Northwest Bancshares, Inc. Announces Quarterly Earnings and Dividend Declaration

Mon Apr 23, 2012 11:08am EDT

* Reuters is not responsible for the content in this press release.

Northwest Bancshares, Inc. Announces Quarterly Earnings and Dividend Declaration

PR Newswire

WARREN, Pa., April 23, 2012 /PRNewswire/ -- Northwest Bancshares, Inc. (NasdaqGS: NWBI) announced net income for the quarter ended March 31, 2012 of $15.2 million, or $0.16 per diluted share.  This represents a decrease of $2.1 million, or 12.0%, compared to the same quarter last year when net income was $17.3 million, or $0.16 per diluted share, and unchanged compared to the quarter ended December 31, 2011 when net income was also $15.2 million, or $0.16 per diluted share.  The annualized returns on average shareholders' equity and average assets for the current quarter were 5.29% and 0.76% compared to 5.39% and 0.86% for the same quarter last year and 5.23% and 0.76% for the quarter ended December 31, 2011. 

The Company also announced that its Board of Directors declared a quarterly cash dividend of $0.12 per share payable on May 17, 2012, to shareholders of record as of May 3, 2012.  This represents the 70th consecutive quarter in which the Company has paid a cash dividend. 

In making this announcement, William J. Wagner, President and CEO, noted, "Although Northwest's earnings for the most recent quarter remain flat from the previous quarter and lower than a year ago, there are many positive trends to report.  We experienced net loan growth of $56 million with commercial and commercial real estate loans increasing by $61 million, or 3.3%.  Asset quality experienced the most significant improvement in many years as loans delinquent 60 days or more decreased nearly $17 million, or 14.3% during the quarter and are down $37 million, or 27.1% from a year ago.  Despite this improvement in credit quality, our provision for loan losses decreased only $1 million, or 13.2% from the same quarter last year as we remain cautious about the sustainability of the economic recovery.  Given the recent trading ranges for our common stock, we did not repurchase shares this quarter as we continue to be opportunistic with our buyback program.  Finally, we continue to address the various provisions of the FDIC's Consent Order, all of which relate to consumer compliance, in an effort to be released from this oversight as soon as possible."

Net interest income decreased by $1.6 million, or 2.4%, to $65.4 million for the quarter ended March 31, 2012, from $67.0 million for the quarter ended March 31, 2011, which was primarily attributable to decreases in interest income from loans of $2.3 million, or 2.9%, and from investment securities of $2.5 million, or 24.6%.  Partially offsetting this decrease was a $3.1 million, or 19.4% decrease in interest expense on deposit accounts. These changes from the previous year were primarily due to decreases in market interest rates.

The provision for loan losses decreased by $957,000, or 13.2%, to $6.3 million for the quarter ended March 31, 2012, from $7.2 million for the quarter ended March 31, 2011.  As of March 31, 2012, the allowance for loan losses was $72.9 million, or 1.30% of total loans, compared to $76.5 million, or 1.39% of total loans, as of March 31, 2011.  Net charge-offs for the quarter ended March 31, 2012 were $4.5 million, or 0.32% of average loans on an annualized basis, compared to $7.2 million, or 0.52% of average loans on an annualized basis, in the previous year. Nonperforming loans decreased $31.1 million, or 19.9%, and the ratio of nonperforming assets to total assets decreased to 1.91% from 2.16% when compared to last year.

Noninterest income decreased by $686,000, or 4.8%, to $13.6 million for the quarter ended March 31, 2012, from $14.3 million in the prior year due primarily to an increase in the loss on real estate owned of $1.0 million.  Our inventory of foreclosed properties, currently valued at $28.9 million, continues to be actively managed and this increase resulted both from losses on the sale of properties and write-downs on some of the remaining properties.

Noninterest expense increased by $1.9 million, or 3.8%, to $51.3 million for the quarter ended March 31, 2012, from $49.4 million in the prior year period due primarily to an increase in compensation and employee benefits expense of $2.3 million, or 9.2%.  This increase is the result of the adding employees, primarily in the areas of commercial lending, loan servicing, credit review and regulatory compliance and increases in pension expense and health insurance expense. 

