TOWNSHIP OF WASHINGTON, N.J., Jan. 24, 2013 (GLOBE NEWSWIRE) -- Oritani Financial Corp. (the "Company" or "Oritani") (Nasdaq:ORIT), the holding company for Oritani Bank (the "Bank"), reported net income of $8.7 million, or $0.21 per basic (and $0.20 diluted) common share, for the three months ended December 31, 2012, and $18.0 million, or $0.43 per basic (and $0.42 diluted) common share, for the six months ended December 31, 2012. This compares to net income of $7.6 million, or $0.18 per basic and diluted common share, for the three months ended December 31, 2011, and $15.0 million, or $0.33 per basic (and $0.32 diluted) common share, for the six months ended December 31, 2011.
The Company also reported that its Board of Directors has declared a $0.15 quarterly cash dividend on the Company's common stock. The record date for the dividend will be February 8, 2013 and the payment date will be February 22, 2013.
"It has been another very successful quarter for Oritani. With an annualized ROA of 1.27% and an efficiency ratio of 38.1%, we continue to be one of the top performing banks in the country" said Kevin J. Lynch, the Company's Chairman, President and CEO. "However the economic landscape remains uncertain and we are very mindful of that fact. I have been pleased with our loan growth, especially given the high quality underwriting standards that we maintain." Mr. Lynch continued, "It is a transitional period here at Oritani, as our spread and margin began to contract this quarter. This event was inevitable given the current interest rate environment. However, we are still poised for net interest income expansion, primarily through additional loan originations, and ongoing solid results buoyed by our expense management."
Comparison of Operating Results for the Periods Ended December 31, 2012 and 2011
Net Income
Net income increased $1.1 million, or 14.7%, to $8.7 million for the quarter ended December 31, 2012, from $7.6 million for the corresponding 2011 quarter. Net income increased $3.0 million, or 20.0%, to $18.0 million for the six months ended December 31, 2012, from $15.0 million for the corresponding 2011 period. The primary cause of the increased income in the 2012 periods was increased net interest income and decreased provision for loan losses.
Total Interest Income
The components of interest income for the three months ended December 31, 2012 and 2011, changed as follows:
Three Months Ended December 31 | Increase / (decrease) | ||||||
2012 | 2011 | Average | |||||
$ | Yield | $ | Yield | $ | Balance | Yield | |
(dollars in thousands) | |||||||
Interest on mortgage loans | $ 29,079 | 5.49% | $ 26,936 | 6.06% | $ 2,143 | $ 339,318 | -0.57% |
Interest on securities HTM and dividends on FHLB stock | 437 | 4.18% | 281 | 3.30% | 156 | 7,797 | 0.88% |
Interest on securities AFS | 58 | 1.94% | 304 | 2.34% | (246) | (40,072) | -0.40% |
Interest on MBS HTM | 225 | 2.58% | 226 | 2.55% | (1) | (619) | 0.03% |
Interest on MBS AFS | 1,807 | 1.74% | 2,776 | 1.87% | (969) | (180,625) | -0.13% |
Interest on federal funds sold and short term investments | 1 | 0.25% | 1 | 0.24% | (102) | 0.01% | |
Total interest income | $ 31,607 | 4.82% | $ 30,524 | 4.89% | $ 1,083 | $ 125,697 | -0.07% |
The changes in average balance reveal the effects of two of the Company's strategic business decisions. The Company's primary focus is organic growth of multifamily and commercial real estate loans. The average balance of loans increased $339.3 million over the periods. On a linked quarter basis (December 31, 2012 versus September 30, 2012), the average balance of loans grew $98.2 million. The growth was primarily achieved through originations. Loan originations totaled $141.6 million for the three months ended December 31, 2012. The yield on the loan portfolio decreased 57 basis points for the quarter ended December 31, 2012 versus the comparable 2011 period. The decreased yield was primarily due to the impact of current market rates on new originations, refinancings, prepayments and repricings. The decrease would have been larger; however, prepayment penalties were higher in the 2012 period. Prepayment penalties are recognized as interest on loans. Prepayment penalties totaled $1.2 million in the 2012 period versus $387,000 in the 2011 period. Prepayment penalty provisions are incorporated into all of the Company's multifamily and commercial real estate loan documents. The penalties are intended to protect the Company from the prepayment of loans or provide the Company with compensation if the loan is prepaid. The current interest rate environment provides an economic incentive for many of our existing loans to refinance, despite the prepayment penalties. Prepayment penalties boosted annualized loan yield by 23 basis points in the 2012 period versus 9 basis points in the 2011 period. The second strategic business decision evidenced in the chart was the determination to no longer deploy the cash flows from the investment portfolio back into new investments. This decision impacted the periods subsequent to September 30, 2011 and was made because the Company determined that the risk/reward profiles of permissible securities no longer warranted additional investment. Consequently, the average balances of virtually all the investment related captions declined from 2011 to 2012. The only average balance caption that showed an increase was securities held to maturity and this was only due to required purchases of FHLB stock. The decision has aided overall yield on interest earning assets as the Company now has a lower percentage of its interest earning assets in lower yielding assets like mortgage backed securities ("MBS"), investment securities and federal funds sold. The limited decrease in yield on interest earnings assets that occurred in 2012 versus 2011 (7 basis points), despite a much lower interest rate environment, is partially attributable to this decision.
