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Share Name | Share Symbol | Market | Type |
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Signature Bank | NASDAQ:SBNY | NASDAQ | Common Stock |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
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0.00 | 0.00% | 70.00 | 77.00 | 3.00 | 0 | 01:00:00 |
Signature Bank (Nasdaq: SBNY), a New York-based full-service commercial bank, today announced results for its third quarter ended September 30, 2018. Net income for the 2018 third quarter was $155.4 million, or $2.84 diluted earnings per share, versus $124.5 million, or $2.29 diluted earnings per share, for the 2017 third quarter. The increase in net income for the 2018 third quarter, versus the comparable quarter last year, is primarily due to an increase in net interest income and a decrease in the provision for loan losses and income tax expense.
Net interest income for the 2018 third quarter reached $324.8 million, up $16.0 million, or 5.2 percent, when compared with the 2017 third quarter. This increase is primarily due to growth in average interest-earning assets. Total assets reached $45.87 billion at September 30, 2018, an increase of $4.54 billion, or 11.0 percent, from $41.33 billion at September 30, 2017. Average assets for the 2018 third quarter reached $45.48 billion, an increase of $4.60 billion, or 11.3 percent, compared with the 2017 third quarter.
Deposits for the 2018 third quarter rose $1.10 billion, or 3.1 percent, to $36.09 billion at September 30, 2018. When compared with deposits at September 30, 2017, overall deposit growth for the last twelve months was 7.2 percent, or $2.41 billion. Average deposits for the 2018 third quarter reached $35.78 billion, an increase of $1.27 billion, or 3.7 percent.
“During the past few quarters, Signature Bank has executed several growth initiatives paving the way for the future direction of this institution. These strategies include taking our successful single-point-of-contact model outside of the metro-New York area -- where we spent 17 years building the foundation of our business -- and bringing it to San Francisco after we identified a glaring need. In the 2018 first quarter, we appointed a digital asset banking team because we want to be nimble and ready to change as the market evolves. Just recently, we hired a nine-person team focusing on capital call and subscription finance for private equity firms. And lastly, we have been heavily investing in our infrastructure with the implementation of new systems for loan operations (now in place), credit approvals and foreign exchange as well as an enhanced payments platform,” explained Joseph J. DePaolo, President and Chief Executive Officer.
“Our success since our founding in 2001 is predicated on our ability to attract seasoned bankers who serve as client contacts for all banking needs. This client-centric philosophy is at the crux of all we do. The advancements we are making are all accomplished with client satisfaction at their core. At the same time, we are expanding our reach in new business activities, geography and capabilities. We must take measured risks to fuel future growth, but they are far less than the long-range risks of comfortable inaction. We believe the initiatives upon which we are embarking today will set the stage for the Signature Bank of tomorrow,” DePaolo concluded.
Scott A. Shay, Chairman of the Board, said: “Signature Bank has grown into the 40th largest bank in the U.S., without performing any mergers or acquisitions. Instead, we built our business methodically and organically -- banker by banker -- partnering with those individuals who attract, build and nurture an expansive portfolio of loyal banking clients. We are proud that even after 17+ years in operation, we are still the bank of choice amongst veteran bankers who are passionate about delivering best-in-class service to clients. Every team we attract brings along an unwavering commitment to catering to clients.”
“While we recognize the maxim that ‘what got you here, won't get you there,’ we are constantly on the lookout for new ideas adjacent to our business strategy, including those we can thoughtfully expand upon and which allow us to continue to execute on our service hallmark. This is evidenced by our recent San Francisco expansion. We also recognize that banking and payment technologies are rapidly advancing, and are focused on incorporating evolving technologies relevant to our clients’ needs. While the banking landscape always seems to be increasingly more competitive and challenging, Signature Bank remains stable and at the forefront of both thought- and action-based leadership that positively influences the success of clients,” Shay stated.
