PARAMUS, N.J., July 20, 2011 /PRNewswire/ -- Hudson City
Bancorp, Inc. (NASDAQ: HCBK), the holding company for Hudson City
Savings Bank, reported today net income of $96.0 million for the quarter ended June 30, 2011 as compared to net income of
$142.6 million for the quarter ended
June 30, 2010. Diluted earnings per
share amounted to $0.19 during the
second quarter of 2011 as compared to diluted earnings per share of
$0.29 for the second quarter of 2010.
The Board of Directors declared a quarterly cash dividend of
$0.08 per share payable on
August 30, 2011 to shareholders of
record on August 5, 2011.
Operating earnings and diluted operating earnings per share
(non-GAAP measures) were $93.7
million and $0.19,
respectively for the linked first quarter of 2011. During the first
quarter of 2011, the Bank completed a restructuring of its balance
sheet (the "Restructuring Transaction") which resulted in the
extinguishment of $12.5 billion of
structured putable borrowings with an average cost of 3.56%. The
extinguishment of the borrowings was funded by the sale of
$8.66 billion of securities with an
average yield of 3.20% and $5.00
billion of new short-term fixed-maturity borrowings with an
average cost of 0.66%. The Restructuring Transaction reduced
after-tax earnings by $649.3 million
resulting in a first quarter net loss of $555.7 million. Please see page 15 of this
press release for a reconciliation of operating earnings to the
Company's earnings reported in accordance with generally accepted
accounting principles. For the six months ended June 30, 2011, the Bank reported a net loss of
$459.7 million as compared to net
income of $291.5 million for the same
period in 2010. Diluted loss per share was $0.93 for the six months ended June 30, 2011 as compared to diluted earnings per
share of $0.59 for the same period in
2010. Operating earnings and diluted operating earnings per
share were $189.7 million and
$0.39, respectively for the six
months ended June 30, 2011 as
compared to $291.5 million and
$0.59, respectively for the same
period in 2010.
Ronald E. Hermance, Jr., Chairman
and Chief Executive Officer commented, "We are pleased with the
performance of our balance sheet after the completion of the first
quarter Restructuring Transaction. Our net interest margin
increased 42 basis points in the second quarter to 2.14% and we
reduced our portfolio of wholesale borrowings as part of the
Restructuring Transaction to improve our interest rate risk
profile. Additionally, during the second quarter of 2011, we
modified $4.0 billion of putable
borrowings to eliminate the put option and further reduced our
interest rate risk. With the first quarter Restructuring
Transaction behind us, we are now looking ahead to opportunities to
increase our mortgage market share. We are expanding our
retail lending market area to include northeast Massachusetts and expect to begin originating
loans in that area during the third quarter. This comes after
our expansion into the greater Philadelphia, Pennsylvania market in 2010.
While low mortgage-related asset yields are restraining
balance sheet growth, we believe that we need to be in a position
to increase our loan production when such growth becomes more
profitable for us. As we have disclosed previously, the
highly publicized foreclosure issues that have recently affected
the nation's largest mortgage loan servicers have resulted in
greater bank regulatory, court and state attorney general scrutiny.
In New Jersey, the state Supreme Court has been reviewing the
foreclosure filing of the largest mortgage lenders and servicers to
determine if they were handled appropriately. On July 12, 2011, a report was issued by one of the
special masters overseeing the cases concluding that Hudson City is meeting the foreclosure filing
standards in New Jersey. I
am very proud that we were the first mortgage lender to satisfy the
court's thorough review of foreclosure filings."
Mr. Hermance continued, "With the economy recovering at a very
slow pace, our balance sheet and future earnings growth continue to
face headwinds. The continued low interest rate environment
does not allow for profitable growth and, while our credit metrics
are stable, the housing markets and employment outlook are weak.
However, we believe that Hudson City has an opportunity to grow its
loan market share when the GSE conforming loan limits are decreased
as expected in October and by expanding our market areas. As
such, we are focused on the things we can accomplish to prepare for
the future. We believe that our commitment to providing
quality services will serve us well in this endeavor. I am
very proud that in the J.D. Power and Associates 2011 U.S. Retail
Banking Satisfaction Study, Hudson
City ranked in the top 25% of banks in the mid-Atlantic region.
Furthermore, we had the highest satisfaction rating of banks
in the mid-Atlantic region with branches in northern New Jersey. It is this type of quality
service that is ingrained in the Hudson City culture and that we will bring to
our new market areas."
Mr. Hermance further commented, "We previously disclosed that we
expected to enter into a memorandum of understanding, commonly
referred to as an MOU, with the Office of Thrift Supervision.
The MOU is an informal supervisory agreement that requires
Hudson City to adopt and implement
enhanced operating policies and procedures and an increased
governance structure over compliance and risk management practices.
During the first six months of 2011, we made significant
changes to our policies and procedures and each of the Company and
the Bank entered into an MOU with the OTS on June 24, 2011. We believe that we are
currently in compliance with the material terms of the MOU and that
the enhancements we agreed to in the MOU are an integral part of
our plan to grow successfully in the future."
Mr. Hermance continued, "I am also pleased to announce that
Tracey Dedrick has joined
Hudson City as Executive Vice
President and Chief Risk Officer. Tracey has over 25 years of
experience in financial and risk management in large financial
services companies such as MetLife and AXA Financial. Ms.
Dedrick is directly responsible for capital markets risk and will
oversee the Company's Enterprise-wide Risk Management program.
In recent months we have enhanced our management team by
adding new positions in key areas important to our long-term
growth, including a Chief Compliance Officer and officers
experienced in asset/liability management, credit analysis,
accounting, information technology ("IT"), mortgage servicing,
credit default management and IT risk."
Mr. Hermance concluded, "We are pleased with our financial
metrics for the second quarter – diluted EPS of $0.19 per share, a Tier I leverage capital ratio
of 8.44%, strong liquidity and a stable credit outlook. The
expansion of our lending markets and the reduction of the GSE
conforming loan limit are both positive factors for Hudson City. The low yields available on
high-quality mortgages, our primary product, as well as low market
interest rates on mortgage-backed securities, have caused us to
significantly reduce our growth. While we look forward to
resuming prudent and profitable growth, we will not compromise our
commitment to investing in high quality assets to do so. We
believe that while our earnings in the near-term may come under
pressure, our restrained growth rate makes sense for the
long-term."
Financial highlights for the second quarter of 2011 are as
follows:
- Diluted earnings per share was $0.19 for the second quarter of 2011 as compared
to diluted earnings per share of $0.29 for the second quarter of 2010. Basic
and diluted loss per common share were both $0.93 for the first six months of 2011 as
compared to both basic and diluted earnings per share of
$0.59 for the same period in 2010.
During the first six months of 2011 we had a net loss of
$459.7 million as compared to net
income of $291.5 million for the
first six months of 2010. Operating earnings amounted to
$189.7 million, or $0.39 per diluted share, for the first six months
of 2011 as compared to $291.5
million, or $0.59 per diluted
share, for the second quarter of 2010. Please see page 15 of
this press release for a reconciliation of operating earnings to
the Company's earnings reported in accordance with generally
accepted accounting principles.
- Net interest income decreased 14.1% to $272.9 million for the second quarter of 2011 and
18.4% to $529.3 million for the six
months ended June 30, 2011 as
compared to the same periods in 2010.
- Our net interest rate spread and net interest margin were 1.94%
and 2.14%, respectively, for the second quarter of 2011 as compared
to 1.50% and 1.72%, respectively for the linked first quarter of
2011 and 1.89% and 2.13%, respectively, for the second quarter of
2010. Our net interest rate spread and net interest margin were
1.71% and 1.92%, respectively, for the first six months of 2011 as
compared to 1.93% and 2.17% for the same period in 2010.
- The provision for loan losses amounted to $30.0 million for the second quarter of 2011 as
compared to $50.0 million for the
second quarter of 2010. For the six months ended June 30, 2011, the provision for loan losses
amounted to $70.0 million as compared
to $100.0 million for the same period
in 2010.
- Our annualized return on average assets and annualized return
on average shareholders' equity for the second quarter of 2011 were
0.74% and 8.00%, respectively. Our annualized return on average
assets and annualized return on average shareholders' equity for
the six months ended June 30, 2011
were (1.65)% and (18.10)%, respectively. Our annualized ratio
of operating earnings to average assets and annualized ratio of
operating earnings to average shareholders' equity, excluding the
Restructuring Transaction, were 0.68% and 7.47%, respectively for
the six months ended June 30, 2011.
Please see page 15 of this press release for a reconciliation
of operating earnings to the Company's earnings reported in
accordance with generally accepted accounting principles.
- Non-interest income amounted to $2.7
million for the second quarter of 2011 and $107.9 million for the first six months of 2011.
Included in non-interest income were net realized securities
gains of $102.5 million for the six
months ended June 30, 2011.
- Deposits increased $381.5
million, or 1.5%, to $25.55
billion at June 30, 2011 from
$25.17 billion at December 31, 2010.
- Borrowings decreased $8.55
billion to $21.13 billion at
June 30, 2011 from $29.68 billion at December
31, 2010. As part of the Restructuring Transaction, we
paid off $12.5 billion of structured
putable borrowings and re-borrowed $5.0
billion of new short-term fixed-maturity borrowings.
- The Bank's Tier 1 leverage capital ratio increased to 8.44% at
June 30, 2011 as compared to 7.95% at
December 31, 2010.
Statement of Financial Condition Summary
Total assets decreased $9.39
billion, or 15.4%, to $51.78
billion at June 30, 2011 from
$61.17 billion at December 31, 2010. The decrease in total assets
reflected an $8.65 billion decrease
in total mortgage-backed securities, a $570.8 million decrease in net loans and a
$382.6 million decrease in total
investment securities.