The components of interest income for the six months ended December 31, 2012 and 2011, changed as follows:
Six Months Ended December 31 | Increase / (decrease) | ||||||
2012 | 2011 | Average | |||||
$ | Yield | $ | Yield | $ | Balance | Yield | |
(dollars in thousands) | |||||||
Interest on mortgage loans | $ 58,161 | 5.62% | $ 52,865 | 6.06% | $ 5,296 | $ 324,415 | -0.44% |
Interest on securities HTM and dividends on FHLB stock | 844 | 4.20% | 580 | 3.75% | 264 | 9,277 | 0.45% |
Interest on securities AFS | 132 | 1.64% | 686 | 1.96% | (554) | (54,117) | -0.32% |
Interest on MBS HTM | 459 | 2.60% | 475 | 2.62% | (16) | (920) | -0.02% |
Interest on MBS AFS | 3,831 | 1.75% | 5,634 | 1.96% | (1,803) | (136,694) | -0.21% |
Interest on federal funds sold and short term investments | 2 | 0.25% | 30 | 0.29% | (28) | (19,066) | -0.04% |
Total interest income | $ 63,429 | 4.88% | $ 60,270 | 4.87% | $ 3,187 | $ 122,895 | 0.01% |
The explanations for changes described above for the three month period are also applicable to the six month period. Loan originations for the six months ended December 31, 2012 totaled $359.6 million. Prepayment penalties totaled $2.6 million in the 2012 period versus $485,000 in the 2011 period, and boosted annualized loan yield by 25 basis points in the 2012 period versus 6 basis points in the 2011 period.
Total Interest Expense.
The components of interest expense for the three months ended December 31, 2012 and 2011, changed as follows:
Three Months Ended December 31 | Increase / (decrease) | ||||||
2012 | 2011 | Average | |||||
$ | Cost | $ | Cost | $ | Balance | Cost | |
(dollars in thousands) | |||||||
Savings deposits | $ 97 | 0.28% | $ 160 | 0.41% | $ (63) | $ (16,590) | -0.13% |
Money market | 550 | 0.49% | 677 | 0.72% | (127) | 71,682 | -0.23% |
Checking accounts | 138 | 0.22% | 214 | 0.42% | (76) | 44,660 | -0.20% |
Time deposits | 1,350 | 1.04% | 2,241 | 1.39% | (891) | (123,846) | -0.35% |
Total deposits | 2,135 | 0.63% | 3,292 | 0.95% | (1,157) | (24,094) | -0.32% |
Borrowings | 5,401 | 2.62% | 5,195 | 3.12% | 206 | 158,453 | -0.50% |
Total interest expense | $ 7,536 | 1.38% | $ 8,487 | 1.66% | $ (951) | $ 134,359 | -0.28% |
The Company continued its strategic objective of increasing core deposits. However, increases in core account balances have been offset by decreases in time deposits. Overall deposit growth has not met management's expectations. The Company has managed deposit costs with a priority on profitability. Deposits costs are compared to alternate sources of funds and priced accordingly. This approach has contributed to increased income but has negatively impacted overall deposit growth and caused an increased reliance on borrowings. Management is considering adjustments to this strategy with a goal of increasing deposits, although such strategies may negatively impact costs. The average cost of interest bearing deposits decreased 32 basis points over the periods. On a linked quarter basis, the average cost of interest bearing deposits decreased 5 basis points. The average balance of borrowings increased significantly ($158.5 million) over the period while the cost decreased significantly (50 basis points). Overnight and other short term borrowings totaled $285.0 million at December 31, 2012. These borrowings had a very low cost associated with them and the rate of interest on these borrowings is expected to remain low for the foreseeable future. However, the Company is aware of the risk inherent in short term borrowings. As discussed in prior public filings, the Company has taken steps to mitigate the risk associated with its borrowing position. The Company is poised to deploy additional strategies to mitigate this risk and is regularly analyzing the most opportune time to deploy such strategies. The aforementioned goal of increasing deposits, if achieved, will also reduce the short term borrowing level.