Headquartered in Warren, Pennsylvania, Northwest Bancshares, Inc. is the holding company of Northwest Savings Bank.  Founded in 1896, Northwest Savings Bank is a full-service financial institution offering a complete line of business and personal banking products as well as benefits and wealth management services. Northwest operates 168 community banking offices in Pennsylvania, New York, Ohio and Maryland and 52 consumer finance offices in Pennsylvania through its subsidiary, Northwest Consumer Discount Company.  Northwest Bancshares, Inc.'s common stock is listed on the NASDAQ Global Select Market.  Additional information regarding Northwest Bancshares, Inc. can be accessed on-line at www.northwestsavingsbank.com

Forward-Looking Statements - This press release may contain forward-looking statements with respect to the financial condition and results of operations of Northwest Bancshares, Inc. including, without limitations, statements relating to the earnings outlook of the Company and the FDIC Consent Order. These forward-looking statements involve certain risks and uncertainties. Factors that may cause actual results to differ materially from those contemplated by such forward-looking statements, include among others, the following possibilities: (1) changes in the interest rate environment; (2) competitive pressure among financial services companies; (3) general economic conditions including an increase in non-performing loans that could result from an economic downturn; (4) changes in legislation or regulatory requirements; (5) difficulties in continuing to improve operating efficiencies; (6) difficulties in the integration of acquired businesses; and (7) increased risk associated with an increase in commercial real-estate and business loans and non-performing loans.  Management has no obligation to revise or update these forward-looking statements to reflect events or circumstances that arise after the date of this release. 

 

Northwest Bancshares, Inc. and Subsidiaries

Consolidated Statements of Financial Condition

(Dollars in thousands, except per share amounts)









(Unaudited)











March 31,


December 31,

Assets


2012


2011

Cash and cash equivalents




$                     85,050


94,276

Interest-earning deposits in other financial institutions


672,887


593,388

Federal funds sold and other short-term investments


952


633

Marketable securities available-for-sale (amortized cost of $894,232 and $885,408)

919,578


908,349

Marketable securities held-to-maturity (fair value of $224,630 and $239,412)


216,956


231,389


Total cash, interest-earning deposits and marketable securities


1,895,423


1,828,035












Loans held for sale






14,222


967

Residential mortgage loans




2,412,711


2,396,399

Home equity loans 






1,058,938


1,084,786

Other consumer loans





237,591


245,689

Commercial real estate loans



1,475,576


1,435,767

Commercial loans






408,894


387,911


Total loans receivable




5,607,932


5,551,519

Allowance for loan losses




(72,941)


(71,138)


Loans receivable, net




5,534,991


5,480,381












Federal Home Loan Bank stock, at cost



47,090


48,935

Accrued interest receivable




25,072


24,599

Real estate owned, net





28,895


26,887

Premises and Equipment, net



133,599


132,152

Bank owned life insurance




134,615


133,524

Goodwill






171,882


171,882

Other intangible assets





1,828


2,123

Other assets






95,613


109,187


Total assets






$                8,069,008


7,957,705












Liabilities and Shareholders' equity





Liabilities




Noninterest-bearing demand deposits



$                   732,361


658,560

Interest-bearing demand deposits



833,342


800,676

Savings deposits






2,124,269


2,036,272

Time deposits






2,179,789


2,284,817


Total deposits






5,869,761


5,780,325

Borrowed funds






836,410


827,925

Advances by borrowers for taxes and insurance


27,683


23,571

Accrued interest payable




1,119


1,104

Other liabilities






68,466


66,782

Junior subordinated debentures



103,094


103,094


Total liabilities






6,906,533


6,802,801












Shareholders' equity




Preferred stock, $0.01 par value, 50,000,000 shares authorized, no shares issued

-


-

Common stock, $0.01 par value: 500,000,000 shares authorized, 97,593,396 shares




  and 97,493,046 shares issued, respectively


976


975

Paid-in-capital






660,933


659,523

Retained earnings






547,352


543,598

Unallocated common stock of Employee Stock Ownership Plan


(25,568)


(25,966)

Accumulated other comprehensive loss



(21,218)


(23,226)


Total shareholders' equity



1,162,475


1,154,904


Total liabilities and shareholders' equity


$                8,069,008


7,957,705














Equity to assets


14.41%


14.51%



Tangible common equity to assets


12.52%


12.60%



Book value per share


$                       11.91


$                         11.85



Tangible book value per share


$                       10.13


$                         10.06



Closing market price per share


$                       12.70


$                         12.44



Full time equivalent employees


1,975


1,950



Number of banking offices


168


168

 

