PBCT Total Return for 2005 Tops 23 Percent
BRIDGEPORT, Conn., Jan. 19 /PRNewswire-FirstCall/ -- People's Bank
(Nasdaq: PBCT), an $11 billion financial services company, today announced net
income increased 26 percent to $35.2 million, or $0.25 per share, for the
fourth quarter of 2005, compared to $28.0 million, or $0.20 per share, for the
fourth quarter of 2004. Income from continuing operations increased 30 percent
to $34.3 million, or $0.24 per share, from $26.3 million, or $0.19 per share,
for the year-ago quarter. Prior period per share information has been restated
to reflect the three-for-two stock split completed in May 2005.
For the year ended December 31, 2005, net income totaled $137.1 million,
or $0.97 per share, compared to $199.7 million, or $1.42 per share, for the
prior year. Included in the 2005 results are a gain on sale of three branches,
a gain from the resolution of the remaining contingencies related to the sale
of the credit card portfolio, a reduction in income tax expense, a goodwill
impairment charge and expenses incurred in connection with the repurchase of
subordinated notes and the accelerated vesting of stock options. Results for
2004 included the net gain on sale of People's credit card business, balance
sheet restructuring costs, other nonrecurring charges and a reduction in
income tax expense. Excluding such items from both 2005 and 2004, net income
would have been $127.1 million, or $0.90 per share, in 2005 and $90.0 million,
or $0.64 per share, in 2004, a 41 percent increase.
For the fourth quarter of 2005, return on average assets was 1.30 percent
and return on average stockholders' equity was 11.1 percent, compared to 1.06
percent and 9.4 percent, respectively, for the year-ago quarter.
People's Board of Directors declared a $0.22 per share quarterly dividend
on People's common stock, payable February 15, 2006, to shareholders of record
on February 1, 2006. People's Mutual Holdings, which owns 82.0 million shares
of People's Bank common stock, will accept dividends on only 2.5 percent of
its shares. Based on the closing stock price on January 18, 2006, the dividend
yield on People's Bank common stock is 2.7 percent.
"2005 was a year of dramatic improvement in core earnings for People's
Bank and another rewarding one for our shareholders, as People's common stock
generated a total return for the year of 23 percent," stated John A. Klein,
President and Chief Executive Officer. "We continued growing our core lending
businesses and investing in our banking franchise, thus further strengthening
our focus on the fundamentals.
"During 2005 we continued to generate healthy loan growth across our
commercial and consumer businesses while maintaining outstanding asset
quality," added Klein. "Our average commercial banking, home equity and
residential mortgage loan portfolios increased a combined $900 million, or 12
percent, compared to last year. Optimizing the performance of our branch
franchise, whose concentration in Fairfield County makes it the most
attractive in Connecticut, we opened six new branches across the state and
sold three in eastern Connecticut."
Klein concluded, "Our 2005 performance further demonstrates the
significant value of the bank's franchise in Connecticut, one of the most
attractive banking markets in the nation. People's is the only major bank in
the state that is uniquely focused on Connecticut's consumers and businesses."
Results for the fourth quarter of 2005 included several essentially
offsetting significant items, including an $8.1 million gain on sale of three
branches (included in non-interest income) and a $2.0 million reduction in
income tax expense relating to the completion of a federal tax audit.
Noteworthy expense items this quarter included: a $2.7 million charge related
to the repurchase of subordinated notes; a $0.7 million charge for the
accelerated vesting of stock options (both included in non-interest expense);
a $2.3 million charge-off related to one commercial banking loan; and a $2.0
million increase in the allowance for loan losses (both reflected in the
provision for loan losses).
"Key drivers of the bank's performance this quarter were another increase
in the net interest margin and continued growth in fee-based revenues," said
Philip R. Sherringham, Executive Vice President and Chief Financial Officer.
"The year-over-year 18 basis point improvement in the net interest margin
reflects a combination of the bank's asset-sensitive position and the ongoing
substitution of securities with higher-yielding loans. In fact, average loans
increased $720 million, or 9 percent, year-over-year, while average
investments declined $646 million, or 30 percent. The 10 percent increase in
fee-based revenues reflects the benefit from our revenue initiatives
implemented during 2005."
Commenting on asset quality, Sherringham added, "Fourth quarter net loan
charge-offs totaled $3.3 million, or 0.16 percent of average loans on an
annualized basis, compared to $4.5 million, or 0.23 percent, respectively, in
the fourth quarter of last year." Included in the fourth quarter of 2005 is a
$2.3 million charge-off relating to one commercial banking loan, while the
year-ago quarter also included a $3.2 million charge-off relating to another
commercial banking loan.