The components of interest expense for the six months ended December 31, 2012 and 2011, changed as follows:
Six Months Ended December 31 | Increase / (decrease) | ||||||
2012 | 2011 | Average | |||||
$ | Cost | $ | Cost | $ | Balance | Cost | |
(dollars in thousands) | |||||||
Savings deposits | $ 195 | 0.28% | $ 371 | 0.48% | $ (176) | $ (16,002) | -0.20% |
Money market | 1,109 | 0.50% | 1,517 | 0.79% | (408) | 63,022 | -0.29% |
Checking accounts | 273 | 0.22% | 426 | 0.45% | (153) | 54,555 | -0.23% |
Time deposits | 2,892 | 1.08% | 4,661 | 1.42% | (1,769) | (120,110) | -0.34% |
Total deposits | 4,469 | 0.66% | 6,975 | 1.01% | (2,506) | (18,535) | -0.35% |
Borrowings | 10,699 | 2.71% | 10,271 | 3.43% | 428 | 190,269 | -0.72% |
Total interest expense | $ 15,168 | 1.41% | $ 17,246 | 1.74% | $ (2,078) | $ 171,734 | -0.33% |
The explanations for changes described above for the three month period are also applicable to the six month period.
Net Interest Income Before Provision for Loan Losses. Net interest income increased by $2.0 million, or 9.2%, to $24.1 million for the three months ended December 31, 2012, from $22.0 million for the three months ended December 31, 2011. Net interest income increased by $5.2 million, or 12.2%, to $48.3 million for the six months ended December 31, 2012, from $43.0 million for the six months ended December 31, 2011. The Company's net interest income, spread and margin over the period are detailed in the chart below.
Net Interest | |||
Income Before | |||
Quarter Ended | Provision | Spread | Margin |
(dollars in thousands) | |||
December 31, 2012 | $ 24,071 | 3.44% | 3.67% |
September 30, 2012 | 24,190 | 3.50% | 3.76% |
June 30, 2012 | 23,335 | 3.40% | 3.66% |
March 31, 2012 | 22,298 | 3.30% | 3.58% |
December 31, 2011 | 22,037 | 3.23% | 3.53% |
September 30, 2011 | 20,987 | 3.02% | 3.42% |
The Company's spread and margin increased steadily over the 2012 fiscal year. That expansion had continued into the first quarter of the current fiscal year but retreated somewhat in the current quarter. As previously stated, the Company expects that its spread and margin will remain under pressure in the current interest rate environment due to several factors, including: rates on new loan originations and investment purchases; modifications of loans within the existing loan portfolio; prepayments of higher yielding loans and investments; limited ability to further reduce deposit and borrowing costs; promotional interest costs to attract new deposit customers and increases in borrowing costs which may be necessary to reduce interest rate risk. The Company has been able to largely offset these pressures. Several factors have contributed to this result. One such factor has been the utilization of short term borrowings. In the recent rate environment, such borrowings have a very low cost which contributed to the increased spread, margin and net interest income. The shifting of assets out of investments and into higher yielding loans also contributed to increased spread, margin and net interest income. In addition, the Company has been able to lower the cost of overall deposits. The Company believes that the most effective means for it to offset the impact of decreased spread and margin is loan growth, through quality loan originations. The Company has been able to achieve quality loan growth and continuation of this occurrence remains one of its strategic goals. The Company's largest interest rate risk exposure is to a flat or inverted yield curve
A component of the strong performance of the spread, margin and net interest income has been prepayment penalties (discussed in Total Interest Income). The prepayment penalties boosted the spread and margin for the quarter ended December 31, 2012 by 18 basis points each. The penalty income also boosted the September 30, 2012 quarterly spread and margin by 21 and 22 basis points, respectively and the June 30, 2012 quarterly spread and margin by 10 basis points each.
The Company's net interest income and net interest rate spread were both negatively impacted in all periods due to the reversal of accrued interest income on loans delinquent more than 90 days. The total of such income reversed was $486,000 and $1.3 million for the three and six months ended December 31, 2012, respectively, and $322,000 and $650,000 for the three and six months ended December 31, 2011, respectively.
