BOCA RATON, Fla., Oct. 21,
2013 /PRNewswire/ -- (NASDAQ Global Select: FUBC) -- 1st
United Bancorp, Inc. ("1st United") reported net income
of $4.3 million ($0.13 per share) for the nine months ended
September 30, 2013 as compared to net
income of $3.0 million ($0.09 per share) for the nine months ended
September 30, 2012. 1st
United reported net income of $880,000 ($0.03 per
share) for the three months ended September
30, 2013, which included approximately $1.8 million in one-time acquisition and
integration charges and banking center closure costs, as compared
to net income of $1.6 million
($0.05 per share) for the three
months ended September 30, 2012.
Highlights for the quarter and nine months ended September 30, 2013 follow:
Financial Condition
- Total assets at September 30,
2013 were $1.72 billion, as
compared to approximately $1.55
billion at June 30, 2013 and
$1.57 billion at December 31, 2012. The growth during the
three and nine months ended September 30,
2013 related primarily to the acquisition of Enterprise
Bancorp, Inc. (EBI) on July 1, 2013
and new loan growth in the quarter.
- Total assets acquired in connection with the EBI acquisition
included $44.6 million in cash,
$4.0 million in securities and
$159.2 million in loans.
1st United did not acquire any non-performing assets as
part of the transaction. Total deposits acquired were
$177.2 million. Goodwill
recorded in connection with the transaction was $5.7 million with merger and integration expenses
incurred during the quarter ended September
30, 2013 of $1.6 million.
1st United does not anticipate any additional
integration costs as a result of the EBI acquisition in future
quarters.
- Total deposits at September 30,
2013 were $1.40 billion, as
compared to approximately $1.29
billion at June 30, 2013 and
$1.30 billion at December 31, 2012. Non-interest bearing
deposits were approximately 33% of total deposits at September 30, 2013 as compared to approximately
35% of total deposits at June 30,
2013 and 33% of total deposits at December 31, 2012.
- Total risk-based capital ratio, Tier 1 capital ratio, and
leverage ratio for 1st United at September 30, 2013 were 15.82%, 14.91% and 9.81%,
respectively, and exceeded all regulatory requirements for "well
capitalized."
Asset Quality
- Total non-performing assets were $38.2
million (2.23% of total assets) at September 30, 2013 representing a $1.5 million decrease as compared to $39.7 million (2.57% of total assets) at
June 30, 2013 and a $4.8 million decrease as compared to the
December 31, 2012 balance of
$42.9 million (2.74% of total
assets).
- Included in the $38.2 million in
non-performing assets at September 30,
2013 were $19.3 million of
assets covered under loss share agreements as compared to total
non-performing assets at June 30,
2013 of $39.7 million, of
which $20.9 million were covered
under loss share agreements. At September 30, 2013, 1st United had
approximately $1.1 million of assets
under agreements to sell at no additional loss which 1st
United anticipates closing during the fourth quarter 2013.
Excluding assets covered by FDIC loss share agreements,
non-performing assets were $18.9
million (1.10% of total assets) at September 30, 2013 as compared to $18.8 million (1.22% of total assets) at
June 30, 2013 and $18.3 million (1.17% of total assets) at
December 31, 2012.
- Classified assets (substandard and special mention) decreased
from $64.8 million at June 30, 2013 to $64.7
million at September 30, 2013.
Classified assets at September 30,
2013 decreased by $26.6
million from $91.3 million at
December 31, 2012. These
decreases were due to resolutions, including sales, payoffs and
transfers to other real estate owned, as well as credit upgrades of
assets which have shown continued improvement.
Operating Results – Quarter ended September 30, 2013
Net income of $880,000 for the
three months ended September 30, 2013
was impacted by the following:
- The net interest margin was 4.9% for the quarter ended
September 30, 2013. The margin
was positively impacted by increased cash flows of assets covered
under loss share agreements which also included resolutions,
including sales, payoffs and transfers to other real estate owned
resulting in additional margin income of $2.8 million or 73 basis points. Exclusive of
this, 1st United's margin would have been approximately 4.15%.
- The provision for loan losses was $745,000 for the quarter ended September 30, 2013.
- Net gains on sales of securities of $93,000 were realized for the quarter ended
September 30, 2013.