At December 31, 2005, non-performing assets totaled $22.0 million, a $6.6
million, or 23 percent, decrease from the prior year and equaled 0.26 percent
of total loans, REO and repossessed assets, compared to 0.36 percent at
December 31, 2004. The allowance for loan losses as a percentage of non-
performing loans was 353 percent at December 31, 2005, compared to 265 percent
at December 31, 2004. The allowance for loan losses as a percentage of total
loans was 0.87 percent at December 31, 2005, compared to 0.91 percent a year
ago.
Sherringham continued, "Our efficiency ratio was 62.6 percent in the
fourth quarter of 2005, compared to 66.5 percent in the fourth quarter of
2004. The 390 basis point improvement from the year-ago quarter reflects
continued expense control and a significant increase in revenue, including a 6
percent increase in net interest income and a 13 percent increase in adjusted
non-interest income."
Selected Financial Terms
In addition to presenting financial information in accordance with
generally accepted accounting principles ("GAAP"), certain non-GAAP
information is also presented, such as operating revenue and the efficiency
ratio. Operating revenue is based on income from continuing operations reduced
by gains and losses other than from the sale of residential mortgage loans and
excluding other items that may recur from time to time but that are deemed to
occur irregularly or infrequently. Management considers this measure to be
more representative of People's ongoing profitability, as the excluded items
are generally related to external market conditions and non-routine
transactions.
The efficiency ratio, which is derived in part from operating revenue and
represents an approximate measure of the cost required by People's to generate
a dollar of revenue, is the ratio of operating expense to operating revenue.
Operating expense equals People's total non-interest expense, excluding
goodwill impairment, amortization of acquisition-related intangibles, losses
on real estate assets, and nonrecurring expenses. People's considers an
expense to be "nonrecurring" if it is not similar to an expense of a type
incurred within the last two years, and is not similar to an expense of a type
reasonably expected to be incurred within the following two years.
This release contains information about People's core deposits and
purchased funds (both non-GAAP measures). Core deposits, a measure of stable
funding sources, equal total deposits, other than brokered certificates of
deposit (acquired in the wholesale market), municipal deposits (which are
seasonally variable by nature) and non-interest-bearing deposits utilized for
the operation of People's businesses. Purchased funds include borrowings,
brokered certificates of deposit and municipal deposits.
Conference Call
On January 20, 2006, at 11 a.m., Eastern Time, People's will host a
conference call to discuss this earnings announcement. The call may be heard
through http://www.peoples.com by selecting "Investor Relations" in the "About
People's" section on the home page, and then selecting "Conference Calls" in
the "News and Events" section. Additional materials relating to the call may
also be accessed at People's Web site. The call will be archived on the Web
site and available for approximately 90 days.
4Q Financial Highlights (4Q 2005 compared with 4Q 2004 unless otherwise
indicated)
Summary
* Net income totaled $35.2 million, or $0.25 per share.
* Income from continuing operations increased $8.0 million.
* Net interest income increased $5.2 million.
-- Net interest margin increased 18 basis points from 4Q04 and improved
5 basis points from 3Q05 to 3.75%.
* Provision for loan losses increased $3.3 million.
-- Net loan charge-offs decreased $1.2 million (4Q05 included a $2.3
million charge-off related to one commercial banking loan and 4Q04
included a $3.2 million charge-off related to another commercial
banking loan).
-- The allowance for loan losses was increased $2.0 million in 4Q05 and
decreased $2.5 million in 4Q04.
* Non-interest income, excluding the $8.1 million gain on sale of three
branches, increased $5.1 million, or 13%.
-- Total fee-based revenues increased $3.5 million, or 10%.
-- Included in 4Q05 is $1.6 million related to the bank's investment in
bank-owned life insurance.
* Non-interest expense, excluding the $3.4 million of charges discussed
previously, increased $2.8 million, or 3%.
-- Compensation and benefits increased $3.8 million (included in 4Q05 is
the $0.7 million charge relating to the accelerated vesting of stock
options as well as higher accruals for incentives and commission-
related expense).
* Income tax expense this quarter was reduced by $2.0 million as a result
of the completion of a federal tax audit.
Commercial Banking
* Average commercial banking loans grew $314 million, or 9%.
* Average commercial non-interest-bearing deposits increased $26 million,
or 3%.
* The ratio of non-performing commercial banking loans to total commercial
banking loans was 0.33% at December 31, 2005, compared to 0.54% at
December 31, 2004.
