MOUNT LAUREL, N.J.,
July 26, 2017 /PRNewswire/ --
Second Quarter Highlights:
- On June 30, 2017, Sun Bancorp,
Inc. announced an agreement to be acquired by OceanFirst Financial
Corp. in a stock and cash merger with an aggregate value of
approximately $487 million at the
time of the announcement.
- Second quarter 2017 net income of $1.5
million, or $0.08 per diluted
share, compared to net income of $1.4
million, or $0.07 per diluted
share, in first quarter of 2017.
- The Company completed the previously announced redemptions of
$15 million and $25 million of trust preferred securities on
June 30, 2017 and July 23, 2017, respectively.
- Net interest margin increased by three basis points to 2.96% in
the second quarter of 2017 as compared to the first quarter of
2017; The acceleration of $415
thousand of deferred issuance costs for the early trust
preferred security redemptions reduced net interest margin by nine
basis points.
- Operating expense control continued with quarterly operating
expenses of $16.3 million in the
second quarter, which includes $400
thousand of merger-related costs as compared to $17.1 million in the prior-year quarter.
- Continuation of solid asset quality trends with non-performing
loans of $4.4 million at June 30, 2017, which is 0.28% of gross loans and
net recoveries of $59 thousand in the
second quarter; Recorded a negative provision for loan losses of
$831 thousand in the second
quarter.
- Board of Directors declared a dividend of $0.01 per share to holders of record of the
common stock of Sun Bancorp, Inc. as of August 22, 2017, payable on September 6, 2017.
Sun Bancorp, Inc. (NASDAQ: SNBC), (the "Company"), the holding
company for Sun National Bank (the
"Bank"), today reported net income of $1.5
million, or $0.08 per diluted
share, for the quarter ended June 30,
2017, compared to net income of $1.4
million, or $0.07 per diluted
share, for the quarter ended March 31,
2017, and net income of $3.0
million, or $0.16 per diluted
share, for the quarter ended June 30,
2016.
On June 30, 2017, the Company
entered into a definitive agreement with OceanFirst Financial Corp.
(NASDAQ: OCFC) ("OceanFirst"), pursuant to which the Company will
merge with and into OceanFirst with OceanFirst as the surviving
entity (the "Merger"). The Merger is expected to close in the
first quarter of 2018, subject to each company receiving the
required approval of its shareholders, receipt of all required
regulatory approvals and other customary closing conditions.
"This quarter was particularly noteworthy for our continued
success in managing non-interest expense and our cost of funds, as
well as realizing the predicted improvement in the net interest
margin," said Thomas M. O'Brien,
President & CEO. "This represents our tenth consecutive
profitable quarter, as well as our fifth consecutive quarterly
dividend declaration. This trend of consistently improving
our financial performance ultimately culminated with the
announcement of the merger agreement with OceanFirst at the end of
the quarter. This strategic partnership represents a
milestone for the Company, and recognizes the significant
achievements we have made in the last three years. OceanFirst
is an ideal partner whose focus on the community bank business
model, geographic markets and business strategies complement those
of the Company. We believe that combining our institutions
will create a premier New Jersey
community bank that will provide significant value for our
shareholders, while also benefiting our customers and the
communities that we serve."
Discussion of Results:
Balance Sheet
Total assets decreased to $2.22
billion at June 31, 2017, as
compared to $2.26 billion at both
March 31, 2017 and December 31, 2016. Cash and cash equivalents
totaled $127.8 million at
June 30, 2017, as compared to
$128.9 million at March 31, 2017 and $134.2
million at December 31,
2016. The decrease in cash and cash equivalents during the
first six months of 2017 was primarily due to a reduction in
brokered and subscription deposits and the redemption of
$15 million of trust preferred
securities, partially offset by decreases in net loans receivable
and investment securities.
Investment securities decreased by $15.6
million to $300.0 million at
June 30, 2017 from $315.6 million in the prior linked quarter
primarily due to pay downs of $28.9
million and the sale of the remaining collateralized lending
obligations portfolio of $13.5
million, partially offset by $26.2
million in purchases of primarily variable rate
mortgage-backed securities.
Net loans decreased by $20.2
million to $1.57 billion at
June 30, 2017 as compared to
$1.59 billion at each of March 31, 2017 and December 31, 2016, due primarily to the decrease
in loan origination and refinancing activity in the Commercial Real
Estate ("CRE") business during the second quarter of 2017. As
a result of the reduction in originations and refinancing activity,
non-owner occupied CRE loans fell by $18.3
million in the second quarter. Offsetting this
decrease, the Bank experienced continued momentum in its Commercial
and Industrial ("C&I") business segment. The C&I
segment, which includes owner-occupied CRE and C&I, grew by
$9.2 million in the second quarter
and has grown 15% annualized in the first half of 2017, due to an
increase of $21 million in C&I
loans, offset by a decrease of $11.8
million in owner-occupied CRE loans. Offsetting this
growth was continued reductions in residential and home equity
loans which fell by $12.0 million in
the second quarter as the Bank continued its strategy of not
originating new consumer loans.
"Our stated goal of strategically growing the C&I segment
continued in this quarter," stated O'Brien. "Our C&I
lending team continues to build momentum throughout the
region. On the CRE segment, we saw slower activity primarily
as a result of both higher interest rates as well as continued
uncertainty regarding tax reform."
Total deposits decreased to $1.71
billion at June 30, 2017, as
compared to $1.73 billion at
March 31, 2017 and $1.74 billion at December
31, 2016 due primarily to planned runoff in brokered
deposits and subscription deposits. The cost of deposits
increased by one basis point to 40 basis points compared to the
prior linked quarter and increased by six basis points as compared
to the six months ended June 30, 2016
due to the impact of the recent increase in market interest rates
and growth in retail certificates of deposit. Non-interest
deposits rose by $4.5 million to $409.7
million.
"Our ongoing strategy of growing relationship-based deposits
continued in the second quarter," stated O'Brien. "As we
reduced our wholesale brokered and other non-relationship deposit
accounts, we saw mild growth in our non-interest deposit
base. Despite increasing rates in the external environment,
our cost of deposits remains stable and attractive relative to our
peers. We have worked hard to stabilize and grow our deposit
portfolio and the related fee income appropriately derived from
it."
Net Interest Income and Margin
Net interest income was $14.9
million for the three months ended June 30, 2017, compared to $14.8 million for the three months ended
March 31, 2017, and $14.9 million for the three months ended
June 30, 2016. The Company's net
interest margin was 2.96% for the three months ended June 30, 2017 as compared to 2.93% for three
months ended March 31, 2017 and 2.98%
for the three months ended June 30,
2016. During the second quarter, the Bank accelerated
$415 thousand of deferred issuance
costs related to two tranches of trust preferred securities,
totaling $40 million, which were
fully redeemed during June and July of 2017. This
acceleration of costs reduced net interest margin by nine basis
points in the second quarter of 2017. Previous external
increases in short-term market interest rates provided a lift to
the net interest margin due to the asset-sensitive position in the
Company's balance sheet. The cost of deposits rose by one
basis point in the quarter to 0.40% while the loan yield rose by
eight basis points to 4.05%. The Company anticipates
$1.2 million of annualized savings
due to the trust preferred redemptions.
"In recent years, our elevated cash position has suppressed our
net interest margin," said O'Brien. "We believe that the
Company deployed excess liquidity prudently with shorter asset
durations and emphasized low cost relationship deposit strategies
when interest rates were low. These tactics are now providing
a benefit in the net interest margin after the three moves in
short-term interest rates since December of 2016. Once the
Company realizes the full benefit of the trust preferred
redemptions, the net interest margin will continue to move in a
favorable direction."
Non-Interest Income
Non-interest income was $3.0
million for the quarter ended June
30, 2017, as compared to $3.4
million and $3.8 million for
the quarters ended March 31, 2017 and
June 30, 2016, respectively.
The decrease in non-interest income from the quarter ended
March 31, 2017 is due primarily to
two loan related fees totaling $550
thousand that were recorded in the first quarter of 2017.
The decrease from the prior year quarter was due to
investment sale gains of $426
thousand in the quarter ended June
30, 2016 and higher deposit service charges and fees and
investment products income in the prior year quarter.
Non-Interest Expense
Non-interest expense for the second quarter of 2017 was
$16.3 million as compared to
$16.1 million for the three months
ended March 31, 2017 and $17.1 million for the three months ended
June 30, 2016. The increase in
non-interest expense from the prior linked quarter is due primarily
to an increase of $580 thousand in
professional fees, partially offset by a $300 thousand expense related to an outstanding
letter of credit on a previously-sold legacy loan recorded in the
first quarter of 2017. Professional fees in the second
quarter of 2017 include $400 thousand
of Merger related expenses. Non-interest expense for the
second quarter of 2017 declined by $777
thousand compared to the second quarter of 2016, primarily
due to a decrease of $148 thousand in
insurance expense as a result of reductions in FDIC assessment
rates, a decrease of $367 thousand in
salaries and employee benefit expense, a decrease of $117 thousand in problem loan expense, as well as
a decrease of $164 thousand in data
processing expense due to efficiency gains, partially offset by an
increase of $74 thousand related to
equipment expenses. The Bank recorded a vacation accrual in the
second quarter of 2017 of $461
thousand. This expense will be reversed in the second
half of the year.
"Our ability to manage expenses continues to be a strength at
the Company," said O'Brien. "While we experienced a one-time
Merger-related expense in the current quarter of $400 thousand and some other elevated expenses in
the second quarter due to a system conversion, we continue to see
favorable long-term trends in operating expenses and additional
opportunities to reduce operating expenses further in coming
quarters."
Asset Quality
Non-performing loans increased by $359
thousand to $4.4 million, or
0.28% of gross loans, at June 30,
2017 from $4.1 million, or
0.25% of gross loans, at March 31,
2017. This increase was primarily due to residential
mortgage loans entering non-accrual status during the three months
ended June 30, 2017.