Provision for Loan Losses. The Company recorded provisions for loan losses of $1.5 million for the three months ended December 31, 2012 as compared to $2.0 million for the three months ended December 31, 2011. The Company recorded provisions for loan losses of $3.0 million for the six months ended December 31, 2012 as compared to $5.5 million for the six months ended December 31, 2011. A rollforward of the allowance for loan losses for the three and six months ended December 31, 2012 and 2011 is presented below:
Quarter ended | Six months ended | |||
December 31, | December 31, | |||
2012 | 2011 | 2012 | 2011 | |
(Dollars in thousands) | ||||
Balance at beginning of period | $32,504 | $27,540 | $31,187 | $26,514 |
Provisions charged to operations | 1,500 | 2,000 | 3,000 | 5,500 |
Recoveries of loans previously charged off | 116 | -- | 117 | -- |
Loans charged off | 2,211 | 721 | 2,395 | 3,195 |
Balance at end of period | $31,909 | $28,819 | $31,909 | $28,819 |
Allowance for loan losses to total loans | 1.44% | 1.55% | 1.44% | 1.55% |
Net charge-offs (annualized) to average loans outstanding | 0.40% | 0.16% | 0.22% | 0.37% |
The primary contributors to the current level of provision for loan losses are the delinquency and nonaccrual totals, changes in loan risk ratings, loan growth, charge-offs and economic factors.
Delinquency and non performing asset information is provided below:
12/31/2012 | 9/30/2012 | 6/30/2012 | 3/31/2012 | 12/31/2011 | |
(dollars in thousands) | |||||
Delinquency Totals | |||||
30 - 59 days past due | $ 8,169 | $ 15,544 | $ 13,783 | $ 11,325 | $ 12,823 |
60 - 89 days past due | 7,005 | 7,363 | 8,555 | 7,900 | 7,939 |
Nonaccrual | 29,401 | 26,275 | 18,342 | 18,715 | 18,244 |
Total | $ 44,575 | $ 49,182 | $ 40,680 | $ 37,940 | $ 39,006 |
Non Performing Asset Totals | |||||
Nonaccrual loans, per above | $ 29,401 | $ 26,275 | $ 18,342 | $ 18,715 | $ 18,244 |
Real Estate Owned | 2,817 | 2,837 | 2,740 | 4,266 | 4,951 |
Total | $ 32,218 | $ 29,112 | $ 21,082 | $ 22,981 | $ 23,195 |
Nonaccrual loans to total loans | 1.32% | 1.22% | 0.90% | 0.96% | 0.98% |
Delinquent loans to total loans | 2.01% | 2.28% | 2.00% | 1.95% | 2.10% |
Non performing assets to total assets | 1.15% | 1.04% | 0.78% | 0.87% | 0.89% |
Total delinquent loans have decreased slightly from the September 30, 2012 total but, in management's opinion, remain at an elevated level. Over the quarter, the notes regarding a construction loan relationship in which Oritani was a participant were sold. Oritani did not lend any funds to the purchaser. A charge off was incurred in conjunction with this sale which constituted the majority of the charge off total for the quarter. The bulk of the charge off total on this relationship was previously recognized as an impairment reserve. Despite this disposal, nonaccrual loans increased versus the September 31, 2012 total. Management has worked diligently to remedy these matters. As detailed below, some progress did occur over the quarter although full resolution has not yet occurred.
At December 31, 2012, there are nine nonaccrual loans with balances greater than $1.0 million. These loans are discussed below:
There is one other loan greater than $1.0 million classified as nonaccrual at December 31, 2012 (with a balance of $1.5 million) which we are currently evaluating for impairment. The loan is classified as Substandard and carries a general reserve allocation consistent with our other Substandard loans at December 31, 2012.
There are twenty-one other multifamily/commercial real estate loans, totaling $7.7 million, classified as nonaccrual at December 31, 2012. The largest of these loans has a balance of $780,000.
There are ten other residential loans, totaling $3.4 million, classified as nonaccrual at December 31, 2012. The largest of these loans has a balance of $958,000.
Other Income. Other income decreased $33,000 to $887,000 for the three months ended December 31, 2012, from $920,000 for the three months ended December 31, 2011. The decrease is primarily due to a $342,000 decrease on income from investments in joint ventures. As discussed in prior public releases, income is expected to be below historical levels for the remainder of the fiscal year. The reason primarily relates to one commercial property that incurred flood damage in 2011. Repairs on this property were extensive and the situation has caused changes in the tenant base. During the quarter ended December 31, 2012, the situation was exacerbated by negative adjustments to expected insurance reimbursements. An overall loss of $127,000 was incurred on investments in real estate joint ventures for the quarter ended December 31, 2012, primarily due to the results at the commercial property. The other significant change for the quarter was due to a $262,000 impairment charge for equity securities that was recognized in the 2011 period. A similar charge was not incurred in 2012.