Capital
The Bank’s Tier 1 leverage, common equity Tier 1 risk-based, Tier 1 risk-based, and total risk-based capital ratios were approximately 9.67 percent, 12.13 percent, 12.13 percent, and 13.44 percent, respectively, as of September 30, 2018. Each of these ratios is well in excess of regulatory requirements. The Bank’s strong risk-based capital ratios reflect the relatively low risk profile of the Bank’s balance sheet. The Bank’s tangible common equity ratio remains strong at 9.15 percent. The Bank defines tangible common equity ratio as the ratio of total tangible common shareholders’ equity to total tangible assets.
The Bank declared a cash dividend of $0.56 per share, payable on or after November 15, 2018 to common stockholders of record at the close of business on November 1, 2018. In the third quarter of 2018, the Bank paid a cash dividend of $0.56 per share to common stockholders of record at the close of business on August 1, 2018.
Net Interest Income
Net interest income for the 2018 third quarter was $324.8 million, an increase of $16.0 million, or 5.2 percent, versus the same period last year, primarily due to growth in average interest-earning assets. Average interest-earning assets of $44.86 billion for the 2018 third quarter represent an increase of $4.56 billion, or 11.3 percent, from the 2017 third quarter. Yield on interest-earning assets for the 2018 third quarter increased 19 basis points, to 3.85 percent, compared with the 2017 third quarter.
Average cost of deposits and average cost of funds for the third quarter of 2018 increased by 33 and 39 basis points, to 0.88 percent and 1.06 percent, respectively versus the comparable period a year ago.
Net interest margin on a tax-equivalent basis for the 2018 third quarter was 2.88 percent versus 3.05 percent reported in the same period a year ago. On a linked quarter basis, net interest margin on a tax-equivalent basis decreased six basis points. Excluding loan prepayment penalties in both quarters, linked quarter core net interest margin on a tax-equivalent basis decreased four basis points to 2.85 percent.
Provision for Loan Losses
The Bank’s provision for loan losses for the third quarter of 2018 was $7.4 million, compared with $8.0 million for the 2018 second quarter and $14.3 million for the 2017 third quarter.
Net charge-offs for the 2018 third quarter were $11,000, or less than one basis point of average loans on an annualized basis, versus $3.0 million, or 0.04 percent, for the 2018 second quarter and $3.8 million, or 0.05 percent, for the 2017 third quarter.
Non-Interest Income and Non-Interest Expense
Non-interest income for the 2018 third quarter was $4.5 million, down $3.6 million when compared with $8.1 million reported in the 2017 third quarter. The decrease was primarily due to a $4.0 million increase in tax credit investment amortization. These investments positively impact our effective tax rate.
Non-interest expense for the third quarter of 2018 was $117.2 million, an increase of $11.6 million, or 11.0 percent, versus $105.6 million reported in the 2017 third quarter. The increase was primarily a result of the addition of new private client banking teams, as well as an increase in costs in our risk management and compliance related activities.
The Bank’s efficiency ratio was 35.6 percent for the 2018 third quarter versus 33.3 percent for the comparable period last year and 34.5 percent for the 2018 second quarter.
Loans
Loans, excluding loans held for sale, grew $979.7 million, or 2.9 percent, during the third quarter of 2018 to $35.13 billion, compared with $34.15 billion at June 30, 2018. At September 30, 2018, loans accounted for 76.6 percent of total assets, versus 75.5 percent at the end of both the 2018 second quarter and the 2017 third quarter. Average loans, excluding loans held for sale, reached $34.53 billion in the 2018 third quarter, growing $854.4 million, or 2.5 percent, from the 2018 second quarter and $3.84 billion, or 12.5 percent, from the 2017 third quarter. The increase in loans for the quarter was primarily driven by growth in specialty finance, commercial real estate and multi-family loans.
