CHARLESTON, S.C., Oct. 27, 2009 (GLOBE NEWSWIRE) -- First Financial Holdings, Inc. ("First Financial" or the "Company") (Nasdaq:FFCH), the holding company for First Federal Savings and Loan Association of Charleston ("First Federal" or the "Association"), today reported results for its fourth quarter and fiscal year ended September 30, 2009. The net income (loss) for the quarter ended September 30, 2009 was $(1.3) million compared to $6.3 million from the comparative quarter ended September 30, 2008. Basic and diluted earnings (loss) per share available to common shareholders were ($0.19) for the current quarter, compared to $0.54 per basic and diluted per common share for the quarter ended September 30, 2008. Net income for the twelve months ended September 30, 2009 totaled $29.3 million, compared with $22.6 million, for the twelve months ended September 30, 2008. Diluted earnings per common share for the twelve months ended September 30, 2009 was $2.24 compared with $1.94 for the twelve months ended September 30, 2008. Included in the results during this fiscal year was an after-tax extraordinary gain of $28.9 million related to the difference between the purchase price and the acquisition-date fair value of the assets purchased and liabilities assumed in the Federal Deposit Insurance Corporation ("FDIC") assisted acquisition of the former Cape Fear Bank in Wilmington, North Carolina.
President and Chief Executive Officer A. Thomas Hood commented, "We are very pleased with our performance given the impact of the current economic environment. Our core operating metrics remain strong and, during the fourth quarter of 2009, we successfully sold $65.0 million of our common stock in a public offering and completed the conversion of the systems of the former Cape Fear Bank. Additionally, in early October 2009, we opened two new in-store financial service centers in Lowes Foods stores in Wilmington, North Carolina bringing seven day-a-week banking services to that market. We continue to devote significant resources to the monitoring and early recognition of potential problems in our loan portfolio. Consumers in our markets are still experiencing high unemployment and lower home values. While our policy of proactively identifying and managing problem credits resulted in a higher level of non-performing loans as of September 30, 2009, we were encouraged by the improvement in our level of net loan charge-offs during the fourth quarter."
"Compared with the quarter ended June 30, 2009, the net interest margin decreased by 17 basis points from a net interest margin of 4.16% to 3.99% for the quarter ended September 30, 2009. Net interest income for the quarter ended September 30, 2009 was $34.1 million, decreasing from $35.5 million or 4.16% for the linked quarter ended June 30, 2009. Hood commented, "We anticipate the deposits assumed and the loans acquired from the former Cape Fear Bank to have a positive but lessening impact on our net interest margin through fiscal 2010. Lower funding costs also continue to have a positive impact on our net interest margin. Our focus remains on increasing our core deposits and developing long-term customer relationships across our entire footprint."
The Company recognized a provision for loan losses of $21.3 million for the quarter ended September 30, 2009 compared to $12.4 million for the quarter ended June 30, 2009, and $5.2 million for the quarter ended September 30, 2008. The increase in the provision on both a linked and comparative quarter basis is attributable to increased non-performing loans and an ongoing assessment of current economic conditions specific to the markets we serve. The Company increased its allowance for loan losses as a percent of total loans from 205 basis points during the quarter ended June 30, 2009 to 257 basis points during the quarter ended September 30, 2009. Problem assets, which include non-accrual loans, accruing loans more than 90 days past due and real estate owned, as a percentage of total assets were 2.92% at September 30, 2009 compared with 0.84% at September 30, 2008 and 2.20% at June 30, 2009. The Company's loan loss reserve coverage of non-performing loans was 85.0% at September 30, 2009 compared to 116.3% at September 30, 2008 and 82.0% at June 30, 2009. The Company continues to work with borrowers searching for alternatives to mortgage foreclosure.
Mortgage banking income was $2.7 million for the fourth quarter of fiscal 2009, an increase of $1.7 million or 171.0% for the linked quarter ended June 30, 2009 and an increase of $1.9 million or 225.5% for the comparative quarter ended September 30, 2008. This increase is attributed to the Company's strategy of having certain economic hedging strategies in place to protect the value of our capitalized mortgage servicing asset from interest rate risk.
During the quarter ended September 30, 2009, there was further deterioration in our bank trust preferred collateralized debt obligations ("CDOs") portfolio. As a result, the Company recognized a credit-related other than temporary impairment (OTTI) charge totaling $614 thousand on seven CDOs comprised of bank trust preferred securities and one private label collateralized mortgage obligation ("CMO"). Total CDOs comprised of bank trust preferreds is $5.6 million or 1.1% of our total investment portfolio.
Total non-interest revenues were $15.4 million for the fourth quarter of fiscal 2009 compared to $15.1 million for the quarter ended September 30, 2008. Total revenues, defined as net interest income plus total other income, excluding gains on sales of investments and gains on disposition of assets, increased to $49.4 million for the quarter ended September 30, 2009, an increase of $11.1 million, or 29.0%, from $38.3 million during the comparable quarter ended September 30, 2008.
Total non-interest expense increased by $6.7 million, or 28.1%, to $30.6 million for the quarter ended September 30, 2009 compared to $23.9 million for the quarter ended September 30, 2008. Salary and employee benefits costs and occupancy costs increased in the fourth quarter of fiscal 2009 as a result of the acquisition of the operations of the former Cape Fear Bank and American Pensions, Inc. The assets and trade name of American Pensions, Inc., one of South Carolina's largest retirement plan consulting, fiduciary and administration firms, were purchased on July 1, 2009.