Other income decreased $714,000 to $2.1 million for the six months ended December 31, 2012 from $2.8 million for the six months ended December 31, 2011. The six month period was also impacted by the issues described above regarding income from investments in joint ventures and net loss on sale and writedowns of securities. In addition, a net gain on sale of assets of $557,000 was realized in 2011. This net gain primarily pertained to the sale of a loan classified as held for sale. Gains on sale of assets totaled $44,000 in the 2012 period resulting in a decrease of $513,000 between the periods.
Operating Expenses. Operating expenses increased $443,000 to $9.5 million for the three months ended December 31, 2012, from $9.1 million for the three months ended December 31, 2011. The increase was primarily due to compensation, payroll taxes and fringe benefits, which increased $527,000 to $7.0 million for the three months ended December 31, 2012, from $6.4 million for the three months ended December 31, 2011. The increase was primarily due to expenses associated with the Company's ESOP as increases in the trading price of Company's common stock caused increases in related ESOP expenses. There were also increases in direct compensation due to additional staffing and salary adjustments.
Operating expenses increased $1.5 million to $18.7 million for the six months ended December 31, 2012, from $17.3 million for the six months ended December 31, 2011. The increase was primarily due to compensation, payroll taxes and fringe benefits, which increased $1.8 million to $13.9 million for the six months ended December 31, 2012, from $12.0 million for the six months ended December 31, 2011. The six month period was affected by the items described above for the three month period but also impacted by costs associated with stock based compensation. Stock awards and options were granted under the Company's 2011 Equity Incentive Plan ("the Equity Plan") on August 18, 2011. The 2011 period only contained 4.5 months of amortization of Equity Plan costs versus 6 months in the 2012 period. Expenses associated with the Equity Plan were $710,000 greater in the 2012 period versus the 2011 period.
Income Tax Expense. Income tax expense for the three months ended December 31, 2012 was $5.2 million on pre-tax income of $14.0 million, resulting in an effective tax rate of 37.3%. Income tax expense for the three months ended December 31, 2011 was $4.3 million on pre-tax income of $11.9 million, resulting in an effective tax rate of 35.9%. Income tax expense for the six months ended December 31, 2012, was $10.7 million, due to pre-tax income of $28.6 million, resulting in an effective tax rate of 37.3%. For the six months ended December 31, 2011, income tax expense was $8.1 million, due to pre-tax income of $23.1 million, resulting in an effective tax rate of 35.2%.
Comparison of Financial Condition at December 31, 2012 and June 30, 2012
Total Assets. Total assets increased $108.7 million, or 4.0%, to $2.81 billion at December 31, 2012, from $2.70 billion at June 30, 2012. The primary investing activity was in loans funded by increases in short term borrowings and cash flows from the investment portfolio.
Cash and Cash Equivalents. Cash and cash equivalents (which include fed funds and short term investments) decreased $1.4 million to $10.1 million at December 31, 2012, from $11.4 million at June 30, 2012.
Net Loans. Loans, net increased $189.3 million, or 9.5%, to $2.18 billion at December 31, 2012, from $1.99 billion at June 30, 2012. The Company continues its emphasis on loan originations, particularly multifamily and commercial real estate loans. Loan originations totaled $359.6 million for the six months ended December 31, 2012 versus $262.1 million for the six months ended December 31, 2011.
Mortgage-backed Securities Available For Sale. Mortgage-backed securities AFS decreased $85.5 million to $388.4 million at December 31, 2012, from $473.9 million at June 30, 2012.
Deposits. Deposits decreased $38.0 million, or 2.7%, to $1.35 billion at December 31, 2012, from $1.39 billion at June 30, 2012. Growth in core deposit accounts was offset by outflows of time deposits.
Borrowings. Borrowings increased $147.7 million, or 19.8%, to $893.6 million at December 31, 2012, from $745.9 million at June 30, 2012.
Stockholders' Equity. Stockholders' equity decreased $4.5 million to $506.2 million at December 31, 2012, from $510.7 million at June 30, 2012. The decrease was primarily the result of dividends, including a $0.40 special dividend paid in December, 2012, partially offset by net income. Based on our December 31, 2012 closing price of $15.32 per share, the Company stock was trading at 137.4% of book value.
About the Company
Oritani Financial Corp. is the holding company for Oritani Bank, a New Jersey state chartered bank offering a full range of retail and commercial loan and deposit products. Oritani Bank is dedicated to providing exceptional personal service to its individual and business customers. The Bank currently operates its main office and 24 full service branches in the New Jersey Counties of Bergen, Hudson, Essex and Passaic. For additional information about Oritani Bank, please visit www.oritani.com.
