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Net income for the nine months ended September 30, 2009 was $3.9 million compared to $29.0 million for the same period in 2008. Net loss applicable to common shareholders for the nine months ended September 30, 2009 was $5.4 million, or $0.07 per diluted common share which included total preferred dividends of $9.3 million, or $0.12 per diluted common share compared to net income of $29.0 million or $0.39 per diluted common share for the same period in 2008.
"Our third quarter results were disappointing as the current economic environment led to an increased provision for loan losses and elevated charge-offs," commented J. Downey Bridgwater, Sterling's Chairman, President, and Chief Executive Officer. "During the third quarter of 2009, we charged off nonperforming loan amounts totaling $15.9 million against the related specific reserves. Additionally, the elevated charge-offs and our views about economic uncertainties have led to an increased provision for credit losses."
Average deposits increased $79.0 million to $4.0 billion at September 30, 2009, up 2.0% on a linked-quarter basis and up $397 million or 10.9% compared to September 30, 2008. This deposit growth has further strengthened the Company's balance sheet by improving the average loan to deposit ratio to 85.9% for the third quarter of 2009 down from 102% for the same quarter in 2008.
Average total loans decreased $168 million or 4.6% on a linked-quarter basis to $3.5 billion at September 30, 2009 and decreased $239 million since September 30, 2008. The decline in loan growth during the third quarter was primarily due to principal reductions in energy and construction and development loans.
At September 30, 2009, nonperforming assets were $119 million or 2.44% of total assets compared to $123 million or 2.50% at June 30, 2009. The decrease in nonperforming loans was primarily due to net charge-offs of $23.8 million recorded in the third quarter of 2009.
At September 30, 2009, the total allowance for credit losses was $57.9 million or 1.72% of period-end total loans, up from $54.2 million or 1.53% of period-end total loans linked-quarter. The allowance for credit losses has two components, a component based upon probable but unidentified losses inherent in the loan portfolio and a component based upon individual review of nonperforming or impaired loans. During the third quarter of 2009, management charged-off $15.9 million of nonperforming loans against the related specific reserves. These loans were considered collateral dependent and as such have been written-down to the underlying collateral value with no remaining associated allowance.
Net charge-offs for the third quarter of 2009 were $23.8 million or 2.71% of average total loans, compared to $15.1 million or 1.67% of average total loans, for the second quarter of 2009. Net charge-offs for the nine month period ended September 30, 2009 were $40.9 million or 1.51% of average total loans, up from $10.9 million or 0.40%, for the same period in 2008. The primary increase in net charge-offs during 2009 was due to the $15.9 million of charge-offs related to collateral-based nonperforming loans and a $9.6 million charge-off related to Semgroup (a previously disclosed nonperforming energy loan relationship) which had previously been provided for in our allowance for loan losses.
Tax-equivalent net interest income for the third quarter of 2009 was $48.3 million, down $710 thousand linked-quarter. Tax-equivalent net interest margin was 4.20% for the third quarter of 2009, down 13 basis points from 4.33% for the second quarter of 2009.
Noninterest income for the third quarter of 2009 decreased $1.4 million on a linked-quarter basis and decreased $688 thousand compared to the same period in 2008. This decrease was due to the hedge ineffectiveness recorded in noninterest income during the second quarter of 2009.
Total noninterest expense decreased $3.9 million for the third quarter of 2009 as compared with the second quarter of 2009 and increased $1.1 million compared to the same period in 2008. Salaries and benefits decreased $3.1 million on a linked-quarter basis and $687 thousand compared to the third quarter in 2008, as a result of our expense reduction initiative during 2009. FDIC insurance premiums decreased $2.3 million for the third quarter of 2009 compared to the second quarter of 2009 and increased $1.2 million compared to the third quarter of 2008. The Company recorded a special FDIC assessment of $2.3 million during the second quarter of 2009.
As of September 30, 2009, Sterling had total assets of $4.9 billion, total loans of $3.4 billion and total deposits of $4.0 billion. Shareholders' equity of $564 million at September 30, 2009 was 11.57% of total assets. Book value per common share at period-end was $6.90.
Conference Call
Management of Sterling will host a conference call for investors and analysts that will be broadcast live via telephone and over the Internet on Thursday, October 22, 2009 at 11:00 a.m. Eastern Time. To participate, visit the Investor Relations section of the Company's web site at http://www.banksterling.com or call (480) 293-0631. An audio archive of the call will also be available on the web site beginning Friday, October 23, 2009.
