Sterling Bancorp Reports First Quarter 2023 Financial Results
First Quarter 2023 Highlights
-
Net loss of
$(0.5) million , or$(0.01) per diluted share - Net interest margin of 2.93%
-
Adopted Current Expected Credit Loss (“CECL”) methodology on
January 1, 2023 , resulting in a$0.5 million increase (after tax) to retained earnings -
Recorded provision for credit losses of
$0.7 million ; ratio of allowance for credit losses to total loans held for investment of 2.48% -
Non-interest expense of
$17.8 million -
Shareholders’ equity of
$315.5 million - Company’s consolidated and Bank’s leverage ratio of 13.49% and 16.52%, respectively
-
Total deposits of
$1.9 billion -
Total gross loans held for investment of
$1.6 billion - All debt securities are available for sale; none held to maturity
-
Reclassified
$41.1 million of nonaccrual and delinquent residential loans as held for sale; with this reclassification there are virtually no nonperforming assets held for investment; reduced total nonperforming assets to$26.3 million , almost entirely comprised of nonaccrual residential loans held for sale -
Entered into Plea Agreement with
Department of Justice , resolving the investigation of the Bank and the Company relating to the Bank’s former Advantage Loan Program
The Company reported a net loss of
The Company reclassified approximately
“Sterling’s first quarter of 2023 results continue the very deliberate remediation and repositioning begun in 2020. As most are no doubt aware, we announced a settlement with the
Balance Sheet
Total Assets – Total assets were
Cash and due from banks increased
Total gross loans held for investment of
Total Deposits – Total deposits were
Capital – Total shareholders’ equity was
The Company and the Bank have elected to opt into the Community Bank Leverage Ratio framework, effective
Asset Quality and Provision for (Recovery of) Credit Losses – On
A provision for credit losses of
Net charge offs during the first quarter of 2023 were
There were no loans held for investment in nonaccrual status at
“We have accomplished much in strengthening our balance sheet since 2020, and we are now focused on building profitability. In that time, we have removed most of the wholesale funding liabilities, including all broker deposits and high interest rate time deposits, and built a very comprehensive risk management framework and culture. In the first quarter of 2023, we adopted CECL and successfully completed our first SOX-compliant audit,” said O’Brien.
Results of Operations
Net Interest Income and Net Interest Margin – Net interest income for the first quarter of 2023 was
The decrease in net interest income during the first quarter of 2023 compared to the first quarter of 2022 was primarily due to an increase in interest expense on our average balance of interest-bearing liabilities since the average rate paid increased 174 basis points. This was partially offset by an increase in interest income as the average yield on our average balance of interest-bearing assets increased 133 basis points. The average balance in our loan portfolio declined
The net interest margin of 2.93% for the first quarter of 2023 decreased from the net interest margin of 3.09% for the fourth quarter of 2022 and decreased from the net interest margin of 3.03% for the first quarter of 2022.