Northwest Bancshares, Inc. and Subsidiaries

Consolidated Statements of Income - Unaudited 

(Dollars in thousands, except per share amounts)
















Three months ended






March 31,


December 31,






2012


2011


2011

Interest income:








Loans receivable


$                    78,159


80,457


79,930


Mortgage-backed securities


4,691


6,756


5,077


Taxable investment securities


573


398


776


Tax-free investment securities


2,446


3,074


2,600


Interest-earning deposits


380


407


423



Total interest income


86,249


91,092


88,806











Interest expense:








Deposits


12,944


16,063


14,227


Borrowed funds


7,899


7,989


8,041



Total interest expense


20,843


24,052


22,268













Net interest income


65,406


67,040


66,538

Provision for loan losses


6,287


7,244


10,502



Net interest income after provision









for loan losses


59,119


59,796


56,036











Noninterest income:








Impairment losses on securities


(545)


-


(1,504)


Noncredit related losses on securities not expected









to be sold (recognized in other comprehensive income)


307


-


1,074


Net impairment losses


(238)


-


(430)


Gain on sale of investments, net


44


4


157


Service charges and fees


8,425


8,928


8,630


Trust and other financial services income


2,116


1,910


1,967


Insurance commission income


1,718


1,380


1,582


Loss on real estate owned, net


(1,070)


(27)


(466)


Income from bank owned life insurance


1,117


1,166


1,199


Mortgage banking income/ (loss0


531


197


(29)


Other operating income


997


768


1,428



Total noninterest income


13,640


14,326


14,038











Noninterest expense:








Compensation and employee benefits


27,838


25,499


25,434


Premises and occupancy costs


5,748


6,191


5,556


Office operations


3,324


3,100


3,286


Processing expenses


6,142


5,767


5,982


Marketing expenses


2,036


1,959


3,098


Federal deposit insurance premiums


1,620


2,427


933


Professional services


1,697


1,256


1,441


Amortization of intangible assets


295


491


374


Real estate owned expense


740


431


462


Other expense


1,836


2,257


1,870



Total noninterest expense


51,276


49,378


48,436













Income before income taxes


21,483


24,744


21,638


Income tax expense


6,302


7,491


6,463














Net income


$                    15,181


17,253


15,175











Basic earnings per share


$                        0.16


0.16


0.16











Diluted earnings per share


$                        0.16


0.16


0.16











Annualized return on average shareholders' equity


5.29%


5.39%


5.23%

Annualized return on average assets


0.76%


0.86%


0.76%











Basic common shares outstanding


94,115,522


106,571,262


93,675,589

Diluted common shares outstanding


94,665,333


107,258,320


93,972,187

Northwest Bancshares, Inc. and Subsidiaries

Asset Quality

(Dollars in thousands)














Three months ended


Year ended




March 31,


December 31,




2012


2011


2011


2010

Allowance for loan losses 










Beginning balance


$        71,138


76,412


76,412


70,403


Provision


6,287


7,244


34,170


40,486


Charge-offs residential mortgage


(1,043)


(1,205)


(4,198)


(4,497)


Charge-offs home equity


(892)


(2,255)


(4,734)


(4,104)


Charge-offs other consumer


(1,287)


(1,232)


(5,283)


(6,390)


Charge-offs commercial real estate


(1,473)


(2,276)


(12,508)


(12,576)


Charge-offs commercial


(649)


(1,041)


(15,641)


(9,305)


Recoveries


860


803


2,920


2,395


Ending balance


$        72,941


76,450


71,138


76,412





















Net charge-offs to average loans, annualized


0.32%


0.52%


0.72%


0.63%














March 31,


December 31,




2012


2011


2011


2010

Nonperforming loans


$     125,013


156,158


131,105


148,391

Real estate owned, net


28,895


19,682


26,887


20,780

Nonperforming assets


$     153,908


175,840


157,992


169,171











Non-accrual troubled debt restructuring *


$        29,606


37,393


29,575


41,740

Accruing troubled debt restructuring


37,697


23,925


39,854


10,865

Total troubled debt restructuring


$        67,303


61,318


69,429


52,605











Nonperforming loans to total loans


2.23%


2.85%


2.36%


2.68%











Nonperforming assets to total assets


1.91%


2.16%


1.99%


2.08%











Allowance for loan losses to total loans


1.30%


1.39%


1.28%


1.38%











Allowance for loan losses to nonperforming loans


58.35%


48.96%


54.26%


51.49%











* Amounts included in nonperforming loans above.



















