EverBank Financial Corp (NYSE: EVER) announced today its financial results for the third quarter ended September 30, 2014.
"We are pleased with our third quarter performance as we delivered strong earnings, achieved robust portfolio loan growth and benefited from our deposit growth initiatives," said Robert M. Clements, chairman and chief executive officer. "We remain focused on executing our core strategies designed to enhance the long-term value of our franchise and serve the needs of our consumer and commercial banking clients."
GAAP net income available to common shareholders was $41.0 million for the third quarter 2014, compared to $32.3 million for the second quarter 2014 and $30.6 million for the third quarter 2013. GAAP diluted earnings per share were $0.33, a 27% increase from $0.26 in the second quarter 2014 and a 32% increase from $0.25 in the third quarter 2013.
Third Quarter 2014 Key Highlights
- Return on average equity (ROE) was 10.6% for the quarter.
- Portfolio loans held for investment (HFI) of $16.6 billion, an increase of 8% compared to the prior quarter.
- Retained originations of $1.7 billion in the quarter; year to date retained originations of $4.3 billion.
- Total assets of $20.5 billion, an increase of 4% compared to the prior quarter.
- Total deposits of $14.5 billion, an increase of 4% compared to the prior quarter.
- Tangible common equity per common share increased 8% year over year to $12.36 at September 30, 2014.
- Strong capital position with bank tier 1 leverage ratio of 8.5% and bank total risk-based capital ratio of 14.0%.
- Adjusted non-performing assets to total assets1 improved to 0.50% at September 30, 2014. Annualized net charge-offs to total loans and leases held for investment remained low at 0.09% for the quarter.
"During the quarter, we continued to execute on initiatives designed to deliver improved efficiency and drive operating leverage across the organization," said W. Blake Wilson, president and chief operating officer. "The investments we have made in our origination franchise are resulting in continued portfolio loan growth across our consumer and commercial businesses."
Balance Sheet
Strong Asset Growth
Total assets were $20.5 billion at September 30, 2014, an increase of $757 million, or 4%, compared to the prior quarter and an increase of $2.9 billion, or 16%, year over year. The strong sequential increase was driven by a $1.3 billion, or 8%, increase in portfolio loans HFI to $16.6 billion, resulting from both consumer and commercial loan growth, offset by an $833 million, or 49%, decrease in portfolio loans held for sale (HFS). The decrease in loans HFS resulted from the sale of fixed-rate and longer duration preferred jumbo loans during the quarter as investor demand for EverBank originated loans remained strong.
1 | A reconciliation of Non-GAAP financial measures can be found in the financial tables attached hereto. |
Loans HFI for the third quarter of 2014, as compared to the second quarter of 2014 and third quarter of 2013, were comprised of:
($ in millions) | Sep 30, 2014 | Jun 30, 2014 | Sep 30, 2013 | % | % | ||||||||||||||||||||
Consumer Banking: | |||||||||||||||||||||||||
Residential loans | $ | 6,007 | $ | 5,205 | $ | 4,623 | 15 | % | 30 | % | |||||||||||||||
Government insured pool buyouts | 3,395 | 3,197 | 2,075 | 6 | % | 64 | % | ||||||||||||||||||
Total residential mortgages | 9,402 | 8,402 | 6,699 | 12 | % | 40 | % | ||||||||||||||||||
Home equity lines | 140 | 139 | 157 | 1 | % | (11 | ) | % | |||||||||||||||||
Other consumer and credit card | 6 | 5 | 6 | 8 | % | (2 | ) | % | |||||||||||||||||
Total Consumer Banking | 9,548 | 8,547 | 6,862 | 12 | % | 39 | % | ||||||||||||||||||
Commercial Banking: | |||||||||||||||||||||||||
Commercial real estate & other commercial | 3,329 | 3,234 | 3,279 | 3 | % | 2 | % | ||||||||||||||||||
Mortgage warehouse finance | 1,186 | 1,311 | 851 | (10 | ) | % | 39 | % | |||||||||||||||||
Lender finance | 678 | 625 | 478 | 8 | % | 42 | % | ||||||||||||||||||
Commercial and commercial real estate | 5,193 | 5,170 | 4,608 | — | % | 13 | % | ||||||||||||||||||
Equipment financing receivables | 1,839 | 1,578 | 1,093 | 17 | % | 68 | % | ||||||||||||||||||
Total Commercial Banking | 7,032 | 6,748 | 5,701 | 4 | % | 23 | % | ||||||||||||||||||
Total Loans HFI | $ | 16,580 | $ | 15,295 | $ | 12,563 | 8 | % | 32 | % | |||||||||||||||
Total consumer banking loans HFI increased $1.0 billion, or 12%, compared to the prior quarter and $2.7 billion, or 39%, year over year, to $9.5 billion driven by strong residential mortgage loan growth. Residential loans increased $802 million, or 15%, in the quarter driven by retention of adjustable rate preferred jumbo loans.