Non-Interest Income – Although non-interest income for the first quarter of 2023 was relatively flat compared to the fourth quarter of 2022, it reflected a decrease of
Non-Interest Expense – Non-interest expense of
Professional fees were
Income Tax Expense (Benefit)– For the three months ended
Mr. O’Brien said, “Of course, any discussion of early 2023 in the banking world would be lacking without a discussion of the collapse of
In all of that chaos, however, Sterling’s deposits held reasonably firm. In the first few days we had some minor account repositioning and some deposit amounts leave, while we also had some new money flow into the Bank. As of late April, our deposits levels were up over
Conference Call and Webcast
Management will host a conference call on
A replay of the conference call may be accessed through
About
Forward-Looking Statements
This press release contains certain statements that are, or may be deemed to be, “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, regarding the Company’s plans, expectations, thoughts, beliefs, estimates, goals and outlook for the future that are intended to be covered by the protections provided under the Private Securities Litigation Reform Act of 1995. These forward-looking statements reflect our current views with respect to, among other things, future events and our financial performance. These statements are often, but not always, made through the use of words or phrases such as “may,” “might,” “should,” “could,” “predict,” “potential,” “believe,” “expect,” “attribute,” “continue,” “will,” “anticipate,” “seek,” “estimate,” “intend,” “plan,” “projection,” “goal,” “target,” “outlook,” “aim,” “would” and “annualized,” or the negative versions of those words or other comparable words or phrases of a future or forward-looking nature. These forward-looking statements are not historical facts, and they are based on current expectations, estimates and projections about our industry, management's beliefs and certain assumptions made by management, many of which, by their nature, are inherently uncertain and beyond our control. Accordingly, we caution you that any such forward-looking statements are not guarantees of future performance and are subject to risks, assumptions, estimates and uncertainties that are difficult to predict. The risks, uncertainties and other factors detailed from time to time in our public filings, including those included in the disclosures under the headings “Cautionary Note Regarding Forward-Looking Statements” and “Risk Factors” in our Annual Report on Form 10-K filed with the
| Consolidated Financial Highlights (Unaudited) | ||||||||||||
| At and for the Three Months Ended | ||||||||||||
|
|
|
|
||||||||||
| (dollars in thousands, except per share data) |
2023 |
2022 |
2022 |
|||||||||
| Net income (loss) |
$ |
(503 |
) |
$ |
(18,433 |
) |
$ |
5,260 |
|
|||
| Income (loss) per share, diluted |