At September 30, 2018, non-accrual loans were $134.2 million, representing 0.38 percent of total loans and 0.29 percent of total assets, compared with non-accrual loans of $158.1 million, or 0.46 percent of total loans, at June 30, 2018 and $376.9 million, or 1.21 percent of total loans, at September 30, 2017. Excluding non-accruing loans secured by taxi medallions of $111.7 million, non-accrual loans for the remainder of the entire portfolio are $22.5 million, or six basis points of total loans. At September 30, 2018, the ratio of allowance for loan and lease losses to total loans was 0.63 percent, versus 0.62 percent for June 30, 2018 and September 30, 2017. Additionally, the ratio of allowance for loan and lease losses to non-accrual loans, or the coverage ratio, was 164 percent for the 2018 third quarter versus 135 percent for the second quarter of 2018 and 51 percent for the 2017 third quarter.
Conference Call
Signature Bank’s management will host a conference call to review results of the 2018 third quarter on Thursday, October 18, 2018, at 10:00 AM ET. All participants should dial 866-359-8135 at least ten minutes prior to the start of the call and reference conference ID #1869699. International callers should dial 901-300-3484.
To hear a live web simulcast or to listen to the archived web cast following completion of the call, please visit the Bank’s web site at www.signatureny.com, click on "Investor Information," then, under "Company News," select "Conference Calls" to access the link to the call. To listen to a telephone replay of the conference call, please dial 800-585-8367 or 404-537-3406 and enter conference ID #1869699. The replay will be available from approximately 1:00 PM ET on Thursday, October 18, 2018 through 11:59 PM ET on Monday, October 22, 2018.
About Signature Bank
Signature Bank, member FDIC, is a New York-based full-service commercial bank with 30 private client offices throughout the New York metropolitan area, including those in Manhattan, Brooklyn, Westchester, Long Island, Queens, the Bronx, Staten Island and Connecticut. In 2018, the Bank expanded its footprint on the West Coast with the opening of its first full-service private client banking office in San Francisco. The Bank’s growing network of private client banking teams serves the needs of privately owned businesses, their owners and senior managers.
Signature Bank’s specialty finance subsidiary, Signature Financial, LLC, provides equipment finance and leasing. Signature Securities Group Corporation, a wholly owned Bank subsidiary, is a licensed broker-dealer, investment adviser and member FINRA/SIPC, offering investment, brokerage, asset management and insurance products and services.
Signature Bank is ranked the 40th largest bank in the U.S. from nearly 6,000, based on deposits (SNL Financial). The Bank recently earned several third-party recognitions, including: appeared on Forbes' Best Banks in America list for the eighth consecutive year in 2018; named Best Business Bank, Best Private Bank and Best Attorney Escrow Services provider by the New York Law Journal in the publication’s annual “Best of” survey for 2018, earning it a place in the New York Law Journal’s Hall of Fame, awarded to companies that have ranked in the “Best of” Survey for at least three of the past four years.
For more information, please visit www.signatureny.com.