- Net gains on sales of other real estate of $179,000 were realized for the quarter ended
September 30, 2013, which primarily
related to assets covered under loss share agreements.
- A charge of approximately $2.6
million was recorded during the quarter related to the
income from the increased cash flows on performing purchased credit
impaired loans and resolution, including sales, payoffs and
transfers to other real estate owned, of assets covered under FDIC
loss sharing agreements. 1st United also took a charge
of approximately $263,000 related to
other real estate, which reduced the FDIC loss share
receivable.
- 1st United incurred one-time merger reorganization
related expenses of $1.6 million
related to the merger and integration of EBI. Expenses
included legal, professional, IT integration and conversion,
severance and lease termination expenses associated with the merger
and integration of operations. 1st United
completed the integration of the EBI operations in late
September 2013 which included the
consolidating of three of its branches into one banking
center.
- During the quarter, 1st United determined to
strategically close one additional banking center which is located
in Broward County, Florida.
The banking center will close in early 2014 with customers serviced
at another 1st United banking center. A related
expense for this closing of $228,000
was incurred during the quarter ended September 30, 2013 and includes termination of
the facilities lease, write-off of leasehold improvements and other
fixed assets and severance expense. The closure of this
location is anticipated to produce an annualized operating expense
savings of approximately $400,000 per
year.
- Inclusive within non-interest expense were write-downs of
$143,000 of other real estate owned
to their fair values due to updated appraisals.
Operating Results – Nine months ended September 30, 2013
Net income of $4.3 million for the
nine months ended September 30, 2013
was impacted by the following:
- The net interest margin was 5.24% for the nine months ended
September 30, 2013. The margin
was positively impacted by increased cash flows of assets covered
under loss share agreements which also included resolutions,
including sales, payoffs and transfers to other real estate owned
of $11.2 million or 107 basis points.
Exclusive of this, 1st United's margin would have been
approximately 4.17% for the nine month period.
- The provision for loan losses was $2.7
million for the nine months ended September 30, 2013.
- Net gains on sales of securities of $824,000 were realized for the nine months ended
September 30, 2013.
- Net gains on sales of other real estate of $1.0 million were realized for the nine months
ended September 30, 2013, which
primarily related to assets covered under loss share
agreements.
- A charge of approximately $10.2
million was recorded during the nine months related to the
income from increased cash flows on performing purchased credit
impaired loans and resolution, including sales, payoffs and
transfers to other real estate owned, of assets covered under FDIC
loss sharing agreements. 1st United also took a charge
of $922,000 related to other real
estate, which reduced the FDIC loss share receivable.
- 1st United incurred initial merger reorganization
related expenses of $1.7 million
related to the merger and integration of EBI for the nine months
ended September 30, 2013.
Expenses included legal, professional, IT integration and
conversion, severance and lease termination expenses associated
with the merger and integration of operations. 1st
United completed the integration of the EBI operations in late
September 2013.
- During the nine months ended September
30, 2013, 1st United determined to strategically
close two existing banking centers with one closed in October 2013 and one anticipated to be closed in
January 2014. The related expense for these closings of
$632,000 included termination of the
facilities lease, write-off of leasehold improvements and other
fixed assets and severance expense. The closure of these
locations is anticipated to produce an annualized operating expense
savings of approximately $800,000 per
year.
- Inclusive within non-interest expense were write-downs of
$785,000 of other real estate owned
to their fair values due to updated appraisals.
Management Comments:
"We are excited to have completed the merger and integration of
EBI during the third quarter of 2013. Our total assets at
September 30, 2013 were $1.7 billion with total deposits at $1.4 billion," said Warren S. Orlando, Chairman. "EBI
contributed one net new banking center and helped towards
leveraging our balance sheet while enhancing our Palm Beach County footprint. We expect
our continued strong capital base, liquidity and overall financial
strength to continue to allow us the opportunity to continue to
expand both organically as well as through potential
acquisitions."