Our net loans decreased $570.8
million during the first six months of 2011 to $30.20 billion. The decrease in loans primarily
reflects the elevated levels of loan repayments during the first
six months of 2011 as a result of continued low market interest
rates. Historically our focus has been on loan portfolio growth
through the origination of one- to four-family first mortgage loans
in New Jersey, New York, Pennsylvania and Connecticut and, to a lesser extent, the
purchases of mortgage loans. For the first six months of
2011, we originated $2.70 billion and
purchased $290.5 million of loans,
compared to originations of $2.83
billion and purchases of $542.2
million for the first six months of 2010. The
originations and purchases of loans were offset by principal
repayments of $3.46 billion for the
first six months of 2011, as compared to $2.90 billion for the first six months of 2010.
Loan originations declined slightly for the first six months of
2011 as compared to the same period in 2010. In addition,
elevated levels of refinancing activity caused by low market
interest rates have caused increased levels of repayments to
continue during the first six months of 2011. Our loan purchase
activity has also declined as sellers from whom we have
historically purchased loans are either retaining these loans in
their own portfolios or selling them to the government-sponsored
entities ("GSEs"). The GSEs have been actively purchasing
loans as part of their efforts to keep mortgage rates low to
support the housing market during the recent economic recession.
We expect that the amount of loan purchases by the Bank will
continue to be at reduced levels for the near-term.
Total mortgage-backed securities decreased $8.65 billion during the six months ended
June 30, 2011 to $15.38 billion. The decrease was due
primarily to the sale of $8.96
billion of securities, substantially all of which were sold
as part of the Restructuring Transaction. The decrease in
mortgage-backed securities also reflected repayments of
$2.51 billion which were offset by
purchases of $2.97 billion of
mortgage-backed securities issued by GSEs.
Total liabilities decreased $8.77
billion, or 15.8%, to $46.89
billion at June 30, 2011 from
$55.66 billion at December 31, 2010. The decrease in total
liabilities reflected an $8.55
billion decrease in borrowed funds partially offset by a
$381.5 million increase in total
deposits.
The decrease in borrowed funds was primarily a result of the
Restructuring Transaction. As part of the Restructuring
Transaction, we paid off $12.5
billion of structured putable borrowings and re-borrowed
$5.0 billion of new short-term
fixed-maturity borrowings. The extinguishment of structured
putable borrowings was a necessary step in our efforts to reduce
our interest rate risk and eliminate some of the liquidity
uncertainties of borrowings that are putable at the discretion of
the lender. During the second quarter of 2011, we modified
$4.0 billion of structured putable
borrowings to eliminate the put option thereby further reducing our
interest rate risk. Borrowings amounted to $21.13 billion at June 30,
2011 as compared to $29.68
billion at December 31,
2010.
Total shareholders' equity decreased $622.3 million to $4.89
billion at June 30, 2011 from
$5.51 billion at December 31, 2010. The decrease was primarily due
to the net loss of $459.7 million for
the six months ended June 30, 2011.
The decrease was also due to cash dividends paid to common
shareholders of $113.5 million and a
$60.2 million decrease in accumulated
other comprehensive income. At June
30, 2011, our shareholders' equity to asset ratio was 9.44%
and our tangible book value per share was $9.58.
The accumulated other comprehensive income of $25.2 million at June 30,
2011 included a $55.9 million
after-tax net unrealized gain on securities available for sale
($94.6 million pre-tax) and a
$30.7 million after-tax accumulated
other comprehensive loss related to the funded status of our
employee benefit plans. The accumulated other comprehensive
income of $85.4 million at
December 31, 2010 included a
$117.3 million after-tax net
unrealized gain on securities available for sale ($198.3 million pre-tax), partially offset by a
$31.9 million after-tax accumulated
other comprehensive loss related to the funded status of our
employee benefit plans. The change in the unrealized loss on
securities available-for sale was due primarily to the sale of
securities in the first quarter of 2011 which resulted in pre-tax
realized gains of $102.5 million.
Statement of Income Summary
The Federal Open Market Committee of the Board of Governors of
the Federal Reserve System (the "FOMC") noted that the economic
recovery is continuing at a moderate pace, though somewhat more
slowly than the FOMC expected. The FOMC also expressed concerns
regarding recent labor market indicators which have been weaker
than anticipated. The FOMC noted that household spending and
business investment in equipment and software continue to expand.
However, investment in non-residential structures is still weak,
and the housing sector continues to be depressed. The national
unemployment rate remains elevated and increased to 9.2% in June
from 8.8% in March and was slightly lower than the 9.4%
unemployment rate in December 2010.
The FOMC decided to maintain the overnight lending rate at
zero to 0.25% during the second quarter of 2011. As a result,
short-term market interest rates have remained at low levels during
the first six months of 2011. The yields on mortgage-related
assets have also remained at low levels during that same quarter
and, as a result, prepayments of mortgage-related assets continued
at elevated levels.
Net interest income decreased $44.6
million, or 14.1%, to $272.9
million for the second quarter of 2011 as compared to
$317.5 million for the second quarter
of 2010. Our net interest rate spread increased to 1.94% for
the second quarter of 2011 as compared to 1.50% for the first
quarter of 2011 and 1.89% for the second quarter of 2010. Our
net interest margin increased to 2.14% for the second quarter of
2011 as compared to 1.72% for the linked first quarter of 2011 and
2.13% for the second quarter of 2010. These increases were
due primarily to the effects of the Restructuring Transaction which
included the extinguishment of $12.5
billion of structured putable borrowings with an average
cost of 3.56%. The extinguishment of the borrowings was funded by
the sale of $8.66 billion of
securities with an average yield of 3.20% and $5.00 billion of new short-term fixed-maturity
borrowings with an average cost of 0.66%.
Net interest income decreased $119.4
million, or 18.4%, to $529.3
million for the first six months of 2011 as compared to
$648.7 million for the first six
months of 2010. During the first six months of 2011, our net
interest rate spread decreased 22 basis points to 1.71% and our net
interest margin decreased 25 basis points to 1.92% as compared to
2.17% for the same period in 2010.
Notwithstanding the increase in the second quarter of 2011 due
to the effects of the Restructuring Transaction, our net interest
margin decreased for the first six months of 2011 as compared to
the same period in 2010. This decrease was due primarily to
the low market interest rates that resulted in lower yields on our
mortgage-related interest-earning assets as customers refinanced to
lower mortgage rates and our new loan production and asset
purchases were at the current low market interest rates.
Mortgage-related assets represented 88.8% of our average
interest-earning assets during the first six months of 2011.
Total interest and dividend income for the second quarter of
2011 decreased $164.9 million, or
23.0%, to $552.7 million from
$717.6 million for the second quarter
of 2010. The decrease in total interest and dividend income was
primarily due to a decrease of 48 basis points in the annualized
weighted-average yield on total interest-earning assets to 4.35%
for the second quarter of 2011 from 4.83% for the same quarter in
2010. The decrease in total interest and dividend income was
also due to a decrease in the average balance of total
interest-earning assets of $8.64
billion, or 14.5%, to $50.77
billion for the second quarter of 2011 as compared to
$59.41 billion for the second quarter
of 2010. The decrease in the average balance of total
interest-earning assets was due primarily to the Restructuring
Transaction.
Total interest and dividend income for the six months ended
June 30, 2011 decreased $282.2 million, or 19.4%, to $1.17 billion from $1.45
billion for the six months ended June
30, 2010. The decrease in total interest and dividend income
was primarily due to a decrease of 61 basis points in the
annualized weighted-average yield on total interest-earning assets
to 4.29% for the second quarter of 2011 from 4.90% for the same
quarter in 2010. The decrease in total interest and dividend
income was also due to a decrease in the average balance of total
interest-earning assets of $4.73
billion, or 8.0%, to $54.52
billion for the second quarter of 2011 as compared to
$59.25 billion for the second quarter
of 2010. The decrease in the average balance of total
interest-earning assets was due primarily to the effects of the
Restructuring Transaction.
Interest on first mortgage loans decreased $45.8 million to $380.4
million for the second quarter of 2011 as compared to
$426.2 million for the second quarter
of 2010. This was primarily due to a 29 basis point decrease in the
weighted-average yield to 5.10% for the 2011 second quarter from
5.39% for the 2010 second quarter. The decrease in interest
income on mortgage loans was also due to a $1.77 billion decrease in the average balance of
first mortgage loans to $29.85
billion for the second quarter of 2011 from $31.61 billion for the same quarter in 2010. The
decrease in the average yield earned was due to lower market
interest rates on mortgage products and also due to the continued
mortgage refinancing activity.
For the six months ended June 30,
2011, interest on first mortgage loans decreased
$91.1 million, or 10.7%, to
$763.3 million as compared to
$854.4 million for the six months
ended June 30, 2010. This was
primarily due to a 32 basis point decrease in the weighted-average
yield to 5.10% for the six months ended June
30, 2011 as compared to 5.42% for the same period in 2010.
The decrease in interest income on mortgage loans was also
due to a $1.61 billion decrease in
the average balance of first mortgage loans to $29.95 billion for the six months ended
June 30, 2011 from $31.56 billion for the same period in 2010.
Refinancing activity, which resulted in continued elevated
levels of loan repayments, also had an impact on the average
balance of our first mortgage loans during the first six months of
2011.
Interest on mortgage-backed securities decreased $96.9 million to $125.2
million for the second quarter of 2011 as compared to
$222.1 million for the second quarter
of 2010. This decrease was due primarily to a 107 basis point
decrease in the weighted-average yield to 3.25% for the second
quarter of 2011 from 4.32% for the second quarter of 2010. The
decrease in interest on mortgage-backed securities was also due to
a $5.14 billion decrease in the
average balance of mortgage-backed securities to $15.43 billion during the second quarter of 2011
as compared to $20.57 billion for the
second quarter of 2010. The decrease in the average balance
of mortgage-backed securities was due primarily to the effects of
the Restructuring Transaction.
