The First of Long Island Corporation (Nasdaq:FLIC), the parent
company of The First National Bank of Long Island, reported
increases in net income and earnings per share for the three and
six months ended June 30, 2017. In the highlights that
follow, all comparisons are of the current three or six-month
period to the same period last year.
SECOND QUARTER HIGHLIGHTS
- Net Income increased 18.2% to $9.1 million from $7.7
million
- EPS increased 8.8% to $.37 from $.34
- Cash Dividends Per Share increased 5.0% to
$.14
- Total Assets exceeded $3.7 billion at quarter end,
increasing 10% since 6/30/16
- The Mortgage Loan Pipeline at quarter end was strong at
$177 million
- The Credit Quality of the Bank’s loan and securities
portfolios remains excellent
SIX MONTH HIGHLIGHTS
- Net Income increased 18.5% to $18.2 million from $15.4
million
- EPS increased 8.7% to $.75 from $.69
- 16.9% growth in the average balance of
Loans
- 9.5% growth in the average balance of
Noninterest-Bearing Checking Deposits
- 9.0% growth in the average balance of Total
Deposits
- 18.3% growth in average Stockholders’
Equity
Analysis of Earnings – Six Months Ended
June 30, 2017
Net income for the first six months of 2017 was
$18.2 million, an increase of $2.9 million, or 18.5%, over the same
period last year. The increase is primarily attributable to
increases in net interest income of $5.5 million, or 13.1%, and
noninterest income, before securities gains, of $770,000, or 21.1%.
The impact of these items was partially offset by increases
in the provision for loan losses of $1.7 million, noninterest
expense, before debt extinguishment costs, of $602,000, or 2.4%,
and income tax expense of $1.1 million.
The increase in net interest income was driven
by growth in average interest-earning assets of $373.4 million, or
11.9%, which is mainly attributable to an increase in the average
balance of loans of $386.9 million, or 16.9%. Although most
of the loan growth occurred in mortgage loans, commercial and
industrial loans also grew with an increase in average outstandings
of $28.6 million, or 29.6%. The growth in loans was funded by
growth in the average balances of noninterest-bearing checking
deposits of $73.5 million, or 9.5%, interest-bearing deposits of
$154.2 million, or 8.8%, short-term borrowings of $110.4 million
and stockholders’ equity of $49.7 million, or 18.3%.
Substantial contributors to the growth in deposits were new branch
openings and the Bank’s ongoing municipal deposit initiative.
Substantial contributors to the growth in stockholders’ equity were
net income, $35.3 million of capital raised in an underwritten
public offering in the first-half of 2016 and the ongoing issuance
of shares under the Corporation’s Dividend Reinvestment and Stock
Purchase Plan. These sources of capital were partially offset
by the declaration of cash dividends.
Net interest margin of 2.91% for the first six
months of 2017 was unchanged from the same period of last
year. The current level of net interest margin reflects the
low interest rate environment that has persisted for an extended
period of time. In the current and anticipated interest rate
environment, net interest margin may be difficult to maintain and
may even decline and thereby inhibit earnings growth.
The increase in noninterest income, before
securities gains, of $770,000, or 21.1%, is primarily attributable
to increases in cash value accretion on bank-owned life insurance
(“BOLI”) of $278,000, service charges on deposit accounts of
$104,000 and Investment Management Division income of
$60,000. Also contributing to the increase in noninterest
income were refunds of $184,000 related to sales tax, real estate
taxes and telecommunications charges, the elimination of $77,000 in
accrued circuit termination charges and an increase of $53,000 in
checkbook income. Cash value accretion increased because of
purchases of BOLI during the first quarter of 2017 with an initial
cash value of $25 million. The increase in service charges on
deposit accounts is due to higher overdraft and maintenance and
activity charges. Investment Management Division income
increased because of increases in assets under management resulting
principally from improved equity market conditions.
The increase in noninterest expense, before debt
extinguishment costs, of $602,000, or 2.4%, is primarily
attributable to increases in salaries of $813,000, or 7.4%,
employee benefits expense of $142,000, or 4.1%, occupancy and
equipment expense of $442,000, or 9.7%, marketing expense of
$270,000 and legal fees of $111,000. The impact of these
items was partially offset by decreases in consulting fees of
$717,000, computer and telecommunications expense of $415,000 and
FDIC insurance expense of $229,000. The increase in salaries
is primarily due to new branch openings, additions to staff in the
back office, higher stock-based compensation expense and normal
annual salary adjustments. The increase in employee benefits
expense resulted primarily from increases in group health insurance
expense of $192,000 and payroll tax expense of $57,000, partially
offset by a decrease in retirement plan expense of $146,000.