-- Non-performing loans decreased $5.7 million, or 30%, from December
31, 2004.
* Net loan charge-offs totaled $2.5 million, or 0.28% of average
commercial banking loans.
Consumer Financial Services
* Average residential mortgage loans increased $265 million, or 8%.
* Average home equity loan portfolios increased $179 million, or 17%.
* Average consumer non-interest-bearing deposits grew $36 million, or 3%.
Treasury
* Average securities and short-term investments declined $646 million, or
30%.
-- Securities made up 14% of average earning assets compared to 21% in
4Q04.
-- The debt securities portfolio totaled $1.3 billion at December 31,
2005, a $724 million, or 36% decrease from a year ago.
People's Bank is a diversified financial services company providing
consumer and commercial banking services, in addition to insurance, trust and
financial advisory services. The bank is a leader in supermarket banking, with
70 of its 153 branches located in Super Stop & Shop stores. Through its
subsidiaries, People's provides brokerage and financial advisory services,
asset management, equipment financing and insurance services.
Certain statements contained in this release are forward-looking in
nature. These include all statements about People's plans, objectives,
expectations and other statements that are not historical facts, and usually
use words such as "expect," "anticipate," "believe" and similar expressions.
Such statements represent management's current beliefs, based upon information
available at the time the statements are made, with regard to the matters
addressed. All forward-looking statements are subject to risks and
uncertainties that could cause People's actual results or financial condition
to differ materially from those expressed in or implied by such statements.
Factors of particular importance to People's include, but are not limited to:
(1) changes in general economic conditions, including interest rates; (2)
potential improvements or deterioration in credit quality; (3) competition
among providers of financial services; (4) residential mortgage and secondary
market activity; (5) changes in accounting and regulatory guidance applicable
to banks; and (6) price levels and conditions in the public securities markets
generally. People's does not undertake any obligation to update or revise any
forward-looking statements, whether as a result of new information, future
events or otherwise.
Access People's Bank on the World Wide Web at http://www.peoples.com.
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People's Bank and Subsidiaries
FINANCIAL HIGHLIGHTS
Three Months Ended
Dec. 31, Sept. 30, June 30, March 31, Dec. 31,
(dollars in millions, 2005 2005 2005 2005 2004
except per share data)
Operating Data:
Net interest income $93.3 $92.5 $92.7 $91.2 $88.1
Provision for loan losses 5.3 1.1 0.9 1.3 2.0
Fee-based revenues 39.8 39.6 36.6 35.5 36.3
Net security gains (losses) - (0.1) 0.1 (0.1) -
All other non-interest
income (1) 11.9 4.6 2.0 1.9 2.2
Non-interest expense (2) 90.1 85.8 85.7 81.3 83.9
Income from continuing
operations 34.3 32.4 29.4 29.8 26.3
Gain on sale of discontinued
operations, net of tax - - 6.2 - -
Income from discontinued
operations 0.9 1.1 7.6 1.6 1.7
Net income 35.2 33.5 37.0 31.4 28.0
Selected Statistical Data:
Net interest margin (3) 3.75% 3.70% 3.66% 3.62% 3.57%
Return on average
assets (3) 1.30 1.24 1.36 1.17 1.06
Return on average
stockholders' equity (3) 11.1 10.7 12.0 10.4 9.4
Efficiency ratio 62.6 62.5 63.3 62.8 66.5
Per Common Share Data:
Basic earnings per share $0.25 $0.24 $0.26 $0.22 $0.20
Diluted earnings per share 0.25 0.24 0.26 0.22 0.20
Dividends paid per
share (4) 0.22 0.22 0.22 0.19 0.19
Dividend payout ratio (4) 38.6% 40.3% 36.5% 37.7% 42.3%
Book value (end of period) $9.10 $8.95 $8.84 $8.61 $8.52
Tangible book value (end of
period) 8.35 8.20 8.09 7.84 7.74
Stock price:
High 33.57 33.75 30.48 28.00 29.65
Low 28.85 28.17 26.27 23.99 23.30
Close (end of period) 31.06 28.98 30.24 27.30 25.93
Average diluted shares
outstanding
(in millions) 141.96 141.88 141.72 141.42 141.24
(1) Includes an $8.1 million gain on asset sale for the three months
ended December 31, 2005.
(2) Includes liability restructuring costs totaling $2.7 million for the
three months ended December 31, 2005.
(3) Annualized.
(4) Reflects the waiver of dividends on the substantial majority of the
common shares owned by People's Mutual Holdings.