A telephone replay of the conference call will be available beginning Thursday, October 22, 2009 at 12:00 p.m. until Thursday, October 29, 2009 at 11:59 p.m. Central Time by dialing (800) 475-6701. The access code for the replay is 118311.
Forward-Looking Statements
This news release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve risks and uncertainties and are based on beliefs and assumptions of management at the time that this release was prepared. The Company does not assume any obligation to update the forward-looking statements. There are several factors, many beyond the Company's control, that could cause results to differ significantly from expectations including: adverse changes in the loan portfolio and the resulting credit risk-related losses and expenses; potential inadequacy of the allowance for credit losses; the ability to maintain or improve origination volumes; competitive influences on product pricing; the ability to integrate acquisitions and realize expected cost savings and revenue enhancements, effects of changes in interest rates on net interest margin and changes in federal and state regulations and laws. Additional factors can be found in the Company's 2008 Annual Report on Form 10-K filed with the Securities and Exchange Commission and available at the Securities and Exchange Commission's web site (www.sec.gov).
About Sterling Bancshares
Sterling Bancshares, Inc. is a Houston-based bank holding company with total assets of $4.9 billion, which operates 60 banking centers in the greater metropolitan areas of Houston, San Antonio, Dallas and Fort Worth, Texas. The Company's common stock is traded through the NASDAQ Global Select Market under the symbol "SBIB". For more information on Sterling Bancshares, please visit the Company's web site at http://www.banksterling.com.
For More Information Contact:
J. Downey Bridgwater, Chairman, President
and Chief Executive Officer, (713) 507-2670
Zach L. Wasson, Executive Vice President
and Chief Financial Officer, (713) 507-1297
-Tables to follow-
STERLING BANCSHARES, INC.
SELECTED FINANCIAL INFORMATION (Unaudited)
(dollars in thousands, except for per share data)
Quarter Ended Year-to-date
------------- ------------
Sep. 30, Jun. 30, Sep. 30,
2009 2009 2008 2009 2008
---- ---- ---- ---- ----
Profitability
Net income (loss) $(6,113) $2,607 $7,090 $3,901 $29,006
Net income (loss)
applicable to common
shareholders $(6,113) $(4,851) $7,090 $(5,441) $29,006
Earnings (loss) per common
share (1):
Basic $(0.07) $(0.06) $0.10 $(0.07) $0.40
Diluted $(0.07) $(0.06) $0.10 $(0.07) $0.39
Return on average common
equity (2) (4.20)% (3.46)% 5.61% (1.31)% 7.75%
Return on average assets
(2) (0.49)% 0.21% 0.57% 0.10% 0.81%
Tax equivalent net
interest margin (3) 4.20% 4.33% 4.44% 4.26% 4.59%
Efficiency Ratio (4):
Consolidated 69.56% 70.54% 64.08% 68.73% 62.57%
Sterling Bank 67.79% 68.37% 62.14% 66.76% 60.59%
Liquidity and Capital Ratios
Average loans to average
deposits 85.87% 91.81% 101.77% 91.82% 100.19%
Period-end stockholders'
equity to total assets 11.57% 11.61% 10.14% 11.57% 10.14%
Average stockholders'
equity to average assets 11.61% 12.14% 10.20% 12.18% 10.44%
Period-end tangible capital
to total tangible assets 8.07% 8.13% 6.60% 8.07% 6.60%
Tier 1 capital to risk-
weighted assets 11.63% 11.08% 9.18% 11.63% 9.18%
Total capital to risk-
weighted assets 14.37% 13.72% 11.82% 14.37% 11.82%
Tier 1 leverage ratio
(Tier 1 capital to
average assets) 9.26% 9.38% 8.15% 9.62% 8.15%
Other Data
Shares used in computing
earnings per common share
Basic shares 81,707 77,894 73,186 77,659 73,158
Diluted shares 81,707 77,894 73,525 77,659 73,475
End of period common
shares outstanding 81,755 81,685 73,219 81,755 73,219
Book value per common
share at period-end $6.90 $6.98 $6.85 $6.90 $6.85
Cash dividends paid per
common share $0.055 $0.055 $0.055 $0.165 $0.165
Common stock dividend
payout ratio (73.58)% 154.89% 56.83% 322.26% 41.65%
Full-time equivalent
employees 1,013 1,038 1,119 1,013 1,119
Number of banking centers 60 61 59 60 59
STERLING BANCSHARES, INC.
