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| 8-K - 8-K - YADKIN FINANCIAL Corp | form8-k3q13.htm |
Yadkin Financial Corporation Announces Third Quarter 2013 Results; Strong EPS Continues in Back Half of the Year
Third Quarter Highlights:
• | Net income available to common shareholders for the third quarter of 2013 was $4.3 million, or $0.30 per diluted share. |
• | The average net interest margin for the quarter was 3.93%, an increase of 3 basis points compared to the prior quarter. |
• | Total loan balances increased $18.7 million compared to the prior quarter, our second consecutive quarter of loan growth. |
• | Nonperforming assets decreased for the fourth consecutive quarter, ending the quarter at 1.15% of total assets. |
• | The Company continues to demonstrate a strong capital position, as evidenced by our Tier 1 leverage, Tier 1 risk-based, and total risk-based capital levels at the Bank. These ratios were 10.9%, 12.9%, and 14.2%, respectively, at September 30, 2013. |
Elkin, NC - October 24, 2013 - Yadkin Financial Corporation (NASDAQ: YDKN), the holding company for Yadkin Bank, announced today financial results for the third quarter ended September 30, 2013. Net income available to common shareholders for the quarter was $4.3 million, or $0.30 per diluted share, compared to net income of $4.2 million, or $0.30 per diluted share, in the second quarter of 2013, and net loss of $81,000, or $0.01 per diluted share, in the third quarter of 2012.
Joe Towell, President and CEO of Yadkin Financial, commented, “We continue to demonstrate that 2013 is about solid profitability at Yadkin. I'm proud of our team for driving results as we work in a very competitive banking environment in the Carolinas. We continued our trends in growing loans, reducing nonperforming assets, and increasing our net interest margin. We are pleased to maintain attractive credit metrics while growing our loan portfolio, primarily in our desired categories of commercial and industrial, owner occupied real estate, and consumer.
Clearly, we have shown that our Board, management team, and employees are laser-focused on our success. We are looking forward to finishing the year strong and moving into 2014 with momentum and opportunity ahead of us. Our core bank continues to show its strengths in terms of quality loan growth and core deposit acquisition. Our mortgage and wealth management divisions continue to drive our non-interest income with their strong performances during 2013, and our focus on enhancing the customer experience has allowed us to better serve our existing customers and attract new customers.
While our industry and our economy continue to improve, we are pleased with our results through three quarters of 2013."
Third Quarter 2013 Financial Highlights
Asset Quality
The Bank's key asset quality metrics continue to be strong as we maintain a clean credit profile. First, our adversely classified items to Tier 1 capital and loan loss reserve ratio has continued to decrease, down to 22.02% at the end of the third quarter. Our nonperforming loans decreased $1.8 million compared to the prior quarter, to $17.9 million at September 30, 2013. In addition, the nonperforming loans to total loans ratio decreased to 1.33% at September 30, 2013, compared to 1.47% at June 30, 2013.
Nonperforming Loan Analysis | ||||||||||||
(Dollars in thousands) | ||||||||||||
September 30, 2013 | June 30, 2013 | |||||||||||
Loan Type | Outstanding Balance | % of Total Loans | Outstanding Balance | % of Total Loans | ||||||||
Construction/land development | $ | 2,917 | 0.22 | % | $ | 3,545 | 0.27 | % | ||||
Residential construction | 548 | 0.04 | % | 553 | 0.04 | % | ||||||
HELOC | 1,373 | 0.10 | % | 2,003 | 0.15 | % | ||||||
1-4 family residential | 3,312 | 0.25 | % | 2,749 | 0.21 | % | ||||||
Commercial real estate | 7,831 | 0.58 | % | 7,739 | 0.58 | % | ||||||
Commercial & industrial | 1,622 | 0.12 | % | 2,743 | 0.21 | % | ||||||
Consumer & other | 271 | 0.02 | % | 366 | 0.03 | % | ||||||
Total | $ | 17,874 | 1.33 | % | $ | 19,698 | 1.47 | % | ||||
Other real estate owned (OREO) totaled $3.0 million at September 30, 2013, a decrease of $823,000 compared to $3.8 million at June 30, 2013. Total nonperforming assets at September 30, 2013 were $20.9 million, or 1.15% of total assets, a decrease of $2.6 million from June 30, 2013.
