857 | 430 | 2.78 | % | 61,857 | 408 | 2.64 | % | 61,857 | 380 | 2.46 | % | 61,857 | 368 | 2.38 | % | ||||||||||||||||||||||||||||
| Total interest-bearing liabilities | $ | 4,943,351 | $ | 17,069 | 1.38 | % | $ | 5,302,925 | $ | 17,423 | 1.31 | % | $ | 5,054,508 | $ | 15,303 | 1.21 | % | $ | 4,708,245 | $ | 13,547 | 1.15 | % | $ | 4,462,892 | $ | 13,148 | 1.18 | % | ||||||||||||||||||
| Noninterest-bearing liabilities | 63,240 | 56,092 | 51,720 | 54,490 | 54,679 | |||||||||||||||||||||||||||||||||||||||||||
| Total stockholders' equity | 454,635 | 427,018 | 411,176 | 409,451 | 404,014 | |||||||||||||||||||||||||||||||||||||||||||
| Total liabilities and stockholders' equity | $ | 5,461,226 | $ | 5,786,035 | $ | 5,517,404 | $ | 5,172,186 | $ | 4,921,585 | ||||||||||||||||||||||||||||||||||||||
| Net interest spread (4) | 1.93 | % | 1.93 | % | 1.95 | % | 2.01 | % | 1.88 | % | ||||||||||||||||||||||||||||||||||||||
| Net interest income/margin (5) | $ | 27,567 | 2.05 | % | $ | 28,773 | 2.02 | % | $ | 27,745 | 2.03 | % | $ | 26,860 | 2.10 | % | $ | 24,157 | 1.98 | % | ||||||||||||||||||||||||||||
| (1) Loan balance includes portfolio real estate loans, real estate loans held for sale and one $50 thousand non-mortgage loan. Non-accrual loans are included in total loan balances. No adjustment has been made for these loans in the calculation of yields. Interest income on loans includes amortization of deferred loan fees, net of deferred loan costs. | ||||||||||||||||||||||||||||||||||||||||||||||||
| (2) Securities held to maturity include municipal securities. Yields are not calculated on a tax equivalent basis. | ||||||||||||||||||||||||||||||||||||||||||||||||
| (3) Transaction accounts include both interest and non-interest bearing deposits. | ||||||||||||||||||||||||||||||||||||||||||||||||
| (4) Net interest spread is the average yield on total interest-earning assets minus the average rate on total interest-bearing liabilities. | ||||||||||||||||||||||||||||||||||||||||||||||||
| (5) Net interest margin is net interest income divided by total interest-earning assets. | ||||||||||||||||||||||||||||||||||||||||||||||||
| (6) Yields shown are annualized. | ||||||||||||||||||||||||||||||||||||||||||||||||
| Average Balance Sheet and Net Interest Analysis | ||||||||||||||||||||
| (Dollars in thousands) | ||||||||||||||||||||
| For the Years Ended December 31, | ||||||||||||||||||||
| 2017 | 2016 | |||||||||||||||||||
| Average | Interest | Average | Average | Interest | Average | |||||||||||||||
| Balance | Inc / Exp | Yield/Rate | Balance | Inc / Exp | Yield/Rate | |||||||||||||||
| Interest-Earning Assets | ||||||||||||||||||||
| Multifamily residential | $ | 2,897,794 | 101,708 | 3.51 | % | $ | 2,437,487 | 84,766 | 3.48 | % | ||||||||||
| Single family residential | 1,828,668 | 59,498 | 3.25 | % | 1,629,370 | 50,756 | 3.12 | % | ||||||||||||
| Commercial | 78,032 | 3,678 | 4.71 | % | 49,863 | 2,886 | 5.79 | % | ||||||||||||
