WESTBURY, N.Y.--(BUSINESS WIRE)--
New York Community Bancorp, Inc. (NYSE: NYB) (the "Company") today
reported second quarter 2009 operating earnings of $89.1 million,
representing a $13.9 million, or 18.6%, increase from the year-earlier
level and a $0.03, or 13.0%, increase in diluted operating earnings per
share to $0.26.(1)
For the six months ended June 30, 2009, the Company reported operating
earnings of $177.7 million, representing a $32.5 million, or 22.3%,
increase from the year-earlier level and a $0.07, or 15.9%, increase in
diluted operating earnings per share to $0.51.(1)
Operating earnings for the three and six months ended June 30, 2009
exclude the impact of an after-tax FDIC special assessment of $8.4
million, or $0.03 per diluted share, and a non-cash after-tax charge of
$24.2 million, or $0.07 per diluted share, on the other-than-temporary
impairment ("OTTI") of certain pooled trust preferred and other debt
securities. Including these after-tax amounts, the Company reported GAAP
earnings of $56.4 million, or $0.16 per diluted share, in the current
second quarter, and $145.1 million, or $0.42 per diluted share, in the
current six-month period.
In contrast, the Company recorded a GAAP loss of $154.8 million, or
$0.47 per diluted share, in the year-earlier second quarter and a GAAP
loss of $82.4 million, or $0.25 per diluted share, in the year-earlier
six months. During the three and six months ended June 30, 2008, the
Company's GAAP earnings were reduced by an after-tax debt repositioning
charge of $199.2 million, or $0.60 per diluted share; a non-cash
after-tax OTTI charge of $29.8 million, or $0.09 per diluted share; and
an after-tax litigation settlement charge of $2.3 million. During that
quarter, the Company completed a highly successful, earnings-accretive
common stock offering which added $339.2 million to stockholders equity
at June 30, 2008.
The Company also reported cash earnings of $88.9 million, or $0.26 per
diluted share, for the current second quarter, and $188.8 million, or
$0.55 per diluted share, for the current six-month period.(2)
Commenting on the Company's second quarter performance, Chairman,
President, and Chief Executive Officer Joseph R. Ficalora stated, "While
the Metro New York region continues to feel the effects of the
recession, we nonetheless produced a strong operating performance in the
second quarter of 2009. Driven by net interest income growth and the
expansion of our margin, operating earnings rose both year-over-year and
linked-quarter, as we continued to capitalize on the steepness of the
yield curve to grow our loans and reduce our cost of funds. At $0.26 per
diluted share, our operating earnings were consistent with the
trailing-quarter level, while reflecting a year-over-year increase of
13%.(1)
"The highlight of the quarter was the expansion of our margin to its
highest level since the first quarter of 2005. At 3.06%, the margin was
17 basis points wider than the trailing-quarter measure and 52 basis
points wider than the adjusted measure we reported for the second
quarter of 2008.(3) The expansion was consistent with our
expectations, and reflects our ability to generate loan growth at higher
spreads over the past four quarters, as well as our ability to
strategically manage our funding costs.
"In addition, our operating efficiency ratio improved to 36.72% from
40.14% in the year-ago quarter, despite the increase in ongoing FDIC
insurance premiums.(4) Including the $14.0 million
special assessment, FDIC insurance premiums added $28.1 million to our
year-to-date GAAP operating expenses, exceeding the year-earlier
six-month amount by $26.8 million, and reducing our diluted GAAP
earnings per share by $0.05 in the first half of this year."
Board of Directors Declares $0.25 per
Share Dividend, Payable on August 18th
"We also maintained a solid tangible capital position at the close of
the quarter, with tangible stockholders' equity representing 5.83% of
tangible assets, absent the impact of accumulated other comprehensive
loss.(6)
"In view of our continued capital strength, and the strength of our cash
earnings, the Board of Directors last night declared a quarterly cash
dividend of $0.25 per share, payable on August 18th to shareholders of
record at the close of business on August 7, 2009.
"As in the past, we continued to see a significant difference between
the level of loans requiring classification as non-performing due to
non-payment, and the level of loans we needed to charge off. That
difference is largely indicative of the nature of our underwriting
standards, the people we partner with, and our determination to be paid
the maximum collateral value.
"Despite a 19% linked-quarter decline in loans 30 to 89 days past due to
$163 million, non-performing loans represented $340 million, or 1.49%,
of total loans at the end of June. Importantly, other real estate owned
added less than $2 million to non-performing assets, which represented
$342 million, or 1.04%, of total assets at quarter-end. An
extraordinarily large charge of $5.2 million on an out-of-market
multi-family loan brought the quarter's net charge-offs to $9.2 million,
which represented a modest 0.04% of average loans. By comparison, in the
six years of the last credit cycle turn, from 1987 to 1992, our total
net charge-offs represented 0.07% of average assets, while our ratio of
non-performing loans to total loans reached as high as 2.48%.
"While we would expect our loan portfolio to continue to reflect the
impact of the evolving credit cycle, we also expect that the level of
net charge-offs will continue to compare favorably with the level of
non-performing assets, and that our measures of asset quality will
continue to compare well with those reported by our industry as a whole.
In view of the increase in non-performing assets and charge-offs, we
recorded a $12.0 million provision for loan losses in the current second
quarter, which increased the loan loss allowance to $98.1 million at the
end of June.
"These continue to be very challenging times for our customers, and our
investors, yet we continue to be confident in our ability to not only
withstand the pressures of the credit cycle, but to continue producing
strong operating earnings and grow the Company in the quarters ahead,"
Mr. Ficalora said.
Balance Sheet Summary at June 30, 2009
Assets totaled $32.9 billion at the close of the second quarter,
representing a $393.2 million increase over the past six months.
Loans
Loans represented $22.8 billion, or 69.3%, of total assets at the close
of the second quarter, a $585.0 million increase from the balance
recorded at December 31, 2008. Multi-family loans accounted for the bulk
of the increase, having risen $497.5 million to $16.2 billion, which
represented 71.2% of loans outstanding and an annualized growth rate of
6.3%. Commercial real estate ("CRE") loans rose $222.1 million during
this time, to $4.8 billion, representing 21.0% of total loans at
quarter-end.
At June 30, 2009, the average multi-family loan had a principal balance
of $3.9 million and the average CRE loan had a principal balance of $2.7
million. The multi-family and CRE loan portfolios had average
loan-to-value ratios ("LTVs") of 61.1% and 54.3%, respectively, at the
close of the quarter, and expected weighted average lives of 3.7 and 3.4
years, respectively.
The remainder of the loan portfolio at June 30, 2009 consisted of one-
to four-family loans, which declined by $25.9 million from the year-end
2008 balance to $240.5 million; acquisition, development, and
construction ("ADC") loans, which declined by $50.4 million to $726.1
million; and other loans, primarily consisting of commercial and
industrial ("C&I") loans, which declined by $58.4 million to $814.3
million. The respective six-month declines were consistent with the
Company's strategy of reducing these segments of the loan portfolio
during a period of economic stress.
The growth of the loan portfolio was the net effect of originations
totaling $1.7 billion and repayments totaling $1.1 billion over the past
six months. Included in the respective amounts were second quarter
originations of $1.0 billion and repayments of $527.1 million.
Multi-family and CRE loans accounted for $870.9 million and $366.8
million of the Company's year-to-date originations, including $553.1
million and $231.4 million, respectively, of loans produced in the
second quarter of the year.
At the present time, the Company has a pipeline of approximately $942
million, including approximately $679 million of multi-family loans.
Asset Quality
Including second quarter net charge-offs of $9.2 million, the Company
recorded net charge-offs of $14.3 million in the first six months of
2009. The three- and six-month amounts were respectively equivalent to
0.04% and 0.06% of average loans outstanding, well below the respective
averages of 0.73% and 1.46% for the SNL Bank and Thrift Index to date. (5)
While second quarter net charge-offs were up both year-over-year and
linked-quarter, the bulk of the increase was attributable to a single
loan in the amount of $5.2 million secured by a multi-family building,
geographically distant from the Company's primary multi-family niche in
Metropolitan New York. C&I and other consumer loans accounted for $2.0
million and $256,000, respectively, of second quarter 2009 net
charge-offs. There were no CRE or ADC loans charged off in the quarter,
and no CRE loans have been charged off year-to-date.