Non-performing loans were $5.8
million, or 0.35% of gross loans, at June 30, 2016.
There was a negative provision for loan losses of $831 thousand during the quarter ended
June 30, 2017 compared to no
provision for loan losses during the quarter ended March 31, 2017 and a negative provision for loan
losses of $1.7 million recorded in
the second quarter of 2016. Continued credit strength,
limited charge-off activity, net recoveries of $59 thousand and loan pay downs resulted in a
reduced reserve need at June 30,
2017. In the first six months of 2017, the Bank recorded net
recoveries of $234 thousand as
compared to net charge-offs of $434
thousand in the first six months of 2016. The
allowance for loan losses was $14.9
million, or 0.94% of gross loans at June 30, 2017 as compared to $15.7 million, or 0.98% of gross loans at
March 31, 2017 and $16.0 million, or 1.02% of gross loans at
June 30, 2016. The allowance
for loan losses was 337% of non-performing loans at June 30, 2017 as compared to 385% of
non-performing loans at March 31,
2017 and 289% of non-performing loans at June 30, 2016.
Capital
The Company's capital ratios continue to remain very strong due
to positive earnings and a relatively flat balance sheet. The
redemption of trust preferred securities during the second quarter
reduced the Company's Tier 2 capital only, and thus only impacted
the Company's total risk-based capital ratio. All capital
ratios remain at robust levels and are sufficient to support the
Company's strategic plan. At June 30,
2017, the Bank had a Tier 1 common equity risk-based capital
ratio of 18.3%, total risk-based capital ratio of 19.3%, a Tier 1
risk-based capital ratio of 18.3% and a leverage capital ratio of
13.6%. At June 30, 2017, the
Company's Tier 1 common equity risk-based capital ratio, total
risk-based capital ratio, Tier 1 risk-based capital ratio and
leverage capital ratio were 16.2%, 21.4%, 19.7%, and 14.7%,
respectively. The Company's tangible equity to tangible
assets ratio was 13.2% at June 30,
2017, as compared to 12.8% at March
31, 2017 and 10.5% at June 30,
2016.
Dividend Declaration
On July 25, 2017, the Board of
Directors of the Company declared a dividend of $0.01 per share to holders of record of the
common stock of the Company as of August 22,
2017, payable on September 6,
2017.
"Our primary focus has continued to be delivering value to
shareholders," said O'Brien. "Our regular quarterly dividends
reflect our commitment to delivering value to stockholders and our
announced transaction with OceanFirst demonstrates our commitment
to creating long-term strategic value as well."
Conference Call
The Company will hold a conference call on Wednesday, July 26, 2017 at 11:00 a.m. (EDT) to discuss results and answer
questions from analysts and investors. Participants may listen to
or participate in the Company's earnings conference call via the
following:
- Participants Toll-Free Number: 888-466-4462
- Conference ID: 9943940
A transcript of the conference call will be available at the
Investor Relations section of www.sunnationalbank.com following the
call.
About Sun Bancorp, Inc.
Sun Bancorp, Inc. (NASDAQ: SNBC) is a $2.22 billion asset bank holding company
headquartered in Mount Laurel, New
Jersey. Its primary subsidiary is Sun National Bank, a community bank serving
customers throughout New Jersey,
and the metro New York region.
Sun National Bank is an Equal
Housing Lender and its deposits are insured up to the legal maximum
by the FDIC. For more information about Sun
National Bank and Sun Bancorp, Inc., visit
www.sunnationalbank.com.
Cautionary Note Regarding Forward-Looking
Statements
The foregoing material contains forward-looking
statements, as defined in the Private Securities
Litigation Reform Act of 1995, which may be identified by
the use of such words as "allow," "anticipate,"
"believe," "continues," "could," "estimate,"
"expect," "intend," "may," "opportunity," "outlook,"
"plan," "potential," "predict," "project,"
"reflects," "should," "typically," "usually,"
"view," "will," "would," and similar terms and
phrases, including references to assumptions. Examples
of forward-looking statements include, but are not limited to,
estimates with respect to the financial condition, results of
operations and business of the Company and the Bank, the banking
industry, the economy in general, expectations of the business
environment in which the Company operates,
projections of future performance and other statements contained
herein that are not historical facts. This press release may
also contain forward-looking statements about the benefits of the
Merger with OceanFirst, including future financial and operating
results of OceanFirst, the Company or the combined institution
following the Merger, the combined institution's plans, objectives,
expectations and intentions, the expected timing of the completion
of the Merger, the likelihood of success and other statements that
are not historical facts. These remarks are
based upon current management expectations, and may, therefore,
involve risks and uncertainties that cannot be
predicted or quantified and are beyond the Company's control and
are subject to a variety of uncertainties that could cause future
results to vary materially from the Company's historical
performance, or from current expectations.
Factors that could cause actual results to differ
from those expressed or implied by such forward-looking statements
include, but are not limited to: (i) delays in closing the
Merger and the ability of the Company or OceanFirst to obtain
regulatory approvals and meet other closing conditions to the
Merger, including receipt of approval from each company's
shareholders, (ii) the potential impact of announcement or
consummation of the Merger on relationships with third parties,
including customers, employees, and competitors, (iii) business
disruption following the Merger, (iv) difficulties and delays in
integrating the OceanFirst and Company businesses or fully
realizing cost savings and other benefits, (v) OceanFirst's
potential exposure to unknown or contingent liabilities of the
Company, (vi) the Company's ability to attract and retain key
management and staff; (vii) changes in business strategy or
an inability to successfully execute strategy due to the occurrence
of unanticipated events; (viii) the ability to
attract deposits and other sources of liquidity; (ix) changes in
the financial performance and/or condition of the Bank's
borrowers; (x) changes in consumer spending,
borrowing and saving habits; (xi) the ability to
increase market share and control expenses;
(xii) changes in estimates of future loan loss reserve
requirements based upon the periodic review thereof under relevant
regulatory and accounting requirements; (xiii) local,
regional and national economic conditions and events and the impact
they may have on the Company and its customers; (xiv)
volatility in the credit and equity markets and its effect on the
general economy; (xv) the credit risks of lending
activities, including changes in the level and trend of loan
delinquencies and write-offs; (xvi) the overall quality of the
composition of the Company's loan and securities portfolios; (xvii)
inflation, interest rate, securities market and monetary
fluctuations;(xviii) legislative and regulatory changes, including
the Dodd-Frank Wall Street Reform and Consumer Protection Act and
the implementing regulations, changes in banking, securities and
tax laws and regulations and their application by regulators and
changes in the scope and cost of the Federal Deposit Insurance
Corporation insurance and other coverages; (xix) the
effects of, and changes in, monetary
and fiscal policies and laws, including interest rate
policies of the Board of Governors of the Federal
Reserve System; (xx) competition among providers of
financial services; and (xxi) other economic, competitive,
governmental, regulatory and technological factors affecting our
operations, pricing, products and services and the other risks
detailed under the headings "Risk
Factors" and "Management's Discussion
and Analysis of Financial Condition and Results of
Operations" in the Company's Form 10-K
for the fiscal year ended December 31,
2016 and in other filings made pursuant to the Securities
Exchange Act of 1934, as amended. No undue
reliance should be placed on any forward-looking
statements. The Company does not undertake, and
specifically disclaims, any obligation to publicly release the
results of any revisions that may be made to any such
forward-looking statements to reflect the occurrence of
anticipated or unanticipated events or circumstances after the date
of such statements.
Additional Information about the Merger and Where to Find
it
In connection with the Merger, OceanFirst intends to file a
registration statement on Form S-4 with the Securities and Exchange
Commission ("SEC"), which includes a joint proxy statement of the
Company and OceanFirst and a prospectus of OceanFirst, and each
party has and will file other documents regarding the Merger with
the SEC. When available, copies of the definitive joint proxy
statement/prospectus will also be sent to Company stockholders
seeking any required stockholder approvals. Before making
any voting or investment decision, investors and security holders
of the Company are urged to carefully read the entire registration
statement and joint proxy statement/prospectus, when they become
available, as well as any amendments or supplements to these
documents, because they will contain important information about
the proposed transaction. The documents filed by OceanFirst and
the Company with the SEC may be obtained free of charge at the
SEC's website at www.sec.gov. In addition, the documents filed by
OceanFirst may be obtained free of charge at OceanFirst's website
at www.oceanfirstonline.com and the documents filed by the Company
may be obtained free of charge at the Company's website at
www.sunnationalbank.com. Alternatively, these documents, when
available, can be obtained free of charge from OceanFirst upon
written request to OceanFirst Financial Corp., Attn: Christopher D. Maher, 975 Hooper Avenue,
Toms River, New Jersey 08753, or
upon written request to Sun Bancorp, Inc., Attn: Janice M. Clark, Corporate Secretary, 350
Fellowship Road, Suite 101, Mount Laurel,
NJ 08054.
OceanFirst, the Company, their directors, executive officers
and certain other persons may be deemed to be participants in the
solicitation of proxies from OceanFirst's and the Company's
stockholders in favor of the approval of the Merger. Information
about the directors and executive officers of OceanFirst and their
ownership of OceanFirst common stock is set forth in the proxy
statement for OceanFirst's 2017 annual meeting of stockholders, as
previously filed with the SEC on April
26, 2017. Information about the directors and
executive officers of the Company and their ownership of Company
common stock is set forth in the Company's proxy statement for the
Company's 2017 annual meeting of stockholder as previously filed
with the SEC on March 30, 2017.
Stockholders may obtain additional information regarding the
interests of such participants in the Merger by reading the
registration statement and the proxy statement/prospectus when they
become available.