Northwest Bancshares, Inc. and Subsidiaries

Non-accrual loans delinquency 

(Dollars in thousands)












March 31, 2012


December 31, 2011


March 31, 2011









Non-accrual loans current:








Residential mortgage loans


$                            -


-


-


Home equity loans


-


-


-


Other consumer loans


-


-


-


Commercial real estate loans


18,462


13,057


8,372


Commercial loans


4,232


13,480


15,292

Total non-accrual loans current


$                  22,694


26,537


23,664









Non-accrual loans delinquent 30 days to 59 days:








Residential mortgage loans


$                            -


-


-


Home equity loans


-


-


-


Other consumer loans


-


-


-


Commercial real estate loans


3,068


3,274


2,472


Commercial loans


6,258


90


3,072

Total non-accrual loans delinquent 30 days to 59 days


$                    9,326


3,364


5,544









Non-accrual loans delinquent 60 days to 89 days:








Residential mortgage loans


$                           -


-


-


Home equity loans


-


-


-


Other consumer loans


-


-


-


Commercial real estate loans


2,269


1,560


1,422


Commercial loans


534


3,808


691

Total non-accrual loans delinquent 60 days to 89 days


$                   2,803


5,368


2,113









Non-accrual loans delinquent 90 days or more:








Residential mortgage loans


$                 28,696


28,221


28,587


Home equity loans


9,100


9,560


9,300


Other consumer loans


1,983


2,667


2,914


Commercial real estate loans


34,601


44,603


61,561


Commercial loans


15,810


10,785


22,475

Total non- accrual loans delinquent 90 days or more


$                90,190


95,836


124,837









Total non-accrual loans


$              125,013


131,105


156,158

Northwest Bancshares, Inc. and Subsidiaries

Delinquency

(Dollars in thousands)








































Loan delinquency schedule













(Number of loans and dollar amount of loans)












March 31,


December 31,


March 31,



2012

*


2011

*


2011

*

Loans delinquent 30 days to 59 days:













Residential mortgage loans

366

$      29,414

1.2%


427

$    33,671

1.4%


365

$    30,370

1.3%


Home equity loans

201

7,086

0.7%


222

7,426

0.7%


161

5,607

0.5%


Other consumer loans

647

2,854

1.2%


903

4,854

2.0%


659

2,891

1.2%


Commercial real estate loans

77

9,275

0.6%


104

10,680

0.7%


86

12,669

0.9%


Commercial loans

29

7,069

1.7%


32

2,027

0.5%


60

12,519

2.9%

Total loans delinquent 30 days to 59 days

1,320

$      55,698

1.0%


1,688

$     58,658

1.1%


1,331

$     64,056

1.2%














Loans delinquent 60 days to 89 days:













Residential mortgage loans

22

$         1,466

0.1%


99

$        8,629

0.4%


48

$       4,154

0.2%


Home equity loans

50

2,313

0.2%


47

1,953

0.2%


52

2,355

0.2%


Other consumer loans

262

1,083

0.5%


412

1,787

0.7%


262

1,036

0.4%


Commercial real estate loans

27

3,203

0.2%


38

3,122

0.2%


35

3,322

0.2%


Commercial loans

16

1,376

0.3%


25

4,958

1.3%


15

973

0.2%

Total loans delinquent 60 days to 89 days

377

$        9,441

0.2%


621

$    20,449

0.4%


412

$     11,840

0.2%














Loans delinquent 90 days or more:













Residential mortgage loans

275

$      28,696

1.2%


273

$      28,221

1.2%


260

$      28,587

1.2%


Home equity loans

167

9,100

0.9%


177

9,560

0.9%


188

9,300

0.9%


Other consumer loans

348

1,983

0.8%


456

2,667

1.1%


380

2,914

1.2%


Commercial real estate loans

120

34,601

2.3%


131

44,603

3.1%


177

61,561

4.5%


Commercial loans

56

15,810

3.9%


66

10,785

2.8%


75

22,475

5.2%

Total loans delinquent 90 days or more

966

$      90,190

1.6%


1,103

$     95,836

1.7%


1,080

$  124,837

2.3%














Total loans delinquent

2,663

$   155,329

2.8%


3,412

$   174,943

3.2%


2,823

$   200,733

3.7%















* - Represents delinquency, in dollars, divided by the respective total amount of that class of loan outstanding.  