CONSOLIDATED BALANCE SHEETS (Unaudited)
(dollars in thousands)
Sep. 30, Jun. 30, Mar. 31, Dec. 31, Sep. 30,
2009 2009 2009 2008 2008
---- ---- ---- ---- ----
ASSETS
Cash and cash
equivalents $158,114 $74,736 $142,769 $113,163 $113,070
Available-for-
sale securities,
at fair value 836,521 766,536 673,960 633,357 543,545
Held-to-maturity
securities,
at amortized
cost 162,990 163,611 169,973 172,039 174,434
Loans held for
Sale 1,336 1,642 1,395 1,524 322
Loans held for
investment 3,363,003 3,537,221 3,727,368 3,792,290 3,744,772
--------- --------- --------- --------- ---------
Total loans 3,364,339 3,538,863 3,728,763 3,793,814 3,745,094
Allowance for
loan losses (56,058) (53,075) (56,703) (49,177) (45,222)
------- ------- ------- ------- -------
Loans, net 3,308,281 3,485,788 3,672,060 3,744,637 3,699,872
Premises and
equipment, net 49,128 50,272 50,738 46,875 41,195
Real estate
acquired by
foreclosure 11,674 8,095 8,144 5,625 4,562
Goodwill 173,210 173,210 173,210 173,210 173,210
Core deposits
and other
intangibles,
net 12,179 12,744 13,309 13,874 14,444
Accrued interest
receivable 16,142 18,189 18,285 19,428 17,968
Other assets 148,890 159,186 152,383 157,771 164,929
------- ------- ------- ------- -------
TOTAL ASSETS $4,877,129 $4,912,367 $5,074,831 $5,079,979 $4,947,229
========== ========== ========== ========== ==========
LIABILITIES AND SHAREHOLDERS' EQUITY
LIABILITIES:
Deposits:
Noninterest-
bearing
demand $1,094,346 $1,127,717 $1,173,745 $1,123,746 $1,085,882
Interest-
bearing
demand 1,874,746 1,670,437 1,586,754 1,523,969 1,397,614
Certificates
and other
time 1,038,362 1,160,081 1,173,958 1,171,422 1,090,624
--------- --------- --------- --------- ---------
Total
deposits 4,007,454 3,958,235 3,934,457 3,819,137 3,574,120
Other borrowed
funds 99,486 176,631 278,274 408,586 668,069
Subordinated
debt 77,616 77,028 78,310 78,335 74,266
Junior
subordinated
debt 82,734 82,734 82,734 82,734 82,734
Accrued interest
payable and other
liabilities 45,715 47,631 53,942 48,048 46,145
------ ------ ------ ------ ------
Total
liabilities 4,313,005 4,342,259 4,427,717 4,436,840 4,445,334
COMMITMENTS AND
CONTINGENCIES - - - - -
SHAREHOLDERS'
EQUITY
Preferred stock - - 118,332 118,012 -
Common stock 83,622 83,552 75,168 75,128 75,086
Capital surplus 171,955 170,708 122,877 121,918 113,611
Retained earnings 314,013 324,619 333,498 332,009 326,826
Treasury stock (21,399) (21,399) (21,399) (21,399) (21,399)
Accumulated other
comprehensive
income, net of
tax 15,933 12,628 18,638 17,471 7,771
------ ------ ------ ------ -----
Total
shareholders'
equity 564,124 570,108 647,114 643,139 501,895
------- ------- ------- ------- -------
TOTAL
LIABILITIES
AND
SHAREHOLDERS'
EQUITY $4,877,129 $4,912,367 $5,074,831 $5,079,979 $4,947,229
========== ========== ========== ========== ==========
STERLING BANCSHARES, INC.