Total commercial banking loans and leases HFI increased $284 million, or 4%, compared to the prior quarter and $1.3 billion, or 23%, year over year to $7.0 billion. Commercial real estate and other commercial loans increased $95 million, or 3%, to $3.3 billion, equipment financing receivables increased $262 million, or 17%, to $1.8 billion and lender finance increased $53 million, or 8%, to $678 million. Mortgage warehouse finance outstanding balances decreased $125 million, or 10%, compared to the prior quarter, to $1.2 billion.
Loan Origination Activities
Total originations were $3.1 billion and retained originations were $1.7 billion for the third quarter of 2014, increases of 5% and 4%, respectively, compared to the prior quarter driven by both commercial and consumer lending. Year to date, total retained originations were $4.3 billion.
Commercial originations were $754 million for the third quarter, an increase of 10% compared to the prior quarter and 115% year over year, driven by strong commercial and commercial real estate origination growth. Consumer originations were $2.3 billion for the third quarter of 2014, an increase of 3% compared to the prior quarter and a decrease of 15% year over year. Prime jumbo origination volume was $1.2 billion in the third quarter, an increase of 7% compared to the prior quarter and an increase of 55% year over year. The mix of purchase transactions for the third quarter was 59% of total originations and 72% of retail channel originations.
The following table presents total organic loan and lease origination information by product type:
($ in millions) | Sep 30, 2014 | Jun 30, 2014 | Sep 30, 2013 | % | % | |||||||||||||||||||
Consumer originations | ||||||||||||||||||||||||
Conventional loans | $ | 1,115 | $ | 1,125 | $ | 1,933 | (1 | ) | % | (42 | ) | % | ||||||||||||
Prime jumbo loans | 1,187 | 1,108 | 767 | 7 | % | 55 | % | |||||||||||||||||
2,302 | 2,233 | 2,700 | 3 | % | (15 | ) | % | |||||||||||||||||
Commercial originations | ||||||||||||||||||||||||
Commercial & commercial real estate | 361 | 285 | 174 | 27 | % | 107 | % | |||||||||||||||||
Equipment financing receivables | 393 | 399 | 177 | (1 | ) | % | 122 | % | ||||||||||||||||
754 | 684 | 351 | 10 | % | 115 | % | ||||||||||||||||||
Total organic originations | $ | 3,056 | $ | 2,917 | $ | 3,051 | 5 | % | — | % | ||||||||||||||
Deposits
Total deposits were $14.5 billion at September 30, 2014, an increase of 4% compared to the prior quarter and an increase of 6% year over year. Commercial deposits were $2.4 billion, an increase of 31% compared to the prior quarter and 35% year over year, and represented 16% of total deposits at quarter end.
At September 30, 2014, as compared to the second quarter of 2014 and third quarter of 2013, our deposits were comprised of the following:
($ in millions) | Sep 30, 2014 | Jun 30, 2014 | Sep 30, 2013 | % | % | ||||||||||||||
Noninterest-bearing demand | $ | 1,084 | $ | 1,056 | $ | 1,366 | 3 | % | (21 | ) | % | ||||||||
Interest-bearing demand | 2,941 | 2,802 | 2,999 | 5 | % | (2 | ) | % | |||||||||||
Savings and money market accounts | 5,160 | 4,864 | 5,186 | 6 | % | (1 | ) | % | |||||||||||
Global market-based accounts | 910 | 989 | 1,041 | (8 | ) | % | (13 | ) | % | ||||||||||
Time, excluding market-based | 4,379 | 4,164 | 3,036 | 5 | % | 44 | % | ||||||||||||
Total deposits | $ | 14,474 | $ | 13,875 | $ | 13,628 | 4 | % | 6 | % | |||||||||
Consumer deposits | $ | 12,088 | $ | 12,050 | $ | 11,864 | — | % | 2 | % | |||||||||
Commercial deposits | 2,386 | 1,824 | 1,764 | 31 | % | 35 | % | ||||||||||||
Total deposits | $ | 14,474 | $ | 13,875 | $ | 13,628 | 4 | % | 6 | % | |||||||||
Total other borrowings were $4.0 billion at September 30, 2014, compared to $3.8 billion in the prior quarter driven by increased Federal Home Loan Bank borrowings.