This press release and oral statements made from time to time by our representatives contain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 that are subject to risks and uncertainties. You should not place undue reliance on those statements because they are subject to numerous risks and uncertainties relating to our operations and business environment, all of which are difficult to predict and may be beyond our control. Forward-looking statements include information concerning our future results, interest rates and the interest rate environment, loan and deposit growth, loan performance, operations, new private client teams and other hires, new office openings and business strategy. These statements often include words such as "may," "believe," "expect," "anticipate," "intend," “potential,” “opportunity,” “could,” “project,” “seek,” “should,” “will,” “would,” "plan," "estimate" or other similar expressions. As you consider forward-looking statements, you should understand that these statements are not guarantees of performance or results. They involve risks, uncertainties and assumptions that could cause actual results to differ materially from those in the forward-looking statements and can change as a result of many possible events or factors, not all of which are known to us or in our control. These factors include but are not limited to: (i) prevailing economic conditions; (ii) changes in interest rates, loan demand, real estate values and competition, any of which can materially affect origination levels and gain on sale results in our business, as well as other aspects of our financial performance, including earnings on interest-bearing assets; (iii) the level of defaults, losses and prepayments on loans made by us, whether held in portfolio or sold in the whole loan secondary markets, which can materially affect charge-off levels and required credit loss reserve levels; (iv) changes in monetary and fiscal policies of the U.S. Government, including policies of the U.S. Treasury and the Board of Governors of the Federal Reserve System; (v) changes in the banking and other financial services regulatory environment and (vi) competition for qualified personnel and desirable office locations. Although we believe that these forward-looking statements are based on reasonable assumptions, beliefs and expectations, if a change occurs or our beliefs, assumptions and expectations were incorrect, our business, financial condition, liquidity or results of operations may vary materially from those expressed in our forward-looking statements. Additional risks are described in our quarterly and annual reports filed with the FDIC. You should keep in mind that any forward-looking statements made by Signature Bank speak only as of the date on which they were made. New risks and uncertainties come up from time to time, and we cannot predict these events or how they may affect the Bank. Signature Bank has no duty to, and does not intend to, update or revise the forward-looking statements after the date on which they are made. In light of these risks and uncertainties, you should keep in mind that any forward-looking statement made in this release or elsewhere might not reflect actual results.
SIGNATURE BANK CONSOLIDATED STATEMENTS OF INCOME (unaudited)Three months endedSeptember 30,
Nine months endedSeptember 30,
(dollars in thousands, except per share amounts) 2018 2017 2018 2017 INTEREST AND DIVIDEND INCOME Loans held for sale $ 2,442 911 8,205 3,155 Loans and leases, net 351,743 301,561 1,011,765 875,028 Securities available-for-sale 58,381 49,986 165,073 150,653 Securities held-to-maturity 14,394 14,549 43,437 44,346 Other investments 7,268 3,662 19,623 10,030 Total interest income 434,228 370,669 1,248,103 1,083,212 INTEREST EXPENSE Deposits 79,200 46,659 199,264 121,772Federal funds purchased and securities sold under agreements to repurchase
