BofI Holding, Inc. Announces Record Third Quarter Net Income, Up
40.5%
Loan Portfolio Up 41.3%
SAN DIEGO, CA--(Marketwired - May 6, 2014) - BofI Holding, Inc.
(NASDAQ: BOFI) ("BofI"), parent company of BofI Federal Bank (the
"Bank"), today announced financial results for the third fiscal
quarter ended March 31, 2014. Net income was a record $14.6
million, an increase of 40.5% over net income of $10.4 million for
the quarter ended March 31, 2013. Earnings attributable to BofI's
common stockholders were $14.5 million or $1.00 per diluted share
for the third quarter of fiscal 2014, an increase of 44.6% from
$10.1 million or $0.74 per diluted share for the third quarter
ended March 31, 2013.
Core earnings, a non-GAAP measure which excludes the after-tax
impact of gains and losses associated with our securities
portfolio, increased 47.1% to $15.0 million for the quarter ended
March 31, 2014 compared to $10.2 million for the quarter ended
March 31, 2013.
Third Quarter Fiscal 2014 Financial Summary:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31, |
|
|
|
(Dollars in thousands) |
|
Q3 Fiscal 2014 |
|
Q3 Fiscal 2013 |
|
% Change |
|
Net
Interest Income |
|
$ |
35,663 |
|
$ |
26,202 |
|
36.1 |
% |
Non-Interest Income |
|
$ |
5,212 |
|
$ |
6,834 |
|
(23.7 |
)% |
Net
Income |
|
$ |
14,610 |
|
$ |
10,402 |
|
40.5 |
% |
Core
Earnings1 |
|
$ |
15,000 |
|
$ |
10,199 |
|
47.1 |
% |
Net
Income Attributable to Common Stockholders |
|
$ |
14,533 |
|
$ |
10,053 |
|
44.6 |
% |
Diluted EPS |
|
$ |
1.00 |
|
$ |
0.74 |
|
35.1 |
% |
|
|
|
|
|
|
|
|
|
|
1 Core earnings is a non-GAAP measure that excludes
realized and unrealized gains and losses, net of taxes, associated
with our securities portfolios.
"We posted our ninth consecutive quarter of record earnings and
we made major steps this quarter towards accomplishing several of
our long-term goals," noted Mr. Greg Garrabrants, President and
Chief Executive Officer, and he continued. "First, our record
earnings this quarter were the result of our efforts to expand
organic loan growth and to diversify our lending through selected
C&I loan types. Second, on April 10th we made a major step
toward our goal to significantly expand our prepaid card
sponsorship by announcing a definitive agreement with H&R
Block, the world's largest consumer tax services provider, to
acquire deposits and to provide H&R Block-branded financial
services products including the Emerald Prepaid MasterCard, one of
the top prepaid card programs in the nation. After approval by our
regulators, the agreement to provide H&R Block branded services
could increase revenue $26 to $28 million per year from all
products planned to be offered in the agreements. Third, our
efficiency ratio this quarter decreased to 35.1%, close to our
long-term target of 35%, and helped us increase our return on
average equity to 17.9% for three months ended March 31, 2014. As
we invest in our people and infrastructure to prepare for our
continued growth our efficiency ratio may increase from time to
time, but our goal of creating greater scale economies in our
business remains clear. Finally, net annualized charge-offs to
average loans outstanding for the nine months ended March 31, 2014
was six basis points, on track for the lowest annual level since
fiscal year ended June 30, 2008."
Other Highlights:
- Total assets reached $3,850.8 million, up $889.2 million or
30.0% compared to March 31, 2013
- Loan portfolio grew by $906.1 million or 41.3% compared to
March 31, 2013
- Loan originations for the three months ended March 31, 2014
were $696 million, up 55.9% compared to the quarter ended March 31,
2013
- Deposits grew by $730 million, or 34.7% compared to March 31,
2013
- Asset quality remains strong with total non-performing assets
of 0.50% of total assets and non-performing loans equal to 0.60% of
total loans at March 31, 2014
- Tangible book value increased to $23.51 per share, up $5.34 per
share compared to March 31, 2013
Third Quarter Fiscal 2014 Income Statement Summary During the
quarter ended March 31, 2014, BofI earned $14.6 million or $1.00
per diluted share compared to $10.4 million, or $0.74 per diluted
share for the quarter ended March 31, 2013. Net interest income
increased $9.5 million or 36.1% for the quarter ended March 31,
2014 compared to March 31, 2013. Average earning assets grew
year over year by $861.1 million and our net interest margin was
3.89% compared to 3.74% for the quarters ended March 31, 2014 and
2013, respectively.