$ |
(0.01 |
) |
$ |
(0.37 |
) |
$ |
0.10 |
|
|||
| Net interest income |
$ |
17,676 |
|
$ |
18,521 |
|
$ |
21,272 |
|
|||
| Net interest margin |
|
2.93 |
% |
|
3.09 |
% |
|
3.03 |
% |
|||
| Non-interest income |
$ |
278 |
|
$ |
248 |
|
$ |
1,411 |
|
|||
| Non-interest expense |
$ |
17,837 |
|
$ |
37,110 |
|
$ |
19,423 |
|
|||
| Loans, net of allowance for credit losses |
$ |
1,513,481 |
|
$ |
1,613,385 |
|
$ |
1,822,186 |
|
|||
| Total deposits |
$ |
1,921,822 |
|
$ |
1,954,037 |
|
$ |
2,200,172 |
|
|||
| Asset Quality | ||||||||||||
| Nonperforming loans |
$ |
34 |
|
$ |
33,725 |
|
$ |
44,229 |
|
|||
| Allowance for credit losses to total loans |
|
2.48 |
% |
|
2.74 |
% |
|
2.80 |
% |
|||
| Allowance for credit losses to nonaccrual loans |
|
— |
|
|
135 |
% |
|
119 |
% |
|||
| Nonaccrual loans to total loans outstanding |
|
— |
|
|
2.03 |
% |
|
2.36 |
% |
|||
| Net charge offs (recoveries) to average loans outstanding during the period |
|
0.39 |
% |
|
(0.02 |
)% |
|
(0.01 |
)% |
|||
| Provision for (recovery of) credit losses |
$ |
674 |
|
$ |
(179 |
) |
$ |
(4,289 |
) |
|||
| Net charge offs (recoveries) |
$ |
6,412 |
|
$ |
(281 |
) |
$ |
(196 |
) |
|||
| Performance Ratios | ||||||||||||
| Return on average assets |
|
(0.08 |
)% |
|
(3.01 |
)% |
|
0.74 |
% |
|||
| Return on average shareholders' equity |
|
(0.65 |
)% |
|
(22.15 |
)% |
|
6.08 |
% |
|||
| Efficiency ratio (1) |
|
99.35 |
% |
|
197.72 |
% |
|
85.63 |
% |
|||
| Yield on average interest-earning assets |
|
4.88 |
% |
|
4.54 |
% |
|
3.55 |
% |
|||
| Cost of average interest-bearing liabilities |
|
2.36 |
% |
|
1.74 |
% |
|
0.62 |
% |
|||
| Net interest spread |
|
2.52 |
% |
|
2.80 |
% |
|
2.93 |
% |
|||
| Capital Ratios(2)(3) | ||||||||||||
| Regulatory and Other Capital Ratios — Consolidated: | ||||||||||||
| Tier 1 (core) capital to average total assets (leverage ratio) |
|
13.49 |
% |
|
13.54 |
% |
|
12.24 |
% |
|||
| Regulatory and Other Capital Ratios — Bank: | ||||||||||||
| Tier 1 (core) capital to average total assets (leverage ratio) |
|
16.52 |
% |
|
16.56 |
% |
|
13.65 |
% |
|||
| (1) Efficiency ratio is computed as the ratio of non-interest expense divided by the sum of net interest income and non-interest income. | ||||||||||||
| (2) |
||||||||||||
| (3) Effective |
||||||||||||
| Condensed Consolidated Balance Sheets (Unaudited) | ||||||||||||||||||
| % | % | |||||||||||||||||
| (dollars in thousands) |
2023 |
2022 |
change |
2022 |
change |
|||||||||||||
| Assets | ||||||||||||||||||
| Cash and due from banks |
$ |
419,219 |
|
$ |
379,798 |
|
10 |
% |
$ |
486,743 |
|
(14 |
)% |
|||||
| Interest-bearing time deposits with other banks |
|
934 |
|
|
934 |
|
0 |
% |
|
1,183 |
|
(21 |
)% |
|||||
| Debt securities available for sale |
|
342,534 |
|
|
343,558 |
|
(0 |
)% |
|
359,375 |
|
(5 |
)% |
|||||
| Equity securities |
|
4,712 |
|
|
4,642 |
|
2 |
% |
|
4,986 |
|
(5 |
)% |
|||||