2,519 1,913 7,909 7,329 Federal Home Loan Bank borrowings 24,068 9,634 66,048 25,407 Subordinated debt 3,645 3,645 10,928 10,890 Total interest expense 109,432 61,851 284,149 165,398 Net interest income before provision for loan and lease losses 324,796 308,818 963,954 917,814 Provision for loan and lease losses 7,351 14,340 156,083 221,560 Net interest income after provision for loan and lease losses 317,445 294,478 807,871 696,254 NON-INTEREST INCOME Commissions 3,249 3,036 9,704 9,094 Fees and service charges 6,914 6,112 20,708 18,127 Net gains on sales of securities 12 735 810 3,263 Net gains on sales of loans 1,931 2,204 5,133 6,657 Other-than-temporary impairment losses on securities: Total impairment losses on securities - (361 ) (2 ) (634 ) Portion recognized in other comprehensive income (before taxes) - - (14 ) 32 Net impairment losses on securities recognized in earnings - (361 ) (16 ) (602 ) Tax credit investment amortization (8,369 ) (4,388 ) (21,654 ) (11,523 ) Other Income 806 781 2,675 2,527 Total non-interest income 4,543 8,119 17,360 27,543 NON-INTEREST EXPENSE Salaries and benefits 76,140 70,112 225,023 204,856 Occupancy and equipment 8,638 8,210 25,172 24,280 Information technology 6,083 5,970 18,661 16,743 FDIC assessment fees 7,070 7,260 21,504 20,242 Professional fees 3,307 3,181 10,086 9,222 Other general and administrative 15,970 10,895 66,689 49,756 Total non-interest expense 117,208 105,628 367,135 325,099 Income before income taxes 204,780 196,969 458,096 398,698 Income tax expense 49,334 72,498 113,594 126,354 Net income $ 155,446 124,471 344,502 272,344 PER COMMON SHARE DATA Earnings per share – basic $ 2.84 2.30 6.32 5.05 Earnings per share – diluted $ 2.84 2.29 6.30 5.01 Dividends per common share $ 0.56 - 0.56 - SIGNATURE BANK CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION September 30, December 31, 2018 2017 (dollars in thousands, except shares and per share amounts) (unaudited) ASSETS Cash and due from banks $ 155,791 290,078 Short-term investments 39,613 45,388 Total cash and cash equivalents 195,404 335,466 Securities available-for-sale 7,220,219 6,953,719Securities held-to-maturity (fair value $1,829,462 at September 30, 2018 and $1,983,087 at December 31, 2017)
1,903,343 1,996,376 Federal Home Loan Bank stock 230,677 227,920 Loans held for sale 502,915 432,277 Loans and leases, net 34,906,505 32,416,580 Premises and equipment, net 69,062 61,571 Accrued interest and dividends receivable 133,527 117,070 Other assets 709,058 576,741 Total assets $ 45,870,710 43,117,720 LIABILITIES AND SHAREHOLDERS' EQUITY Deposits Non-interest-bearing $ 12,158,738 11,353,038 Interest-bearing 23,932,487 22,086,789 Total deposits 36,091,225 33,439,827Federal funds purchased and securities sold under agreements to repurchase
575,000 790,000 Federal Home Loan Bank borrowings 4,210,000 4,195,000 Subordinated debt 257,974 257,381 Accrued expenses and other liabilities 498,514 403,821 Total liabilities 41,632,713 39,086,029 Shareholders’ equity Preferred stock, par value $.01 per share; 61,000,000 shares authorized; none issued at September 30, 2018 and December 31, 2017 - - Common stock, par value $.01 per share; 64,000,000 shares authorized; 55,384,378 shares issued and 55,383,361 outstanding at September 30, 2018; 54,979,213 shares issued and 54,977,971 outstanding at December 31, 2017 554 550 Additional paid-in capital 1,848,624 1,809,642 Retained earnings 2,601,073 2,290,537 Treasury stock, 1,017 shares at September 30, 2018 and 1,242 shares at December 31, 2017 (113 ) (171 ) Accumulated other comprehensive loss (212,141 ) (68,867 ) Total shareholders' equity 4,237,997 4,031,691 Total liabilities and shareholders' equity $ 45,870,710 43,117,720 SIGNATURE BANK FINANCIAL SUMMARY, CAPITAL RATIOS, ASSET QUALITY (unaudited)Three months endedSeptember 30,
Nine months endedSeptember 30,
(in thousands, except ratios and per share amounts) 2018 2017 2018 2017 PER COMMON SHARE Net income - basic $ 2.84 $ 2.30 $ 6.32 $ 5.05 Net income - diluted $ 2.84 $ 2.29 $ 6.30 $ 5.01 Average shares outstanding - basic 54,544 54,098 54,406 53,968 Average shares outstanding - diluted 54,610 54,300 54,646 54,349 Book value $ 76.52 $ 71.52 $ 76.52 $ 71.52 SELECTED FINANCIAL DATA Return on average total assets 1.36 % 1.21 % 1.03 % 0.90 % Return on average shareholders' equity 14.71 % 12.78 % 11.14 % 9.65 % Efficiency ratio (1) 35.59 % 33.33 % 37.41 % 34.39 % Yield on interest-earning assets 3.84 % 3.65 % 3.80 % 3.65 % Yield on interest-earning assets, tax-equivalent basis (1)(2) 3.85 % 3.66 % 3.81 % 3.66 % Cost of deposits and borrowings 1.06 % 0.67 % 0.95 % 0.61 % Net interest margin 2.87 % 3.04 % 2.93 % 3.09 % Net interest margin, tax-equivalent basis (2)(3) 2.88 % 3.05 % 2.94 % 3.10 % (1) See "Non-GAAP Financial Measures" for related calculation. (2) Based on the 21 percent U.S. federal statutory tax rate for the 2018 periods presented, and the 35 percent rate for the 2017 periods presented. The tax-equivalent basis is considered a non-GAAP financial measure and should be considered in addition to, not as a substitute for or superior to, financial measures determined in accordance with GAAP. This ratio is a metric used by management to evaluate the impact of tax-exempt assets on the Bank's yield on interest-earning assets and net interest margin. (3) See "Net Interest Margin Analysis" for related calculation.September 30,2018
