The First of Long Island Corporation (Nasdaq:FLIC), the parent
company of The First National Bank of Long Island, reported
increases in net income and earnings per share for the year and
three months ended December 31, 2015. In the highlights that
follow, all comparisons are of the current year or three month
period to the same period last year.
FULL YEAR 2015 HIGHLIGHTS
- Net Income increased 12.5% to $25.9 million from $23.0
million
- EPS increased 10.9% to $1.83 from $1.65
- Cash Dividends Per Share increased 8.3% to $.78 from
$.72
- Total Assets exceeded $3.1 billion at year
end
- 25.7% growth in the average balance of
Loans
- 15.5% growth in the average balance of
Noninterest-Bearing Checking Deposits
- 15.3% growth in the average balance of Total
Deposits
FOURTH QUARTER HIGHLIGHTS
- Net Income increased 21.2% to $6.6 million from $5.5
million
- EPS increased 17.9% to $.46 from $.39
- Cash Dividends Per Share increased 5.3% to $.20 from
$.19
- The Mortgage Loan Pipeline remained strong at $117
million at quarter end
- The Credit Quality of the Bank’s loan and securities
portfolios remains excellent
Analysis of 2015 Earnings
Net income for 2015 increased $2.9 million over
2014. The increase is attributable to increases in net interest
income of $8.7 million, or 13.0%, and noninterest income, before
securities gains, of $174,000, or 2.4%. The positive impact of
these items on earnings was partially offset by an increase in
noninterest expense, before debt extinguishment costs, of $3.6
million, or 8.5%, and increases in the provision for loan losses
and income tax expense of $1.1 million and $1.4 million,
respectively.
The increase in net interest income was driven
by growth in average interest-earning assets of $365.6 million, or
15.0%, which is primarily comprised of growth in the average
balances of loans of $406.6 million, or 25.7%, and nontaxable
securities of $23.9 million, or 5.8%, partially offset by a
decrease in the average balance of taxable securities of $68.8
million, or 16.2%. The growth in the average balance of loans
includes growth in commercial and industrial loans of $11.3
million, or 14.8%, a large portion of which resulted from the
Bank’s small business credit scored loan initiative. The shift from
taxable securities to better yielding loans and nontaxable
securities partially mitigated the negative impact on net interest
income of a low interest rate environment. The growth in loans and
nontaxable securities of $406.6 million and $23.9 million,
respectively, to the extent not funded by the decline in taxable
securities of $68.8 million, was funded by growth in the average
balances of noninterest-bearing checking deposits of $99.0 million,
or 15.5%, interest-bearing deposits of $194.7 million, or 15.1%,
and long-term debt of $64.5 million, or 21.5%. The increase in
long-term debt resulted from management’s desire to reduce the
impact that an eventual increase in interest rates could have on
the Bank’s earnings.
Intermediate and long-term interest rates remain
low and volatile. In a low interest rate environment: (1) loans are
sometimes originated and investments are sometimes made at yields
lower than existing portfolio yields; (2) some loans prepay in full
resulting in the immediate writeoff of deferred costs while the
rates on other loans are modified downward; (3) prepayment speeds
on mortgage securities are elevated resulting in the faster
amortization of purchase premiums; (4) the benefit of no cost
funding in the form of noninterest-bearing checking deposits and
capital is suppressed; and (5) the Bank’s ability to reduce deposit
rates diminishes. These factors are primarily responsible for a 9
basis point decline in net interest margin and a 6 basis point
decline in net interest spread when comparing 2015 to 2014. These
factors also explain why strong growth in the average balance of
loans of 25.7% was accompanied by lesser growth of 13.0% in net
interest income. Although net interest margin declined when
comparing 2015 to 2014, it was relatively stable throughout 2015
amounting to 2.91% in quarter one, 2.94% in quarters two and three
and 2.98% in quarter four.
The $174,000 increase in noninterest income
before securities gains is primarily attributable to real estate
and sales tax refunds of $204,000 and $91,000, respectively, an
increase in cash value accretion on bank-owned life insurance of
$359,000 and an increase in merchant services income of $76,000.