CONSOLIDATED STATEMENTS OF INCOME (Unaudited)
(dollars in thousands, except for per share data)
Quarter Ended
--------------
Sep. 30, Jun. 30, Mar. 31, Dec. 31, Sep. 30,
2009 2009 2009 2008 2008
---- ---- ---- ---- ----
Interest income:
Loans, including fees $49,658 $51,691 $53,000 $58,387 $59,636
Securities:
Taxable 9,286 8,815 8,558 7,989 7,714
Non-taxable 897 890 900 907 909
Deposits in financial
institutions 64 - - - 2
Other interest-
earning assets 29 26 6 3 53
--- --- --- --- ---
Total interest
income 59,934 61,422 62,464 67,286 68,314
------ ------ ------ ------ ------
Interest expense:
Demand and savings
deposits 4,403 3,886 3,492 3,645 4,136
Certificates and
other time deposits 5,504 6,503 7,467 8,041 8,763
Other borrowed funds 346 425 812 2,414 3,432
Subordinated debt 748 885 979 1,380 1,198
Junior subordinated
debt 1,082 1,155 1,204 1,430 1,317
----- ----- ----- ----- -----
Total interest
expense 12,083 12,854 13,954 16,910 18,846
------ ------ ------ ------ ------
Net interest income 47,851 48,568 48,510 50,376 49,468
Provision for credit
losses 27,500 11,500 9,000 7,500 10,100
------ ------ ----- ----- ------
Net interest income
after
provision for credit
losses 20,351 37,068 39,510 42,876 39,368
------ ------ ------ ------ ------
Noninterest income:
Customer service fees 3,845 3,752 4,112 3,865 3,882
Net gain (loss) on
securities 4 (2) 15 (57) (187)
Wealth management
fees 1,862 1,840 2,202 2,028 2,255
Other 3,402 4,903 4,469 3,805 3,851
----- ----- ----- ----- -----
Total noninterest
income 9,113 10,493 10,798 9,641 9,801
----- ------ ------ ----- -----
Noninterest expense:
Salaries and employee
benefits 21,005 24,152 22,277 21,937 21,692
Occupancy 5,967 6,168 5,869 5,790 5,367
Technology 2,495 2,475 2,505 2,559 2,600
Professional fees 1,065 1,157 1,197 1,226 1,257
Postage, delivery and
supplies 700 760 721 765 871
Marketing 557 499 431 781 627
Core deposits and
other intangibles
amortization 565 565 565 571 586
Acquisition costs 154 - - - -
FDIC insurance
assessments 1,741 4,001 1,232 762 561
Other 5,826 4,244 4,801 4,726 5,436
----- ----- ----- ----- -----
Total noninterest
expense 40,075 44,021 39,598 39,117 38,997
------ ------ ------ ------ ------
Income before income
taxes (10,611) 3,540 10,710 13,400 10,172
Provision for income
taxes (4,498) 933 3,303 3,787 3,082
------ --- ----- ----- -----
Net income (loss) $(6,113) $2,607 $7,407 $9,613 $7,090
======= ====== ====== ====== ======
Preferred stock
dividends - 7,458 1,884 398 -
--- ----- ----- --- ---
Net income (loss)
applicable to common
shareholders $(6,113) $(4,851) $5,523 $9,215 $7,090
======= ======= ====== ====== ======
Earnings (loss) per common
share (1):
Basic $(0.07) $(0.06) $0.08 $0.13 $0.10
====== ====== ===== ===== =====
Diluted $(0.07) $(0.06) $0.08 $0.13 $0.10
====== ====== ===== ===== =====
Year-to-date
------------
2009 2008
---- ----
Interest income:
Loans, including fees $154,349 $182,770
Securities:
Taxable 26,659 21,671
Non-taxable 2,687 2,725
Deposits in financial
institutions 64 10
Other interest-earning
assets 61 162
-- ---
Total interest
income 183,820 207,338
------- -------
Interest expense:
Demand and savings
deposits 11,781 13,640
Certificates and other
time deposits 19,474 29,402
Other borrowed funds 1,583 9,193
Subordinated debt 2,612 3,094
Junior subordinated
debt 3,441 4,301
----- -----
Total interest
expense 38,891 59,630
------ ------
Net interest income 144,929 147,708
Provision for credit
losses 48,000 22,417
------ ------
Net interest income
after provision for
credit losses 96,929 125,291
------ -------
Noninterest income:
Customer service fees 11,709 11,906
Net gain (loss) on
securities 17 (187)
Wealth management
fees 5,904 6,956
Other 12,774 12,711
------ ------
Total noninterest
income 30,404 31,386
------ ------
Noninterest expense:
Salaries and employee
benefits 67,434 63,316
Occupancy 18,004 15,992
Technology 7,475 7,235
Professional fees 3,419 3,481
Postage, delivery and
supplies 2,181 2,907
Marketing 1,487 1,764
Core deposits and other
intangibles
amortization 1,695 1,757
Acquisition costs 154 562
FDIC insurance
assessments 6,974 1,762
Other 14,871 15,317
------ ------
Total noninterest
expense 123,694 114,093
------- -------
Income before income
taxes 3,639 42,584
Provision for income
taxes (262) 13,578
---- ------
Net income (loss) $3,901 $29,006
====== =======
Preferred stock
dividends 9,342 -
----- ---
Net income (loss)
applicable to common
shareholders $(5,441) $29,006
======= =======
Earnings (loss) per
common share (1):
Basic $(0.07) $0.40
====== =====
Diluted $(0.07) $0.39
====== =====
STERLING BANCSHARES, INC.
