Key Highlights - Second Quarter 2022
- Generated adjusted net income of $63
million, or $1.17 per diluted
share, excluding merger-related costs.
- Expanded net interest margin by 58 basis points to 3.69
percent.
- Grew average commercial loans, excluding warehouse loans, by 9
percent compared to the first quarter.
- Expanded portfolio of loans serviced or subserviced by 10
percent to nearly 1.4 million accounts and $0.3 trillion in UPB.
- Maintained strong asset quality with no nonperforming
commercial loans at quarter-end and a 42 percent reduction in
forbearance-related delinquent loans.
TROY,
Mich., July 27, 2022 /PRNewswire/ -- Flagstar
Bancorp, Inc. (NYSE: FBC), the holding company for Flagstar Bank,
today reported second quarter 2022 net income of $60 million, or $1.12 per diluted share, compared to first
quarter 2022 net income of $53
million, or $0.99 per diluted
share, and second quarter 2021 net income of $147 million, or $2.74 per diluted share. On an adjusted basis,
Flagstar reported net income of $63
million, or $1.17 per diluted
share, for the second quarter 2022.
"This quarter demonstrated the strength of our community bank as
we grew net interest income and net interest margin and benefited
from the rising rate environment," said Alessandro DiNello, president and chief
executive officer of Flagstar Bancorp. "Our banking and servicing
segments prospered, which allowed us to grow earnings by 13 percent
compared to the first quarter.
"Net interest margin for Q2 was 3.69 percent — a 58 basis point
improvement over the first quarter, now the highest net interest
margin we have ever reported. This momentum in net interest margin
continued into June where it reached 3.88 percent. Net interest
income grew $28 million, or 17
percent, reflecting a full quarter's impact of our asset
sensitivity strategies. We also grew our commercial loan portfolio
by 9 percent, excluding warehouse. Additionally, our bankers
maintained outstanding discipline on the deposit side of the
balance sheet.
"Rising rates also helped us deliver a strong 16 percent return
this quarter on our mortgage servicing rights portfolio.
Additionally, we continue to grow our fee-generating servicing
business as our portfolio of loans serviced or subserviced
increased by 10 percent to nearly 1.4 million accounts.
"We faced continued pressure in mortgage revenue due to the
unprecedented increases in mortgage rates and much lower volumes in
retail, which is our highest margin channel. We expect the mortgage
market to remain challenging for the foreseeable future, and we
will continue to use our market position and scale to take the
necessary actions to succeed in our unwavering commitment to
profitability.
"Credit quality continues to hold up well. Our only
nonperforming commercial credit returned to accrual status in the
quarter and we saw a meaningful improvement in forbearance-related
delinquencies. As a result, our allowance for credit losses
decreased by $10 million, even with
our growth in commercial loans.
"Our performance in the second quarter once again demonstrates
the ability of our business model to deliver profits under any
economic scenario. We're operating in the most unfavorable mortgage
environment I have seen in my nine years as CEO, yet we produced a
1.0 percent return on assets largely on the strength of our banking
and servicing businesses and our quick pivot to contain costs on
the mortgage side. Given these results, I continue to be excited
about the prospects for our performance for full year 2022."