June 30,2018
December 31,2017
September 30,2017
CAPITAL RATIOS Tangible common equity (4) 9.15 % 9.10 % 9.29 % 9.44 % Tier 1 leverage (5) 9.67 % 9.64 % 9.72 % 9.72 % Common equity Tier 1 risk-based (5) 12.13 % 12.10 % 11.99 % 11.96 % Tier 1 risk-based (5) 12.13 % 12.10 % 11.99 % 11.96 % Total risk-based (5) 13.44 % 13.42 % 13.32 % 13.32 % ASSET QUALITY Non-accrual loans $ 134,197 $ 158,077 $ 326,918 $ 376,867 Allowance for loan and lease losses $ 220,706 $ 213,367 $ 195,959 $ 193,040 Allowance for loan and lease losses to non-accrual loans 164.46 % 134.98 % 59.94 % 51.22 % Allowance for loan and lease losses to total loans 0.63 % 0.62 % 0.60 % 0.62 % Non-accrual loans to total loans 0.38 % 0.46 % 1.00 % 1.21 % Quarterly net charge-offs to average loans, annualized 0.00 % 0.04 % 0.48 % 0.05 % (4) We define tangible common equity as the ratio of total tangible common equity to total tangible assets (the "TCE ratio"). Tangible common equity is considered to be a non-GAAP financial measure and should be considered in addition to, not as a substitute for or superior to, financial measures determined in accordance with GAAP. The TCE ratio is a metric used by management to evaluate the adequacy of our capital levels. In addition to tangible common equity, management uses other metrics, such as Tier 1 capital related ratios, to evaluate capital levels. See "Non-GAAP Financial Measures" for related calculation. (5) September 30, 2018 ratios are preliminary. SIGNATURE BANK NET INTEREST MARGIN ANALYSIS (unaudited) Three months ended Three months ended September 30, 2018 September 30, 2017 (dollars in thousands)AverageBalance
InterestIncome/Expense
AverageYield/Rate
AverageBalance
InterestIncome/Expense
AverageYield/Rate
INTEREST-EARNING ASSETS Short-term investments $ 485,749 2,488 2.03 % 470,171 1,455 1.23 % Investment securities 9,526,123 77,555 3.26 % 8,987,262 66,742 2.97 % Commercial loans, mortgages and leases (1)(2) 34,301,452 350,358 4.05 % 30,419,546 299,974 3.91 % Residential mortgages and consumer loans 223,929 2,393 4.24 % 265,083 2,649 3.96 % Loans held for sale 320,712 2,442 3.02 % 153,042 911 2.36 % Total interest-earning assets 44,857,965 435,236 3.85 % 40,295,104 371,731 3.66 % Non-interest-earning assets 624,664 587,209 Total assets $ 45,482,629 40,882,313 INTEREST-BEARING LIABILITIES Interest-bearing deposits NOW and interest-bearing demand $ 3,654,079 14,122 1.53 % 3,919,003 8,627 0.87 % Money market 18,090,481 56,798 1.25 % 17,260,584 33,523 0.77 % Time deposits 1,765,996 8,280 1.86 % 1,516,042 4,509 1.18 % Non-interest-bearing demand deposits 12,213,759 - - 10,678,696 - - Total deposits 35,724,315 79,200 0.88 % 33,374,325 46,659 0.55 % Subordinated debt 257,843 3,645 5.65 % 257,050 3,645 5.67 % Other borrowings 4,850,924 26,587 2.17 % 3,085,542 11,547 1.48 % Total deposits and borrowings 40,833,082 109,432 1.06 % 36,716,917 61,851 0.67 %Other non-interest-bearing liabilities and shareholders' equity
4,649,547 4,165,396 Total liabilities and shareholders' equity $ 45,482,629 40,882,313 OTHER DATA Net interest income / interest rate spread (1) 325,804 2.79 % 309,880 2.99 % Tax-equivalent adjustment (1,008 ) (1,062 ) Net interest income, as reported 324,796 308,818 Net interest margin 2.87 % 3.04 % Tax-equivalent effect 0.01 % 0.01 % Net interest margin on a tax-equivalent basis (1)(2) 2.88 % 3.05 %Ratio of average interest-earning assets to average interest-bearing liabilities
109.86 % 109.75 %(1)
Presented on a tax-equivalent, non-GAAP basis for municipal leasing and financing transactions using the U.S. federal statutory tax rate of 21 percent for the period ended September 30, 2018 and 35 percent for the period ended September 30, 2017.