Hood continued, "While current market conditions continue to present many challenges for all financial institutions, our Board of Directors, officers and employees are committed to finding the best financial solutions for our customers and the best results for our shareholders. We are very proud of our performance in fiscal 2009 and we welcome the new fiscal year and are committed to achieving our financial and operational goals for fiscal 2010."
The Company also announced today that its Board of Directors has declared a regular quarterly cash dividend of $0.05 per share. The dividend is payable November 27, 2009, to stockholders of record as of November 13, 2009. Hood concluded, "Our board of directors continues to carefully evaluate the level of our dividend. We believe there is a critical need to preserve our strong capital base through these challenging economic times and this conservative approach continues to be the most appropriate action at this time."
As of September 30, 2009, First Financial's total assets were $3.5 billion, loans receivable totaled $2.6 billion and deposits were $2.3 billion. Stockholders' equity was $351.6 million and book value per common share totaled $18.03 at September 30, 2009. First Federal's capital ratio (i.e., equity divided by assets) was 7.92% at September 30, 2009, compared to 7.43% and 6.91% at June 30, 2009 and September 30, 2008, respectively. Tangible equity to assets was 7.67% at September 30, 2009, compared to 7.29% and 7.32% at June 30, 2009 and September 30, 2008, respectively. As of September 30, 2009, First Federal remained categorized "well capitalized" under regulatory standards.
As a participant in the Treasury's Capital Purchase Program, the Company continues to use this capital to help borrowers avoid foreclosures in our markets, and to expand our loan and investment portfolios. The Company paid a dividend of $813 thousand to the U.S. Treasury for its investment during the fourth quarter of fiscal 2009.
On September 29, 2009, the Company raised $65.0 million through a public offering by issuing 4,193,550 shares of common stock at a price of $15.50 per share. Subsequently, on October 9, the Company announced that the underwriters fully exercised their over-allotment option, resulting in the issuance of an additional 629,032 shares. Including the over-allotment option, the net proceeds to the Company after deducting underwriting discounts, commissions and estimated offering expenses are expected to be $69.8 million.
First Financial is the holding company for First Federal Savings and Loan Association of Charleston , which operates 65 offices located in the Charleston metropolitan area, Horry, Georgetown, Florence and Beaufort counties in South Carolina and Brunswick, New Hanover and Pender counties in coastal North Carolina offering banking, trust and pension administration services. The Company also provides insurance and brokerage services through First Southeast Insurance Services, The Kimbrell Insurance Group and First Southeast Investor Services.
NOTE: A. Thomas Hood, President and CEO of the Company, and R. Wayne Hall, Executive Vice President and CFO, will discuss these results in a conference call at 2:00 PM (EDT), October 27, 2009. The call can be accessed via a webcast available on First Financial's website at www.firstfinancialholdings.com.
Forward Looking Statements
Certain matters in this news release constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements relate to, among others, expectations of the business environment in which the Company operates, projections of future performance, including operating efficiencies, perceived opportunities in the market, potential future credit experience, and statements regarding the Company's mission and vision. These forward-looking statements are based upon current management expectations, and may, therefore, involve risks and uncertainties. Management's ability to predict results or the effect of future plans or strategies is inherently uncertain. The Company's actual results, performance or achievements may differ materially from those suggested, expressed or implied by forward-looking statements as a result of a wide range of factors including, but not limited to, the general business environment, general economic conditions nationally and in the States of North and South Carolina, interest rates, the North and South Carolina real estate markets, the demand for mortgage loans, the credit risk of lending activities, including changes in the level of and trend of loan delinquencies and charge-offs, results of examinations by our banking regulators, our ability to successfully integrate any assets, liabilities, customers, systems, and management personnel we have acquired or may in the future acquire into our operations and our ability to realize related revenue synergies and cost savings within expected time frames and any goodwill charges related thereto, competitive conditions between banks and non-bank financial services providers, regulatory changes and other risks detailed in the Company's reports filed with the Securities and Exchange Commission ("SEC"), including the Annual Report on Form 10-K for the fiscal year ended September 30, 2008. Accordingly, these factors should be considered in evaluating the forward-looking statements, and undue reliance should not be placed on these statements.
Such forward-looking statements may include projections. Such projections were not prepared in accordance with published guidelines of the American Institute of Certified Public Accountants or the SEC regarding projections and forecasts nor have such projections been audited, examined or otherwise reviewed by independent auditors of the Company. In addition, such projections are based upon many estimates and inherently subject to significant economic and competitive uncertainties and contingencies, many of which are beyond the control of management of the Company. Accordingly, actual results may be materially higher or lower than those projected. The inclusion of such projections herein should not be regarded as a representation by the Company that the projections will prove to be correct. The Company does not undertake to update any forward-looking statement that may be made on behalf of the Company.
For additional information about First Financial, please visit our web site at www.firstfinancialholdings.com or contact Dorothy B. Wright, Vice President-Investor Relations and Corporate Secretary, (843) 529-5931.