Capital Strength
Total shareholders' equity was $1.7 billion at September 30, 2014, an increase of 2% quarter over quarter and 7% year over year. The bank’s Tier 1 leverage ratio was 8.5% and the total risk-based capital ratio was 14.0% at September 30, 2014. As a result, the bank is considered "well-capitalized" under all applicable regulatory guidelines. Our common equity Tier 1 capital ratio at September 30, 2014 was 12.0% and our estimate of the fully phased-in Basel III common equity Tier 1 capital ratio was between 10.25% and 10.75%.
Credit Quality
Our adjusted non-performing assets were 0.50% of total assets at September 30, 2014, compared to 0.51% for the prior quarter and 1.01% at September 30, 2013. Net charge-offs during the third quarter of 2014 were $4 million, a decrease of $3 million, or 48%, compared to the prior quarter. On an annualized basis, net charge-offs were 0.09% of total average loans and leases held for investment, compared to 0.19% for the prior quarter and 0.30% for the third quarter of 2013.
Income Statement Highlights
Revenue
Revenue for the third quarter of 2014 was $235 million, an increase of $5 million, or 2%, from $229 million in the second quarter of 2014. The increase was driven by higher net interest income resulting from increased interest-earning assets.
Net Interest Income
For the third quarter of 2014, net interest income was $146 million, an increase of $6 million, or 4%, compared to the prior quarter. This increase resulted from a $1.7 billion, or 10%, increase in average interest-earning assets compared to the prior quarter, driven by higher residential mortgage loans HFI and loans HFS in addition to higher commercial loans and leases HFI, partially offset by higher average interest-bearing liabilities.
Net interest margin decreased to 3.02% for the third quarter of 2014 from 3.22% in the second quarter of 2014. The interest-earning asset yield declined 0.17% to 3.95%, driven by declines in both loans HFS and HFI yields. Partially offsetting this decline was a reduction in cost of total interest-bearing liabilities driven by lower cost of borrowings.
Noninterest Income
Noninterest income for the third quarter of 2014 was $88 million, a decrease of $1 million, or 1%, compared to the prior quarter. Gain on sale of loans was $48 million, flat compared to the prior quarter, driven by our loans held for sale activity including loan sales with an unpaid principal balance (UPB) of $2.2 billion. Net loan servicing income declined $2 million compared to the prior quarter driven by a $5 million decrease in loan servicing fee income resulting from the transfer of our default servicing UPB to Green Tree Servicing LLC in May 2014, partially offset by a $3 million valuation allowance recovery in the quarter.
Noninterest Expense
Noninterest expense for the third quarter of 2014 was $158 million, a decrease of $10 million, or 6%, compared to the prior quarter. Salaries, commissions and employee benefits were $91 million, a decrease of $4 million, or 5%, compared to the prior quarter driven by a full quarter benefit from the transfer of our default servicing platform in May 2014. General and administrative expense was $43 million, a decrease of $4 million, or 8%, compared to the prior quarter driven by a $2 million decrease in credit-related expenses and a $2 million decrease in other general and administrative expenses.
EverBank's efficiency ratio was 67%, compared to 73% in the prior quarter and 80% in the third quarter 2013.
Year to date, noninterest expense was $486 million, a 25% decrease from September 30, 2013. We continue to expect noninterest expense for the full year 2014 of $650 million.
Income Tax Expense
Our effective tax rate for the third quarter of 2014 was 38%, which was the same for the prior quarter and for the third quarter of 2013.
Segment Analysis for the Third Quarter of 2014
- Consumer Banking pre-tax income was $49 million, a 14% increase compared to $43 million in the prior quarter driven by a 1% increase in net interest income after provision and an 8% decrease in noninterest expense, offset by a 6% decrease in noninterest income.
- Commercial Banking pre-tax income was $47 million, a 20% increase compared to $39 million in the prior quarter, driven by an 8% increase in net interest income after provision and a 38% increase in noninterest income, offset by a 1% increase in noninterest expense.
- Corporate Services had a pre-tax loss of $26 million, a 1% decrease compared to $26 million in the prior quarter driven by a 2% decline in noninterest expense.
Dividends
On October 23, 2014, the Company's Board of Directors declared a quarterly cash dividend of $0.04 per common share, payable on November 24, 2014, to stockholders of record as of November 12, 2014. Also on October 23, 2014, the Company's Board of Directors declared a quarterly cash dividend of $421.875, payable on January 5, 2015, for each share of 6.75% Series A Non-Cumulative Perpetual Preferred Stock held as of December 19, 2014.