SELECTED FINANCIAL INFORMATION (Unaudited)
(dollars in thousands)
Quarter Ended
-------------
Sep. 30,
2009
----
Average Balance Interest Yield/Rate
--------------- -------- ----------
Interest-Earning Assets:
Loans held for sale $1,206 $23 7.61%
Loans held for investment:
Taxable 3,468,104 49,586 5.67%
Non-taxable (3) 5,080 72 5.60%
Securities:
Taxable 844,651 9,286 4.36%
Non-taxable (3) 97,858 1,307 5.30%
Deposits in financial institutions 106,392 64 0.24%
Other interest-earning assets 38,419 29 0.30%
------ -- ----
Total interest-earning assets 4,561,710 60,367 5.25%
Noninterest-earning assets 416,384
-------
Total Assets $4,978,094
==========
Interest-Bearing Liabilities:
Deposits:
Demand and savings $1,837,612 $4,403 0.95%
Certificates and other time 1,084,513 5,504 2.01%
Other borrowed funds 145,625 346 0.94%
Subordinated debt 77,232 748 3.84%
Junior subordinated debt 82,734 1,082 5.19%
------ ----- ----
Total interest-bearing
liabilities 3,227,716 12,083 1.49%
Noninterest-bearing sources:
Noninterest-bearing liabilities 1,172,545
Shareholders' equity 577,833
-------
Total Liabilities and Shareholders'
Equity $4,978,094
========== ------ ----
Tax Equivalent Net Interest Income
and Margin (3) 48,284 4.20%
====
Tax Equivalent Adjustment:
Loans 23
Securities 410
---
Total tax equivalent adjustment 433
---
Net Interest Income $47,851
=======
Quarter Ended
-------------
Jun. 30,
2009
----
Average Balance Interest Yield/Rate
--------------- -------- ----------
Interest-Earning Assets:
Loans held for sale $2,714 $40 5.84%
Loans held for investment:
Taxable 3,634,159 51,598 5.69%
Non-taxable (3) 5,294 77 5.87%
Securities:
Taxable 761,249 8,815 4.64%
Non-taxable (3) 96,447 1,292 5.37%
Deposits in financial institutions 281 - 0.00%
Other interest-earning assets 39,534 26 0.26%
------ -- ----
Total interest-earning assets 4,539,678 61,848 5.46%
Noninterest-earning assets 451,642
-------
Total Assets $4,991,320
==========
Interest-Bearing Liabilities:
Deposits:
Demand and savings $1,674,468 $3,886 0.93%
Certificates and other time 1,175,434 6,503 2.22%
Other borrowed funds 216,342 425 0.79%
Subordinated debt 77,701 885 4.57%
Junior subordinated debt 82,734 1,155 5.60%
------ ----- ----
Total interest-bearing
liabilities 3,226,679 12,854 1.60%
Noninterest-bearing sources:
Noninterest-bearing liabilities 1,158,883
Shareholders' equity 605,758
-------
Total Liabilities and Shareholders'
Equity $4,991,320
========== ------ ----
Tax Equivalent Net Interest Income
and Margin (3) 48,994 4.33%
====
Tax Equivalent Adjustment:
Loans 24
Securities 402
---
Total tax equivalent adjustment 426
---
Net Interest Income $48,568
=======
STERLING BANCSHARES, INC.