The positive impact of these items was partially offset by a
decrease in service charges on deposit accounts of $397,000
resulting largely from a decrease in deposit account overdraft
activity and a net gain of $165,000 during 2014 on the sale of
loans held-for-sale. Cash value accretion increased primarily
because of a fourth quarter 2014 purchase of bank-owned life
insurance with an initial cash value of $16.9 million. Also
contributing to the increase in noninterest income was the
successful deployment in recent years of a variety of noninterest
income initiatives including debit cards, ATM banking and merchant
services as noted above. Total income from these initiatives grew
to $834,000 in 2015 compared to $715,000 in 2014.
The increase in noninterest expense, before debt
extinguishment costs, of $3.6 million is primarily attributable to
an increase in salaries of $1.8 million, or 9.5%, an increase in
employee benefits expense of $1.2 million, or 24.6%, a
growth-related increase in the combined amount of FDIC insurance
expense and the Bank’s OCC assessment of $250,000 and a one-time
charge of $77,000 resulting from the termination of certain network
and communication-related contracts. The impact of these items was
partially offset by a decrease in occupancy and equipment expense
of $82,000. The increase in salaries is primarily due to new branch
openings, additions to staff in the back office and normal annual
salary adjustments, partially offset by lower stock-based
compensation expense. The decrease in stock-based compensation
expense is mainly attributable to stock awards granted in the
fourth quarter of 2014 with a value of $358,000 that vested
immediately. The increase in employee benefits expense is largely
due to an increase in incentive compensation cost, an increase in
payroll tax expense resulting from additions to staff, an increase
in group health insurance expense resulting from increases in staff
count and the rates being paid for group health insurance and an
increase in supplemental executive retirement expense. The decrease
in occupancy and equipment expense is primarily attributable to a
decrease in maintenance and repairs expense, mostly offset by
increases in rent, real estate taxes and depreciation of
newly-opened branches and expanded back-office space. Over the last
two years, the Bank opened six new branches, relocated an existing
branch to a larger facility and significantly expanded its loan
operations department.
During the second quarter of 2015 the Bank
completed a deleveraging transaction that involved the sale of
$61.8 million of available-for-sale securities at a gain of
$995,000 and utilization of the resulting proceeds to prepay $63.5
million of long-term debt at a cost of $1,084,000. The primary
purpose of the transaction was to reduce the size of the
Corporation’s balance sheet by eliminating inefficient leverage and
thereby provide capital to accommodate future growth.
The $1.4 million increase in income tax expense
is attributable to an increase in pretax earnings and changes in
New York City income tax law effective January 1, 2015, partially
offset by changes in New York State tax law also effective January
1, 2015. The changes in New York City income tax law resulted in a
one-time charge of $402,000 to establish a New York City deferred
income tax liability as of the effective date of the legislation
and an increase in income tax expense of $41,000 for the
period.
Analysis of Earnings – Fourth Quarter
2015 Versus Fourth Quarter 2014
Net income for the fourth quarter of 2015 was
$6.6 million, an increase of 21.2% over $5.5 million earned in the
same quarter last year. The increase is primarily attributable to
an increase in net interest income of $3.1 million, or 18.2%, net
gains on sales of securities of $191,000 and a decrease in
occupancy and equipment expense of $274,000. The positive impact on
earnings of these items was partially offset by increases in
salaries of $143,000, employee benefits expense of $395,000, other
noninterest expense of $257,000, the provision for loan losses of
$870,000 and income tax expense of $751,000. The increases in net
interest income, salaries, employee benefits expense, other
noninterest expense and income tax expense and the decrease in
occupancy and equipment expense occurred for substantially the same
reasons discussed above with respect to the full year periods. The
increase in the provision for loan losses was primarily
attributable to the fact that the fourth quarter of 2014 included a
decline in average annualized historical losses and an improvement
in economic conditions.