Non-GAAP Financial Measures (Unaudited)
This news release references tangible book value per common
share and return on average tangible equity, which are non-GAAP
financial measures. Management believes that tangible book value
per common share and return on average tangible equity are
meaningful financial measures because they are two of the measures
we use to assess capital adequacy.
Tangible book value per common share (dollars in
thousands)
The following reconciles shareholders' equity to tangible equity
by reducing shareholders' equity by the intangible asset balance at
June 30, 2017, March 31, 2017, December
31, 2016, September 30, 2016
and June 30, 2016.
|
|
June
30,
2017
|
|
|
March
31,
2017
|
|
|
December
31,
2016
|
|
|
September
30,
2016
|
|
|
June
30,
2016
|
|
Tangible book value
per common share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shareholders'
equity
|
|
$
|
325,060
|
|
|
$
|
322,816
|
|
|
$
|
319,709
|
|
|
$
|
265,878
|
|
|
$
|
264,172
|
|
Less: Intangible
assets
|
|
|
38,188
|
|
|
|
38,188
|
|
|
|
38,188
|
|
|
|
38,188
|
|
|
|
38,188
|
|
Tangible
equity
|
|
$
|
286,872
|
|
|
$
|
284,628
|
|
|
$
|
281,521
|
|
|
$
|
227,690
|
|
|
$
|
225,984
|
|
Common
stock
|
|
|
19,134
|
|
|
|
19,132
|
|
|
|
19,031
|
|
|
|
19,026
|
|
|
|
19,026
|
|
Less: Treasury
stock
|
|
|
73
|
|
|
|
75
|
|
|
|
108
|
|
|
|
138
|
|
|
|
172
|
|
Total outstanding
shares
|
|
|
19,061
|
|
|
|
19,057
|
|
|
|
18,923
|
|
|
|
18,888
|
|
|
|
18,854
|
|
Tangible book value
per common share:
|
|
$
|
15.05
|
|
|
$
|
14.94
|
|
|
$
|
14.88
|
|
|
$
|
12.05
|
|
|
$
|
11.99
|
|
Return on Average Tangible Equity (dollars in
thousands)
The following provides the calculation of return on tangible
equity for the three months ended June 30,
2017, March 31, 2017,
December 31, 2016, September 30, 2016 and June 30, 2016.
|
|
Three Months
Ended
|
|
|
|
June
30,
2017
|
|
|
March
31,
2017
|
|
|
December
31,
2016
|
|
|
September
30,
2016
|
|
|
June
30,
2016
|
|
Net income
|
|
$
|
1,455
|
|
|
$
|
1,430
|
|
|
$
|
56,000
|
|
|
$
|
1,630
|
|
|
$
|
2,963
|
|
Average tangible
equity:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average shareholders'
equity
|
|
$
|
325,919
|
|
|
$
|
323,258
|
|
|
$
|
267,542
|
|
|
$
|
266,931
|
|
|
$
|
262,517
|
|
Less: Average
intangible assets
|
|
|
38,188
|
|
|
|
38,188
|
|
|
|
38,188
|
|
|
|
38,188
|
|
|
|
38,188
|
|
Average tangible
equity
|
|
$
|
287,731
|
|
|
$
|
285,070
|
|
|
$
|
229,354
|
|
|
$
|
228,743
|
|
|
$
|
224,329
|
|
Return on average
tangible equity(1):
|
|
|
2.0
|
%
|
|
|
2.0
|
%
|
|
|
97.7
|
%
|
|
|
2.9
|
%
|
|
|
5.3
|
%
|
SUN BANCORP, INC AND
SUBSIDIARIES
FINANCIAL HIGHLIGHTS (Unaudited)
(Dollars in thousands, except share and per share
amounts)
|
|
|
|
For the Three
Months Ended
|
|
|
For the Six Months
Ended
|
|
|
|
June
30,
|
|
|
June
30,
|
|
|
|
2017
|
|
|
2016
|
|
|
2017
|
|
|
2016
|
|
Profitability for the
period:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest
income
|
|
$
|
14,863
|
|
|
$
|
14,872
|
|
|
$
|
29,635
|
|
|
$
|
29,358
|
|
(Recovery of)
provision for loan losses
|
|
|
(831)
|
|
|
|
(1,682)
|
|
|
|
(831)
|
|
|
|
(1,682)
|
|
Non-interest
income
|
|
|
3,000
|
|
|
|
3,774
|
|
|
|
6,431
|
|
|
|
6,936
|
|
Non-interest
expense
|
|
|
16,289
|
|
|
|
17,066
|
|
|
|
32,351
|
|
|
|
33,590
|
|
Income before income
taxes
|
|
|
2,405
|
|
|
|
3,262
|
|
|
|
4,546
|
|
|
|
4,386
|
|
Income tax expense
(benefit)
|
|
|
950
|
|
|
|
299
|
|
|
|
1,661
|
|
|
|
598
|
|
Net income available
to common shareholders
|
|
$
|
1,455
|
|
|
$
|
2,963
|
|
|
$
|
2,885
|
|
|
$
|
3,788
|
|
Financial
ratios:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Return on average
assets (1)
|
|
|
0.3
|
%
|
|
|
0.5
|
%
|
|
|
0.3
|
%
|
|
|
0.2
|
%
|
Return on average
equity (1)
|
|
|
1.8
|
%
|
|
|
4.5
|
%
|
|
|
1.8
|
%
|
|
|
5.8
|
%
|
Return on average
tangible equity (1), (2)
|
|
|
2.0
|
%
|
|
|
5.3
|
%
|
|
|
2.0
|
%
|
|
|
6.8
|
%
|
Net interest margin
(1)
|
|
|
2.96
|
%
|
|
|
2.98
|
%
|
|
|
2.94
|
%
|
|
|
2.94
|
%
|
Efficiency
ratio
|
|
|
91
|
%
|
|
|
92
|
%
|
|
|
90
|
%
|
|
|
93
|
%
|
Income per common
share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$
|
0.08
|
|
|
$
|
0.16
|
|
|
$
|
0.15
|
|
|
$
|
0.20
|
|
Diluted
|
|
$
|
0.08
|
|
|
$
|
0.16
|
|
|
$
|
0.15
|
|
|
$
|
0.20
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average equity to
average assets
|
|
|
14.6
|
%
|
|
|
12.0
|
%
|
|
|
14.5
|
%
|
|
|
12.0
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June
30,
|
|
|
December
31,
|
|
|
|
|
|
|
|
2017
|
|
|
2016
|
|
|
|
2016
|
|
|
|
|
|
At
period-end:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
assets
|
|
$
|
2,216,802
|
|
|
$
|
2,186,982
|
|
|
$
|
2,262,262
|
|
|
|
|
|
Total
deposits
|
|
|
1,708,253
|
|
|
|
1,713,665
|
|
|
|
1,741,363
|
|
|
|
|
|
Loans receivable, net
of allowance for loan losses
|
|
|
1,574,167
|
|
|
|
1,548,593
|
|
|
|
1,594,377
|
|
|
|
|
|
Loans
held-for-sale
|
|
|
—
|
|
|
|
540
|
|
|
|
—
|
|
|
|
|
|
Investments
|
|
|
299,987
|
|
|
|
296,714
|
|
|
|
311,727
|
|
|
|
|
|
Borrowings
|
|
|
91,396
|
|
|
|
92,011
|
|
|
|
91,708
|
|
|
|
|
|
Junior subordinated
debentures
|
|
|
77,322
|
|
|
|
92,786
|
|
|
|
92,786
|
|
|
|
|
|
Shareholders'
equity
|
|
|
325,060
|
|
|
|
264,172
|
|
|
|
319,709
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Credit quality and
capital ratios:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Allowance for loan
losses to gross loans held-for-investment
|
|
|
0.94
|
%
|
|
|
1.02
|
%
|
|
|
0.97
|
%
|
|
|
|
|
Non-performing loans
held-for-investment to gross loans held-for-investment
|
|
|
0.28
|
%
|
|
|
0.35
|
%
|
|
|
0.19
|
%
|
|
|
|
|
Non-performing assets
to total assets
|
|
|
0.20
|
%
|
|
|
0.27
|
%
|
|
|
0.14
|
%
|
|
|
|
|
Allowance for loan
losses to non-performing loans held-for-investment
|
|
|
337
|
%
|
|
|
289
|
%
|
|
|
501
|
%
|
|
|
|
|
Tier 1 common equity
risk-based capital:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sun Bancorp,
Inc.
|
|
|
16.2
|
%
|
|
|
14.3
|
%
|
|
|
16.0
|
%
|
|
|
|
|
Sun National
Bank
|
|
|
18.3
|
%
|
|
|
18.1
|
%
|
|
|
18.9
|
%
|
|
|
|
|
Total risk-based
capital:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sun Bancorp,
Inc.
|
|
|
21.4
|
%
|
|
|
21.0
|
%
|
|
|
21.6
|
%
|
|
|
|
|
Sun National
Bank
|
|
|
19.3
|
%
|
|
|
19.1
|
%
|
|
|
19.8
|
%
|
|
|
|
|
Tier 1 risk-based
capital:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sun Bancorp,
Inc.
|
|
|
19.7
|
%
|
|
|
17.9
|
%
|
|
|
18.9
|
%
|
|
|
|
|
Sun National
Bank
|
|
|
18.3
|
%
|
|
|
18.1
|
%
|
|
|
18.9
|
%
|
|
|
|
|
Leverage
capital:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sun Bancorp,
Inc.
|
|
|
14.7
|
%
|
|
|
13.2
|
%
|
|
|
14.6
|
%
|
|
|
|
|
Sun National
Bank
|
|
|
13.6
|
%
|
|
|
13.3
|
%
|
|
|
14.5
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Book value per common
share
|
|
$
|
17.05
|
|
|
$
|
14.01
|
|
|
$
|
16.90
|
|
|
|
|
|
Tangible book value
per common share
|
|
$
|
15.05
|
|
|
$
|
11.99
|
|
|
$
|
14.88
|
|
|
|
|
|
|
|
(1)
|
Annualized.
|
(2)
|
Return on average
tangible equity, a non-GAAP measure, is computed by dividing
annualized net income for the period by average tangible equity.