Interest on mortgage-backed securities decreased $145.3 million to $308.5
million for the six months ended June
30, 2011 as compared to $453.8
million for the six months ended June
30, 2010. This decrease was due primarily to a 111
basis point decrease in the weighted-average yield to 3.34% for the
first six months of 2011 from 4.45% for the first six months of
2010. The effect of the decrease in the weighted-average yield was
also due to a $1.96 billion decrease
in the average balance of mortgage-backed securities to
$18.46 billion during the first six
months of 2011 as compared to $20.42
billion for the same period in 2010. The decrease in
the average balance of mortgage-backed securities was due primarily
to the effects of the Restructuring Transaction.
Interest on investment securities decreased $22.0 million to $32.8
million for the second quarter of 2011 as compared to
$54.8 million for the second quarter
of 2010. This decrease was due primarily to a $1.19 billion decrease in the average balance of
investment securities to $3.92
billion for the second quarter of 2011 from $5.11 billion for the second quarter of 2010.
In addition, the average yield earned on investment
securities decreased 95 basis points to 3.34% for the second
quarter of 2011 as compared to 4.29% for the second quarter of
2010. The decrease in the average yield earned reflects
current market interest rates.
For the six months ended June 30,
2011 interest on investment securities decreased
$45.8 million to $66.4 million as compared to $112.2 million for the six months ended
June 30, 2010. This decrease
was due primarily to a $1.25 billion
decrease in the average balance of investment securities to
$3.96 billion for the first six
months of 2011 from $5.21 billion for
the first six months of 2010. In addition, the average yield
of investment securities decreased 96 basis points to 3.35% for the
first six months of 2011 as compared to 4.31% for the same period
in 2010. The decrease in the average yield earned reflects
current market interest rates.
Dividends on Federal Home Loan Bank of New York ("FHLB") stock increased $465,000, or 5.1%, to $9.6
million for the second quarter of 2011 as compared to
$9.2 million for the second quarter
of 2010. This increase was due primarily to a 74 basis point
increase in the average dividend yield earned to 4.89% as compared
to 4.15% for the second quarter of 2010. The effect of the increase
in the average dividend yield was partially offset by a
$94.4 million decrease in the average
balance of FHLB stock to $788.4
million for the second quarter of 2011 as compared to
$882.8 million for the second quarter
of 2010.
Dividends on FHLB stock increased $893,000, or 4.1%, to $22.4 million for the six months ended
June 30, 2011 as compared to
$21.5 million for the comparable
period in 2010. This increase was due primarily to a 52 basis
point increase in the average dividend yield earned to 5.42% as
compared to 4.90% for the first six months of 2010. The effect of
the increase in the average dividend yield was partially offset by
a $50.5 million decrease in the
average balance of FHLB stock to $828.3
million for the first six months of 2011 as compared to
$878.8 million for the same period in
2010.
Interest on Federal funds sold amounted to $707,000 for the second quarter of 2011 as
compared to $576,000 for the second
quarter of 2010. The average balance of Federal funds sold
amounted to $480.4 million for the
second quarter of 2011 as compared to $886.4
million for the second quarter of 2010. The yield
earned on Federal funds sold was 0.29% for the 2011 second quarter
and 0.26% for the 2010 second quarter. The decrease in the
average balance of Federal funds sold is primarily a result of the
repayment of short-term borrowings which were used to help fund the
Restructuring Transaction.
Interest on Federal funds sold amounted to $1.4 million for the six months ended
June 30, 2011 as compared to
$1.0 million for the first six months
of 2010. The average balance of Federal funds sold amounted
to $1.01 billion for the first six
months of 2011 as compared to $838.1
million for the same period in 2010. The yield earned
on Federal funds sold was 0.28% for the six months ended
June 30, 2011 and 0.25% for the six
months ended June 30, 2010. The
increase in the average balance of Federal funds sold is primarily
a result of the timing of the debt extinguishments and the proceeds
from securities sales and new borrowings in the Restructuring
Transaction.
Total interest expense for the quarter ended June 30, 2011 decreased $120.3 million, or 30.1%, to $279.8 million from $400.1
million for the quarter ended June
30, 2010. This decrease was primarily due to an
$8.10 billion, or 14.8%, decrease in
the average balance of total interest-bearing liabilities to
$46.57 billion for the quarter ended
June 30, 2011 compared with
$54.67 billion for the second quarter
of 2010. The decrease was also due to a 53 basis point decrease in
the weighted-average cost of total interest-bearing liabilities to
2.41% for the quarter ended June 30,
2011 compared with 2.94% for the quarter ended June 30, 2010. The decrease in the average
balance of total interest-bearing liabilities was due to the
reduction of total borrowings as part of the Restructuring
Transaction.
For the six months ended June 30,
2011 total interest expense decreased $162.9 million, or 20.3%, to $640.9 million from $803.8
million for the six months ended June
30, 2010. This decrease was primarily due to a 39
basis point decrease in the weighted-average cost of total
interest-bearing liabilities to 2.58% for the six months ended
June 30, 2011 compared with 2.97% for
the six months ended June 30, 2010.
The decrease was also due to a $4.53
billion, or 8.3%, decrease in the average balance of total
interest-bearing liabilities to $50.04
billion for the six months ended June
30, 2011 compared with $54.57
billion for the six months ended June
30, 2010. The decrease in the average balance of total
interest-bearing liabilities was due to the reduction of total
borrowings as part of the Restructuring Transaction.
Interest expense on deposits decreased $11.3 million, or 11.8%, to $84.4 million for the second quarter of 2011 from
$95.7 million for the second quarter
of 2010. This decrease is due primarily to a decrease in the
average cost of interest-bearing deposits of 19 basis points to
1.36% for the second quarter of 2011 as compared to 1.55% for the
second quarter of 2010. The effect of the decrease in the
average cost of deposits was partially offset by a $277.6 million increase in the average balance of
interest-bearing deposits to $24.97
billion during the second quarter of 2011 as compared to
$24.69 billion for the second quarter
of 2010.
For the six months ended June 30,
2011, interest expense on deposits decreased $30.9 million, or 15.5%, to $168.7 million from $199.6
million for the six months ended June
30, 2010. This decrease is due primarily to a decrease
in the average cost of interest-bearing deposits of 27 basis points
to 1.37% for the first six months of 2011 as compared to 1.64% for
the first six months of 2010. The effect of the decrease in
the average cost of deposits was partially offset by a $304.0 million increase in the average balance of
interest-bearing deposits to $24.90
billion during the first six months of 2011 as compared to
$24.60 billion for the first six
months of 2010.
The decrease in the average cost of deposits during 2011
reflected lower market interest rates and our decision to lower
deposit rates to slow deposit growth. At June 30, 2011, time deposits scheduled to mature
within one year totaled $9.21 billion
with an average cost of 1.27%. These time deposits are
scheduled to mature as follows: $3.46
billion with an average cost of 1.02% in the third quarter
of 2011, $2.76 billion with an
average cost of 1.39% in the fourth quarter of 2011, $1.76 billion with an average cost of 1.59% in
the first quarter of 2012 and $1.23
billion with an average cost of 1.24% in the second quarter
of 2012. Based on our deposit retention experience and
current pricing strategy, we anticipate that a significant portion
of these time deposits will remain with us as renewed time deposits
or as transfers to other deposit products at the prevailing
rate.
Interest expense on borrowed funds decreased $108.9 million to $195.5
million for the second quarter of 2011 as compared to
$304.4 million for the second quarter
of 2010. This decrease was primarily due to a $8.38 billion decrease in the average balance of
borrowed funds to $21.60 billion for
the second quarter of 2011 as compared to $29.98 billion for the second quarter of 2010.
This decrease was also due to a 44 basis point decrease in
the weighted-average cost of borrowed funds to 3.63% for the second
quarter of 2011 as compared to 4.07% for the second quarter of
2010. The decrease in the average balance and cost of our
borrowings is due to the effects of the Restructuring Transaction.
For the six months ended June 30,
2011 interest expense on borrowed funds decreased
$131.9 million to $472.3 million as compared to $604.2 million for the six months ended
June 30, 2010. This decrease was
primarily due to a $4.85 billion
decrease in the average balance of borrowed funds to $25.13 billion for the first six months of 2011
as compared to $29.98 billion for the
first six months of 2010. This decrease was also due to a 27
basis point decrease in the weighted-average cost of borrowed funds
to 3.79% for the first six months of 2011 as compared to 4.06% for
the first six months of 2010. The decrease in the average
balance and cost of our borrowings is due to the effects of the
Restructuring Transaction.
Borrowings amounted to $21.13
billion at June 30, 2011 with
an average cost of 3.71%. Borrowings scheduled to mature over
the next 12 months are as follows: $900.0
million with an average cost of 0.94% in the third quarter
of 2011, $750.0 million with an
average cost of 0.55% in the fourth quarter of 2011, $900.0 million with an average cost of 0.98% in
the first quarter of 2012 and $750.0
million with an average cost of 0.74% in the second quarter
of 2012.
The provision for loan losses amounted to $30.0 million for the quarter ended June 30, 2011 as compared to $50.0 million for the quarter ended June 30, 2010. The decrease in our
provision for loan losses during the second quarter of 2011 as
compared to the same period in 2010 was a result of a stabilization
in both the level of charge-offs and the growth of non-performing
loans as well as a decrease in the size of the loan portfolio.
Non-performing loans, defined as non-accruing loans and
accruing loans delinquent 90 days or more, amounted to $914.2 million at June 30,
2011 compared with $871.3
million at December 31, 2010.
The ratio of non-performing loans to total loans was 3.01% at
June 30, 2011 compared with 2.82% at
December 31, 2010. The highly
publicized foreclosure issues that have recently affected the
nation's largest mortgage loan servicers have resulted in greater
bank regulatory, court and state attorney general scrutiny.
As a result, our foreclosure process and the time to complete
a foreclosure have been delayed. We are now experiencing a
time frame to repayment or foreclosure ranging from 30 to 36 months
from the initial non-performing period. This protracted
foreclosure process delays our ability to resolve non-performing
loans through the sale of the underlying collateral and our ability
to maximize any recoveries.