| Loans held for sale |
|
37,979 |
|
|
7,725 |
|
N/M |
|
|
12,230 |
|
N/M |
|
|||||
| Loans, net of allowance for credit losses of |
|
1,513,481 |
|
|
1,613,385 |
|
(6 |
)% |
|
1,822,186 |
|
(17 |
)% |
|||||
| Accrued interest receivable |
|
7,617 |
|
|
7,829 |
|
(3 |
)% |
|
6,655 |
|
14 |
% |
|||||
| Mortgage servicing rights, net |
|
1,703 |
|
|
1,794 |
|
(5 |
)% |
|
2,888 |
|
(41 |
)% |
|||||
| Leasehold improvements and equipment, net |
|
6,139 |
|
|
6,301 |
|
(3 |
)% |
|
7,144 |
|
(14 |
)% |
|||||
| Operating lease right-of-use assets |
|
13,916 |
|
|
14,800 |
|
(6 |
)% |
|
17,210 |
|
(19 |
)% |
|||||
|
|
20,288 |
|
|
20,288 |
|
0 |
% |
|
20,288 |
|
0 |
% |
||||||
| Company-owned life insurance |
|
8,553 |
|
|
8,501 |
|
1 |
% |
|
33,163 |
|
(74 |
)% |
|||||
| Deferred tax asset, net |
|
20,065 |
|
|
23,704 |
|
(15 |
)% |
|
20,865 |
|
(4 |
)% |
|||||
| Other assets |
|
14,408 |
|
|
11,476 |
|
26 |
% |
|
14,213 |
|
1 |
% |
|||||
| Total assets |
$ |
2,411,548 |
|
$ |
2,444,735 |
|
(1 |
)% |
$ |
2,809,129 |
|
(14 |
)% |
|||||
| Liabilities | ||||||||||||||||||
| Noninterest-bearing deposits |
$ |
46,496 |
|
$ |
53,041 |
|
(12 |
)% |
$ |
64,944 |
|
(28 |
)% |
|||||
| Interest-bearing deposits |
|
1,875,326 |
|
|
1,900,996 |
|
(1 |
)% |
|
2,135,228 |
|
(12 |
)% |
|||||
| Total deposits |
|
1,921,822 |
|
|
1,954,037 |
|
(2 |
)% |
|
2,200,172 |
|
(13 |
)% |
|||||
|
|
50,000 |
|
|
50,000 |
|
0 |
% |
|
150,000 |
|
(67 |
)% |
||||||
| Subordinated notes, net |
|
65,253 |
|
|
65,271 |
|
(0 |
)% |
|
65,326 |
|
(0 |
)% |
|||||
| Operating lease liabilities |
|
15,089 |
|
|
15,990 |
|
(6 |
)% |
|
18,421 |
|
(18 |
)% |
|||||
| Accrued expenses and other liabilities |
|
43,874 |
|
|
46,810 |
|
(6 |
)% |
|
33,804 |
|
30 |
% |
|||||
| Total liabilities |
|
2,096,038 |
|
|
2,132,108 |
|
(2 |
)% |
|
2,467,723 |
|
(15 |
)% |
|||||
| Shareholders’ Equity | ||||||||||||||||||
| Preferred stock, authorized 10,000,000 shares; no shares issued and outstanding |
|
— |
|
|
— |
|
— |
|
|
— |
|
— |
|
|||||
| Common stock, no par value, authorized 500,000,000 shares; shares issued and outstanding 50,808,116 at |
|
83,295 |
|
|
83,295 |
|
0 |
% |
|
82,157 |
|
1 |
% |
|||||
| Additional paid-in capital |
|
14,906 |
|
|
14,808 |
|
1 |
% |
|
14,186 |
|
5 |
% |
|||||
| Retained earnings |
|
234,048 |
|
|
234,049 |
|
(0 |
)% |
|
253,503 |
|
(8 |
)% |
|||||
| Accumulated other comprehensive loss |
|
(16,739 |
) |
|
(19,525 |
) |
14 |
% |
|
(8,440 |
) |
(98 |
)% |
|||||
| Total shareholders’ equity |
|
315,510 |
|
|
312,627 |
|
1 |
% |
|
341,406 |
|
(8 |
)% |
|||||
| Total liabilities and shareholders’ equity |
$ |
2,411,548 |
|
$ |
2,444,735 |
|
(1 |
)% |
$ |
2,809,129 |
|
(14 |
)% |
|||||
| N/M - Not Meaningful | ||||||||||||||||||
| Condensed Consolidated Statements of Operations (Unaudited) | ||||||||||||||||||
| Three Months Ended | ||||||||||||||||||
| % | % | |||||||||||||||||