People's Bank and Subsidiaries
FINANCIAL HIGHLIGHTS
Years Ended
December 31, December 31,
(dollars in millions, except per share data) 2005 2004
Operating Data:
Net interest income $369.7 $327.1
Provision for loan losses 8.6 13.3
Fee-based revenues 151.5 142.9
Net security losses (0.1) (4.7)
All other non-interest income (1) 20.4 12.6
Non-interest expense (2) 342.9 478.9
Income (loss) from continuing operations 125.9 (5.7)
Gain on sale of discontinued operations,
net of tax 6.2 198.5
Income from discontinued operations 11.2 205.4
Net income 137.1 199.7
Selected Statistical Data:
Net interest margin 3.68% 3.33%
Return on average assets 1.27 1.86
Return on average stockholders' equity 11.1 17.6
Efficiency ratio 62.9 69.1
Per Common Share Data:
Basic earnings per share $0.97 $1.43
Diluted earnings per share 0.97 1.42
Dividends paid per share (3) 0.85 0.75
Dividend payout ratio (3) 38.3% 22.9%
Book value (end of period) $9.10 $8.52
Tangible book value (end of period) 8.35 7.74
Stock price:
High 33.75 29.65
Low 23.99 14.44
Close (end of period) 31.06 25.93
Average diluted shares outstanding
(in millions) 141.76 140.88
(1) Includes an $8.1 million gain on asset sale for the year ended
December 31, 2005.
(2) Includes liability restructuring costs totaling $2.7 million and
$133.4 million for the years ended December 31, 2005 and 2004,
respectively.
(3) Reflects the waiver of dividends on the substantial majority of the
common shares owned by People's Mutual Holdings.
People's Bank and Subsidiaries
FINANCIAL HIGHLIGHTS - Continued
As of and for the Three Months Ended
Dec. 31, Sept. 30, June 30, March 31, Dec. 31,
(dollars in millions) 2005 2005 2005 2005 2004
Financial Condition Data:
General:
Total assets $10,933 $10,891 $10,931 $10,857 $10,718
Loans 8,573 8,383 8,288 8,088 7,933
Allowance for loan losses 75 73 73 73 73
Securities, net 1,363 1,498 1,658 1,971 2,071
Deposits 9,083 9,086 9,177 9,046 8,862
Core deposits 8,873 8,858 8,978 8,829 8,681
Borrowings 295 271 234 289 341
Purchased funds 424 404 313 400 447
Subordinated notes 109 122 122 122 122
Stockholders' equity 1,289 1,268 1,251 1,216 1,200
Non-performing assets 22 20 24 27 29
Net loan charge-offs 3.4 1.1 0.9 0.8 4.5
Average Balances:
Loans $8,438 $8,318 $8,184 $7,984 $7,718
Securities 1,438 1,580 1,908 2,034 2,108
Earning assets 9,952 9,992 10,171 10,079 9,878
Total assets 10,800 10,849 10,879 10,752 10,573
Deposits 8,966 9,060 9,050 8,847 8,819
Funding liabilities 9,367 9,426 9,475 9,352 9,180
Stockholders' equity 1,273 1,253 1,228 1,205 1,186
Ratios:
Net loan charge-offs to
average loans (1) 0.16% 0.05% 0.04% 0.04% 0.23%
Non-performing assets to
total loans,
REO and repossessed
assets 0.26 0.24 0.29 0.33 0.36
Allowance for loan losses
to non-performing loans 352.5 379.6 312.3 280.0 264.6
Allowance for loan losses
to total loans 0.87 0.87 0.88 0.90 0.91
Average stockholders'
equity to average assets 11.8 11.5 11.3 11.2 11.2
Stockholders' equity to
total assets 11.8 11.6 11.4 11.2 11.2
Tier 1 leverage capital (2) 11.2 11.0 10.7 10.6 10.5
Tier 1 risk-based
capital (2) 14.8 14.9 14.8 14.7 14.6
Total risk-based
capital (2) 16.4 17.0 16.8 16.8 16.7
(1) Annualized.
(2) December 31, 2005 capital ratios are preliminary.