Forward Looking Statements
Certain statements contained herein are "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Such forward-looking statements may be identified by reference to a future period or periods, or by the use of forward-looking terminology, such as "may," "will," "believe," "expect," "estimate," "anticipate," "continue," or similar terms or variations on those terms, or the negative of those terms. Forward-looking statements are subject to numerous risks and uncertainties, including, but not limited to, those related to the economic environment, particularly in the market areas in which the Company operates, competitive products and pricing, fiscal and monetary policies of the U.S. Government, changes in government regulations affecting financial institutions, including regulatory fees and capital requirements, changes in prevailing interest rates, acquisitions and the integration of acquired businesses, credit risk management, asset-liability management, the financial and securities markets and the availability of and costs associated with sources of liquidity and other factors discussed in the periodic reports filed by the Company with the Securities and Exchange Commission.
The Company wishes to caution readers not to place undue reliance on any such forward-looking statements, which speak only as of the date made. The Company wishes to advise readers that the factors listed above could affect the Company's financial performance and could cause the Company's actual results for future periods to differ materially from any opinions or statements expressed with respect to future periods in any current statements. The Company does not undertake and specifically declines any obligation to publicly release the result of any revisions, which may be made to any forward-looking statements to reflect events or circumstances after the date of such statements or to reflect the occurrence of anticipated or unanticipated events.
Oritani Financial Corp. and Subsidiaries | ||
Township of Washington, New Jersey | ||
Consolidated Balance Sheets | ||
(in thousands, except share data) | ||
December 31, | June 30, | |
Assets | 2012 | 2012 |
(unaudited) | ||
Cash on hand and in banks | $ 4,216 | $ 4,016 |
Federal funds sold and short term investments | 5,857 | 7,423 |
Cash and cash equivalents | 10,073 | 11,439 |
Loans, net | 2,182,162 | 1,992,817 |
Securities available for sale, at fair value | 11,940 | 26,031 |
Mortgage-backed securities held to maturity, fair value of $35,808 and $37,648 at December 31, 2012 and June 30, 2012, respectively | 33,974 | 36,130 |
Mortgage-backed securities available for sale, at fair value | 388,438 | 473,920 |
Bank Owned Life Insurance (at cash surrender value) | 57,743 | 46,283 |
Federal Home Loan Bank of New York stock ("FHLB"), at cost | 44,919 | 38,222 |
Accrued interest receivable | 9,479 | 10,630 |
Investments in real estate joint ventures, net | 5,525 | 5,441 |
Real estate held for investment | 1,000 | 1,123 |
Real estate owned | 2,817 | 2,740 |
Office properties and equipment, net | 15,173 | 15,442 |
Deferred tax assets | 27,341 | 25,570 |
Other assets | 19,102 | 15,194 |
Total Assets | $ 2,809,686 | $ 2,700,982 |
Liabilities | ||
Deposits | $ 1,351,666 | $ 1,389,706 |
Borrowings | 893,578 | 745,865 |
Advance payments by borrowers for taxes and insurance | 15,932 | 15,217 |
Official checks outstanding | 6,254 | 3,852 |
Other liabilities | 36,094 | 35,633 |
Total liabilities | 2,303,524 | 2,190,273 |
Stockholders' Equity | ||
Common stock, $0.01 par value; 150,000,000 shares authorized; 56,245,065 shares issued and 45,381,531 shares outstanding at December 31, 2012; 56,245,065 shares issued and 45,198,765 shares outstanding at June 30, 2012. | 562 | 562 |
Additional paid-in capital | 496,283 | 495,704 |
Unallocated common stock held by the employee stock ownership plan | (26,522) | (27,582) |
Restricted Stock Awards | (15,900) | (19,146) |
Treasury stock, at cost; 10,863,534 shares at December 31, 2012 and 11,046,300 shares at June 30, 2012 | (141,278) | (143,469) |