The loan loss provision of $1.6 million for the quarter ended
March 31, 2014 was consistent with the quarter ended March 31,
2013. This was the result of improvements in non-performing loans
and delinquencies this quarter compared to the third quarter of
fiscal 2013 and was partially offset by additional provisions
needed for growth in the loan portfolio.
For the third quarter ended March 31, 2014, non-interest income
was $5.2 million compared to $6.8 million for the three months
ended March 31, 2013. The decrease quarter over quarter was
primarily the result of a decline of $3.0 million in mortgage
banking income and an unrealized loss of $0.6 million in our
securities portfolio. The decrease was partially offset by a $1.9
million increase in gain on sale - other and a $0.5 million
increase in banking service fees and other income.
Non-interest expense or operating costs increased $0.4 million
to $14.3 million for the quarter ended March 31, 2014 from $13.9
million for the three months ended March 31, 2013. The increase was
mainly a result of an increase in compensation expense of $0.2
million related to additional staffing added since March 31, 2013,
an increase in professional services of $0.5 million, and an
increase of $0.8 million in data processing and internet expenses.
The increases in staffing and data processing and internet expenses
are primarily due to growth of the Bank's lending and deposit
operations. This increase in operating costs was partially offset
by a decrease in other general and administrative costs of $0.9
million as a result of the cost management initiative implemented
to improve the efficiency and effectiveness of people, vendor and
other costs. We expect non-interest expense to increase in future
periods despite recent cost savings as we plan for future growth
initiatives.
Balance Sheet Summary BofI's total assets increased $760.1
million, or 24.6%, to $3,850.8 million, as of March 31, 2014, up
from $3,090.8 million at June 30, 2013. The loan portfolio
increased a net $844.5 million, primarily from portfolio loan
originations of $1,617.5 million less principal repayments and
other adjustments of $773.0 million. Loans held for sale decreased
$12.3 million. Investment securities decreased $1.4 million as
principal repayments exceeded new security investments. Total
liabilities increased by $689.5 million, or 24.4%, to $3,512.0
million at March 31, 2014, up from $2,822.5 million at June 30,
2013. The increase in total liabilities resulted primarily from
growth in demand and savings deposits of $930.6 million partially
offset by a decline in time deposits of $189.6 million and the
expiration of $50.0 million of repurchase agreements. Stockholders'
equity increased by $70.6 million, or 26.3%, to $338.8 million at
March 31, 2014 from $268.3 million at June 30, 2013. The increase
was primarily the result of $39.9 million in net income and sale of
common stock of $27.6 million, net of commissions and fees.
The Bank's Tier 1 capital was 9.07% at March 31, 2014, compared
to 8.64% at March 31, 2013.
Conference Call A conference call and webcast will be held on
Tuesday, May 6, 2014 at 4:30 PM Eastern / 1:30 PM Pacific. Analysts
and investors may dial in and participate in the question/answer
session. To access the call, please dial: 888-505-4375,
passcode 7186750. The conference call will be webcast live and may
be accessed at BofI's website, http://www.bofiholding.com. For
those unable to listen to the live broadcast, a replay will be
available shortly after the call on BofI's website for 30 days.
About BofI Holding, Inc. and BofI Federal Bank BofI Holding,
Inc. ("BofI") is the holding company for BofI Federal Bank, a
nationwide bank that provides financing for single and multifamily
residential properties, small-to-medium size businesses in target
sectors, and selected specialty finance receivables. With
approximately $3.9 billion in assets, BofI Federal Bank provides
consumer and business banking products through its low-cost
distribution channels and affinity partners. BofI Holding, Inc.'s
common stock is listed on the NASDAQ Global Select Market under the
symbol "BOFI" and is a component of the Russell 3000 Index.