(2)
See "Non-GAAP Financial Measures" for related calculation.
SIGNATURE BANK NET INTEREST MARGIN ANALYSIS (unaudited) Nine months ended Nine months ended September 30, 2018 September 30, 2017 (dollars in thousands)AverageBalance
InterestIncome/Expense
AverageYield/Rate
AverageBalance
InterestIncome/Expense
AverageYield/Rate
INTEREST-EARNING ASSETS Short-term investments $ 465,298 6,209 1.78 % 471,151 3,598 1.02 % Investment securities 9,359,974 221,924 3.16 % 8,891,079 201,431 3.02 % Commercial loans, mortgages and leases (1)(2) 33,483,359 1,007,006 4.02 % 29,886,204 869,752 3.89 % Residential mortgages and consumer loans 234,007 7,255 4.15 % 271,273 7,850 3.87 % Loans held for sale 384,571 8,205 2.85 % 196,842 3,155 2.14 % Total interest-earning assets 43,927,209 1,250,599 3.81 % 39,716,549 1,085,786 3.66 % Non-interest-earning assets 593,551 565,087 Total assets $ 44,520,760 40,281,636 INTEREST-BEARING LIABILITIES Interest-bearing deposits NOW and interest-bearing demand $ 3,678,705 36,843 1.34 % 3,835,571 20,502 0.71 % Money market 17,676,403 143,082 1.08 % 17,003,578 89,427 0.70 % Time deposits 1,564,257 19,339 1.65 % 1,473,261 11,843 1.07 % Non-interest-bearing demand deposits 11,845,801 - - 10,555,056 - - Total deposits 34,765,166 199,264 0.77 % 32,867,466 121,772 0.50 % Subordinated debt 257,647 10,928 5.66 % 256,853 10,890 5.65 % Other borrowings 5,002,029 73,957 1.98 % 3,029,683 32,736 1.44 % Total deposits and borrowings 40,024,842 284,149 0.95 % 36,154,002 165,398 0.61 %Other non-interest-bearing liabilities and shareholders' equity
4,495,918 4,127,634 Total liabilities and shareholders' equity $ 44,520,760 40,281,636 OTHER DATA Net interest income / interest rate spread (1) 966,450 2.86 % 920,388 3.05 % Tax-equivalent adjustment (2,742 ) (2,574 ) Net interest income, as reported 963,708 917,814 Net interest margin 2.93 % 3.09 % Tax-equivalent effect 0.01 0.01 Net interest margin on a tax-equivalent basis (1)(2) 2.94 % 3.10 %Ratio of average interest-earning assets to average interest-bearing liabilities
109.75 % 109.85 % (1)Presented on a tax-equivalent, non-GAAP basis for municipal leasing and financing transactions using the U.S. federal statutory tax rate of 21 percent for the period ended September 30, 2018 and 35 percent for the period ended September 30, 2017.