Loans delinquent 30 to 59 days amounted to $408.5 million at June 30,
2011 as compared to $418.9
million at December 31, 2010.
Loans delinquent 60 to 89 days amounted to $170.4 million at June 30,
2011 as compared to $193.2
million at December 31, 2010.
The allowance for loans losses amounted to $262.3 million at June 30,
2011 as compared to $236.6
million at December 31, 2010.
The allowance for loan losses as a percent of total loans and
as a percent of non-performing loans was 0.86% and 28.69%,
respectively at June 30, 2011, as
compared to 0.77% and 27.15%, respectively at December 31, 2010. The increases in these
ratios were due to our consideration of the weak economic
conditions during 2010 and the first six months of 2011,
particularly prolonged elevated levels of unemployment and
underemployment, and continued weak conditions in the housing
markets in our primary lending area, in our determination of the
allowance for loan losses.
Net charge-offs amounted to $23.0
million for the quarter ended June
30, 2011 as compared to net charge-offs of $22.8 million for the same quarter in 2010.
The ratio of net charge-offs to average loans was 0.30% for
the three months ended June 30, 2011
as compared to 0.29% for the same period in 2010. For the six
months ended June 30, 2011, net
charge-offs amounted to $44.3 million
as compared to $47.1 million of net
charge-offs for the same period in 2010. The ratio of net
charge-offs to average loans was 0.29% for the six months ended
June 30, 2011 as compared to 0.30%
for the same period in 2010.
Total non-interest income was $2.7
million for the second quarter 2011 as compared to
$33.2 million for the same quarter in
2010. Included in non-interest income for the second quarter of
2010 were net gains on securities transactions of $30.6 million which resulted from the sale of
$515.2 million of mortgage-backed
securities available-for-sale. There were no security sales
during the three months ended June 30,
2011.
Total non-interest income was $107.9
million for the six months ended June
30, 2011 as compared to $66.2
million for the same period in 2010. Included in
non-interest income for the six months ended June 30, 2011 were net gains on securities
transactions of $102.5 million which
resulted from the sale of $9.04
billion of securities available-for-sale.
Substantially all of the proceeds from the sale of securities
were used to repay borrowings as part of the Restructuring
Transaction. Included in non-interest income for the six
months ended June 30, 2010 were net
gains on securities transactions of $61.4
million which resulted from the sale of $1.09 billion of mortgage-backed securities
available-for-sale.
Total non-interest expense amounted to $85.8 million for the second quarter of 2011 as
compared to $64.6 million for the
second quarter of 2010. This increase was due primarily to a
$19.9 million increase in Federal
deposit insurance assessments and a $4.1
million increase in other non-interest expense, partially
offset by a $2.9 million decrease in
compensation and employee benefits.
Compensation and employee benefit costs decreased $2.9 million, or 8.8%, to $29.9 million for the second quarter of 2011 as
compared to $32.8 million for the
same period in 2010. This decrease was primarily due to a
$4.7 million decrease in expense
related to our stock benefit plans. This decrease was partially
offset by a $687,000 increase in
medical expenses, a $379,000 increase
in pension costs and a $749,000
increase in compensation costs. The increase in compensation
costs was due primarily to normal increases in salary as well as
additional full time employees. At June 30, 2011, we had 1,577 full-time equivalent
employees as compared to 1,562 at December
31, 2010 and 1,557 at June 30,
2010.
Federal deposit insurance expense increased $19.9 million, or 149.6%, to $33.2 million for the second quarter of 2011 from
$13.3 million for the second quarter
of 2010. This increase was due primarily to the new deposit
assessment methodology adopted by the Federal Deposit Insurance
Corporation that became effective on April
1, 2011 and which redefined the assessment base as average
consolidated total assets minus average tangible equity.
Previously, deposit insurance assessments were based on the
amount of deposits.
Included in other expense for the second quarter of 2011 were
write-downs on foreclosed real estate and net losses on the sale of
foreclosed real estate of $2.1
million as compared to $173,000 for the second quarter of 2010.
This increase was due primarily to increased activity in
foreclosed real estate. We sold 45 properties during the
second quarter of 2011 and had 123 properties in foreclosed real
estate, 54 of which were under contract to sell as of June 30, 2011. For the second quarter of
2010, we sold 8 properties and had 52 properties in foreclosed real
estate, of which 9 were under contract to sell as of June 30, 2010.
Total non-interest expense amounted to $1.33 billion for the six months ended
June 30, 2011 as compared to
$131.1 million for the six months
ended June 30, 2010. Included
in total non-interest expense for the first six months of 2011 was
a $1.17 billion loss on the
extinguishment of debt related to the Restructuring Transaction.
Compensation and employee benefit costs decreased $6.2 million, or 9.2%, to $60.8 million for the first six months of 2011 as
compared to $67.0 million for the
same period in 2010. The decrease in compensation costs is
primarily due to a $10.5 million
decrease in expense related to our stock benefit plans. This
decrease was partially offset by an increase in medical expenses of
$2.3 million and a $1.7 million increase in compensation costs due
primarily to normal increases in salary as well as additional full
time employees.
For the six months ended June 30,
2011 Federal deposit insurance increased $23.6 million, or 91.1%, to $49.5 million from $25.9
million for the six months ended June
30, 2010.
Included in other non-interest expense for the six months ended
June 30, 2011 were write-downs on
foreclosed real estate and net losses on the sale of foreclosed
real estate, of $2.8 million as
compared to $1.5 million for the
comparable period in 2010. We sold 74 properties during the
first six months of 2011 as compared to 38 properties for the same
period in 2010.
Our efficiency ratio was 31.14% for the 2011 second quarter as
compared to 18.42% for the 2010 second quarter. For the six
months ended June 30, 2011, our
efficiency ratio was 28.63% compared with 18.34% for the
corresponding 2010 period. The efficiency ratio is calculated by
dividing non-interest expense, excluding the loss on the
extinguishment of debt, by the sum of net interest income and
non-interest income, excluding net securities gains from the
Restructuring Transaction. Our annualized ratio of
non-interest expense to average total assets for the second quarter
of 2011 was 0.67% as compared to 0.43% for the second quarter of
2010. Our annualized ratio of non-interest expense to average
total assets for the six months ended June
30, 2011 was 4.79% compared with 0.43% for the corresponding
period in 2010. Excluding the loss on the extinguishment of debt,
our annualized ratio of operating non-interest expense to average
total assets was 0.56% for the first six months of 2011. Please see
page 15 of this press release for a reconciliation of operating
earnings to the Company's earnings reported in accordance with
generally accepted accounting principles and a calculation of the
efficiency ratio.
Income tax expense amounted to $63.8
million for the second quarter of 2011 compared with income
tax expense $93.5 million for the
same quarter in 2010. Our effective tax rate for the second
quarter of 2011 was 39.92% compared with 39.61% for the second
quarter of 2010. Income tax benefit amounted to $299.5 million for the six months ended
June 30, 2011 compared with income
tax expense $192.3 million for the
six months ended June 30, 2010.
Hudson City Bancorp, Inc. maintains its corporate offices in
Paramus, New Jersey. Hudson City
Savings Bank, a well-established community financial institution
serving its customers since 1868, is ranked in the top twenty-five
U.S. financial institutions by asset size and is the largest thrift
institution headquartered in New
Jersey. Hudson City Savings Bank currently operates a
total of 135 branch offices in the New
York metropolitan area.
Forward-Looking Statements
This release may contain certain "forward looking statements"
within the meaning of the Private Securities Litigation Reform Act
of 1995, that are based on certain assumptions and describe future
plans, strategies and expectations of Hudson City Bancorp, Inc.
Such forward-looking statements may be identified by the use
of such words as "may," "believe," "expect," "anticipate,"
"should," "plan," "estimate," "predict," "continue," and
"potential" or the negative of these terms or other comparable
terminology. Examples of forward-looking statements include,
but are not limited to, estimates with respect to the financial
condition, results of operations and business of Hudson City
Bancorp, Inc. and Hudson City Bancorp, Inc.'s plans, objectives,
expectations and intentions, and other statements contained in this
release that are not historical facts. Hudson City Bancorp,
Inc.'s ability to predict results or the actual effect of future
plans or strategies is inherently uncertain and actual results and
performance could differ materially from those contemplated or
implied by these forward-looking statements. They can be affected
by inaccurate assumptions Hudson City Bancorp, Inc. might make or
by known or unknown risks and uncertainties. Factors that could
cause assumptions to be incorrect include, but are not limited to,
changes in interest rates, general economic conditions, and
legislative, regulatory and public policy changes. These risks and
uncertainties should be considered in evaluating forward-looking
statements and undue reliance should not be placed on such
statements. For a summary of important factors that could
affect Hudson City's
forward-looking statements, please refer to Hudson City's filings with the Securities and
Exchange Commission available at www.sec.gov. Hudson City
Bancorp does not intend to update any of the forward-looking
statements after the date of this release or to conform these
statements to actual events.