Asset Quality
The Bank’s allowance for loan losses to total
loans (reserve coverage ratio) decreased by 8 basis points from
1.29% at year-end 2014 to 1.21% at December 31, 2015. The decrease
in the reserve coverage ratio is primarily due to a continued
improvement in economic conditions, partially offset by an increase
in specific reserves on loans individually deemed to be
impaired.
The $4.3 million provision for loan losses for
2015 is primarily attributable to loan growth, a $368,000 increase
in specific reserves on loans individually deemed to be impaired
and $282,000 of net chargeoffs, partially offset by a continued
improvement in economic conditions. The $3.2 million provision for
loan losses for 2014 was primarily attributable to loan growth and
net chargeoffs, partially offset by an improvement in economic
conditions, a reduction in watch, special mention and substandard
loans and a decrease in specific reserves on loans individually
deemed to be impaired.
The credit quality of the Bank’s loan portfolio
remains excellent. Nonaccrual loans amounted to $1.4 million, or
.06% of total loans outstanding, at December 31, 2015, compared to
$1.7 million, or .09%, at December 31, 2014. The decrease in
nonaccrual loans is primarily attributable to paydowns and loan
sales. Troubled debt restructurings increased during 2015 to $4.5
million at year end. Of this amount, $3.6 million are performing in
accordance with their modified terms and $900,000 are nonaccrual
and included in the aforementioned amount of nonaccrual loans.
Loans past due 30 through 89 days amounted to $1.0 million, or .04%
of total loans outstanding, at December 31, 2015, compared to $2.2
million, or .12%, at December 31, 2014. Management does not believe
that the increase in troubled debt restructurings is indicative of
deterioration in the overall credit quality of the Bank’s loan
portfolio as the increase was attributed to one lending
relationship.
The credit quality of the Bank’s securities
portfolio also remains excellent. The Bank’s mortgage securities
are backed by mortgages underwritten on conventional terms, with
69% of these securities being full faith and credit obligations of
the U.S. government and the balance being obligations of U.S.
government sponsored entities. The remainder of the Bank’s
securities portfolio principally consists of high quality, general
obligation municipal securities rated AA or better by major rating
agencies. In selecting municipal securities for purchase, the Bank
uses credit agency ratings for screening purposes only and then
performs its own credit analysis. On an ongoing basis, the Bank
periodically assesses the credit strength of the municipal
securities in its portfolio and makes decisions to hold or sell
based on such assessments.
Capital
The Corporation’s Tier 1 leverage, Common Equity
Tier 1 risk-based, Tier 1 risk-based and Total risk-based capital
ratios were approximately 8.0%, 12.9%, 12.9% and 14.2%,
respectively, at December 31, 2015. The strength of the
Corporation’s balance sheet positions the Corporation for continued
growth in a measured and disciplined fashion.
Key Strategic Initiatives
Key strategic initiatives will continue to
include loan and deposit growth through effective relationship
management, targeted solicitation efforts, new product offerings
and continued expansion of the Bank’s branch distribution system.
With respect to loan growth, the Bank plans to continue to
prudently manage concentration risk and further develop its broker
and correspondent relationships. All loans originated through such
relationships are underwritten by Bank personnel. The Bank’s branch
distribution system currently consists of 43 branches located in
Nassau and Suffolk Counties, Long Island, the borough of Queens and
Manhattan. The Bank anticipates opening two new branches during
2016 and on an ongoing basis continues to evaluate sites for
further branch expansion. In addition to loan and deposit growth,
management will also continue to focus on growing noninterest
income from existing and potential new sources.
Challenges We Face
The federal funds target rate increased by
twenty-five basis points in December. Further increases could exert
upward pressure on non-maturity deposit rates. Intermediate and
long-term interest rates are low and volatile and impacted by both
national and global forces. Such rates could remain low for the
foreseeable future and thereby cause both investing and lending
rates to be suboptimal. There is significant price competition for
loans in the Bank’s marketplace and little room for the Bank to
further reduce its deposit rates. Higher yielding loans continue to
prepay and are replaced with lower yielding loans and there is an
ongoing need, from an interest rate risk perspective, to term-fund
a portion of the Bank’s loan growth with time deposits and
wholesale borrowings. In the current interest rate environment, the
spread between lending rates and term-funding rates is relatively
small. These factors will make it difficult to improve net interest
margin and could result in a decline in net interest margin from
its current level and inhibit earnings growth for the foreseeable
future.