Average tangible equity equals average equity less average
identifiable intangible assets and goodwill.
|
(3)
|
June 30, 2017 capital
ratios are estimated, subject to regulatory filings.
|
SUN BANCORP, INC. AND
SUBSIDIARIES
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(Unaudited)
(Dollars in thousands, except share and per share
amounts)
|
|
|
|
June
30,
|
|
|
December
31,
|
|
|
|
2017
|
|
|
2016
|
|
ASSETS
|
|
|
|
|
|
|
|
|
Cash and due from
banks
|
|
$
|
22,086
|
|
|
$
|
19,645
|
|
Interest earning bank
balances
|
|
|
105,745
|
|
|
|
114,563
|
|
Cash and cash
equivalents
|
|
|
127,831
|
|
|
|
134,208
|
|
Restricted
cash
|
|
|
1,000
|
|
|
|
5,000
|
|
Investment securities
available for sale (amortized cost of $285,854 and $300,028 at
June 30, 2017
and December 31, 2016, respectively)
|
|
|
282,598
|
|
|
|
295,686
|
|
Investment securities
held to maturity (estimated fair value of $250 at
June 30, 2017
and December 31, 2016)
|
|
|
250
|
|
|
|
250
|
|
Loans receivable (net
of allowance for loan losses of $14,945 and $15,541
at June 30,
2017 and December 31, 2016, respectively)
|
|
|
1,574,167
|
|
|
|
1,594,377
|
|
Restricted equity
investments, at cost
|
|
|
17,139
|
|
|
|
15,791
|
|
Bank properties and
equipment, net
|
|
|
28,962
|
|
|
|
30,148
|
|
Accrued interest
receivable
|
|
|
4,944
|
|
|
|
5,122
|
|
Goodwill
|
|
|
38,188
|
|
|
|
38,188
|
|
Bank owned life
insurance (BOLI)
|
|
|
84,081
|
|
|
|
83,109
|
|
Deferred taxes,
net
|
|
|
49,442
|
|
|
|
51,573
|
|
Other
assets
|
|
|
8,200
|
|
|
|
8,810
|
|
Total
assets
|
|
$
|
2,216,802
|
|
|
$
|
2,262,262
|
|
LIABILITIES AND
SHAREHOLDERS' EQUITY
|
|
|
|
|
|
|
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
Deposits
|
|
$
|
1,708,253
|
|
|
$
|
1,741,363
|
|
Advances from the
Federal Home Loan Bank of New York (FHLBNY)
|
|
|
85,317
|
|
|
|
85,416
|
|
Obligations under
capital lease
|
|
|
6,079
|
|
|
|
6,292
|
|
Junior subordinated
debentures
|
|
|
77,322
|
|
|
|
92,786
|
|
Other
liabilities
|
|
|
14,771
|
|
|
|
16,696
|
|
Total
liabilities
|
|
|
1,891,742
|
|
|
|
1,942,553
|
|
|
|
|
|
|
|
|
|
|
Commitments and
contingencies
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shareholders'
equity:
|
|
|
|
|
|
|
|
|
Preferred stock, $1
par value, 1,000,000 shares authorized; none issued
|
|
|
—
|
|
|
|
—
|
|
Common stock, $5 par
value, 40,000,000 shares authorized; 19,133,815 shares issued
and 19,060,593 shares
outstanding at June 30, 2017; 19,030,704 shares issued and
18,922,726
shares outstanding at December 31, 2016.
|
|
|
95,669
|
|
|
|
95,154
|
|
Additional paid-in
capital
|
|
|
509,124
|
|
|
|
508,593
|
|
Retained
deficit
|
|
|
(273,997)
|
|
|
|
(276,501)
|
|
Accumulated other
comprehensive loss
|
|
|
(1,926)
|
|
|
|
(2,568)
|
|
Deferred compensation
plan trust
|
|
|
(1,258)
|
|
|
|
(1,160)
|
|
Treasury stock at
cost, 73,222 shares at June 30, 2017 and 107,978 shares
at December 31,
2016.
|
|
|
(2,552)
|
|
|
|
(3,809)
|
|
Total shareholders'
equity
|
|
|
325,060
|
|
|
|
319,709
|
|
Total liabilities and
shareholders' equity
|
|
$
|
2,216,802
|
|
|
$
|
2,262,262
|
|
SUN BANCORP, INC. AND
SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
(Dollars in thousands, except share and per share
amounts)
|
|
|
|
For the Three
Months Ended
|
|
|
For the Six Months
Ended
|
|
|
|
June
30,
|
|
|
June
30,
|
|
|
|
2017
|
|
|
2016
|
|
|
2017
|
|
|
2016
|
|
INTEREST
INCOME:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest and fees on
loans
|
|
$
|
16,224
|
|
|
$
|
15,666
|
|
|
$
|
31,897
|
|
|
$
|
30,697
|
|
Interest on taxable
investment securities
|
|
|
1,797
|
|
|
|
1,618
|
|
|
|
3,582
|
|
|
|
3,298
|
|
Dividends on
restricted equity investments
|
|
|
230
|
|
|
|
214
|
|
|
|
468
|
|
|
|
437
|
|
Total interest
income
|
|
|
18,251
|
|
|
|
17,498
|
|
|
|
35,947
|
|
|
|
34,432
|
|
INTEREST
EXPENSE:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest on
deposits
|
|
|
1,693
|
|
|
|
1,456
|
|
|
|
3,379
|
|
|
|
2,748
|
|
Interest on funds
borrowed
|
|
|
534
|
|
|
|
542
|
|
|
|
1,065
|
|
|
|
1,086
|
|
Interest on junior
subordinated debentures
|
|
|
1,161
|
|
|
|
628
|
|
|
|
1,868
|
|
|
|
1,240
|
|
Total interest
expense
|
|
|
3,388
|
|
|
|
2,626
|
|
|
|
6,312
|
|
|
|
5,074
|
|
Net interest
income
|
|
|
14,863
|
|
|
|
14,872
|
|
|
|
29,635
|
|
|
|
29,358
|
|
(RECOVERY OF)
PROVISION FOR LOAN LOSSES
|
|
|
(831)
|
|
|
|
(1,682)
|
|
|
|
(831)
|
|
|
|
(1,682)
|
|
Net interest income
after provision for loan losses
|
|
|
15,694
|
|
|
|
16,554
|
|
|
|
30,466
|
|
|
|
31,040
|
|
NON-INTEREST
INCOME:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Deposit service
charges and fees
|
|
|
1,367
|
|
|
|
1,618
|
|
|
|
2,769
|
|
|
|
3,198
|
|
Interchange
fees
|
|
|
510
|
|
|
|
486
|
|
|
|
977
|
|
|
|
970
|
|
Investment products
income
|
|
|
327
|
|
|
|
538
|
|
|
|
611
|
|
|
|
914
|
|
BOLI income
|
|
|
488
|
|
|
|
489
|
|
|
|
972
|
|
|
|
997
|
|
Other
income
|
|
|
308
|
|
|
|
643
|
|
|
|
1,102
|
|
|
|
857
|
|
Total non-interest
income
|
|
|
3,000
|
|
|
|
3,774
|
|
|
|
6,431
|
|
|
|
6,936
|
|
NON-INTEREST
EXPENSE:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Salaries and employee
benefits
|
|
|
8,966
|
|
|
|
9,333
|
|
|
|
17,848
|
|
|
|
18,396
|
|
Occupancy
expense
|
|
|
2,252
|
|
|
|
2,144
|
|
|
|
4,602
|
|
|
|
4,482
|
|
Equipment
expense
|
|
|
1,142
|
|
|
|
1,068
|
|
|
|
2,299
|
|
|
|
2,159
|
|
Data processing
expense
|
|
|
911
|
|
|
|
1,075
|
|
|
|
1,930
|
|
|
|
2,263
|
|
Professional
fees
|
|
|
1,116
|
|
|
|
537
|
|
|
|
1,652
|
|
|
|
1,008
|
|
Insurance
expense
|
|
|
408
|
|
|
|
556
|
|
|
|
803
|
|
|
|
1,344
|
|
Advertising
expense
|
|
|
346
|
|
|
|
393
|
|
|
|
659
|
|
|
|
775