| Construction, land and NM | 45,400 | 1,689 | 3.72 | % | 29,993 | 977 | 3.26 | % | ||||||||||||
| Total loans (1) | 4,849,894 | 166,573 | 3.43 | % | 4,146,713 | 139,385 | 3.36 | % | ||||||||||||
| Securities available-for-sale | 472,477 | 6,553 | 1.39 | % | 402,035 | 4,151 | 1.03 | % | ||||||||||||
| Securities held-to-maturity (2) | 7,172 | 236 | 3.29 | % | 8,570 | 253 | 2.95 | % | ||||||||||||
| Cash and cash equivalents | 87,780 | 925 | 1.05 | % | 76,003 | 370 | 0.49 | % | ||||||||||||
| Total interest-earning assets | $ | 5,417,323 | $ | 174,287 | 3.22 | % | $ | 4,633,321 | $ | 144,159 | 3.11 | % | ||||||||
| Noninterest-earning assets | 68,509 | 43,355 | ||||||||||||||||||
| Total Assets | $ | 5,485,832 | $ | 4,676,676 | ||||||||||||||||
| Interest-Bearing Liabilities | ||||||||||||||||||||
| Transaction accounts (3) | $ | 218,683 | $ | 1,553 | 0.71 | % | $ | 130,573 | $ | 502 | 0.38 | % | ||||||||
| Money market demand accounts | 1,495,794 | 12,099 | 0.81 | % | 1,440,129 | 10,506 | 0.73 | % | ||||||||||||
| Time deposits | 1,972,747 | 25,161 | 1.28 | % | 1,629,478 | 20,640 | 1.27 | % | ||||||||||||
| Total deposits | 3,687,224 | 38,813 | 1.05 | % | 3,200,180 | 31,648 | 0.99 | % | ||||||||||||
| FHLB advances | 1,160,555 | 16,555 | 1.43 | % | 879,237 | 10,219 | 1.16 | % | ||||||||||||
| Senior debt | 94,090 | 6,309 | 6.71 | % | 93,956 | 6,309 | 6.71 | % | ||||||||||||
| Junior subordinated debentures | 61,857 | 1,665 | 2.69 | % | 61,857 | 1,348 | 2.18 | % | ||||||||||||
| Total interest-bearing liabilities | $ | 5,003,726 | $ | 63,342 | 1.27 | % | $ | 4,235,230 | $ | 49,524 | 1.17 | % | ||||||||
| Noninterest-bearing liabilities | 56,408 | 51,128 | ||||||||||||||||||
| Total stockholders' equity | 425,698 | 390,318 | ||||||||||||||||||
| Total liabilities and stockholders' equity | $ | 5,485,832 | $ | 4,676,676 | ||||||||||||||||
| Net interest spread (4) | 1.95 | % | 1.94 | % | ||||||||||||||||
| Net interest income/margin (5) | $ | 110,945 | 2.05 | % | $ | 94,635 | 2.04 | % | ||||||||||||
| (1) Loan balance includes portfolio real estate loans, real estate loans held for sale and one $50 thousand non-mortgage loan. Non-accrual loans are included in total loan balances. No adjustment has been made for these loans in the calculation of yields. Interest income on loans includes amortization of deferred loan fees, net of deferred loan costs. | ||||||||||||||||||||
| (2) Securities held to maturity include municipal securities . Yields are not calculated on a tax equivalent basis. | ||||||||||||||||||||
| (3) Transaction accounts include both interest and non-interest bearing deposits. See "Selected Historical Financial Data". | ||||||||||||||||||||
| (4) Net interest spread is the average yield on total interest-earning assets minus the average rate on total interest-bearing liabilities. | ||||||||||||||||||||
| (5) Net interest margin is net interest income divided by total interest-earning assets. | ||||||||||||||||||||
| Non-GAAP Reconciliation | ||||||||||||||||||||||||||||||