TABLES
FOLLOW
|
|
|
|
Hudson City
Bancorp, Inc. and Subsidiary
Consolidated
Statements of Financial Condition
|
|
|
|
|
June
30,
2011
|
|
December
31,
2010
|
|
(In thousands, except share and
per share amounts)
|
(unaudited)
|
|
|
|
|
|
|
|
|
Assets:
|
|
|
|
|
Cash and due from
banks
|
$
146,701
|
|
$
175,769
|
|
Federal funds sold and other
overnight deposits
|
566,950
|
|
493,628
|
|
Total cash and cash equivalents
|
713,651
|
|
669,397
|
|
|
|
|
|
|
Securities available for
sale:
|
|
|
|
|
Mortgage-backed
securities
|
10,484,264
|
|
18,120,537
|
|
Investment
securities
|
7,221
|
|
89,795
|
|
Securities held to
maturity:
|
|
|
|
|
Mortgage-backed
securities
|
4,896,216
|
|
5,914,372
|
|
Investment
securities
|
3,638,950
|
|
3,939,006
|
|
Total securities
|
19,026,651
|
|
28,063,710
|
|
|
|
|
|
|
Loans
|
30,373,476
|
|
30,923,897
|
|
Net deferred loan
costs
|
92,026
|
|
86,633
|
|
Allowance for loan
losses
|
(262,306)
|
|
(236,574)
|
|
Net loans
|
30,203,196
|
|
30,773,956
|
|
|
|
|
|
|
Federal Home Loan Bank of New
York stock
|
767,064
|
|
871,940
|
|
Foreclosed real estate,
net
|
38,364
|
|
45,693
|
|
Accrued interest
receivable
|
211,541
|
|
245,546
|
|
Banking premises and equipment,
net
|
70,970
|
|
69,444
|
|
Goodwill
|
152,109
|
|
152,109
|
|
Other assets
|
595,093
|
|
274,238
|
|
Total Assets
|
$
51,778,639
|
|
$
61,166,033
|
|
|
|
|
|
|
Liabilities and Shareholders’
Equity:
|
|
|
|
|
Deposits:
|
|
|
|
|
Interest-bearing
|
$
24,969,778
|
|
$
24,605,896
|
|
Noninterest-bearing
|
584,823
|
|
567,230
|
|
Total deposits
|
25,554,601
|
|
25,173,126
|
|
|
|
|
|
|
Repurchase agreements
|
7,700,000
|
|
14,800,000
|
|
Federal Home Loan Bank of New
York advances
|
13,425,000
|
|
14,875,000
|
|
Total borrowed funds
|
21,125,000
|
|
29,675,000
|
|
|
|
|
|
|
Due to brokers
|
-
|
|
538,200
|
|
Accrued expenses and other
liabilities
|
211,079
|
|
269,469
|
|
Total liabilities
|
46,890,680
|
|
55,655,795
|
|
|
|
|
|
|
Common stock, $0.01 par value,
3,200,000,000 shares authorized;
|
|
|
|
|
741,466,555 shares issued; 526,707,577 shares
outstanding
|
|
|
|
|
at June 30, 2011 and 526,718,310 shares
outstanding
|
|
|
|
|
at December 31, 2010
|
7,415
|
|
7,415
|
|
Additional paid-in
capital
|
4,713,474
|
|
4,705,255
|
|
Retained earnings
|
2,069,138
|
|
2,642,338
|
|
Treasury stock, at cost;
214,758,978 shares at June 30, 2011 and
|
|
|
|
|
214,748,245 shares outstanding at December 31,
2010
|
(1,726,057)
|
|
(1,725,946)
|
|
Unallocated common stock held by
the employee stock ownership plan
|
(201,227)
|
|
(204,230)
|
|
Accumulated other comprehensive
income, net of tax
|
25,216
|
|
85,406
|
|
Total shareholders’ equity
|
4,887,959
|
|
5,510,238
|
|
Total Liabilities and
Shareholders’ Equity
|
$
51,778,639
|
|
$
61,166,033
|
|
|
|
|
|
|
|
|
|
|
Hudson City
Bancorp, Inc. and Subsidiary
Consolidated
Statements of Income
(Unaudited)
|
|
|
|
|
For the
Three Months
Ended June
30,
|
|
For the Six
Months
Ended June
30,
|
|
|
2011
|
|
2010
|
|
2011
|
|
2010
|
|
|
(In
thousands, except per share data)
|
|
Interest and Dividend
Income:
|
|
|
|
|
|
|
|
|
First mortgage
loans
|
$
380,375
|
|
$
426,244
|
|
$
763,328
|
|
$
854,405
|
|
Consumer and other
loans
|
4,077
|
|
4,654
|
|
8,225
|
|
9,413
|
|
Mortgage-backed
securities held to maturity
|
55,761
|
|
92,319
|
|
116,977
|
|
202,445
|
|
Mortgage-backed
securities available for sale
|
69,415
|
|
129,790
|
|
191,507
|
|
251,382
|
|
Investment securities
held to maturity
|
32,708
|
|
49,627
|
|
65,535
|
|
96,691
|
|
Investment securities
available for sale
|
57
|
|
5,203
|
|
832
|
|
15,549
|
|
Dividends on Federal Home
Loan Bank of New York stock
|
9,632
|
|
9,167
|
|
22,433
|
|
21,540
|
|
Federal funds
sold
|
707
|
|
576
|
|
1,418
|
|
1,025
|
|
|
|
|
|
|
|
|
|
|
Total
interest and dividend income
|
552,732
|
|
717,580
|
|
1,170,255
|
|
1,452,450
|
|
|
|
|
|
|
|
|
|
|
Interest Expense:
|
|
|
|
|
|
|
|
|
Deposits
|
84,360
|
|
95,670
|
|
168,678
|
|
199,589
|
|
Borrowed funds
|
195,463
|
|
304,396
|
|
472,267
|
|
604,202
|
|
|
|
|
|
|
|
|
|
|
Total
interest expense
|
279,823
|
|
400,066
|
|
640,945
|
|
803,791
|
|
|
|
|
|
|
|
|
|
|
Net
interest income
|
272,909
|
|
317,514
|
|
529,310
|
|
648,659
|
|
|
|
|
|
|
|
|
|
|
Provision for Loan
Losses
|
30,000
|
|
50,000
|
|
70,000
|
|
100,000
|
|
|
|
|
|
|
|
|
|
|
Net
interest income after provision for loan losses
|
242,909
|
|
267,514
|
|
459,310
|
|
548,659
|
|
|
|
|
|
|
|
|
|
|
Non-Interest Income:
|
|
|
|
|
|
|
|
|
Service charges and other
income
|
2,732
|
|
2,584
|
|
5,471
|
|
4,814
|
|
Gain on securities
transactions, net
|
-
|
|
30,626
|
|
102,468
|
|
61,394
|
|
Total
non-interest income
|
2,732
|
|
33,210
|
|
107,939
|
|
66,208
|
|
|
|
|
|
|
|
|
|
|
Non-Interest Expense:
|
|
|
|
|
|
|
|
|
Compensation and employee
benefits
|
29,889
|
|
32,789
|
|
60,773
|
|
66,951
|
|
Net occupancy
expense
|
8,030
|
|
7,924
|
|
16,455
|
|
16,271
|
|
Federal deposit insurance
assessment
|
33,198
|
|
13,300
|
|
49,528
|
|
25,927
|
|
Loss on extinguishment of
debt
|
-
|
|
-
|
|
1,172,092
|
|
-
|
|
Other expense
|
14,720
|
|
10,583
|
|
27,557
|
|
21,978
|
|
Total
non-interest expense
|
85,837
|
|
64,596
|
|
1,326,405
|
|
131,127
|
|
|
|
|
|
|
|
|
|
|
Income (loss) before income tax expense (benefit)
|
159,804
|
|
236,128
|
|
(759,156)
|
|
483,740
|
|
|
|
|
|
|
|
|
|
|
Income Tax Expense
(Benefit)
|
63,796
|
|
93,537
|
|
(299,500)
|
|
192,264
|
|
|
|
|
|
|
|
|
|
|
Net
income (loss)
|
$
96,008
|
|
$
142,591
|
|
$
(459,656)
|
|
$
291,476
|
|
|
|
|
|
|
|
|
|
|
Basic Earnings (Loss) Per
Share
|
$
0.19
|
|
$
0.29
|
|
$
(0.93)
|
|
$
0.59
|
|
|
|
|
|
|
|
|
|
|
Diluted Earnings (Loss) Per
Share
|
$
0.19
|
|
$
0.29
|
|
$
(0.93)
|
|
$
0.59
|
|
|
|
|
|
|
|
|
|
|
Weighted Average Number of
Common Shares Outstanding:
|
|
|
|
|
|
|
|
|
Basic
|
494,137,888
|
|
492,888,447
|
|
493,993,685
|
|
492,728,025
|
|
|
|
|
|
|
|
|
|
|
Diluted
|
494,751,960
|
|
494,406,802
|
|
493,993,685
|
|
494,807,046
|
|
|
|
|
|
|
|
|
|
Hudson City
Bancorp, Inc. and Subsidiary
Reconciliation of GAAP and
Operating Earnings
(Unaudited)
|
|
|
|
Operating earnings are not a
measure of performance calculated in accordance with U.S. generally
accepted accounting principles ("GAAP"). However, we believe
that operating earnings are an important indication of earnings
from our core banking operations. Operating earnings
typically exclude the effects of certain non-recurring or unusual
transactions, such as the Restructuring Transaction. We
believe that our presentation of operating earnings provides useful
supplemental information to both management and investors in
evaluating the Company's financial results.
Operating earnings should not be
considered a substitute for net income, earnings per share or any
other data prepared in accordance with GAAP. In addition, we
may calculate operating earnings differently from other companies
reporting data with similar names.