|
|
Problem loan
expense
|
|
|
70
|
|
|
|
187
|
|
|
|
204
|
|
|
|
220
|
|
Other
expense
|
|
|
1,078
|
|
|
|
1,773
|
|
|
|
2,354
|
|
|
|
2,943
|
|
Total non-interest
expense
|
|
|
16,289
|
|
|
|
17,066
|
|
|
|
32,351
|
|
|
|
33,590
|
|
INCOME BEFORE
INCOME TAXES
|
|
|
2,405
|
|
|
|
3,262
|
|
|
|
4,546
|
|
|
|
4,386
|
|
INCOME TAX
EXPENSE
|
|
|
950
|
|
|
|
299
|
|
|
|
1,661
|
|
|
|
598
|
|
NET INCOME
AVAILABLE TO COMMON
SHAREHOLDERS
|
|
$
|
1,455
|
|
|
$
|
2,963
|
|
|
$
|
2,885
|
|
|
$
|
3,788
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings per
share
|
|
$
|
0.08
|
|
|
$
|
0.16
|
|
|
$
|
0.15
|
|
|
$
|
0.20
|
|
Diluted earnings per
share
|
|
$
|
0.08
|
|
|
$
|
0.16
|
|
|
$
|
0.15
|
|
|
$
|
0.20
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
shares - basic
|
|
|
19,059,626
|
|
|
|
18,848,236
|
|
|
|
19,023,024
|
|
|
|
18,793,987
|
|
Weighted average
shares - diluted
|
|
|
19,191,294
|
|
|
|
18,957,201
|
|
|
|
19,149,326
|
|
|
|
18,889,561
|
|
SUN BANCORP, INC. AND
SUBSIDIARIES
HISTORICAL TRENDS IN QUARTERLY FINANCIAL DATA (Unaudited)
(dollars in thousands)
|
|
|
|
|
2017
|
|
|
2017
|
|
|
2016
|
|
|
2016
|
|
|
2016
|
|
|
|
|
|
Q2
|
|
|
Q1
|
|
|
Q4
|
|
|
Q3
|
|
|
Q2
|
|
|
Profitability for the
quarter:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest
income
|
|
|
$
|
14,863
|
|
|
$
|
14,772
|
|
|
$
|
14,834
|
|
|
$
|
14,712
|
|
|
$
|
14,872
|
|
|
(Recovery of)
provision for loan losses
|
|
|
|
(831)
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(1,682)
|
|
|
Non-interest
income
|
|
|
|
3,000
|
|
|
|
3,431
|
|
|
|
3,311
|
|
|
|
3,142
|
|
|
|
3,774
|
|
|
Non-interest
expense
|
|
|
|
16,289
|
|
|
|
16,062
|
|
|
|
15,425
|
|
|
|
15,937
|
|
|
|
17,066
|
|
|
Income before income
taxes
|
|
|
|
2,405
|
|
|
|
2,141
|
|
|
|
2,720
|
|
|
|
1,917
|
|
|
|
3,262
|
|
|
Income tax expense
(benefit)
|
|
|
|
950
|
|
|
|
711
|
|
|
|
(53,280)
|
|
|
|
287
|
|
|
|
299
|
|
|
Net income available
to common shareholders
|
|
|
$
|
1,455
|
|
|
$
|
1,430
|
|
|
$
|
56,000
|
|
|
$
|
1,630
|
|
|
$
|
2,963
|
|
|
Financial
ratios:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Return on average
assets (1)
|
|
|
|
0.3
|
%
|
|
|
0.3
|
%
|
|
|
10.2
|
%
|
|
|
0.3
|
%
|
|
|
0.5
|
%
|
|
Return on average
equity (1)
|
|
|
|
1.8
|
%
|
|
|
1.8
|
%
|
|
|
83.7
|
%
|
|
|
2.4
|
%
|
|
|
4.5
|
%
|
|
Return on average
tangible equity (1), (2)
|
|
|
|
2.0
|
%
|
|
|
2.0
|
%
|
|
|
97.7
|
%
|
|
|
2.9
|
%
|
|
|
5.3
|
%
|
|
Net interest margin
(1)
|
|
|
|
2.96
|
%
|
|
|
2.93
|
%
|
|
|
2.93
|
%
|
|
|
2.94
|
%
|
|
|
2.98
|
%
|
|
Efficiency
ratio
|
|
|
|
91
|
%
|
|
|
88
|
%
|
|
|
85
|
%
|
|
|
89
|
%
|
|
|
93
|
%
|
|
Per share
data :
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income per common
share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
$
|
0.08
|
|
|
$
|
0.08
|
|
|
$
|
2.96
|
|
|
$
|
0.09
|
|
|
$
|
0.16
|
|
|
Diluted
|
|
|
$
|
0.08
|
|
|
$
|
0.07
|
|
|
$
|
2.94
|
|
|
$
|
0.09
|
|
|
$
|
0.16
|
|
|
Book value
|
|
|
$
|
17.05
|
|
|
$
|
16.94
|
|
|
$
|
16.90
|
|
|
$
|
14.08
|
|
|
$
|
14.01
|
|
|
Tangible book
value
|
|
|
$
|
15.05
|
|
|
$
|
14.94
|
|
|
$
|
14.88
|
|
|
$
|
12.05
|
|
|
$
|
11.99
|
|
|
Cash dividends
paid
|
|
|
$
|
0.01
|
|
|
$
|
0.01
|
|
|
$
|
0.01
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
Average basic
shares
|
|
|
|
19,059,626
|
|
|
|
18,986,015
|
|
|
|
18,908,688
|
|
|
|
18,874,577
|
|
|
|
18,848,236
|
|
|
Average diluted
shares
|
|
|
|
19,191,294
|
|
|
|
19,107,226
|
|
|
|
19,016,188
|
|
|
|
18,962,740
|
|
|
|
18,957,201
|
|
|
Non-interest
income:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Deposit service
charges and fees
|
|
|
$
|
1,367
|
|
|
$
|
1,402
|
|
|
$
|
1,484
|
|
|
$
|
1,540
|
|
|
$
|
1,618
|
|
|
Interchange
fees
|
|
|
|
510
|
|
|
|
467
|
|
|
|
483
|
|
|
|
451
|
|
|
|
486
|
|
|
Gain on sale of
investment securities
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
426
|
|
|
Gain on sale of
loans
|
|
|
|
—
|
|
|
|
—
|
|
|
|
60
|
|
|
|
41
|
|
|
|
—
|
|
|
Investment products
income
|
|
|
|
327
|
|
|
|
284
|
|
|
|
288
|
|
|
|
505
|
|
|
|
538
|
|
|
BOLI income
|
|
|
|
488
|
|
|
|
484
|
|
|
|
452
|
|
|
|
485
|
|
|
|
489
|
|
|
Other
income
|
|
|
|
308
|
|
|
|
794
|
|
|
|
544
|
|
|
|
120
|
|
|
|
217
|
|
|
Total non-interest
income
|
|
|
$
|
3,000
|
|
|
$
|
3,431
|
|
|
$
|
3,311
|
|
|
$
|
3,142
|
|
|
$
|
3,774
|
|
|
Non-interest
expense:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Salaries and employee
benefits
|
|
|
$
|
8,966
|
|
|
$
|
8,882
|
|
|
$
|
7,926
|
|
|
$
|
8,649
|
|
|
$
|
9,333
|
|
|
Occupancy
expense
|
|
|
|
2,252
|
|
|
|
2,350
|
|
|
|
2,232
|
|
|
|
2,273
|
|
|
|
2,144
|
|
|
Equipment
expense
|
|
|
|
1,142
|
|
|
|
1,157
|
|
|
|
1,324
|
|
|
|
1,303
|
|
|
|
1,068
|
|
|
Data processing
expense
|
|
|
|
911
|
|
|
|
1,019
|
|
|
|
1,124
|
|
|
|
1,116
|
|
|
|
1,075
|
|
|
Professional
fees
|
|
|
|
1,116
|
|
|
|
536
|
|
|
|
508
|
|
|
|
730
|
|
|
|
537
|
|
|
Insurance
expense
|
|
|
|
408
|
|
|
|
395
|
|
|
|
368
|
|
|
|
452
|
|
|
|
556
|
|
|
Advertising
expense
|
|
|
|
346
|
|
|
|
313
|
|
|
|
473
|
|
|
|
412
|
|
|
|
393
|
|
|
Problem loan
expenses
|
|
|
|
70
|
|
|
|
134
|
|
|
|
61
|
|
|
|
131
|
|
|
|
187
|
|
|
Other
expenses
|
|
|
|
1,078
|
|
|
|
1,276
|
|
|
|
1,409
|
|
|
|
871
|
|
|
|
1,773
|
|
|
Total non-interest
expense
|
|
|
$
|
16,289
|
|
|
$
|
16,062
|
|
|
$
|
15,425
|
|
|
$
|
15,937
|
|
|
$
|
17,066
|
|
|
|
|
(1)
|
Annualized.
|
(2)
|
Return on average
tangible equity, a non-GAAP measure, is computed by dividing
annualized net income for the period by average tangible equity.
Average tangible equity equals average equity less average
identifiable intangible assets and goodwill.