 

Northwest Bancshares, Inc. and Subsidiaries


Analysis of loan portfolio by geographic location as of March 31, 2012:


(Dollars in thousands)

















Loans outstanding:






























Residential mortgage

(1)

Home equity

(2)

Other consumer

(3)

Commercial real

estate loans

(4)

Commercial loans

(5)

Total

(6)

















Pennsylvania


$2,015,380

83.1%

902,239

85.1%

218,386

91.9%

859,567

58.4%

287,648

70.4%

4,283,220

76.4%


New York


159,926

6.6%

103,293

9.8%

10,980

4.6%

364,810

24.7%

53,588

13.1%

692,597

12.4%


Ohio


19,888

0.8%

11,423

1.1%

3,018

1.3%

38,948

2.6%

11,076

2.7%

84,353

1.5%


Maryland


163,022

6.7%

32,526

3.1%

1,414

0.6%

135,606

9.2%

22,650

5.5%

355,218

6.3%


Florida


26,473

1.1%

7,733

0.7%

1,279

0.5%

40,533

2.7%

16,083

3.9%

92,101

1.6%


All other 


42,244

1.7%

1,724

0.2%

2,514

1.1%

36,112

2.4%

17,849

4.4%

100,443

1.8%


     Total


$2,426,933

100.0%

1,058,938

100.0%

237,591

100.0%

1,475,576

100.0%

408,894

100.0%

5,607,932

100.0%

















(1) - Percentage of total mortgage loans











(2) - Percentage of total home equity loans











(3) - Percentage of total other consumer loans











(4) - Percentage of total commercial real estate loans











(5) - Percentage of total commercial loans











(6) - Percentage of total loans

























Loans 90 days or more delinquent:






























Residential mortgage

(7)

Home equity

(8)

Other consumer

(9)

Commercial real

estate loans

(10)

Commercial loans

(11)

Total

(12)

















Pennsylvania


$       7,794

0.9%

5,352

0.6%

1,943

0.9%

14,663

1.7%

5,755

2.0%

45,507

1.1%


New York


1,181

0.7%

1,390

1.3%

31

0.3%

6,400

1.8%

294

0.5%

9,296

1.3%


Ohio


390

2.0%

77

0.7%

2

0.1%

88

0.2%

17

0.2%

574

0.7%


Maryland


4,707

2.9%

1,640

5.0%

-

0.0%

5,361

4.0%

2,531

11.2%

14,239

4.0%


Florida


3,894

14.7%

613

7.9%

7

0.5%

412

1.0%

4,625

28.8%

9,551

10.4%


All other


730

1.7%

28

1.6%

-

0.0%

7,677

21.3%

2,588

14.5%

11,023

11.0%


     Total


$       28,696

1.2%

9,100

0.9%

1,983

0.8%

34,601

2.3%

15,810

3.9%

90,190

1.6%

















(7) - Percentage of total mortgage loans in that geographic area











(8) - Percentage of total home equity loans in that geographic area











(9) - Percentage of total other consumer loans in that geographic area











(10) - Percentage of total commercial real estate loans in that geographic area











(11) - Percentage of total commercial loans in that geographic area











(12) - Percentage of total loans in that geographic area










 

Northwest Bancshares, Inc. and Subsidiaries

Investment Portfolio

(Dollars in thousands)











Marketable securities available-for-sale as of March 31, 2012:














Gross


Gross








unrealized


unrealized






Amortized


holding


holding


Market




cost


gains


losses


value

Debt issued by the U.S. government and agencies:










Due in one year or less


$                     56


-


-


56











Debt issued by government sponsored enterprises:










Due in one year - five years


26,296


44


-


26,340


Due in five years - ten years


29,163


474


-


29,637


Due after ten years


9,125


-


(35)


9,090











Equity securities


12,398


4,676


(3)


17,071











Municipal securities:










Due in one year - five years


8,880


245


-


9,125


Due in five years - ten years


26,427


1,093


-


27,520


Due after ten years


116,529


5,905


(110)