Conference Call and Webcast
The Company will host a conference call at 8:30 a.m. Eastern Time on Wednesday, October 29, 2014 to discuss its third quarter 2014 results. The dial-in number for the conference call is 1-866-270-1533 and the international dial-in number is 1-412-317-0797, passcode is 10054361. A live webcast of the conference call will also be available on the investor relations page of the Company's website at www.abouteverbank.com/ir.
About EverBank Financial Corp
EverBank Financial Corp, through its wholly-owned subsidiary EverBank, provides a diverse range of financial products and services directly to clients nationwide through multiple business channels. Headquartered in Jacksonville, Florida, EverBank has $20.5 billion in assets and $14.5 billion in deposits as of September 30, 2014. With an emphasis on value, innovation and service, EverBank offers a broad selection of banking, lending and investing products to consumers and businesses nationwide. EverBank provides services to clients through the internet, over the phone, through the mail, at its Florida-based financial centers and at other business offices throughout the country. More information on EverBank can be found at www.abouteverbank.com/ir.
Forward Looking Statements
This news release contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and such statements are intended to be covered by the safe harbor provided by the same. These statements may address issues that involve significant risks, uncertainties, estimates and assumptions made by management. Words such as “outlook,” “believes,” “expects,” “potential,” “continues,” “may,” “will,” “could,” “should,” “seeks,” “approximately,” “predicts,” “intends,” “plans,” “estimates,” “anticipates” or the negative version of those words or other comparable words are intended to identify forward-looking statements but are not the exclusive means of identifying such statements. These forward-looking statements are not historical facts, and are based on current expectations, estimates and projections about the Company’s asset growth and earnings, industry, management’s beliefs and certain assumptions made by management, many of which, by their nature, are inherently uncertain and beyond the Company’s control. Factors that could cause actual results to differ from those discussed in the forward-looking statements include, but are not limited to: deterioration of general business and economic conditions, including the real estate and financial markets, in the United States and in the geographic regions and communities we serve; risks related to liquidity; our capital and liquidity requirements (including under regulatory capital standards, such as Basel III capital standards) and our ability to generate or raise capital; changes in interest rates that affect the pricing of our financial products, the demand for our financial services and the valuation of our financial assets and liabilities, mortgage servicing rights and mortgages held for sale; risk of higher loan and lease charge-offs; legislative or regulatory actions affecting or concerning mortgage loan modification and refinancing and foreclosure; our ability to comply with any supervisory actions to which we are or become subject as a result of examination by our regulators; concentration of our commercial real estate loan portfolio; higher than normal delinquency and default rates; limited ability to rely on brokered deposits as a part of our funding strategy; our ability to comply with the amended consent order and the terms and conditions of our settlement of the Independent Foreclosure Review; concentration of mass-affluent clients and jumbo mortgages; hedging strategies; the effectiveness of our derivatives to manage interest rate risk; delinquencies on our equipment leases and reductions in the resale value of leased equipment; increases in loan repurchase requests and our reserves for loan repurchases; changes in currency exchange rates or other political or economic changes in certain foreign countries; loss of key personnel; fraudulent and negligent acts by loan applicants, mortgage brokers, other vendors and our employees; changes in and compliance with laws and regulations that govern our operations; failure to establish and maintain effective internal controls and procedures; effects of changes in existing U.S. government or government-sponsored mortgage programs; changes in laws and regulations that may restrict our ability to originate or increase our risk of liability with respect to certain mortgage loans; risks related to the approval and consummation of anticipated acquisitions and dispositions; risks related to the continuing integration of acquired businesses and any future acquisitions; environmental liabilities with respect to properties that we take title to upon foreclosure; and the inability of our banking subsidiary to pay dividends.
For additional factors that could materially affect our financial results, please refer to EverBank Financial Corp’s filings with the Securities and Exchange Commission, including but not limited to, the risks described under the headings “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” The Company undertakes no obligation to revise these statements following the date of this news release, except as required by law.