Retained income | 188,697 | 200,718 |
Accumulated other comprehensive income, net of tax | 4,320 | 3,922 |
Total stockholders' equity | 506,162 | 510,709 |
Total Liabilities and Stockholders' Equity | $ 2,809,686 | $ 2,700,982 |
Oritani Financial Corp. and Subsidiaries | ||||
Township of Washington, New Jersey | ||||
Consolidated Statements of Operations | ||||
Three and Six Months Ended December 31, 2012 and 2011 | ||||
Three months ended | Six months ended | |||
December 31, | December 31, | |||
2012 | 2011 | 2012 | 2011 | |
unaudited | ||||
Interest income: | (in thousands, except per share data) | |||
Mortgage loans | $ 29,079 | $ 26,936 | $ 58,161 | $ 52,865 |
Dividends on FHLB stock | 437 | 281 | 844 | 580 |
Securities available for sale | 58 | 304 | 132 | 686 |
Mortgage-backed securities held to maturity | 225 | 226 | 459 | 475 |
Mortgage-backed securities available for sale | 1,807 | 2,776 | 3,831 | 5,634 |
Federal funds sold and short term investments | 1 | 1 | 2 | 30 |
Total interest income | 31,607 | 30,524 | 63,429 | 60,270 |
Interest expense: | ||||
Deposits | 2,135 | 3,292 | 4,469 | 6,975 |
Borrowings | 5,401 | 5,195 | 10,699 | 10,271 |
Total interest expense | 7,536 | 8,487 | 15,168 | 17,246 |
Net interest income before provision for loan losses | 24,071 | 22,037 | 48,261 | 43,024 |
Provision for loan losses | 1,500 | 2,000 | 3,000 | 5,500 |
Net interest income | 22,571 | 20,037 | 45,261 | 37,524 |
Other income: | ||||
Service charges | 206 | 285 | 450 | 612 |
Real estate operations, net | 256 | 236 | 626 | 586 |
Net (loss) income from investments in real estate joint ventures | (127) | 215 | 12 | 416 |
Bank-owned life insurance | 455 | 400 | 860 | 804 |
Net gain (loss) on sale of assets | 36 | (12) | 44 | 557 |
Net loss on sale of and write down of securities | — | (262) | — | (262) |
Other income | 61 | 58 | 120 | 113 |
Total other income | 887 | 920 | 2,112 | 2,826 |
Other expenses: | ||||
Compensation, payroll taxes and fringe benefits | 6,973 | 6,446 | 13,881 | 12,034 |
Advertising | 90 | 118 | 180 | 270 |
Office occupancy and equipment expense | 700 | 672 | 1,382 | 1,278 |
Data processing service fees | 400 | 360 | 807 | 675 |
Federal insurance premiums | 331 | 329 | 601 | 616 |
Real estate owned operations | 58 | 184 | 110 | 548 |
Other expenses | 954 | 954 | 1,778 | 1,831 |
Total other expenses | 9,506 | 9,063 | 18,739 | 17,252 |
Income before income tax expense | 13,952 | 11,894 | 28,634 | 23,098 |
Income tax expense | 5,206 | 4,268 | 10,677 | 8,137 |
Net income | $ 8,746 | $ 7,626 | $ 17,957 | $ 14,961 |
Income per basic common share | $ 0.21 | $ 0.18 | $ 0.43 | $ 0.33 |
Income per diluted common share | $ 0.20 | $ 0.18 | $ 0.42 | $ 0.32 |
Average Balance Sheet and Yield/Rate Information | ||||||||
For the Three Months Ended (unaudited) | ||||||||
December 31, 2012 | December 31, 2011 | |||||||
Average Outstanding Balance |
Interest Earned/ Paid |
Average Yield/ Rate |
Average Outstanding Balance |
Interest Earned/ Paid |
Average Yield/ Rate |
|||
(Dollars in thousands) | ||||||||
Interest-earning assets: | ||||||||
Loans (1) | $ 2,117,712 | $ 29,079 | 5.49% | $ 1,778,394 | $ 26,936 | 6.06% | ||
Federal Home Loan Bank Stock | 41,836 | 437 | 4.18% | 34,039 | 281 | 3.30% | ||
Securities available for sale | 11,934 | 58 | 1.94% | 52,006 | 304 | 2.34% | ||
Mortgage backed securities held to maturity | 34,869 | 225 | 2.58% | 35,488 | 226 | 2.55% | ||
Mortgage backed securities available for sale | 414,692 | 1,807 | 1.74% | 595,317 | 2,776 | 1.87% | ||
Federal funds sold and short term investments | 1,573 | 1 | 0.25% | 1,675 | 1 | 0.24% | ||
Total interest-earning assets | 2,622,616 | 31,607 | 4.82% | 2,496,919 | 30,524 | 4.89% | ||
Non-interest-earning assets | 133,044 | 107,492 | ||||||
Total assets | $ 2,755,660 | $ 2,604,411 | ||||||
Interest-bearing liabilities: | ||||||||
Savings deposits | 137,876 | 97 | 0.28% | 154,466 | 160 | 0.41% | ||
Money market | 448,852 | 550 | 0.49% | 377,170 | 677 | 0.72% | ||