"Our net earnings were $880,000
for the quarter ended September 30,
2013. These results included merger and integration
expenses of $1.6 million, branch
disposal charge for the closing of a branch of $228,000 and write-downs and losses on the sale
of OREO of $336,000. Exclusive
of these charges, our pre-tax earnings would have been $3.5 million and our strongest since the
inception of 1st United. Our margin continues to
remain strong and is driven by our core deposits and low cost of
funds. We currently have approximately 33% of our total
deposits comprised of non-interest bearing deposits at September 30, 2013. Our gross loan
portfolio increased for the quarter. We had originations and
loan advances of $97.3 million which
were partially offset by payoffs and resolutions of $69.2 million. Our new loan pipeline
remains strong moving into the fourth quarter and we continue to
see increased loan production in each of the markets that we
serve," said Rudy E. Schupp, Chief
Executive Officer.
"We recorded $5.7 million in
goodwill from the EBI acquisition. The conversion of systems
was completed by the end of the third quarter, and we incurred
total one-time merger and integration costs of up to $1.7 million, with $1.6
million expensed during the third quarter. We are also
encouraged with the continued improvement in non-performing and
classified assets during the quarter, with a reduction of
$1.5 million in non-performing assets
with no significant change in total classified assets since
June 30, 2013. We continue to work on
cost control efforts and the decision to close two of our existing
banking centers during 2013 are assisting us with those efforts
with annualized expense savings of about $800,000," said John
Marino, President and Chief Financial Officer.
For interested persons, 1st United will be hosting an
investor call to review the quarterly results 11:00 a.m. Eastern Daylight Time on October 22, 2013. The number for the
conference call is (800) 857-9849 (Passcode: 3183056). A
replay of the conference call will be available beginning the
evening of October 22, 2013 until
November 4, 2013 by dialing (866)
490-2548 (domestic), using the passcode 5421.
About 1st United Bancorp, Inc.
1st United is a financial holding company
headquartered in Boca Raton,
Florida. 1st United's principal subsidiary,
1st United Bank, is a Florida chartered commercial bank, which
operates 22 branches in South and Central
Florida, including Brevard,
Broward, Hillsborough, Indian
River, Miami-Dade,
Orange, Palm Beach, and Pinellas Counties.
1st United's principal executive office and mailing
address is One North Federal Highway, Boca Raton, FL 33432 and its telephone number
is (561) 362-3435. 1st United's stock is listed on
the NASDAQ Global Select Market under the symbol "FUBC".
Forward Looking Statements
Any non-historical statements in this press release are
"forward-looking statements" within the meaning of the Private
Securities Litigation Reform Act of 1995. Such
forward-looking statements are based on current plans and
expectations that are subject to uncertainties and risks, which
could cause 1st United's future results to differ
materially. The following factors, among others, could cause
our actual results to differ: our ability to comply with the terms
of loss share agreements with the FDIC; legislative and regulatory
changes, including the Dodd-Frank Wall Street Reform and Consumer
Protection Act and Basel III, the strength of the United States economy in general and the
strength of the local economies in which we conduct operations; the
accuracy of our financial statement estimates and assumptions,
including the estimate of our loan loss provision and the FDIC
receivable; our ability to integrate the business and operations of
companies and banks that we have acquired, and those that we may
acquire in the future; the failure to achieve expected gains,
revenue growth, and/or expense savings from future acquisitions;
the frequency and magnitude of foreclosure of our loans; the
reduction in FDIC insurance on certain non-interest bearing
accounts due to the expiration of the Transaction Account Guarantee
program; increased competition and its effect on pricing including
the impact on our net interest margin from repeal of regulation
Q; our customers' willingness to make timely payments on
their loans; the effects of the health and soundness of other
financial institutions; changes in securities and real estate
markets; changes in monetary and fiscal policies of the U.S.
Government; inflation, interest rate, market, and monetary
fluctuations; the effects of our lack of a diversified loan
portfolio, including the risks of geographic and industry
concentrations; our need and our ability to incur additional debt
or equity financing; the effects of harsh weather conditions,
including hurricanes, and man-made disasters; our ability to comply
with the extensive laws and regulations to which we are subject;
the willingness of clients to accept third-party products and
services rather than our products and services and vice versa;
technological changes; negative publicity and the impact on our
reputation; the effects of security breaches and computer viruses
that may affect our computer systems; changes in consumer spending
and saving habits; changes in accounting principles, policies,
practices or guidelines; limited trading activity of our common
stock; the concentration of ownership of our common stock; our
ability to retain key members of management; anti-takeover
provisions under federal and state law as well as our Articles of
Incorporation and our Bylaws; other risks described from time to
time in our filings with the Securities and Exchange Commission;
and our ability to manage the risks involved in the
foregoing. These factors, as well as additional factors, can
be found in our periodic and other filings with the SEC, which are
available at the SEC's internet site (http://www.sec.gov). Actual
results may differ materially from projections and could be
affected by a variety of factors, including factors beyond our
control. Forward-looking statements in this press release speak
only as of the date of the press release, and 1st United
assumes no obligation to update forward-looking statements or the
reasons why actual results could differ.