EverBank Financial Corp and Subsidiaries Condensed Consolidated Balance Sheets (unaudited) (Dollars in thousands, except per share data) | ||||||||||
September 30, | December 31, | |||||||||
Assets | ||||||||||
Cash and due from banks | $ | 57,835 | $ | 46,175 | ||||||
Interest-bearing deposits in banks | 306,265 | 801,603 | ||||||||
Total cash and cash equivalents | 364,100 | 847,778 | ||||||||
Investment securities: | ||||||||||
Available for sale, at fair value | 987,345 | 1,115,627 | ||||||||
Held to maturity (fair value of $115,529 and $107,921 as of September 30, 2014 and December 31, 2013, respectively) | 113,751 | 107,312 | ||||||||
Other investments | 194,314 | 128,063 | ||||||||
Total investment securities | 1,295,410 | 1,351,002 | ||||||||
Loans held for sale (includes $768,909 and $672,371 carried at fair value as of September 30, 2014 and December 31, 2013, respectively) | 871,736 | 791,382 | ||||||||
Loans and leases held for investment: | ||||||||||
Loans and leases held for investment, net of unearned income | 16,579,951 | 13,252,724 | ||||||||
Allowance for loan and lease losses | (57,245 | ) | (63,690 | ) | ||||||
Total loans and leases held for investment, net | 16,522,706 | 13,189,034 | ||||||||
Equipment under operating leases, net | 15,542 | 28,126 | ||||||||
Mortgage servicing rights (MSR), net | 441,243 | 506,680 | ||||||||
Deferred income taxes, net | 3,162 | 51,375 | ||||||||
Premises and equipment, net | 55,500 | 60,733 | ||||||||
Other assets | 940,943 | 814,874 | ||||||||
Total Assets | $ | 20,510,342 | $ | 17,640,984 | ||||||
Liabilities | ||||||||||
Deposits: | ||||||||||
Noninterest-bearing | $ | 1,084,400 | $ | 1,076,631 | ||||||
Interest-bearing | 13,389,105 | 12,184,709 | ||||||||
Total deposits | 14,473,505 | 13,261,340 | ||||||||
Other borrowings | 3,977,000 | 2,377,000 | ||||||||
Trust preferred securities | 103,750 | 103,750 | ||||||||
Accounts payable and accrued liabilities | 235,064 | 277,881 | ||||||||
Total Liabilities | 18,789,319 | 16,019,971 | ||||||||
Commitments and Contingencies | ||||||||||
Shareholders’ Equity | ||||||||||
Series A 6.75% Non-Cumulative Perpetual Preferred Stock, $0.01 par value (liquidation preference of $25,000 per share; 10,000,000 shares authorized; 6,000 issued and outstanding at September 30, 2014 and December 31, 2013) | 150,000 | 150,000 | ||||||||
Common Stock, $0.01 par value (500,000,000 shares authorized; 122,994,480 and 122,626,315 issued and outstanding at September 30, 2014 and December 31, 2013, respectively) | 1,230 | 1,226 | ||||||||
Additional paid-in capital | 840,667 | 832,351 | ||||||||
Retained earnings | 780,234 | 690,051 | ||||||||
Accumulated other comprehensive income (loss) (AOCI) | (51,108 | ) | (52,615 | ) | ||||||
Total Shareholders’ Equity | 1,721,023 | 1,621,013 | ||||||||
Total Liabilities and Shareholders’ Equity | $ | 20,510,342 | $ | 17,640,984 | ||||||
EverBank Financial Corp and Subsidiaries Condensed Consolidated Statements of Income (unaudited) (Dollars in thousands, except per share data) | ||||||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||||||
Interest Income | ||||||||||||||||||||
Interest and fees on loans and leases | $ | 180,913 | $ | 170,110 | $ | 509,708 | $ | 516,619 | ||||||||||||
Interest and dividends on investment securities | 9,627 | 13,376 | 29,276 | 44,439 | ||||||||||||||||
Other interest income | 116 | 493 | 388 | 1,108 | ||||||||||||||||
Total Interest Income | 190,656 | 183,979 | 539,372 | 562,166 | ||||||||||||||||
Interest Expense | ||||||||||||||||||||
Deposits | 26,755 | 24,437 | 72,804 | 77,827 | ||||||||||||||||
Other borrowings | 17,565 | 20,686 | 49,197 | 60,450 | ||||||||||||||||
Total Interest Expense | 44,320 | 45,123 | 122,001 | 138,277 | ||||||||||||||||
Net Interest Income | 146,336 | 138,856 | 417,371 | 423,889 | ||||||||||||||||