The following is a
reconciliation of the Company's GAAP and operating earnings for the
periods presented:
|
|
|
|
|
|
For the
Three Months Ended
|
|
For the Six
Months Ended
|
|
|
|
June
30,
|
|
March
31,
|
|
June
30,
|
|
|
|
2011
|
|
2010
|
|
2011
|
|
2011
|
|
2010
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP (Loss)
Earnings
|
|
$
96,008
|
|
$
142,591
|
|
$
(555,664)
|
|
$
(459,656)
|
|
$
291,476
|
|
Adjustments to GAAP (loss)
earnings:
|
|
|
|
|
|
|
|
|
|
|
|
Loss on extinguishment
of
debt
|
|
-
|
|
-
|
|
1,172,092
|
|
1,172,092
|
|
-
|
|
Net gain on securities
sales
related to
|
|
|
|
|
|
|
|
|
|
|
|
Restructuring
Transaction (5)
|
|
-
|
|
-
|
|
(98,278)
|
|
(98,278)
|
|
-
|
|
Income tax
effect
|
|
-
|
|
-
|
|
(424,479)
|
|
(424,479)
|
|
-
|
|
Operating
earnings
|
|
96,008
|
|
142,591
|
|
93,671
|
|
189,679
|
|
291,476
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted GAAP (Loss) Earnings per
Share
|
|
$
0.19
|
|
$
0.29
|
|
$
(1.13)
|
|
$
(0.93)
|
|
$
0.59
|
|
Adjustments to GAAP (loss)
earnings:
|
|
|
|
|
|
|
|
|
|
|
|
Loss on extinguishment
of
debt
|
|
-
|
|
-
|
|
2.37
|
|
2.37
|
|
-
|
|
Net gain on securities
sales
related to
|
|
|
|
|
|
|
|
|
|
|
|
Restructuring
Transaction (5)
|
|
-
|
|
-
|
|
(0.20)
|
|
(0.20)
|
|
-
|
|
Income tax
effect
|
|
-
|
|
-
|
|
(0.85)
|
|
(0.85)
|
|
-
|
|
Diluted operating
earnings
per
share
|
|
$
0.19
|
|
$
0.29
|
|
$
0.19
|
|
$
0.39
|
|
$
0.59
|
|
Weighted average number of
common shares outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
494,137,888
|
|
492,888,447
|
|
493,843,304
|
|
493,993,685
|
|
492,728,025
|
|
Diluted
|
|
494,751,960
|
|
494,406,802
|
|
494,502,987
|
|
494,709,376
|
|
494,807,046
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Efficiency
Ratio
|
|
|
|
|
|
|
|
|
|
|
|
Total non-interest
expense
|
|
$
85,837
|
|
$
64,596
|
|
$ 1,240,568
|
|
$ 1,326,405
|
|
$
131,127
|
|
Loss on extinguishment of
debt
|
|
-
|
|
-
|
|
(1,172,092)
|
|
(1,172,092)
|
|
-
|
|
Operating
non-interest
expense
|
|
$
85,837
|
|
$
64,596
|
|
$
68,476
|
|
$
154,313
|
|
$
131,127
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest income
|
|
272,909
|
|
317,514
|
|
256,401
|
|
529,310
|
|
648,659
|
|
Total non-interest
income
|
|
2,732
|
|
33,210
|
|
105,207
|
|
107,939
|
|
66,208
|
|
Net gains on securities
transactions related to
|
|
|
|
-
|
|
|
|
|
|
-
|
|
Restructuring Transaction
(5)
|
|
-
|
|
|
|
(98,278)
|
|
(98,278)
|
|
|
|
Operating non-interest
income
|
|
2,732
|
|
33,210
|
|
6,929
|
|
9,661
|
|
66,208
|
|
Total operating
income
|
|
$
275,641
|
|
$
350,724
|
|
$
263,330
|
|
$
538,971
|
|
$
714,867
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating efficiency ratio
(4)
|
|
31.14%
|
|
18.42%
|
|
26.00%
|
|
28.63%
|
|
18.34%
|
|
Ratio of operating earnings to
average assets (1) (2)
|
|
0.74%
|
|
0.93%
|
|
0.63%
|
|
0.68%
|
|
0.96%
|
|
Ratio of operating earnings to
average equity (1) (3)
|
|
8.00%
|
|
10.42%
|
|
6.99%
|
|
7.47%
|
|
10.69%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Ratios are
annualized.
(2) Calculated by dividing
annualized operating earnings by average assets
(3) Calculated by dividing
annualized operating earnings by average shareholders'
equity
(4) Calculated by dividing
operating non-interest expense by total operating income
(5) Total net securities gains
amounted to $102.5 million and $61.4 million for the six months
ended June 30, 2011 and 2010, respectively Total net securities
gains amounted to $102.5 million for the three months ended March
31, 2011.
|
|
|
|
|
|
|
|
|
|
|
|
|
Hudson City
Bancorp, Inc. and Subsidiary
Consolidated
Average Balance Sheets
(Unaudited)
|
|
|
|
|
|
|
For the
Three Months Ended June 30,
|
|
|
|
|
|
2011
|
|
2010
|
|
|
|
Average
Balance
|
|
Interest
|
|
Average
Yield/
Cost
|
|
Average
Balance
|
|
Interest
|
|
Average
Yield/
Cost
|
|
|
|
|
|
(Dollars in
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-earnings
assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
First mortgage loans, net
(1)
|
$ 29,845,530
|
|
$ 380,375
|
|
5.10
|
%
|
$ 31,614,795
|
|
$ 426,244
|
|
5.39
|
%
|
|
|
Consumer and other
loans
|
313,139
|
|
4,077
|
|
5.21
|
|
349,749
|
|
4,654
|
|
5.32
|
|
|
|
Federal funds sold and other
overnight deposits
|
480,382
|
|
707
|
|
0.29
|
|
886,378
|
|
576
|
|
0.26
|
|
|
|
Mortgage-backed securities at
amortized cost
|
15,427,817
|
|
125,176
|
|
3.25
|
|
20,570,629
|
|
222,109
|
|
4.32
|
|
|
|
Federal Home Loan Bank
stock
|
788,405
|
|
9,632
|
|
4.89
|
|
882,819
|
|
9,167
|
|
4.15
|
|
|
|
Investment securities, at
amortized cost
|
3,919,585
|
|
32,765
|
|
3.34
|
|
5,109,046
|
|
54,830
|
|
4.29
|
|
|
|
|
Total interest-earning
assets
|
50,774,858
|
|
552,732
|
|
4.35
|
|
59,413,416
|
|
717,580
|
|
4.83
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Noninterest-earnings assets
(4)
|
1,390,039
|
|
|
|
|
|
1,600,216
|
|
|
|
|
|
|
|
|
Total Assets
|
$ 52,164,897
|
|
|
|
|
|
$ 61,013,632
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities and Shareholders’
Equity:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing
liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Savings accounts
|
$
867,141
|
|
1,399
|
|
0.65
|
|
$
834,784
|
|
1,555
|
|
0.75
|
|
|
|
Interest-bearing transaction
accounts
|
2,016,548
|
|
4,013
|
|
0.80
|
|
2,374,298
|
|
6,288
|
|
1.06
|
|
|
|
Money market accounts
|
7,914,933
|
|
20,689
|
|
1.05
|
|
5,179,001
|
|
12,958
|
|
1.00
|
|
|
|
Time deposits
|
14,169,657
|
|
58,259
|
|
1.65
|
|
16,302,646
|
|
74,869
|
|
1.84
|
|
|
|
|
Total interest-bearing
deposits
|
24,968,279
|
|
84,360
|
|
1.36
|
|
24,690,729
|
|
95,670
|
|
1.55
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Repurchase agreements
|
7,720,330
|
|
86,795
|
|
4.51
|
|
15,100,000
|
|
154,992
|
|
4.12
|
|
|
|
Federal Home Loan Bank of New
York advances
|
13,881,044
|
|
108,668
|
|
3.14
|
|
14,875,000
|
|
149,404
|
|
4.03
|
|
|
|
|
Total borrowed funds
|
21,601,374
|
|
195,463
|
|
3.63
|
|
29,975,000
|
|
304,396
|
|
4.07
|
|
|
|
|
Total interest-bearing
liabilities
|
46,569,653
|
|
279,823
|
|
2.41
|
|
54,665,729
|
|
400,066
|
|
2.94
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Noninterest-bearing
liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Noninterest-bearing
deposits
|
577,051
|
|
|
|
|
|
594,131
|
|
|
|
|
|
|
|
Other noninterest-bearing
liabilities
|
216,418
|
|
|
|
|
|
278,876
|
|
|
|
|
|
|
|
|
Total noninterest-bearing
liabilities
|
793,469
|
|
|
|
|
|
873,007
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total liabilities
|
47,363,122
|
|
|
|
|
|
55,538,736
|
|
|
|
|
|
|
Shareholders’ equity
|
4,801,775
|
|
|
|
|
|
5,474,896
|
|
|
|
|
|
|
|
|
Total Liabilities and
Shareholders’ Equity
|
$ 52,164,897
|
|
|
|
|
|
$ 61,013,632
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest income/net interest
rate spread (2)
|
|
|
$ 272,909
|
|
1.94
|
|
|
|
$ 317,514
|
|
1.89
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest-earning assets/net
interest margin (3)
|
$
4,205,205
|
|
|
|
2.14
|
%
|
$
4,747,687
|
|
|
|
2.13
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ratio of interest-earning assets
to
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
interest-bearing
liabilities
|
|
|
|
|
1.09
|
x
|
|
|
|
|
1.09
|
x
|
|
(1) Amount includes deferred
loan costs and non-performing loans and is net of the allowance for
loan losses.
(2) Determined by subtracting
the annualized weighted average cost of total interest-bearing
liabilities from the annualized weighted average yield on total
interest-earning assets.
(3) Determined by dividing
annualized net interest income by total average interest-earning
assets.
