SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark one)
| x | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended March 31, 2004
or
| ¨ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from to
Commission file number 0-18121
MAF BANCORP, INC.
(Exact name of registrant as specified in its charter)
| Delaware | 36-3664868 | |
| (State of Incorporation) | (I.R.S. Employer Identification No.) | |
| 55th Street & Holmes Avenue Clarendon Hills, Illinois |
60514 | |
| (Address of Principal Executive Offices) | (Zip Code) | |
Registrant’s telephone number: (630) 325-7300
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No ¨
Indicate by checkmark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Act). Yes x No ¨
The number of shares outstanding of the issuer’s common stock, par value $.01 per share, was 32,684,947 at May 7, 2004.
MAF BANCORP, INC. AND SUBSIDIARIES
FORM 10-Q
| Page | ||||
| Part I. |
||||
| Item 1. |
||||
| 3 | ||||
| Consolidated Statements of Operations for the Three Months Ended March 31, 2004 and 2003 (unaudited) |
4 | |||
| 5 | ||||
| Consolidated Statements of Cash Flows for the Three Months Ended March 31, 2004 and 2003 (unaudited) |
6 | |||
| Notes to Consolidated Financial Statements (unaudited) |
7 | |||
| Item 2. |
Management’s Discussion and Analysis of Financial Condition and Results of Operations |
11 | ||
| Item 3. |
30 | |||
| Item 4. |
30 | |||
| Part II. |
||||
| Item 1. |
30 | |||
| Item 2. |
Changes in Securities, Use of Proceeds and Issuer Purchases of Equity Securities |
30 | ||
| Item 3. |
31 | |||
| Item 4. |
31 | |||
| Item 5. |
31 | |||
| Item 6. |
31 | |||
| 33 | ||||
2
MAF BANCORP, INC. AND SUBSIDIARIES
Consolidated Statements of Financial Condition
(Dollars in thousands)
(Unaudited)
| March 31, 2004 |
December 31, 2003 | |||||
| Assets | ||||||
| Cash and due from banks |
$ | 134,608 | 144,290 | |||
| Interest-bearing deposits |
58,452 | 57,988 | ||||
| Federal funds sold |
15,502 | 19,684 | ||||
| Total cash and cash equivalents |
208,562 | 221,962 | ||||
| Investment securities available for sale, at fair value |
362,595 | 365,334 | ||||
| Stock in Federal Home Loan Bank of Chicago, at cost |
390,893 | 384,643 | ||||
| Mortgage-backed securities available for sale, at fair value |
940,003 | 971,969 | ||||
| Mortgage-backed securities held to maturity (fair value of $105,856) |
105,139 | — | ||||
| Loans receivable held for sale |
36,696 | 44,511 | ||||
| Loans receivable, net of allowance for losses of $34,437 and $34,555 |
6,417,514 | 6,324,596 | ||||
| Accrued interest receivable |
31,354 | 31,168 | ||||
| Foreclosed real estate |
1,920 | 3,200 | ||||
| Real estate held for development or sale |
32,557 | 32,093 | ||||
| Premises and equipment, net |
129,895 | 122,817 | ||||
| Other assets |
121,279 | 130,615 | ||||
| Goodwill |
262,217 | 262,488 | ||||
| Intangibles |
37,129 | 38,189 | ||||
| $ | 9,077,753 | 8,933,585 | ||||
| Liabilities and Stockholders’ Equity | ||||||
| Liabilities: |
||||||
| Deposits |
$ | 5,618,127 | 5,580,455 | |||
| Borrowed funds |
2,381,838 | 2,299,427 | ||||
| Advances by borrowers for taxes and insurance |
44,404 | 41,149 | ||||
| Accrued expenses and other liabilities |
118,520 | 110,950 | ||||
| Total liabilities |
8,162,889 | 8,031,981 | ||||
| Stockholders’ equity: |
||||||
| Preferred stock, $.01 par value; authorized 5,000,000 shares; none outstanding |
— | — | ||||
| Common stock, $.01 par value; 80,000,000 shares authorized; 33,121,465 and 33,063,853 shares issued; 32,915,327 and 33,063,853 shares outstanding |
331 | 331 | ||||
| Additional paid-in capital |
497,375 | 495,747 | ||||
| Retained earnings, substantially restricted |
418,435 | 402,402 | ||||
| Accumulated other comprehensive income, net of tax |
6,510 | 2,109 | ||||
| Stock in Gain Deferral Plan; 241,900 and 240,879 shares |
1,059 | 1,015 | ||||
| Treasury stock, at cost; 206,138 shares at March 31, 2004 |
(8,846 | ) | — | |||
| Total stockholders’ equity |
914,864 | 901,604 | ||||
| $ | 9,077,753 | 8,933,585 | ||||
See accompanying notes to unaudited consolidated financial statements.