| (Dollars in thousands) | As of and for the Three Months Ended | As of and for the Years Ended | ||||||||||||||||||||||||||||
| 31-Dec-17 | 30-Sep-17 | 30-Jun-17 | 31-Mar-17 | 31-Dec-16 | 31-Dec-17 | 31-Dec-16 | ||||||||||||||||||||||||
| Pre-tax, pre-provision net earnings | ||||||||||||||||||||||||||||||
| Income before taxes | $ | 14,577 | $ | 18,359 | $ | 19,574 | $ | 12,721 | $ | 13,741 | $ | 65,231 | $ | 53,940 | ||||||||||||||||
| Plus: Provision (reversal of provision) for loan losses | 1,250 | 1,550 | (6,481 | ) | 309 | (3,624 | ) | (3,372 | ) | (12,703 | ) | |||||||||||||||||||
| Pre-tax, pre-provision net earnings | $ | 15,827 | $ | 19,909 | $ | 13,093 | $ | 13,030 | $ | 10,117 | $ | 61,859 | $ | 41,237 | ||||||||||||||||
| Net Tangible Book Value | ||||||||||||||||||||||||||||||
| Total Assets | $ | 5,704,380 | $ | 5,319,557 | $ | 5,669,417 | $ | 5,391,540 | $ | 5,063,585 | $ | 5,704,380 | $ | 5,063,585 | ||||||||||||||||
| Less: Goodwill | (3,297 | ) | (3,297 | ) | (3,297 | ) | (3,297 | ) | (3,297 | ) | (3,297 | ) | (3,297 | ) | ||||||||||||||||
| Less: Total liabilities | (5,154,635 | ) | (4,886,097 | ) | (5,253,131 | ) | (4,984,034 | ) | (4,659,210 | ) | (5,154,635 | ) | (4,659,210 | ) | ||||||||||||||||
| Net tangible book value | $ | 546,448 | $ | 430,163 | $ | 412,989 | $ | 404,209 | $ | 401,078 | $ | 546,448 | $ | 401,078 | ||||||||||||||||
| Efficiency Ratio | ||||||||||||||||||||||||||||||
| Noninterest expense (numerator) | $ | 13,221 | $ | 13,782 | $ | 14,840 | $ | 14,701 | $ | 17,100 | $ | 56,544 | $ | 61,242 | ||||||||||||||||
| Net interest income | $ | 27,567 | $ | 28,773 | $ | 27,745 | $ | 26,860 | $ | 24,157 | $ | 110,945 | $ | 94,635 | ||||||||||||||||
| Noninterest income | 1,481 | 4,918 | 188 | 871 | 3,060 | 7,458 | 7,844 | |||||||||||||||||||||||
| Operating revenue (denominator) | $ | 29,048 | $ | 33,691 | $ | 27,933 | $ | 27,731 | $ | 27,217 | $ | 118,403 | $ | 102,479 | ||||||||||||||||
| Efficiency ratio | 45.51 | % | 40.91 | % | 53.13 | % | 53.01 | % | 62.83 | % | 47.76 | % | 59.76 | % | ||||||||||||||||
| Tangible Assets | ||||||||||||||||||||||||||||||
| Total Assets | $ | 5,704,380 | $ | 5,319,557 | $ | 5,669,417 | $ | 5,391,540 | $ | 5,063,585 | $ | 5,704,380 | $ | 5,063,585 | ||||||||||||||||
| Less: Goodwill | (3,297 | ) | (3,297 | ) | (3,297 | ) | (3,297 | ) | (3,297 | ) | (3,297 | ) | (3,297 | ) | ||||||||||||||||
| Tangible Assets | $ | 5,701,083 | $ | 5,316,260 | $ | 5,666,120 | $ | 5,388,243 | $ | 5,060,288 | $ | 5,701,083 | $ | 5,060,288 | ||||||||||||||||
| Tangible Stockholders' Equity | ||||||||||||||||||||||||||||||
| Total Stockholders' Equity | $ | 549,745 | $ | 433,460 | $ | 416,286 | $ | 407,506 | $ | 404,375 | $ | 549,745 | $ | 404,375 | ||||||||||||||||
| Less: Goodwill | (3,297 | ) | (3,297 | ) | (3,297 | ) | (3,297 | ) | (3,297 | ) | (3,297 | ) | (3,297 | ) | ||||||||||||||||
| Tangible Stockholders' Equity | $ | 546,448 | $ | 430,163 | $ | 412,989 | $ | 404,209 | $ | 401,078 | $ | 546,448 | $ | 401,078 | ||||||||||||||||