|
SUN BANCORP, INC. AND
SUBSIDIARIES
HISTORICAL TRENDS IN QUARTERLY FINANCIAL DATA
(Unaudited)
(dollars in thousands)
|
|
|
|
2017
|
|
|
2017
|
|
|
2016
|
|
|
2016
|
|
|
2016
|
|
|
|
Q2
|
|
|
Q1
|
|
|
Q4
|
|
|
Q3
|
|
|
Q2
|
|
Balance Sheet at
quarter end:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
127,831
|
|
|
$
|
128,892
|
|
|
$
|
134,208
|
|
|
$
|
156,292
|
|
|
$
|
168,799
|
|
Restricted
cash
|
|
|
1,000
|
|
|
|
1,000
|
|
|
|
5,000
|
|
|
|
5,000
|
|
|
|
5,000
|
|
Investment
securities
|
|
|
299,987
|
|
|
|
315,558
|
|
|
|
311,727
|
|
|
|
308,031
|
|
|
|
296,714
|
|
Loans
held-for-investment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Commercial and
industrial
|
|
|
251,346
|
|
|
|
230,306
|
|
|
|
235,946
|
|
|
|
226,493
|
|
|
|
220,609
|
|
Commercial real estate
- owner occupied
|
|
|
250,164
|
|
|
|
261,971
|
|
|
|
231,348
|
|
|
|
226,165
|
|
|
|
225,520
|
|
Commercial real estate
- non-owner occupied
|
|
|
710,831
|
|
|
|
729,102
|
|
|
|
742,662
|
|
|
|
676,323
|
|
|
|
666,345
|
|
Land and
development
|
|
|
67,042
|
|
|
|
67,336
|
|
|
|
67,165
|
|
|
|
84,692
|
|
|
|
82,018
|
|
Residential real
estate
|
|
|
196,157
|
|
|
|
205,573
|
|
|
|
210,874
|
|
|
|
226,691
|
|
|
|
237,080
|
|
Home equity and
other
|
|
|
113,572
|
|
|
|
116,187
|
|
|
|
121,923
|
|
|
|
126,302
|
|
|
|
132,912
|
|
Total loans
|
|
|
1,589,112
|
|
|
|
1,610,475
|
|
|
|
1,609,918
|
|
|
|
1,566,666
|
|
|
|
1,564,484
|
|
Allowance for loan
losses
|
|
|
(14,945)
|
|
|
|
(15,716)
|
|
|
|
(15,541)
|
|
|
|
(15,827)
|
|
|
|
(15,891)
|
|
Net loans
held-for-investment
|
|
|
1,574,167
|
|
|
|
1,594,759
|
|
|
|
1,594,377
|
|
|
|
1,550,839
|
|
|
|
1,548,593
|
|
Loans
held-for-sale
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
1,450
|
|
|
|
540
|
|
Goodwill
|
|
|
38,188
|
|
|
|
38,188
|
|
|
|
38,188
|
|
|
|
38,188
|
|
|
|
38,188
|
|
Total
assets
|
|
|
2,216,802
|
|
|
|
2,255,773
|
|
|
|
2,262,262
|
|
|
|
2,189,346
|
|
|
|
2,186,982
|
|
Net deferred tax
asset, before valuation allowance
|
|
|
123,107
|
|
|
|
125,238
|
|
|
|
124,574
|
|
|
|
125,051
|
|
|
|
126,744
|
|
Deferred tax valuation
allowance
|
|
|
(73,665)
|
|
|
|
(73,665)
|
|
|
|
(127,973)
|
|
|
|
(128,362)
|
|
|
|
(129,248)
|
|
Total
deposits
|
|
|
1,708,253
|
|
|
|
1,733,989
|
|
|
|
1,741,363
|
|
|
|
1,717,634
|
|
|
|
1,713,665
|
|
Advances from the
FHLBNY
|
|
|
85,317
|
|
|
|
85,367
|
|
|
|
85,416
|
|
|
|
85,465
|
|
|
|
85,513
|
|
Obligations under
capital leases
|
|
|
6,079
|
|
|
|
6,187
|
|
|
|
6,292
|
|
|
|
6,396
|
|
|
|
6,498
|
|
Junior subordinated
debentures
|
|
|
77,322
|
|
|
|
92,786
|
|
|
|
92,786
|
|
|
|
92,786
|
|
|
|
92,786
|
|
Total shareholders'
equity
|
|
|
325,060
|
|
|
|
322,816
|
|
|
|
319,709
|
|
|
|
265,878
|
|
|
|
264,172
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarterly average
balance sheet:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans
held-for-investment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Commercial
|
|
$
|
1,288,517
|
|
|
$
|
1,270,543
|
|
|
$
|
1,238,749
|
|
|
$
|
1,215,135
|
|
|
$
|
1,197,368
|
|
Residential real
estate
|
|
|
202,659
|
|
|
|
209,500
|
|
|
|
220,502
|
|
|
|
233,277
|
|
|
|
240,884
|
|
Home equity and
other
|
|
|
114,330
|
|
|
|
117,963
|
|
|
|
122,290
|
|
|
|
128,078
|
|
|
|
136,330
|
|
Total loans
|
|
|
1,605,506
|
|
|
|
1,598,006
|
|
|
|
1,581,541
|
|
|
|
1,576,490
|
|
|
|
1,574,582
|
|
Securities and other
interest-earning assets
|
|
|
405,240
|
|
|
|
417,171
|
|
|
|
442,409
|
|
|
|
425,042
|
|
|
|
422,667
|
|
Total interest-earning
assets
|
|
|
2,010,746
|
|
|
|
2,015,177
|
|
|
|
2,023,950
|
|
|
|
2,001,532
|
|
|
|
1,997,249
|
|
Total
assets
|
|
|
2,231,978
|
|
|
|
2,240,787
|
|
|
|
2,201,886
|
|
|
|
2,187,482
|
|
|
|
2,179,400
|
|
Non-interest-bearing
demand deposits
|
|
|
409,694
|
|
|
|
402,949
|
|
|
|
411,728
|
|
|
|
402,465
|
|
|
|
393,922
|
|
Total
deposits
|
|
|
1,707,873
|
|
|
|
1,717,848
|
|
|
|
1,731,312
|
|
|
|
1,709,863
|
|
|
|
1,707,574
|
|
Total interest-bearing
liabilities
|
|
|
1,482,256
|
|
|
|
1,499,303
|
|
|
|
1,504,138
|
|
|
|
1,492,139
|
|
|
|
1,498,510
|
|
Total shareholders'
equity
|
|
|
325,919
|
|
|
|
323,258
|
|
|
|
267,542
|
|
|
|
266,931
|
|
|
|
262,517
|
|
SUN BANCORP, INC. AND
SUBSIDIARIES
HISTORICAL TRENDS IN QUARTERLY FINANCIAL DATA
(Unaudited)
(dollars in thousands)
|
|
|
|
2017
|
|
|
2017
|
|
|
2016
|
|
|
2016
|
|
|
2016
|
|
|
|
Q2
|
|
|
Q1
|
|
|
Q4
|
|
|
Q3
|
|
|
Q2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Capital and credit
quality measures:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tier 1 common equity
risk-based capital:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sun Bancorp,
Inc.
|
|
|
16.2
|
%
|
|
|
15.8
|
%
|
|
|
16.0
|
%
|
|
|
14.5
|
%
|
|
|
14.3
|
%
|
Sun National
Bank
|
|
|
18.3
|
%
|
|
|
17.8
|
%
|
|
|
18.9
|
%
|
|
|
18.3
|
%
|
|
|
18.1
|
%
|
Total risk-based
capital:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sun Bancorp,
Inc.
|
|
|
21.4
|
%
|
|
|
21.9
|
%
|
|
|
21.6
|
%
|
|
|
21.2
|
%
|
|
|
21.0
|
%
|
Sun National
Bank
|
|
|
19.3
|
%
|
|
|
18.8
|
%
|
|
|
19.8
|
%
|
|
|
19.3
|
%
|
|
|
19.1
|
%
|
Tier 1 risk-based
capital:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sun Bancorp,
Inc.
|
|
|
19.7
|
%
|
|
|
19.2
|
%
|
|
|
18.9
|
%
|
|
|
18.1
|
%
|
|
|
17.9
|
%
|
Sun National
Bank
|
|
|
18.3
|
%
|
|
|
17.8
|
%
|
|
|
18.9
|
%
|
|
|
18.3
|
%
|
|
|
18.1
|
%
|
Leverage
capital:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sun Bancorp,
Inc.
|
|
|
14.7
|
%
|
|
|
14.5
|
%
|
|
|
14.6
|
%
|
|
|
13.3
|
%
|
|
|
13.2
|
%
|
Sun National
Bank
|
|
|
13.6
|
%
|
|
|
13.4
|
%
|
|
|
14.5
|
%
|
|
|
13.4
|
%
|
|
|
13.3
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average equity to
average assets
|
|
|
14.6
|
%
|
|
|
14.4
|
%
|
|
|
12.2
|
%
|
|
|
12.2
|
%
|
|
|
12.0
|
%
|
Allowance for loan
losses to gross loans held-for-
investment
|
|
|
0.94
|
%
|
|
|
0.98
|
%
|
|
|
0.97
|
%
|
|
|
1.01
|
%
|
|
|
1.02
|
%
|
Non-performing loans
held-for-investment to
gross loans held-for-investment
|
|
|
0.28
|
%
|
|
|
0.25
|
%
|
|
|
0.19
|
%
|
|
|
0.42
|
%
|
|
|
0.35
|
%
|
Non-performing assets
to total assets
|
|
|
0.20
|
%
|
|
|
0.18
|
%
|
|
|
0.14
|
%
|
|
|
0.31
|
%
|
|
|
0.27
|
%
|
Allowance for loan
losses to non-performing
loans held-for-investment
|
|
|
337
|
%
|
|
|
385
|
%
|
|
|
501
|
%
|
|
|
238
|
%
|
|
|
289
|
%
|
Other
data:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net recoveries
(charge-offs)
|
|
|
59
|
|
|
|
175
|
|
|
|
(285)
|
|
|
|
(65)
|
|
|
|
(378)
|
|
Classified
loans
|
|
|
7,979
|
|
|
|
7,752
|
|
|
|
6,887
|
|
|
|
8,593
|
|
|
|
9,310
|
|
Classified
assets
|
|
|
11,185
|
|
|
|
10,958
|
|
|
|
10,094
|
|
|
|
11,799
|
|
|
|
12,516
|
|
Non-performing
assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-accrual
loans
|
|
|
2,934
|
|
|
|
2,682
|
|
|
|
1,697
|
|
|
|
3,246
|
|
|
|
2,580
|
|
Non-accrual loans
held-for-sale
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
178
|
|
|
|
332
|
|
Troubled debt
restructurings, non-accrual
|
|
|
1,502
|
|
|
|
1,395
|
|
|
|
1,404
|
|
|
|
3,396
|
|
|
|
2,918
|
|
Total non-performing
assets
|
|
$
|
4,436
|
|
|
$
|
4,077
|
|
|
$
|
3,101
|
|
|
$
|
6,820
|
|
|
$
|
5,830
|
|
|
|
(1)
|
June 30, 2017
capital ratios are estimated, subject to regulatory
filings.