People's Bank and Subsidiaries
CONSOLIDATED STATEMENTS OF CONDITION
Dec. 31, Sept. 30, Dec. 31,
(in millions) 2005 2005 2004
Assets
Cash and due from banks $391.6 $358.4 $309.0
Short-term investments 31.9 96.2 24.2
Total cash and cash equivalents 423.5 454.6 333.2
Securities:
Trading account securities, at fair
value 27.3 34.0 11.7
Securities available for sale, at
fair value 1,334.3 1,462.5 2,058.1
Securities held to maturity, at
amortized cost 1.4 1.4 1.4
Total securities 1,363.0 1,497.9 2,071.2
Securities purchased under agreements
to resell 25.0 25.0 -
Loans:
Residential mortgage 3,507.9 3,477.1 3,266.4
Commercial 2,029.2 1,918.3 1,688.9
Commercial real estate finance 1,778.3 1,736.2 1,838.1
Consumer 1,257.5 1,251.0 1,140.0
Total loans 8,572.9 8,382.6 7,933.4
Less allowance for loan losses (75.0) (73.0) (72.5)
Total loans, net 8,497.9 8,309.6 7,860.9
Premises and equipment, net 149.4 148.4 148.5
Goodwill and other acquisition-
related intangibles 106.2 106.4 109.9
Bank-owned life insurance 154.6 152.9 0.8
Other assets 212.9 196.3 193.4
Total assets $10,932.5 $10,891.1 $10,717.9
Liabilities
Deposits:
Non-interest-bearing $2,353.1 $2,319.4 $2,227.1
Savings, interest-bearing checking
and money market 3,767.4 3,895.6 4,232.7
Time 2,962.1 2,871.0 2,402.2
Total deposits 9,082.6 9,086.0 8,862.0
Borrowings:
Federal funds purchased 269.9 270.7 240.8
Federal Home Loan Bank advances 25.0 - 100.0
Total borrowings 294.9 270.7 340.8
Subordinated notes 108.6 122.0 121.8
Other liabilities 157.8 144.7 193.5
Total liabilities 9,643.9 9,623.4 9,518.1
Stockholders' Equity
Common stock (without par value;
150.0 shares authorized;
141.6 shares, 141.6 shares and 140.8
shares issued and outstanding) 141.6 141.6 140.8
Additional paid-in capital 172.0 170.1 157.5
Retained earnings 998.4 976.7 913.7
Accumulated other comprehensive loss (23.4) (20.7) (12.2)
Total stockholders' equity 1,288.6 1,267.7 1,199.8
Total liabilities and
stockholders' equity $10,932.5 $10,891.1 $10,717.9
People's Bank and Subsidiaries
CONSOLIDATED STATEMENTS OF INCOME
Three Months Ended
Dec. 31, Sept. 30, June 30, March 31, Dec. 31,
(in millions, except per 2005 2005 2005 2005 2004
share data)
Interest and dividend income:
Residential mortgage $40.7 $39.1 $38.1 $36.8 $35.4
Commercial real estate
finance 29.8 29.3 29.0 28.1 27.9
Commercial 31.0 28.4 25.9 23.4 20.8
Consumer 18.9 17.3 15.5 14.1 12.8
Total interest on loans 120.4 114.1 108.5 102.4 96.9
Securities 12.6 13.7 16.5 17.2 17.2
Short-term investments 0.5 0.5 0.3 0.2 0.3
Securities purchased
under agreements to resell 0.3 0.3 0.3 0.1 -
Total interest and dividend
income 133.8 128.6 125.6 119.9 114.4
Interest expense:
Deposits 34.8 31.2 27.9 23.6 22.3
Borrowings 2.8 2.1 2.2 2.3 1.2
Subordinated notes 2.9 2.8 2.8 2.8 2.8
Total interest expense 40.5 36.1 32.9 28.7 26.3
Net interest income 93.3 92.5 92.7 91.2 88.1
Provision for loan losses 5.3 1.1 0.9 1.3 2.0
Net interest income after
provision for loan losses 88.0 91.4 91.8 89.9 86.1
Non-interest income:
Fee-based revenues:
Service charges on deposit
accounts 19.8 19.9 17.3 15.4 16.8
Insurance revenue 7.6 7.1 5.9 7.4 8.0
Brokerage commissions 2.9 3.0 3.7 3.1 3.2
Other fees 9.5 9.6 9.7 9.6 8.3
Total fee-based revenues 39.8 39.6 36.6 35.5 36.3
Net security gains (losses) - (0.1) 0.1 (0.1) -
Net gains on sales of
residential mortgage loans 0.9 1.5 1.0 0.6 0.7
Gain on sale of assets 8.1 - - - -
Bank-owned life insurance 1.6 1.6 0.1 - -
Other non-interest income 1.3 1.5 0.9 1.3 1.5
Total non-interest income 51.7 44.1 38.7 37.3 38.5
Non-interest expense:
Compensation and benefits 49.7 49.7 48.4 47.7 45.9
Occupancy and equipment 16.4 15.4 14.7 15.7 16.5
Professional and outside
service fees 6.9 6.5 6.7 6.0 7.8
Liability restructuring costs 2.7 - - - -
Goodwill impairment charge - - 2.0 - -