|
For the three month
period ended
September 30,
|
|
|
2013
|
|
2012
|
|
INCOME STATEMENT
DATA
(unaudited)
|
|
(Amounts in
thousands,
except per share data)
|
|
|
|
|
|
Interest
income
|
$
|
19,520
|
|
$
|
19,183
|
|
Interest
expense
|
|
920
|
|
|
1,277
|
|
Net interest
income
|
|
18,600
|
|
|
17,906
|
|
Provision for loan
losses
|
|
745
|
|
|
1,050
|
|
Net interest income
after provision for loan losses
|
|
17,855
|
|
|
16,856
|
|
|
|
|
|
|
|
|
|
Net gains on sales of
OREO
|
|
|
179
|
|
|
1,020
|
|
Net gains on sales of
securities
|
|
|
93
|
|
|
—
|
|
Adjustment to FDIC
loss share receivable
|
|
|
(2,835)
|
|
|
(4,150)
|
|
Other non-interest
income
|
|
|
1,252
|
|
|
1,261
|
|
Total non-interest
income
|
|
|
(1,311)
|
|
|
(1,869)
|
|
|
|
|
|
|
|
|
|
Salaries and employee
benefits
|
|
|
6,601
|
|
|
6,157
|
|
Occupancy and
equipment
|
|
|
2,175
|
|
|
2,057
|
|
Merger reorganization
expense
|
|
|
1,618
|
|
|
24
|
|
Disposal of banking
center
|
|
|
228
|
|
|
—
|
|
Other non-interest
expense
|
|
|
4,555
|
|
|
4,215
|
|
Total non-interest
expense
|
|
|
15,177
|
|
|
12,453
|
|
|
|
|
|
|
|
|
|
Income before
taxes
|
|
|
1,367
|
|
|
2,534
|
|
Income tax
expense
|
|
|
487
|
|
|
960
|
|
Net
income
|
|
$
|
880
|
|
$
|
1,574
|
|
|
|
|
|
|
|
|
|
PER SHARE
DATA
|
|
|
|
|
|
|
|
Basic and diluted
earnings per share
|
|
$
|
0.03
|
|
$
|
0.05
|
|
|
|
|
|
|
|
|
|
SELECTED OPERATING
RATIOS
|
|
|
|
|
|
|
|
Return on average
assets
|
|
|
0.20
|
%
|
|
0.40
|
%
|
Return on average
shareholders' equity
|
|
|
1.50
|
%
|
|
2.62
|
%
|
Net interest
margin
|
|
|
4.88
|
%
|
|
5.33
|
%
|
|
|
|
|
|
|
|
|
Average
assets
|
|
$
|
1,736,853
|
|
$
|
1,574,337
|
|
Average shareholders'
equity
|
|
$
|
232,235
|
|
$
|
238,405
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the nine month
period ended
September
30,
|
|
|
|
2013
|
|
2012
|
|
INCOME STATEMENT
DATA
(unaudited)
|
|
|
(Amounts in
thousands,
except per share data)
|
|
|
|
|
|
|
Interest
income
|
|
$
|
57,786
|
|
$
|
54,237
|
|
Interest
expense
|
|
|
2,808
|
|
|
4,191
|
|
Net interest
income
|
|
|
54,978
|
|
|
50,046
|
|
Provision for loan
losses
|
|
|
2,695
|
|
|
5,450
|
|
Net interest income
after provision for loan losses
|
|
52,283
|
|
|
44,596
|
|
|
|
|
|
|
|
|
|
Net gains on sales of
OREO
|
|
|
1,012
|
|
|
2,974
|
|
Net gains on sales of
securities
|
|
|
824
|
|
|
1,673
|
|
Adjustment to FDIC
loss share receivable
|
|
|
(10,576)
|
|
|
(9,268)
|
|
Other non-interest
income
|
|
|
3,722
|
|
|
3,623
|
|
Total non-interest
income
|
|
|
(5,018)
|
|
|
(998)
|
|
|
|
|
|
|
|
|
|
Salaries and employee
benefits