The banking industry continues to be faced with
new and complex regulatory requirements and enhanced supervisory
oversight. These factors are exerting downward pressure on revenues
and upward pressure on required capital levels and the cost of
doing business.
CONSOLIDATED BALANCE SHEETS |
|
(Unaudited) |
|
|
|
|
|
|
|
|
|
12/31/15 |
|
12/31/14 |
|
|
|
(in thousands) |
|
|
|
|
|
Assets: |
|
|
|
|
|
Cash and cash equivalents |
|
$ |
39,635 |
|
|
$ |
32,944 |
|
|
|
|
|
|
|
|
Investment securities: |
|
|
|
|
|
Held-to-maturity, at amortized cost
(fair value of $14,910 and $22,870) |
|
|
14,371 |
|
|
|
21,833 |
|
|
Available-for-sale, at fair
value |
|
|
737,700 |
|
|
|
774,145 |
|
|
|
|
|
752,071 |
|
|
|
795,978 |
|
|
|
|
|
|
|
|
Loans held-for-sale |
|
|
105 |
|
|
|
- |
|
|
|
|
|
|
|
|
Loans: |
|
|
|
|
|
Commercial and industrial |
|
|
93,056 |
|
|
|
77,140 |
|
|
Secured by real estate: |
|
|
|
|
|
Commercial mortgages |
|
|
1,036,331 |
|
|
|
858,975 |
|
|
Residential mortgages |
|
|
1,025,215 |
|
|
|
779,994 |
|
|
Home equity lines |
|
|
87,848 |
|
|
|
83,109 |
|
|
Consumer and other |
|
|
5,733 |
|
|
|
5,601 |
|
|
|
|
|
2,248,183 |
|
|
|
1,804,819 |
|
|
Allowance for loan losses |
|
|
(27,256 |
) |
|
|
(23,221 |
) |
|
|
|
|
2,220,927 |
|
|
|
1,781,598 |
|
|
|
|
|
|
|
|
Restricted stock, at cost |
|
|
28,435 |
|
|
|
23,304 |
|
|
Bank premises and equipment,
net |
|
|
30,330 |
|
|
|
27,854 |
|
|
Bank-owned life insurance |
|
|
32,447 |
|
|
|
31,568 |
|
|
Pension plan assets, net |
|
|
14,337 |
|
|
|
16,421 |
|
|
Other assets |
|
|
12,056 |
|
|
|
11,827 |
|
|
|
|
$ |
3,130,343 |
|
|
$ |
2,721,494 |
|
|
Liabilities: |
|
|
|
|
|
Deposits: |
|
|
|
|
|
Checking |
|
$ |
777,994 |
|
|
$ |
655,753 |
|
|
Savings, NOW and money market |
|
|
1,195,968 |
|
|
|
1,000,325 |
|
|
Time, $100,000 and over |
|
|
198,147 |
|
|
|
208,745 |
|
|
Time, other |
|
|
112,566 |
|
|
|
120,202 |
|
|
|
|
|
2,284,675 |
|
|
|
1,985,025 |
|
|
|
|
|
|
|
|
Short-term borrowings |
|
|
211,502 |
|
|
|
136,486 |
|
|
Long-term debt |
|
|
365,712 |
|
|
|
345,000 |
|
|
Accrued expenses and other
liabilities |
|
|
12,313 |
|
|
|
13,247 |
|
|
Deferred income taxes payable |
|
|
5,205 |
|
|
|
8,433 |
|
|
|
|
|
2,879,407 |
|
|
|
2,488,191 |
|
|
Stockholders' Equity: |
|
|
|
|
|
Common stock, par value $.10 per
share: |
|
|
|
|
|
Authorized, 40,000,000 shares |
|
|
|
|
|
Issued and outstanding, 14,116,677
and 13,887,134 shares |
|
|
1,412 |
|
|
|
1,389 |
|
|
Surplus |
|
|
56,931 |
|
|
|
51,009 |
|
|
Retained earnings |
|
|
185,069 |
|
|
|
170,120 |
|
|
|
|
|
243,412 |
|
|
|
222,518 |
|
|
Accumulated other comprehensive
income, net of tax |
|
|
7,524 |
|
|
|
10,785 |
|
|
|
|
|
250,936 |
|
|
|
233,303 |
|
|
|
|
$ |
3,130,343 |
|
|
$ |
2,721,494 |
|
|
|
|
|
|
|
|
CONSOLIDATED STATEMENTS OF
INCOME |
|
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Twelve Months Ended |
|
Three Months Ended |
|
|
|
12/31/15 |
|
12/31/14 |
|
12/31/15 |
|
12/31/14 |
|
|
|
(dollars in thousands) |
|
Interest and dividend
income: |
|
|
|
|
|
|
|
|
|
Loans |
|
$ |
70,558 |
|
|
$ |
59,209 |
|
|
$ |
19,230 |
|
|
$ |
15,588 |
|
|
Investment securities: |
|
|
|
|
|
|
|
|
|
Taxable |
|
|
7,991 |
|
|
|
9,359 |
|
|
|
1,875 |
|
|
|
2,214 |
|
|
Nontaxable |
|
|
13,586 |
|
|
|
13,408 |
|
|
|
3,402 |
|
|
|
3,405 |
|
|
|
|
|
92,135 |
|
|
|
81,976 |
|
|
|
24,507 |
|
|
|
21,207 |
|
|
Interest
expense: |
|
|
|
|
|
|
|
|
|
Savings, NOW and money market
deposits |
|
|
2,564 |
|
|
|
1,955 |
|
|
|
724 |
|
|
|
523 |
|
|
Time deposits |
|
|
5,987 |
|
|
|
6,171 |
|
|
|
1,422 |
|
|
|
1,632 |
|
|
Short-term borrowings |
|
|
183 |
|
|
|
148 |
|
|
|
70 |
|
|
|
24 |
|
|
Long-term debt |
|
|
7,795 |
|
|
|
6,774 |
|
|
|
1,918 |
|
|
|
1,785 |
|
|
|
|
|
16,529 |
|
|
|
15,048 |
|
|
|
4,134 |
|
|
|
3,964 |
|
|
Net interest income |
|
|
75,606 |
|
|
|
66,928 |
|
|
|
20,373 |
|
|
|
17,243 |
|
|
Provision for loan
losses |
|
|
4,317 |
|
|
|
3,189 |
|
|
|
1,915 |
|
|
|
1,045 |
|
|
Net
interest income after provision for loan losses |
|
|
71,289 |
|
|
|
63,739 |
|
|
|
18,458 |
|
|
|
16,198 |
|
|
|
|
|
|
|
|
|
|
|
|
Noninterest
income: |
|
|
|
|
|
|
|
|
|
Investment Management Division
income |
|
|
2,044 |
|
|
|
2,058 |
|
|
|
496 |
|
|
|
501 |
|
|
Service charges on deposit
accounts |
|
|
2,577 |
|
|
|
2,974 |
|
|
|
596 |
|
|
|
671 |
|
|
Net gains on sales of
securities |
|
|
1,324 |
|
|
|
141 |
|
|
|
191 |
|
|
|
- |
|
|
Other |
|
|
2,813 |
|
|
|
2,228 |
|
|
|
617 |
|
|
|
557 |
|
|
|
|
|
8,758 |
|
|
|
7,401 |
|
|
|
1,900 |
|
|
|
1,729 |
|
|
Noninterest
expense: |
|
|
|
|
|
|
|
|
|
Salaries |
|
|
20,680 |
|
|
|
18,885 |
|
|
|
5,546 |
|
|
|
5,403 |
|
|
Employee benefits |
|
|
6,021 |
|
|
|
4,833 |
|
|
|
1,674 |
|
|
|
1,279 |
|
|
Occupancy and equipment |
|
|
8,798 |
|
|
|
8,880 |
|
|
|
2,159 |
|
|
|
2,433 |
|
|
Debt extinguishment |
|
|
1,084 |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
Other |
|
|
10,108 |
|
|
|
9,433 |
|
|
|
2,741 |
|
|
|
2,484 |
|
|
|
|
|
46,691 |
|
|
|
42,031 |
|
|
|
12,120 |
|
|
|
11,599 |
|
|
|
|
|
|
|
|
|
|
|
|
Income before income taxes |
|
|
33,356 |
|
|
|
29,109 |
|
|
|
8,238 |
|
|
|
6,328 |
|
|
Income tax expense |
|
|
7,466 |
|
|
|
6,095 |
|
|
|
1,620 |
|
|
|
869 |
|
|
Net Income |
|
$ |
25,890 |
|
|
$ |
23,014 |
|
|
$ |
6,618 |
|
|
$ |
5,459 |
|
|
|
|
|
|
|
|
|
|
|
|
Share and Per Share
Data: |
|
|
|
|