(4) Includes the average balance
of principal receivable related to FHLMC mortgage-backed securities
of $133.0 million and $397.8 million for the quarters ended June
30, 2011 and 2010, respectively.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Hudson City
Bancorp, Inc. and Subsidiary
Consolidated
Average Balance Sheets
(Unaudited)
|
|
|
|
|
|
|
For the Six
Months Ended June 30,
|
|
|
|
|
|
2011
|
|
2010
|
|
|
|
Average
Balance
|
|
Interest
|
|
Average
Yield/
Cost
|
|
Average
Balance
|
|
Interest
|
|
Average
Yield/
Cost
|
|
|
|
|
|
(Dollars in
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-earnings
assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
First mortgage loans, net
(1)
|
$ 29,947,703
|
|
$ 763,328
|
|
5.10
|
%
|
$ 31,555,931
|
|
$ 854,405
|
|
5.42
|
%
|
|
|
Consumer and other
loans
|
317,250
|
|
8,225
|
|
5.19
|
|
354,169
|
|
9,413
|
|
5.32
|
|
|
|
Federal funds sold and other
overnight deposits
|
1,007,679
|
|
1,418
|
|
0.28
|
|
838,112
|
|
1,025
|
|
0.25
|
|
|
|
Mortgage-backed securities at
amortized cost
|
18,455,170
|
|
308,484
|
|
3.34
|
|
20,417,100
|
|
453,827
|
|
4.45
|
|
|
|
Federal Home Loan Bank
stock
|
828,288
|
|
22,433
|
|
5.42
|
|
878,816
|
|
21,540
|
|
4.90
|
|
|
|
Investment securities, at
amortized cost
|
3,958,925
|
|
66,367
|
|
3.35
|
|
5,205,697
|
|
112,240
|
|
4.31
|
|
|
|
|
Total interest-earning
assets
|
54,515,015
|
|
1,170,255
|
|
4.29
|
|
59,249,825
|
|
1,452,450
|
|
4.90
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Noninterest-earnings assets
(4)
|
1,358,562
|
|
|
|
|
|
1,617,883
|
|
|
|
|
|
|
|
|
Total Assets
|
$ 55,873,577
|
|
|
|
|
|
$ 60,867,708
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities and Shareholders’
Equity:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing
liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Savings accounts
|
$
863,895
|
|
2,772
|
|
0.65
|
|
$
815,904
|
|
3,022
|
|
0.75
|
|
|
|
Interest-bearing transaction
accounts
|
2,064,324
|
|
8,159
|
|
0.80
|
|
2,289,876
|
|
13,797
|
|
1.22
|
|
|
|
Money market accounts
|
7,451,303
|
|
38,556
|
|
1.04
|
|
5,221,284
|
|
29,688
|
|
1.15
|
|
|
|
Time deposits
|
14,522,391
|
|
119,191
|
|
1.66
|
|
16,270,803
|
|
153,082
|
|
1.90
|
|
|
|
|
Total interest-bearing
deposits
|
24,901,913
|
|
168,678
|
|
1.37
|
|
24,597,867
|
|
199,589
|
|
1.64
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Repurchase agreements
|
10,687,277
|
|
226,488
|
|
4.27
|
|
15,100,000
|
|
306,421
|
|
4.09
|
|
|
|
Federal Home Loan Bank of New
York advances
|
14,447,292
|
|
245,779
|
|
3.43
|
|
14,875,000
|
|
297,781
|
|
4.04
|
|
|
|
|
Total borrowed funds
|
25,134,569
|
|
472,267
|
|
3.79
|
|
29,975,000
|
|
604,202
|
|
4.06
|
|
|
|
|
Total interest-bearing
liabilities
|
50,036,482
|
|
640,945
|
|
2.58
|
|
54,572,867
|
|
803,791
|
|
2.97
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Noninterest-bearing
liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Noninterest-bearing
deposits
|
518,199
|
|
|
|
|
|
537,283
|
|
|
|
|
|
|
|
Other noninterest-bearing
liabilities
|
240,871
|
|
|
|
|
|
304,347
|
|
|
|
|
|
|
|
|
Total noninterest-bearing
liabilities
|
759,070
|
|
|
|
|
|
841,630
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total liabilities
|
50,795,552
|
|
|
|
|
|
55,414,497
|
|
|
|
|
|
|
Shareholders’ equity
|
5,078,025
|
|
|
|
|
|
5,453,211
|
|
|
|
|
|
|
|
|
Total Liabilities and
Shareholders’ Equity
|
$ 55,873,577
|
|
|
|
|
|
$ 60,867,708
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest income/net interest
rate spread (2)
|
|
|
$ 529,310
|
|
1.71
|
|
|
|
$ 648,659
|
|
1.93
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest-earning assets/net
interest margin (3)
|
$
4,478,533
|
|
|
|
1.92
|
%
|
$
4,676,958
|
|
|
|
2.17
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ratio of interest-earning assets
to
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
interest-bearing
liabilities
|
|
|
|
|
1.09
|
x
|
|
|
|
|
1.09
|
x
|
|
(1) Amount includes deferred
loan costs and non-performing loans and is net of the allowance for
loan losses.
(2) Determined by subtracting
the annualized weighted average cost of total interest-bearing
liabilities from the annualized weighted average yield on total
interest-earning assets.
(3) Determined by dividing
annualized net interest income by total average interest-earning
assets.
(4) Includes the average balance
of principal receivable related to FHLMC mortgage-backed securities
of $166.5 million and $154.2 million for the six
months ended June 30, 2011 and 2010, respectively.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Hudson City
Bancorp, Inc. and Subsidiary
Book Value
Calculations
|
|
|
|
|
|
June
30,
2011
|
|
(In thousands, except share and
per share amounts)
|
|
|
|
|
|
Shareholders’ equity
|
$
4,887,959
|
|
Goodwill and other intangible
assets
|
(155,972)
|
|
Tangible Shareholders'
equity
|
$
4,731,987
|
|
|
|
|
Book Value Share
Computation:
|
|
|
Issued
|
741,466,555
|
|
Treasury
shares
|
(214,758,978)
|
|
Shares outstanding
|
526,707,577
|
|
Unallocated ESOP
shares
|
(32,233,188)
|
|
Unvested RRP
shares
|
(150,300)
|
|
Shares in
trust
|
(187,802)
|
|
Book value shares
|
494,136,287
|
|
|
|
|
Book value per share
|
$
9.89
|
|
|
|
|
Tangible book value per
share
|
$
9.58
|
|
|
|
Hudson City
Bancorp, Inc.
Other
Financial Data
Securities Portfolio at June 30,
2011
|
|
|
|
|
Amortized
Cost
|
|
Estimated
Fair
Value
|
|
Unrealized
Gain/(Loss)
|
|
|
|
|
(dollars in
thousands)
|
|
|
|
Held to Maturity:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mortgage-backed
securities:
|
|
|
|
|
|
|
FHLMC
|
$
939,975
|
|
$
987,625
|
|
$
47,650
|
|
FNMA
|
2,482,804
|
|
2,624,814
|
|
142,010
|
|
FHLMC and FNMA
CMO's
|
1,379,866
|
|
1,465,726
|
|
85,860
|
|
GNMA
|
93,571
|
|
96,946
|
|
3,375
|
|
Total
mortgage-backed securities
|
4,896,216
|
|
5,175,111
|
|
278,895
|
|
|
|
|
|
|
|
|
Investment
securities:
|
|
|
|
|
|
|
United States GSE
debt
|
3,638,950
|
|
3,601,261
|
|
(37,689)
|
|
Total
investment securities
|
3,638,950
|
|
3,601,261
|
|
(37,689)
|
|
|
|
|
|
|
|
|
Total held to
maturity
|
$
8,535,166
|
|
$
8,776,372
|
|
$
241,206
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Available for
sale:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mortgage-backed
securities:
|
|
|
|
|
|
|
FHLMC
|
$
4,006,482
|
|
$
4,052,820
|
|
$
46,338
|
|
FNMA
|
5,152,251
|
|
5,184,079
|
|
31,828
|
|
FHLMC and FNMA
CMO's
|
92,549
|
|
93,745
|
|
1,196
|
|
GNMA
|
1,138,860
|
|
1,153,620
|
|
14,760
|
|
Total
mortgage-backed securities
|
10,390,142
|
|
10,484,264
|
|
94,122
|
|
|
|
|
|
|
|
|
Investment
securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity
securities
|
6,767
|
|
7,221
|
|
454
|
|
Total
investment securities
|
6,767
|
|
7,221
|
|
454
|
|
|
|
|
|
|
|
|
Total available for
sale
|
$
10,396,909
|
|
$
10,491,485
|
|
$
94,576
|
|
|
|
|
|
|
|
Hudson City
Bancorp, Inc.
Other
Financial Data
Loan Data at June 30,
2011:
|
|
|
|
|
Non-Performing
Loans
|
|
Total
Loans
|
|
|
Loan
Balance
|
|
Number
|
|
Percent
of
Total
Loans
|
|
Loan
Balance
|
|
Number
|
Percent
of
Total
Loans
|
|
|
(dollars in
thousands)
|
|
First Mortgage Loans:
|
|
|
|
|
|
|
|
|
|
|
|
One- to four- family
|
$
818,630
|
|
2,272
|
|
2.70%
|
|
$
29,107,114
|
|
69,481
|
95.83%
|
|
FHA/VA
|
75,345
|
|
281
|
|
0.25%
|
|
718,204
|
|
3,477
|
2.36%
|
|
PMI
|
8,943
|
|
29
|
|
0.03%
|
|
197,174
|
|
622
|
0.65%
|
|
Construction
|
7,002
|
|
6
|
|
0.02%
|
|
8,368
|
|
7
|
0.03%
|
|
Commercial
|
531
|
|
2
|
|
0.01%
|
|
42,460
|
|
90
|
0.14%
|
|
Total mortgage loans
|
910,451
|
|
2,590
|
|
3.00%
|
|
30,073,320
|
|
73,677
|
99.01%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Home equity loans
|
3,728
|
|
34
|
|
0.01%
|
|
279,434
|
|
7,444
|
0.92%
|
|
Other loans
|
60
|
|
3
|
|
0.00%
|
|
20,722
|
|
2,211
|
0.07%
|
|
Total
|
$
914,239
|
|
2,627
|
|
3.01%
|
|
$
30,373,476
|
|
83,332
|
100.00%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
- Net charge-offs amounted to $23.0
million for the second quarter of 2011.
- Updated valuations are received on or before the time a loan
becomes 180 days past due. If necessary, we charge-off an
amount to reduce the loan's carrying value to the updated valuation
less estimated selling costs.
- Based on the valuation indices, house prices have declined in
the New York metropolitan area,
where 72.7% of our non-performing loans were located at
June 30, 2011, by approximately 23%
from the peak of the market in 2006 through April 2011 and by 32% nationwide during that
period. From April 2010 to
April 2011, the house price indices
decreased by approximately 3% in the New
York metropolitan area and 4% nationwide.