Other non-interest expense 14.4 14.2 13.9 11.9 13.7
Total non-interest expense 90.1 85.8 85.7 81.3 83.9
Income from continuing
operations before income
tax expense 49.6 49.7 44.8 45.9 40.7
Income tax expense 15.3 17.3 15.4 16.1 14.4
Income from continuing
operations 34.3 32.4 29.4 29.8 26.3
Discontinued operations:
Income from discontinued
operations, net of tax 0.9 1.1 1.4 1.6 1.7
Gain on sale of discontinued
operations, net of tax - - 6.2 - -
Income from discontinued
operations 0.9 1.1 7.6 1.6 1.7
Net income $35.2 $33.5 $37.0 $31.4 $28.0
Diluted earnings per
common share:
Income from continuing
operations $0.24 $0.23 $0.21 $0.21 $0.19
Income from discontinued
operations 0.01 0.01 0.05 0.01 0.01
Net income 0.25 0.24 0.26 0.22 0.20
People's Bank and Subsidiaries
CONSOLIDATED STATEMENTS OF INCOME
Years Ended
Dec. 31, Dec. 31,
(in millions, except per share data) 2005 2004
Interest and dividend income:
Residential mortgage $154.7 $137.7
Commercial real estate finance 116.2 104.9
Commercial 108.7 73.3
Consumer 65.8 46.7
Total interest on loans 445.4 362.6
Securities 60.0 72.4
Short-term investments 1.5 2.2
Securities purchased under
agreements to resell 1.0 -
Total interest and dividend income 507.9 437.2
Interest expense:
Deposits 117.5 86.7
Borrowings 9.4 13.6
Subordinated notes 11.3 13.4
Interest allocated to discontinued operations - (3.6)
Total interest expense 138.2 110.1
Net interest income 369.7 327.1
Provision for loan losses 8.6 13.3
Net interest income after
provision for loan losses 361.1 313.8
Non-interest income:
Fee-based revenues:
Service charges on deposit accounts 72.4 69.2
Insurance revenue 28.0 27.9
Brokerage commissions 12.7 13.1
Other fees 38.4 32.7
Total fee-based revenues 151.5 142.9
Net security losses (0.1) (4.7)
Net gains on sales of residential
mortgage loans 4.0 3.7
Gain on sale of assets 8.1 -
Bank-owned life insurance 3.3 -
Other non-interest income 5.0 8.9
Total non-interest income 171.8 150.8
Non-interest expense:
Compensation and benefits 195.5 194.3
Occupancy and equipment 62.2 69.2
Professional and outside service
fees 26.1 25.8
Liability restructuring costs 2.7 133.4
Goodwill impairment charge 2.0 -
Other non-interest expense 54.4 56.2
Total non-interest expense 342.9 478.9
Income (loss) from continuing
operations before income tax expense
(benefit) 190.0 (14.3)
Income tax expense (benefit) 64.1 (8.6)
Income (loss) from continuing
operations 125.9 (5.7)
Discontinued operations:
Income from discontinued operations,
net of tax 5.0 6.9
Gain on sale of discontinued operations,
net of tax 6.2 198.5
Income from discontinued operations 11.2 205.4
Net income $137.1 $199.7
Diluted earnings per common share:
Income (loss) from continuing operations $0.89 $(0.04)
Income from discontinued operations 0.08 1.46
Net income 0.97 1.42
People's Bank and Subsidiaries
AVERAGE BALANCE, INTEREST AND YIELD/RATE ANALYSIS (1)
December 31, 2005 September 30, 2005
Three months ended Average Yield/ Average Yield/
(dollars in millions) Balance Interest Rate Balance Interest Rate
Earning assets:
Short-term investments $50.9 $0.5 3.93% $69.4 $0.5 2.97%
Securities purchased
under agreements to resell 25.0 0.3 4.61 25.0 0.3 4.45
Securities (2) 1,437.7 12.6 3.53 1,579.5 13.7 3.47
Loans:
Residential mortgage 3,495.0 40.7 4.66 3,456.7 39.1 4.53
Commercial real estate
finance 1,750.5 29.8 6.80 1,768.1 29.3 6.62
Commercial 1,935.5 31.0 6.40 1,865.3 28.4 6.09
Consumer 1,257.4 18.9 6.03 1,227.6 17.3 5.63
Total loans 8,438.4 120.4 5.71 8,317.7 114.1 5.49
Total earning assets $9,952.0 $133.8 5.38% $9,991.6 $128.6 5.15%
Funding liabilities:
Deposits:
Non-interest-bearing
deposits $2,139.1 $- -% $2,160.1 $- -%
Savings, interest-
bearing checking
and money market 3,808.5 11.9 1.25 3,964.9 10.8 1.09
Time 2,843.7 22.1 3.12 2,739.4 19.8 2.88
Total core deposits 8,791.3 34.0 1.55 8,864.4 30.6 1.38