Non-performing assets rose to $341.6 million at the end of June,
representing 1.04% of total assets, as compared to $176.8 million, or
0.55% of total assets, at the end of March. Although the balance of
other real estate owned was unchanged at $1.5 million, non-performing
loans rose $164.8 million over the course of the quarter to $340.2
million at June 30, 2009. Multi-family loans accounted for $159.3
million of the second quarter-end total, with ADC loans accounting for
$79.6 million and CRE loans accounting for $67.7 million of the total
amount.
While the balance of non-performing loans rose substantially during the
quarter, the balance of loans 30 to 89 days delinquent declined to
$163.2 million, representing a linked-quarter reduction of $38.3
million, or 19.0%.
The significant difference between the volume of non-performing loans
and the volume of net charge-offs has been a historical attribute of the
Company. Among the factors that have contributed to this difference are
the Company's underwriting policies, and the active involvement of those
Directors who serve on the Board's Mortgage and Real Estate and Credit
Committees in the loan review process, together with executive officers.
In view of the severity of the current credit cycle, the Company
recorded a $12.0 million provision for loan losses in the current second
quarter, exceeding the year-earlier loan loss provision by $10.3 million
and bringing the six-month 2009 total to $18.0 million. Reflecting the
loan loss provisions and net charge-offs recorded year-to-date, the
allowance for loan losses rose from $94.4 million at the end of December
to $98.1 million at the end of June.
Securities
Securities represented $5.6 billion, or 17.2%, of total assets at the
close of the second quarter, down from $5.9 billion, representing 18.2%
of total assets, at December 31, 2008. Government-sponsored enterprise
("GSE") securities represented approximately 90% of the securities
portfolio at the end of June.
The six-month decline in securities reflects a $101.2 million reduction
in held-to-maturity securities and a $161.4 million decline in
available-for-sale securities. Held-to-maturity securities represented
$4.8 billion, or 84.9%, of total securities at the close of the second
quarter, and available-for-sale securities represented the remaining
$849.1 million, or 15.1%.
Although the reduction in securities was primarily due to repayments, it
also reflects the Company's second quarter 2009 assessment of certain
pooled trust preferred and other debt securities as
other-than-temporarily impaired, due to the deferral of interest
payments on the underlying collateral. The recognition of the OTTI
contributed to an $8.3 million, or 25.6%, decline in the after-tax net
unrealized loss on securities recorded at the end of the quarter from
the $32.5 million recorded at year-end 2008.
Funding Sources
In addition to the cash flows generated through loan and securities
repayments, the Company's funding primarily stems from deposits and
borrowed funds. Depending on the availability and attractiveness of
wholesale funding sources, the Company typically has refrained from
pricing its retail deposits at the higher end of the market in order to
contain its funding costs. While the Company has the capacity to
increase deposits through its extensive branch network, it opted to
utilize wholesale borrowings to enhance its liquidity during the quarter
when such funding was more attractively priced.
At June 30, 2009, deposits totaled $14.4 billion, down $21.6 million
from the balance recorded at December 31, 2008. Although NOW and money
market accounts and savings accounts rose $605.5 million and $124.6
million, respectively, to $4.4 billion and $2.8 billion, these increases
were exceeded by a $750.3 million decline in certificates of deposit
("CDs") to $6.0 billion, together with a $1.3 million drop in
non-interest-bearing accounts to $1.1 billion over the six-month period.
Borrowed funds totaled $14.1 billion at the close of the second quarter
and were up $562.3 million from the year-end 2008 amount. The increase
was largely attributable to a $562.5 million rise in wholesale
borrowings to $12.9 billion, as the Company continued to utilize
lower-cost Federal Home Loan Bank of New York ("FHLB-NY") advances to
pay down a portion of its brokered CDs.
Stockholders' Equity
Stockholders' equity totaled $4.2 billion at the close of the second
quarter, down $8.6 million from the balance recorded at December 31,
2008. The June 30, 2009 amount was equivalent to 12.81% of total assets
and a book value per share of $12.21, as compared to the respective
year-end measures of 13.00% and $12.25.
The Company calculates book value per share by excluding the number of
unallocated Employee Stock Ownership Plan ("ESOP") shares from the
number of shares outstanding. At June 30, 2009 and December 31, 2008,
the Company's book value per share was calculated on the basis of
344,742,899 and 344,353,808 shares, respectively.
Tangible stockholders' equity equaled $1.7 billion at the close of the
second quarter, a $2.6 million increase from the balance at year-end
2008. The June 30, 2009 amount was equivalent to 5.59% of tangible
assets, down seven basis points from the measure recorded at December
31st. Excluding AOCL from the calculation, the Company's adjusted
tangible stockholders' equity represented 5.83% of tangible assets at
the close of the second quarter, as compared to 5.94% at December 31,
2008. The modest decline in these tangible capital measures was
attributable to the OTTI charge and the FDIC special assessment recorded
in the second quarter of 2009.(6)
The Company's subsidiary banks also reported solid levels of capital at
the close of the second quarter, and continued to exceed the
requirements for classification as "well capitalized" institutions under
the FDIC Improvement Act. At June 30, 2009, New York Community Bank had
a leverage capital ratio of 7.00%, exceeding the minimum required for
"well capitalized" classification by 200 basis points. At the same time,
New York Commercial Bank had a leverage capital ratio of 12.19%,
exceeding the minimum required for such classification by 719 basis
points.
Earnings Summary for the Three Months
Ended June 30, 2009
The Company generated GAAP earnings of $56.4 million in the current
second quarter, as compared to $88.7 million in the trailing quarter and
a loss of $154.8 million in the three months ended June 30, 2008. The
Company's second quarter 2009 earnings were reduced by an after-tax FDIC
special assessment of $8.4 million and by a non-cash after-tax OTTI
charge of $24.2 million.
In the second quarter of 2008, the Company's GAAP earnings were reduced
by an after-tax debt repositioning charge of $199.2 million, a non-cash
after-tax OTTI charge of $29.8 million, and an after-tax litigation
settlement charge of $2.3 million. On a pre-tax basis, the debt
repositioning charge equaled $325.0 million, including $285.4 million
that was recorded in non-interest expense in connection with the
prepayment of wholesale borrowings totaling $3.3 billion and $39.6
million that was recorded in interest expense in connection with the
prepayment of $700.0 million in wholesale borrowings.
Excluding these items, the Company reported operating earnings of $89.1
million, or $0.26 per diluted share, in the current second quarter, up
from operating earnings of $75.1 million, or $0.23 per diluted share, in
the second quarter of 2008.(1) While the growth of the
Company's second quarter 2009 operating earnings was driven by the
expansion of its net interest margin and higher net interest income, it
was tempered by a $12.0 million loan loss provision and by the reversal
of interest income on loans that transitioned to non-accrual status
during the three-month period. In the first quarter of 2009, the
Company's operating earnings were identical to its GAAP earnings.
Net Interest Income
The Company recorded net interest income of $217.6 million in the
current second quarter, as compared to $130.6 million in the
year-earlier three months. The Company's second quarter 2008 net
interest income was reduced by the impact of the $39.6 million debt
repositioning charge recorded in interest expense in connection with the
strategic prepayment of $700.0 million of wholesale borrowings.
Excluding the $39.6 million charge, the Company's second quarter 2008
net interest income would have equaled $170.2 million. (3)
Absent the second quarter 2008 debt repositioning charge, the
year-over-year increase in second quarter 2009 net interest income was
driven by an increase in average loans outstanding and a continuing
decline in the cost of funds. During the quarter, the Company continued
to take advantage of the steeper yield curve and a decline in
competition to increase its loan production, while also capitalizing on
the historically low level of short-term interest rates to reduce its
funding costs.
Interest income rose $8.4 million year-over-year, to $401.7 million, as
a $1.7 billion, or 6.5%, increase in the average balance of
interest-earning assets to $28.4 billion exceeded the impact of a
25-basis point decline in the average yield to 5.65%. While the average
yield on loans fell 32 basis points year-over-year to 5.75%, the average
balance of such assets rose $1.9 billion to $22.4 billion; as a result,
the interest income from loans rose $11.2 million to $321.6 million in
the second quarter of 2009. The increase in the interest income produced
by loans occurred despite a $6.1 million decline in prepayment penalty
income, as the economic environment continued to inhibit refinancing
activity. Prepayment penalty income added four basis points to the
average yield on loans in the current second quarter, down from 16 basis
points in the second quarter of 2008. The average yield on loans was
also reduced by the reversal of interest on loans that moved to
non-accrual status during the current three-month period.
The higher interest income produced by loans was modestly tempered by a
$2.8 million decline in the interest income produced by securities and
money market investments, as the average balance of such assets fell
$178.9 million to $6.0 billion and the average yield declined three
basis points to 5.31%.
Excluding the debt repositioning charge in the year-earlier second
quarter, interest expense declined by $39.0 million to $184.1 million,
as the impact of a $1.9 billion increase in average interest-bearing
liabilities to $26.7 billion was exceeded by the benefit of an 85-basis
point decline in the average cost of funds to 2.76%.(3) The
reduction in the cost of funds reflects the decline in the federal funds
rate over the past four quarters, as well as the Company's strategic
replacement of higher-cost retail and wholesale deposits with lower-cost
retail deposits and wholesale borrowings. Including the debt
repositioning charge, interest expense totaled $262.8 million in the
year-ago quarter, and the average cost of funds equaled 4.26%.
The interest expense produced by interest-bearing deposits declined
$29.3 million year-over-year to $55.5 million, as the impact of a $1.0
billion increase in the average balance to $13.0 billion was outweighed
by the benefit of a 113-basis point decline in the average cost of such
funds to 1.71%. CDs accounted for $44.6 million of the interest expense
generated by deposits in the current second quarter, representing a
year-over-year reduction of $21.2 million. The latter decline was the
result of a $105.4 million reduction in the average balance of CDs to
$6.3 billion and a 129-basis point reduction in the average cost to
2.84%. With $5.5 billion of CDs having an average interest rate of 2.40%
scheduled to mature in the next four quarters, the Company currently
expects to see a further decline in the cost of such funds, absent an
increase in the federal funds rate, during this time.
In addition, the interest expense produced by NOW and money market
accounts declined by $5.8 million to $7.3 million, as the impact of a
$1.0 billion increase in the average balance to $4.0 billion was
exceeded by the benefit of a 103-basis point reduction in the average
cost to 0.73%.
Excluding the impact of the debt repositioning charge in the
year-earlier second quarter, the interest expense produced by borrowed
funds fell $9.7 million to $128.6 million in the current second quarter,
the net effect of an $889.2 million rise in the average balance to $13.7
billion and a 57-basis point decline in the average cost to 3.77%.(3)
Including the debt repositioning charge of $39.6 million, the interest
expense produced by borrowed funds in the second quarter of 2008 was
$177.9 million and the average cost of such funds was 5.59%.
The same factors that contributed to the year-over-year increase in
second quarter 2009 net interest income contributed to the expansion of
the Company's interest rate spread and net interest margin during this
time. At 2.89%, the Company's spread was 60 basis points wider than the
adjusted year-earlier measure, and at 3.06%, its margin was up 52 basis
points year-over-year.(3) Prepayment penalty income
contributed three basis points to the current second quarter margin, as
compared to 12 basis points in the year-earlier three months. Including
the debt repositioning charge, the Company's second quarter 2008 spread
and margin equaled 1.64% and 1.94%, respectively.
On a linked-quarter basis, the Company realized a $10.7 million increase
in net interest income, as a $1.6 million rise in interest income
combined with a $9.1 million decline in interest expense. During the
quarter, the average balance of interest-earning assets rose $109.4
million, driven by the aforementioned increase in loan production, while
the average yield on interest-earning assets declined a single basis
point. Although the average balance of interest-bearing liabilities rose
$32.4 million during the current second quarter, reflecting an increase
in interest-bearing deposits, the average cost of funds declined during
this time by 17 basis points.
In addition, the Company's interest rate spread rose 16 basis points on
a linked-quarter basis, while its net interest margin rose 17 basis
points.
Provision for Loan Losses
The provision for loan losses is based on management's assessment of the
adequacy of the loan loss allowance. This assessment is made
periodically and considers several factors, including the current and
historical performance of the loan portfolio and its inherent risk
characteristics; the level of non-performing loans and charge-offs;
local economic conditions; the direction of real estate values; and
current trends in regulatory supervision.
Reflecting the increase in non-performing loans and net charge-offs, and
the severity of the current credit cycle, the Company recorded a $12.0
million provision for loan losses in the current second quarter,
doubling the loan loss provision recorded in the trailing quarter, and
exceeding the year-earlier provision by $10.3 million. Reflecting the
current second quarter provision and net charge-offs of $9.2 million,
the allowance for loan losses rose $2.8 million from the March 31, 2009
balance to $98.1 million at June 30, 2009. For additional information
about the provision for loan losses and the loan loss allowance, please
see the discussion of asset quality earlier in this release.
Non-interest Income
The Company has three primary components of non-interest income: fee
income, income from bank-owned life insurance ("BOLI"), and other
income, primarily consisting of revenues from the sale of third-party
investment products and revenues from the Company's investment
subsidiary, Peter B. Cannell & Co., Inc. ("PBC"). The non-interest
income from these three ongoing revenue sources totaled $22.0 million in
the current second quarter, as compared to $26.4 million in the
year-earlier three months.
The year-over-year reduction was primarily due to a $3.0 million decline
in other income to $6.0 million, including a $1.4 million reduction in
PBC revenues and a $783,000 decline in revenues from investment product
sales. In addition, fee income declined by $928,000 year-over-year to
$9.3 million and BOLI income fell $406,000 to $6.7 million during this
time. Furthermore, the Company recorded a net gain of $568,000 on the
sale of securities in the second quarter of 2008; no such gains were
recorded in the second quarter of this year.
In the second quarters of 2009 and 2008, the combined revenues from the
three ongoing components of non-interest income were offset by OTTI
charges of $39.7 million and $49.6 million, respectively. As a result of
these charges, the Company recorded non-interest losses in the current
and year-earlier second quarters of $17.7 million and $22.7 million,
respectively.
Non-interest Expense
Reflecting a pre-tax FDIC special assessment of $14.0 million, recorded
in general and administrative ("G&A") expense, the Company recorded
operating expenses of $101.9 million and non-interest expense of $107.4
million in the three months ended June 30, 2009. Excluding the FDIC
special assessment, operating expenses would have equaled $88.0 million
during the quarter, representing a linked-quarter increase of $4.1
million and a year-over-year increase of $5.5 million. Similarly,
non-interest expense would have equaled $93.5 million, representing a
linked-quarter increase of $3.9 million and a $280.2 million reduction
from the year-earlier amount. In the second quarter of 2008, the
Company's non-interest expense was increased to $373.7 million by the
$285.4 million pre-tax debt repositioning charge.
Compensation and benefits represented $45.0 million of operating
expenses in the current second quarter, up $2.6 million on a
linked-quarter basis and $1.7 million year-over-year. Occupancy and
equipment expense rose $695,000 year-over-year to $17.9 million, but
declined $829,000 from the trailing-quarter amount. G&A expense totaled
$39.0 million in the current second quarter, up $16.2 million and $17.0
million, respectively, from the levels recorded in the three months
ended March 31, 2009 and June 30, 2008. The increases in G&A expense
were due to the $14.0 million FDIC special assessment, together with an
increase in ongoing FDIC insurance premiums.
Income Tax Expense
The Company recorded income tax expense of $24.0 million in the current
second quarter, in contrast to an income tax benefit of $112.7 million
in the second quarter of 2008. In the three months ended June 30, 2009,
the Company recorded pre-tax income of $80.5 million; in the
year-earlier quarter, the Company recorded a pre-tax loss of $267.5
million which was largely attributable to the $325.0 million debt
repositioning charge. In addition, the Company's income tax expense in
the current second quarter reflects an effective tax rate of 29.9%.
About New York Community Bancorp, Inc.
With assets of $32.9 billion at June 30, 2009, New York Community
Bancorp, Inc. is the 24th largest bank holding company in the nation and
a leading producer of multi-family loans in New York City, with an
emphasis on apartment buildings that feature below-market rents. The
Company has two bank subsidiaries: New York Community Bank, with 178
branches serving customers throughout Metro New York and New Jersey; and
New York Commercial Bank, with 36 branches serving customers in
Manhattan, Queens, Brooklyn, Long Island, and Westchester County in New
York.
Reflecting its growth through a series of acquisitions, the Community
Bank operates through five local divisions: Queens County Savings Bank
in Queens, Roslyn Savings Bank on Long Island, Richmond County Savings
Bank on Staten Island, Roosevelt Savings Bank in Brooklyn, and Garden
State Community Bank in New Jersey. Similarly, the Commercial Bank
operates 17 of its branches under the name Atlantic Bank. Information
about the Company and its bank subsidiaries is available at www.myNYCB.com
and www.NewYorkCommercialBank.com.
Post-Earnings Conference Call
The Company will host a conference call on July 29, 2009 at 9:30 a.m.
(ET) to discuss its second quarter 2009 performance and strategies. The
conference call may be accessed by dialing 800-862-9098 (for domestic
calls) or 785-424-1051 (for international calls) and providing the
following access code: 72QNYCB. A replay will be available approximately
two hours following completion of the call through midnight on August
3rd, and may be accessed by calling 800-839-5203 (domestic) or
402-220-2695 (international) and providing the same access code. The
conference call will also be webcast, and may be accessed by visiting
the Company's web site, www.myNYCB.com,
clicking on "Investor Relations," and following the prompts. The webcast
will be archived through 5:00 p.m. on August 26, 2009.
Forward-looking Statements and
Associated Risk Factors
This release, like many written and oral communications presented by New
York Community Bancorp, Inc. and our authorized officers, may contain
certain forward-looking statements regarding our prospective performance
and strategies within the meaning of Section 27A of the Securities Act
of 1933, as amended, and Section 21E of the Securities Exchange Act of
1934, as amended. We intend such forward-looking statements to be
covered by the safe harbor provisions for forward-looking statements
contained in the Private Securities Litigation Reform Act of 1995, and
are including this statement for purposes of said safe harbor provisions.
Forward-looking statements, which are based on certain assumptions and
describe future plans, strategies, and expectations of the Company, are
generally identified by use of the words "anticipate," "believe,"
"estimate," "expect," "intend," "plan," "project," "seek," "strive,"
"try," or future or conditional verbs such as "will," "would," "should,"
"could," "may," or similar expressions. Our ability to predict results
or the actual effects of our plans or strategies is inherently
uncertain. Accordingly, actual results may differ materially from
anticipated results.
There are a number of factors, many of which are beyond our control,
that could cause actual conditions, events, or results to differ
significantly from those described in our forward-looking statements.
These factors include, but are not limited to: general economic
conditions and trends, either nationally or in some or all of the areas
in which we and our customers conduct our respective businesses;
conditions in the securities and real estate markets or the banking
industry; changes in interest rates, which may affect our net income,
prepayment penalty income, and other future cash flows, or the market
value of our assets, including our investment securities; changes in
real estate values, which could impact the quality of the assets
securing the loans in our portfolio; changes in the quality or
composition of our loan or securities portfolios; changes in competitive
pressures among financial institutions or from non-financial
institutions; changes in our customer base or in the financial or
operating performances of our customers' businesses; changes in the
demand for our deposit, loan, and investment products and other
financial services in the markets we serve; changes in deposit flows and
wholesale borrowing facilities; changes in our credit ratings or in our
ability to access the capital markets; changes in our estimates of
future reserves based upon the periodic review thereof under relevant
regulatory and accounting requirements; changes in our capital
management policies, including those regarding business combinations,
dividends, and share repurchases, among others; our ability to retain
key members of management; changes in legislation, regulation, and
policies, including, but not limited to, those pertaining to banking,
securities, taxation, environmental protection, and insurance, and the
ability to comply with such changes in a timely manner; changes in
accounting principles, policies, practices, or guidelines; changes in
the monetary and fiscal policies of the U.S. Government, including
policies of the U.S. Treasury and the Federal Reserve Board of
Governors; our timely development of new lines of business and
competitive products or services in a changing environment, and the
acceptance of such products or services by our customers; operational
issues stemming from, and/or capital spending necessitated by, the
potential need to adapt to industry changes in information technology
systems, on which we are highly dependent; any interruption or breach of
security resulting in failures or disruptions in customer account
management, general ledger, deposit, loan, or other systems; any
interruption in customer service due to circumstances beyond our
control; potential exposure to unknown or contingent liabilities of
companies we have acquired or target for acquisition; the outcome of
pending or threatened litigation, or of other matters before regulatory
agencies, or of matters resulting from regulatory exams, whether
currently existing or commencing in the future; environmental conditions
that exist or may exist on properties owned by, leased by, or mortgaged
to the Company; war or terrorist activities; and other economic,
competitive, governmental, regulatory, and geopolitical factors
affecting our operations, pricing, and services.
In addition, it should be noted that we routinely evaluate opportunities
to expand through acquisition and frequently conduct due diligence
activities in connection with such opportunities. As a result,
acquisition discussions and, in some cases, negotiations, may take place
at any time, and acquisitions involving cash, debt, or equity securities
may occur.
Furthermore, the timing and occurrence or non-occurrence of events may
be subject to circumstances beyond our control.
Readers are cautioned not to place undue reliance on the forward-looking
statements contained herein, which speak only as of the date of this
release. Except as required by applicable law or regulation, we
undertake no obligation to update these forward-looking statements to
reflect events or circumstances that occur after the date on which such
statements were made.
- Financial Statements and Highlights Follow -
NEW YORK COMMUNITY BANCORP, INC.
CONSOLIDATED STATEMENTS OF CONDITION
(in thousands, except share data)
June 30, December 31,
2009 2008
(unaudited)
Assets
Cash and cash equivalents $ 162,764 $ 203,216
Securities available for sale:
Mortgage-related 749,709 833,684
Other 99,404 176,818
Total available-for-sale securities 849,113 1,010,502
Securities held to maturity:
Mortgage-related 2,813,348 3,164,856
Other 1,976,425 1,726,135
Total held-to-maturity securities 4,789,773 4,890,991
Total securities 5,638,886 5,901,493
Mortgage loans:
Multi-family 16,223,193 15,725,654
Commercial real estate 4,773,133 4,551,025
Acquisition, development, and construction 726,125 776,559
1-4 family 240,451 266,307
Total mortgage loans 21,962,902 21,319,545
Other loans 814,261 872,667
Total loans 22,777,163 22,192,212
Less: Allowance for loan losses (98,082 ) (94,368 )
Loans, net 22,679,081 22,097,844
Federal Home Loan Bank of New York stock, at 439,063 400,979
cost
Premises and equipment, net 211,137 217,762
Goodwill 2,436,401 2,436,401
Core deposit intangibles, net 76,617 87,780
Other assets 1,216,174 1,121,431
Total assets $ 32,860,123 $ 32,466,906
Liabilities and Stockholders' Equity
Deposits:
NOW and money market accounts $ 4,424,433 $ 3,818,952
Savings accounts 2,756,674 2,632,078
Certificates of deposit 6,046,646 6,796,971
Non-interest-bearing accounts 1,126,328 1,127,647
Total deposits 14,354,081 14,375,648
Borrowed funds:
Wholesale borrowings 12,905,528 12,343,064
Junior subordinated debentures 483,987 484,216
Other borrowings 669,488 669,430
Total borrowed funds 14,059,003 13,496,710
Other liabilities 236,373 375,302
Total liabilities 28,649,457 28,247,660
Stockholders' equity:
Preferred stock at par $0.01 (5,000,000 shares -- --
authorized; none issued)
Common stock at par $0.01 (600,000,000 shares
authorized; 345,208,226
and 344,985,111 shares issued; 345,208,174 and 3,452 3,450
344,985,111 shares
outstanding at the respective dates)
Paid-in capital in excess of par 4,187,864 4,181,599
Retained earnings 97,125 123,511
Treasury stock (52 and 0 shares at the (1 ) --
respective dates)
Unallocated common stock held by ESOP (1,473 ) (1,995 )
Accumulated other comprehensive loss, net of
tax:
Net unrealized loss on securities, net of tax (24,185 ) (32,506 )
Net unrealized loss on securities transferred
from available for sale to held to maturity, net (4,323 ) (4,706 )
of tax
Net unrealized loss on pension and (47,793 ) (50,107 )
post-retirement obligations, net of tax
Total accumulated other comprehensive loss, net (76,301 ) (87,319 )
of tax
Total stockholders' equity 4,210,666 4,219,246
Total liabilities and stockholders' equity $ 32,860,123 $ 32,466,906
NEW YORK COMMUNITY BANCORP, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
(unaudited)
For the Three Months Ended For the Six Months
Ended
June 30, March 31, June 30, June 30, June 30,
2009 2009 2008 2009 2008
Interest Income:
Mortgage and other $321,640 $321,717 $310,396 $643,357 $623,384
loans
Securities and money 80,056 78,389 82,904 158,445 172,240
market investments
Total interest 401,696 400,106 393,300 801,802 795,624
income
Interest Expense:
NOW and money market 7,314 7,563 13,144 14,877 27,312
accounts
Savings accounts 3,565 4,216 5,869 7,781 11,874
Certificates of 44,617 52,723 65,799 97,340 142,373
deposit
Borrowed funds 128,615 128,689 177,938 257,304 322,056
Total interest 184,111 193,191 262,750 377,302 503,615
expense
Net interest income 217,585 206,915 130,550 424,500 292,009
Provision for loan 12,000 6,000 1,700 18,000 1,700
losses
Net interest income
after provision for 205,585 200,915 128,850 406,500 290,309
loan losses
Non-interest (Loss)
Income:
Fee income 9,282 9,291 10,210 18,573 20,794
Bank-owned life 6,728 6,840 7,134 13,568 13,879
insurance
Net gain on sale of -- -- 568 -- 568
securities
Loss on
other-than-temporary (39,728 ) -- (49,595 ) (39,728 ) (49,595 )
impairment of
securities
Gain on debt -- -- -- -- 926
repurchases
Other 6,007 6,045 9,024 12,052 19,266
Total non-interest (17,711 ) 22,176 (22,659 ) 4,465 5,838
(loss) income
Non-interest
Expense:
Operating expenses:
Compensation and 45,045 42,422 43,340 87,467 86,406
benefits
Occupancy and 17,907 18,736 17,212 36,643 34,922
equipment
General and 38,975 22,753 21,948 61,728 39,990
administrative
Total operating 101,927 83,911 82,500 185,838 161,318
expenses
Debt repositioning -- -- 285,369 -- 285,369
charge
Amortization of core 5,476 5,687 5,821 11,163 11,853
deposit intangibles
Total non-interest 107,403 89,598 373,690 197,001 458,540
expense
Income (loss) before 80,471 133,493 (267,499 ) 213,964 (162,393 )
income taxes
Income tax expense 24,023 44,804 (112,716 ) 68,827 (79,981 )
(benefit)
Net Income (Loss) $56,448 $88,689 $ ) $145,137 $(82,412 )
(154,783
Basic earnings $0.16 $0.26 $(0.47 ) $0.42 $(0.25 )
(loss) per share
Diluted earnings $0.16 $0.26 $(0.47 ) $0.42 $(0.25 )
(loss) per share
NEW YORK COMMUNITY BANCORP, INC.
RECONCILIATION OF GAAP AND OPERATING EARNINGS
(unaudited)
Although operating earnings are not a measure of performance calculated in
accordance with U.S.
generally accepted accounting principles ("GAAP"), we believe that operating
earnings are an
important indication of our ability to generate earnings through our fundamental
banking business.
Since operating earnings exclude the effects of certain items that are unusual
and/or difficult to
predict, we believe that our operating earnings provide useful supplemental
information to both
management and investors in evaluating the Company's financial results.
Operating earnings should not be considered in isolation or as a substitute for
net income, cash
flows from operating activities, or other income or cash flow statement data
calculated in
accordance with GAAP. Moreover, the manner in which we calculate our operating
earnings may differ
from that of other companies reporting measures with similar names.
Reconciliations of the Company's GAAP and operating earnings for the three
months ended June 30, 2009
and 2008 and for the six months ended June 30, 2009 and 2008 follow. The
Company's GAAP and
operating earnings for the three months ended March 31, 2009 were the same.
For the Three Months Ended For the Six Months Ended
June 30, March 31, June 30, June 30, June 30,
(in thousands,
except per share 2009 2009 2008 2009 2008
data)
GAAP Earnings (Loss) $56,448 $88,689 $ ) $145,137 $(82,412 )
(154,783
Adjustments to GAAP
earnings (loss):
FDIC special 13,952 -- -- 13,952 --
assessment
Loss on
other-than-temporary 39,728 -- 49,595 39,728 49,595
impairment of
securities
Debt repositioning -- -- 325,016 -- 325,016
charge
Litigation -- -- 3,365 -- 3,365
settlement charge
Visa-related gain -- -- -- -- (1,647 )
Gain on debt -- -- -- -- (926 )
repurchases
Income tax effect (21,075 ) -- (148,077 ) (21,075 ) (147,706 )
Operating earnings $89,053 $88,689 $75,116 $177,742 $145,285
Diluted GAAP
Earnings (Loss) per $0.16 $0.26 $(0.47 ) $0.42 $(0.25 )
Share
Adjustments to
diluted GAAP
earnings (loss) per
share:
FDIC special 0.03 -- -- 0.03 --
assessment
Loss on
other-than-temporary 0.07 -- 0.09 0.07 0.09
impairment of
securities
Debt repositioning -- -- 0.60 -- 0.60
charge
Litigation -- -- 0.01 -- --
settlement charge
Visa-related gain -- -- -- -- --
Net gain on sale of -- -- -- -- --
securities
Gain on debt -- -- -- -- --
repurchases
Diluted operating $0.26 $0.26 $0.23 $0.51 $0.44
earnings per share
Note: Footing differences in the table are due to rounding.
NEW YORK COMMUNITY BANCORP, INC.
RECONCILIATION OF GAAP AND CASH EARNINGS
(unaudited)
While cash earnings are not a measure of performance calculated in accordance
with GAAP, the Company
believes that this measure is important because of its contribution to tangible
stockholders'equity.
(Please see the discussion and reconciliation of stockholders' equity and
tangible stockholders'
equity elsewhere in this release.) The Company calculates cash earnings by
adding back to GAAP
earnings certain items that have been charged against net income but added back
to tangible
stockholders' equity. Unlike other expenses incurred by the Company, such
capital items represent
contributions to, not reductions of, tangible stockholders' equity. For this
reason, the Company
believes that cash earnings are useful to investors seeking to evaluate its
financial performanceand
to compare its performance with other companies in the banking industry that
also report cash
earnings.
Cash earnings should not be considered in isolation or as a substitute for net
income, cash flows from
operating activities, or other income or cash flow statement data calculated in
accordance with GAAP.
Moreover, the manner in which the Company calculates cash earnings may differ
from that of other
companies reporting measures with similar names.
Reconciliations of the Company's GAAP and cash earnings for the three and six
months ended June 30,
2009 follow:
For the Three For the Six
(in thousands, except per share data) Months Ended Months Ended
June 30, 2009 June 30, 2009
GAAP Earnings $56,448 $145,137
Additional contributions to tangible stockholders'
equity:
Amortization and appreciation of shares held in 3,194 6,678
stock-related benefit plans
Associated tax effects (566 ) 1,321
Dividends on unallocated ESOP shares 158 316
Amortization of core deposit intangibles 5,476 11,163
Loss on other-than-temporary impairment of 24,222 24,222
securities
Total additional contributions to tangible 32,484 43,700
stockholders' equity
Cash earnings $88,932 $188,837
Diluted GAAP Earnings per Share $0.16 $0.42
Additional contributions to diluted GAAP earnings
per share:
Amortization and appreciation of shares held in 0.01 0.02
stock-related benefit plans
Associated tax effects -- --
Dividends on unallocated ESOP shares -- --
Amortization of core deposit intangibles 0.02 0.04
Loss on other-than-temporary impairment of 0.07 0.07
securities
Total additional contributions to diluted GAAP 0.10 0.13
earnings per share
Diluted cash earnings per share $0.26 $0.55
Cash Earnings Data:
Cash return on average assets 1.10 % 1.17 %
Cash return on average tangible assets (1) 1.19 1.27
Cash return on average stockholders' equity 8.49 9.04
Cash return on average tangible stockholders' 21.25 22.79
equity (1)
Cash efficiency ratio (2) 41.21 38.23
Please see the reconciliations of stockholders' equity and tangible
(1) stockholders' equity, total assets and tangible assets, and the related
capital measures elsewhere in this release.
The Company calculates its cash efficiency ratio by dividing its operating
(2) expenses by the sum of its net interest income and non-interest income after
excluding the pertinent non-cash items from its operating expenses and
non-interest income.
NEW YORK COMMUNITY BANCORP, INC.
RECONCILIATIONS OF STOCKHOLDERS' EQUITY AND TANGIBLE STOCKHOLDERS' EQUITY,
TOTAL ASSETS AND TANGIBLE ASSETS, AND THE RELATED MEASURES
(unaudited)
Although tangible stockholders' equity, adjusted tangible stockholders' equity,
tangible assets, and
adjusted tangible assets are not measures that are calculated in accordance with GAAP,
management uses
these non-GAAP measures in its analysis of the Company's performance. The Company
believes that these non-
GAAP measures are an important indication of its ability to grow both organically and
through business
combinations, and, with respect to tangible stockholders' equity and adjusted tangible
stockholders'
equity, its ability to pay dividends and to engage in various capital management
strategies.
The Company calculates tangible stockholders' equity by subtracting from stockholders'
equity the sum of its
goodwill and core deposit intangibles ("CDI") and calculates tangible assets by
subtracting the same sum
from its total assets. To calculate its ratio of tangible stockholders' equity to
tangible assets, the
Company divides its tangible stockholders' equity by its tangible assets, both of which
include accumulated
other comprehensive loss, net of tax ("AOCL"). AOCL consists of after-tax net
unrealized losses on
securities and pension and post-retirement obligations, and is recorded in the
Company's Consolidated
Statements of Condition. The Company also calculates its ratio of tangible
stockholders' equity to tangible
assets excluding AOCL, as its components are impacted by changes in market conditions,
including interest
rates, which fluctuate. This ratio is referred to as the ratio of "adjusted tangible
stockholders' equity
to adjusted tangible assets." The Company calculates tangible book value per share by
dividing its tangible
stockholders' equity by the number of shares outstanding less any unallocated ESOP
shares. To calculate its
returns on average tangible assets and average tangible stockholders' equity, the
Company adds the
amortization of CDI, net of tax, back to net income and divides the adjusted net income
by its average
tangible assets and average tangible stockholders' equity, respectively. Average
tangible stockholders'
equity is calculated by subtracting average goodwill and average CDI from average
stockholders' equity.
Neither tangible stockholders' equity, adjusted tangible stockholders' equity, tangible
assets, adjusted
tangible assets, nor the related capital measures should be considered in isolation or
as a substitute for
stockholders' equity, total assets, or any other measure calculated in accordance with
GAAP. Moreover, the
manner in which the Company calculates its tangible stockholders' equity, adjusted
tangible stockholders'
equity, tangible assets, adjusted tangible assets, and the related measures may differ
from that of other
companies reporting measures with similar names. Reconciliations of the Company's
stockholders' equity,
tangible stockholders' equity, and adjusted tangible stockholders' equity; total
assets, tangible assets,
and adjusted tangible assets; and the related measures at or for the three months ended
June 30, 2009,
March 31, 2009, and December 31, 2008 and the six months ended June 30, 2009 and 2008
follow:
At or for the At or for the
Three Months Ended Six Months Ended
June 30, March 31, Dec. 31, June 30, June 30,
2009 2009 2008 2009 2008
(in
thousands)
Total
Stockholders' $4,210,666 $4,235,886 $4,219,246 $4,210,666 $4,289,261
Equity
Less: (2,436,401 ) (2,436,401 ) (2,436,401 ) (2,436,401 ) (2,436,881 )
Goodwill
Core deposit (76,617 ) (82,093 ) (87,780 ) (76,617 ) (99,270 )
intangibles
Tangible
stockholders' $1,697,648 $1,717,392 $1,695,065 $1,697,648 $1,753,110
equity
Total Assets $32,860,123 $32,402,552 $32,466,906 $32,860,123 $31,083,499
Less: (2,436,401 ) (2,436,401 ) (2,436,401 ) (2,436,401 ) (2,436,881 )
Goodwill
Core deposit (76,617 ) (82,093 ) (87,780 ) (76,617 ) (99,270 )
intangibles
Tangible $30,347,105 $29,884,058 $29,942,725 $30,347,105 $28,547,348
assets
Tangible
Stockholders' $1,697,648 $1,717,392 $1,695,065 $1,697,648 $1,753,110
Equity
Add back:
Accumulated
other 76,301 78,086 87,319 76,301 17,197
comprehensive
loss, net of
tax
Adjusted
tangible $1,773,949 $1,795,478 $1,782,384 $1,773,949 $1,770,307
stockholders'
equity
Tangible $30,347,105 $29,884,058 $29,942,725 $30,347,105 $28,547,348
Assets
Add back:
Accumulated
other 76,301 78,086 87,319 76,301 17,197
comprehensive
loss, net of
tax
Adjusted
tangible $30,423,406 $29,962,144 $30,030,044 $30,423,406 $28,564,545
assets
Average
Stockholders' $4,190,524 $4,162,211 $4,185,087 $4,176,446 $4,152,364
Equity
Less: Average
goodwill and (2,516,568 ) (2,522,191 ) (2,527,650 ) (2,519,363 ) (2,543,104 )
core deposit
intangibles
Average
tangible $1,673,956 $1,640,020 $1,657,437 $1,657,083 $1,609,260
stockholders'
equity
Average $32,377,212 $32,196,921 $32,116,431 $32,287,564 $30,612,488
Assets
Less: Average
goodwill and (2,516,568 ) (2,522,191 ) (2,527,650 ) (2,519,363 ) (2,543,104 )
core deposit
intangibles
Average
tangible $29,860,644 $29,674,730 $29,588,781 $29,768,201 $28,069,384
assets
Net Income $56,448 $88,689 $102,232 $145,137 $(82,412 )
(Loss)
Add back:
Amortization
of core 3,340 3,469 3,497 6,809 7,192
deposit
intangibles,
net of tax
Adjusted net $59,788 $92,158 $105,729 $151,946 $(75,220 )
income (loss)
NEW YORK COMMUNITY BANCORP, INC.
NET INTEREST INCOME ANALYSIS
(dollars in thousands)
(unaudited)
For the Three Months Ended June 30,
2009 2008
Average Average
Average Yield/ Average Yield/
Balance Interest Cost Balance Interest Cost
Assets:
Interest-earning
assets:
Mortgage and other $ 22,382,786 $ 321,640 5.75 % $ 20,478,132 $ 310,396 6.07 %
loans, net
Securities and money 6,035,990 80,056 5.31 6,214,920 82,904 5.34
market investments
Total
interest-earning 28,418,776 401,696 5.65 26,693,052 393,300 5.90
assets
Non-interest-earning 3,958,436 3,871,259
assets
Total assets $ 32,377,212 $ 30,564,311
Liabilities and
Stockholders'
Equity:
Interest-bearing
deposits:
NOW and money market $ 4,038,172 $ 7,314 0.73 % $ 3,010,497 $ 13,144 1.76 %
accounts
Savings accounts 2,699,431 3,565 0.53 2,601,991 5,869 0.91
Certificates of 6,295,936 44,617 2.84 6,401,287 65,799 4.13
deposit
Total
interest-bearing 13,033,539 55,496 1.71 12,013,775 84,812 2.84
deposits
Borrowed funds 13,696,028 128,615 3.77 12,806,797 177,938 5.59
Total
interest-bearing 26,729,567 184,111 2.76 24,820,572 262,750 4.26
liabilities
Non-interest-bearing 1,217,281 1,410,106
deposits
Other liabilities 239,840 136,340
Total liabilities 28,186,688 26,367,018
Stockholders' equity 4,190,524 4,197,293
Total liabilities
and stockholders' $ 32,377,212 $ 30,564,311
equity
Net interest
income/interest rate $ 217,585 2.89 % $ 130,550 1.64 %
spread
Net interest-earning
assets/net interest $ 1,689,209 3.06 % $ 1,872,480 1.94 %
margin
Ratio of
interest-earning
assets to 1.06 x 1.08 x
interest-bearing
liabilities
Core deposits (1) $ 7,954,884 $ 10,879 0.55 % $ 7,022,594 $ 19,013 1.09 %
(1) Refers to all deposits other than certificates of deposit.
Please see the following page for an analysis of the Company's net interest income for
the three
months ended June 30, 2008 excluding the impact of the $39.6 million debt repositioning
charge
recorded in the second quarter of 2008, as compared to its net interest income for the
three months
ended June 30, 2009.
NEW YORK COMMUNITY BANCORP, INC.
ADJUSTED NET INTEREST INCOME ANALYSIS
(dollars in thousands)
(unaudited)
The following table presents an analysis of the Company's second quarter 2008 net
interest income as
if the $39.6 million debt repositioning charge described earlier in this release had
not been
recorded. Although such adjusted net interest income is not a measure of performance
calculated in
accordance with GAAP, we believe that it is an important indication of our ability to
generate net
interest income through our fundamental banking business and therefore provides useful
supplemental
information to both management and investors in evaluating the Company's financial
results.
The following line items are presented in the adjusted net interest income analysis for
the three
months ended June 30, 2008 excluding the impact of the debt repositioning charge:
interest expense on
borrowed funds; cost of borrowed funds; interest expense on average interest-bearing
liabilities;
cost of funds; net interest income, interest rate spread, and net interest margin. No
adjustments
have been made to these items for the three months ended June 30, 2009.
None of these adjusted items should be considered in isolation or as a substitute for
net interest
income or its component measures. Moreover, the manner in which we have calculated our
adjusted net
interest income may differ from that of other companies that may report a measure with
a similar
name.
For the Three Months Ended June 30,
2009 2008
Average Average
Average Yield/ Average Yield/
Balance Interest Cost Balance Interest Cost
Assets:
Interest-earning
assets:
Mortgage and other $ 22,382,786 $ 321,640 5.75 % $ 20,478,132 $ 310,396 6.07 %
loans, net
Securities and money 6,035,990 80,056 5.31 6,214,920 82,904 5.34
market investments
Total
interest-earning 28,418,776 401,696 5.65 26,693,052 393,300 5.90
assets
Non-interest-earning 3,958,436 3,871,259
assets
Total assets $ 32,377,212 $ 30,564,311
Liabilities and
Stockholders'
Equity:
Interest-bearing
deposits:
NOW and money market $ 4,038,172 $ 7,314 0.73 % $ 3,010,497 $ 13,144 1.76 %
accounts
Savings accounts 2,699,431 3,565 0.53 2,601,991 5,869 0.91
Certificates of 6,295,936 44,617 2.84 6,401,287 65,799 4.13
deposit
Total
interest-bearing 13,033,539 55,496 1.71 12,013,775 84,812 2.84
deposits
Borrowed funds 13,696,028 128,615 3.77 12,806,797 138,291 4.34
Total
interest-bearing 26,729,567 184,111 2.76 24,820,572 223,103 3.61
liabilities
Non-interest-bearing 1,217,281 1,410,106
deposits
Other liabilities 239,840 136,340
Total liabilities 28,186,688 26,367,018
Stockholders' equity 4,190,524 4,197,293
Total liabilities
and stockholders' $ 32,377,212 $ 30,564,311
equity
Net interest
income/interest rate $ 217,585 2.89 % $ 170,197 2.29 %
spread
Net interest-earning
assets/net interest $ 1,689,209 3.06 % $ 1,872,480 2.54 %
margin
Ratio of
interest-earning
assets to 1.06 x 1.07 x
interest-bearing
liabilities
Core deposits (1) $ 7,954,884 $ 10,879 0.55 % $ 7,022,594 $ 19,013 1.09 %
(1) Refers to all deposits other than certificates of deposit.
NEW YORK COMMUNITY BANCORP, INC.
NET INTEREST INCOME ANALYSIS
(dollars in thousands)
(unaudited)
For the Three Months Ended
June 30, 2009 March 31, 2009
Average Average
Average Yield/ Average Yield/
Balance Interest Cost Balance Interest Cost
Assets:
Interest-earning
assets:
Mortgage and other $ 22,382,786 $ 321,640 5.75 % $ 22,108,647 $ 321,717 5.83 %
loans, net
Securities and money 6,035,990 80,056 5.31 6,200,776 78,389 5.06
market investments
Total
interest-earning 28,418,776 401,696 5.65 28,309,423 400,106 5.66
assets
Non-interest-earning 3,958,436 3,887,498
assets
Total assets $ 32,377,212 $ 32,196,921
Liabilities and
Stockholders'
Equity:
Interest-bearing
deposits:
NOW and money market $ 4,038,172 $ 7,314 0.73 % $ 3,662,920 $ 7,563 0.84 %
accounts
Savings accounts 2,699,431 3,565 0.53 2,602,051 4,216 0.66
Certificates of 6,295,936 44,617 2.84 6,390,655 52,723 3.35
deposit
Total
interest-bearing 13,033,539 55,496 1.71 12,655,626 64,502 2.07
deposits
Borrowed funds 13,696,028 128,615 3.77 14,041,521 128,689 3.71
Total
interest-bearing 26,729,567 184,111 2.76 26,697,147 193,191 2.93
liabilities
Non-interest-bearing 1,217,281 1,143,996
deposits
Other liabilities 239,840 193,567
Total liabilities 28,186,688 28,034,710
Stockholders' equity 4,190,524 4,162,211
Total liabilities
and stockholders' $ 32,377,212 $ 32,196,921
equity
Net interest
income/interest rate $ 217,585 2.89 % $ 206,915 2.73 %
spread
Net interest-earning
assets/net interest $ 1,689,209 3.06 % $ 1,612,276 2.89 %
margin
Ratio of
interest-earning
assets to 1.06 x 1.06 x
interest-bearing
liabilities
Core deposits (1) $ 7,954,884 $ 10,879 0.55 % $ 7,408,967 $ 11,779 0.64 %
(1) Refers to all deposits other than certificates of deposit.
NEW YORK COMMUNITY BANCORP, INC.
NET INTEREST INCOME ANALYSIS
(dollars in thousands)
(unaudited)
For the Six Months Ended June 30,
2009 2008
Average Average
Average Yield/ Average Yield/
Balance Interest Cost Balance Interest Cost
Assets:
Interest-earning
assets:
Mortgage and other $ 22,246,474 $ 643,357 5.79 % $ 20,361,198 $ 623,384 6.13 %
loans, net
Securities and money 6,117,928 158,445 5.18 6,320,784 172,240 5.45
market investments
Total
interest-earning 28,364,402 801,802 5.66 26,681,982 795,624 5.97
assets
Non-interest-earning 3,923,162 3,930,506
assets
Total assets $ 32,287,564 $ 30,612,488
Liabilities and
Stockholders'
Equity:
Interest-bearing
deposits:
NOW and money market $ 3,851,583 $ 14,877 0.78 % $ 2,813,586 $ 27,312 1.95 %
accounts
Savings accounts 2,651,010 7,781 0.59 2,545,468 11,874 0.94
Certificates of 6,343,033 97,340 3.09 6,686,013 142,373 4.28
deposit
Total
interest-bearing 12,845,626 119,998 1.88 12,045,067 181,559 3.03
deposits
Borrowed funds 13,867,820 257,304 3.74 12,837,961 322,056 5.04
Total
interest-bearing 26,713,446 377,302 2.85 24,883,028 503,615 4.07
liabilities
Non-interest-bearing 1,180,841 1,378,110
deposits
Other liabilities 216,831 198,986
Total liabilities 28,111,118 26,460,124
Stockholders' equity 4,176,446 4,152,364
Total liabilities
and stockholders' $ 32,287,564 $ 30,612,488
equity
Net interest
income/interest rate $ 424,500 2.81 % $ 292,009 1.90 %
spread
Net interest-earning
assets/net interest $ 1,650,956 2.98 % $ 1,798,954 2.17 %
margin
Ratio of
interest-earning
assets to 1.06 x 1.07 x
interest-bearing
liabilities
Core deposits (1) $ 7,683,434 $ 22,658 0.59 % $ 6,737,164 $ 39,186 1.17 %
(1) Refers to all deposits other than certificates of deposit.
Please see the following page for an analysis of the Company's net interest income for
the six months
ended June 30, 2008 excluding the impact of the $39.6 million debt repositioning charge
recorded in
the second quarter of 2008, as compared to its net interest income for the six months
ended June 30,
2009.
NEW YORK COMMUNITY BANCORP, INC.
ADJUSTED NET INTEREST INCOME ANALYSIS
(dollars in thousands)
(unaudited)
The following table presents an analysis of the Company's net interest income for the
six months ended
June 30, 2008 as if the second quarter $39.6 million debt repositioning charge
described earlier in
this release had not been recorded. Although such adjusted net interest income is not a
measure of
performance calculated in accordance with GAAP, we believe that it is an important
indication of our
ability to generate net interest income through our fundamental banking business and
therefore
provides useful supplemental information to both management and investors in evaluating
the Company's
financial results.
The following line items are presented in the adjusted net interest income analysis for
the six months
ended June 30, 2008 excluding the impact of the debt repositioning charge: interest
expense on
borrowed funds; cost of borrowed funds; interest expense on average interest-bearing
liabilities; cost
of funds; net interest income, interest rate spread, and net interest margin. No
adjustments have been
made to these items for the six months ended June 30, 2009.
None of these adjusted items should be considered in isolation or as a substitute for
net interest
income or its component measures. Moreover, the manner in which we have calculated our
adjusted net
interest income may differ from that of other companies that may report a measure with
a similar name.
For the Six Months Ended June 30,
2009 2008
Average Average
Average Yield/ Average Yield/
Balance Interest Cost Balance Interest Cost
Assets:
Interest-earning
assets:
Mortgage and other $ 22,246,474 $ 643,357 5.79 % $ 20,361,198 $ 623,384 6.13 %
loans, net
Securities and money 6,117,928 158,445 5.18 6,320,784 172,240 5.45
market investments
Total
interest-earning 28,364,402 801,802 5.66 26,681,982 795,624 5.97
assets
Non-interest-earning 3,923,162 3,930,506
assets
Total assets $ 32,287,564 $ 30,612,488
Liabilities and
Stockholders'
Equity:
Interest-bearing
deposits:
NOW and money market $ 3,851,583 $ 14,877 0.78 % $ 2,813,586 $ 27,312 1.95 %
accounts
Savings accounts 2,651,010 7,781 0.59 2,545,468 11,874 0.94
Certificates of 6,343,033 97,340 3.09 6,686,013 142,373 4.28
deposit
Total
interest-bearing 12,845,626 119,998 1.88 12,045,067 181,559 3.03
deposits
Borrowed funds 13,867,820 257,304 3.74 12,837,961 282,409 4.42
Total
interest-bearing 26,713,446 377,302 2.85 24,883,028 463,968 3.75
liabilities
Non-interest-bearing 1,180,841 1,378,110
deposits
Other liabilities 216,831 198,986
Total liabilities 28,111,118 26,460,124
Stockholders' equity 4,176,446 4,152,364
Total liabilities
and stockholders' $ 32,287,564 $ 30,612,488
equity
Net interest
income/interest rate $ 424,500 2.81 % $ 331,656 2.22 %
spread
Net interest-earning
assets/net interest $ 1,650,956 2.98 % $ 1,798,954 2.47 %
margin
Ratio of
interest-earning
assets to 1.06 x 1.07 x
interest-bearing
liabilities
Core deposits (1) $ 7,683,434 $ 22,658 0.59 % $ 6,737,164 $ 39,186 1.17 %
(1) Refers to all deposits other than certificates of deposit.
NEW YORK COMMUNITY BANCORP, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS
(dollars in thousands, except share and per share data)
(unaudited)
For the Three Months Ended For the Six Months Ended
June 30, March 31, June 30, June 30, June 30,
2009 2009 2008 2009 2008
GAAP EARNINGS
DATA:
Net income $56,448 $88,689 $(154,783 ) $145,137 $(82,412 )
(loss)
Basic
earnings 0.16 0.26 (0.47 ) 0.42 (0.25 )
(loss) per
share
Diluted
earnings 0.16 0.26 (0.47 ) 0.42 (0.25 )
(loss) per
share
Return on
average 0.70 % 1.10 % (2.03 )% 0.90 % (0.54 )%
assets
Return on
average 0.80 1.24 (2.16 ) 1.02 (0.54 )
tangible
assets (1)
Return on
average 5.39 8.52 (14.75 ) 6.95 (3.97 )
stockholders'
equity
Return on
average
tangible 14.29 22.48 (36.50 ) 18.34 (9.35 )
stockholders'
equity (1)
Efficiency 51.00 36.63 76.47 43.32 54.16
ratio (2)
Operating
expenses to 1.26 1.04 1.08 1.15 1.05
average
assets
Interest rate 2.89 2.73 1.64 2.81 1.90
spread
Net interest 3.06 2.89 1.94 2.98 2.17
margin
Shares used
for basic EPS 343,549,598 343,323,162 331,271,217 343,435,986 326,995,127
computation
Shares used
for diluted 343,625,343 343,401,009 331,271,217 343,512,784 326,995,127
EPS
computation
OPERATING
EARNINGS
DATA:(3)
Operating $89,053 $88,689 $75,116 $177,742 $145,285
earnings
Basic
operating 0.26 0.26 0.23 0.51 0.44
earnings per
share
Diluted
operating 0.26 0.26 0.23 0.51 0.44
earnings per
share
Return on
average 1.10 % 1.10 % 0.98 % 1.10 % 0.95 %
assets
Return on
average 1.24 1.24 1.12 1.24 1.09
tangible
assets (1)
Return on
average 8.50 8.52 7.16 8.51 7.00
stockholders'
equity
Return on
average
tangible 22.08 22.48 18.98 22.27 18.95
stockholders'
equity (1)
Operating
efficiency 36.72 36.63 40.14 36.67 41.08
ratio (2)
Interest rate 2.89 2.73 2.29 2.81 2.22
spread (4)
Net interest 3.06 2.89 2.54 2.98 2.47
margin (4)
Shares used
for basic 343,549,598 343,323,162 331,271,217 343,435,986 326,995,127
operating EPS
computation
Shares used
for diluted 343,625,343 343,401,009 333,103,018 343,512,784 328,502,463
operating EPS
computation
Please see the reconciliations of stockholders' equity and tangible
(1) stockholders' equity, total assets and tangible assets, and the related
capital measures elsewhere in this release.
The Company calculates its GAAP and operating efficiency ratios by dividing
(2) the respective operating expenses by the respective sums of net interest
income and non-interest income. Please see the reconciliations of GAAP and
operating earnings elsewhere in this release.
(3) Please see the reconciliations of GAAP and operating earnings elsewhere in
this release.
Please see the reconciliations of the Company's interest rate spread and net
(4) interest margin to its adjusted interest rate spread and adjusted net
interest margin for the three and six months ended June 30, 2008 elsewhere
in this release.
NEW YORK COMMUNITY BANCORP, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS
(unaudited)
At or for the Three Months Ended
June 30, March 31, December 31,
2009 2009 2008
BALANCE SHEET DATA:
Book value per share $12.21 $12.30 $12.25
Tangible book value per share (1) 4.92 4.99 4.92
Stockholders' equity to total 12.81 % 13.07 % 13.00 %
assets
Tangible stockholders' equity to 5.59 5.75 5.66
tangible assets (1)
Tangible stockholders' equity to
tangible assets excluding 5.83 5.99 5.94
accumulated other comprehensive
loss, net of tax (1)
Shares used for book value and
tangible book value per share 344,742,899 344,398,362 344,353,808
computations (1)
Total shares issued and outstanding 345,208,174 344,946,651 344,985,111
ASSET QUALITY RATIOS:
Non-performing loans to total loans 1.49 % 0.79 % 0.51 %
Non-performing assets to total 1.04 0.55 0.35
assets
Allowance for loan losses to 28.83 54.35 83.00
non-performing loans
Allowance for loan losses to total 0.43 0.43 0.43
loans
Net charge-offs during the period
to average loans outstanding during 0.04 0.02 0.02
the period
Net charge-offs during the period
to the average allowance for loan 9.69 5.37 3.65
losses during the period
Please see the reconciliations of stockholders' equity and tangible
(1) stockholders' equity, total assets and tangible assets, and the related
capital measures elsewhere in this release.
Footnotes to the Text
Please see the reconciliations of the Company's GAAP and operating earnings
(1) for the three and six months ended June 30, 2009 and 2008 elsewhere in this
release.
(2) Please see the reconciliations of the Company's GAAP and cash earnings for
the three and six months ended June 30, 2009 elsewhere in this release.
Please see the reconciliations of the Company's net interest income and
(3) adjusted net interest income, its interest rate spread and adjusted interest
rate spread, and its net interest margin and adjusted net interest margin
for the three and six months ended June 30, 2008 elsewhere in this release.
The Company calculates its GAAP and operating efficiency ratios by dividing
(4) the respective operating expenses by the respective sums of net interest
income and non-interest income. Please see the reconciliations of GAAP and
operating earnings elsewhere in this release.
The SNL Bank & Thrift Index data referenced in this release is calculated by
(5) consolidating the June 30, 2009 data for 281 U.S. banks and thrifts into a
single entity at July 27, 2009.
Please see the reconciliations of the Company's stockholders' equity and
(6) tangible stockholders' equity, its total assets and tangible assets, and the
related capital measures elsewhere in this release.
Source: New York Community Bancorp, Inc.
Contact: New York Community Bancorp, Inc.
Ilene A. Angarola, 516-683-4420
Executive Vice President &
Director, Investor Relations