| (dollars in thousands, except per share amounts) |
2023 |
2022 |
change |
2022 |
change | |||||||||||||
| Interest income | ||||||||||||||||||
| Interest and fees on loans |
$ |
22,160 |
|
$ |
21,786 |
|
2 |
% |
$ |
23,868 |
|
(7 |
)% |
|||||
| Interest and dividends on investment securities and restricted stock |
|
2,456 |
|
|
2,293 |
|
7 |
% |
|
835 |
|
N/M |
|
|||||
| Other interest |
|
4,807 |
|
|
3,200 |
|
50 |
% |
|
215 |
|
N/M |
|
|||||
| Total interest income |
|
29,423 |
|
|
27,279 |
|
8 |
% |
|
24,918 |
|
18 |
% |
|||||
| Interest expense | ||||||||||||||||||
| Interest on deposits |
|
9,809 |
|
|
6,922 |
|
42 |
% |
|
2,330 |
|
N/M |
|
|||||
| Interest on |
|
245 |
|
|
250 |
|
(2 |
)% |
|
352 |
|
(30 |
)% |
|||||
| Interest on subordinated notes |
|
1,693 |
|
|
1,586 |
|
7 |
% |
|
964 |
|
76 |
% |
|||||
| Total interest expense |
|
11,747 |
|
|
8,758 |
|
34 |
% |
|
3,646 |
|
N/M |
|
|||||
| Net interest income |
|
17,676 |
|
|
18,521 |
|
(5 |
)% |
|
21,272 |
|
(17 |
)% |
|||||
| Provision for (recovery of) credit losses |
|
674 |
|
|
(179 |
) |
N/M |
|
|
(4,289 |
) |
N/M |
|
|||||
| Net interest income after provision for (recovery of) credit losses |
|
17,002 |
|
|
18,700 |
|
(9 |
)% |
|
25,561 |
|
(33 |
)% |
|||||
| Non-interest income | ||||||||||||||||||
| Service charges and fees |
|
94 |
|
|
84 |
|
12 |
% |
|
122 |
|
(23 |
)% |
|||||
| Gain (loss) on sale of investment securities |
|
(2 |
) |
|
32 |
|
N/M |
|
|
— |
|
N/M |
|
|||||
| Gain (loss) on sale of mortgage loans held for sale |
|
(25 |
) |
|
(57 |
) |
56 |
% |
|
197 |
|
N/M |
|
|||||
| Unrealized gain (loss) on equity securities |
|
71 |
|
|
10 |
|
N/M |
|
|
(236 |
) |
N/M |
|
|||||
| Net servicing income |
|
59 |
|
|
98 |
|
(40 |
)% |
|
443 |
|
(87 |
)% |
|||||
| Income earned on company-owned life insurance |
|
80 |
|
|
81 |
|
(1 |
)% |
|
328 |
|
(76 |
)% |
|||||
| Other |
|
1 |
|
|
— |
|
N/M |
|
|
557 |
|
(100 |
)% |
|||||
| Total non-interest income |
|
278 |
|
|
248 |
|
12 |
% |
|
1,411 |
|
(80 |
)% |
|||||
| Non-interest expense | ||||||||||||||||||
| Salaries and employee benefits |
|
9,410 |
|
|
8,985 |
|
5 |
% |
|
9,617 |
|
(2 |
)% |
|||||
| Occupancy and equipment |
|
2,112 |
|
|
2,216 |
|
(5 |
)% |
|
2,142 |
|
(1 |
)% |
|||||
| Professional fees |
|
3,221 |
|
|
5,929 |
|
(46 |
)% |
|
5,157 |
|
(38 |
)% |
|||||
|
|
257 |
|
|
115 |
|
N/M |
|
|
369 |
|
(30 |
)% |
||||||
| Data processing |
|
738 |
|
|
766 |
|
(4 |
)% |
|
805 |
|
(8 |
)% |
|||||
| Net provision for (recovery of) mortgage repurchase liability |
|
120 |
|
|
31 |
|
N/M |
|
|
(213 |
) |
N/M |
|
|||||
| Provision for contingent losses |
|
— |
|
|
18,239 |
|
(100 |
)% |
|
— |
|
N/M |
|
|||||
| Other |
|
1,979 |
|
|
829 |
|
N/M |
|
|
1,546 |
|
28 |
% |
|||||
| Total non-interest expense |
|
17,837 |
|
|
37,110 |
|
(52 |
)% |
|
19,423 |
|
(8 |
)% |
|||||
| Income (loss) before income taxes |
|
(557 |
) |
|
(18,162 |
) |
97 |
% |
|
7,549 |
|
N/M |