|
|
|
18,828
|
|
|
18,104
|
|
Occupancy and
equipment
|
|
|
6,113
|
|
|
6,022
|
|
Merger reorganization
expense
|
|
|
1,745
|
|
|
1,784
|
|
Disposal of banking
center
|
|
|
632
|
|
|
—
|
|
Other non-interest
expense
|
|
|
13,164
|
|
|
12,880
|
|
Total non-interest
expense
|
|
|
40,482
|
|
|
38,790
|
|
|
|
|
|
|
|
|
|
Income before
taxes
|
|
|
6,783
|
|
|
4,808
|
|
Income tax
expense
|
|
|
2,516
|
|
|
1,807
|
|
Net
income
|
|
$
|
4,267
|
|
$
|
3,001
|
|
|
|
|
|
|
|
|
|
PER SHARE
DATA
|
|
|
|
|
|
|
|
Basic and diluted
earnings per share
|
|
$
|
0.13
|
|
$
|
0.09
|
|
|
|
|
|
|
|
|
|
SELECTED OPERATING
RATIOS
|
|
|
|
|
|
|
|
Return on average
assets
|
|
|
0.35
|
%
|
|
0.26
|
%
|
Return on average
shareholders' equity
|
|
|
2.41
|
%
|
|
1.73
|
%
|
Net interest
margin
|
|
|
5.24
|
%
|
|
5.08
|
%
|
|
|
|
|
|
|
|
|
Average
assets
|
|
$
|
1,620,752
|
|
$
|
1,525,093
|
|
Average shareholders'
equity
|
|
$
|
236,298
|
|
$
|
230,707
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SELECT FINANCIAL
DATA
(unaudited)
|
|
September 30,
2013
|
|
December 31,
2012
|
|
|
|
(Amounts in
thousands,
except per share data)
|
|
|
|
|
|
|
|
|
|
BALANCE SHEET
DATA
|
|
|
|
|
|
|
|
Total
assets
|
|
$
|
1,715,921
|
|
$
|
1,566,779
|
|
Gross
loans
|
|
|
1,121,854
|
|
|
913,168
|
|
Allowance for loan
losses
|
|
|
9,907
|
|
|
9,788
|
|
Net loans
|
|
|
1,112,123
|
|
|
903,600
|
|
Cash and cash
equivalents
|
|
|
67,288
|
|
|
207,117
|
|
Securities available
for sale
|
|
|
341,879
|
|
|
260,122
|
|
Other real estate
owned
|
|
|
16,452
|
|
|
19,529
|
|
Goodwill and other
intangible assets
|
|
|
68,236
|
|
|
61,767
|
|
FDIC loss share
receivable
|
|
|
31,271
|
|
|
46,735
|
|
Deposits
|
|
|
1,399,240
|
|
|
1,303,022
|
|
Non-interest bearing
deposits
|
|
|
467,666
|
|
|
426,968
|
|
Shareholders'
equity
|
|
|
233,684
|
|
|
236,690
|
|
|
|
|
|
|
|
|
|
SELECTED ASSET
QUALITY DATA, CAPITAL AND
ASSET QUALITY RATIOS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity/assets
|
|
|
13.62
|
%
|
|
15.11
|
%
|
Non-accrual and loans
past due greater than 90 days
loans/total loans
|
|
|
1.94
|
%
|
|
2.56
|
%
|
Allowance for loan
losses/total loans
|
|
|
0.88
|
%
|
|
1.07
|
%
|
Allowance for loan
losses/non-accrual loans
|
|
|
45.57
|
%
|
|
45.94
|
%
|
Leverage
ratio
|
|
|
9.81
|
%
|
|
11.44
|
%
|
Tier 1 risk based
capital
|
|
|
14.91
|
%
|
|
21.21
|
%
|
Total risk based
capital
|
|
|
15.82
|
%
|
|
22.43
|
%
|
Book value per
share
|
|
$
|
6.82
|
|
$
|
6.95
|
|
Number of shares of
outstanding common stock
|
|
|
34,288,841
|
|
|
34,070,270
|
|
SOURCE 1st United Bancorp, Inc.