(2) See "Non-GAAP Financial Measures" for related calculation.SIGNATURE BANKNON-GAAP FINANCIAL MEASURES(unaudited)
Management believes that the presentation of certain non-GAAP financial measures assist investors when comparing results period-to-period in a more consistent manner and provides a better measure of Signature Bank's results. These non-GAAP measures include the Bank's (i) tangible common equity ratio, (ii) efficiency ratio, (iii) yield on interest-earning assets, tax-equivalent basis, and (iv) core net interest margin, tax-equivalent basis excluding loan prepayment penalty income. These non-GAAP measures should not be considered a substitute for GAAP-basis measures and results. We strongly encourage investors to review our consolidated financial statements in their entirety and not to rely on any single financial measure. Because non-GAAP financial measures are not standardized, it may not be possible to compare these financial measures with other companies’ non-GAAP financial measures having the same or similar names.
The following table presents the tangible common equity ratio calculation: (dollars in thousands)September 30,2018
June 30,2018
December 31,2017
September 30,2017
Consolidated common shareholders' equity $ 4,237,997 4,147,623 4,031,691 3,931,953 Intangible assets 43,372 34,261 28,643 32,741 Consolidated tangible common shareholders' equity (TCE) $ 4,194,625 4,113,362 4,003,048 3,899,212 Consolidated total assets $ 45,870,710 45,215,484 43,117,720 41,326,924 Intangible assets 43,372 34,261 28,643 32,741 Consolidated tangible total assets (TTA) $ 45,827,338 45,181,223 43,089,077 41,294,183 Tangible common equity ratio (TCE/TTA) 9.15 % 9.10 % 9.29 % 9.44 % The following table presents the efficiency ratio calculation:Three months endedSeptember 30,
Nine months endedSeptember 30,
(dollars in thousands) 2018 2017 2018 2017 Non-interest expense (NIE) $ 117,208 105,628 367,135 325,099 Net interest income before provision for loan and lease losses 324,796 308,818 963,954 917,814 Other non-interest income 4,543 8,119 17,360 27,543 Total income (TI) $ 329,339 316,937 981,314 945,357 Efficiency ratio (NIE/TI) 35.59 % 33.33 % 37.41 % 34.39 % The following table reconciles yield on interest-earning assets to the yield on interest-earning assets on a tax-equivalent basis:Three months endedSeptember 30,
Nine months endedSeptember 30,
2018 2017 2018 2017 Interest income (as reported) $ 434,228 370,669 1,248,103 1,083,212 Tax-equivalent adjustment 1,008 1,062 2,742 2,574 Interest income, tax-equivalent basis $ 435,236 371,731 1,250,845 1,085,786 Interest-earnings assets $ 44,857,965 40,295,104 43,927,209 39,716,549 Yield on interest-earning assets 3.84 % 3.65 % 3.80 % 3.65 % Tax-equivalent effect 0.01 % 0.01 % 0.01 % 0.01 % Yield on interest-earning assets, tax-equivalent basis 3.85 % 3.66 % 3.81 % 3.66 % The following table reconciles net interest margin (as reported) to core net interest margin on a tax-equivalent basis excluding loan prepayment penalty income: Three months endedSeptember 30,
Nine months endedSeptember 30,
2018 2017 2018 2017 Net interest margin (as reported) 2.87 % 3.04 % 2.93 % 3.09 % Tax-equivalent adjustment 0.01 % 0.01 % 0.01 % 0.01 % Margin contribution from loan prepayment penalty income (0.03 )% (0.06 )% (0.05 )% (0.06 )% Core net interest margin, tax-equivalent basis excluding loan prepayment penalty income 2.85 % 2.99 % 2.89 % 3.04 %
View source version on businesswire.com: https://www.businesswire.com/news/home/20181018005193/en/
Signature BankInvestor Contact:Eric R. Howell, 646-822-1402Executive Vice President – Corporate & Business Developmentehowell@signatureny.comorMedia Contact:Susan J. Lewis, 646-822-1825slewis@signatureny.com
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