|
|||||
| Income tax expense (benefit) |
|
(54 |
) |
|
271 |
|
N/M |
|
|
2,289 |
|
N/M |
|
|||||
| Net income (loss) |
$ |
(503 |
) |
$ |
(18,433 |
) |
97 |
% |
$ |
5,260 |
|
N/M |
|
|||||
| Income (loss) per share, basic and diluted |
$ |
(0.01 |
) |
$ |
(0.37 |
) |
$ |
0.10 |
|
|||||||||
| Weighted average common shares outstanding: | ||||||||||||||||||
| Basic |
|
50,444,463 |
|
|
50,403,310 |
|
|
50,191,288 |
|
|||||||||
| Diluted |
|
50,444,463 |
|
|
50,403,310 |
|
|
50,406,123 |
|
|||||||||
| N/M - Not Meaningful | ||||||||||||||||||
| Yield Analysis and Net Interest Income (Unaudited) | |||||||||||||||||||||||||||
| Three Months Ended | |||||||||||||||||||||||||||
| (dollars in thousands) |
Average
|
Interest |
Average
|
|
Average
|
Interest |
Average
|
|
Average
|
Interest |
Average
|
||||||||||||||||
| Interest-earning assets | |||||||||||||||||||||||||||
| Loans(1) | |||||||||||||||||||||||||||
| Residential real estate and other consumer |
$ |
1,366,872 |
$ |
18,514 |
5.42 |
% |
$ |
1,428,840 |
$ |
18,331 |
5.13 |
% |
$ |
1,660,692 |
$ |
18,278 |
4.40 |
% |
|||||||||
| Commercial real estate |
|
223,929 |
|
2,596 |
4.64 |
% |
|
219,414 |
|
2,480 |
4.52 |
% |
|
247,044 |
|
3,436 |
5.56 |
% |
|||||||||
| Construction |
|
41,436 |
|
1,034 |
9.98 |
% |
|
45,486 |
|
957 |
8.42 |
% |
|
95,123 |
|
2,149 |
9.04 |
% |
|||||||||
| Commercial lines of credit |
|
1,382 |
|
16 |
4.63 |
% |
|
1,389 |
|
18 |
5.18 |
% |
|
350 |
|
5 |
5.71 |
% |
|||||||||
| Total loans |
|
1,633,619 |
|
22,160 |
5.43 |
% |
|
1,695,129 |
|
21,786 |
5.14 |
% |
|
2,003,209 |
|
23,868 |
4.77 |
% |
|||||||||
| Securities, includes restricted stock(2) |
|
366,346 |
|
2,456 |
2.68 |
% |
|
370,460 |
|
2,293 |
2.48 |
% |
|
350,150 |
|
835 |
0.95 |
% |
|||||||||
| Other interest-earning assets |
|
411,766 |
|
4,807 |
4.67 |
% |
|
335,237 |
|
3,200 |
3.82 |
% |
|
452,651 |
|
215 |
0.19 |
% |
|||||||||
| Total interest-earning assets |
|
2,411,731 |
|
29,423 |
4.88 |
% |
|
2,400,826 |
|
27,279 |
4.54 |
% |
|
2,806,010 |
|
24,918 |
3.55 |
% |
|||||||||
| Noninterest-earning assets | |||||||||||||||||||||||||||
| Cash and due from banks |
|
4,475 |
|
4,221 |
|
4,016 |
|||||||||||||||||||||
| Other assets |
|
28,398 |
|
28,432 |
|
43,322 |
|||||||||||||||||||||
| Total assets |
$ |
2,444,604 |
$ |
2,433,479 |
$ |
2,853,348 |
|||||||||||||||||||||
| Interest-bearing liabilities | |||||||||||||||||||||||||||
| Money market, savings and NOW |
$ |
1,001,505 |
$ |
4,614 |
1.87 |
% |
$ |
1,078,873 |
$ |
3,490 |
1.28 |
% |
$ |
1,310,848 |
$ |
707 |
0.22 |
% |
|||||||||
| Time deposits |
|
900,890 |
|
5,195 |
2.34 |
% |
|
799,524 |
|
3,432 |
1.70 |
% |
|
861,785 |
|
1,623 |
0.76 |
% |
|||||||||
| Total interest-bearing deposits |
|
1,902,395 |
|
9,809 |
2.09 |
% |
|
1,878,397 |
|
6,922 |
1.46 |
% |
|
2,172,633 |
|
2,330 |
0.43 |
% |
|||||||||
| FHLB borrowings |
|
50,000 |
|
245 |
1.96 |
% |
|
50,000 |
|
250 |