Provision for Loan and Lease Losses | 6,735 | 3,068 | 15,929 | 5,016 | ||||||||||||||||
Net Interest Income after Provision for Loan and Lease Losses | 139,601 | 135,788 | 401,442 | 418,873 | ||||||||||||||||
Noninterest Income | ||||||||||||||||||||
Loan servicing fee income | 35,900 | 50,713 | 122,934 | 140,068 | ||||||||||||||||
Amortization of mortgage servicing rights | (19,572 | ) | (30,438 | ) | (59,170 | ) | (101,461 | ) | ||||||||||||
Recovery (impairment) of mortgage servicing rights | 3,071 | 35,132 | 8,012 | 80,259 | ||||||||||||||||
Net loan servicing income | 19,399 | 55,407 | 71,776 | 118,866 | ||||||||||||||||
Gain on sale of loans | 47,920 | 51,397 | 129,474 | 209,545 | ||||||||||||||||
Loan production revenue | 5,783 | 10,514 | 15,709 | 30,066 | ||||||||||||||||
Deposit fee income | 3,828 | 4,952 | 11,696 | 15,167 | ||||||||||||||||
Other lease income | 3,910 | 6,506 | 12,621 | 19,388 | ||||||||||||||||
Other | 7,374 | 14,793 | 20,790 | 30,650 | ||||||||||||||||
Total Noninterest Income | 88,214 | 143,569 | 262,066 | 423,682 | ||||||||||||||||
Noninterest Expense | ||||||||||||||||||||
Salaries, commissions and other employee benefits expense | 90,781 | 111,144 | 283,734 | 340,080 | ||||||||||||||||
Equipment expense | 16,623 | 20,609 | 52,616 | 61,168 | ||||||||||||||||
Occupancy expense | 7,209 | 8,675 | 23,166 | 23,606 | ||||||||||||||||
General and administrative expense | 43,140 | 85,268 | 126,769 | 226,198 | ||||||||||||||||
Total Noninterest Expense | 157,753 | 225,696 | 486,285 | 651,052 | ||||||||||||||||
Income before Provision for Income Taxes | 70,062 | 53,661 | 177,223 | 191,503 | ||||||||||||||||
Provision for Income Taxes | 26,543 | 20,511 | 67,162 | 73,214 | ||||||||||||||||
Net Income | $ | 43,519 | $ | 33,150 | $ | 110,061 | $ | 118,289 | ||||||||||||
Less: Net Income Allocated to Preferred Stock | (2,532 | ) | (2,532 | ) | (7,594 | ) | (7,594 | ) | ||||||||||||
Net Income Allocated to Common Shareholders | $ | 40,987 | $ | 30,618 | $ | 102,467 | $ | 110,695 | ||||||||||||
Basic Earnings Per Common Share | $ | 0.33 | $ | 0.25 | $ | 0.83 | $ | 0.91 | ||||||||||||
Diluted Earnings Per Common Share | $ | 0.33 | $ | 0.25 | $ | 0.82 | $ | 0.89 | ||||||||||||
Dividends Declared Per Common Share | $ | 0.04 | $ | 0.03 | $ | 0.10 | $ | 0.07 | ||||||||||||
Non-GAAP Financial Measures
This press release contains financial information and performance measures determined by methods other than in accordance with accounting principles generally accepted in the United States of America (“GAAP”). Adjusted Non-Performing Asset Ratio, Tangible Shareholders’ Equity, Tangible Common Shareholders' Equity and Tangible Assets are non-GAAP financial measures. The Company’s management uses these measures to evaluate the underlying performance and efficiency of its operations. The Company’s management believes these non-GAAP measures provide meaningful additional information about the operating performance of the Company’s business and facilitate a meaningful comparison of our results in the current period to those in prior periods and future periods because these non-GAAP measures exclude certain items that may not be indicative of our core operating results and business outlook. In addition, the Company’s management believes that certain of these non-GAAP measures represent a consistent benchmark against which to evaluate the Company’s growth, profitability and capital position. These non-GAAP measures are provided to enhance investors’ overall understanding of our current financial performance, and not as a substitute for, the Company’s reported results. Moreover, the manner in which we calculate these measures may differ from that of other companies reporting non-GAAP measures with similar names.