|
|
|
|
|
Weighted
Average Common & |
|
|
|
|
|
|
|
|
|
Common Equivalent Shares |
|
|
14,174,840 |
|
|
|
13,954,587 |
|
|
|
14,278,302 |
|
|
|
14,019,735 |
|
|
Basic
EPS |
|
$ |
1.85 |
|
|
$ |
1.67 |
|
|
$ |
.47 |
|
|
$ |
.39 |
|
|
Diluted
EPS |
|
$ |
1.83 |
|
|
$ |
1.65 |
|
|
$ |
.46 |
|
|
$ |
.39 |
|
|
Cash
Dividends Declared |
|
$ |
.78 |
|
|
$ |
.72 |
|
|
$ |
.20 |
|
|
$ |
.19 |
|
|
|
|
|
|
|
|
|
|
|
|
FINANCIAL RATIOS |
|
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
ROA |
|
|
.89 |
% |
|
|
.92 |
% |
|
|
.86 |
% |
|
|
.82 |
% |
|
ROE |
|
|
10.64 |
% |
|
|
10.25 |
% |
|
|
10.22 |
% |
|
|
9.27 |
% |
|
Net
Interest Margin |
|
|
2.94 |
% |
|
|
3.03 |
% |
|
|
2.98 |
% |
|
|
2.97 |
% |
|
Dividend
Payout Ratio |
|
|
42.62 |
% |
|
|
43.64 |
% |
|
|
43.48 |
% |
|
|
48.72 |
% |
|
|
|
|
|
|
|
|
|
|
|
PROBLEM AND POTENTIAL
PROBLEM LOANS AND ASSETS |
|
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
12/31/15 |
|
12/31/14 |
|
|
|
|
(in thousands) |
|
|
|
|
|
|
|
|
|
Loans, excluding
troubled debt restructurings: |
|
|
|
|
|
|
Past due 30 through 89
days |
|
$ |
1,003 |
|
|
$ |
2,186 |
|
|
|
Past due 90 days or more and still
accruing |
|
|
- |
|
|
|
- |
|
|
|
Nonaccrual (includes $105,000 in
loans held-for-sale at 12/31/15) |
|
|
535 |
|
|
|
424 |
|
|
|
|
|
|
1,538 |
|
|
|
2,610 |
|
|
|
Troubled debt
restructurings: |
|
|
|
|
|
|
Performing according to their
modified terms |
|
|
3,581 |
|
|
|
704 |
|
|
|
Past due 30 through 89
days |
|
|
- |
|
|
|
- |
|
|
|
Past due 90 days or more and still
accruing |
|
|
- |
|
|
|
- |
|
|
|
Nonaccrual |
|
|
900 |
|
|
|
1,280 |
|
|
|
|
|
|
4,481 |
|
|
|
1,984 |
|
|
|
Total past due,
nonaccrual and restructured loans: |
|
|
|
|
|
|
Restructured and performing
according to their modified terms |
|
|
3,581 |
|
|
|
704 |
|
|
|
Past due 30 through 89
days |
|
|
1,003 |
|
|
|
2,186 |
|
|
|
Past due 90 days or more and still
accruing |
|
|
- |
|
|
|
- |
|
|
|
Nonaccrual |
|
|
1,435 |
|
|
|
1,704 |
|
|
|
|
|
|
6,019 |
|
|
|
4,594 |
|
|
|
Other real estate
owned |
|
|
- |
|
|
|
- |
|
|
|
|
|
$ |
6,019 |
|
|
$ |
4,594 |
|
|
|
|
|
|
|
|
|
|
Allowance for loan
losses |
|
$ |
27,256 |
|
|
$ |
23,221 |
|
|
|
Allowance for loan
losses as a percentage of total loans |
|
|
1.21 |
% |
|
|
1.29 |
% |
|
|
Allowance for loan
losses as a multiple of nonaccrual loans |
|
|
19.0 |
x |
|
|
13.6 |
x |
|
|
|
|
|
|
|
|
|
AVERAGE BALANCE SHEET, INTEREST RATES AND
INTEREST DIFFERENTIAL |
|
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Twelve Months Ended December 31, |
|
|
|
2015 |
|
2014 |
|
|
|
Average |
|
Interest/ |
|
Average |
|
Average |
|
Interest/ |
|
Average |
|
|
|
Balance |
|
Dividends |
|