|
SUN BANCORP, INC. AND
SUBSIDIARIES
AVERAGE BALANCE SHEETS (Unaudited)
(dollars in thousands)
|
|
|
|
For the Three
Months Ended
|
|
|
For the Three
Months Ended
|
|
|
|
|
June 30,
2017
|
|
|
June 30,
2016
|
|
|
|
|
Average
|
|
|
|
|
|
|
Average
|
|
|
Average
|
|
|
|
|
|
|
Average
|
|
|
|
|
Balance
|
|
|
Interest
|
|
|
Yield/Cost
|
|
|
Balance
|
|
|
Interest
|
|
|
Yield/Cost
|
|
|
Interest-earning
assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans receivable
(1), (2)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Commercial
|
|
$
|
1,288,517
|
|
|
$
|
13,221
|
|
|
|
4.10
|
|
%
|
$
|
1,197,368
|
|
|
$
|
12,141
|
|
|
|
4.06
|
|
%
|
Home equity and
other
|
|
|
114,330
|
|
|
|
1,271
|
|
|
|
4.45
|
|
|
|
136,330
|
|
|
|
1,431
|
|
|
|
4.20
|
|
|
Residential real
estate
|
|
|
202,659
|
|
|
|
1,731
|
|
|
|
3.42
|
|
|
|
240,884
|
|
|
|
2,094
|
|
|
|
3.48
|
|
|
Total loans
receivable
|
|
|
1,605,506
|
|
|
|
16,223
|
|
|
|
4.04
|
|
|
|
1,574,582
|
|
|
|
15,666
|
|
|
|
3.98
|
|
|
Investment
securities
|
|
|
311,935
|
|
|
|
1,781
|
|
|
|
2.28
|
|
|
|
296,811
|
|
|
|
1,673
|
|
|
|
2.25
|
|
|
Interest-earning bank
balances
|
|
|
93,305
|
|
|
|
248
|
|
|
|
1.06
|
|
|
|
125,856
|
|
|
|
159
|
|
|
|
0.51
|
|
|
Total interest-earning
assets
|
|
|
2,010,746
|
|
|
|
18,252
|
|
|
|
3.63
|
|
|
|
1,997,249
|
|
|
|
17,498
|
|
|
|
3.50
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
non-interest-earning assets
|
|
|
221,231
|
|
|
|
|
|
|
|
|
|
|
|
182,151
|
|
|
|
|
|
|
|
|
|
|
Total
assets
|
|
$
|
2,231,977
|
|
|
|
|
|
|
|
|
|
|
$
|
2,179,400
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing
liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing
deposit accounts:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing
demand deposit
|
|
$
|
661,415
|
|
|
|
402
|
|
|
|
0.24
|
|
%
|
$
|
700,857
|
|
|
|
382
|
|
|
|
0.22
|
|
%
|
Savings
deposits
|
|
|
246,895
|
|
|
|
211
|
|
|
|
0.34
|
|
|
|
239,079
|
|
|
|
192
|
|
|
|
0.32
|
|
|
Time
deposits
|
|
|
389,869
|
|
|
|
1,081
|
|
|
|
1.11
|
|
|
|
373,716
|
|
|
|
882
|
|
|
|
0.94
|
|
|
Total interest-bearing
deposit accounts
|
|
|
1,298,179
|
|
|
|
1,694
|
|
|
|
0.52
|
|
|
|
1,313,652
|
|
|
|
1,456
|
|
|
|
0.44
|
|
|
Long-term
borrowings:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FHLBNY
Advances
|
|
|
85,334
|
|
|
|
430
|
|
|
|
2.02
|
|
|
|
85,529
|
|
|
|
429
|
|
|
|
2.01
|
|
|
Obligations under
capital lease
|
|
|
6,127
|
|
|
|
105
|
|
|
|
6.85
|
|
|
|
6,543
|
|
|
|
112
|
|
|
|
6.85
|
|
|
Junior subordinated
debentures
|
|
|
92,616
|
|
|
|
1,161
|
|
|
|
5.01
|
|
|
|
92,786
|
|
|
|
629
|
|
|
|
2.71
|
|
|
Total
borrowings
|
|
|
184,077
|
|
|
|
1,696
|
|
|
|
3.69
|
|
|
|
184,858
|
|
|
|
1,170
|
|
|
|
2.53
|
|
|
Total
interest-bearing liabilities
|
|
|
1,482,256
|
|
|
|
3,390
|
|
|
|
0.91
|
|
|
|
1,498,510
|
|
|
|
2,626
|
|
|
|
0.70
|
|
|
Non-interest-bearing
liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-interest-bearing
demand deposits
|
|
|
409,694
|
|
|
|
|
|
|
|
|
|
|
|
393,922
|
|
|
|
|
|
|
|
|
|
|
Other
liabilities
|
|
|
14,108
|
|
|
|
|
|
|
|
|
|
|
|
24,451
|
|
|
|
|
|
|
|
|
|
|
Total
non-interest-bearing liabilities
|
|
|
423,802
|
|
|
|
|
|
|
|
|
|
|
|
418,373
|
|
|
|
|
|
|
|
|
|
|
Total
liabilities
|
|
|
1,906,058
|
|
|
|
|
|
|
|
|
|
|
|
1,916,883
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shareholders'
equity
|
|
|
325,919
|
|
|
|
|
|
|
|
|
|
|
|
262,517
|
|
|
|
|
|
|
|
|
|
|
Total liabilities and
shareholders' equity
|
|
$
|
2,231,977
|
|
|
|
|
|
|
|
|
|
|
$
|
2,179,400
|
|
|
|
|
|
|
|
|
|
|
Net interest
income
|
|
|
|
|
|
$
|
14,862
|
|
|
|
|
|
|
|
|
|
|
$
|
14,872
|
|
|
|
|
|
|
Interest rate spread
(3)
|
|
|
|
|
|
|
|
|
|
|
2.72
|
|
%
|
|
|
|
|
|
|
|
|
|
2.80
|
|
%
|
Net interest margin
(4)
|
|
|
|
|
|
|
|
|
|
|
2.96
|
|
%
|
|
|
|
|
|
|
|
|
|
2.98
|
|
%
|
Ratio of average
interest-earning assets
to
average interest-bearing liabilities
|
|
|
|
|
|
|
|
|
|
|
136
|
|
%
|
|
|
|
|
|
|
|
|
|
133
|
|
%
|
|
|
(1)
|
Average balances
include non-accrual loans.
|
(2)
|
Loan fees are
included in interest income and the amount is not material for this
analysis.
|
(3)
|
Interest rate spread
represents the difference between the average yield on
interest-earning assets and the average cost of interest-bearing
liabilities.
|
(4)
|
Net interest margin
represents net interest income as a percentage of average
interest-earning assets.
|
SUN BANCORP, INC. AND
SUBSIDIARIES
AVERAGE BALANCE SHEETS (Unaudited)
(dollars in thousands)
|
|
|
|
For the Six Months
Ended
|
|
|
For the Six Months
Ended
|
|
|
|
|
June 30,
2017
|
|
|
June 30,
2016
|
|
|
|
|
Average
|
|
|
|
|
|
|
Average
|
|
|
Average
|
|
|
|
|
|
|
Average
|
|
|
|
|
Balance
|
|
|
Interest
|
|
|
Yield/Cost
|
|
|
Balance
|
|
|
Interest
|
|
|
Yield/Cost
|
|
|
Interest-earning
assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans receivable
(1), (2)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Commercial and
industrial
|
|
$
|
1,279,580
|
|
|
$
|
25,838
|
|
|
|
4.04
|
|
%
|
$
|
1,178,645
|
|
|
$
|
23,570
|
|
|
|
4.00
|
|
%
|
Home equity
|
|
|
116,136
|
|
|
|
2,529
|
|
|
|
4.36
|
|
|
|
139,074
|
|
|
|
2,928
|
|
|
|
4.21
|
|
|
Residential real
estate
|
|
|
206,061
|
|
|
|
3,530
|
|
|
|
3.43
|
|
|
|
244,168
|
|
|
|
4,199
|
|
|
|
3.44
|
|
|
Total loans
receivable
|
|
|
1,601,777
|
|
|
|
31,897
|
|
|
|
3.98
|
|
|
|
1,561,887
|
|
|
|
30,697
|
|
|
|
3.93
|
|
|
Investment securities
(3)
|
|
|
310,108
|
|
|
|
3,588
|
|
|
|
2.31
|
|
|
|
295,963
|
|
|
|
3,390
|
|
|
|
2.29
|
|
|
Interest-earning bank
balances
|
|
|
101,064
|
|
|
|
462
|
|
|
|
0.91
|
|
|
|
136,965
|
|
|
|
345
|
|
|
|
0.50
|
|
|
Total interest-earning
assets
|
|
|
2,012,949
|
|
|
|
35,947
|
|
|
|
3.57
|
|
|
|
1,994,815
|
|
|
|
34,432
|
|
|
|
3.45
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
non-interest-earning assets
|
|
|
223,409
|
|
|
|
|
|
|
|
|
|
|
|
182,792
|
|
|
|
|
|
|
|
|
|
|
Total
assets
|
|
$
|
2,236,358
|
|
|
|
|
|
|
|
|
|
|
$
|
2,177,607
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing
liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing
deposit accounts:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing
demand deposits
|
|
$
|
664,268
|
|
|
|
791
|
|
|
|
0.24
|
|
%
|
$
|
706,214
|
|
|
$
|
741
|
|
|
|
0.21
|
|
%
|
Savings
deposits
|
|
|
243,669
|
|
|
|
412
|
|
|
|
0.34
|
|
|
|
234,102
|
|
|
|
361
|
|
|
|
0.31
|
|
|
Time
deposits
|
|
|
398,556
|
|
|
|
2,177
|
|
|
|
1.09
|
|
|
|
362,744
|
|
|
|
1,646
|
|
|
|
0.91
|
|
|
Total interest-bearing
deposit accounts
|
|
|
1,306,493
|
|
|
|
3,380
|
|
|
|
0.52
|
|
|
|
1,303,060
|
|
|
|
2,748
|
|
|
|
0.42
|
|
|
Short-term
borrowings:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Repurchase agreements
with customers
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
Long-term
borrowings:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FHLBNY
advances
|
|
|
85,359
|
|
|
|
853
|
|
|
|
2.00
|
|
|
|
85,553
|
|
|
|
860
|
|
|
|
2.01
|
|
|
Obligations under
capital lease
|
|
|
6,180
|
|
|
|
212
|
|
|
|
6.86
|
|
|
|
6,592
|
|
|
|
226
|
|
|
|
6.86
|
|
|
Junior subordinated
debentures
|
|
|
92,701
|
|
|
|
1,868
|
|
|
|
4.03
|
|
|
|
92,786
|
|
|
|
1,240
|
|
|
|
2.67
|
|
|
Total
borrowings
|
|
|
184,240
|
|
|
|
2,933
|
|
|
|
3.18
|
|
|
|
184,931
|
|
|
|
2,326
|
|
|
|
2.52
|
|
|
Total
interest-bearing liabilities
|
|
|
1,490,733
|
|
|
|
6,313
|
|
|
|
0.85
|
|
|
|
1,487,991
|
|
|
|
5,074
|
|
|
|
0.68
|
|
|
Non-interest-bearing
liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-interest-bearing
demand deposits
|
|
|
406,340
|
|
|
|
|
|
|
|
|
|
|
|
405,630
|
|
|
|
|
|
|
|
|
|
|
Other
liabilities
|
|
|
14,689
|
|
|
|
|
|
|
|
|
|
|
|
23,042
|
|
|
|
|
|
|
|
|
|
|
Total
non-interest-bearing liabilities
|
|
|
421,029
|
|
|
|
|
|
|
|
|
|
|
|
428,672
|
|
|
|
|
|
|
|
|
|
|
Total
liabilities
|
|
|
1,911,762
|
|
|
|
|
|
|
|
|
|
|
|
1,916,663
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shareholders'
equity
|
|
|
324,596
|
|
|
|
|
|
|
|
|
|
|
|
260,944
|
|
|
|
|
|
|
|
|
|
|
Total liabilities and
shareholders' equity
|
|
$
|
2,236,358
|
|
|
|
|
|
|
|
|
|
|
$
|
2,177,607
|
|
|
|
|
|
|
|
|
|
|
Net interest
income
|
|
|
|
|
|
$
|
29,634
|
|
|
|
|
|
|
|
|
|
|
$
|
29,358
|
|
|
|
|
|
|
Interest rate spread
(4)
|
|
|
|
|
|
|
|
|
|
|
2.72
|
|
%
|
|
|
|
|
|
|
|
|
|
2.77
|
|
%
|
Net interest margin
(5)
|
|
|
|
|
|
|
|
|
|
|
2.94
|
|
%
|
|
|
|
|
|
|
|
|
|
2.94
|
|
%
|
Ratio of average
interest-earning assets
to
average interest-bearing liabilities
|
|
|
|
|
|
|
|
|
|
|
135
|
|
%
|
|
|
|
|
|
|
|
|
|
134
|
|
%
|
|
|
(1)
|
Average balances
include non-accrual loans.
|
(2)
|
Loan fees are
included in interest income and the amount is not material for this
analysis.
|
(3)
|
Interest rate spread
represents the difference between the average yield on
interest-earning assets and the average cost of interest-bearing
liabilities.
|
(4)
|
Net interest margin
represents net interest income as a percentage of average
interest-earning assets.
|
SUN BANCORP, INC. AND
SUBSIDIARIES
AVERAGE BALANCE SHEETS (Unaudited)
(dollars in thousands)
|
|
|
|
For the Three
Months Ended
|
|
|
For the Three
Months Ended
|
|
|
|
|
June 30,
2017
|
|
|
March 31,
2017
|
|
|
|
|
Average
|
|
|
|
|
|
|
Average
|
|
|
Average
|
|
|
|
|
|
|
Average
|
|
|
|
|
Balance
|
|
|
Interest
|
|
|
Yield/Cost
|
|
|
Balance
|
|
|
Interest
|
|
|
Yield/Cost
|
|
|
Interest-earning
assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans receivable
(1), (2)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Commercial
|
|
$
|
1,288,517
|
|
|
$
|
13,221
|
|
|
|
4.10
|
|
%
|
$
|
1,270,543
|
|
|
$
|
12,617
|
|
|
|
3.97
|
|
%
|
Home equity and
other
|
|
|
114,330
|
|
|
|
1,271
|
|
|
|
4.45
|
|
|
|
117,963
|
|
|
|
1,258
|
|
|
|
4.27
|
|
|
Residential real
estate
|
|
|
202,659
|
|
|
|
1,731
|
|
|
|
3.42
|
|
|
|
209,500
|
|
|
|
1,799
|
|
|
|
3.43
|
|
|
Total loans
receivable
|
|
|
1,605,506
|
|
|
|
16,223
|
|
|
|
4.04
|
|
|
|
1,598,006
|
|
|
|
15,674
|
|
|
|
3.92
|
|
|
Investment
securities
|
|
|
311,935
|
|
|
|
1,781
|
|
|
|
2.28
|
|
|
|
308,261
|
|
|
|
1,807
|
|
|
|
2.34
|
|
|
Interest-earning bank
balances
|
|
|
93,305
|
|
|
|
248
|
|
|
|
1.06
|
|
|
|
108,910
|
|
|
|
215
|
|
|
|
0.79
|
|
|
Total interest-earning
assets
|
|
|
2,010,746
|
|
|
|
18,252
|
|
|
|
3.63
|
|
|
|
2,015,177
|
|
|
|
17,696
|
|
|
|
3.51
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
non-interest-earning assets
|
|
|
221,232
|
|
|
|
|
|
|
|
|
|
|
|
225,610
|
|
|
|
|
|
|
|
|
|
|
Total
assets
|
|
$
|
2,231,978
|
|
|
|
|
|
|
|
|
|
|
$
|
2,240,787
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing
liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing
deposit accounts:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing
demand deposits
|
|
$
|
661,415
|
|
|
|
402
|
|
|
|
0.24
|
|
%
|
$
|
667,152
|
|
|
$
|
389
|
|
|
|
0.23
|
|
%
|
Savings
deposits
|
|
|
246,895
|
|
|
|
211
|
|
|
|
0.34
|
|
|
|
240,407
|
|
|
|
201
|
|
|
|
0.33
|
|
|
Time
deposits
|
|
|
389,869
|
|
|
|
1,081
|
|
|
|
1.11
|
|
|
|
407,340
|
|
|
|
1,096
|
|
|
|
1.08
|
|
|
Total interest-bearing
deposit accounts
|
|
|
1,298,179
|
|
|
|
1,694
|
|
|
|
0.52
|
|
|
|
1,314,899
|
|
|
|
1,686
|
|
|
|
0.51
|
|
|
Long-term
borrowings:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FHLB
advances
|
|
|
85,334
|
|
|
|
430
|
|
|
|
2.02
|
|
|
|
85,384
|
|
|
|
424
|
|
|
|
1.99
|
|
|
Obligations under
capital lease
|
|
|
6,127
|
|
|
|
105
|
|
|
|
6.85
|
|
|
|
6,234
|
|
|
|
107
|
|
|
|
6.87
|
|
|
Junior subordinated
debentures
|
|
|
92,616
|
|
|
|
1,161
|
|
|
|
5.01
|
|
|
|
92,786
|
|
|
|
707
|
|
|
|
3.05
|
|
|
Total
borrowings
|
|
|
184,077
|
|
|
|
1,696
|
|
|
|
3.69
|
|
|
|
184,404
|
|
|
|
1,238
|
|
|
|
2.69
|
|
|
Total
interest-bearing liabilities
|
|
|
1,482,256
|
|
|
|
3,390
|
|
|
|
0.91
|
|
|
|
1,499,303
|
|
|
|
2,924
|
|
|
|
0.78
|
|
|
Non-interest-bearing
liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-interest-bearing
demand deposits
|
|
|
409,694
|
|
|
|
|
|
|
|
|
|
|
|
402,949
|
|
|
|
|
|
|
|
|
|
|
Other
liabilities
|
|
|
14,108
|
|
|
|
|
|
|
|
|
|
|
|
15,277
|
|
|
|
|
|
|
|
|
|
|
Total
non-interest-bearing liabilities
|
|
|
423,802
|
|
|
|
|
|
|
|
|
|
|
|
418,226
|
|
|
|
|
|
|
|
|
|
|
Total
liabilities
|
|
|
1,906,058
|
|
|
|
|
|
|
|
|
|
|
|
1,917,529
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shareholders'
equity
|
|
|
325,919
|
|
|
|
|
|
|
|
|
|
|
|
323,258
|
|
|
|
|
|
|
|
|
|
|
Total liabilities and
shareholders' equity
|
|
$
|
2,231,977
|
|
|
|
|
|
|
|
|
|
|
$
|
2,240,787
|
|
|
|
|
|
|
|
|
|
|
Net interest
income
|
|
|
|
|
|
$
|
14,862
|
|
|
|
|
|
|
|
|
|
|
$
|
14,772
|
|
|
|
|
|
|
Interest rate spread
(3)
|
|
|
|
|
|
|
|
|
|
|
2.72
|
|
%
|
|
|
|
|
|
|
|
|
|
2.73
|
|
%
|
Net interest margin
(4)
|
|
|
|
|
|
|
|
|
|
|
2.96
|
|
%
|
|
|
|
|
|
|
|
|
|
2.93
|
|
%
|
Ratio of average
interest-earning assets
to
average interest-bearing liabilities
|
|
|
|
|
|
|
|
|
|
|
136
|
|
%
|
|
|
|
|
|
|
|
|
|
134
|
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Average balances
include non-accrual loans.
|
(2)
|
Loan fees are
included in interest income and the amount is not material for this
analysis.
|
(3)
|
Interest rate spread
represents the difference between the average yield on
interest-earning assets and the average cost of interest-bearing
liabilities.
|
(4)
|
Net interest margin
represents net interest income as a percentage of average
interest-earning assets.
|
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SOURCE Sun Bancorp, Inc.