In the tables below, we have provided a reconciliation of, where applicable, the most comparable GAAP financial measures and ratios to the non-GAAP financial measures and ratios used in this press release, or a reconciliation of the non-GAAP calculation of the financial measure for the periods indicated:
EverBank Financial Corp and Subsidiaries | ||||||||||||||||||||||||
Tangible Equity, Tangible Common Equity and Tangible Assets | ||||||||||||||||||||||||
(dollars in thousands) | September 30, | June 30, 2014 | March 31, 2014 | December 31, | September 30, | |||||||||||||||||||
Shareholders’ equity | $ | 1,721,023 | $ | 1,679,448 | $ | 1,647,639 | $ | 1,621,013 | $ | 1,602,913 | ||||||||||||||
Less: | ||||||||||||||||||||||||
Goodwill | 46,859 | 46,859 | 46,859 | 46,859 | 46,859 | |||||||||||||||||||
Intangible assets | 4,232 | 4,759 | 5,286 | 5,813 | 6,340 | |||||||||||||||||||
Tangible equity | 1,669,932 | 1,627,830 | 1,595,494 | 1,568,341 | 1,549,714 | |||||||||||||||||||
Less: | ||||||||||||||||||||||||
Perpetual preferred stock | 150,000 | 150,000 | 150,000 | 150,000 | 150,000 | |||||||||||||||||||
Tangible common equity | $ | 1,519,932 | $ | 1,477,830 | $ | 1,445,494 | $ | 1,418,341 | $ | 1,399,714 | ||||||||||||||
Total assets | $ | 20,510,342 | $ | 19,753,820 | $ | 17,630,948 | $ | 17,640,984 | $ | 17,612,089 | ||||||||||||||
Less: | ||||||||||||||||||||||||
Goodwill | 46,859 | 46,859 | 46,859 | 46,859 | 46,859 | |||||||||||||||||||
Intangible assets | 4,232 | 4,759 | 5,286 | 5,813 | 6,340 | |||||||||||||||||||
Tangible assets | $ | 20,459,251 | $ | 19,702,202 | $ | 17,578,803 | $ | 17,588,312 | $ | 17,558,890 | ||||||||||||||
EverBank Financial Corp and Subsidiaries | ||||||||||||||||||||||||||
Regulatory Capital (bank level) | ||||||||||||||||||||||||||
(dollars in thousands) | September 30, | June 30, 2014 | March 31, 2014 | December 31, | September 30, | |||||||||||||||||||||
Shareholders’ equity | $ | 1,769,205 | $ | 1,714,454 | $ | 1,686,414 | $ | 1,662,164 | $ | 1,648,152 | ||||||||||||||||
Less: | Goodwill and other intangibles | (49,957 | ) | (50,328 | ) | (50,700 | ) | (51,072 | ) | (51,436 | ) | |||||||||||||||
Disallowed servicing asset | (23,524 | ) | (29,028 | ) | (26,419 | ) | (20,469 | ) | (39,658 | ) | ||||||||||||||||
Disallowed deferred tax asset | — | (61,737 | ) | (62,682 | ) | (63,749 | ) | (64,462 | ) | |||||||||||||||||
Add: | Accumulated losses on securities and cash flow hedges | 49,516 | 52,121 | 51,507 | 50,608 | 54,392 | ||||||||||||||||||||
Tier 1 capital | 1,745,240 | 1,625,482 | 1,598,120 | 1,577,482 | 1,546,988 | |||||||||||||||||||||
Add: | Allowance for loan and lease losses | 57,245 | 56,728 | 62,969 | 63,690 | 66,991 | ||||||||||||||||||||
Total regulatory capital | $ | 1,802,485 | $ | 1,682,210 | $ | 1,661,089 | $ | 1,641,172 | $ | 1,613,979 | ||||||||||||||||
Adjusted total assets | $ | 20,480,723 | $ | 19,660,793 | $ | 17,539,708 | $ | 17,554,236 | $ | 17,510,528 | ||||||||||||||||
Risk-weighted assets | 12,869,352 | 12,579,476 | 11,597,320 | 11,467,411 | 11,120,048 | |||||||||||||||||||||
Regulatory Capital (EFC consolidated) | ||||||||||||||||||||||||||
(dollars in thousands) | Sep 30, 2014 | Jun 30, 2014 | Mar 31, 2014 | Dec 31, 2013 | Sep 30, 2013 | |||||||||||||||||||||
Shareholders’ equity | $ | 1,721,023 | $ | 1,679,448 | $ | 1,647,639 | $ | 1,621,013 | $ | 1,602,913 | ||||||||||||||||
Less: | Preferred stock | (150,000 | ) | (150,000 | ) | (150,000 | ) | (150,000 | ) | (150,000 | ) | |||||||||||||||
Goodwill and other intangibles | (49,957 | ) | (50,328 | ) | (50,700 | ) | (51,072 | ) | (51,436 | ) | ||||||||||||||||
Disallowed servicing asset | (23,524 | ) | (29,028 | ) | (26,419 | ) | (20,469 | ) | (39,658 | ) | ||||||||||||||||
Disallowed deferred tax asset | — | (61,737 | ) | (62,682 | ) | (63,749 | ) | (64,462 | ) | |||||||||||||||||