The increase in group health insurance expense resulted from
increases in staff count and the rates being charged by insurance
carriers and the decrease in retirement plan expense resulted from
an increase in the discount rate and favorable performance of plan
assets. The increase in occupancy and equipment expense is
primarily due to the operating costs of new branches and
depreciation of the Bank’s facilities and equipment. The
increase in marketing expense is largely due to new branch and
deposit account promotions. The decrease in consulting fees
is mainly due to a charge of $800,000 in the second quarter of 2016
for advisory services rendered in renegotiating the Bank’s data
processing contract. The decrease in computer and
telecommunications expense reflects the cost savings arising from
the aforementioned data processing contract renegotiation and
one-time expenses of approximately $126,000 incurred in the 2016
period related to changes in the Corporation’s network and security
systems. The decrease in FDIC insurance expense is
attributable to lower FDIC assessment rates effective July 1, 2016,
partially offset by a growth-related increase in the assessment
base.
Securities gains of $58,000 in the first half of
2017 are almost entirely due to a deleveraging transaction in the
first quarter involving the sale of approximately $40 million of
available-for-sale mortgage-backed securities and use of the
resulting proceeds to pay down short-term borrowings. During
the second quarter of 2016, the Bank completed a deleveraging
transaction that involved the sale of $40.3 million of mortgage
securities at a gain of $1,795,000 and prepayment of $30 million of
long-term debt at a cost of $1,756,000. These deleveraging
transactions were undertaken to eliminate inefficient leverage and
accrete Tier 1 leverage capital.
The increase in the provision for loan losses is
mainly due to more loan growth in the current six-month period and
an increase in specific reserves on loans individually deemed to be
impaired, partially offset by improved economic conditions.
Loans grew $228.6 million in the first six months of this year
versus $105.4 million in the same period last year. The
increase in specific reserves is primarily due to one impaired loan
of $7.1 million transferred to nonaccrual status during the second
quarter of 2017.
The $1.1 million increase in income tax expense
is mainly attributable to higher pre-tax earnings in the first six
months of 2017 versus the same period last year and a decline in
the amount of pre-tax book income from tax-exempt securities,
partially offset by larger tax benefits derived from BOLI and the
vesting and exercise of stock awards. The vesting and
exercise of stock awards resulted in tax benefits of $597,000 and
$314,000 in the first six months of 2017 and 2016,
respectively.
Analysis of Earnings – Second Quarter
2017 Versus Second Quarter 2016
Net income for the second quarter of 2017 was
$9.1 million, representing an increase of $1.4 million, or 18.2%,
over $7.7 million earned in the second quarter of last year.
The increase is primarily attributable to increases in net interest
income of $2.5 million and cash value accretion on BOLI of
$162,000, and the aforementioned refunds of sales tax and
telecommunications charges and elimination of circuit termination
charges. Also contributing to the increase were decreases in
consulting fees of $753,000, FDIC insurance expense of $111,000 and
computer and telecommunications expense of $321,000. These
items were partially offset by increases in the provision for loan
losses of $1.2 million, salaries of $467,000, occupancy and
equipment expense of $298,000, marketing expense of $294,000 and
income tax expense of $317,000. Second quarter variances
occurred for substantially the same reasons discussed above with
respect to the six-month periods.
Analysis of Earnings – Second Quarter
Versus First Quarter 2017
Net income for the second quarter of 2017
increased $52,000 over the first quarter. The increase was
primarily attributable to increases in net interest income of
$133,000 and cash value accretion on BOLI of $46,000, and the
aforementioned refunds of sales tax and telecommunications charges
and elimination of circuit termination charges. Earnings for
the second quarter also benefited from a decline in income tax
expense of $316,000. These items were offset by increases in
the provision for loan losses of $505,000 and marketing expense of
$258,000 and a decrease in real estate tax refunds of $56,000.
The decrease in income tax expense was due to lower pretax
earnings and higher tax benefits from BOLI and the vesting and
exercise of stock awards in the second quarter. The increase
in the provision for loan losses was mainly due to higher specific
reserves in the second quarter partially offset by lower loan
growth. Other variances occurred for substantially the same
reasons discussed above with respect to the six-month periods.
Asset Quality
The Bank’s allowance for loan losses to total
loans decreased 2 basis points from 1.18% at year-end 2016 to 1.16%
at June 30, 2017. The decrease is primarily due to
adjustments to certain qualitative factors to reflect improved
economic conditions, partially offset by an increase in specific
reserves on loans individually deemed to be impaired. The
provision for loan losses was $2.1 million and $392,000 in the
first six months 2017 and 2016, respectively. The amount of
the provision in each period was driven mainly by loan growth and,
in the first six months of 2017, specific reserves, partially
offset by improved economic conditions.
The overall credit quality of the Bank’s loan
portfolio remains excellent. Nonaccrual loans amounted to
$9.0 million, or .32% of total loans outstanding, at June 30, 2017,
compared to $2.6 million, or .10%, at December 31, 2016. The
increase is primarily attributable to one impaired loan of $7.1
million transferred to nonaccrual status during the second quarter
of 2017, partially offset by three loans returned to an accrual
status based on the demonstrated ability of the borrowers to
service their debt. Troubled debt restructurings amounted to
$1.2 million, or .04% of total loans outstanding, at June 30, 2017,
representing a decrease of $344,000 from year-end 2016. Of
the troubled debt restructurings at quarter-end, $926,000 are
performing in accordance with their modified terms and $275,000 are
nonaccrual and included in the aforementioned amount of nonaccrual
loans. The $344,000 decrease in troubled debt restructurings
was primarily attributable to the payoff of one loan and the
paydown on another loan. Loans past due 30 through 89 days
amounted to $4.6 million, or .17% of total loans outstanding, at
June 30, 2017, compared to $1.1 million, or .04%, at December 31,
2016. Management does not believe that the increases in
nonaccrual loans and loans past due 30 through 89 days are
indicative of a deterioration in the overall credit quality of the
Bank’s loan portfolio.
The credit quality of the Bank’s securities
portfolio also remains excellent. The Bank’s mortgage
securities are backed by mortgages underwritten on conventional
terms, with 57% of these securities being full faith and credit
obligations of the U.S. government and the balance being
obligations of U.S. government sponsored entities. The
remainder of the Bank’s securities portfolio principally consists
of high quality, general obligation municipal securities rated AA
or better by major rating agencies. In selecting municipal
securities for purchase, the Bank uses credit agency ratings for
screening purposes only and then performs its own credit
analysis. On an ongoing basis, the Bank periodically assesses
the credit strength of the municipal securities in its portfolio
and makes decisions to hold or sell based on such assessments.
Capital
The Corporation’s Tier 1 leverage, Common Equity
Tier 1 risk-based, Tier 1 risk-based and Total risk-based capital
ratios were approximately 9.0%, 14.9%, 14.9% and 16.2%,
respectively, at June 30, 2017. The strength of the
Corporation’s balance sheet positions the Corporation for continued
growth in a measured and disciplined fashion.
During the first quarter of 2017, the
Corporation’s Board of Directors increased the amount of stock that
an individual can purchase on a quarterly basis under the stock
purchase component of the Dividend Reinvestment and Stock Purchase
Plan (the “Plan”) from $50,000 to $75,000. This change is
providing additional capital that is being used to accommodate
balance sheet growth. Common stock issued under the Plan
relating to 2017 dividend declarations totaled $11.3 million.
Future levels of dividend reinvestment and stock purchases cannot
be projected with certainty.
Key Strategic Initiatives
Key strategic initiatives will continue to
include loan and deposit growth through effective relationship
management, targeted solicitation efforts, new product offerings
and continued expansion of the Bank’s branch distribution system on
Long Island and in the New York City boroughs of Queens and
Brooklyn. With respect to loan growth, the Bank will continue
to prudently manage concentration risk and further develop its
broker and correspondent relationships. Small business credit
scored loans, equipment finance loans and SBA loans, along with the
Bank’s traditional commercial and industrial loan products, will be
originated to diversify the Bank’s loan portfolio and help mitigate
the impact of the low rate environment on the Bank’s earnings.
The Bank’s growing branch distribution system
will soon consist of forty-eight branches in Nassau and Suffolk
Counties, Long Island and the boroughs of Queens, Brooklyn and
Manhattan. The Bank expects to open four more branches over
the next 12 months and continues to evaluate sites for further
branch expansion. Three of the new branches will be in Queens
and one will be in Brooklyn. In addition to loan and deposit
growth, management is also focused on growing noninterest income
from existing and potential new sources, which may include the
development or acquisition of fee-based businesses.
Challenges We Face
Since December 2015, there have been four
twenty-five basis point increases in the federal funds target rate
to its current level of 1% to 1.25% and these increases have
exerted upward pressure on non-maturity deposit rates.
Further increases in the federal funds target rate are currently
expected to occur and result in additional upward pressure on
non-maturity deposit rates. At the same time, intermediate
and long-term interest rates remain relatively low and management
expects them to remain so for the foreseeable future.
Additionally, there is significant price competition for loans in
the Bank’s marketplace. These factors have resulted in
suboptimal investing and lending rates.
The banking industry continues to be faced with
new and complex regulatory requirements and enhanced supervisory
oversight. The President has indicated that regulatory relief
and tax reform will be forthcoming, but the timing, magnitude and
positive impact of any such changes are yet to be determined.
In the current environment, banking regulators are increasingly
concerned about, among other things, growth, commercial real estate
concentrations, underwriting of commercial real estate and
commercial and industrial loans, capital levels, cyber security and
predatory sales practices. Regulatory requirements and
enhanced oversight are exerting downward pressure on revenues and
upward pressure on required capital levels and the cost of doing
business.
CONSOLIDATED BALANCE SHEETS |
|
(Unaudited) |
|
|
|
|
|
|
|
|
|
6/30/17 |
|
|
12/31/16 |
|
|
|
|
(dollars in thousands) |
|
|
|
|
|
|
|
|
|
|
|
Assets: |
|
|
|
|
|
Cash and cash equivalents |
|
$ |
56,710 |
|
|
$ |
36,929 |
|
|
|
|
|
|
|
|
Investment securities: |
|
|
|
|
|
Held-to-maturity, at amortized cost (fair value of $9,372 and
$11,637) |
|
|
9,201 |
|
|
|
11,387 |
|
|
Available-for-sale, at fair value |
|
|
739,573 |
|
|
|
815,299 |
|
|
|
|
|
748,774 |
|
|
|
826,686 |
|
|
|
|
|
|
|
|
Loans: |
|
|
|
|
|
Commercial and industrial |
|
|
123,791 |
|
|
|
126,038 |
|
|
Secured by real estate: |
|
|
|
|
|
Commercial mortgages |
|
|
1,128,454 |
|
|
|
1,085,198 |
|
|
Residential mortgages |
|
|
1,427,555 |
|
|
|
1,238,431 |
|
|
Home equity lines |
|
|
88,392 |
|
|
|
86,461 |
|
|
Consumer and other |
|
|
5,864 |
|
|
|
9,293 |
|
|
|
|
|
2,774,056 |
|
|
|
2,545,421 |
|
|
Allowance for loan losses |
|
|
(32,136 |
) |
|
|
(30,057 |
) |
|
|
|
|
2,741,920 |
|
|
|
2,515,364 |
|
|
|
|
|
|
|
|
Restricted stock, at cost |
|
|
30,530 |
|
|
|
31,763 |
|
|
Bank premises and equipment, net |
|
|
35,654 |
|
|
|
34,361 |
|
|
Bank-owned life insurance |
|
|
58,842 |
|
|
|
33,097 |
|
|
Pension plan assets, net |
|
|
17,384 |
|
|
|
17,316 |
|
|
Other assets |
|
|
15,480 |
|
|
|
14,804 |
|
|
|
|
$ |
3,705,294 |
|
|
$ |
3,510,320 |
|
|
|
|
|
|
|
|
Liabilities: |
|
|
|
|
|
Deposits: |
|
|
|
|
|
Checking |
|
$ |
850,316 |
|
|
$ |
808,311 |
|
|
Savings, NOW and money market |
|
|
1,647,281 |
|
|
|
1,519,749 |
|
|
Time, $100,000 and over |
|
|
203,825 |
|
|
|
178,918 |
|
|
Time, other |
|
|
114,186 |
|
|
|
101,739 |
|
|
|
|
|
2,815,608 |
|
|
|
2,608,717 |
|
|
|
|
|
|
|
|
Short-term borrowings |
|
|
136,017 |
|
|
|
207,012 |
|
|
Long-term debt |
|
|
412,362 |
|
|
|
379,212 |
|
|
Accrued expenses and other liabilities |
|
|
9,061 |
|
|
|
9,481 |
|
|
Deferred income taxes payable |
|
|
1,971 |
|
|
|
68 |
|
|
|
|
|
3,375,019 |
|
|
|
3,204,490 |
|
|
|
|
|
|
|
|
Stockholders' Equity: |
|
|
|
|
|
Common stock, par value $.10 per share: |
|
|
|
|
|
Authorized, 40,000,000 shares |
|
|
|
|
|
Issued
and outstanding, 24,129,266 and 23,699,107 shares |
|
|
2,413 |
|
|
|
2,370 |
|
|
Surplus |
|
|
111,569 |
|
|
|
101,738 |
|
|
Retained earnings |
|
|
214,787 |
|
|
|
203,326 |
|
|
|
|
|
328,769 |
|
|
|
307,434 |
|
|
Accumulated other comprehensive income (loss), net of tax |
|
|
1,506 |
|
|
|
(1,604 |
) |
|
|
|
|
330,275 |
|
|
|
305,830 |
|
|
|
|
$ |
3,705,294 |
|
|
$ |
3,510,320 |
|
|
|
|
|
|
|
|
CONSOLIDATED STATEMENTS OF
INCOME |
|
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended |
|
Three Months Ended |
|
|
|
6/30/17 |
|
6/30/16 |
|
6/30/17 |
|
6/30/16 |
|
|
|
(dollars in thousands) |
|
|
|
|
|
|
|
|
|
Interest and dividend
income: |
|
|
|
|
|
|
|
|
|
Loans |
|
$ |
46,637 |
|
$ |
40,055 |
|
$ |
23,718 |
|
$ |
20,241 |
|
Investment securities: |
|
|
|
|
|
|
|
|
|
Taxable |
|
|
4,077 |
|
|
3,910 |
|
|
1,875 |
|
|
2,020 |
|
Nontaxable |
|
|
6,754 |
|
|
6,823 |
|
|
3,377 |
|
|
3,420 |
|
|
|
|
57,468 |
|
|
50,788 |
|
|
28,970 |
|
|
25,681 |
|
Interest
expense: |
|
|
|
|
|
|
|
|
|
Savings, NOW and
money market deposits |
|
|
3,065 |
|
|
2,343 |
|
|
1,574 |
|
|
1,410 |
|
Time deposits |
|
|
2,549 |
|
|
2,674 |
|
|
1,361 |
|
|
1,299 |
|
Short-term borrowings |
|
|
729 |
|
|
131 |
|
|
340 |
|
|
7 |
|
Long-term debt |
|
|
3,672 |
|
|
3,666 |
|
|
1,902 |
|
|
1,692 |
|
|
|
|
10,015 |
|
|
8,814 |
|
|
5,177 |
|
|
4,408 |
|
Net interest income |
|
|
47,453 |
|
|
41,974 |
|
|
23,793 |
|
|
21,273 |
|
Provision for loan
losses |
|
|
2,081 |
|
|
392 |
|
|
1,293 |
|
|
139 |
|
Net
interest income after provision for loan losses |
|
|
45,372 |
|
|
41,582 |
|
|
22,500 |
|
|
21,134 |
|
|
|
|
|
|
|
|
|
|
|
Noninterest
income: |
|
|
|
|
|
|
|
|
|
Investment Management Division income |
|
|
1,050 |
|
|
990 |
|
|
528 |
|
|
514 |
|
Service charges on deposit accounts |
|
|
1,394 |
|
|
1,290 |
|
|
691 |
|
|
656 |
|
Net gains on sales of securities |
|
|
58 |
|
|
1,844 |
|
|
1 |
|
|
1,844 |
|
Other |
|
|
1,967 |
|
|
1,361 |
|
|
1,129 |
|
|
717 |
|
|
|
|
4,469 |
|
|
5,485 |
|
|
2,349 |
|
|
3,731 |
|
Noninterest
expense: |
|
|
|
|
|
|
|
|
|
Salaries |
|
|
11,862 |
|
|
11,049 |
|
|
5,938 |
|
|
5,471 |
|
Employee
benefits |
|
|
3,591 |
|
|
3,449 |
|
|
1,782 |
|
|
1,780 |
|
Occupancy and
equipment |
|
|
5,021 |
|
|
4,579 |
|
|
2,500 |
|
|
2,202 |
|
Debt
extinguishment |
|
|
- |
|
|
1,756 |
|
|
- |
|
|
1,756 |
|
Other |
|
|
5,675 |
|
|
6,470 |
|
|
2,915 |
|
|
3,663 |
|
|
|
|
26,149 |
|
|
27,303 |
|
|
13,135 |
|
|
14,872 |
|
|
|
|
|
|
|
|
|
|
|
Income before income taxes |
|
|
23,692 |
|
|
19,764 |
|
|
11,714 |
|
|
9,993 |
|
Income tax expense |
|
|
5,478 |
|
|
4,400 |
|
|
2,581 |
|
|
2,264 |
|
Net Income |
|
$ |
18,214 |
|
$ |
15,364 |
|
$ |
9,133 |
|
$ |
7,729 |
|
|
|
|
|
|
|
|
|
|
|
EARNINGS PER
SHARE |
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended |
|
Three Months Ended |
|
|
6/30/17 |
|
6/30/16 |
|
6/30/17 |
|
6/30/16 |
|
|
(dollars in thousands, except per share data) |
|
|
|
|
|
|
|
|
|
Net income |
|
$ |
18,214 |
|
|
$ |
15,364 |
|
|
$ |
9,133 |
|
|
$ |
7,729 |
|
Income allocated to
participating securities |
|
|
68 |
|
|
|
65 |
|
|
|
34 |
|
|
|
33 |
|
Income allocated
to common stockholders |
|
$ |
18,146 |
|
|
$ |
15,299 |
|
|
$ |
9,099 |
|
|
$ |
7,696 |
|
|
|
|
|
|
|
|
|
|
Weighted average
shares: |
|
|
|
|
|
|
|
|
Common
shares |
|
|
23,975,687 |
|
|
|
21,902,417 |
|
|
|
24,091,447 |
|
|
|
22,529,255 |
|
Dilutive stock
options and restricted stock units |
|
|
257,063 |
|
|
|
266,330 |
|
|
|
249,901 |
|
|
|
257,975 |
|
|
|
|
24,232,750 |
|
|
|
22,168,747 |
|
|
|
24,341,348 |
|
|
|
22,787,230 |
|
|
|
|
|
|
|
|
|
|
Per share: |
|
|
|
|
|
|
|
|
Basic EPS |
|
$.76 |
|
$.70 |
|
$.38 |
|
$.34 |
Diluted EPS |
|
.75 |
|
.69 |
|
.37 |
|
.34 |
Cash Dividends
Declared |
|
.28 |
|
.27 |
|
.14 |
|
.13 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FINANCIAL RATIOS |
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ROA |
|
|
1.01 |
% |
|
.96% |
|
|
1.00 |
% |
|
.95% |
ROE |
|
|
11.44 |
% |
|
|
11.39 |
% |
|
|
11.16 |
% |
|
|
10.89 |
% |
Net
Interest Margin |
|
|
2.91 |
% |
|
|
2.91 |
% |
|
|
2.89 |
% |
|
|
2.89 |
% |
Dividend
Payout Ratio |
|
|
37.33 |
% |
|
|
39.13 |
% |
|
|
37.84 |
% |
|
|
38.24 |
% |
|
|
|
|
|
|
|
|
|
PROBLEM AND POTENTIAL
PROBLEM LOANS AND ASSETS |
(Unaudited) |
|
|
|
|
|
|
|
|
|
6/30/17 |
|
12/31/16 |
|
|
|
(dollars in thousands) |
|
|
|
|
|
|
|
Loans, excluding
troubled debt restructurings: |
|
|
|
|
|
Past due
30 through 89 days |
|
$ |
4,588 |
|
|
$ |
1,106 |
|
|
Past due
90 days or more and still accruing |
|
|
- |
|
|
|
621 |
|
|
Nonaccrual |
|
|
8,707 |
|
|
|
1,770 |
|
|
|
|
|
13,295 |
|
|
|
3,497 |
|
|
Troubled debt
restructurings: |
|
|
|
|
|
Performing according to their modified terms |
|
|
926 |
|
|
|
757 |
|
|
Past due
30 through 89 days |
|
|
- |
|
|
|
- |
|
|
Past due
90 days or more and still accruing |
|
|
- |
|
|
|
- |
|
|
Nonaccrual |
|
|
275 |
|
|
|
788 |
|
|
|
|
|
1,201 |
|
|
|
1,545 |
|
|
Total past due,
nonaccrual and restructured loans: |
|
|
|
|
|
Restructured and performing according to their modified
terms |
|
|
926 |
|
|
|
757 |
|
|
Past due
30 through 89 days |
|
|
4,588 |
|
|
|
1,106 |
|
|
Past due
90 days or more and still accruing |
|
|
- |
|
|
|
621 |
|
|
Nonaccrual |
|
|
8,982 |
|
|
|
2,558 |
|
|
|
|
|
14,496 |
|
|
|
5,042 |
|
|
Other real estate
owned |
|
|
- |
|
|
|
- |
|
|
|
|
$ |
14,496 |
|
|
$ |
5,042 |
|
|
|
|
|
|
|
|
Allowance for loan
losses |
|
$ |
32,136 |
|
|
$ |
30,057 |
|
|
Allowance for loan
losses as a percentage of total loans |
|
|
1.16 |
% |
|
|
1.18 |
% |
|
Allowance for loan
losses as a multiple of nonaccrual loans |
|
3.6x |
|
11.8x |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
AVERAGE BALANCE SHEET, INTEREST RATES AND
INTEREST DIFFERENTIAL |
|
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended June 30, |
|
|
|
2017 |
|
2016 |
|
|
|
Average |
|
Interest/ |
|
Average |
|
Average |
|
Interest/ |
|
Average |
|
|
|
Balance |
|
Dividends |
|
Rate |
|
Balance |
|
Dividends |
|
Rate |
|
|
|
(dollars in thousands) |
|
Assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-earning bank balances |
|
$ |
24,230 |
|
|
$ |
112 |
|
.93 |
% |
|
$ |
43,242 |
|
|
$ |
111 |
|
.52 |
% |
|
Investment securities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Taxable |
|
|
353,489 |
|
|
|
3,965 |
|
2.24 |
|
|
|
345,785 |
|
|
|
3,799 |
|
2.20 |
|
|
Nontaxable (1) |
|
|
458,100 |
|
|
|
10,391 |
|
4.54 |
|
|
|
460,309 |
|
|
|
10,497 |
|
4.56 |
|
|
Loans
(1) |
|
|
2,674,256 |
|
|
|
46,644 |
|
3.49 |
|
|
|
2,287,335 |
|
|
|
40,062 |
|
3.50 |
|
|
Total
interest-earning assets |
|
|
3,510,075 |
|
|
|
61,112 |
|
3.48 |
|
|
|
3,136,671 |
|
|
|
54,469 |
|
3.47 |
|
|
Allowance for loan losses |
|
|
(31,082 |
) |
|
|
|
|
|
|
|
(27,711 |
) |
|
|
|
|
|
|
Net
interest-earning assets |
|
|
3,478,993 |
|
|
|
|
|
|
|
|
3,108,960 |
|
|
|
|
|
|
|
Cash and
due from banks |
|
|
31,516 |
|
|
|
|
|
|
|
|
30,165 |
|
|
|
|
|
|
|
Premises
and equipment, net |
|
|
34,949 |
|
|
|
|
|
|
|
|
30,958 |
|
|
|
|
|
|
|
Other
assets |
|
|
84,306 |
|
|
|
|
|
|
|
|
58,558 |
|
|
|
|
|
|
|
|
|
$ |
3,629,764 |
|
|
|
|
|
|
|
$ |
3,228,641 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities and Stockholders' Equity: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Savings, NOW & money market deposits |
$ |
1,603,179 |
|
|
|
3,065 |
|
.39 |
|
|
$ |
1,436,975 |
|
|
|
2,343 |
|
.33 |
|
|
Time
deposits |
|
|
294,516 |
|
|
|
2,549 |
|
1.75 |
|
|
|
306,485 |
|
|
|
2,674 |
|
1.75 |
|
|
Total
interest-bearing deposits |
|
|
1,897,695 |
|
|
|
5,614 |
|
.60 |
|
|
|
1,743,460 |
|
|
|
5,017 |
|
.58 |
|
|
Short-term borrowings |
|
|
164,125 |
|
|
|
729 |
|
.90 |
|
|
|
53,690 |
|
|
|
131 |
|
.49 |
|
|
Long-term debt |
|
|
391,278 |
|
|
|
3,672 |
|
1.89 |
|
|
|
371,500 |
|
|
|
3,666 |
|
1.98 |
|
|
Total
interest-bearing liabilities |
|
|
2,453,098 |
|
|
|
10,015 |
|
.82 |
|
|
|
2,168,650 |
|
|
|
8,814 |
|
.82 |
|
|
Checking
deposits |
|
|
847,550 |
|
|
|
|
|
|
|
|
774,043 |
|
|
|
|
|
|
|
Other
liabilities |
|
|
8,142 |
|
|
|
|
|
|
|
|
14,707 |
|
|
|
|
|
|
|
|
|
|
3,308,790 |
|
|
|
|
|
|
|
|
2,957,400 |
|
|
|
|
|
|
|
Stockholders' equity |
|
|
320,974 |
|
|
|
|
|
|
|
|
271,241 |
|
|
|
|
|
|
|
|
|
$ |
3,629,764 |
|
|
|
|
|
|
|
$ |
3,228,641 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
interest income (1) |
|
|
|
$ |
51,097 |
|
|
|
|
|
|
$ |
45,655 |
|
|
|
|
Net
interest spread (1) |
|
|
|
|
|
2.66 |
% |
|
|
|
|
|
2.65 |
% |
|
Net
interest margin (1) |
|
|
|
|
|
2.91 |
% |
|
|
|
|
|
2.91 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
Tax-equivalent basis. Interest income on a tax-equivalent
basis includes the additional amount of interest income that would
have been earned if the Corporation's investment in tax-exempt
loans and investment securities had been made in loans and
investment securities subject to Federal income taxes yielding the
same after-tax income. The tax-equivalent amount of $1.00 of
nontaxable income was $1.54 for each period presented using the
statutory Federal income tax rate of 35%. |
|
Forward Looking Information
This earnings release contains various
“forward-looking statements” within the meaning of that term as set
forth in Rule 175 of the Securities Act of 1933 and Rule 3b-6 of
the Securities Exchange Act of 1934. Such statements are
generally contained in sentences including the words “may” or
“expect” or “could” or “should” or “would” or “believe”. The
Corporation cautions that these forward-looking statements are
subject to numerous assumptions, risks and uncertainties that could
cause actual results to differ materially from those contemplated
by the forward-looking statements. Factors that could cause
future results to vary from current management expectations
include, but are not limited to, changing economic conditions;
legislative and regulatory changes; monetary and fiscal policies of
the federal government; changes in interest rates; deposit flows
and the cost of funds; demands for loan products; competition;
changes in management’s business strategies; changes in accounting
principles, policies or guidelines; changes in real estate values;
and other factors discussed in the “risk factors” section of the
Corporation’s filings with the Securities and Exchange
Commission. The forward-looking statements are made as of the
date of this press release, and the Corporation assumes no
obligation to update the forward-looking statements or to update
the reasons why actual results could differ from those projected in
the forward-looking statements.
For more detailed financial information please
see the Corporation’s quarterly report on Form 10-Q for the quarter
ended June 30, 2017. The Form 10-Q will be available through
the Bank’s website at www.fnbli.com on or about August 9, 2017,
after it is electronically filed with the Securities and Exchange
Commission (“SEC”). Our SEC filings are also available on the
SEC’s website at www.sec.gov. You may also read and copy any
document we file with the SEC at the SEC’s public reference room at
100 F Street, N.E., Room 1580, Washington, DC 20549. You
should call 1-800-SEC-0330 for more information on the public
reference room.
For More Information Contact:
Mark D. Curtis, SEVP, CFO and Treasurer
(516) 671-4900, Ext. 7413
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