During the third quarter of 2013, the provision for loan losses was $40,000, a decrease of $15,000 from the second quarter of 2013. This decrease is due to the continued clean credit profile of the Company and the reduction in loans moving to nonperforming and classified status. Total net charge-offs for the third quarter of 2013 were $2.0 million, or 0.58% of average loans on an annualized basis.
At September 30, 2013, the allowance for loan losses was $21.0 million, compared to $22.9 million at June 30, 2013. As a percentage of total loans held-for-investment, the allowance for loan losses was 1.58% in the third quarter of 2013, down from 1.74% in the second quarter of 2013. While credit quality has improved, the reserve remains at a robust level due to continued economic uncertainty and other external factors in our markets. Out of the $21.0 million in total allowance for loan losses at September 30, 2013, the specific allowance for impaired loans accounted for $400,000, down from $2.0 million in the second quarter. The remaining general allowance of $20.6 million attributed to unimpaired loans was down from $20.9 million at the end of the second quarter.
Net Interest Income and Net Interest Margin
Net interest income was essentially flat at $16.1 million compared to the prior quarter. Our net interest margin continued to expand with the quarterly average margin increasing 3 basis points to 3.93%, up from 3.90% at June 30, 2013. This increase in margin is due to our continued loan growth, consistent yield on loans, lower cost of deposits, and slower prepayment speeds in our securities portfolio.
In the third quarter of 2013, we continued to strategically shift our deposit mix and lower our cost of deposits. Core deposits now represent 63.3% of total deposits, our highest percentage in the last eight quarters, as we focus on core deposit growth. As a result of this strategy, our cost of deposits decreased to 0.51% for the quarter as compared to 0.55% in the second quarter of 2013.
Non-Interest Income
Non-interest income decreased $803,000 to $5.4 million in the third quarter compared to $6.2 million in the second quarter of 2013. This decrease is due primarily to a slowdown in the velocity of rate increases during the quarter, which impacts our mortgage income. This was offset by $310,000 in gains as a result of the branch sale executed during July 2013. While our mortgage portfolio is strong, income from this portfolio could moderate over the coming quarters due to anticipated trends in rate movement.
Non-Interest Expense
Non-interest expense decreased $693,000 during the third quarter, down to $14.2 million as compared to $14.8 million in the second quarter. The second quarter of 2013 included expenses related to our rebranding initiative, as well as additional fees incurred as a result of the Company's 1-for-3 reverse stock split, which caused the increase in expense during the prior quarter.
Balance Sheet and Capital
Total assets increased $11.6 million during the third quarter of 2013 as we begin to expand our loan portfolio due to our focus on quality loan growth. Total loans increased $18.7 million as compared to the prior quarter, marking our second consecutive quarter of loan growth. The decrease in total deposits of $31.8 million consisted primarily of a reduction in higher cost time deposits. Core deposits increased $4.4 million compared to the prior quarter, representing our fifth consecutive quarter of core deposit increase.
The Company's capital ratios have strengthened and continue to exceed all regulatory requirements. As of September 30, 2013, the Bank’s leverage ratio, Tier 1 risk-based capital ratio, and total risk-based capital ratio were 10.9%, 12.9%, and 14.2%, respectively. Leverage ratio, Tier 1 risk-based capital ratio, and total risk-based capital ratio were 11.1%, 13.2%, and 14.4% respectively, for the holding company as of September 30, 2013. In addition, the Company's tangible common equity to total tangible assets ratio was 8.2% at the end of the third quarter, compared to 8.0% at June 30, 2013. For capital adequacy purposes, leverage ratio, Tier 1 risk-based capital ratio, and total risk-based capital ratio must be in excess of 5.0%, 6.0%, and 10.0%, respectively, to be considered well-capitalized.