Rate |
|
Balance |
|
Dividends |
|
Rate |
|
Assets: |
|
(in thousands) |
|
Interest-bearing bank balances |
|
$ |
20,568 |
|
|
$ |
52 |
|
|
.25 |
% |
|
$ |
16,675 |
|
|
$ |
36 |
|
|
.22 |
% |
|
Investment securities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Taxable |
|
|
355,177 |
|
|
|
7,939 |
|
|
2.24 |
|
|
|
423,929 |
|
|
|
9,323 |
|
|
2.20 |
|
|
Nontaxable (1) |
|
|
438,835 |
|
|
|
20,585 |
|
|
4.69 |
|
|
|
414,972 |
|
|
|
20,315 |
|
|
4.90 |
|
|
Loans
(1) |
|
|
1,990,823 |
|
|
|
70,572 |
|
|
3.54 |
|
|
|
1,584,198 |
|
|
|
59,224 |
|
|
3.74 |
|
|
Total
interest-earning assets |
|
|
2,805,403 |
|
|
|
99,148 |
|
|
3.53 |
|
|
|
2,439,774 |
|
|
|
88,898 |
|
|
3.64 |
|
|
Allowance for loan losses |
|
|
(24,531 |
) |
|
|
|
|
|
|
|
(21,554 |
) |
|
|
|
|
|
|
Net
interest-earning assets |
|
|
2,780,872 |
|
|
|
|
|
|
|
|
2,418,220 |
|
|
|
|
|
|
|
Cash and
due from banks |
|
|
28,665 |
|
|
|
|
|
|
|
|
26,608 |
|
|
|
|
|
|
|
Premises
and equipment, net |
|
|
29,011 |
|
|
|
|
|
|
|
|
26,429 |
|
|
|
|
|
|
|
Other
assets |
|
|
59,000 |
|
|
|
|
|
|
|
|
43,846 |
|
|
|
|
|
|
|
|
|
$ |
2,897,548 |
|
|
|
|
|
|
|
$ |
2,515,103 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities and Stockholders' Equity: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Savings, NOW & money market deposits |
$ |
1,159,573 |
|
|
|
2,564 |
|
|
.22 |
|
|
$ |
972,136 |
|
|
|
1,955 |
|
|
.20 |
|
|
Time
deposits |
|
|
320,626 |
|
|
|
5,987 |
|
|
1.87 |
|
|
|
313,318 |
|
|
|
6,171 |
|
|
1.97 |
|
|
Total
interest-bearing deposits |
|
|
1,480,199 |
|
|
|
8,551 |
|
|
.58 |
|
|
|
1,285,454 |
|
|
|
8,126 |
|
|
.63 |
|
|
Short-term borrowings |
|
|
55,134 |
|
|
|
183 |
|
|
.33 |
|
|
|
48,220 |
|
|
|
148 |
|
|
.31 |
|
|
Long-term debt |
|
|
364,238 |
|
|
|
7,795 |
|
|
2.14 |
|
|
|
299,726 |
|
|
|
6,774 |
|
|
2.26 |
|
|
Total
interest-bearing liabilities |
|
|
1,899,571 |
|
|
|
16,529 |
|
|
.87 |
|
|
|
1,633,400 |
|
|
|
15,048 |
|
|
.92 |
|
|
Checking
deposits |
|
|
735,684 |
|
|
|
|
|
|
|
|
636,718 |
|
|
|
|
|
|
|
Other
liabilities |
|
|
18,963 |
|
|
|
|
|
|
|
|
20,400 |
|
|
|
|
|
|
|
|
|
|
2,654,218 |
|
|
|
|
|
|
|
|
2,290,518 |
|
|
|
|
|
|
|
Stockholders' equity |
|
|
243,330 |
|
|
|
|
|
|
|
|
224,585 |
|
|
|
|
|
|
|
|
|
$ |
2,897,548 |
|
|
|
|
|
|
|
$ |
2,515,103 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
interest income (1) |
|
|
|
$ |
82,619 |
|
|
|
|
|
|
|
$ |
73,850 |
|
|
|
|
|
Net
interest spread (1) |
|
|
|
|
|
2.66 |
% |
|
|
|
|
|
2.72 |
% |
|
Net
interest margin (1) |
|
|
|
|
|
2.94 |
% |
|
|
|
|
|
3.03 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Tax-equivalent basis. Interest income on a