Use of Non-GAAP Financial Measures In addition to the results
presented in accordance with GAAP, this report includes non-GAAP
financial measures such as core earnings. Core earnings exclude
realized and unrealized gains and losses associated with our
securities portfolios. Excluding these gains and losses provides
investors with an understanding of BofI's core lending and mortgage
banking business. Non-GAAP financial measures that have inherent
limitations are not required to be uniformly applied and are not
audited. Readers should be aware of these limitations and should be
cautious as to their use of such measures. Although BofI believes
the non-GAAP financial measures disclosed in this report enhance
investors' understanding of its business and performance, these
non-GAAP measures should not be considered in isolation, or as a
substitute for GAAP basis financial measures. Below is a
reconciliation of GAAP net income to core earnings:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
|
Nine Months Ended |
|
|
|
March 31, |
|
|
March 31, |
|
(Dollars in thousands) |
|
2014 |
|
|
2013 |
|
|
2014 |
|
|
2013 |
|
Net Income |
|
$ |
14,610 |
|
|
$ |
10,402 |
|
|
$ |
39,946 |
|
|
$ |
29,159 |
|
|
Realized securities gains |
|
|
-- |
|
|
|
(420 |
) |
|
|
(208 |
) |
|
|
(420 |
) |
|
Unrealized securities losses |
|
|
666 |
|
|
|
77 |
|
|
|
1,676 |
|
|
|
874 |
|
|
Tax provision |
|
|
(276 |
) |
|
|
140 |
|
|
|
(594 |
) |
|
|
(185 |
) |
|
|
Core
earnings |
|
$ |
15,000 |
|
|
$ |
10,199 |
|
|
$ |
40,820 |
|
|
$ |
29,428 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Forward-Looking Safe Harbor Statement This press release
contains forward-looking statements that involve risks and
uncertainties, including without limitation statements relating to
BofI's financial prospects and other projections of its performance
and asset quality, BofI's ability to grow and increase its
business, diversify its lending, and the anticipated timing and
financial performance of new initiatives. These forward-looking
statements are made on the basis of the views and assumptions of
management regarding future events and performance as of the date
of this press release. Actual results and the timing of events
could differ materially from those expressed or implied in such
forward-looking statements as a result of risks and uncertainties,
including without limitation changes in interest rates, inflation,
government regulation, general economic conditions, conditions in
the real estate markets in which we operate and other factors
beyond our control. These and other risks and uncertainties
detailed in BofI's periodic reports filed with the Securities and
Exchange Commission could cause actual results to differ materially
from those expressed or implied in any forward-looking statements.
You are cautioned not to place undue reliance on these
forward-looking statements, which speak only as of the date of this
press release. All forward-looking statements are qualified in
their entirety by this cautionary statement, and BofI undertakes no
obligation to revise or update any forward-looking statements to
reflect events or circumstances after the date of this press
release.