Conference Call
Yadkin Financial Corporation will host a conference call at 10:00 a.m. EST on Thursday, October 24, 2013 to discuss financial results, business highlights, and outlook. The call may be accessed by dialing 877-312-5527 at least 10 minutes prior to the call. A webcast of the call audio may be accessed at http://www.media-server.com/m/p/9y7f997f. A replay of the call will be available until October 30, 2013
by dialing 855-859-2056 or 404-537-3406 and entering Conference ID 87522497.
####
About Yadkin Financial Corporation
Yadkin Financial Corporation is the holding company for Yadkin Bank, a full-service community bank with 33 branches throughout its two regions in North Carolina and South Carolina. The Western Region serves Avery, Watauga, Ashe, Surry, Wilkes, Yadkin, Durham, and Orange Counties. The Southern Region serves Iredell, Mecklenburg, and Union Counties in North Carolina, and Cherokee and York Counties in South Carolina. The Bank provides mortgage-lending services through its mortgage division, Yadkin Mortgage, headquartered in Greensboro, NC. Securities brokerage services are provided by Yadkin Wealth, Inc., a Bank subsidiary with offices located throughout the branch network. Yadkin Financial Corporation’s website is www.yadkinbank.com. Yadkin shares are traded on NASDAQ under the symbol YDKN.
SAFE HARBOR
This news release contains forward-looking statements, as defined by Federal Securities Laws, including statements about financial outlook and business environment. Forward looking statements generally include words such as “expects,” “projects,” “anticipates,” “believes,” “intends,” “estimates,” “strategy,” “plan,” “potential,” “possible” and other similar expressions. These statements are provided to assist in the understanding of future financial performance and such performance involves risks and uncertainties that may cause actual results to differ materially from those anticipated in such statements. Any such statements are based on current expectations and involve a number of risks and uncertainties. For a discussion of some factors that may cause such forward-looking statements to differ materially from actual results, please refer to the section entitled “Forward Looking Statements” on pages 44-45 of Yadkin Financial Corporation’s quarterly report filed on Form 10-Q with the SEC for the quarter ended September 30, 2013 and in the sections entitled “Forward Looking Statements” in quarterly reports filed on Form 10-Q for the quarters ended June 30, 2013, March 31, 2013, and September 30, 2012, and in the section entitled "Risk Factors" in the annual report filed on Form 10-K for the year ended December 31, 2012. Forward-looking statements speak only as of the date they are made, and we undertake no obligation to update or revise forward-looking statements.
For additional information contact:
Joseph H. Towell
President and Chief Executive Officer
(704) 768-1133
joe.towell@yadkinbank.com
Jan H. Hollar
Executive Vice President and Chief Financial Officer
(704) 768-1161
jan.hollar@yadkinbank.com
Yadkin Financial Corporation | |||||||||||||||||||
Consolidated Balance Sheets (Unaudited) | |||||||||||||||||||