1.96 |
% |
|
150,000 |
|
352 |
0.94 |
% |
|||||||||
| Subordinated notes, net |
|
65,264 |
|
1,693 |
10.38 |
% |
|
65,283 |
|
1,586 |
9.51 |
% |
|
65,337 |
|
964 |
5.90 |
% |
|||||||||
| Total borrowings |
|
115,264 |
|
1,938 |
6.73 |
% |
|
115,283 |
|
1,836 |
6.23 |
% |
|
215,337 |
|
1,316 |
2.44 |
% |
|||||||||
| Total interest-bearing liabilities |
|
2,017,659 |
|
11,747 |
2.36 |
% |
|
1,993,680 |
|
8,758 |
1.74 |
% |
|
2,387,970 |
|
3,646 |
0.62 |
% |
|||||||||
| Noninterest-bearing liabilities | |||||||||||||||||||||||||||
| Demand deposits |
|
50,284 |
|
60,615 |
|
64,119 |
|||||||||||||||||||||
| Other liabilities |
|
63,308 |
|
49,036 |
|
55,479 |
|||||||||||||||||||||
| Shareholders' equity |
|
313,353 |
|
330,148 |
|
345,780 |
|||||||||||||||||||||
| Total liabilities and shareholders' equity |
$ |
2,444,604 |
$ |
2,433,479 |
$ |
2,853,348 |
|||||||||||||||||||||
| Net interest income and spread(2) |
$ |
17,676 |
2.52 |
% |
$ |
18,521 |
2.80 |
% |
$ |
21,272 |
2.93 |
% |
|||||||||||||||
| Net interest margin(2) |
2.93 |
% |
3.09 |
% |
3.03 |
% |
|||||||||||||||||||||
| (1) Nonaccrual loans are included in the respective average loan balances. Income, if any, on such loans is recognized on a cash basis. | |||||||||||||||||||||||||||
|
(2) Interest income does not include taxable equivalence adjustments. |
|||||||||||||||||||||||||||
| Loan Composition (Unaudited) | ||||||||||||||||||
| % | % | |||||||||||||||||
| (dollars in thousands) |
2023 |
2022 |
change |
2022 |
change | |||||||||||||
| Residential real estate |
$ |
1,289,554 |
|
$ |
1,391,276 |
|
(7 |
)% |
$ |
1,580,759 |
|
(18 |
)% |
|||||
| Commercial real estate |
|
224,792 |
|
|
221,669 |
|
1 |
% |
|
219,767 |
|
2 |
% |
|||||
| Construction |
|
36,255 |
|
|
44,503 |
|
(19 |
)% |
|
73,778 |
|
(51 |
)% |
|||||
| Commercial lines of credit |
|
1,368 |
|
|
1,396 |
|
(2 |
)% |
|
334 |
|
N/M |
|
|||||
| Other consumer |
|
77 |
|
|
5 |
|
N/M |
|
|
3 |
|
N/M |
|
|||||
| Total loans held for investment |
|
1,552,046 |
|
|
1,658,849 |
|
(6 |
)% |
|
1,874,641 |
|
(17 |
)% |
|||||
| Less: allowance for credit losses |
|
(38,565 |
) |
|
(45,464 |
) |
(15 |
)% |
|
(52,455 |
) |
(26 |
)% |
|||||
| Loans, net |
$ |
1,513,481 |
|
$ |
1,613,385 |
|
(6 |
)% |
$ |
1,822,186 |
|
(17 |
)% |
|||||
| Loans held for sale |
$ |
37,979 |
|
$ |
7,725 |
|
N/M |
|
$ |
12,230 |
|
N/M |
|
|||||
| Total gross loans |
$ |
1,590,025 |
|
$ |
1,666,574 |
|
(5 |
)% |
$ |
1,886,871 |
|
(16 |
)% |
|||||
| N/M - Not Meaningful |
|
|||||||||||||||||
| Allowance for Credit Losses (Unaudited) | ||||||||||||||||
| Three Months Ended | ||||||||||||||||
| (dollars in thousands) |
2023 |
2022 |
2022 |
|||||||||||||
| Balance at beginning of period |
$ |
45,464 |
|
$ |
45,362 |
|
$ |
56,548 |
|
|||||||
| Adjustment to Adopt ASU No. 2016-13 |
|
(1,651 |
) |
|
— |
|
|
— |
|
|||||||
| Adjustment to Adopt ASU No. 2022-02 |
|
380 |
|
|
— |
|
|
— |
|