The following tables set forth certain selected financial data
concerning the periods indicated:
|
|
BOFI HOLDING, INC. AND SUBSIDIARY |
SELECTED CONSOLIDATED FINANCIAL INFORMATION |
(Unaudited - dollars in
thousands) |
|
|
|
March 31, 2014 |
|
June 30, 2013 |
|
March 31, 2013 |
Selected Balance Sheet Data: |
|
|
|
|
|
|
|
|
|
Total
assets |
|
$ |
3,850,825 |
|
$ |
3,090,771 |
|
$ |
2,961,663 |
Loans--net of allowance for loan losses |
|
|
3,101,408 |
|
|
2,256,918 |
|
|
2,195,331 |
Loans
held for sale, at fair value |
|
|
11,255 |
|
|
36,665 |
|
|
32,412 |
Loans
held for sale, lower of cost or fair value |
|
|
53,413 |
|
|
40,326 |
|
|
65,059 |
Allowance for loan losses |
|
|
15,994 |
|
|
14,182 |
|
|
12,286 |
Securities--trading |
|
|
7,599 |
|
|
7,111 |
|
|
7,194 |
Securities--available-for-sale |
|
|
206,166 |
|
|
185,607 |
|
|
159,486 |
Securities--held-to-maturity |
|
|
253,276 |
|
|
275,691 |
|
|
280,908 |
Total
deposits |
|
|
2,832,976 |
|
|
2,091,999 |
|
|
2,102,936 |
Securities sold under agreements to repurchase |
|
|
60,000 |
|
|
110,000 |
|
|
110,000 |
Advances from the Federal Home Loan Bank |
|
|
592,000 |
|
|
590,417 |
|
|
460,000 |
Subordinated debentures and other borrowings |
|
|
5,155 |
|
|
5,155 |
|
|
5,155 |
Total
stockholders' equity |
|
|
338,845 |
|
|
268,262 |
|
|
260,704 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BOFI HOLDING, INC. AND SUBSIDIARY |
|
SELECTED CONSOLIDATED FINANCIAL INFORMATION |
|
(Unaudited - dollars in thousands, except per
share data) |
|
|
|
|
|
At or for the Three Months Ended March 31, |
|
|
At or for the Nine Months Ended March 31, |
|
|
|
2014 |
|
|
2013 |
|
|
2014 |
|
|
2013 |
|
Selected Income Statement Data: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest and dividend income |
|
$ |
45,163 |
|
|
$ |
34,635 |
|
|
$ |
122,736 |
|
|
$ |
99,191 |
|
Interest expense |
|
|
9,500 |
|
|
|
8,433 |
|
|
|
26,135 |
|
|
|
25,568 |
|
Net interest income |
|
|
35,663 |
|
|
|
26,202 |
|
|
|
96,601 |
|
|
|
73,623 |
|
Provision for loan losses |
|
|
1,600 |
|
|
|
1,550 |
|
|
|
3,100 |
|
|
|
6,050 |
|
Net interest income after provision for loan
losses |
|
|
34,063 |
|
|
|
24,652 |
|
|
|
93,501 |
|
|
|
67,573 |
|
Non-interest income |
|
|
5,212 |
|
|
|
6,834 |
|
|
|
17,732 |
|
|
|
19,844 |
|
Non-interest expense |
|
|
14,347 |
|
|
|
13,921 |
|
|
|
44,167 |
|
|
|
38,234 |
|
Income before income tax expense |
|
|
24,928 |
|
|
|
17,565 |
|
|
|
67,066 |
|
|
|
49,183 |
|
Income tax expense |
|
|
10,318 |
|
|
|
7,163 |
|
|
|
27,120 |
|
|
|
20,024 |
|
Net income |
|
$ |
14,610 |
|
|
$ |
10,402 |
|
|
$ |
39,946 |
|
|
$ |
29,159 |
|
Net income attributable to common stock |
|
$ |
14,533 |
|
|
$ |
10,053 |
|
|
$ |
39,714 |
|
|
$ |
28,401 |
|
Per Share Data: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
$ |
1.00 |
|
|
$ |
0.76 |
|
|
$ |
2.78 |
|
|
$ |
2.20 |
|
|
Diluted |
|
$ |
1.00 |
|
|
$ |
0.74 |
|
|
$ |
2.76 |
|
|
$ |
2.12 |
|
|
Book
value per common share |
|
$ |
23.51 |
|
|
$ |
18.17 |
|
|
$ |
23.51 |
|
|
$ |
18.17 |
|
|
Tangible book value per common share |
|
$ |
23.51 |
|
|
$ |
18.17 |
|
|
$ |
23.51 |
|
|
$ |
18.17 |
|
Weighted average number of shares