(Amounts in thousands except share and per share data) | |||||||||||||||||||
September 30, 2013 | June 30, 2013 | March 31, 2013 | December 31, 2012 (a) | September 30, 2012 | |||||||||||||||
Assets: | |||||||||||||||||||
Cash and due from banks | $ | 32,417 | $ | 28,104 | $ | 22,210 | $ | 36,125 | $ | 26,048 | |||||||||
Federal funds sold | 15 | 50 | 50 | 50 | 50 | ||||||||||||||
Interest-earning deposits with banks | 6,695 | 4,654 | 20,447 | 102,221 | 97,124 | ||||||||||||||
U.S. government agencies | 16,536 | 16,625 | 17,232 | 27,527 | 32,869 | ||||||||||||||
Mortgage-backed securities | 199,492 | 203,173 | 248,030 | 230,894 | 221,806 | ||||||||||||||
State and municipal securities | 109,626 | 110,410 | 115,435 | 84,567 | 54,769 | ||||||||||||||
Common and preferred stocks | 3,036 | 137 | 149 | 132 | 1,112 | ||||||||||||||
Total investment securities | 328,690 | 330,345 | 380,846 | 343,120 | 310,556 | ||||||||||||||
Construction loans | 128,951 | 127,564 | 133,200 | 131,981 | 147,408 | ||||||||||||||
Commercial, financial and other loans | 191,874 | 186,965 | 182,268 | 193,810 | 190,294 | ||||||||||||||
Residential mortgages | 171,747 | 167,784 | 166,565 | 140,931 | 174,728 | ||||||||||||||
Commercial real estate loans | 616,116 | 604,667 | 596,790 | 617,468 | 615,733 | ||||||||||||||
Installment loans | 31,450 | 32,133 | 32,037 | 33,426 | 34,216 | ||||||||||||||
Revolving 1-4 family loans | 193,299 | 195,648 | 193,404 | 191,888 | 196,489 | ||||||||||||||
Total loans | 1,333,437 | 1,314,761 | 1,304,264 | 1,309,504 | 1,358,868 | ||||||||||||||
Allowance for loan losses | (21,014 | ) | (22,924 | ) | (24,492 | ) | (25,149 | ) | (27,231 | ) | |||||||||
Net loans | 1,312,423 | 1,291,837 | 1,279,772 | 1,284,355 | 1,331,637 | ||||||||||||||
Loans held for sale | 12,632 | 22,545 | 18,461 | 27,679 | 24,766 | ||||||||||||||
Accrued interest receivable | 6,339 | 6,546 | 6,502 | 6,376 | 6,229 | ||||||||||||||
Bank premises and equipment | 41,050 | 42,410 | 42,454 | 41,849 | 41,460 | ||||||||||||||
Foreclosed real estate | 2,989 | 3,812 | 5,449 | 8,738 | 22,294 | ||||||||||||||
Non-marketable equity securities at cost | 5,273 | 3,473 | 3,474 | 4,154 | 4,155 | ||||||||||||||
Investment in bank-owned life insurance | 26,888 | 26,736 | 26,587 | 26,433 | 26,274 | ||||||||||||||
Core deposit intangible | 2,133 | 2,301 | 2,475 | 2,653 | 2,914 | ||||||||||||||
Other assets | 35,973 | 39,102 | 37,865 | 39,685 | 26,871 | ||||||||||||||
Total assets | $ | 1,813,517 | $ | 1,801,915 | $ | 1,846,592 | $ | 1,923,438 | $ | 1,920,378 | |||||||||
Liabilities and shareholders' equity: | |||||||||||||||||||
Deposits: | |||||||||||||||||||
Non-interest bearing | $ | 266,951 | $ | 252,618 | $ | 257,388 | $ | 273,896 | $ | 256,402 | |||||||||
NOW, savings and money market accounts | 676,502 | 686,438 | 656,524 | 624,460 | 606,220 | ||||||||||||||
Time certificates: | |||||||||||||||||||
$100 or more | 236,787 | 251,168 | 281,652 | 316,146 | 342,356 | ||||||||||||||
Other | 311,096 | 332,873 | 366,095 | 417,160 | 446,482 | ||||||||||||||
Total deposits | 1,491,336 | 1,523,097 | 1,561,659 | 1,631,662 | 1,651,460 | ||||||||||||||
Borrowings | 131,080 | 91,896 | 99,160 | 105,136 | 102,299 | ||||||||||||||