122,324











Corporate trust preferred securities:










Due in one year or less


500


-


-


500


Due after ten years


25,019


275


(6,135)


19,159











Mortgage-backed securities:










Fixed rate pass-through


102,152


7,528


(16)


109,664


Variable rate pass-through


129,112


6,636


(4)


135,744


Fixed rate non-agency CMO


8,280


178


(307)


8,151


Fixed rate agency CMO


143,158


3,126


-


146,284


Variable rate non-agency CMO


1,023


-


(135)


888


Variable rate agency CMO


256,114


2,038


(127)


258,025












Total mortgage-backed securities


639,839


19,506


(589)


658,756












Total marketable securities available-for-sale


$       894,232


32,218


(6,872)


919,578











Marketable securities held-to-maturity as of March 31, 2012:














Gross


Gross








unrealized


unrealized






Amortized


holding


holding


Market




cost


gains


losses


value











Municipal securities:










Due in five years - ten years


3,678


171


-


3,849


Due after ten years


69,592


3,649


-


73,241











Mortgage-backed securities:










Fixed rate pass-through


22,815


1,117


-


23,932


Variable rate pass-through


8,649


54


-


8,703


Fixed rate agency CMO


100,008


2,436


-


102,444


Variable rate agency CMO


12,214


247


-


12,461












Total mortgage-backed securities


143,686


3,854


-


147,540












Total marketable securities held-to-maturity


$       216,956


7,674


-


224,630











Issuers of mortgage-backed securities as of March 31, 2012:










Fannie Mae


$       327,066


10,624


(84)


337,606


Ginnie Mae


132,296


4,012


(8)


136,300


Freddie Mac


296,401


8,546


(21)


304,926


SBA


17,744


-


(34)


17,710


Non-agency


10,018


178


(442)


9,754


   Total


$       783,525


23,360


(589)


806,296

Northwest Bancshares, Inc. and Subsidiaries

Investment Portfolio - Continued

(Dollars in thousands)


















Book 


 As a % 





value 


 of book 





3/31/2012


value


Municipal securities by state:







Pennsylvania







     School district


$       107,395


47.7%



     General obligation


37,329


16.6%



     Revenue bonds


4,709


2.1%



Total Pennsylvania


149,433


66.4%



New York


33,711


15.0%



Ohio


6,427


2.9%



All other states


35,535


15.8%





$       225,106




 

Average Balance Sheet - unaudited

(Dollars in thousands)








The following table sets forth certain information relating to the Company's average balance sheet and reflects the average yield on assets and

average cost of liabilities for the periods indicated.  Such yields and costs are derived by dividing income or expense by the average balance of

assets or liabilities, respectively, for the periods presented.  Average balances are calculated using daily averages.











 Three months ended March 31, 


2012

2011


 Average 

 Interest 

 Avg. 

 Average 

 Interest 

 Avg. 


 Balance 

 (h) 

 Yield/ 

 Balance 

 (h) 

 Yield/ 




 Cost 



 Cost 

Assets:







Interest-earning assets:







   Loans receivable (a) (b) (d)

$      5,579,071

78,691

5.67%

$      5,516,254

80,847

5.89%

   Mortgage-backed securities (c) 

746,954

4,691

2.51%

926,349

6,756

2.92%

   Investment securities (c) (d) 

343,059

4,336

5.06%

354,786

5,128

5.78%

   FHLB stock

48,246

-

-

58,845

-

-

   Other interest-earning deposits

658,747

380

0.23%

685,864

407

0.24%








Total interest-earning assets 

7,376,077

88,098

4.80%

7,542,098

93,138

4.96%








Noninterest earning assets (e)

615,734



592,981










Total assets

$      7,991,811



$      8,135,079










Liabilities and shareholders' equity:







Interest-bearing liabilities:







   Savings accounts

$      1,100,312

1,106

0.40%

$      1,063,696

1,429

0.55%

   Interest-bearing demand accounts

785,935

227

0.12%

773,633

232

0.12%

   Money market accounts

976,194

965

0.40%

915,768

1,155

0.51%

   Certificate accounts

2,236,823

10,646

1.91%

2,431,952

13,247

2.21%

   Borrowed funds (f)