outstanding: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
|
14,487,173 |
|
|
|
13,293,713 |
|
|
|
14,289,571 |
|
|
|
12,902,600 |
|
Diluted |
|
|
14,562,740 |
|
|
|
13,951,486 |
|
|
|
14,366,398 |
|
|
|
13,675,101 |
|
Common shares outstanding at end of period |
|
|
14,195,307 |
|
|
|
13,049,775 |
|
|
|
14,195,307 |
|
|
|
13,049,775 |
|
Common shares issued at end of period |
|
|
15,130,367 |
|
|
|
13,893,224 |
|
|
|
15,130,367 |
|
|
|
13,893,224 |
|
Performance Ratios and Other Data: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loan originations for investment |
|
$ |
549,743 |
|
|
$ |
166,585 |
|
|
$ |
1,617,484 |
|
|
$ |
778,281 |
|
Loan originations for sale |
|
$ |
146,307 |
|
|
$ |
279,865 |
|
|
$ |
523,561 |
|
|
$ |
815,230 |
|
Loan purchases |
|
$ |
-- |
|
|
$ |
-- |
|
|
$ |
-- |
|
|
$ |
1,541 |
|
Return on average assets |
|
|
1.57 |
% |
|
|
1.45 |
% |
|
|
1.59 |
% |
|
|
1.45 |
% |
Return on average common stockholders' equity |
|
|
17.94 |
% |
|
|
17.75 |
% |
|
|
17.80 |
% |
|
|
17.82 |
% |
Interest rate spread1 |
|
|
3.75 |
% |
|
|
3.62 |
% |
|
|
3.78 |
% |
|
|
3.63 |
% |
Net interest margin2 |
|
|
3.89 |
% |
|
|
3.74 |
% |
|
|
3.92 |
% |
|
|
3.75 |
% |
Efficiency ratio |
|
|
35.10 |
% |
|
|
42.14 |
% |
|
|
38.63 |
% |
|
|
40.91 |
% |
Capital Ratios: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity to assets at end of period |
|
|
8.80 |
% |
|
|
8.80 |
% |
|
|
8.80 |
% |
|
|
8.80 |
% |
Tier 1 leverage (core) capital to adjusted tangible
assets3 |
|
|
9.07 |
% |
|
|
8.64 |
% |
|
|
9.07 |
% |
|
|
8.64 |
% |
Tier 1 risk-based capital ratio3 |
|
|
15.10 |
% |
|
|
14.10 |
% |
|
|
15.10 |
% |
|
|
14.10 |
% |
Total risk-based capital ratio3 |
|
|
15.78 |
% |
|
|
14.78 |
% |
|
|
15.78 |
% |
|
|
14.78 |
% |
Tangible capital to tangible assets3 |
|
|
9.07 |
% |
|
|
8.64 |
% |
|
|
9.07 |
% |
|
|
8.64 |
% |
Asset Quality Ratios: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net annualized charge-offs to average loans
outstanding |
|
|
0.11 |
% |
|
|
0.13 |
% |
|
|
0.06 |
% |
|
|
0.22 |
% |
Non-performing loans to total loans |
|
|
0.60 |
% |
|
|
0.86 |
% |
|
|
0.60 |
% |
|
|
0.86 |
% |
Non-performing assets to total assets |
|
|
0.50 |
% |
|
|
0.71 |
% |
|
|
0.50 |
% |
|
|
0.71 |
% |
Allowance for loan losses to total loans at end of
period |
|
|
0.51 |
% |
|
|
0.55 |
% |
|
|
0.51 |
% |
|
|
0.55 |
% |
Allowance for loan losses to non-performing loans |
|
|
84.17 |
% |
|
|
64.28 |
% |
|
|
84.17 |
% |
|
|
64.28 |
% |
_________________________ 1 Interest rate spread represents the
difference between the annualized weighted average yield on
interest-earning assets and the annualized weighted
average rate paid on interest-bearing liabilities. 2 Net
interest margin represents annualized net interest income as a
percentage of average interest-earning assets. 3 Reflects
regulatory capital ratios of BofI Federal Bank.
Investor Relations Contact: MZ Group, Inc. Johnny Lai, CFA
Senior Analyst 949-259-4989
jlai@mzgroup.us
Axos Finl (delisted) (NASDAQ:BOFI)
Historical Stock Chart
From Jun 2024 to Jul 2024
Axos Finl (delisted) (NASDAQ:BOFI)
Historical Stock Chart
From Jul 2023 to Jul 2024