Attached files
| file | filename |
|---|---|
| 8-K - PROSPERITY BANCSHARES INC | v162992_8k.htm |
Exhibit
99.1
|
PRESS
RELEASE
|
For
more information contact:
|
|
Prosperity
Bancshares, Inc.®
|
Dan
Rollins
|
|
Prosperity
Bank Plaza
|
President
and Chief Operating Officer
|
|
4295
San Felipe
|
281.269.7199
|
|
Houston,
Texas 77027
|
dan.rollins@prosperitybanktx.com
|
FOR
IMMEDIATE RELEASE
PROSPERITY
BANCSHARES, INC.®
REPORTS
STRONG
THIRD
QUARTER EARNINGS
|
·
|
3Q09 Earnings Per Share of
$0.63 (diluted)
|
|
·
|
3Q09 Net Interest Margin (tax
equivalent) of 4.08%
|
|
·
|
Allowance for Credit Losses to
Total Loans increased to
1.39%
|
|
·
|
Tangible Common Equity Ratio
increased to 5.13%
|
|
·
|
Non-Performing Assets remain
low at 0.29% of Average Earning
Assets
|
HOUSTON, October 16, 2009. Prosperity
Bancshares, Inc.® (NASDAQ: PRSP), the parent company of
Prosperity Bank®, reported net income for the quarter
ended September 30, 2009 of $29.322 million or $0.63 per diluted common share,
an increase in net income of $13.875 million or 89.8%, compared with $15.447
million or $0.33 per diluted common share for the same period in
2008. Earnings for the three months ended September 30, 2008 included
a $9.116 million after-tax ($14.025 million pre-tax) impairment charge on Fannie
Mae and Freddie Mac perpetual preferred securities (“impairment charge on securities” or
“impairment charge”).
Excluding the impairment charge, net income for the quarter ended September 30,
2008 would have been $24.563 million or $0.53 per diluted common
share. Net income for the quarter ended September 30, 2009 increased
$4.759 million or 19.4% when compared to net income for the quarter ended
September 30, 2008 excluding the impairment charge.
“I am
proud to report our team’s outstanding performance during the past quarter,”
commented David Zalman, Chairman and Chief Executive Officer. “Our
bankers are competing well in all of our markets and we continue to believe our
strong asset quality and strong earnings capacity will lead to future
opportunities.”
“We
continued to reduce our exposure to construction and development loans while our
team of professional bankers continued to attract core deposit customers in our
market areas throughout Texas,” continued Zalman. “While Texas is
certainly not immune to the economic ills affecting other parts of the country,
we are encouraged by the resilience of the Texas economy.”
Prosperity’s
management uses certain non−GAAP (generally accepted accounting principles)
financial measures to evaluate its performance. Specifically, Prosperity reviews
tangible book value per share, return on average tangible common equity and the
tangible equity to tangible assets ratio. Prosperity also reviewed its net
income, earnings per share, non-interest expense and related performance ratios
for the three and nine month periods ending September 30, 2008 excluding the
non-recurring impairment charge on Fannie Mae and Freddie Mac perpetual
preferred securities. Prosperity has included in this Earnings
Release information relating to these non-GAAP financial measures for the
applicable periods presented. Please refer to the “Notes to Selected
Financial Data” at the end of this Earnings Release for a reconciliation of
these non-GAAP financial measures.
Page 1 of
22
Results
of operations for the three months ended September 30, 2009
For the
three months ended September 30, 2009, net income was $29.322 million compared
with $15.447 million for the same period in 2008. Net income per
diluted common share was $0.63 for the three months ended September 30, 2009 and
$0.33 for the same period in 2008. Earnings for the three months ended September
30, 2008 included a $9.116 million after-tax ($14.025 million pre-tax)
impairment charge on Fannie Mae and Freddie Mac perpetual preferred securities.
Excluding the impairment charge, net income for the quarter ended September 30,
2008 would have been $24.563 million or $0.53 per diluted common share. Net
income for the quarter ended September 30, 2009 increased $4.759 million or
19.4% when compared to net income for the quarter ended September 30, 2008
excluding the impairment charge. Returns on average assets, average
common equity and average tangible common equity for the three months ended
September 30, 2009 were 1.32%, 8.93% and 29.34%,
respectively. Prosperity’s efficiency ratio (excluding net gains and
losses on the sale of securities and assets and impairment charge on securities)
was 44.46% for the three months ended September 30, 2009.
Net
interest income before provision for credit losses for the quarter ended
September 30, 2009 increased 33.9% to $77.413 million compared with $57.806
million during the same period in 2008. The increase was attributable primarily
to a 35.7% increase in average earning assets primarily due to the assumption of
certain deposits and acquisition of certain assets of Franklin Bank from the
FDIC. The net interest margin on a tax equivalent basis decreased to
4.08% for the three months ended September 30, 2009 compared with 4.15% for the
same period in 2008.
On a
linked quarter basis, the tax equivalent net interest margin increased four
basis points to 4.08% for the three months ended September 30, 2009 from 4.04%
reported for the three months ended June 30, 2009 as a result of multiple
factors, including lower deposit pricing.
Non-interest
income increased $2.119 million or 16.2% to $15.236 million for the three months
ended September 30, 2009 compared with $13.117 million for the same period in
2008. The increase was mainly attributable to an increase in service
charges on deposit accounts related to accounts assumed from the FDIC as part of
the Franklin Bank transaction.
Non-interest
expense decreased $5.029 million or 10.9% to $41.201 million for the third
quarter of 2009 compared with $46.230 million for the third quarter of
2008. The decrease was attributable to a $14.025 million impairment
charge on securities during the three months ended September 30, 2008, partially
offset by increased expenses related to operating the additional banking offices
that were acquired in the Franklin Bank transaction and increased FDIC insurance
premiums. Excluding the impairment charge, non-interest
expense increased $8.996 million or 27.9%, primarily due to increases in staff
and general operating expenses related to the banking centers acquired in the
Franklin Bank transaction and increased FDIC deposit insurance
assessments.
Prosperity’s
FDIC deposit insurance assessments for 2008 were approximately $1.4
million. The expected full year 2009 FDIC deposit insurance
assessment (excluding any one-time assessments) is currently projected to be
between $8.0 million and $9.0 million pre-tax based upon deposit balances at
September 30, 2009. Additionally, the FDIC imposed an emergency
special assessment as of June 30, 2009, which for Prosperity totaled
approximately $4.3 million in pre-tax expense or $0.06 per diluted common share
after tax. Additionally, the FDIC has adopted a proposed rule to
require depository institutions to pre-pay, on December 30, 2009, estimated
quarterly risk-based assessments for the fourth quarter of 2009 and all of 2010,
2011 and 2012. Comments to the proposed rule are due to the FDIC by October 28,
2009 and a final rule will be adopted after that date.
Average
loans increased 4.3% or $141.858 million to $3.431 billion for the quarter ended
September 30, 2009 compared with $3.289 billion for the same period in
2008. Linked quarter average loans decreased 1.2% or $41.388 million
from $3.472 billion at June 30, 2009. Average deposits increased 39.3% or $2.037
billion to $7.224 billion for the quarter ended September 30, 2009 compared with
$5.187 billion for the same period in 2008. Linked quarter average
deposits decreased 0.3% or $22.541 million from $7.246 billion at June 30,
2009.
Loans at
September 30, 2009 were $3.406 billion, an increase of $157,520 million or 4.9%,
compared with $3.249 billion at September 30, 2008. Loans decreased
1.3% or $45.182 million on a linked quarter basis compared with loans of $3.451
billion at June 30, 2009. As reflected in the table below, linked
quarter loans for the third quarter of 2009 were impacted by the loans acquired
from the FDIC as a part of the Franklin Bank transaction in November
2008. Excluding the loans acquired in this transaction, linked
quarter loans decreased 0.8%.
Page 2 of
22
Deposits
at September 30, 2009 were $7.118 billion, an increase of $2.013 billion or
39.4%, compared with $5.105 billion at September 30, 2008. Linked
quarter deposits decreased $139.902 million or 1.9% from $7.258 billion at June
30, 2009. As reflected in the table below, linked quarter deposits
for the third quarter of 2009 were impacted by the deposits assumed from the
FDIC as part of the Franklin Bank transaction. Excluding the deposits
assumed in this transaction, linked quarter deposits increased 1.0% and 9.4%
from September 30, 2008.
|
Balance
Sheet Data (at period end)
|
Sept
30, 2009
|
June
30, 2009
|
Sept
30, 2008
|
|||||||||
|
(In
thousands)
|
(Unaudited)
|
(Unaudited)
|
(Unaudited)
|
|||||||||
|
Loans:
|
||||||||||||
|
Acquired
from FDIC (related to Franklin Bank)
|
$ | 264,319 | $ | 282,733 | $ | 0 | ||||||
|
All
other
|
3,141,818 | 3,168,586 | 3,248,617 | |||||||||
|
Total
Loans
|
$ | 3,406,137 | $ | 3,451,319 | $ | 3,248,617 | ||||||
|
Deposits:
|
||||||||||||
|
Assumed
from FDIC (related to Franklin Bank)
|
$ | 1,533,641 | $ | 1,729,657 | $ | 0 | ||||||
|
All
other
|
5,584,352 | 5,528,238 | 5,104,842 | |||||||||
|
Total
Deposits
|
$ | 7,117,993 | $ | 7,257,895 | $ | 5,104,842 | ||||||
At
September 30, 2009, construction loans totaled $564.106 million, consisting of
approximately $152 million of single family residential construction loans; $77
million of land development loans; $84 million of raw land loans; $104 million
of residential lot loans; $48 million of commercial lot loans; and $99 million
of commercial and other construction loans. This is a decrease of
$49.280 million from construction loans at June 30, 2009.
At
September 30, 2009, Prosperity had $8.957 billion in total assets, $3.406
billion in loans, and $7.118 billion in deposits. Assets, loans and deposits at
September 30, 2009 increased by 32.0%, 4.9% and 39.4%, respectively, compared
with their level at September 30, 2008.
Results
of operations for the nine months ended September 30, 2009
For the
nine months ended September 30, 2009, net income was $81.310 million compared
with $61.822 million for the same period in 2008. Net income per
diluted common share was $1.76 for the nine months ended September 30, 2009
compared with $1.37 for the same period in 2008. Returns on average
assets, average common equity and average tangible common equity for the nine
months ended September 30, 2009 were 1.22%, 8.39% and 28.72%,
respectively. Prosperity’s efficiency ratio was 47.60% for the nine
months ended September 30, 2009.
Net
interest income before provision for credit losses for the nine months ended
September 30, 2009 increased $63.240 million or 38.6%, to $227.012 million
compared with $163.772 million during the same period in 2008. The
increase was attributable primarily to a 40.5% increase in average earning
assets.
Non-interest
income increased $6.524 million or 16.8% to $45.386 million for the nine months
ended September 30, 2009 compared with $38.862 million for the same period in
2008. The increase was mainly attributable to an increase in service
charges on deposit accounts related to accounts assumed from the FDIC as part of
the Franklin Bank transaction and deposit accounts assumed from the 1st Choice
acquisition.
Non-interest
expense increased $23.314 million or 22.0% to $129.524 million for the nine
months ended September 30, 2009 compared with $106.210 million for the same
period in 2008. The increase was attributable to the increased
expenses related to operating the additional banking offices that were acquired
in the Franklin Bank transaction, the 1st Choice
acquisition and FDIC deposit insurance assessments, partially offset by a
$14.025 million pre-tax impairment charge on securities recognized in the third
quarter of 2008.
The
provision for credit losses was $20.275 million for the nine months ended
September 30, 2009 compared to $3.867 million for the nine months ended
September 30, 2008. Net charge offs were $9.932 million for the nine
months ended September 30, 2009 compared to $4.611 million for the nine months
ended September 30, 2008.
Page 3 of
22
Asset
Quality
Non-performing
assets totaled $21.920 million or 0.29% of average earning assets at September
30, 2009 compared with $14.536 million or 0.26% of average earning assets at
September 30, 2008 and $19.587 million or 0.26% of average earnings assets at
June 30, 2009. The allowance for credit losses was 1.39% of total
loans at September 30, 2009 compared with 1.05% at September 30, 2008 and 1.23%
of total loans at June 30, 2009.
|
Non-performing
assets
(In
thousands)
|
Sept
30, 2009
|
June
30, 2009
|
Sept
30, 2008
|
|||||||||||||||||||||
|
Amount
|
#
|
Amount
|
#
|
Amount
|
#
|
|||||||||||||||||||
|
Commercial
|
$ | 920 | 26 | $ | 955 | 28 | $ | 1,600 | 26 | |||||||||||||||
|
Construction
|
10,975 | 40 | 10,969 | 38 | 6,562 | 29 | ||||||||||||||||||
|
1-4
family (including home equity)
|
1,285 | 16 | 1,353 | 22 | 2,962 | 17 | ||||||||||||||||||
|
Commercial
real estate (including multi-family)
|
8,592 | 13 | 6,157 | 9 | 2,886 | 8 | ||||||||||||||||||
|
Agriculture
|
0 | 0 | 0 | 0 | 400 | 2 | ||||||||||||||||||
|
Consumer
|
148 | 13 | 153 | 11 | 126 | 18 | ||||||||||||||||||
|
Other
|
0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||||
|
Total
|
$ | 21,920 | 108 | $ | 19,587 | 108 | $ | 14,536 | 100 | |||||||||||||||
|
Net
Charge-offs
(In
thousands)
|
Three
Months Ended
Sept
30, 2009
|
Three
Months Ended
June
30, 2009
|
Three
Months Ended
Sept
30, 2008
|
|||||||||
|
Commercial
|
$ | 712 | $ | 307 | $ | 223 | ||||||
|
Construction
|
780 | 1,185 | 1,043 | |||||||||
|
1-4
family (including home equity)
|
297 | 510 | 128 | |||||||||
|
Commercial
real estate (including multi-family)
|
215 | 1,091 | (14 | ) | ||||||||
|
Agriculture
|
53 | (1 | ) | 51 | ||||||||
|
Consumer
|
492 | 434 | 373 | |||||||||
|
Total
|
$ | 2,549 | $ | 3,526 | $ | 1,804 | ||||||
The
provision for credit losses was $7.250 million for the three months ended
September 30, 2009 and $1.700 million for the three months ended September 30,
2008. Prosperity’s loan loss reserve model called for increased
provisioning in the third quarter due to increased charge-offs resulting from a
general weakening of the economy. Net charge offs were $2.549 million
for the three months ended September 30, 2009 and $1.804 million for the three
months ended September 30, 2008.
Conference
Call
Prosperity’s
management team will host a conference call on Friday, October 16, 2009 at 10:30
a.m. Eastern Daylight Time (9:30 a.m. Central Daylight Time) to discuss
Prosperity’s third quarter earnings. Individuals and investment professionals
may participate in the call by dialing 1-800-895-4790, the reference code is
PBTX.
Alternatively,
individuals may listen to the live webcast of the presentation by visiting
Prosperity’s website at www.prosperitybanktx.com. The
webcast may be accessed directly from Prosperity’s Home page under News and
Events.
Assumption
of deposits and acquisition of certain assets from the FDIC as receiver for
Franklin Bank, SSB
On
November 7, 2008, Prosperity Bank® paid a
deposit premium of approximately $60.918 million to assume approximately $3.6
billion of deposits, including all uninsured deposits, from the FDIC, acting in
its capacity as receiver for Franklin Bank. The FDIC entered into a
purchase and assumption agreement with Prosperity Bank, which paid a premium to
ensure that all deposits of Franklin Bank, both insured and uninsured, were
transferred to Prosperity Bank®. Under
the terms of the purchase and assumption agreement, Prosperity Bank® acquired
certain assets from the FDIC, including approximately $350 million in US
Treasury and Agency Securities and approximately $350 million in performing
loans. The remaining net proceeds were predominately invested in US
Agency Securities.
While
Franklin Bank operated forty-five (45) full service banking offices, Prosperity
Bank continues to operate thirty-three (33) of these locations and has
consolidated the remainder with other nearby Prosperity locations.
Acquisition
of 1st Choice
Bancorp, Inc.
On June
1, 2008, Prosperity completed its previously announced acquisition of 1st Choice
Bancorp, Inc. and its wholly owned subsidiary, 1st Choice
Bank. 1st Choice
Bancorp, Inc. operated two (2) banking offices in Houston, Texas, with one
location in South Houston and another in the Heights area which was consolidated
with Prosperity’s Heights location and is located in 1st
Choice’s Heights banking office. As of May 31, 2008, 1st Choice
Bancorp reported total assets of approximately $314.9 million, loans of
approximately $192.7 million, deposits of approximately $285.2 million and
stockholders’ equity of approximately $26.4 million.
In
connection with the acquisition, Prosperity issued 1,757,757 shares of its
common stock and paid approximately $18.758 million in cash for all outstanding
shares of 1st Choice Bancorp.
Page 4 of
22
Prosperity
Bancshares, Inc.®
Prosperity
Bancshares, Inc.®, a $9.0
billion Houston, Texas based regional financial holding company, formed in 1983,
operates under a community banking philosophy and seeks to develop broad
customer relationships based on service and convenience. Prosperity offers a
variety of traditional loan and deposit products to its customers, which consist
primarily of small and medium sized businesses and consumers. In addition to
established banking products, Prosperity offers a complete line of services
including: Internet Banking services at http://www.prosperitybanktx.com,
Retail Brokerage Services, MasterMoney Debit Cards, and 24 hour voice response
banking. Prosperity currently operates one hundred fifty-eight (158) full
service banking locations; fifty-one (51) in the Houston area; twenty-seven (27)
in the South Texas area including Corpus Christi and Victoria; twenty-four (24)
in the Dallas/Fort Worth area; twenty (20) in the East Texas area; twenty-seven
(27) in the Central Texas area including Austin and San Antonio; and nine (9) in
the Bryan/College Station area.
|
Bryan/College Station
-
Bryan
Bryan-East
Bryan-North
Caldwell
College
Station
Greens
Prairie
Navasota
Rock
Prairie
Wellborn
Road
Central
Texas Area -
Austin
-
Allandale
Cedar
Park
Congress
183
Lakeway
Liberty
Hill
Northland
Oak
Hill
Parmer
Lane
Research
Blvd
Rollingwood
Slaughter
Lane
Other
Central Texas Locations -
Bastrop
Dime
Box
Dripping
Springs
Elgin
Flatonia
Georgetown
Kingsland
La
Grange
Lexington
New
Braunfels
Round
Rock
San
Antonio
Schulenburg
Smithville
Weimar
Dallas/Fort
Worth Area -
Dallas
-
Abrams
Centre
|
Balch
Springs
Camp
Wisdom
Cedar
Hill
Central
Expressway
Frisco
Frisco-West
Kiest
Preston
Road
Red
Oak
The
Colony
Turtle
Creek
Westmoreland
Fort Worth
-
Haltom
City
Keller
Roanoke
Stockyards
Other
Dallas/Fort Worth
Locations
-
Azle
Ennis
Gainesville
Mesquite
Muenster
Sanger
Waxahachie
East
Texas Area -
Athens
Athens-South
Blooming
Grove
Canton
Carthage
Corsicana
Crockett
Eustace
Grapeland
Gun
Barrel City
Jacksonville
Kerens
Longview
Mount
Vernon
Palestine
Rusk
Seven
Points
Tyler
|
Tyler-University
Winnsboro
Houston
Area -
Houston -
Aldine
Bellaire
Clear
Lake
Copperfield
Cypress
Downtown
Fairfield
Gessner
Gladebrook
Harrisburg
Heights
Highway
6 West
Hillcroft
Little
York
Medical
Center
Memorial
Drive
Pasadena
Pecan
Grove
River
Oaks
Sugar
Land
SW
Medical Center
Tanglewood
Uptown
Waugh
Drive
Westheimer
Woodcreek
Other
Houston Area
Locations -
Angleton
Beaumont
Cinco
Ranch
Cleveland
East
Bernard
Edna
El
Campo
Dayton
Galveston
Groves
Hempstead
Hitchcock
Katy
|
Liberty
Magnolia
Mont
Belvieu
Nederland
Needville
Sweeny
Tomball
Waller
West
Columbia
Wharton
Winnie
Wirt
South
Texas Area -
Corpus
Christi -
Airline
Carmel
Northwest
Saratoga
Water
Street
Other
South Texas
Locations
-
Alice
Aransas
Pass
Bay
City
Beeville
Cuero
Goliad
Gonzales
Hallettsville
Kingsville
Mathis
Padre
Island
Palacios
Pleasanton
Port
Lavaca
Portland
Rockport
Seguin
Sinton
Victoria
Victoria-North
Yoakum
Yorktown
|
“Safe
Harbor” Statement under the Private Securities Litigation Reform Act of 1995:
This release contains, and the remarks by Prosperity’s management on the
conference call may contain, forward-looking statements within the meaning of
the securities laws that are based on current expectations, assumptions,
estimates and projections about Prosperity and its
subsidiaries. These forward-looking statements are not guarantees of
future performance and are subject to risks and uncertainties, many of which are
outside of Prosperity’s control that may cause actual results to differ
materially from those expressed or implied by the forward-looking
statements. These risks and uncertainties include but are not limited
to whether Prosperity can: successfully identify acquisition targets and
integrate the businesses of acquired companies and banks; continue to
sustain its current internal growth rate or total growth rate; provide products
and services that appeal to its customers; continue to have access to debt and
equity capital markets; and achieve its sales objectives. Other risks
include, but are not limited to: the possibility that credit quality could
deteriorate; actions of competitors; changes in laws and regulations (including
changes in governmental interpretations of regulations and changes in accounting
standards); a deterioration or downgrade in the credit quality and credit agency
ratings of the securities in Prosperity’s securities portfolio; customer and
consumer demand, including customer and consumer response to marketing;
effectiveness of spending, investments or programs; fluctuations in the cost and
availability of supply chain resources; economic conditions, including currency
rate fluctuations and interest rate fluctuations; weather; and the stock price
volatility associated with “small-cap” companies. These and various
other factors are discussed in Prosperity’s Annual Report on Form 10-K for the
year ended December 31, 2008 and other reports and statements we have filed with
the SEC. Copies of the SEC filings for Prosperity may be downloaded from the
Internet at no charge from www.prosperitybanktx.com.
Page 5 of
22
Prosperity
Bancshares, Inc.
®
Financial
Highlights
(Dollars
and share amounts in thousands, except per share data)
|
Three
Months Ended
|
Nine
Months Ended
|
|||||||||||||||
|
Sept
30, 2009
|
Sept
30, 2008
|
Sept
30, 2009
|
Sept
30, 2008
|
|||||||||||||
|
Selected
Earnings and Per
|
(Unaudited)
|
(Unaudited)
|
(Unaudited)
|
(Unaudited)
|
||||||||||||
|
Share
Data
|
||||||||||||||||
|
Total
interest income
|
$ | 101,695 | $ | 84,846 | $ | 310,029 | $ | 251,290 | ||||||||
|
Total
interest expense
|
24,282 | 27,040 | 83,017 | 87,518 | ||||||||||||
|
Net
interest income
|
77,413 | 57,806 | 227,012 | 163,772 | ||||||||||||
|
Provision
for credit losses
|
7,250 | 1,700 | 20,275 | 3,867 | ||||||||||||
|
Net
interest income after
|
||||||||||||||||
|
provision
for credit losses
|
70,163 | 56,106 | 206,737 | 159,905 | ||||||||||||
|
Total
non-interest income
|
15,236 | 13,117 | 45,386 | 38,862 | ||||||||||||
|
Total
non-interest expense (A)
|
41,201 | 46,230 | 129,524 | 106,210 | ||||||||||||
|
Net
income before taxes
|
44,198 | 22,993 | 122,599 | 92,557 | ||||||||||||
|
Federal
income taxes
|
14,876 | 7,546 | 41,289 | 30,735 | ||||||||||||
|
Net
income (B)
|
$ | 29,322 | $ | 15,447 | $ | 81,310 | $ | 61,822 | ||||||||
|
Basic
earnings per share (C)
|
$ | 0.64 | $ | 0.34 | $ | 1.76 | $ | 1.37 | ||||||||
|
Diluted
earnings per share (C)
|
$ | 0.63 | $ | 0.33 | $ | 1.76 | $ | 1.37 | ||||||||
|
Period
end shares outstanding
|
46,153 | 46,072 | 46,153 | 46,072 | ||||||||||||
|
Weighted
average shares
|
||||||||||||||||
|
outstanding
(basic)
|
46,125 | 46,065 | 46,106 | 45,038 | ||||||||||||
|
Weighted
average shares
|
||||||||||||||||
|
outstanding
(diluted)
|
46,347 | 46,302 | 46,243 | 45,217 | ||||||||||||
(A) Total
non-interest expense for the three and nine months ended September 30, 2008
includes a $14.025 million pre-tax impairment charge on securities.
(B)
Earnings for the three and nine months ended September 30, 2008 include a
$14.025 million pre-tax, or $9.116 million after-tax, impairment charge on
securities.
(C)
Earnings for the three and nine months ended September 30, 2008 includes
a $14.025 million pre-tax, or $9.116 million after-tax, impairment charge on
securities which resulted in a $0.19 and $0.20 decrease in basic and diluted
earnings per share to $0.34 and $0.33, respectively, for the three months ended
September 30, 2008 and a $0.21 and $0.20 decrease in basic and diluted earnings
per share to $1.37 and $1.37, respectively, for the nine months ended September
30, 2008.
Page 6 of
22
Prosperity
Bancshares, Inc.
®
Financial
Highlights
(Dollars
in thousands)
|
Three
Months Ended
|
Nine
Months Ended
|
|||||||||||||||
|
Sept
30, 2009
|
Sept
30, 2008
|
Sept
30, 2009
|
Sept
30, 2008
|
|||||||||||||
|
Balance
Sheet Averages
|
(Unaudited)
|
(Unaudited)
|
(Unaudited)
|
(Unaudited)
|
||||||||||||
|
Total
loans
|
$ | 3,431,061 | $ | 3,289,203 | 3,477,972 | $ | 3,212,176 | |||||||||
|
Investment
securities
|
4,062,796 | 2,292,571 | 4,019,370 | 2,134,396 | ||||||||||||
|
Federal
funds sold and
|
||||||||||||||||
|
other
temporary
|
||||||||||||||||
|
investments
|
107,008 | 18,854 | 98,782 | 61,264 | ||||||||||||
|
Total
earning assets
|
7,600,865 | 5,600,628 | 7,596,124 | 5,407,836 | ||||||||||||
|
Allowance
for credit losses
|
(43,610 | ) | (33,746 | ) | (40,045 | ) | (32,839 | ) | ||||||||
|
Cash
and due from banks
|
126,659 | 134,849 | 139,017 | 137,177 | ||||||||||||
|
Goodwill
|
875,176 | 811,726 | 875,450 | 785,853 | ||||||||||||
|
Core
deposit intangibles (CDI)
|
39,027 | 46,240 | 39,217 | 44,840 | ||||||||||||
|
Other
real estate
|
13,910 | 6,972 | 11,508 | 8,984 | ||||||||||||
|
Fixed
assets, net
|
150,216 | 124,828 | 141,510 | 124,082 | ||||||||||||
|
Other
assets
|
105,304 | 109,952 | 106,204 | 112,720 | ||||||||||||
|
Total
assets
|
$ | 8,867,547 | $ | 6,801,449 | $ | 8,868,985 | $ | 6,588,653 | ||||||||
|
Non-interest
bearing deposits
|
$ | 1,475,878 | $ | 1,266,924 | $ | 1,490,911 | $ | 1,212,379 | ||||||||
|
Interest
bearing deposits
|
5,747,980 | 3,920,291 | 5,761,958 | 3,842,826 | ||||||||||||
|
Total
deposits
|
7,223,858 | 5,187,215 | 7,252,869 | 5,055,205 | ||||||||||||
|
Securities
sold under
|
||||||||||||||||
|
repurchase
agreements
|
109,961 | 95,533 | 95,488 | 81,390 | ||||||||||||
|
Federal
funds purchased and
|
||||||||||||||||
|
other
borrowings
|
49,539 | 146,172 | 53,733 | 106,572 | ||||||||||||
|
Junior
subordinated
|
||||||||||||||||
|
debentures
|
92,265 | 92,265 | 92,265 | 101,429 | ||||||||||||
|
Other
liabilities
|
77,913 | 55,105 | 82,492 | 61,405 | ||||||||||||
|
Shareholders'
equity(D)
|
1,314,011 | 1,225,159 | 1,292,138 | 1,182,652 | ||||||||||||
|
Total
liabilities and equity
|
$ | 8,867,547 | $ | 6,801,449 | $ | 8,868,985 | $ | 6,588,653 | ||||||||
(D)
Includes $13,735 and ($3,643) in after tax unrealized gains (losses) on
available for sale securities for the three months ending September 30, 2009 and
September 30, 2008, respectively, and $13,767 and ($1,109) for the nine months
ending September 30, 2009 and September 30, 2008,
respectively.
Page 7 of
22
Prosperity
Bancshares, Inc.
®
Financial
Highlights
(Dollars
in thousands)
|
Three
Months Ended
|
Nine
Months Ended
|
|||||||||||||||
|
Sept
30, 2009
|
Sept
30, 2008
|
Sept
30, 2009
|
Sept
30, 2008
|
|||||||||||||
|
Income
Statement Data
|
(Unaudited)
|
(Unaudited)
|
(Unaudited)
|
(Unaudited)
|
||||||||||||
|
Interest
on loans
|
$ | 54,809 | $ | 56,925 | $ | 165,859 | $ | 171,393 | ||||||||
|
Interest
on securities
|
46,812 | 27,834 | 143,990 | 78,473 | ||||||||||||
|
Interest
on federal funds sold
|
||||||||||||||||
|
and
other temporary
|
||||||||||||||||
|
investments
|
74 | 87 | 180 | 1,424 | ||||||||||||
|
Total
interest income
|
101,695 | 84,846 | 310,029 | 251,290 | ||||||||||||
|
Interest
expense - deposits
|
22,694 | 23,874 | 77,772 | 78,029 | ||||||||||||
|
Interest
expense - debentures
|
879 | 1,410 | 2,957 | 4,987 | ||||||||||||
|
Interest
expense - other
|
709 | 1,756 | 2,288 | 4,502 | ||||||||||||
|
Total
interest expense
|
24,282 | 27,040 | 83,017 | 87,518 | ||||||||||||
|
Net
interest income (E)
|
77,413 | 57,806 | 227,012 | 163,772 | ||||||||||||
|
Provision
for credit losses
|
7,250 | 1,700 | 20,275 | 3,867 | ||||||||||||
|
Net
interest income after
|
||||||||||||||||
|
provision
for credit losses
|
70,163 | 56,106 | 206,737 | 159,905 | ||||||||||||
|
Service
charges on
|
||||||||||||||||
|
deposit
accounts
|
13,554 | 11,348 | 38,789 | 32,581 | ||||||||||||
|
Net
(loss) gain on sale of assets
|
(20 | ) | 34 | 277 | 715 | |||||||||||
|
Net
gain (loss) on sale of ORE
|
115 | (210 | ) | 552 | (648 | ) | ||||||||||
|
Brokered
mortgage income
|
59 | 74 | 269 | 296 | ||||||||||||
|
Net
gain on sale of held for
|
||||||||||||||||
|
sale
loans
|
0 | 46 | 0 | 229 | ||||||||||||
|
Other
non-interest income
|
1,528 | 1,825 | 5,499 | 5,689 | ||||||||||||
|
Total
non-interest income
|
15,236 | 13,117 | 45,386 | 38,862 | ||||||||||||
|
Salaries
and benefits (F)
|
21,507 | 17,526 | 64,649 | 50,407 | ||||||||||||
|
CDI
amortization
|
2,479 | 2,562 | 7,635 | 7,513 | ||||||||||||
|
Net
occupancy and equipment
|
3,624 | 3,088 | 11,116 | 8,765 | ||||||||||||
|
Depreciation
|
2,100 | 1,955 | 6,170 | 5,812 | ||||||||||||
|
Data
processing
|
||||||||||||||||
|
and
software amortization
|
1,446 | 1,319 | 5,063 | 3,971 | ||||||||||||
|
Impairment
charge on
|
||||||||||||||||
|
securities
|
0 | 14,025 | 0 | 14,025 | ||||||||||||
|
Other
non-interest expense
|
10,045 | 5,755 | 34,891 | 15,717 | ||||||||||||
|
Total
non-interest expense
|
41,201 | 46,230 | 129,524 | 106,210 | ||||||||||||
|
Net
income before taxes
|
44,198 | 22,993 | 122,599 | 92,557 | ||||||||||||
|
Federal
income taxes
|
14,876 | 7,546 | 41,289 | 30,735 | ||||||||||||
|
Net
income available
|
||||||||||||||||
|
to
common shareholders(G)
|
$ | 29,322 | $ | 15,447 | $ | 81,310 | $ | 61,822 | ||||||||
(E) Net
interest income on a tax equivalent basis would be $78,111 and $58,471 for the
three months ended September 30, 2009 and September 30, 2008, respectively, and
$229,096 and $165,995 for the nine months ended September 30, 2009 and September
30, 2008, respectively.
(F)
Salaries and benefits includes stock-based compensation expense of $267 and $470
for the three months ended September 30, 2009 and September 30, 2008,
respectively, and $887 and $1,111 for the nine months ended September 30, 2009
and September 30, 2008, respectively.
(G)
Earnings for the three and nine months ended September 30, 2008 includes a
$14.025 million pre-tax, or $9.116 million after-tax, impairment charge on
securities.
Page 8 of
22
Prosperity
Bancshares, Inc.®
Financial
Highlights
(Dollars
and share amounts in thousands, except per share data)
|
Three
Months Ended
|
Nine
Months Ended
|
|||||||||||||||
|
Sept
30, 2009
|
Sept
30, 2008
|
Sept
30, 2009
|
Sept
30, 2008
|
|||||||||||||
|
Common
Share and
|
(Unaudited)
|
(Unaudited)
|
(Unaudited)
|
(Unaudited)
|
||||||||||||
|
Other
Data
|
||||||||||||||||
|
Employees
- FTE
|
1,608 | 1,366 | 1,608 | 1,366 | ||||||||||||
|
Book
value per share
|
$ | 28.75 | $ | 26.68 | $ | 28.75 | $ | 26.68 | ||||||||
|
Tangible
book value per share
|
$ | 8.93 | $ | 8.08 | $ | 8.93 | $ | 8.08 | ||||||||
|
Period
end shares outstanding
|
46,153 | 46,072 | 46,153 | 46,072 | ||||||||||||
|
Weighted
average shares
|
||||||||||||||||
|
outstanding
(basic)
|
46,125 | 46,065 | 46,106 | 45,038 | ||||||||||||
|
Weighted
average shares
|
||||||||||||||||
|
outstanding
(diluted)
|
46,347 | 46,302 | 46,243 | 45,217 | ||||||||||||
|
Non-accrual
loans
|
$ | 2,878 | $ | 2,757 | $ | 2,878 | $ | 2,757 | ||||||||
|
Accruing
loans 90 or more
|
||||||||||||||||
|
days
past due
|
5,938 | 4,083 | 5,938 | 4,083 | ||||||||||||
|
Restructured
loans
|
0 | 0 | 0 | 0 | ||||||||||||
|
Total
non-performing loans
|
8,816 | 6,840 | 8,816 | 6,840 | ||||||||||||
|
Repossessed
assets
|
366 | 158 | 366 | 158 | ||||||||||||
|
Other
real estate
|
12,738 | 7,538 | 12,738 | 7,538 | ||||||||||||
|
Total
non-performing assets
|
$ | 21,920 | $ | 14,536 | $ | 21,920 | $ | 14,536 | ||||||||
|
Allowance
for credit losses at
|
||||||||||||||||
|
end
of period
|
$ | 47,312 | $ | 33,981 | $ | 47,312 | $ | 33,981 | ||||||||
|
Net
charge-offs
|
$ | 2,549 | $ | 1,804 | $ | 9,932 | $ | 4,611 | ||||||||
|
Basic
earnings per share (H)
|
$ | 0.64 | $ | 0.34 | $ | 1.76 | $ | 1.37 | ||||||||
|
Diluted
earnings per share (H)
|
$ | 0.63 | $ | 0.33 | $ | 1.76 | $ | 1.37 | ||||||||
(H)
Earnings for the three and nine
months ended September 30, 2008 includes a $14.025 million pre-tax, or $9.116
million after-tax, impairment charge on securities which resulted in a $0.19 and
$0.20 decrease in basic and diluted earnings per share to $0.34 and $0.33,
respectively, for the three months ended September 30, 2008 and a $0.21 and
$0.20 decrease in basic and diluted earnings per share to $1.37 and $1.37,
respectively, for the nine months ended September 30, 2008.
Page 9 of
22
Prosperity
Bancshares, Inc.®
Financial
Highlights
|
Three
Months Ended
|
Nine
Months Ended
|
|||||||||||||||
|
Sept
30, 2009
|
Sept
30, 2008
|
Sept
30, 2009
|
Sept
30, 2008
|
|||||||||||||
|
Performance
Ratios
|
(Unaudited)
|
(Unaudited)
|
(Unaudited)
|
(Unaudited)
|
||||||||||||
|
Return
on average
|
||||||||||||||||
|
assets
(annualized) (I)
|
1.32 | % | 0.91 | % | 1.22 | % | 1.25 | % | ||||||||
|
Return
on average common
|
||||||||||||||||
|
equity
(annualized) (I)
|
8.93 | % | 5.04 | % | 8.39 | % | 6.97 | % | ||||||||
|
Return
on average tangible
|
||||||||||||||||
|
common
equity (annualized)
(I)
|
29.34 | % | 16.83 | % | 28.72 | % | 23.42 | % | ||||||||
|
Net
interest margin
|
||||||||||||||||
|
(tax
equivalent) (annualized)
(J)
|
4.08 | % | 4.15 | % | 4.03 | % | 4.10 | % | ||||||||
|
Efficiency
ratio(K)
|
44.46 | % | 45.43 | % | 47.60 | % | 45.65 | % | ||||||||
|
Asset
Quality Ratios
|
||||||||||||||||
|
Non-performing
assets to
|
||||||||||||||||
|
average
earning assets
|
0.29 | % | 0.26 | % | 0.29 | % | 0.27 | % | ||||||||
|
Non-performing
assets to loans
|
||||||||||||||||
|
and
other real estate
|
0.64 | % | 0.45 | % | 0.64 | % | 0.45 | % | ||||||||
|
Net
charge-offs
|
||||||||||||||||
|
to
average loans
|
0.07 | % | 0.05 | % | 0.29 | % | 0.14 | % | ||||||||
|
Allowance
for credit losses to
|
||||||||||||||||
|
total
loans
|
1.39 | % | 1.05 | % | 1.39 | % | 1.05 | % | ||||||||
|
Common
Stock Market Price
|
||||||||||||||||
|
High
|
$ | 37.36 | $ | 46.48 | $ | 37.36 | $ | 46.48 | ||||||||
|
Low
|
$ | 28.13 | $ | 23.32 | $ | 20.04 | $ | 21.96 | ||||||||
|
Period
end market price
|
$ | 34.79 | $ | 33.99 | $ | 34.79 | $ | 33.99 | ||||||||
(I)
Earnings for the three and nine months ended September 30, 2008 includes a
$14.025 million pre-tax, or $9.116 million after-tax, impairment charge on
securities which resulted in a 53 and 19 basis point decrease in return on
average assets to 0.91% and 1.25%, respectively, a 298 and 103 basis point
decrease in return on average equity to 5.04% and 6.97%, respectively, and a 993
and 345 basis point decrease in return on average tangible common equity to
16.83% and 23.42%, respectively
(J) Net
interest margin for all periods presented is calculated on an actual 365 or
actual 366 day basis.
(K) The
Company revised its efficiency ratio in the fourth quarter 2008 and no longer
excludes gains and losses on the sale of ORE. The efficiency ratio is
calculated by dividing total non-interest expense (excluding provision for
credit losses) by net interest income plus non-interest income (excluding net
gains and losses on the sale of securities and assets and impairment charge on
securities). Prior period amounts have been restated to reflect the current
methodology. Additionally, taxes are not part of this
calculation.
Page 10
of 22
Prosperity
Bancshares, Inc.®
Financial
Highlights
(Dollars
in thousands)
|
Sept
30, 2009
|
June
30, 2009
|
March
31, 2009
|
Dec
31, 2008
|
|||||||||||||||||||||||||||||
|
Loan
Portfolio
|
(Unaudited)
|
(Unaudited)
|
(Unaudited)
|
(Unaudited)
|
||||||||||||||||||||||||||||
|
Commercial
|
$ | 439,848 | 12.92 | % | $ | 461,622 | 13.38 | % | $ | 461,514 | 13.18 | % | $ | 499,143 | 13.99 | % | ||||||||||||||||
|
Construction
|
564,106 | 16.56 | % | 613,386 | 17.77 | % | 643,151 | 18.37 | % | 666,080 | 18.67 | % | ||||||||||||||||||||
|
1-4
family residential
|
692,885 | 20.34 | % | 675,702 | 19.58 | % | 667,392 | 19.06 | % | 668,096 | 18.73 | % | ||||||||||||||||||||
|
Home
equity
|
116,873 | 3.43 | % | 115,029 | 3.33 | % | 112,053 | 3.20 | % | 107,048 | 3.01 | % | ||||||||||||||||||||
|
Commercial
real estate
|
1,336,454 | 39.24 | % | 1,318,489 | 38.20 | % | 1,346,056 | 38.45 | % | 1,343,401 | 37.66 | % | ||||||||||||||||||||
|
Agriculture
|
145,176 | 4.26 | % | 149,515 | 4.33 | % | 144,384 | 4.12 | % | 145,649 | 4.08 | % | ||||||||||||||||||||
|
Consumer
|
110,795 | 3.25 | % | 117,576 | 3.41 | % | 126,750 | 3.62 | % | 137,640 | 3.86 | % | ||||||||||||||||||||
|
Total
Loans
|
$ | 3,406,137 | $ | 3,451,319 | $ | 3,501,300 | $ | 3,567,057 | ||||||||||||||||||||||||
|
Deposit
Types
|
||||||||||||||||||||||||||||||||
|
Non-interest
bearing DDA
|
$ | 1,473,189 | 20.70 | % | $ | 1,476,378 | 20.34 | % | $ | 1,510,005 | 20.95 | % | $ | 1,522,983 | 20.85 | % | ||||||||||||||||
|
Interest
bearing DDA
|
1,066,778 | 14.99 | % | 1,060,965 | 14.62 | % | 1,030,826 | 14.30 | % | 1,082,078 | 14.82 | % | ||||||||||||||||||||
|
Money
Market
|
1,682,345 | 23.63 | % | 1,614,874 | 22.25 | % | 1,495,724 | 20.76 | % | 1,400,673 | 19.18 | % | ||||||||||||||||||||
|
Savings
|
320,078 | 4.50 | % | 325,232 | 4.48 | % | 322,130 | 4.47 | % | 309,938 | 4.24 | % | ||||||||||||||||||||
|
Time
< $100
|
1,289,362 | 18.11 | % | 1,418,375 | 19.54 | % | 1,491,380 | 20.69 | % | 1,577,431 | 21.60 | % | ||||||||||||||||||||
|
Time
> $100
|
1,286,241 | 18.07 | % | 1,362,071 | 18.77 | % | 1,356,814 | 18.83 | % | 1,410,194 | 19.31 | % | ||||||||||||||||||||
|
Total
Deposits
|
$ | 7,117,993 | $ | 7,257,895 | $ | 7,206,879 | $ | 7,303,297 | ||||||||||||||||||||||||
|
Loan
to Deposit Ratio
|
47.9 | % | 47.6 | % | 48.6 | % | 48.8 | % | ||||||||||||||||||||||||
|
Construction
Loans
|
||||||||||||||||||||||||||||||||
|
Single
family residential
construction
|
$ | 152,056 | 26.96 | % | $ | 177,632 | 28.96 | % | $ | 214,034 | 33.28 | % | $ | 237,191 | 35.61 | % | ||||||||||||||||
|
Land
development
|
76,996 | 13.65 | % | 86,363 | 14.08 | % | 91,005 | 14.15 | % | 90,846 | 13.64 | % | ||||||||||||||||||||
|
Raw
land
|
84,384 | 14.96 | % | 96,157 | 15.67 | % | 89,003 | 13.84 | % | 89,120 | 13.38 | % | ||||||||||||||||||||
|
Residential
lots
|
103,565 | 18.36 | % | 101,321 | 16.52 | % | 104,684 | 16.28 | % | 106,869 | 16.04 | % | ||||||||||||||||||||
|
Commercial
lots
|
48,139 | 8.53 | % | 49,614 | 8.09 | % | 37,318 | 5.80 | % | 39,374 | 5.91 | % | ||||||||||||||||||||
|
Commercial
|
||||||||||||||||||||||||||||||||
|
construction
and other
|
98,966 | 17.54 | % | 102,299 | 16.68 | % | 107,107 | 16.65 | % | 102,680 | 15.42 | % | ||||||||||||||||||||
|
Total
Construction Loans
|
$ | 564,106 | $ | 613,386 | $ | 643,151 | $ | 666,080 | ||||||||||||||||||||||||
Page 11
of 22
Prosperity
Bancshares, Inc.®
Financial
Highlights
(Dollars
in thousands)
|
Sept
30, 2009
|
June
30, 2009
|
Mar
31, 2009
|
Dec
31, 2008
|
Sept
30, 2008
|
||||||||||||||||
|
Balance
Sheet Data
(at period
end)
|
(Unaudited)
|
(Unaudited)
|
(Unaudited)
|
(Unaudited)
|
(Unaudited)
|
|||||||||||||||
|
Total
loans
|
$ | 3,406,137 | $ | 3,451,319 | $ | 3,501,300 | $ | 3,567,057 | $ | 3,248,617 | ||||||||||
|
Investment
securities (L)
|
4,255,057 | 3,981,109 | 3,991,200 | 4,160,401 | 2,294,403 | |||||||||||||||
|
Federal
funds sold and other
|
||||||||||||||||||||
|
temporary
investments
|
35,930 | 128,451 | 14,930 | 16,404 | 25,748 | |||||||||||||||
|
Total
earning assets
|
7,697,124 | 7,560,879 | 7,507,430 | 7,743,862 | 5,568,768 | |||||||||||||||
|
Allowance
for credit losses
|
(47,312 | ) | (42,611 | ) | (39,238 | ) | (36,970 | ) | (33,981 | ) | ||||||||||
|
Cash
and due from banks
|
120,932 | 142,860 | 148,938 | 212,335 | 159,386 | |||||||||||||||
|
Goodwill
|
876,958 | 875,434 | 874,356 | 874,654 | 811,916 | |||||||||||||||
|
Core
deposit intangibles
|
37,825 | 40,305 | 42,796 | 38,196 | 44,974 | |||||||||||||||
|
Other
real estate
|
12,738 | 11,101 | 9,134 | 4,450 | 7,538 | |||||||||||||||
|
Fixed
assets, net
|
149,725 | 149,742 | 151,544 | 123,638 | 123,823 | |||||||||||||||
|
Other
assets
|
109,342 | 101,241 | 104,237 | 112,199 | 105,485 | |||||||||||||||
|
Total
assets
|
$ | 8,957,332 | $ | 8,838,951 | $ | 8,799,197 | $ | 9,072,364 | $ | 6,787,909 | ||||||||||
|
Demand
deposits
|
$ | 1,473,189 | $ | 1,476,378 | $ | 1,510,005 | $ | 1,522,983 | $ | 1,263,407 | ||||||||||
|
Interest
bearing deposits
|
5,644,804 | 5,781,517 | 5,696,874 | 5,780,314 | 3,841,435 | |||||||||||||||
|
Total
deposits
|
7,117,993 | 7,257,895 | 7,206,879 | 7,303,297 | 5,104,842 | |||||||||||||||
|
Securities
sold under
|
||||||||||||||||||||
|
repurchase
agreements
|
100,636 | 96,732 | 81,773 | 96,017 | 100,310 | |||||||||||||||
|
Federal
funds purchased and
|
||||||||||||||||||||
|
other
borrowings
|
253,855 | 28,170 | 28,441 | 229,395 | 219,671 | |||||||||||||||
|
Junior
subordinated
|
||||||||||||||||||||
|
debentures
|
92,265 | 92,265 | 92,265 | 92,265 | 92,265 | |||||||||||||||
|
Other
liabilities
|
65,548 | 64,794 | 109,291 | 96,284 | 41,641 | |||||||||||||||
|
Total
liabilities
|
7,630,297 | 7,539,856 | 7,518,649 | 7,817,258 | 5,558,729 | |||||||||||||||
|
Shareholders'
equity (M)
|
1,327,035 | 1,299,095 | 1,280,548 | 1,255,106 | 1,229,180 | |||||||||||||||
|
Total
liabilities and equity
|
$ | 8,957,332 | $ | 8,838,951 | $ | 8,799,197 | $ | 9,072,364 | $ | 6,787,909 | ||||||||||
(L)
Includes $26,688, $20,153, $23,784, $15,158 and $1,220 in unrealized gains on
available for sale securities for the quarterly periods
ending September 30, 2009, June 30, 2009, March 31, 2009, December
31, 2008, and September 30, 2008, respectively.
(M)
Includes $17,347, $13,099, $15,460, $9,853 and $793 in after-tax
unrealized gains on available for sale securities for the quarterly periods
ending September 30, 2009, June 30, 2009, March 31, 2009, December 31, 2008, and
September 30, 2008, respectively.
Page 12
of 22
Prosperity
Bancshares, Inc.®
Financial
Highlights
(Dollars
in thousands)
|
Three
Months Ended
|
||||||||||||||||||||
|
Sept
30, 2009
|
June
30, 2009
|
Mar
31, 2009
|
Dec
31, 2008
|
Sept
30, 2008
|
||||||||||||||||
|
Income
Statement Data
|
(Unaudited)
|
(Unaudited)
|
(Unaudited)
|
(Unaudited)
|
(Unaudited)
|
|||||||||||||||
|
Interest
on loans
|
$ | 54,809 | $ | 55,248 | $ | 55,802 | $ | 56,073 | $ | 56,925 | ||||||||||
|
Interest
on securities
|
46,812 | 47,450 | 49,726 | 39,713 | 27,834 | |||||||||||||||
|
Interest
on federal funds
|
||||||||||||||||||||
|
sold
and other earning
|
||||||||||||||||||||
|
assets
|
74 | 70 | 38 | 802 | 87 | |||||||||||||||
|
Total
interest income
|
101,695 | 102,768 | 105,566 | 96,588 | 84,846 | |||||||||||||||
|
Interest
expense - deposits
|
22,694 | 25,621 | 29,457 | 29,663 | 23,874 | |||||||||||||||
|
Interest
expense - debentures
|
879 | 959 | 1,119 | 1,452 | 1,410 | |||||||||||||||
|
Interest
expense - other
|
709 | 667 | 912 | 1,516 | 1,756 | |||||||||||||||
|
Total
interest expense
|
24,282 | 27,247 | 31,488 | 32,631 | 27,040 | |||||||||||||||
|
Net
interest income
|
77,413 | 75,521 | 74,078 | 63,957 | 57,806 | |||||||||||||||
|
Provision
for credit losses
|
7,250 | 6,900 | 6,125 | 6,000 | 1,700 | |||||||||||||||
|
Net
interest income after
|
||||||||||||||||||||
|
provision
for credit losses
|
70,163 | 68,621 | 67,953 | 57,957 | 56,106 | |||||||||||||||
|
Service
charges on
|
||||||||||||||||||||
|
deposits
accounts
|
13,554 | 12,863 | 12,372 | 13,204 | 11,348 | |||||||||||||||
|
Net
(loss) gain on sale of assets
|
(20 | ) | 200 | 97 | 130 | 34 | ||||||||||||||
|
Net
gain (loss) on sale of
|
||||||||||||||||||||
|
ORE
|
115 | 415 | 22 | (1,684 | ) | (210 | ) | |||||||||||||
|
Brokered
mortgage income
|
59 | 140 | 70 | 34 | 74 | |||||||||||||||
|
Net
gain on sale of held for
|
||||||||||||||||||||
|
sale
loans
|
0 | 0 | 0 | 0 | 46 | |||||||||||||||
|
Other
non-interest income
|
1,528 | 1,515 | 2,456 | 1,824 | 1,825 | |||||||||||||||
|
Total
non-interest income
|
15,236 | 15,133 | 15,017 | 13,508 | 13,117 | |||||||||||||||
|
Salaries
and benefits
|
21,507 | 20,494 | 22,648 | 20,411 | 17,526 | |||||||||||||||
|
CDI
amortization
|
2,479 | 2,492 | 2,664 | 2,284 | 2,562 | |||||||||||||||
|
Net
occupancy and equipment
|
3,624 | 3,514 | 3,978 | 3,704 | 3,088 | |||||||||||||||
|
Depreciation
|
2,100 | 2,069 | 2,001 | 1,854 | 1,955 | |||||||||||||||
|
Data
processing and
|
||||||||||||||||||||
|
software amortization
|
1,446 | 1,562 | 2,055 | 1,609 | 1,319 | |||||||||||||||
|
Impairment
charge on
|
||||||||||||||||||||
|
securities
|
0 | 0 | 0 | 0 | 14,025 | |||||||||||||||
|
Other
non-interest expense
|
10,045 | 14,169 | 10,677 | 7,724 | 5,755 | |||||||||||||||
|
Total
non-interest expense
|
41,201 | 44,300 | 44,023 | 37,586 | 46,230 | |||||||||||||||
|
Net
income before taxes
|
44,198 | 39,454 | 38,947 | 33,879 | 22,993 | |||||||||||||||
|
Federal
income taxes
|
14,876 | 12,944 | 13,469 | 11,194 | 7,546 | |||||||||||||||
|
Net
income available
|
||||||||||||||||||||
|
to
common shareholders(N)
|
$ | 29,322 | $ | 26,510 | $ | 25,478 | $ | 22,685 | $ | 15,447 | ||||||||||
N)
Earnings for the three months ended September 30, 2008 includes a $14.025
million pre-tax, or $9.116 million after-tax, impairment charge on
securities.
Page 13
of 22
Prosperity
Bancshares, Inc.®
Financial
Highlights
|
Comparative
Quarterly
|
Three
Months Ended
|
|||||||||||||||||||
|
Asset
Quality, Performance
|
Sept
30, 2009
|
June
30, 2009
|
Mar
31, 2009
|
Dec
31, 2008
|
Sept
30, 2008
|
|||||||||||||||
|
&
Capital Ratios
|
(Unaudited)
|
(Unaudited)
|
(Unaudited)
|
(Unaudited)
|
(Unaudited)
|
|||||||||||||||
|
Return
on average
|
||||||||||||||||||||
|
assets
(annualized)(O)
|
1.32 | % | 1.20 | % | 1.15 | % | 1.09 | % | 0.91 | % | ||||||||||
|
Return
on average common
|
||||||||||||||||||||
|
equity
(annualized)(O)
|
8.93 | % | 8.18 | % | 8.02 | % | 7.30 | % | 5.04 | % | ||||||||||
|
Return
on average tangible
|
||||||||||||||||||||
|
equity
(annualized)(O)
|
29.34 | % | 27.98 | % | 28.52 | % | 24.89 | % | 16.83 | % | ||||||||||
|
Net
interest margin
|
||||||||||||||||||||
|
(tax
equivalent) (annualized)
|
4.08 | % | 4.04 | % | 3.98 | % | 3.65 | % | 4.15 | % | ||||||||||
|
Employees
- FTE
|
1,608 | 1,634 | 1,684 | 1,734 | 1,366 | |||||||||||||||
|
Efficiency
ratio
|
44.46 | % | 48.98 | % | 49.47 | % | 48.60 | % | 45.43 | % | ||||||||||
|
Non-performing
assets to
|
||||||||||||||||||||
|
average
earning assets
|
0.29 | % | 0.26 | % | 0.16 | % | 0.20 | % | 0.26 | % | ||||||||||
|
Non-performing
assets to loans
|
||||||||||||||||||||
|
and
other real estate
|
0.64 | % | 0.57 | % | 0.36 | % | 0.40 | % | 0.45 | % | ||||||||||
|
Net
charge-offs to
|
||||||||||||||||||||
|
average
loans
|
0.07 | % | 0.10 | % | 0.11 | % | 0.09 | % | 0.05 | % | ||||||||||
|
Allowance
for credit losses to
|
||||||||||||||||||||
|
total
loans
|
1.39 | % | 1.23 | % | 1.12 | % | 1.04 | % | 1.05 | % | ||||||||||
|
Book
value per share
|
$ | 28.75 | $ | 28.17 | $ | 27.78 | $ | 27.24 | $ | 26.68 | ||||||||||
|
Tangible
book value per share
|
$ | 8.93 | $ | 8.31 | $ | 7.88 | $ | 7.43 | $ | 8.08 | ||||||||||
|
Tier
1 risk-based capital
|
11.85 | % | 11.24 | % | 10.53 | % | 9.89 | % | 12.71 | % | ||||||||||
|
Total
risk-based capital
|
13.01 | % | 12.28 | % | 11.48 | % | 10.76 | % | 13.65 | % | ||||||||||
|
Tier
1 leverage capital
|
6.09 | % | 5.81 | % | 5.48 | % | 5.68 | % | 7.75 | % | ||||||||||
|
Tangible
equity to tangible
|
||||||||||||||||||||
|
assets
|
5.13 | % | 4.84 | % | 4.61 | % | 4.19 | % | 6.28 | % | ||||||||||
|
Equity
to assets
|
14.82 | % | 14.70 | % | 14.55 | % | 13.83 | % | 18.11 | % | ||||||||||
(O)
Earnings for the three months ended September 30, 2008 includes a $14.025
million pre-tax, or $9.116 million after-tax, impairment charge on securities,
which resulted in a 53 basis point decrease in return on average assets to
0.91%, a 298 basis point decrease in return on average equity to 5.04% and a 993
basis point decrease in return on average tangible common equity to
16.83%.
Page 14
of 22
Prosperity
Bancshares, Inc.®
Supplemental
Financial Data (Unaudited)
(Dollars
in thousands)
|
Three
Months Ended September 30, 2009
|
||||||||||||
|
YIELD
ANALYSIS
|
Average
|
Interest
Earned
|
Average
|
|||||||||
|
Balance
|
/
Interest Paid
|
Yield/Rate
|
||||||||||
|
Interest
Earning Assets:
|
||||||||||||
|
Loans
|
$ | 3,431,061 | $ | 54,809 | 6.34 | % | ||||||
|
Investment
securities
|
4,062,796 | 46,812 | 4.61 | % | ||||||||
|
Federal
funds sold
|
||||||||||||
|
and
other temporary investments
|
107,008 | 74 | 0.27 | % | ||||||||
|
Total
interest earning assets
|
7,600,865 | $ | 101,695 | 5.31 | % | |||||||
|
Allowance
for credit losses
|
(43,610 | ) | ||||||||||
|
Non-interest
earning assets
|
1,310,292 | |||||||||||
|
Total
assets
|
$ | 8,867,547 | ||||||||||
|
Interest
Bearing Liabilities:
|
||||||||||||
|
Interest
bearing demand deposits
|
$ | 1,092,719 | $ | 2,253 | 0.82 | % | ||||||
|
Savings
and money market deposits
|
1,969,427 | 4,579 | 0.92 | % | ||||||||
|
Certificates
and other time deposits
|
2,685,834 | 15,862 | 2.34 | % | ||||||||
|
Securities
sold under repurchase agreements
|
109,961 | 320 | 1.15 | % | ||||||||
|
Federal
funds purchased and other borrowings
|
49,539 | 389 | 3.12 | % | ||||||||
|
Junior
subordinated debentures
|
92,265 | 879 | 3.78 | % | ||||||||
|
Total
interest bearing liabilities
|
$ | 5,999,745 | $ | 24,282 | 1.61 | % | ||||||
|
Non-interest
bearing liabilities:
|
||||||||||||
|
Non-interest
bearing demand deposits
|
$ | 1,475,878 | ||||||||||
|
Other
liabilities
|
77,913 | |||||||||||
|
Total
liabilities
|
$ | 7,553,536 | ||||||||||
|
Shareholders'
equity
|
$ | 1,314,011 | ||||||||||
|
Total
liabilities and shareholders' equity
|
$ | 8,867,547 | ||||||||||
|
Net
Interest Income & Margin
|
$ | 77,413 | 4.04 | % | ||||||||
|
Net
Interest Income & Margin
|
||||||||||||
|
(tax
equivalent)
|
$ | 78,111 | 4.08 | % | ||||||||
Page 15
of 22
Prosperity
Bancshares, Inc.®
Supplemental
Financial Data (Unaudited)
(Dollars
in thousands)
|
Three
Months Ended September 30, 2008
|
||||||||||||
|
YIELD
ANALYSIS
|
Average
|
Interest
Earned
|
Average
|
|||||||||
|
Balance
|
/
Interest Paid
|
Yield/Rate
|
||||||||||
|
Interest
Earning Assets:
|
||||||||||||
|
Loans
|
$ | 3,289,203 | $ | 56,925 | 6.89 | % | ||||||
|
Investment
securities
|
2,292,571 | 27,834 | 4.86 | % | ||||||||
|
Federal
funds sold
|
||||||||||||
|
and
other temporary investments
|
18,854 | 87 | 1.84 | % | ||||||||
|
Total
interest earning assets
|
5,600,628 | $ | 84,846 | 6.03 | % | |||||||
|
Allowance
for credit losses
|
(33,746 | ) | ||||||||||
|
Non-interest
earning assets
|
1,234,567 | |||||||||||
|
Total
assets
|
$ | 6,801,449 | ||||||||||
|
Interest
Bearing Liabilities:
|
||||||||||||
|
Interest
bearing demand deposits
|
$ | 712,741 | $ | 1,565 | 0.87 | % | ||||||
|
Savings
and money market deposits
|
1,439,838 | 6,783 | 1.87 | % | ||||||||
|
Certificates
and other time deposits
|
1,767,712 | 15,526 | 3.49 | % | ||||||||
|
Securities
sold under repurchase agreements
|
95,533 | 631 | 2.63 | % | ||||||||
|
Federal
funds purchased and other borrowings
|
146,172 | 1,125 | 3.06 | % | ||||||||
|
Junior
subordinated debentures
|
92,265 | 1,410 | 6.08 | % | ||||||||
|
Total
interest bearing liabilities
|
4,254,261 | $ | 27,040 | 2.53 | % | |||||||
|
Non-interest
bearing liabilities:
|
||||||||||||
|
Non-interest
bearing demand deposits
|
1,266,924 | |||||||||||
|
Other
liabilities
|
55,105 | |||||||||||
|
Total
liabilities
|
5,576,290 | |||||||||||
|
Shareholders'
equity
|
1,225,159 | |||||||||||
|
Total
liabilities and shareholders' equity
|
$ | 6,801,449 | ||||||||||
|
Net
Interest Income & Margin
|
$ | 57,806 | 4.11 | % | ||||||||
|
Net
Interest Income & Margin
|
||||||||||||
|
(tax
equivalent)
|
$ | 58,471 | 4.15 | % | ||||||||
Page 16
of 22
Prosperity
Bancshares, Inc.®
Supplemental
Financial Data (Unaudited)
(Dollars
in thousands)
|
Nine
Months Ended September 30, 2009
|
||||||||||||
|
YIELD
ANALYSIS
|
Average
|
Interest
Earned
|
Average
|
|||||||||
|
Balance
|
/
Interest Paid
|
Yield/Rate
|
||||||||||
|
Interest
Earning Assets:
|
||||||||||||
|
Loans
|
$ | 3,477,972 | $ | 165,859 | 6.38 | % | ||||||
|
Investment
securities
|
4,019,370 | 143,990 | 4.78 | % | ||||||||
|
Federal
funds sold
|
||||||||||||
|
and
other temporary investments
|
98,782 | 180 | 0.24 | % | ||||||||
|
Total
interest earning assets
|
7,596,124 | $ | 310,029 | 5.46 | % | |||||||
|
Allowance
for credit losses
|
(40,045 | ) | ||||||||||
|
Non-interest
earning assets
|
1,312,906 | |||||||||||
|
Total
assets
|
$ | 8,868,985 | ||||||||||
|
Interest
Bearing Liabilities:
|
||||||||||||
|
Interest
bearing demand deposits
|
$ | 1,069,884 | $ | 6,557 | 0.82 | % | ||||||
|
Savings
and money market deposits
|
1,884,542 | 15,255 | 1.08 | % | ||||||||
|
Certificates
and other time deposits
|
2,807,532 | 55,960 | 2.66 | % | ||||||||
|
Securities
sold under repurchase agreements
|
95,488 | 948 | 1.33 | % | ||||||||
|
Federal
funds purchased and other borrowings
|
53,733 | 1,340 | 3.33 | % | ||||||||
|
Junior
subordinated debentures
|
92,265 | 2,957 | 4.28 | % | ||||||||
|
Total
interest bearing liabilities
|
6,003,444 | $ | 83,017 | 1.85 | % | |||||||
|
Non-interest
bearing liabilities:
|
||||||||||||
|
Non-interest
bearing demand deposits
|
1,490,911 | |||||||||||
|
Other
liabilities
|
82,492 | |||||||||||
|
Total
liabilities
|
7,567,847 | |||||||||||
|
Shareholders'
equity
|
1,292,138 | |||||||||||
|
Total
liabilities and shareholders' equity
|
$ | 8,868,985 | ||||||||||
|
Net
Interest Income & Margin
|
$ | 227,012 | 4.00 | % | ||||||||
|
Net
Interest Income & Margin
|
||||||||||||
|
(tax
equivalent)
|
$ | 229,096 | 4.03 | % | ||||||||
Page 17
of 22
Prosperity
Bancshares, Inc.®
Supplemental
Financial Data (Unaudited)
(Dollars
in thousands)
|
Nine
Months Ended September 30, 2008
|
||||||||||||
|
YIELD
ANALYSIS
|
Average
|
Interest
Earned
|
Average
|
|||||||||
|
Balance
|
/
Interest Paid
|
Yield/Rate
|
||||||||||
|
Interest
Earning Assets:
|
||||||||||||
|
Loans
|
$ | 3,212,176 | $ | 171,393 | 7.13 | % | ||||||
|
Investment
securities
|
2,134,396 | 78,473 | 4.90 | % | ||||||||
|
Federal
funds sold
|
||||||||||||
|
and
other temporary investments
|
61,264 | 1,424 | 3.10 | % | ||||||||
|
Total
interest earning assets
|
$ | 5,407,836 | $ | 251,290 | 6.21 | % | ||||||
|
Allowance
for credit losses
|
(32,839 | ) | ||||||||||
|
Non-interest
earning assets
|
1,213,656 | |||||||||||
|
Total
assets
|
$ | 6,588,653 | ||||||||||
|
Interest
Bearing Liabilities:
|
||||||||||||
|
Interest
bearing demand deposits
|
$ | 775,730 | $ | 6,338 | 1.09 | % | ||||||
|
Savings
and money market deposits
|
1,354,694 | 20,875 | 2.06 | % | ||||||||
|
Certificates
and other time deposits
|
1,712,402 | 50,816 | 3.96 | % | ||||||||
|
Securities
sold under repurchase agreements
|
81,390 | 1,809 | 2.97 | % | ||||||||
|
Federal
funds purchased and other borrowings
|
106,572 | 2,693 | 3.38 | % | ||||||||
|
Junior
subordinated debentures
|
101,429 | $ | 4,987 | 6.57 | % | |||||||
|
Total
interest bearing liabilities
|
$ | 4,132,217 | $ | 87,518 | 2.83 | % | ||||||
|
Non-interest
bearing liabilities:
|
||||||||||||
|
Non-interest
bearing demand deposits
|
$ | 1,212,379 | ||||||||||
|
Other
liabilities
|
61,405 | |||||||||||
|
Total
liabilities
|
$ | 5,406,001 | ||||||||||
|
Shareholders'
equity
|
1,182,652 | |||||||||||
|
Total
liabilities and shareholders' equity
|
$ | 6,588,653 | ||||||||||
|
Net
Interest Income & Margin
|
$ | 163,772 | 4.05 | % | ||||||||
|
Net
Interest Income & Margin
|
||||||||||||
|
(tax
equivalent)
|
$ | 165,995 | 4.10 | % | ||||||||
Page 18
of 22
Prosperity
Bancshares, Inc.®
Notes
to Selected Financial Data (Unaudited)
(Dollars
in thousands)
Consolidated
Financial Highlights
NOTES
TO SELECTED FINANCIAL DATA
Prosperity’s
management uses certain non−GAAP (generally accepted accounting principles)
financial measures to evaluate its performance. Specifically, Prosperity reviews
tangible book value per share, return on average tangible common equity and the
tangible equity to tangible assets ratio for internal planning and forecasting
purposes. Prosperity also reviewed its net income, earnings per share,
non-interest expense and related performance ratios for the three and nine month
periods ended September 30, 2008 excluding the non-recurring impairment charge
on Fannie Mae and Freddie Mac perpetual preferred securities. Prosperity has
included in this Earnings Release information relating to these non-GAAP
financial measures for the applicable periods presented. Prosperity
believes these non-GAAP financial measures provide information useful to
investors in understanding Prosperity’s financial results and Prosperity
believes that its presentation, together with the accompanying reconciliations,
provides a complete understanding of factors and trends affecting Prosperity’s
business and allows investors to view performance in a manner similar to
management, the entire financial services sector, bank stock analysts and bank
regulators. Further, Prosperity believes that these non-GAAP measures provide
useful information by excluding certain items that may not be indicative of its
core operating earnings and business outlook. These non-GAAP measures
should not be considered a substitute for GAAP basis measures and results and
Prosperity strongly encourages investors to review its consolidated financial
statements in their entirety and not to rely on any single financial measure.
Because non-GAAP financial measures are not standardized, it may not be possible
to compare these financial measures with other companies’ non-GAAP financial
measures having the same or similar names.
Page 19
of 22
Prosperity
Bancshares, Inc.®
Notes
to Selected Financial Data (Unaudited)
(Dollars
and share amounts in thousands)
|
Three
months ended
|
||||||||||||||||||||
|
Sept
30, 2009
|
June
30, 2009
|
Mar
31, 2009
|
Dec
31, 2008
|
Sept
30, 2008
|
||||||||||||||||
|
Return
on average tangible common equity:
|
||||||||||||||||||||
|
Net
income
|
$ | 29,322 | $ | 26,510 | $ | 25,478 | $ | 22,685 | $ | 15,447 | ||||||||||
|
Average
shareholders' equity
|
1,314,011 | 1,295,737 | 1,270,380 | 1,242,491 | 1,225,159 | |||||||||||||||
|
Less:
Average goodwill and other intangible assets
|
(914,203 | ) | (916,754 | ) | (913,010 | ) | (877,985 | ) | (857,966 | ) | ||||||||||
|
Average
tangible shareholders’ equity
|
$ | 399,808 | $ | 378,983 | $ | 357,370 | $ | 364,506 | $ | 367,193 | ||||||||||
|
Return
on average tangible common equity:
|
29.34 | % | 27.98 | % | 28.52 | % | 24.89 | % | 16.83 | % | ||||||||||
|
Tangible
book value per share:
|
||||||||||||||||||||
|
Shareholders’
equity
|
$ | 1,327,035 | $ | 1,299,095 | $ | 1,280,548 | $ | 1,255,106 | $ | 1,229,180 | ||||||||||
|
Less:
Goodwill and other intangible assets
|
(914,783 | ) | (915,739 | ) | (917,152 | ) | (912,850 | ) | (856,890 | ) | ||||||||||
|
Tangible
shareholders’ equity
|
$ | 412,252 | $ | 383,356 | $ | 363,396 | $ | 342,256 | $ | 372,290 | ||||||||||
|
Period
end shares outstanding
|
46,153 | 46,109 | 46,100 | 46,080 | 46,072 | |||||||||||||||
|
Tangible
book value per share:
|
$ | 8.93 | $ | 8.31 | $ | 7.88 | $ | 7.43 | $ | 8.08 | ||||||||||
|
Tangible
equity to tangible assets ratio:
|
||||||||||||||||||||
|
Tangible
shareholders’ equity
|
$ | 412,252 | $ | 383,356 | $ | 363,396 | $ | 342,256 | $ | 372,290 | ||||||||||
|
Total
assets
|
$ | 8,957,332 | $ | 8,838,951 | $ | 8,799,197 | $ | 9,072,364 | $ | 6,787,909 | ||||||||||
|
Less:
Goodwill and other intangible assets
|
(914,783 | ) | (915,739 | ) | (917,152 | ) | (912,850 | ) | (856,890 | ) | ||||||||||
|
Tangible
assets
|
$ | 8,042,549 | $ | 7,923,212 | $ | 7,882,045 | $ | 8,159,514 | $ | 5,931,019 | ||||||||||
|
Tangible
equity to tangible assets ratio:
|
5.13 | % | 4.84 | % | 4.61 | % | 4.19 | % | 6.28 | % | ||||||||||
Page 20
of 22
Prosperity
Bancshares, Inc.®
Notes
to Selected Financial Data (Unaudited)
(Dollars
and share amounts in thousands)
|
Nine
Months Ended
|
||||||||
|
Sept
30, 2009
|
Sept
30, 2008
|
|||||||
|
Return
on average tangible common equity:
|
||||||||
|
Net
income
|
$ | 81,310 | $ | 61,822 | ||||
|
Average
shareholders' equity
|
1,292,138 | 1,225,159 | ||||||
|
Less:
Average goodwill and other intangible assets
|
(914,667 | ) | (857,966 | ) | ||||
|
Average
tangible shareholders’ equity
|
$ | 377,471 | $ | 367,193 | ||||
|
Return
on average tangible common equity:
|
28.72 | % | 22.45 | % | ||||
|
Tangible
book value per share:
|
||||||||
|
Shareholders
equity
|
$ | 1,327,035 | $ | 1,229,180 | ||||
|
Less:
Goodwill and other intangible assets
|
(914,783 | ) | (856,890 | ) | ||||
|
Tangible
shareholders’ equity
|
$ | 412,252 | $ | 372,290 | ||||
|
Period
end shares outstanding
|
46,153 | 46,072 | ||||||
|
Tangible
book value per share:
|
$ | 8.93 | $ | 8.08 | ||||
|
Tangible
equity to tangible assets ratio:
|
||||||||
|
Tangible
shareholders’ equity
|
$ | 412,252 | $ | 372,290 | ||||
|
Total
assets
|
$ | 8,957,332 | $ | 6,787,909 | ||||
|
Less:
Goodwill and other intangible assets
|
(914,783 | ) | (856,890 | ) | ||||
|
Tangible
assets
|
$ | 8,042,549 | $ | 5,931,019 | ||||
|
Tangible
equity to tangible assets ratio:
|
5.13 | % | 6.28 | % | ||||
Page 21
of 22
Prosperity
Bancshares, Inc.®
Notes
to Selected Financial Data (Unaudited)
(Dollars
and share amounts in thousands)
Results
of operations before impairment charge in the third quarter of 2008
The
following results illustrate the effect of the $14.025 million pre-tax ($9.116
million after-tax) impairment charge on Fannie Mae and Freddie Mac perpetual
preferred securities which was recognized in the third quarter of 2008(1):
|
3
Months Ended
|
9
Months Ended
|
|||||||
|
September
30, 2008
|
September
30, 2008
|
|||||||
|
Adjusted
non-interest expense:
|
||||||||
|
Non-interest
expense (GAAP)
|
$ | 46,230 | $ | 106,210 | ||||
|
Less:
Impairment charge on securities
|
(14,025 | ) | (14,025 | ) | ||||
|
Adjusted
non-interest expense
|
$ | 32,205 | $ | 92,185 | ||||
|
Adjusted
net income:
|
||||||||
|
Net
income (GAAP)
|
$ | 15,447 | $ | 61,822 | ||||
|
Add:
Impairment charge on securities
|
14,025 | 14,025 | ||||||
|
Less:
Tax effect of impairment charge on securities
|
(4,909 | ) | (4,909 | ) | ||||
|
Adjusted
net income
|
$ | 24,563 | $ | 70,938 | ||||
|
Adjusted
earnings per share:
|
||||||||
|
Adjusted
net income
|
$ | 24,563 | $ | 70,938 | ||||
|
Weighted
average shares outstanding-basic
|
46,065 | 45,039 | ||||||
|
Adjusted
earnings per share (basic)
|
$ | 0.53 | $ | 1.58 | ||||
|
Weighted
average shares outstanding-diluted
|
46,302 | 45,217 | ||||||
|
Adjusted
earnings per share (diluted)
|
$ | 0.53 | $ | 1.57 | ||||
|
Adjusted
return on average assets:
|
||||||||
|
Adjusted
net income
|
$ | 24,563 | $ | 70,938 | ||||
|
Average
assets
|
$ | 6,801,449 | $ | 6,588,653 | ||||
|
Adjusted
return on average assets
|
1.44 | % | 1.44 | % | ||||
|
Adjusted
return on average common equity:
|
||||||||
|
Adjusted
net income
|
$ | 24,563 | $ | 70,938 | ||||
|
Average
equity
|
$ | 1,225,159 | $ | 1,182,652 | ||||
|
Adjusted
return on average common equity
|
8.02 | % | 8.00 | % | ||||
(1) Total
non-interest income, net interest income and shareholders’ equity were not
affected by the impairment charge
Page 22
of 22