833,843

6,477

3.12%

847,784

6,584

3.15%

   Junior subordinated debentures

103,094

1,422

5.46%

103,094

1,405

5.45%








Total interest-bearing liabilities

6,036,201

20,843

1.38%

6,135,927

24,052

1.59%








Noninterest bearing liabilities (g)

801,157



701,633










Total liabilities

6,837,358



6,837,560










Shareholders' equity

1,154,453



1,297,519










Total liabilities and shareholders' equity

$      7,991,811



$      8,135,079










Net interest income/ Interest rate spread


67,255

3.42%


69,086

3.37%








Net interest-earning assets/ Net interest margin

$      1,339,876


3.65%

$      1,406,171


3.66%








Ratio of interest-earning assets to







 interest-bearing liabilities

 1.22X 



 1.23X 










(a) Average gross loans receivable includes loans held as available-for-sale and loans placed on nonaccrual status.



(b) Interest income includes accretion/ amortization of deferred loan fees/ expenses, which was not material.



(c) Average balances do not include the effect of unrealized gains or losses on securities held as available-for-sale.



(d) Interest income on tax-free investment securities and tax-free loans are presented on a fully taxable equivalent basis.


(e) Average balances include the effect of unrealized gains or losses on securities held as available-for-sale.



(f) Average balances include FHLB borrowings, securities sold under agreements to repurchase and other borrowings.


(g) Average balances include non-interest bearing demand deposits (checking accounts).



(h) Shown on a FTE basis. GAAP basis yields for the periods indicated were: Loans - 5.63% and 5.87%, respectively, Investment securities - 3.52% 

       and 3.91%, respectively, Interest-earning assets - 4.70% and 4.83%, respectively. GAAP basis net interest rate spreads were 3.31% and 

      3.24%, respectively, and GAAP basis net interest margins were 3.55% and 3.56%, respectively.



Average Balance Sheet - unaudited

(Dollars in thousands)








The following table sets forth certain information relating to the Company's average balance sheet and reflects the average yield on assets and

average cost of liabilities for the periods indicated.  Such yields and costs are derived by dividing income or expense by the average balance of

assets or liabilities, respectively, for the periods presented.  Average balances are calculated using daily averages.











 Three months ended 

 Three months ended 


March 31, 2012

December 31, 2011


 Average 

 Interest 

 Avg. 

 Average 

 Interest 

 Avg. 


 Balance 

 (h) 

 Yield/ 

 Balance 

 (h) 

 Yield/ 




 Cost 



 Cost 

Assets:







Interest-earning assets:







   Loans receivable (a) (b) (d)

$      5,579,071

78,691

5.67%

$      5,544,194

80,395

5.79%

   Mortgage-backed securities (c) 

746,954

4,691

2.51%

797,071

5,077

2.55%

   Investment securities (c) (d) 

343,059

4,336

5.06%

376,545

4,776

5.07%

   FHLB stock

48,246

-

-

49,775

-

-

   Other interest-earning deposits

658,747

380

0.23%

615,906

423

0.27%








Total interest-earning assets 

7,376,077

88,098

4.80%

7,383,491

90,671

4.90%








Noninterest earning assets (e)

615,734



571,873










Total assets

$      7,991,811



$      7,955,364










Liabilities and shareholders' equity:







Interest-bearing liabilities:







   Savings accounts

$      1,100,312

1,106

0.40%

$      1,064,533

1,139

0.42%

   Interest-bearing demand accounts

785,935

227

0.12%

787,674

238

0.12%

   Money market accounts

976,194

965

0.40%

959,378

1,013

0.42%

   Certificate accounts

2,236,823

10,646

1.91%

2,308,440

11,837

2.03%

   Borrowed funds (f)

833,843

6,477

3.12%

836,948

6,604

3.13%

   Junior subordinated debentures

103,094

1,422

5.46%

103,094

1,437

5.45%








Total interest-bearing liabilities

6,036,201

20,843

1.38%

6,060,067

22,268

1.46%








Noninterest bearing liabilities (g)

801,157



734,898










Total liabilities

6,837,358



6,794,965










Shareholders' equity

1,154,453



1,160,399










Total liabilities and shareholders' equity 

$      7,991,811



$      7,955,364










Net interest income/ Interest rate spread


67,255

3.42%


68,403

3.44%








Net interest-earning assets/ Net interest margin

$      1,339,876


3.65%

$      1,323,424


3.71%








Ratio of interest-earning assets to