Checking accounts | 247,570 | 138 | 0.22% | 202,910 | 214 | 0.42% | ||
Time deposits | 520,796 | 1,350 | 1.04% | 644,642 | 2,241 | 1.39% | ||
Total deposits | 1,355,095 | 2,135 | 0.63% | 1,379,188 | 3,292 | 0.95% | ||
Borrowings | 825,163 | 5,401 | 2.62% | 666,710 | 5,195 | 3.12% | ||
Total interest-bearing liabilities | 2,180,258 | 7,536 | 1.38% | 2,045,898 | 8,487 | 1.66% | ||
Non-interest-bearing liabilities | 57,939 | 49,214 | ||||||
Total liabilities | 2,238,197 | 2,095,112 | ||||||
Stockholders' equity | 517,463 | 509,299 | ||||||
Total liabilities and stockholders' equity | $ 2,755,660 | $ 2,604,411 | ||||||
Net interest income | $ 24,071 | $ 22,037 | ||||||
Net interest rate spread (2) | 3.44% | 3.23% | ||||||
Net interest-earning assets (3) | $ 442,358 | $ 451,021 | ||||||
Net interest margin (4) | 3.67% | 3.53% | ||||||
Average of interest-earning assets to interest-bearing liabilities | 120.29% | 122.05% | ||||||
(1) Includes nonaccrual loans. | ||||||||
(2) Net interest rate spread represents the difference between the yield on average interest-earning assets and the cost of average interest-bearing liabilities. | ||||||||
(3) Net interest-earning assets represents total interest-earning assets less total interest-bearing liabilities. | ||||||||
(4) Net interest margin represents net interest income divided by average total interest-earning assets. | ||||||||
Average Balance Sheet and Yield/Rate Information | ||||||||
For the Six Months Ended (unaudited) | ||||||||
December 31, 2012 | December 31, 2011 | |||||||
Average Outstanding Balance |
Interest Earned/ Paid |
Average Yield/ Rate |
Average Outstanding Balance |
Interest Earned/ Paid |
Average Yield/ Rate |
|||
(Dollars in thousands) | ||||||||
Interest-earning assets: | ||||||||
Loans (1) | $ 2,068,595 | $ 58,161 | 5.62% | $ 1,744,180 | $ 52,865 | 6.06% | ||
Federal Home Loan Bank Stock | 40,210 | 844 | 4.20% | 30,933 | 580 | 3.75% | ||
Securities available for sale | 16,056 | 132 | 1.64% | 70,173 | 686 | 1.96% | ||
Mortgage backed securities held to maturity | 35,349 | 459 | 2.60% | 36,269 | 475 | 2.62% | ||
Mortgage backed securities available for sale | 436,818 | 3,831 | 1.75% | 573,512 | 5,634 | 1.96% | ||
Federal funds sold and short term investments | 1,584 | 2 | 0.25% | 20,650 | 30 | 0.29% | ||
Total interest-earning assets | 2,598,612 | 63,429 | 4.88% | 2,475,717 | 60,270 | 4.87% | ||
Non-interest-earning assets | 128,022 | 107,976 | ||||||
Total assets | $ 2,726,634 | $ 2,583,693 | ||||||
Interest-bearing liabilities: | ||||||||
Savings deposits | 137,929 | 195 | 0.28% | 153,931 | 371 | 0.48% | ||
Money market | 446,129 | 1,109 | 0.50% | 383,107 | 1,517 | 0.79% | ||
Checking accounts | 243,894 | 273 | 0.22% | 189,339 | 426 | 0.45% | ||
Time deposits | 536,470 | 2,892 | 1.08% | 656,580 | 4,661 | 1.42% | ||
Total deposits | 1,364,421 | 4,469 | 0.66% | 1,382,957 | 6,975 | 1.01% | ||
Borrowings | 789,192 | 10,699 | 2.71% | 598,923 | 10,271 | 3.43% | ||
Total interest-bearing liabilities | 2,153,613 | 15,168 | 1.41% | 1,981,880 | 17,246 | 1.74% | ||
Non-interest-bearing liabilities | 56,666 | 49,845 | ||||||
Total liabilities | 2,210,279 | 2,031,725 | ||||||
Stockholders' equity | 516,355 | 551,968 | ||||||
Total liabilities and stockholder's equity | $ 2,726,634 | $ 2,583,693 | ||||||
Net interest income | $ 48,261 | $ 43,024 | ||||||
Net interest rate spread (2) | 3.47% | 3.13% | ||||||
Net interest-earning assets (3) | $ 444,999 | $ 493,837 | ||||||
Net interest margin (4) | 3.71% | 3.48% | ||||||
Average of interest-earning assets to interest-bearing liabilities | 120.66% | 124.92% | ||||||
(1) Includes nonaccrual loans. | ||||||||
(2) Net interest rate spread represents the difference between the yield on average interest-earning assets and the cost of average | ||||||||
interest-bearing liabilities. | ||||||||
(3) Net interest-earning assets represents total interest-earning assets less total interest-bearing liabilities. | ||||||||
(4) Net interest margin represents net interest income divided by average total interest-earning assets. |