|||||||
| Balance after adoption |
$ |
44,193 |
|
$ |
45,362 |
|
$ |
56,548 |
|
|||||||
| Provision for (recovery of) credit losses |
|
784 |
|
|
(179 |
) |
|
(4,289 |
) |
|||||||
| Charge offs |
|
(6,478 |
) |
|
— |
|
|
— |
|
|||||||
| Recoveries |
|
66 |
|
|
281 |
|
|
196 |
|
|||||||
| Balance at end of period |
$ |
38,565 |
|
$ |
45,464 |
|
$ |
52,455 |
|
|||||||
| Deposit Composition (Unaudited) | |||||||||||||||
| % | % | ||||||||||||||
| (dollars in thousands) |
2023 |
2022 |
change |
2022 |
change | ||||||||||
| Noninterest-bearing deposits |
$ |
46,496 |
$ |
53,041 |
(12 |
)% |
$ |
64,944 |
(28 |
)% |
|||||
| Money Market, Savings and NOW |
|
958,165 |
|
1,039,263 |
(8 |
)% |
|
1,319,444 |
(27 |
)% |
|||||
| Time deposits |
|
917,161 |
|
861,733 |
6 |
% |
|
815,784 |
12 |
% |
|||||
| Total deposits |
$ |
1,921,822 |
$ |
1,954,037 |
(2 |
)% |
$ |
2,200,172 |
(13 |
)% |
|||||
| Credit Quality Data (Unaudited) | ||||||||||||
| At and for the Three Months Ended | ||||||||||||
| (dollars in thousands) |
2023 |
2022 |
2022 |
|||||||||
| Nonaccrual loans(1): | ||||||||||||
| Residential real estate |
$ |
- |
|
$ |
33,690 |
|
$ |
38,300 |
|
|||
| Commercial |
|
— |
|
|
— |
|
|
5,891 |
|
|||
| Total nonaccrual loans(2) |
|
— |
|
|
33,690 |
|
|
44,191 |
|
|||
| Loans past due 90 days or more and still accruing interest |
|
34 |
|
|
35 |
|
|
38 |
|
|||
| Nonperforming loans |
|
34 |
|
|
33,725 |
|
|
44,229 |
|
|||
| Other troubled debt restructurings(3) |
|
— |
|
|
2,637 |
|
|
2,662 |
|
|||
| Nonaccrual loans held for sale |
|
26,270 |
|
|
1,942 |
|
|
7,249 |
|
|||
| Nonperforming assets |
$ |
26,304 |
|
$ |
38,304 |
|
$ |
54,140 |
|
|||
| Total loans (1) |
$ |
1,552,046 |
|
$ |
1,658,849 |
|
$ |
1,874,641 |
|
|||
| Total assets |
$ |
2,411,548 |
|
$ |
2,444,735 |
|
$ |
2,809,129 |
|
|||
| Nonaccrual loans to total loans outstanding (2) |
|
— |
|
|
2.03 |
% |
|
2.36 |
% |
|||
| Nonperforming assets to total assets |
|
1.09 |
% |
|
1.57 |
% |
|
1.93 |
% |
|||
| Allowance for credit losses to total loans |
|
2.48 |
% |
|
2.74 |
% |
|
2.80 |
% |
|||
| Allowance for credit losses to nonaccrual loans |
|
— |
|
|
135 |
% |
|
119 |
% |
|||
| Net charge offs (recoveries) to average loans outstanding during the period |
|
0.39 |
% |
|
(0.02 |
)% |
|
(0.01 |
)% |
|||
| (1) Loans are classified as held for investment and are presented before the allowance for credit losses. | ||||||||||||
| (2) Total nonaccrual loans exclude nonaccrual loans held for sale. If nonaccrual loans held for sale are included, the ratio of total nonaccrual loans to total gross loans would be 1.65%, 2.14% and 2.73% at |
||||||||||||
| (3) Other troubled debt restructurings at |
||||||||||||
View source version on businesswire.com: https://www.businesswire.com/news/home/20230501005147/en/
Investor Contact:
Executive Vice President and Chief Financial Officer
(248) 359-6624
kzaborney@sterlingbank.com
Source: