Capital Crossing Bank (NASDAQ:CAPX)
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From Jul 2019 to Jul 2024
Capital Crossing Bank (NASDAQ:CAPX) (the "Bank")
reported consolidated net income of $3.4 million, or $0.52 per diluted
share, for the third quarter of 2005, compared to consolidated net
income of $4.5 million, or $0.58 per diluted share, for the same
period in 2004.
The Bank also reported consolidated net income of $12.4 million,
or $1.78 per diluted share, for the nine months ended September 30,
2005, compared to consolidated net income of $13.9 million, or $1.78
per diluted share, for the same period in 2004.
Nicholas W. Lazares, the Bank's Chairman and Co-Chief Executive
Officer, stated, "We are pleased to report another strong quarter at
Capital Crossing Bank." Mr. Lazares further stated, "A significant
portion of the Bank's revenue arises from the recognition of
"transactional" income. In the third quarter of 2005, the Bank
recognized $7.7 million of transactional income, including $6.9
million of accelerated interest income associated with loan and lease
payoffs and $735,000 in net gains on sales of other real estate owned
and assets in possession. By contrast, in the third quarter of 2004,
the Bank recognized $7.3 million of transactional income. Total
transactional income for the nine months ended September 30, 2005 and
2004 amounted to $27.5 million and $24.3 million, respectively. Since
the level of transactional income is unpredictable from quarter to
quarter, the Bank's earnings may fluctuate significantly in the
future."
Richard Wayne, the Bank's President and Co-Chief Executive
Officer, explained that, "The volume of our loan acquisitions varies
from quarter-to-quarter depending upon market conditions. For example,
in the third quarter of 2005, we purchased loans with outstanding
principal balances of $31.7 million for a purchase price of $25.9
million, compared to the same period in 2004, when we purchased loans
with outstanding principal balances of $20.6 million for a purchase
price of $15.9 million. In the nine months ended September 30, 2005,
we purchased loans with outstanding principal balances of $131.3
million for a purchase price of $111.9 million, compared to the same
period in 2004, when we purchased loans with outstanding principal
balances of $204.0 million for a purchase price of $183.5 million."
Included in our loan acquisitions for the nine months ended September
30, 2004, were $89.8 million of high quality residential loans that
were acquired for a purchase price of $88.1 million. Although
residential loan portfolios were available for purchase in the nine
months ended September 30, 2005, management elected not to bid on or
purchase such loans at the offered pricing levels. Mr. Wayne
continued, "During the course of our review of available loan
portfolios, we will, in some cases, decline to bid on a portfolio
after analyzing the results of our due diligence review, or, in other
instances, be outbid by other purchasers. We simply cannot predict how
often we will successfully acquire a loan portfolio."
Mr. Wayne further stated, "Our total non-performing assets
decreased $7.7 million from $39.7 million at December 31, 2004 to
$32.0 million at September 30, 2005. While a substantial majority of
the loan and leases we have acquired in recent years have been
performing, we have also acquired appropriately priced non-performing
loans and leases. At September 30, 2005, we held loans and leases with
net investment balances of $14.0 million which were acquired as
non-performing. In the past, our pricing strategy and the level of
discount we obtain on such loans and leases has enabled us to, over
time, realize significant levels of transactional income from these
assets."
During the third quarter of 2005, the Bank's leasing subsidiary,
Dolphin Capital Corp., originated leases with an aggregate investment
balance of $15.5 million, compared to the same period in 2004 when it
originated or acquired leases with an aggregate investment balance of
$18.2 million. During the nine months ended September 30, 2005,
Dolphin Capital originated leases with an aggregate investment balance
of $45.6 million compared to the same period in 2004 when it
originated or acquired leases with an aggregate investment balance of
$41.7 million. Dolphin Capital Corp.'s net income was $1.6 million for
the nine months ended September 30, 2005, compared to $1.8 million for
the same period in 2004 and $264,000 for the third quarter in 2005,
compared to $523,000 for the same period in 2004.
The Bank continued to repurchase shares of its common stock under
its common stock repurchase program during the third quarter of 2005.
As of September 30, 2005, the Bank had repurchased 6,842,832 shares
under its current repurchase program and previous repurchase programs
at an average purchase price of $12.58 per share, and had an
additional $5.9 million to invest under its current repurchase
program. The Bank initiated its first repurchase program in August
2000.
Investors and interested parties will have the opportunity to
listen to management's discussion of the Bank's quarterly and nine
month results in a conference call to be held on Tuesday, October 25th
at 9:00 a.m., Eastern Time. The conference call will be broadcast over
the investor relations page of the Bank's website at
www.capitalcrossing.com. For those who cannot listen to the live
broadcast, an audio replay of the call will be available on the
website or via telephone at 888-203-1112, access code #8140513. A
replay of the call will be available beginning at approximately 11:00
a.m. on October 25, 2005 through midnight on October 31, 2005.
This press release contains a number of forward-looking statements
concerning the Bank's current expectations as to future growth and its
results of operations. Any statements that are not statements of
historical fact (including statements containing the words "believes,"
"plans," "anticipates," "expects," "estimates," "intends," "may,"
"projects," "will," "would," and similar expressions) should also be
considered to be forward-looking statements. There are a number of
important factors that could cause actual results or events to differ
materially from those indicated by such forward-looking statements,
including: the Bank's ability to successfully acquire loans at the
same volume and the same yields as it has historically, changes in
interest rates that adversely affect its business, the level of
transactional income realized by the Bank as a result of loan and
lease payoffs and the sale of real estate and loans, the Bank's
ability to successfully diversify its asset base, the level of the
Bank's non-performing assets, the Bank's ability to successfully
conduct its leasing business, general economic conditions in the
Bank's markets, as well as those other factors detailed under the
caption "Certain Factors That May Affect Future Results" in the Bank's
Quarterly Report on Form 10-Q for the period ended June 30, 2005,
which important factors are incorporated herein by this reference. The
Bank disclaims any intention or obligation to update any
forward-looking statements as a result of developments occurring after
the date of this press release.
Capital Crossing Bank is a Massachusetts-chartered, FDIC-insured
trust company with $1.1 billion in assets as of September 30, 2005.
The Bank operates as a commercial bank, providing financial products
and services to customers through its executive and main offices in
Boston, its website at www.capitalcrossing.com, and through its
leasing subsidiary Dolphin Capital Corp. located in Moberly, Missouri.
The Bank is a value oriented investor in whole loans and loan
portfolios generally secured by commercial, multi-family and
one-to-four family residential real estate and other business assets.
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Capital Crossing Bank and Subsidiaries
Consolidated Financial Highlights
(Unaudited)
September 30, December 31,
2005 2004
------------ ------------
(dollars in thousands,
except per share data)
Total assets $1,066,753 $1,082,224
Loans and leases: 955,922 1,005,665
Non-accretable discount (41,847) (47,042)
Accretable discount (77,093) (80,399)
Allowance for loan and lease losses (16,682) (21,037)
Net deferred loan and lease income (17,836) (16,326)
----------- -----------
Loans and leases, net 802,464 840,861
----------- -----------
Short-term investments 112,187 60,353
Securities available for sale 91,773 115,417
Deposits 686,684 727,874
Borrowed funds 219,927 176,079
REIT preferred stock 64,758 64,761
Stockholders' equity 76,503 91,355
Non-performing assets:
Other real estate owned, net 5,952 7,567
Other assets in possession, net 266 1,163
Non-performing loans and leases:
Loans and leases acquired as non-
performing 13,952 21,213
Loans and leases that became non-
performing subsequent to
acquisition 11,852 9,761
----------- -----------
Total non-performing assets,
net 32,022 39,704
----------- -----------
Total non-performing assets, net as a
percent to total assets 3.00 % 3.67 %
Allowance for loan and lease losses as a
percent of loans and leases, net of
discount and deferred income 2.04 2.44
Allowance for loan and lease losses as a
percent of net non-performing loans and
leases 64.65 67.92
Book value per common share $14.28 $14.96
Tangible book value per common share 13.46 14.24
Shares outstanding, net 5,358,667 6,108,114
Capital Crossing Bank and Subsidiaries
Consolidated Operating Results and Related Financial Data
(Unaudited)
Three Months Nine Months
Ended Ended
September 30, September 30,
----------------- -----------------
2005 2004 2005 2004
-------- -------- -------- --------
(in thousands, except per share
data)
Interest income - regularly
scheduled $18,648 $18,290 $55,125 $51,462
Interest income - accelerated 6,921 6,520 19,031 20,812
-------- -------- -------- --------
Total interest income 25,569 24,810 74,156 72,274
Interest expense (9,555) (8,002) (26,665) (22,689)
-------- -------- -------- --------
Net interest income 16,014 16,808 47,491 49,585
Credit (provision) for loan and
lease losses 688 63 2,238 2,103
-------- -------- -------- --------
Net interest income, after credit
(provision) for loan and lease
losses 16,702 16,871 49,729 51,688
Gain on sales of loans, net - 437 - 2,172
Other income 394 499 1,217 1,498
Operating expenses:
Other real estate owned and
assets in possession income,
net 481 357 7,824 737
Other operating expenses (9,631) (9,037) (31,252) (28,028)
-------- -------- -------- --------
Total operating expenses (9,150) (8,680) (23,428) (27,291)
-------- -------- -------- --------
Income before income taxes, minority
interest and dividends on REIT
preferred stock 7,946 9,127 27,518 28,067
Provision for income taxes (3,497) (3,708) (12,219) (11,908)
Minority interest, net of taxes (99) (19) (154) (107)
Dividends on REIT preferred stock,
net of taxes (927) (928) (2,781) (2,126)
-------- -------- -------- --------
Net income $3,423 $4,472 $12,364 $13,926
======== ======== ======== ========
Weighted average shares
outstanding:
Basic 5,458 6,563 5,760 6,632
Diluted 6,635 7,718 6,933 7,828
Earnings per share:
Basic $0.63 $0.68 $2.15 $2.10
Diluted 0.52 0.58 1.78 1.78
Financial ratios (annualized):
Return on average assets 1.32% 1.56% 1.60% 1.80%
Return on average
stockholders' equity 17.10% 18.19% 19.39% 19.59%
Transactional income:
Interest and fee income on loan
and lease pay-offs
Non-accretable discount $1,788 $3,374 $7,736 $9,261
Accretable discount 3,114 1,792 7,330 8,361
Other interest income 2,019 1,354 3,965 3,190
-------- -------- -------- --------
Total interest and
fee income on loan
and lease pay-offs 6,921 6,520 19,031 20,812
Gain on sale of loans,
net - 437 - 2,172
Gain on sale of other
real estate owned and
assets in possession,
net 735 316 8,468 1,296
-------- -------- -------- --------
Total
transactional
income $7,656 $7,273 $27,499 $24,280
======== ======== ======== ========
Capital Crossing Bank and Subsidiaries
Interest Rate and Loan and Lease Volume Analysis
(Unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
------------------- ---------------------
2005 2004 2005 2004
--------- --------- ---------- ----------
(dollars in thousands)
Weighted average yield/rate
(annualized):
Short-term investments 3.45 % 1.49 % 2.97 % 1.21 %
Securities available for
sale 4.62 3.51 4.68 3.49
Loan and lease
portfolio, net 11.71 11.22 11.35 11.95
Total interest-
earning assets 10.34 % 9.09 % 10.16 % 9.75 %
Interest bearing
liabilities 4.40 % 3.35 % 4.14 % 3.49 %
Interest rate spread 5.94 % 5.74 % 6.02 % 6.26 %
Net interest margin 6.48 % 6.16 % 6.51 % 6.69 %
Loan and lease volume:
Loan originations $- $- $508 $1,000
Loan acquisitions
Loan balances 31,723 20,644 131,348 204,022
(Discount) premium,
net (5,796) (4,716) (19,477) (20,497)
-------- -------- --------- ---------
Loan
acquisitions,
net 25,927 15,928 111,871 183,525
-------- -------- --------- ---------
Total
loan
volume 25,927 15,928 112,379 184,525
-------- -------- --------- ---------
Lease originations 15,530 12,262 45,600 34,702
Lease acquisitions, net - 5,937 - 6,960
-------- -------- --------- ---------
Total lease volume 15,530 18,199 45,600 41,662
-------- -------- --------- ---------
Total
loan and
lease
volume,
net $41,457 $34,127 $157,979 $226,187
======== ======== ========= =========
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