Accrued expenses and other liabilities | 12,229 | 12,306 | 10,922 | 15,846 | 11,383 | ||||||||||||||
Total liabilities | 1,634,645 | 1,627,299 | 1,671,741 | 1,752,644 | 1,765,142 | ||||||||||||||
Total shareholders' equity | 178,872 | 174,616 | 174,851 | 170,794 | 155,236 | ||||||||||||||
Total liabilities and shareholders' equity | $ | 1,813,517 | $ | 1,801,915 | $ | 1,846,592 | $ | 1,923,438 | $ | 1,920,378 | |||||||||
Period end shares outstanding | 14,383,986 | 14,383,986 | 14,383,884 | 14,383,882 | 6,667,896 | ||||||||||||||
(a) Derived from audited consolidated financial statements
Yadkin Financial Corporation | |||||||||||||||||||
Consolidated Income Statements (Unaudited) | |||||||||||||||||||
Three Months Ended | |||||||||||||||||||
(Amounts in thousands except share and per share data) | |||||||||||||||||||
September 30, 2013 | June 30, 2013 | March 31, 2013 | December 31, 2012 | September 30, 2012 | |||||||||||||||
Interest and fees on loans | $ | 16,849 | $ | 16,950 | $ | 16,679 | $ | 17,338 | $ | 17,735 | |||||||||
Interest on securities | 1,616 | 1,686 | 1,548 | 1,381 | 1,674 | ||||||||||||||
Interest on federal funds sold | — | 3 | 6 | 8 | 9 | ||||||||||||||
Interest-bearing deposits | 5 | 12 | 42 | 66 | 28 | ||||||||||||||
Total interest income | 18,470 | 18,651 | 18,275 | 18,793 | 19,446 | ||||||||||||||
Time deposits of $100 or more | 877 | 1,009 | 1,352 | 1,346 | 1,762 | ||||||||||||||
Other deposits | 1,034 | 1,112 | 1,432 | 2,132 | 2,018 | ||||||||||||||
Borrowed funds | 423 | 409 | 439 | 570 | 477 | ||||||||||||||
Total interest expense | 2,334 | 2,530 | 3,223 | 4,048 | 4,257 | ||||||||||||||
Net interest income | 16,136 | 16,121 | 15,052 | 14,745 | 15,189 | ||||||||||||||
Provision for loan losses | 40 | 55 | 237 | 31,554 | 4,251 | ||||||||||||||
Net interest income after provision for loan losses | 16,096 | 16,066 | 14,815 | (16,809 | ) | 10,938 | |||||||||||||
Non-interest income: | |||||||||||||||||||
Service charges on deposit accounts | 1,336 | 1,317 | 1,269 | 1,398 | 1,319 | ||||||||||||||
Other service fees | 1,259 | 1,401 | 927 | 986 | 857 | ||||||||||||||
Income on investment in bank owned life insurance | 152 | 150 | 153 | 159 | 159 | ||||||||||||||
Mortgage banking activities | 1,713 | 2,546 | 3,288 | 1,448 | 1,599 | ||||||||||||||
Gains on sale of securities | 253 | 272 | 4 | 96 | 1,348 | ||||||||||||||
Other than temporary impairment of investments | — | — | (39 | ) | (50 | ) | — | ||||||||||||
Loss on sale of subsidiary | — | — | (1 | ) | (1,019 | ) | — | ||||||||||||
Loss on sale of loans | — | — | — | (2,132 | ) | (900 | ) | ||||||||||||
Gain on sale of branch | 310 | — | — | — | — | ||||||||||||||
Other | 358 | 498 | 56 | 100 | 283 | ||||||||||||||
Total non-interest income | 5,381 | 6,184 | 5,657 | 986 | 4,665 | ||||||||||||||
Non-interest expense: | |||||||||||||||||||
Salaries and employee benefits | 7,780 | 7,953 | 7,389 | 6,935 | 6,914 | ||||||||||||||
Occupancy and equipment | 2,001 | 1,951 | 1,815 | 1,562 | 1,794 | ||||||||||||||
Printing and supplies | 159 | 150 | 163 | 157 | 168 | ||||||||||||||
Data processing | 374 | 350 | 395 | 447 | 456 | ||||||||||||||
Communication expense | 350 | 338 | 332 | 354 | 314 | ||||||||||||||