SELECTED FINANCIAL INFORMATION (Unaudited)
(dollars in thousands)
Year-to-date
------------
2009
----
Average Balance Interest Yield/Rate
--------------- -------- ----------
Interest-Earning Assets:
Loans held for sale $1,929 $89 6.15%
Loans held for investment:
Taxable 3,624,663 154,098 5.68%
Non-taxable (3) 5,141 237 6.16%
Securities:
Taxable 772,386 26,659 4.61%
Non-taxable (3) 97,069 3,902 5.37%
Deposits in financial institutions 60,885 64 0.14%
Other interest-earning assets 29,336 61 0.28%
------ -- ----
Total interest-earning assets 4,591,409 185,110 5.39%
Noninterest-earning assets 422,032
-------
Total Assets $5,013,441
==========
Interest-Bearing Liabilities:
Deposits:
Demand and savings $1,693,613 $11,781 0.93%
Certificates and other time 1,137,866 19,474 2.29%
Other borrowed funds 241,653 1,583 0.88%
Subordinated debt 77,582 2,612 4.50%
Junior subordinated debt 82,734 3,441 5.56%
------ ----- ----
Total interest-bearing
liabilities 3,233,448 38,891 1.61%
Noninterest-bearing sources:
Noninterest-bearing liabilities 1,169,107
Shareholders' equity 610,886
-------
Total Liabilities and Shareholders'
Equity $5,013,441
========== ------- ----
Tax Equivalent Net Interest Income
and Margin (3) 146,219 4.26%
====
Tax Equivalent Adjustment:
Loans 75
Securities 1,215
-----
Total tax equivalent adjustment 1,290
-----
Net Interest Income $144,929
========
Year-to-date
------------
2008
----
Average Balance Interest Yield/Rate
--------------- -------- ----------
Interest-Earning Assets:
Loans held for sale $94,677 $4,681 6.60%
Loans held for investment:
Taxable 3,514,320 177,950 6.76%
Non-taxable (3) 3,260 202 8.27%
Securities:
Taxable 610,877 21,671 4.74%
Non-taxable (3) 97,278 3,820 5.25%
Deposits in financial institutions 590 10 2.26%
Other interest-earning assets 10,168 162 2.13%
------ --- ----
Total interest-earning assets 4,331,170 208,496 6.43%
Noninterest-earning assets 460,904
-------
Total Assets $4,792,074
==========
Interest-Bearing Liabilities:
Deposits:
Demand and savings $1,419,654 $13,640 1.28%
Certificates and other time 1,109,199 29,402 3.54%
Other borrowed funds 500,268 9,193 2.45%
Subordinated debt 57,687 3,094 7.16%
Junior subordinated debt 82,734 4,301 6.94%
------ ----- ----
Total interest-bearing
liabilities 3,169,542 59,630 2.51%
Noninterest-bearing sources:
Noninterest-bearing liabilities 1,122,443
Shareholders' equity 500,089
-------
Total Liabilities and Shareholders'
Equity $4,792,074
========== ------- ----
Tax Equivalent Net Interest Income
and Margin (3) 148,866 4.59%
====
Tax Equivalent Adjustment:
Loans 63
Securities 1,095
-----
Total tax equivalent adjustment 1,158
-----
Net Interest Income $147,708
========
STERLING BANCSHARES, INC.
SELECTED FINANCIAL INFORMATION (Unaudited)
(dollars in thousands)
Quarter Ended
-------------
Sep. 30, Jun. 30, Mar. 31, Dec. 31, Sep. 30,
2009 2009 2009 2008 2008
---- ---- ---- ---- ----
Condensed Average
Balance Sheet
Loans held for sale $1,206 $2,714 $1,876 $684 $110,721
Loans held for
investment 3,473,184 3,639,453 3,780,147 3,795,340 3,602,853
--------- --------- --------- --------- ---------
Total loans 3,474,390 3,642,167 3,782,023 3,796,024 3,713,574
Available-for-
sale securities,
at fair value 779,792 689,541 635,423 573,073 564,779
Held-to-maturity
securities, at
amortized cost 162,717 168,155 171,245 173,584 174,980
Deposits in
financial
institutions 106,392 281 257 273 326
Other interest-
earning assets 38,419 39,534 9,740 4,093 11,122
------ ------ ----- ----- ------
Total interest-
earning
assets 4,561,710 4,539,678 4,598,688 4,547,047 4,464,781
Goodwill 173,210 173,210 173,210 173,210 173,106
Core deposits and
other intangibles,
net 12,463 13,028 13,587 14,158 14,740
All other
noninterest-
earning assets 230,711 265,404 286,454 301,516 281,156
------- ------- ------- ------- -------
Total assets $4,978,094 $4,991,320 $5,071,939 $5,035,931 $4,933,783
========== ========== ========== ========== ==========
Noninterest-
bearing demand
deposits $1,124,076 $1,117,335 $1,130,230 $1,116,607 $1,093,053
Interest bearing
deposits:
Interest-
bearing
demand
deposits 1,837,612 1,674,468 1,565,770 1,407,482 1,410,719
Jumbo
certificates
of deposit 614,418 658,983 651,798 634,499 677,251
Regular
certificates of
deposit 287,243 308,842 306,686 306,224 316,567
Brokered
certificates of
deposit 182,852 207,609 195,936 162,654 151,378
------- ------- ------- ------- -------
Total
deposits 4,046,201 3,967,237 3,850,420 3,627,466 3,648,968
Other borrowed
funds 145,625 216,342 365,408 667,933 581,212
Subordinated debt 77,232 77,701 77,820 75,354 74,098
Junior
subordinated debt 82,734 82,734 82,734 82,734 82,734
Accrued interest
payable and other
liabilities 48,469 41,548 45,698 44,340 43,608
------ ------ ------ ------ ------
Total
liabilities 4,400,261 4,385,562 4,422,080 4,497,827 4,430,620
Common equity 577,833 561,540 531,736 510,965 503,163
Preferred equity - 44,218 118,123 27,139 -
--- ------ ------- ------ ---
Total
shareholders'
equity 577,833 605,758 649,859 538,104 503,163
------- ------- ------- ------- -------
Total
liabilities
and
shareholders'
equity $4,978,094 $4,991,320 $5,071,939 $5,035,931 $4,933,783
========== ========== ========== ========== ==========
Sep. 30, Jun. 30, Mar. 31, Dec. 31, Sep. 30,
2009 2009 2009 2008 2008
---- ---- ---- ---- ----
Period-end Loans:
Loans held for sale $1,336 $1,642 $1,395 $1,524 $322
Loans held for
investment:
Commercial and
industrial 841,938 930,445 1,060,572 1,107,519 1,094,767
Real Estate:
Commercial 1,735,971 1,768,824 1,788,488 1,765,843 1,564,989
Construction
and
development 394,819 458,386 499,262 545,303 732,174
Residential
mortgage 335,007 323,520 320,021 309,665 284,036
Consumer/other 55,268 56,046 59,025 63,960 68,806
------ ------ ------ ------ ------
Loans held for
investment 3,363,003 3,537,221 3,727,368 3,792,290 3,744,772
--------- --------- --------- --------- ---------
Total period-end
loans $3,364,339 $3,538,863 $3,728,763 $3,793,814 $3,745,094
========== ========== ========== ========== ==========
Period-End Deposits:
Noninterest-
bearing demand $1,094,346 $1,127,717 $1,173,745 $1,123,746 $1,085,882
Interest-bearing
demand 1,874,746 1,670,437 1,586,754 1,523,969 1,397,614
Certificates and
other time
deposits:
Jumbo 594,590 644,965 666,722 660,427 636,447
Regular 273,721 306,988 301,047 317,719 304,050
Brokered 170,051 208,128 206,189 193,276 150,127
------- ------- ------- ------- -------
Total period-end
deposits $4,007,454 $3,958,235 $3,934,457 $3,819,137 $3,574,120
========== ========== ========== ========== ==========
STERLING BANCSHARES, INC.
SELECTED FINANCIAL INFORMATION (Unaudited)
(dollars in thousands)
Quarter Ended
Sep. 30, Jun. 30, Mar. 31, Dec. 31, Sep. 30,
2009 2009 2009 2008 2008
---- ---- ---- ---- ----
Allowance For Credit
Losses
Allowance for loan
losses at beginning
of period $53,075 $56,703 $49,177 $45,222 $41,651
Charge-offs:
Commercial,
financial and
industrial 1,803 13,523 1,960 1,764 3,713
Real estate,
mortgage and
construction 22,083 1,903 438 1,629 1,879
Consumer 318 331 460 648 657
--- --- --- --- ---
Total
charge-
offs 24,204 15,757 2,858 4,041 6,249
------ ------ ----- ----- -----
Recoveries:
Commercial,
financial and
industrial 251 286 640 286 277
Real estate,
mortgage and
construction 23 180 98 5 28
Consumer 163 163 94 205 142
--- --- -- --- ---
Total
recoveries 437 629 832 496 447
--- --- --- --- ---
Net charge-offs 23,767 15,128 2,026 3,545 5,802
Provision for
loan losses 26,750 11,500 9,552 7,500 9,373
------ ------ ----- ----- -----
Allowance for
loan losses at
end of period $56,058 $53,075 $56,703 $49,177 $45,222
------- ------- ------- ------- -------
Allowance for
unfunded loan
commitments
at beginning
of period 1,102 1,102 1,654 1,654 927
Provision for
losses on
unfunded loan
commitments 750 - (552) - 727
--- --- ---- --- ---
Allowance for
unfunded loan
commitments