FIRST FINANCIAL HOLDINGS, INC. Unaudited Condensed Consolidated Financial Highlights (in thousands, except share data) Three Months Ended Twelve Months Ended ------------------------------- -------------------- Statements of Income 09/30/09 09/30/08 06/30/09 09/30/09 09/30/08 --------- --------- --------- --------- --------- Interest income $ 49,815 $ 43,398 $ 51,266 $ 188,796 $ 174,772 Interest expense 15,764 19,243 15,727 67,114 83,408 --------- --------- --------- --------- --------- Net interest income 34,051 24,155 35,539 121,682 91,364 Provision for loan losses (21,281) (5,218) (12,367) (66,883) (16,939) --------- --------- --------- --------- --------- Net interest income after provision 12,770 18,937 23,172 54,799 74,425 Other income Net gain on sale of investments and mortgage- backed securities -- -- -- -- 750 Brokerage fees 532 672 383 2,028 2,923 Commissions on insurance 5,595 6,078 6,121 23,315 23,773 Other agency income 323 274 414 1,351 1,057 Impairment on investment securities (614) (486) (377) (3,992) (486) Service charges and fees on deposit accounts 5,865 6,133 5,688 22,501 23,901 Mortgage banking income 2,672 821 986 8,070 7,456 Gains on disposition of assets 37 913 37 162 1,052 Other 981 663 (281) 826 2,475 --------- --------- --------- --------- --------- Total other income 15,391 15,068 12,971 54,261 62,901 Other expenses Salaries and employee benefits 18,227 14,697 15,640 64,666 65,271 Occupancy costs 2,446 2,120 2,215 8,935 8,210 Marketing 586 460 479 2,137 2,408 Furniture and equipment expense 2,277 1,629 2,202 7,546 5,867 Other 7,089 5,002 7,609 25,928 18,573 --------- --------- --------- --------- --------- Total other expenses 30,625 23,908 28,145 109,212 100,329 --------- --------- --------- --------- --------- Income (loss) before income taxes and extraordinary items (2,464) 10,097 7,998 (152) 36,997 Provision for income taxes (1,198) 3,789 2,842 (615) 14,359 --------- --------- --------- --------- --------- Income (loss) before extra- ordinary items (1,266) 6,308 5,156 463 22,638 Extraordinary items Gain on acqui- sition, less income tax of $18,833 -- -- 28,857 28,857 -- --------- --------- --------- --------- --------- Net income (loss) (1,266) 6,308 34,013 29,320 22,638 Preferred stock dividend 813 -- 813 2,663 -- Accretion on preferred stock discount 134 -- 132 431 -- --------- --------- --------- --------- ---------- Net income (loss) avail- able to common shareholders $ (2,213) $ 6,308 $ 33,068 $ 26,226 $ 22,638 ========= ========= ========= ========= ========= Earnings (loss) per share before extra- ordinary items: Basic $ (0.11) $ 0.54 $ 0.44 $ 0.04 $ 1.94 Diluted $ (0.11) $ 0.54 $ 0.44 $ 0.04 $ 1.94 Earnings (loss) per share net income: Basic $ (0.11) $ 0.54 $ 2.91 $ 2.50 $ 1.94 Diluted $ (0.11) $ 0.54 $ 2.91 $ 2.50 $ 1.94 Earnings (loss) per share avail able to common shareholders: Basic $ (0.19) $ 0.54 $ 2.83 $ 2.24 $ 1.94 Diluted $ (0.19) $ 0.54 $ 2.83 $ 2.24 $ 1.94 Average number shares outstanding 11,791 11,683 11,699 11,721 11,664 Average number diluted shares outstanding 11,791 11,688 11,699 11,721 11,692 Ratios: Return on average equity (1) -1.57% 13.59% 7.16% 0.17% 12.16% Return on average assets 1) -0.14% 0.86% 0.57% 0.01% 0.79% Net interest margin 3.99% 3.48% 4.16% 3.79% 3.41% Total other expense / average assets 3.44% 3.24% 3.12% 3.26% 3.50% Efficiency ratio (2) 60.46% 61.36% 56.42% 59.62% 64.33% Net charge- offs / average loans, annualized 1.10% 0.39% 1.43% 1.04% 0.37% (1) Calculated using income before extraordinary items. (2) Excludes from income: gains / (losses) on sales of securities, net real estate operations, gains on disposition of assets, realized impairment on investments, VISA litigation, and extraordinary items. Please Note: Certain prior period amounts have been reclassified to conform to current period presentation. FIRST FINANCIAL HOLDINGS, INC. Unaudited Condensed Consolidated Financial Highlights (in thousands, except share data) Statements of Financial Condition 09/30/09 09/30/08 06/30/09 ----------- ----------- ----------- Assets Cash and cash equivalents $ 78,070 $ 62,949 $ 92,097 Investments 82,298 60,969 85,024 Mortgage-backed securities 478,980 351,110 522,355 Loans receivable, net 2,593,269 2,324,537 2,609,498 Loan held for sale 25,603 8,731 63,311 Office properties, net 81,021 78,796 81,136 Real estate owned 22,002 4,286 12,927 Intangible assets 37,961 36,241 35,779 Mortgage servicing rights 11,166 12,550 10,703 FDIC indemnification receivable, net 62,754 -- 61,541 Other assets 37,163 33,825 32,695 ----------- ----------- ----------- Total Assets $ 3,510,287 $ 2,973,994 $ 3,607,066 =========== =========== =========== Liabilities and Stockholders' Equity Deposits $ 2,303,611 $ 1,851,102 $ 2,341,055 Advances from FHLB 492,751 818,000 492,880 Other borrowings 305,205 75,205 420,204 Other liabilities 57,071 46,209 59,898 ----------- ----------- ----------- Total Liabilities 3,158,638 2,790,516 3,314,037 ----------- ----------- ----------- Stockholders' equity Stockholders' equity 451,279 302,832 394,211 Treasury stock (103,563) (103,387) (103,563) Accumulated other comprehensive income (loss) 3,933 (15,967) 2,381 ----------- ----------- ----------- Total stockholders' equity 351,649 183,478 293,029 ----------- ----------- ----------- Total liabilities and stockholders' equity $ 3,510,287 $ 2,973,994 $ 3,607,066 =========== =========== =========== Stockholders' equity to total assets 10.02% 6.17% 8.12% Common shares outstanding 15,897 11,692 11,699 Book value per common share $ 18.03 $ 15.69 $ 19.49 Tangible book value per common share $ 15.64 $ 12.59 $ 16.43 Credit quality - quarterly results Total reserves for loan losses $ 68,473 $ 23,990 $ 54,499 Loan loss reserves / loans 2.57% 1.02% 2.05% Reserves/non-performing loans 85.00% 116.27% 82.01% Provision for losses $ 21,281 $ 5,218 $ 12,367 Net loan charge-offs $ 7,307 $ 2,251 $ 9,490 Problem assets Non-accrual loans $ 80,432 $ 20,557 $ 66,300 Accruing loans 90 days or more past due 121 76 153 REO through foreclosure 22,002 4,286 12,927 ----------- ----------- ----------- Total $ 102,555 $ 24,919 $ 79,380 As a percent of total assets 2.92% 0.84% 2.20% First Financial Holdings, Inc. As of the Quarter Ended (Unaudited) (dollars in thousands) BALANCE SHEET 09/30/09 06/30/09 03/31/09 12/31/08 09/30/08 ---------- ---------- ---------- ---------- ---------- Assets Cash and invest- ments $ 160,368 $ 177,121 $ 118,555 $ 119,919 $ 123,918 Loans re- ceivable, net 2,593,269 2,609,498 2,333,846 2,334,254 2,324,537 Loans held for sale 25,603 63,311 48,319 11,804 8,731 Mortgage -backed securities 478,980 522,355 538,402 403,797 351,110 Office properties and equip. 81,021 81,136 81,751 82,322 78,796 Real estate owned 22,002 12,927 6,312 5,346 4,286 FDIC indemnif- ication, net 62,754 61,541 -- -- -- Other assets 86,290 79,177 79,354 79,852 82,616 ---------- ---------- ---------- ---------- ---------- Total assets $3,510,287 $3,607,066 $3,206,539 $3,037,294 $2,973,994 ========== ========== ========== ========== ========== Liabilities Deposits $2,303,611 $2,341,055 $1,995,057 $1,926,625 $1,851,102 Advances- FHLB 492,751 492,880 609,000 746,000 818,000 Other borrowed money 305,205 420,204 310,204 125,204 75,205 Other liabil- ities 57,071 59,898 38,043 19,387 46,209 ---------- ---------- ---------- ---------- ---------- Total liabil- ities 3,158,638 3,314,037 2,952,304 2,817,216 2,790,516 ---------- ---------- ---------- ---------- ---------- Total stock- holders' equity 351,649 293,029 254,235 220,078 183,478 ---------- ---------- ---------- ---------- ---------- Total liabil- ities and stock- holders' equity $3,510,287 $3,607,066 $3,206,539 $3,037,294 $2,973,994 ========== ========== ========== ========== ========== Total shares o/s 15,897 11,699 11,699 11,697 11,692 Book value per share $ 18.03 $ 19.49 $ 16.18 $ 13.26 $ 15.69 Equity /assets 10.02% 8.12% 7.93% 7.25% 6.17% AVERAGE BALANCES Total assets $3,558,677 $3,613,406 $3,121,916 $3,005,644 $2,949,011 Earning assets 3,382,326 3,427,813 3,004,582 2,867,614 2,763,247 Gross Loans 2,662,870 2,661,990 2,418,595 2,368,767 2,314,352 Costing liabil- ities 3,262,178 3,232,640 2,950,628 2,807,944 2,730,439 Deposits 2,419,451 2,168,056 2,031,280 1,931,978 1,875,748 Equity 322,339 288,061 237,157 201,778 185,728 BALANCE SHEET 06/30/08 03/31/08 12/31/07 09/30/07 ---------- ---------- ---------- ---------- Assets Cash and investments $ 134,495 $ 142,360 $ 137,844 $ 132,961 Loans receivable, net 2,263,965 2,218,027 2,184,611 2,134,458 Loans held for sale 4,519 14,031 10,361 6,311 Mortgage-backed securities 353,257 370,848 345,397 297,011 Office properties and equip. 77,732 76,766 74,850 74,361 Real estate owned 5,442 4,310 2,748 4,841 FDIC indemnification, net -- -- -- -- Other assets 84,618 62,162 61,896 61,425 ---------- ---------- ---------- ---------- Total assets $2,924,028 $2,888,504 $2,817,707 $2,711,368 ========== ========== ========== ========== Liabilities Deposits $1,865,261 $1,875,099 $1,806,585 $1,854,051 Advances-FHLB 747,000 719,000 708,000 554,000 Other borrowed money 69,204 52,204 52,206 52,207 Other liabilities 54,585 55,609 63,650 65,432 ---------- ---------- ---------- ---------- Total liabilities 2,736,050 2,701,912 2,630,441 2,525,690 ---------- ---------- ---------- ---------- Total stockholders' equity 187,978 186,592 187,266 185,678 ---------- ---------- ---------- ---------- Total liabilities and stockholders' equity $2,924,028 $2,888,504 $2,817,707 $2,711,368 ========== ========== ========== ========== Total shares o/s 11,674 11,663 11,657 11,635 Book value per share $ 16.10 $ 16.00 $ 16.07 $ 15.96 Equity/assets 6.43% 6.46% 6.65% 6.85% AVERAGE BALANCES Total assets $2,906,266 $2,853,106 $2,764,539 $2,691,152 Earning assets 2,714,252 2,655,387 2,584,426 2,476,732 Gross Loans 2,269,463 2,227,139 2,189,044 2,142,475 Costing liabilities 2,671,260 2,612,019 2,523,927 2,432,008 Deposits 1,884,688 1,841,855 1,841,414 1,874,849 Equity 187,302 186,961 186,506 187,237 First Financial Holdings, Inc. (dollars in thousands) Quarter Ended (Unaudited) ---------------------------------------------------------- 09/30/09 06/30/09 03/31/09 12/31/08 09/30/08 06/30/08 -------- -------- -------- -------- -------- -------- STATEMENT OF OPERATIONS Total interest income $ 49,815 $ 51,266 $ 43,731 $ 43,984 $ 43,398 $ 43,219 Total interest expense 15,764 15,727 16,770 18,853 19,243 19,209 -------- -------- -------- -------- -------- -------- Net interest income 34,051 35,539 26,961 25,131 24,155 24,010 Provision for loan losses (21,281) (12,367) (12,765) (20,471) (5,218) (4,907) -------- -------- -------- -------- -------- -------- Net int. inc. after provision 12,770 23,172 14,196 4,660 18,937 19,103 -------- -------- -------- -------- -------- -------- Other income Gain on investment securities 4 Brokerage fees 532 383 632 480 672 665 Commissions on insurance 5,595 6,121 6,656 4,942 6,078 7,126 Other agency income 323 414 310 303 274 294 Impairment on investment securities (614) (377) (857) (2,144) (486) Svc. chgs/ fees-dep. accts 5,865 5,688 5,280 5,669 6,133 5,911 Mortgage banking income 2,672 986 2,652 1,760 821 1,826 Gains (losses) on dispo- sition of properties 37 37 36 52 913 43 Other 981 (281) (69) 197 663 375 -------- -------- -------- -------- -------- -------- Total other income 15,391 12,971 14,640 11,259 15,068 16,244 -------- -------- -------- -------- -------- -------- Other expenses Salaries & employee benefits 18,227 15,640 13,636 17,162 14,697 16,603 Occupancy costs 2,446 2,215 2,129 2,145 2,120 2,037 Marketing 586 479 422 650 460 685 Furniture and equipment expense 2,277 2,202 1,572 1,684 1,629 1,438 Other 7,089 7,609 6,086 4,955 5,002 4,809 -------- -------- -------- -------- -------- -------- Total other expenses 30,625 28,145 23,845 26,596 23,908 25,572 -------- -------- -------- -------- -------- -------- Income (loss) before taxes (2,464) 7,998 4,991 (10,677) 10,097 9,775 Provision for income taxes (1,198) 2,842 1,872 (4,130) 3,789 3,873 -------- -------- -------- -------- -------- -------- Income before extra- ordinary items (1,266) 5,156 3,119 (6,547) $ 6,308 $ 5,902 ======== ======== ======== ======== ======== ======== Extra- ordinary items Gain on acqui- sition, less income tax of $18,833 28,857 Net Income (1,266) 34,013 3,119 (6,547) 6,308 5,902 Preferred stock dividend 813 813 813 225 Accretion on preferred stock discount 134 132 130 36 -------- -------- -------- -------- -------- -------- Net Income (loss) available to common share- holders $ (2,213) $ 33,068 $ 2,176 $ (6,808) $ 6,308 $ 5,902 ======== ======== ======== ======== ======== ======== Note: Certain prior period amounts have been reclassified to conform to current period presentation. Average shares o/s, basic 11,791 11,699 11,699 11,694 11,683 11,668 Average shares o/s, diluted 11,791 11,699 11,699 11,694 11,688 11,679 Earnings per share before extra- ordinary items -basic $ (0.11) $ 0.44 $ 0.27 $ (0.58) $ 0.54 $ 0.51 Earnings per share before extra- ordinary items -diluted $ (0.11) $ 0.44 $ 0.27 $ (0.58) $ 0.54 $ 0.51 Earnings per share Net Income -basic $ (0.11) $ 2.91 $ 0.27 $ (0.58) $ 0.54 $ 0.51 Earnings per share Net Income -diluted $ (0.11) $ 2.91 $ 0.27 $ (0.58) $ 0.54 $ 0.51 Earnings per share Available to common share- holders - basic $ (0.19) $ 2.83 $ 0.19 $ (0.58) $ 0.54 $ 0.51 Earnings per share Available to common share- holders - diluted $ (0.19) $ 2.83 $ 0.19 $ (0.58) $ 0.54 $ 0.51 Dividends paid per share, author- ized $ 0.05 $ 0.05 $ 0.05 $ 0.255 $ 0.255 $ 0.255 Quarter Ended (Unaudited) Fiscal Year ---------------------------- ---------------------------- 03/31/08 12/31/07 09/30/07 09/30/09 09/30/08 09/30/07 -------- -------- -------- -------- -------- -------- STATEMENT OF OPERATIONS Total interest income $ 43,801 $ 44,355 $ 42,916 $188,796 $174,772 $168,000 Total interest expense 21,660 23,295 22,225 67,114 83,408 85,173 -------- -------- -------- -------- -------- -------- Net interest income 22,141 21,060 20,691 121,682 91,364 82,827 Provision for loan losses (3,567) (3,248) (1,850) (66,883) (16,939) (5,164) -------- -------- -------- -------- -------- -------- Net int. inc. after provision 18,574 17,812 18,841 54,799 74,425 77,663 -------- -------- -------- -------- -------- -------- Other income Gain on investment securities 645 100 -- 750 266 Brokerage fees 906 680 665 2,028 2,923 2,551 Commissions on insurance 6,532 4,037 4,883 23,315 23,773 20,865 Other agency income 239 250 288 1,351 1,057 1,181 Impairment on investment securities (3,992) (486) Svc. chgs/ fees-dep. accts 5,780 6,077 5,818 22,501 23,901 21,566 Mortgage banking income 2,961 1,849 922 8,070 7,456 4,255 Gains (losses) on dispo- sition of properties 59 36 40 162 1,052 230 Other 738 700 775 826 2,475 2,370 -------- -------- -------- -------- -------- -------- Total other income 17,860 13,729 13,391 54,261 62,901 53,284 -------- -------- -------- -------- -------- -------- Other expenses Salaries & employee benefits 15,965 18,007 14,167 64,666 65,271 58,647 Occupancy costs 2,001 2,053 1,828 8,935 8,210 6,709 Marketing 570 694 522 2,137 2,408 2,262 Furniture and equipment expense 1,374 1,426 1,516 7,546 5,867 5,404 Other 4,211 4,549 4,804 25,928 18,573 17,478 -------- -------- -------- -------- --------- -------- Total other expenses 24,121 26,729 22,837 109,212 100,329 90,500 -------- -------- -------- -------- -------- -------- Income (loss) before taxes 12,313 4,812 9,395 (152) 36,997 40,447 Provision for income taxes 4,783 1,915 4,204 (615) 14,359 15,375 -------- -------- -------- -------- -------- -------- Income before extra- ordinary items $ 7,530 $ 2,897 $ 5,191 $ 463 $ 22,638 $ 25,072 ======== ======== ======== ======== ======== ======== Extra- ordinary items Gain on acqui- sition, less income tax of $18,833 28,857 Net Income 7,530 2,897 5,191 29,320 22,638 25,072 Preferred stock dividend 2,663 Accretion on preferred stock discount 441 -------- -------- -------- -------- -------- -------- Net Income (loss) available to common share- holders $ 7,530 $ 2,897 $ 5,191 $ 26,216 $ 22,638 $ 25,072 ======== ======== ======== ======== ======== ======== Note: Certain prior period amounts have been reclassified to conform to current period presentation. Average shares o/s, basic 11,659 11,646 11,741 11,721 11,664 11,929 Average shares o/s, diluted 11,675 11,727 11,842 11,721 11,692 12,089 Earnings per share before extra- ordinary items -basic $ 0.65 $ 0.25 $ 0.44 $ 0.04 $ 1.94 $ 2.10 Earnings per share before extra- ordinary items -diluted $ 0.64 $ 0.25 $ 0.44 $ 0.04 $ 1.94 $ 2.07 Earnings per share Net Income -basic $ 0.65 $ 0.25 $ 0.44 $ 2.50 $ 1.94 $ 2.10 Earnings per share Net Income -diluted $ 0.64 $ 0.25 $ 0.44 $ 2.50 $ 1.94 $ 2.07 Earnings per share Available to common share- holders - basic $ 0.65 $ 0.25 $ 0.44 $ 2.24 $ 1.94 $ 2.10 Earnings per share Available to common share- holders - diluted $ 0.64 $ 0.25 $ 0.44 $ 2.24 $ 1.94 $ 2.07 Dividends paid per share, author- ized $ 0.255 $ 0.255 $ 0.25 $ 0.41 $ 1.02 $ 1.00 First Financial Holdings, Inc. (dollars in thousands) Quarter Ended (unaudited) ---------------------------------------------------------- 09/30/09 06/30/09 03/31/09 12/31/08 09/30/08 ---------- ---------- ---------- ---------- ---------- OTHER RATIOS Return on Average Assets -0.14% 0.57% 0.40% -0.87% 0.86% Return on Average Equity -1.57% 7.16% 5.26% -12.98% 13.59% Average yield on earning assets 5.84% 6.00% 5.90% 6.08% 6.24% Average cost of paying liabil- ities 1.90% 1.94% 2.29% 2.64% 2.80% Gross spread 3.94% 4.06% 3.61% 3.44% 3.44% Net interest margin 3.99% 4.16% 3.64% 3.48% 3.48% Operating exp./avg. assets 3.44% 3.12% 3.06% 3.54% 3.24% Efficiency ratio 60.46% 56.42% 55.74% 68.20% 61.36% Note: Average yields, costs and margins for prior periods adjusted to actual days COMPOSITION OF GROSS LOAN PORTFOLIO Mortgage Loans (1-4 Family) $ 949,518 $ 929,706 $ 882,511 $ 882,857 $ 886,488 Constr- uction Loans (1-4 Family) 41,133 56,788 56,438 67,980 70,396 Commercial Real Estate 435,298 342,349 322,663 314,516 307,903 Commercial Constr- uction 53,219 47,445 41,490 39,380 40,827 Commercial Business Loans 96,559 196,307 93,024 95,638 89,764 Land - Resident- ial 169,367 187,797 143,329 145,757 146,694 Land - Commer- cial 130,763 118,940 107,774 106,956 101,168 Home Equity Lines of Credit 394,075 394,960 356,281 344,526 325,354 Mobile Home Loans 244,214 238,549 232,515 227,698 223,476 Credit Cards 17,483 16,949 16,128 16,790 16,125 Marine 76,748 77,819 77,836 79,901 83,464 Other Consumer Loans 53,365 56,388 51,347 53,783 56,869 ---------- ---------- ---------- ---------- ---------- 2,661,742 2,663,997 2,381,336 2,375,782 2,348,528 Less: Allowance for Loan Losses 68,473 54,499 47,490 41,528 23,990 ---------- ---------- ---------- ---------- ---------- Total $2,593,269 $2,609,498 $2,333,846 $2,334,254 $2,324,537 ========== ========== ========== ========== ========== Loans Held for Sale $ 25,603 $ 63,311 $ 48,319 $ 11,804 $ 8,731 ========== ========== ========== ========== ========== Note: The Composition of Gross Loans has been changed to collateral type consistent with 10Qs as filed with the SEC. COMPOSITION OF DEPOSITS Checking $ 527,795 $ 543,232 $ 500,750 $ 461,179 $ 474,301 Passbook 154,342 145,541 137,853 126,261 129,466 Money Market 344,220 341,209 296,427 303,866 345,327 ---------- ---------- ---------- ---------- ---------- Core Deposits 1,026,357 1,029,982 935,030 891,306 949,094 Time Deposits 1,277,254 1,311,073 1,060,027 1,035,318 902,008 ---------- ---------- ---------- ---------- ---------- TOTAL DEPOSITS $2,303,611 $2,341,055 $1,995,057 $1,926,624 $1,851,102 ========== ========== ========== ========== ========== ASSET QUALITY Non- accrual loans $ 80,432 $ 66,300 $ 54,769 $ 35,070 $ 20,557 Loans 90 days or more past due 121 153 86 116 76 REO thru fore- closure 22,002 12,927 6,312 5,346 4,286 ---------- ---------- ---------- ---------- ---------- $ 102,555 $ 79,380 $ 61,167 $ 40,532 $ 24,919 ========== ========== ========== ========== ========== LOAN AND REO LOSS RESERVES Total reserves for loan losses $ 68,473 $ 54,499 $ 47,490 $ 41,528 $ 23,990 Loan loss reserves/ loans 2.57% 2.05% 1.99% 1.74% 1.02% Provision for losses 21,281 12,367 12,765 20,471 5,218 Net loan charge- offs 7,307 9,490 6,803 2,933 2,251 Net charge -offs/avg gross loans 0.27% 0.36% 0.28% 0.12% 0.10% Annualized net charge -offs/avg gross loans 1.10% 1.43% 1.13% 0.49% 0.39% Quarter Ended (unaudited) ---------------------------------------------- 06/30/08 03/31/08 12/31/07 09/30/07 ---------- ---------- ---------- ---------- OTHER RATIOS Return on Average Assets 0.81% 1.06% 0.42% 0.77% Return on Average Equity 12.60% 16.11% 6.21% 11.09% Average yield on earning assets 6.40% 6.63% 6.81% 6.89% Average cost of paying liabilities 2.89% 3.34% 3.67% 3.65% Gross spread 3.51% 3.29% 3.14% 3.24% Net interest margin 3.56% 3.35% 3.23% 3.31% Operating exp./avg. assets 3.54% 3.37% 3.86% 3.48% Efficiency ratio 63.47% 61.39% 71.10% 66.77% Note: Average yields, costs and margins for prior periods adjusted to actual days COMPOSITION OF GROSS LOAN PORTFOLIO Mortgage Loans (1-4 Family) $ 874,216 $ 871,774 $ 870,122 $ 896,404 Construction Loans (1-4 Family) 73,064 75,590 76,169 50,035 Commercial Real Estate 291,712 286,316 278,948 253,621 Commercial Construction 36,791 31,142 27,274 25,614 Commercial Business Loans 90,070 85,797 83,831 82,843 Land - Residential 145,213 141,355 137,270 137,393 Land - Commercial 98,182 94,241 91,964 80,432 Home Equity Lines of Credit 301,184 284,696 273,399 267,736 Mobile Home Loans 218,312 211,657 206,909 200,967 Credit Cards 15,824 15,638 16,198 14,775 Marine 83,964 81,170 81,466 83,182 Other Consumer Loans 56,499 56,561 57,753 56,892 ---------- ---------- ---------- ---------- 2,285,031 2,235,937 2,201,303 2,149,894 Less: Allowance for Loan Losses 21,066 17,910 16,692 15,436 ---------- ---------- ---------- ---------- Total $2,263,965 $2,218,027 $2,184,611 $2,134,458 ========== ========== ========== ========== Loans Held for Sale $ 4,519 $ 14,031 $ 10,361 $ 6,311 ========== ========== ========== ========== Note: The Composition of Gross Loans has been changed to collateral type consistent with 10Qs as filed with the SEC. COMPOSITION OF DEPOSITS Checking $ 488,595 $ 483,472 $ 459,457 $ 456,045 Passbook 133,414 130,863 127,694 133,201 Money Market 372,617 379,380 364,639 381,040 ---------- ---------- ---------- ---------- Core Deposits 994,626 993,715 951,790 970,286 Time Deposits 870,635 881,384 854,795 883,765 ---------- ---------- ---------- ---------- TOTAL DEPOSITS $1,865,261 $1,875,099 $1,806,585 $1,854,051 ========== ========== ========== ========== ASSET QUALITY Non-accrual loans $ 16,562 $ 12,800 $ 10,133 $ 6,087 Loans 90 days or more past due 79 99 68 49 REO thru foreclosure 5,442 4,310 2,748 1,513 ---------- ---------- ---------- ---------- $ 22,083 $ 17,209 $ 12,949 $ 7,649 ========== ========== ========== ========== LOAN AND REO LOSS RESERVES Total reserves for loan losses $ 21,023 $ 17,901 $ 16,692 $ 15,428 Loan loss reserves/ loans 0.92% 0.80% 0.76% 0.72% Provision for losses 4,907 3,567 3,248 1,850 Net loan charge-offs 1,785 2,358 1,983 1,610 Net charge-offs/avg gross loans 0.08% 0.11% 0.09% 0.08% Annualized net charge-offs/avg gross loans 0.32% 0.43% 0.36% 0.30% Fiscal Year ---------------------------------- 09/30/09 09/30/08 09/30/07 ---------- ---------- ---------- OTHER RATIOS Return on Average Assets 0.01% 0.79% 0.94% Return on Average Equity 0.17% 12.16% 13.99% Average yield on earning assets 5.90% 6.53% 6.82% Average cost of paying liabilities 2.21% 3.17% 3.53% Gross spread 3.69% 3.36% 3.29% Net interest margin 3.79% 3.41% 3.36% Operating exp./avg. assets 3.26% 3.50% 3.38% Efficiency ratio 59.62% 64.33% 67.16% Note: Average yields, costs and margins for prior periods adjusted to actual days First Financial Holdings, Inc. (dollars in thousands) Quarter Ended (unaudited) ------------------- 09/30/09 06/30/09 -------- -------- COMPOSITION OF LOAN LOSSES (NET CHARGE OFFS) Mortgage Loans (1-4 Family) $ 943 $ 232 Construction Loans (1-4 Family) 569 2,005 Commercial Real Estate 166 35 Commercial Construction -- -- Commercial Business Loans 654 946 Land - Residential 955 2,282 Land - Commercial 546 1,313 Home Equity Lines of Credit 1,549 1,153 Mobile Home Loans 866 609 Credit Cards 228 214 Marine Loans 377 383 Other Consumer Loans 454 318 -------- -------- $ 7,307 $ 9,490 ======== ======== ------------------- 09/30/09 06/30/09 -------- -------- COMPOSITION OF DELINQUENT LOANS Mortgage Loans (1-4 Family) $ 33,423 $ 34,520 Construction Loans (1-4 Family) 5,110 7,785 Commercial Real Estate 11,045 6,076 Commercial Construction 2,284 2,265 Commercial Business Loans 1,264 1,922 Land - Residential 24,830 16,199 Land - Commercial 22,850 13,747 Home Equity Lines of Credit 7,697 9,748 Mobile Home Loans 5,411 5,200 Credit Cards 224 377 Marine Loans 892 1,161 Other Consumer Loans 935 829 -------- -------- $115,965 $ 99,829 ======== ======== Rate ------------------- 09/30/09 06/30/09 -------- -------- % OF DELINQUENT LOANS TO GROSS LOAN BALANCE Mortgage Loans (1-4 Family) 3.52% 3.71% Construction Loans (1-4 Family) 12.42% 13.71% Commercial Real Estate 2.54% 1.77% Commercial Construction 4.29% 4.77% Commercial Business Loans 1.31% 0.98% Land - Residential 14.66% 8.63% Land - Commercial 17.47% 11.56% Home Equity Lines of Credit 1.95% 2.47% Mobile Home Loans 2.22% 2.18% Credit Cards 1.28% 2.22% Marine Loans 1.16% 1.49% Other Consumer Loans 1.75% 1.47% -------- -------- 4.36% 3.75% ======== ========