tax-equivalent basis includes the additional amount of interest
income that would have been earned if the Corporation's investment
in tax-exempt loans and investment securities had been made in
loans and investment securities subject to Federal income taxes
yielding the same after-tax income. The tax-equivalent amount of
$1.00 of nontaxable income was $1.52 in each period presented,
based on a Federal income tax rate of 34%.
Forward Looking Information
This earnings release contains various
“forward-looking statements” within the meaning of that term as set
forth in Rule 175 of the Securities Act of 1933 and Rule 3b-6 of
the Securities Exchange Act of 1934. Such statements are generally
contained in sentences including the words “may” or “expect” or
“could” or “should” or “would” or “believe”. The Corporation
cautions that these forward-looking statements are subject to
numerous assumptions, risks and uncertainties that could cause
actual results to differ materially from those contemplated by the
forward-looking statements. Factors that could cause future results
to vary from current management expectations include, but are not
limited to, changing economic conditions; legislative and
regulatory changes; monetary and fiscal policies of the federal
government; changes in interest rates; deposit flows and the cost
of funds; demands for loan products; competition; changes in
management’s business strategies; changes in accounting principles,
policies or guidelines; changes in real estate values; and other
factors discussed in the “risk factors” section of the
Corporation’s filings with the Securities and Exchange Commission.
The forward-looking statements are made as of the date of this
report, and the Corporation assumes no obligation to update the
forward-looking statements or to update the reasons why actual
results could differ from those projected in the forward-looking
statements.
For more detailed financial information please
see the Corporation’s annual report on Form 10-K for the year ended
December 31, 2015. The Form 10-K will be available through the
Bank’s website at www.fnbli.com on or about March 15, 2016,
after it is electronically filed with the Securities and Exchange
Commission (“SEC”). Our SEC filings are also available on the SEC’s
website at www.sec.gov. You may also read and copy any document we
file with the SEC at the SEC’s public reference room at 100 F
Street, N.E., Room 1580, Washington, DC 20549. You should call
1-800-SEC-0330 for more information on the public reference
room.
For More Information Contact:
Mark D. Curtis, EVP, CFO and Treasurer
(516) 671-4900, Ext. 585
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