- Our quantitative analysis of the allowance for loan losses
considers the results of the reappraisal process as well as the
results of our foreclosed property transactions.
- Our qualitative analysis of the allowance for loan losses
includes a further evaluation of economic factors, such as trends
in the unemployment rate, as well as ratio analysis to evaluate the
overall measurement of the allowance for loan losses. This
analysis includes a review of delinquency ratios, house price
indices, net charge-off ratios and the ratio of the allowance for
loan losses to both non-performing loans and total loans.
Foreclosed real estate at June
30, 2011:
|
|
|
|
|
Number
|
|
Carrying
Value
|
|
Number
Under
Contract of
Sale
|
|
|
|
|
(dollars in
thousands)
|
|
|
|
Foreclosed real estate
|
123
|
|
$
38,364
|
|
54
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
- During the first six months of 2011, we sold 74 foreclosed
properties. Write-downs on foreclosed real estate and net losses on
the sale of foreclosed real estate amounted to $2.8 million for the first six months of 2011.
Hudson City
Bancorp, Inc. and Subsidiary
Other
Financial Data
(Unaudited)
|
|
|
At or for
the Quarter Ended
|
|
|
June 30,
2011
|
|
March 31,
2011
|
|
Dec. 31.
2010
|
|
Sept. 30,
2010
|
|
June 30,
2010
|
|
|
(Dollars in
thousands, except per share data)
|
|
Net interest income
|
$
272,909
|
|
$
256,401
|
|
$
251,834
|
|
$
290,334
|
|
$
317,514
|
|
Provision for loan
losses
|
30,000
|
|
40,000
|
|
45,000
|
|
50,000
|
|
50,000
|
|
Non-interest income
|
2,732
|
|
105,207
|
|
62,927
|
|
33,859
|
|
33,210
|
|
Non-interest expense:
|
|
|
|
|
|
|
|
|
|
|
Compensation and
employee
benefits
|
29,889
|
|
30,884
|
|
34,798
|
|
32,054
|
|
32,789
|
|
Other non-interest
expense
|
55,948
|
|
1,209,684
|
|
34,757
|
|
33,652
|
|
31,807
|
|
Total non-interest
expense
|
85,837
|
|
1,240,568
|
|
69,555
|
|
65,706
|
|
64,596
|
|
Income (loss) before income tax
(benefit) expense
|
159,804
|
|
(918,960)
|
|
200,206
|
|
208,487
|
|
236,128
|
|
Income tax (benefit)
expense
|
63,796
|
|
(363,296)
|
|
79,045
|
|
83,918
|
|
93,537
|
|
Net (loss) income
|
$
96,008
|
|
$
(555,664)
|
|
$
121,161
|
|
$
124,569
|
|
$
142,591
|
|
Total assets
|
$
51,778,639
|
|
$
52,429,066
|
|
$
61,166,033
|
|
$
60,616,632
|
|
$
60,933,134
|
|
Loans, net
|
30,203,196
|
|
30,182,380
|
|
30,773,956
|
|
31,626,561
|
|
32,062,829
|
|
Mortgage-backed
securities
|
|
|
|
|
|
|
|
|
|
|
Available for
sale
|
10,484,264
|
|
10,540,674
|
|
18,120,537
|
|
14,961,441
|
|
13,825,644
|
|
Held to
maturity
|
4,896,216
|
|
5,304,263
|
|
5,914,372
|
|
6,777,579
|
|
7,619,996
|
|
Other securities
|
|
|
|
|
|
|
|
|
|
|
Available for
sale
|
7,221
|
|
7,122
|
|
89,795
|
|
90,797
|
|
366,937
|
|
Held to
maturity
|
3,638,950
|
|
3,938,950
|
|
3,939,006
|
|
4,939,922
|
|
5,139,794
|
|
Deposits
|
25,554,601
|
|
25,461,079
|
|
25,173,126
|
|
24,914,621
|
|
25,168,465
|
|
Borrowings
|
21,125,000
|
|
22,025,000
|
|
29,675,000
|
|
29,825,000
|
|
29,975,000
|
|
Shareholders’ equity
|
4,887,959
|
|
4,728,847
|
|
5,510,238
|
|
5,622,770
|
|
5,543,256
|
|
Performance Data:
|
|
|
|
|
|
|
|
|
|
|
Return on average assets
(1)
|
0.74%
|
|
-3.73%
|
|
0.80%
|
|
0.82%
|
|
0.93%
|
|
Return on average equity
(1)
|
8.00%
|
|
-41.49%
|
|
8.50%
|
|
8.86%
|
|
10.42%
|
|
Net interest rate spread
(1)
|
1.94%
|
|
1.50%
|
|
1.48%
|
|
1.73%
|
|
1.89%
|
|
Net interest margin
(1)
|
2.14%
|
|
1.72%
|
|
1.73%
|
|
1.97%
|
|
2.13%
|
|
Non-interest expense to average
assets (1) (4)
|
0.67%
|
|
8.44%
|
|
0.46%
|
|
0.43%
|
|
0.43%
|
|
Compensation and benefits to
total revenue (5)
|
10.84%
|
|
8.54%
|
|
11.06%
|
|
9.89%
|
|
9.35%
|
|
Efficiency ratio (2)
|
31.14%
|
|
26.00%
|
|
22.10%
|
|
20.27%
|
|
18.42%
|
|
Dividend payout ratio
|
42.11%
|
|
NM
|
|
60.00%
|
|
60.00%
|
|
51.72%
|
|
Per Common Share
Data:
|
|
|
|
|
|
|
|
|
|
|
Basic (loss) earnings per common
share
|
$0.19
|
|
($1.13)
|
|
$0.25
|
|
$0.25
|
|
$0.29
|
|
Diluted (loss) earnings per
common share
|
$0.19
|
|
($1.13)
|
|
$0.25
|
|
$0.25
|
|
$0.29
|
|
Book value per share
(3)
|
$9.89
|
|
$9.58
|
|
$11.16
|
|
$11.40
|
|
$11.25
|
|
Tangible book value per share
(3)
|
$9.58
|
|
$9.26
|
|
$10.85
|
|
$11.08
|
|
$10.93
|
|
Dividends per share
|
$0.08
|
|
$0.15
|
|
$0.15
|
|
$0.15
|
|
$0.15
|
|
Capital Ratios:
|
|
|
|
|
|
|
|
|
|
|
Equity to total assets
(consolidated)
|
9.44%
|
|
9.02%
|
|
9.01%
|
|
9.28%
|
|
9.10%
|
|
Tier 1 leverage capital
(Bank)
|
8.44%
|
|
8.12%
|
|
7.95%
|
|
7.91%
|
|
7.75%
|
|
Total risk-based capital
(Bank)
|
20.27%
|
|
19.66%
|
|
23.04%
|
|
22.42%
|
|
21.90%
|
|
Other Data:
|
|
|
|
|
|
|
|
|
|
|
Full-time equivalent
employees
|
1,577
|
|
1,569
|
|
1,562
|
|
1,573
|
|
1,557
|
|
Number of branch
offices
|
135
|
|
135
|
|
135
|
|
135
|
|
134
|
|
Asset Quality
Data:
|
|
|
|
|
|
|
|
|
|
|
Total non-performing
loans
|
$
914,239
|
|
$
886,530
|
|
$
871,259
|
|
$
837,469
|
|
$
790,137
|
|
Number of non-performing
loans
|
2,627
|
|
2,524
|
|
2,430
|
|
2,291
|
|
2,110
|
|
Total number of loans
|
83,332
|
|
82,976
|
|
83,929
|
|
85,953
|
|
87,041
|
|
Total non-performing
assets
|
$
952,603
|
|
$
930,541
|
|
$
916,952
|
|
$
877,745
|
|
$
811,827
|
|
Non-performing loans to total
loans
|
3.01%
|
|
2.92%
|
|
2.82%
|
|
2.64%
|
|
2.46%
|
|
Non-performing assets to total
assets
|
1.84%
|
|
1.77%
|
|
1.50%
|
|
1.45%
|
|
1.33%
|
|
Allowance for loan
losses
|
$
262,306
|
|
$
255,283
|
|
$
236,574
|
|
$
216,283
|
|
$
192,983
|
|
Allowance for loan losses to
non-performing loans
|
28.69%
|
|
28.80%
|
|
27.15%
|
|
25.83%
|
|
24.42%
|
|
Allowance for loan losses to
total loans
|
0.86%
|
|
0.84%
|
|
0.77%
|
|
0.68%
|
|
0.60%
|
|
Provision for loan
losses
|
$
30,000
|
|
$
40,000
|
|
$
45,000
|
|
$
50,000
|
|
$
50,000
|
|
Net charge-offs
|
$
22,977
|
|
$
21,290
|
|
$
24,709
|
|
$
26,701
|
|
$
22,846
|
|
Ratio of net charge-offs to
average loans (1)
|
0.30%
|
|
0.28%
|
|
0.32%
|
|
0.33%
|
|
0.29%
|
|
Net losses (gains) on foreclosed
real estate
|
$
2,053
|
|
$
776
|
|
$
1,585
|
|
$
(391)
|
|
$
173
|
|
|
|
|
|
|
|
|
|
|
|
(1) Ratios are
annualized.
(2) Computed by dividing
non-interest expense by the sum of net interest income and
non-interest income. For the quarter ended March 31, 2011,
non-interest expense excludes the loss on debt extinguishments and
non-interest income excludes securities gains from the
Restructuring Transaction. See page 15 for a calculation of
the efficiency ratio.
(3) Please see page 13 for a
calculation of book value per share and tangible book value per
share.
|
|
(4) Computed by dividing
non-interest expense by average assets.
(5) Computed by dividing
compensation and benefits by the sum of net interest income and
non-interest income
NM - not meaningful
|
|
|
|
|
SOURCE Hudson City Bancorp, Inc.