at end of
period 1,852 1,102 1,102 1,654 1,654
----- ----- ----- ----- -----
Total
allowance for
credit losses $57,910 $54,177 $57,805 $50,831 $46,876
======= ======= ======= ======= =======
Nonperforming Assets
Nonaccrual loans $107,257 $114,069 $102,450 $87,491 $70,538
Real estate
acquired by
foreclosure 11,674 8,095 8,144 5,625 4,562
Other repossessed
assets 33 419 144 154 234
--- --- --- --- ---
Total nonperforming
assets $118,964 $122,583 $110,738 $93,270 $75,334
======== ======== ======== ======= =======
Restructured
loans - accruing $27,668 $2,828 $ - $ - $ -
======= ====== ======= ======= =======
Accruing loans 30 to
89 days past due $23,356 $30,131 $26,640 $30,492 $31,749
======= ======= ======= ======= =======
Accruing loans past
due 90 days or more $681 $2,112 $7,464 $8,448 $3,142
==== ====== ====== ====== ======
Ratios
Period-end allowance
for credit losses to
period-end loans 1.72% 1.53% 1.55% 1.34% 1.25%
Period-end allowance for
loan losses to
period-end loans 1.67% 1.50% 1.52% 1.30% 1.21%
Period-end allowance for
loan losses to
nonperforming loans 52.27% 46.53% 55.35% 56.21% 64.11%
Nonperforming loans
to period-end loans 3.19% 3.22% 2.75% 2.31% 1.88%
Nonperforming assets to
period-end assets 2.44% 2.50% 2.18% 1.84% 1.52%
Net charge-offs to
average loans (2) 2.71% 1.67% 0.22% 0.37% 0.62%
Year-to-date
------------
2009 2008
---- ----
Allowance For
Credit Losses
Allowance for
loan losses
at beginning
of period $49,177 $34,446
Charge-offs:
Commercial,
financial and
industrial 17,286 7,644
Real estate,
mortgage and
construction 24,424 3,612
Consumer 1,109 1,311
----- -----
Total
charge-
offs 42,819 12,567
------ ------
Recoveries:
Commercial,
financial and
industrial 1,177 1,106
Real estate,
mortgage and
construction 301 112
Consumer 420 435
--- ---
Total
recoveries 1,898 1,653
----- -----
Net charge-offs 40,921 10,914
Provision for
loan losses 47,802 21,690
------ ------
Allowance for
loan losses
at end of
period $56,058 $45,222
------- -------
Allowance for unfunded
loan commitments at
beginning of period 1,654 927
Provision for losses on
unfunded loan commitments 198 727
--- ---
Allowance for unfunded
loan commitments at end of
period 1,852 1,654
----- -----
Total allowance for credit
losses $57,910 $46,876
======= =======
Nonperforming Assets
Nonaccrual loans $107,257 $70,538
Real estate acquired by
foreclosure 11,674 4,562
Other repossessed
assets 33 234
--- ---
Total
nonperforming
assets $118,964 $75,334
======== =======
Restructured
loans - accruing $27,668 $ -
======= =======
Accruing loans 30 to
89 days past due $23,356 $31,749
======= =======
Accruing loans past
due 90 days or more $681 $3,142
==== ======
Ratios
Period-end allowance
for credit losses to
period-end loans 1.72% 1.25%
Period-end allowance
for loan losses to
period-end loans 1.67% 1.21%
Period-end allowance for
loan losses to nonperforming
loans 52.27% 64.11%
Nonperforming loans to
period-end loans 3.19% 1.88%
Nonperforming assets to
period-end assets 2.44% 1.52%
Net charge-offs to average
loans (2) 1.51% 0.40%
STERLING BANCSHARES, INC.
FOOTNOTES TO EARNINGS RELEASE
(1) Earnings per share in each quarter is computed individually using the
weighted-average number of shares outstanding during that quarter
while earnings per share for the full period is computed using the
weighted-average number of shares outstanding during the year. Thus,
the sum for all quarters does not necessarily equal the full period
earnings per share.
(2) Interim periods annualized.
(3) Taxable-equivalent basis assuming a 35% tax rate.
(4) The efficiency ratio is calculated by dividing noninterest expense
less acquisition costs, hurricane related costs and a one-time
severance charge by tax equivalent basis net interest income plus
noninterest income less net gain (loss) on investment securities.
SOURCE Sterling Bancshares, Inc.
http://www.banksterling.com/
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