Add: | Accumulated losses on securities and cash flow hedges | 51,108 | 53,936 | 53,647 | 52,615 | 56,879 | ||||||||||||||||||||
Common tier 1 capital | $ | 1,548,650 | $ | 1,442,291 | $ | 1,411,485 | $ | 1,388,338 | $ | 1,354,236 | ||||||||||||||||
Risk-weighted assets | $ | 12,875,007 | 12,583,537 | 11,600,258 | 11,469,483 | 11,120,445 | ||||||||||||||||||||
EverBank Financial Corp and Subsidiaries | |||||||||||||||||||||||||
Non-Performing Assets(1) | |||||||||||||||||||||||||
(dollars in thousands) | September 30, | June 30, 2014 | March 31, 2014 | December 31, | September 30, | ||||||||||||||||||||
Non-accrual loans and leases: | |||||||||||||||||||||||||
Consumer Banking: | |||||||||||||||||||||||||
Residential mortgages | $ | 23,067 | $ | 22,212 | $ | 47,835 | $ | 59,526 | $ | 60,066 | |||||||||||||||
Home equity lines | 2,152 | 1,903 | 3,462 | 3,270 | 4,164 | ||||||||||||||||||||
Other consumer and credit card | 31 | 20 | 33 | 18 | 15 | ||||||||||||||||||||
Commercial Banking: | |||||||||||||||||||||||||
Commercial and commercial real estate | 46,819 | 44,172 | 23,884 | 18,569 | 76,662 | ||||||||||||||||||||
Equipment financing receivables | 6,803 | 6,475 | 5,446 | 4,527 | 4,171 | ||||||||||||||||||||
Total non-accrual loans and leases | 78,872 | 74,782 | 80,660 | 85,910 | 145,078 | ||||||||||||||||||||
Accruing loans 90 days or more past due | — | — | — | — | — | ||||||||||||||||||||
Total non-performing loans (NPL) | 78,872 | 74,782 | 80,660 | 85,910 | 145,078 | ||||||||||||||||||||
Other real estate owned (OREO) | 24,501 | 25,530 | 29,333 | 29,034 | 32,108 | ||||||||||||||||||||
Total non-performing assets (NPA) | 103,373 | 100,312 | 109,993 | 114,944 | 177,186 | ||||||||||||||||||||
Troubled debt restructurings (TDR) less than 90 days past due | 16,547 | 16,687 | 73,455 | 76,913 | 79,664 | ||||||||||||||||||||
Total NPA and TDR(1) | $ | 119,920 | $ | 116,999 | $ | 183,448 | $ | 191,857 | $ | 256,850 | |||||||||||||||
Total NPA and TDR | $ | 119,920 | $ | 116,999 | $ | 183,448 | $ | 191,857 | $ | 256,850 | |||||||||||||||
Government insured 90 days or more past due still accruing | 2,632,744 | 2,424,166 | 1,021,276 | 1,039,541 | 1,147,795 | ||||||||||||||||||||
Loans accounted for under ASC 310-30: | |||||||||||||||||||||||||
90 days or more past due | 10,519 | 23,159 | 9,915 | 10,083 | 45,104 | ||||||||||||||||||||
OREO | — | — | — | — | 21,240 | ||||||||||||||||||||
Total regulatory NPA and TDR | $ | 2,763,183 | $ | 2,564,324 | $ | 1,214,639 | $ | 1,241,481 | $ | 1,470,989 | |||||||||||||||
Adjusted credit quality ratios excluding government insured loans and loans accounted for under ASC 310-30: (1) | |||||||||||||||||||||||||
NPL to total loans | 0.45 | % | 0.44 | % | 0.56 | % | 0.61 | % | 1.07 | % | |||||||||||||||
NPA to total assets | 0.50 | % | 0.51 | % | 0.62 | % | 0.65 | % | 1.01 | % | |||||||||||||||
NPA and TDR to total assets | 0.58 | % | 0.59 | % | 1.04 | % | 1.09 | % | 1.46 | % | |||||||||||||||
Credit quality ratios including government insured loans and loans accounted for under ASC 310-30: | |||||||||||||||||||||||||
NPL to total loans | 15.65 | % | 14.89 | % | 7.72 | % | 8.12 | % | 9.87 | % | |||||||||||||||
NPA to total assets | 13.39 | % | 12.90 | % | 6.47 | % | 6.60 | % | 7.90 | % | |||||||||||||||
NPA and TDR to total assets | 13.47 | % | 12.98 | % | 6.89 | % | 7.04 | % | 8.35 | % | |||||||||||||||
(1) We define non-performing assets, or NPA, as non-accrual loans, accruing loans past due 90 days or more and foreclosed property. Our NPA calculation excludes government insured pool buyout loans for which payment is insured by the government. We also exclude loans and foreclosed property accounted for under ASC 310-30 because we expect to fully collect the carrying value of such loans and foreclosed property. |
Contacts:
Media Contact:
Michael
Cosgrove, 904-623-2029
Michael.Cosgrove@EverBank.com
or
Investor
Relations:
Scott Verlander, 904-623-8455
Investor.Relations@EverBank.com