Advertising and marketing | 348 | 433 | 256 | 77 | 103 | ||||||||||||||
Amortization of core deposit intangible | 166 | 175 | 178 | 260 | 266 | ||||||||||||||
FDIC assessment expense | 363 | 642 | 592 | 664 | 650 | ||||||||||||||
Attorney fees | 90 | 178 | 90 | 263 | 311 | ||||||||||||||
Other professional fees | 237 | 497 | 476 | 736 | 491 | ||||||||||||||
Loan collection expense | 203 | 201 | 217 | 569 | 69 | ||||||||||||||
(Gain) loss on fixed assets | 154 | — | — | 153 | — | ||||||||||||||
Net cost of operation of other real estate owned | 93 | (174 | ) | (822 | ) | 8,136 | 1,322 | ||||||||||||
Other | 1,832 | 2,149 | 2,134 | 2,395 | 1,934 | ||||||||||||||
Total non-interest expense | 14,150 | 14,843 | 13,215 | 22,708 | 14,792 | ||||||||||||||
Income (loss) before income taxes | 7,327 | 7,407 | 7,257 | (38,531 | ) | 811 | |||||||||||||
Provision for income taxes (benefit) | 2,616 | 2,598 | 2,608 | (14,632 | ) | 54 | |||||||||||||
Net income (loss) | 4,711 | 4,809 | 4,649 | (23,899 | ) | 757 | |||||||||||||
Preferred stock dividend and amortization of preferred stock discount | 421 | 590 | 445 | 1,419 | 838 | ||||||||||||||
Net income (loss) available to common shareholders | $ | 4,290 | $ | 4,219 | $ | 4,204 | $ | (25,318 | ) | $ | (81 | ) | |||||||
Net income (loss) per common share (a) | |||||||||||||||||||
Basic | $ | 0.30 | $ | 0.30 | $ | 0.30 | $ | (3.63 | ) | $ | (0.01 | ) | |||||||
Diluted | $ | 0.30 | $ | 0.30 | $ | 0.30 | $ | (3.63 | ) | $ | (0.01 | ) | |||||||
Weighted average number of shares outstanding | |||||||||||||||||||
Basic | 14,205,705 | 14,205,223 | 14,198,382 | 6,972,526 | 6,463,084 | ||||||||||||||
Diluted | 14,249,152 | 14,223,604 | 14,200,424 | 6,972,526 | 6,463,084 | ||||||||||||||
(a) Net income (loss) per share for prior periods has been adjusted to reflect the 1-for-3 reverse stock split. | |||||||||||||||||||
Yadkin Financial Corporation | |||||||||||||||||||
(unaudited) | |||||||||||||||||||
At or For the Three Months Ended | |||||||||||||||||||
September 30, 2013 | June 30, 2013 | March 31, 2013 | December 31, 2012 | September 30, 2012 | |||||||||||||||
Per Share Data: | |||||||||||||||||||
Basic Earnings (Loss) per Share (8) | $ | 0.30 | $ | 0.30 | $ | 0.30 | $ | (3.63 | ) | $ | (0.01 | ) | |||||||
Diluted Earnings (Loss) per Share (8) | 0.30 | 0.30 | 0.30 | (3.63 | ) | (0.01 | ) | ||||||||||||
Book Value per Share (8) | 10.47 | 10.17 | 10.21 | 9.93 | 16.08 | ||||||||||||||
Selected Performance Ratios: | |||||||||||||||||||
Return on Average Assets (annualized) | 0.95 | % | 0.93 | % | 0.91 | % | (5.15 | )% | (0.02 | )% | |||||||||
Return on Average Equity (annualized) | 9.74 | % | 9.63 | % | 9.94 | % | (53.53 | )% | (0.21 | )% | |||||||||
Net Interest Margin (annualized) | 3.93 | % | 3.90 | % | 3.57 | % | 3.28 | % | 3.37 | % | |||||||||
Net Interest Spread (annualized) | 3.80 | % | 3.76 | % | 3.40 | % | 3.08 | % | 3.19 | % | |||||||||
Non-interest Income as a % of Revenue(6) | 25.05 | % | 27.79 | % | 27.63 | % | (6.23 | )% | 29.90 | % | |||||||||
Non-interest Income as a % of Average Assets | 0.30 | % | 0.34 | % | 0.30 | % | 0.05 | % | 0.24 | % | |||||||||
Non-interest Expense as a % of Average Assets | 0.79 | % | 0.82 | % | 0.70 | % | 1.17 | % | 0.76 | % | |||||||||
Asset Quality: | |||||||||||||||||||
Loans 30-89 Days Past Due (000's) (4) | $ | 4,412 | $ | 6,493 | $ | 6,060 | $ | 14,000 | $ | 13,354 | |||||||||
Loans Over 90 Days Past Due Still Accruing (000's) | — | — | — | — | — | ||||||||||||||
Nonperforming Loans (000's) | 17,874 | 19,698 | 23,712 | 22,817 | 57,053 | ||||||||||||||
Other Real Estate Owned (000's) | 2,989 | 3,812 | 5,449 | 8,738 | 22,294 | ||||||||||||||
Nonperforming Assets (000's) | 20,864 | 23,510 | 29,161 | 31,555 | 79,347 | ||||||||||||||
Accruing/Performing Troubled Debt Restructurings (000's) (5) | 5,599 | 9,162 | 8,579 | 17,667 | 13,929 | ||||||||||||||
Nonperforming Loans to Total Loans | 1.33 | % | 1.47 | % | 1.79 | % | 1.71 | % | 4.12 | % | |||||||||
Nonperforming Assets to Total Assets | 1.15 | % | 1.30 | % | 1.58 | % | 1.64 | % | 4.13 | % | |||||||||
Allowance for Loan Losses to Total Loans | 1.56 | % | 1.71 | % | 1.85 | % | 1.88 | % | 1.97 | % | |||||||||
Allowance for Loan Losses to Total Loans Held for Investment | 1.58 | % | 1.74 | % | 1.88 | % | 1.92 | % | 2.00 | % | |||||||||
Allowance for Loan Losses to Nonperforming Loans | 117.57 | % | 116.38 | % | 103.29 | % | 110.22 | % | 47.73 | % | |||||||||
Net Charge-offs/Recoveries to Average Loans (annualized) | 0.58 | % | 0.49 | % | 0.27 | % | 9.74 | % | 1.66 | % | |||||||||
Capital Ratios: | |||||||||||||||||||
Equity to Total Assets | 9.86 | % | 9.69 | % | 9.47 | % | 8.88 | % | 8.08 | % | |||||||||
Tier 1 Leverage Ratio(1) | 10.88 | % | 10.30 | % | 9.72 | % | 8.92 | % | 8.73 | % | |||||||||
Tier 1 Risk-based Ratio(1) | 12.92 | % | 12.49 | % | 12.23 | % | 11.73 | % | 11.18 | % | |||||||||
Total Risk-based Capital Ratio(1) | 14.17 | % | 13.74 | % | 13.49 | % | 12.99 | % | 12.44 | % | |||||||||
Non-GAAP Disclosures(2): | |||||||||||||||||||
Tangible Book Value per Share | $ | 10.32 | $ | 10.01 | $ | 10.03 | $ | 9.75 | $ | 15.64 | |||||||||
Return on Tangible Equity (annualized) (3) | 9.87 | % | 9.76 | % | 10.09 | % | (54.34 | )% | (0.21 | )% | |||||||||
Tangible Common Equity to Tangible Assets (3) | 8.19 | % | 8.00 | % | 7.83 | % | 7.30 | % | 5.44 | % | |||||||||
Efficiency Ratio (7) | 63.47 | % | 66.55 | % | 66.40 | % | 88.62 | % | 66.46 | % | |||||||||
Notes:
(1) | Tier 1 leverage, Tier 1 risk-based, and Total risk-based ratios are ratios for the bank, Yadkin Bank as reported on Consolidated Reports of Condition and Income for a Bank With Domestic Offices Only - FFIEC 041 |
(2) | Management uses these non-GAAP financial measures because it believes it is useful for evaluating our operations and performance over periods of time, as well as in managing and evaluating our business and in discussions about our |
operations and performance. Management believes these non-GAAP financial measures provides users of our financial information with a meaningful measure for assessing our financial results and credit trends, as well as comparison to financial results for prior periods. These non-GAAP financial measures should not be considered as a substitute for operating results determined in accordance with GAAP and may not be comparable to other similarly titled financial measures used by other companies.
(3) | Tangible Common Equity is the difference of shareholders' equity less preferred shares, less the sum of goodwill and core deposit intangible. Tangible Assets are the difference of total assets less the sum of goodwill and core deposit intangible. |
(4) | Past due numbers exclude loans classified as nonperforming. |
(5) | Nonperforming assets exclude accruing troubled debt restructured loans. |
(6) | Ratio is calculated by taking non-interest income as a percentage of net interest income after provision for loan losses plus total non-interest income. |
(7) | Efficiency ratio is calculated by taking non-interest expense less the amortization of intangibles and gains on sale of OREO, as a percentage of total taxable equivalent net interest income and non-interest income less gains on sale of securities, gains (losses) on sale of loans, gains on sale of branch and other than temporary impairment of investments. |
(8) | Prior period per share amounts have been adjusted to reflect the 1-for-3 reverse stock split. |
Yadkin Financial Corporation | ||||||||||||||||||||||
Average Balance Sheets and Net Interest Income Analysis (Unaudited) | ||||||||||||||||||||||
Three Months Ended September 30, | ||||||||||||||||||||||
2013 | 2012 | |||||||||||||||||||||
(Dollars in Thousands) | ||||||||||||||||||||||
Average | Yield/ | Average | Yield/ | |||||||||||||||||||
Balance | Interest | Rate | Balance | Interest | Rate | |||||||||||||||||
INTEREST EARNING ASSETS | ||||||||||||||||||||||
Total loans (1,2) | $ | 1,334,620 | $ | 16,878 | 5.02 | % | $ | 1,393,717 | $ | 17,770 | 5.07 | % | ||||||||||
Investment securities | 326,990 | 1,969 | 2.39 | % | 355,133 | 1,901 | 2.13 | % | ||||||||||||||
Interest-bearing deposits & federal funds sold | 6,655 | 5 | 0.29 | % | 74,243 | 37 | 0.20 | % | ||||||||||||||
Total average earning assets (1) | 1,668,265 | 18,852 | 4.48 | % | (6) | 1,823,093 | 19,708 | 4.30 | % | (6) | ||||||||||||
Non-interest earning assets | 125,801 | 129,713 | ||||||||||||||||||||
Total average assets | $ | 1,794,066 | $ | 1,952,806 | ||||||||||||||||||
INTEREST BEARING LIABILITIES | ||||||||||||||||||||||
Time deposits | $ | 561,882 | $ | 1,622 | 1.15 | % | $ | 796,695 | $ | 3,449 | 1.72 | % | ||||||||||
Other deposits | 678,071 | 289 | 0.17 | % | 610,286 | 331 | 0.22 | % | ||||||||||||||
Borrowed funds | 110,205 | 423 | 1.52 | % | 113,048 | 477 | 1.68 | % | ||||||||||||||
Total interest bearing liabilities | 1,350,158 | 2,334 | 0.69 | % | (7) | 1,520,029 | 4,257 | 1.11 | % | (7) | ||||||||||||
Non-interest bearing deposits | 257,357 | 249,054 | ||||||||||||||||||||
Other liabilities | 11,840 | 28,542 | ||||||||||||||||||||
Total average liabilities | 1,619,355 | 1,797,625 | ||||||||||||||||||||
Shareholders' equity | 174,711 | 155,181 | ||||||||||||||||||||
Total average liabilities and | ||||||||||||||||||||||
shareholders' equity | $ | 1,794,066 | $ | 1,952,806 | ||||||||||||||||||
NET INTEREST INCOME/ | ||||||||||||||||||||||
YIELD (3,4) | $ | 16,518 | 3.93 | % | $ | 15,451 | 3.37 | % | ||||||||||||||
INTEREST SPREAD (5) | 3.80 | % | 3.19 | % | ||||||||||||||||||
(1) | Yields related to securities and loans exempt from Federal income taxes are stated on a fully tax-equivalent basis, assuming a Federal income tax rate of 35%, reduced by the nondeductible portion of interest expense. |
(2) | The loan average includes loans on which accrual of interest has been discontinued. |
(3) | Net interest income is the difference between income from earning assets and interest expense. |
(4) | Net interest yield is net interest income divided by total average earning assets. |
(5) | Interest spread is the difference between the average interest rate received on earning assets and the average rate paid on interest bearing liabilities. |
(6) | Interest income for 2013 and 2012 includes $64,000 and $55,000, respectively, of accretion for purchase accounting adjustments related to loans acquired in the merger with American Community. |
(7) | Interest expense for 2013 and 2012 includes $9,000 and $67,000, respectively, of accretion for purchase accounting adjustments related to deposits and borrowings acquired in the merger with American Community. |