Non-core deposits 174.8 0.8 2.00 195.5 0.6 1.23
Total deposits 8,966.1 34.8 1.56 9,059.9 31.2 1.38
Borrowings:
Federal funds
purchased 274.3 2.7 3.97 237.9 2.0 3.44
Federal Home Loan Bank
advances 6.7 0.1 4.00 6.7 0.1 3.50
Total borrowings 281.0 2.8 3.97 244.6 2.1 3.44
Subordinated notes 119.4 2.9 9.64 121.9 2.8 9.18
Total funding
liabilities $9,366.5 $40.5 1.73% $9,426.4 $36.1 1.53%
Excess of earning assets
over funding
liabilities $585.5 $565.2
Net interest
income/spread $93.3 3.65% $92.5 3.62%
Net interest margin 3.75% 3.70%
(1) Average yields earned and rates paid are annualized.
(2) Average balances and yields for securities available for sale are
based on amortized cost.
People's Bank and Subsidiaries
AVERAGE BALANCE, INTEREST AND YIELD/RATE ANALYSIS (1)
December 31, 2004
Three months ended Average Yield/
(dollars in millions) Balance Interest Rate
Earning assets:
Short-term investments $51.3 $0.3 1.71%
Securities purchased under
agreements to resell - - -
Securities (2) 2,108.1 17.2 3.27
Loans:
Residential mortgage 3,229.8 35.4 4.38
Commercial real estate finance 1,821.1 27.9 6.12
Commercial 1,551.0 20.8 5.37
Consumer 1,116.3 12.8 4.60
Total loans 7,718.2 96.9 5.02
Total earning assets $9,877.6 $114.4 4.63%
Funding liabilities:
Deposits:
Non-interest-bearing deposits $2,076.7 $- - %
Savings, interest-bearing checking
and money market 4,246.1 8.7 0.82
Time 2,310.2 13.1 2.27
Total core deposits 8,633.0 21.8 1.01
Non-core deposits 185.8 0.5 1.14
Total deposits 8,818.8 22.3 1.01
Borrowings:
Federal funds purchased 220.5 1.1 1.91
Federal Home Loan Bank advances 19.2 0.1 2.12
Total borrowings 239.7 1.2 1.93
Subordinated notes 121.8 2.8 9.19
Total funding liabilities $9,180.3 $26.3 1.14%
Excess of earning assets
over funding liabilities $697.3
Net interest income/spread $88.1 3.49%
Net interest margin 3.57%
(1) Average yields earned and rates paid are annualized.
(2) Average balances and yields for securities available for sale are
based on amortized cost.
People's Bank and Subsidiaries
AVERAGE BALANCE, INTEREST AND YIELD/RATE ANALYSIS
December 31, 2005 December 31, 2004
Years ended Average Yield/ Average Yield/
(dollars in millions) Balance Interest Rate Balance Interest Rate
Earning assets:
Short-term investments $54.5 $1.5 2.86% $198.0 $2.3 1.19%
Securities purchased
under agreements
to resell 22.8 1.0 4.22 - - -
Securities (1) 1,737.8 60.3 3.47 2,248.0 72.5 3.23
Loans:
Residential mortgage 3,413.3 154.7 4.53 3,163.4 137.7 4.35
Commercial real
estate finance 1,790.5 116.2 6.49 1,760.7 105.0 5.96
Commercial 1,825.5 108.7 5.95 1,437.6 73.3 5.10
Consumer 1,203.3 65.8 5.47 1,035.0 46.7 4.51
Total loans 8,232.6 445.4 5.41 7,396.7 362.7 4.90
Total earning
assets $10,047.7 $508.2 5.06% $9,842.7 $437.5 4.45%
Funding liabilities:
Deposits:
Non-interest-bearing
deposits $2,142.0 $- -% $2,043.7 $- -%
Savings, interest-
bearing checking
and money market 4,023.4 42.6 1.06 4,274.7 34.4 0.81
Time 2,648.8 72.6 2.74 2,271.5 50.9 2.24
Total core deposits 8,814.2 115.2 1.31 8,589.9 85.3 0.99
Non-core deposits 167.2 2.3 1.40 198.5 1.4 0.69
Total deposits 8,981.4 117.5 1.31 8,788.4 86.7 0.99
Borrowings:
Federal funds
purchased 250.5 7.9 3.19 249.6 3.2 1.25
Federal Home Loan
Bank advances 50.3 1.4 2.73 176.1 9.4 5.32
Repurchase agreements 1.7 0.1 2.41 36.1 1.0 2.91
Total borrowings 302.5 9.4 3.11 461.8 13.6 2.94
Subordinated notes 121.2 11.3 9.29 146.5 13.4 9.16
Funding liabilities
allocated to
discontinued
operations (2) - - - (203.6) (3.6) 1.77
Total funding
liabilities $9,405.1 $138.2 1.47% $9,193.1 $110.1 1.20%
Excess of earning
assets over funding
liabilities $642.6 $649.6
Net interest
income/spread $370.0 3.59% $327.4 3.25%
Net interest margin 3.68% 3.33%
(1) Average balances and yields for securities available for sale are
based on amortized cost.