| Tangible Stockholders' Equity to Tangible Assets | ||||||||||||||||||||||||||||||
| Tangible stockholders' equity (numerator) | $ | 546,448 | $ | 430,163 | $ | 412,989 | $ | 404,209 | $ | 401,078 | $ | 546,448 | $ | 401,078 | ||||||||||||||||
| Tangible assets (denominator) | $ | 5,701,083 | $ | 5,316,260 | $ | 5,666,120 | $ | 5,388,243 | $ | 5,060,288 | $ | 5,701,083 | $ | 5,060,288 | ||||||||||||||||
| Tangible Stockholders' Equity to Tangible Assets | 9.58 | % | 8.09 | % | 7.29 | % | 7.50 | % | 7.93 | % | 9.58 | % | 7.93 | % | ||||||||||||||||
| Return on Average Tangible Equity | ||||||||||||||||||||||||||||||
| Annualized net income (numerator) | $ | 81,684 | $ | 70,988 | $ | 75,684 | $ | 49,180 | $ | 53,108 | $ | 69,384 | $ | 52,121 | ||||||||||||||||
| Average stockholders' equity | $ | 454,635 | $ | 427,018 | $ | 411,176 | $ | 409,451 | $ | 404,014 | $ | 425,698 | $ | 390,318 | ||||||||||||||||
| Less: Average goodwill | (3,297 | ) | (3,297 | ) | (3,297 | ) | (3,297 | ) | (3,297 | ) | (3,297 | ) | (3,297 | ) | ||||||||||||||||
| Average tangible stockholders' equity (denominator) | $ | 451,338 | $ | 423,721 | $ | 407,879 | $ | 406,154 | $ | 400,717 | $ | 422,401 | $ | 387,021 | ||||||||||||||||
| Return on Average Tangible Equity | 18.10 | % | 16.75 | % | 18.56 | % | 12.11 | % | 13.25 | % | 16.43 | % | 13.47 | % | ||||||||||||||||
| Pro Forma Net Income | ||||||||||||||||||||||||||||||
| Income before provision for income taxes | $ | 14,577 | $ | 18,359 | $ | 19,574 | $ | 12,721 | $ | 13,741 | $ | 65,231 | $ | 53,940 | ||||||||||||||||
| Pro forma provision for income taxes (4) | 6,122 | 7,711 | 8,221 | 5,343 | 5,771 | 27,397 | 22,655 | |||||||||||||||||||||||
| Pro forma net income | $ | 8,455 | $ | 10,648 | $ | 11,353 | $ | 7,378 | $ | 7,970 | $ | 37,834 | $ | 31,285 | ||||||||||||||||
| Pro Forma Ratios | ||||||||||||||||||||||||||||||
| Annualized pro forma net income (numerator) | $ | 33,819 | $ | 42,593 | $ | 45,412 | $ | 29,513 | $ | 31,879 | $ | 37,834 | $ | 31,285 | ||||||||||||||||
| Average assets (denominator) | 5,461,226 | 5,786,035 | 5,517,404 | 5,172,186 | 4,921,585 | 5,485,832 | 4,676,676 | |||||||||||||||||||||||
| Pro forma return on average assets | 0.62 | % | 0.74 | % | 0.82 | % | 0.57 | % | 0.65 | % | 0.69 | % | 0.67 | % | ||||||||||||||||
| Average stockholders' equity (denominator) | 454,635 | 427,018 | 411,176 | 409,451 | 404,014 | 425,698 | 390,318 | |||||||||||||||||||||||
| Pro forma return on average stockholders' equity | 7.44 | % | 9.97 | % | 11.04 | % | 7.21 | % | 7.89 | % | 8.89 | % | 8.02 | % | ||||||||||||||||
| Average tangible stockholders' equity (denominator) | 451,338 | 423,721 | 407,879 | 406,154 | 400,717 | 422,401 | 387,021 | |||||||||||||||||||||||
| Pro forma return on average stockholders' equity | 7.49 | % | 10.05 | % | 11.13 | % | 7.27 | % | 7.96 | % | 8.96 | % | 8.08 | % | ||||||||||||||||
Contact:
Mark A. Severson
Investor Relations
707-921-3655
investorrelations@lbsavings.com