3
MAF BANCORP, INC. AND SUBSIDIARIES
Consolidated Statements of Operations
(Dollars in thousands, except per share data)
(Unaudited)
| Three Months Ended March 31, |
||||||
| 2004 |
2003 |
|||||
| Interest income: |
||||||
| Loans receivable |
$ | 82,908 | 66,985 | |||
| Mortgage-backed securities available for sale |
9,012 | 3,523 | ||||
| Investment securities available for sale |
9,522 | 5,345 | ||||
| Interest-bearing deposits and federal funds sold |
565 | 1,173 | ||||
| Total interest income |
102,007 | 77,026 | ||||
| Interest expense: |
||||||
| Deposits |
17,253 | 16,962 | ||||
| Borrowed funds |
20,725 | 19,009 | ||||
| Total interest expense |
37,978 | 35,971 | ||||
| Net interest income |
64,029 | 41,055 | ||||
| Provision for loan losses |
300 | — | ||||
| Net interest income after provision for loan losses |
63,729 | 41,055 | ||||
| Non-interest income: |
||||||
| Gain (loss) on sale or writedown of: |
||||||
| Loans receivable held for sale |
1,780 | 7,548 | ||||
| Mortgage-backed securities |
489 | 5,352 | ||||
| Investment securities |
2,834 | (5,712 | ) | |||
| Foreclosed real estate |
146 | (69 | ) | |||
| Income from real estate operations |
1,102 | 1,635 | ||||
| Deposit account service charges |
7,856 | 5,439 | ||||
| Loan servicing fee expense, net |
241 | (1,376 | ) | |||
| Valuation recovery of mortgage servicing rights |
555 | — | ||||
| Brokerage commissions |
1,096 | 731 | ||||
| Other |
4,296 | 2,467 | ||||
| Total non-interest income |
20,395 | 16,015 | ||||
| Non-interest expense: |
||||||
| Compensation and benefits |
25,634 | 15,638 | ||||
| Office occupancy and equipment |
6,503 | 3,531 | ||||
| Advertising and promotion |
2,407 | 1,321 | ||||
| Data processing |
2,118 | 973 | ||||
| Other |
9,488 | 4,833 | ||||
| Amortization of core deposit intangibles |
740 | 379 | ||||
| Total non-interest expense |
46,890 | 26,675 | ||||
| Income before income taxes |
37,234 | 30,395 | ||||
| Income tax expense |
12,440 | 11,107 | ||||
| Net income |
$ | 24,794 | 19,288 | |||
| Basic earnings per share |
$ | .75 | .83 | |||
| Diluted earnings per share |
$ | .73 | .81 | |||
See accompanying notes to unaudited consolidated financial statements.
4
MAF BANCORP, INC. AND SUBSIDIARIES
Consolidated Statement of Changes in Stockholders’ Equity
(Dollars in thousands)
(Unaudited)
| Three Months Ended March 31, 2004 |
|||||||||||||||||||
| Common stock |
Additional paid-in capital |
Retained earnings |
Accumulated other comprehensive income |
Stock in gain deferral plan |
Treasury stock |
Total |
|||||||||||||
| Balance at December 31, 2003 |
$ | 331 | 495,747 | 402,402 | 2,109 | 1,015 | — | 901,604 | |||||||||||
| Comprehensive income: |
|||||||||||||||||||
| Net income |
— | — | 24,794 | — | — | — | 24,794 | ||||||||||||
| Other comprehensive income, net of tax: |
|||||||||||||||||||
| Unrealized holding gain during the period |
— | — | — | 6,614 | — | — | 6,614 | ||||||||||||
| Less: reclassification adjustment of gain included in net income |
— | — | — | (2,213 | ) | — | — | (2,213 | ) | ||||||||||
| Total comprehensive income |
— | — | 24,794 | 4,401 | — | — | 29,195 | ||||||||||||
| Exercise of 145,558 stock options, issuing 57,612 new shares and reissuance of 87,946 shares of treasury stock |
— | 1,162 | (1,810 | ) | — | — | 2,551 | 1,903 | |||||||||||
| Tax benefits from stock-related compensation |
— | 466 | — | — | — | — | 466 | ||||||||||||
| Purchase of shares of treasury stock |
— | — | — | — | — | (11,397 | ) | (11,397 | ) | ||||||||||
| Cash dividends declared ($.21 per share) |
— | — | (6,951 | ) | — | — | — | (6,951 | ) | ||||||||||
| Dividends paid to gain deferral plan |
— | — | — | — | 44 | — | 44 | ||||||||||||
| Balance at March 31, 2004 |
$ | 331 | 497,375 | 418,435 | 6,510 | 1,059 | (8,846 | ) | 914,864 | ||||||||||
See accompanying notes to unaudited consolidated financial statements.
5
MAF BANCORP, INC. AND SUBSIDIARIES
Consolidated Statements of Cash Flows
(Dollars in thousands)
(Unaudited)
| Three Months Ended March 31, |
|||||||
| 2004 |
2003 |
||||||
| Operating activities: |
|||||||
| Net income |
$ | 24,794 | 19,288 | ||||
| Adjustments to reconcile net income to net cash provided by operating activities: |
|||||||
| Depreciation and amortization |
3,259 | 1,805 | |||||
| Provision for loan losses |
300 | — | |||||
| FHLB of Chicago stock dividend |
(6,250 | ) | (4,705 | ) | |||
| Deferred income tax (benefit) expense |
7,640 | (3,337 | ) | ||||
| Amortization of core deposit intangibles |
740 | 379 | |||||
| Amortization of premiums, discounts, and deferred loan fees |
(2,719 | ) | 957 | ||||
| Amortization and valuation recovery of mortgage servicing rights |
1,463 | 2,955 | |||||
| Net gain on sale of loans receivable held for sale |
(1,780 | ) | (7,548 | ) | |||
| Net (gain) loss on sale of investment securities and mortgage-backed securities |
(3,322 | ) | 360 | ||||
| Net gain on real estate held for development or sale |
(1,102 | ) | (1,635 | ) | |||
| (Increase) decrease in accrued interest receivable |
(186 | ) | 4,883 | ||||
| Net increase in other assets and liabilities |
2,102 | 27,642 | |||||