(2) Represents an allocation of funding liabilities and interest expense
to discontinued operations.
People's Bank and Subsidiaries
NON-PERFORMING ASSETS
Dec. Sept. June March Dec.
31, 30, 30, 31, 31,
(dollars in millions) 2005 2005 2005 2005 2004
Non-accrual loans:
Residential mortgage $6.7 $3.9 $6.7 $5.5 $7.5
PCLC 6.2 5.9 7.0 6.5 5.1
Commercial real estate finance 5.8 5.9 5.9 7.4 8.7
Commercial 1.3 2.3 2.5 5.2 5.2
Consumer 1.3 1.2 1.2 1.5 0.9
Total non-accrual loans 21.3 19.2 23.3 26.1 27.4
Real estate owned ("REO") and
repossessed assets, net 0.7 0.9 0.9 0.9 1.2
Total non-performing assets $22.0 $20.1 $24.2 $27.0 $28.6
Non-performing loans as a percentage of
total loans 0.25% 0.23% 0.28% 0.32% 0.35%
Non-performing assets as a percentage
of total loans,
REO and repossessed assets 0.26 0.24 0.29 0.33 0.36
Non-performing assets as a percentage
of stockholders' equity and
allowance for loan losses 1.62 1.50 1.83 2.09 2.25
Allowance for loan losses as a
percentage of non-performing loans 352.5 379.6 312.3 280.0 264.6
Allowance for loan losses as a
percentage of total loans 0.87 0.87 0.88 0.90 0.91
People's Bank and Subsidiaries
ALLOWANCE FOR LOAN LOSSES
Three Months Ended
Dec. Sept. June March Dec.
31, 30, 30, 31, 31,
(in millions) 2005 2005 2005 2005 2004
Balance at beginning of period $73.0 $73.0 $73.0 $72.5 $75.0
Charge-offs (4.1) (1.6) (1.7) (1.7) (5.4)
Recoveries 0.8 0.5 0.8 0.9 0.9
Net loan charge-offs (3.3) (1.1) (0.9) (0.8) (4.5)
Provision for loan losses 5.3 1.1 0.9 1.3 2.0
Balance at end of period $75.0 $73.0 $73.0 $73.0 $72.5
People's Bank and Subsidiaries
NET LOAN CHARGE-OFFS (RECOVERIES)
Three Months Ended
Dec. Sept. June March Dec.
31, 30, 30, 31, 31,
(in millions) 2005 2005 2005 2005 2004
PCLC $2.5 $0.1 $- $0.2 $0.6
Consumer 0.9 0.6 0.8 0.6 0.7
Commercial - 0.4 0.1 - 0.1
Residential mortgage (0.1) - - - (0.1)
Commercial real estate finance - - - - 3.2
Total $3.3 $1.1 $0.9 $0.8 $4.5
SOURCE People's Bank
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Related links:
http://www.peoples.com
Company News On-Call:
http://www.prnewswire.com/comp/113252.html
CONTACT:
Vincent J. Calabrese, Senior Vice President
and Controller, +1-203-338-4114, Fax: +1-203-338-2362,
vince.calabrese@peoples.com, or Valerie C. Carlson, Vice
President, Corporate Communications, +1-203-338-2351,
+1-203-338-3461, valerie.carlson@peoples.com, both of People's
Bank
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