|
Income Statement
Highlights
|
|
|
|
|
|
Three Months
Ended
|
|
June 30,
2022
|
March 31,
2022
|
December 31,
2021
|
September 30,
2021
|
June 30,
2021
|
|
(Dollars in millions,
except per share data)
|
|
Net interest
income
|
$
193
|
$
165
|
$
181
|
$
195
|
$
183
|
|
Benefit for credit
losses
|
(9)
|
(4)
|
(17)
|
(23)
|
(44)
|
|
Noninterest
income
|
131
|
160
|
202
|
266
|
252
|
|
Noninterest
expense
|
256
|
261
|
291
|
286
|
289
|
|
Income before income
taxes
|
77
|
68
|
109
|
198
|
190
|
|
Provision for income
taxes
|
17
|
15
|
24
|
46
|
43
|
|
Net income
|
$
60
|
$
53
|
$
85
|
$
152
|
$
147
|
|
|
|
|
|
|
|
Income per
share:
|
|
|
|
|
|
|
Basic
|
$
1.13
|
$
0.99
|
$
1.62
|
$
2.87
|
$
2.78
|
|
Diluted
|
$
1.12
|
$
0.99
|
$
1.60
|
$
2.83
|
$
2.74
|
|
Adjusted Income
Statement Highlights (Non-GAAP)(1)
|
|
|
|
|
|
Three Months
Ended
|
|
June 30,
2022
|
March 31,
2022
|
December 31,
2021
|
September 30,
2021
|
June 30,
2021
|
|
(Dollars in millions,
except per share data)
|
|
Net interest
income
|
$
193
|
$
165
|
$
181
|
$
195
|
$
183
|
|
Benefit for credit
losses
|
(9)
|
(4)
|
(17)
|
(23)
|
(44)
|
|
Noninterest
income
|
131
|
160
|
202
|
266
|
252
|
|
Noninterest
expense
|
253
|
258
|
285
|
281
|
290
|
|
Income before income
taxes
|
80
|
71
|
115
|
203
|
189
|
|
Provision for income
taxes
|
17
|
16
|
25
|
47
|
43
|
|
Net income
|
$
63
|
$
55
|
$
90
|
$
156
|
$
146
|
|
|
|
|
|
|
|
Income per
share:
|
|
|
|
|
|
|
Basic
|
$
1.18
|
$
1.03
|
$
1.71
|
$
2.94
|
$
2.78
|
|
Diluted
|
$
1.17
|
$
1.02
|
$
1.69
|
$
2.90
|
$
2.74
|
|
(1) See Non-GAAP
Reconciliation for further information.
|
|
Key
Ratios
|
|
|
|
|
|
Three Months
Ended
|
|
June 30,
2022
|
March 31,
2022
|
December 31,
2021
|
September 30,
2021
|
June 30,
2021
|
|
Net interest
margin
|
3.69 %
|
3.11 %
|
2.96 %
|
3.00 %
|
2.90 %
|
|
Return on average
assets
|
1.0 %
|
0.9 %
|
1.3 %
|
2.2 %
|
2.1 %
|
|
Return on average
common equity
|
8.7 %
|
7.9 %
|
12.7 %
|
23.4 %
|
24.0 %
|
|
Efficiency
ratio
|
79.1 %
|
80.4 %
|
75.9 %
|
62.2 %
|
66.6 %
|
|
HFI loan-to-deposit
ratio
|
76.3 %
|
68.5 %
|
67.2 %
|
68.8 %
|
71.8 %
|
|
Adjusted HFI
loan-to-deposit ratio (1)
|
71.9 %
|
64.1 %
|
60.5 %
|
60.3 %
|
64.3 %
|
|
(1) Excludes warehouse
loans and custodial deposits. See Non-GAAP Reconciliation for
further information.
|
|
Average Balance
Sheet Highlights
|
|
|
|
|
|
|
|
Three Months
Ended
|
%
Change
|
|
June 30,
2022
|
March 31,
2022
|
December 31,
2021
|
June 30,
2021
|
June 30,
2021
|
Seq
|
Yr/Yr
|
|
(Dollars in
millions)
|
|
|
|
Average
interest-earning assets
|
$
20,958
|
$
21,569
|
$
24,291
|
$
25,656
|
$
25,269
|
(3) %
|
(17) %
|
|
Average loans
held-for-sale (LHFS)
|
3,571
|
4,833
|
6,384
|
7,839
|
6,902
|
(26) %
|
(48) %
|
|
Average loans
held-for-investment (LHFI)
|
13,339
|
12,384
|
13,314
|
13,540
|
13,688
|
8 %
|
(3) %
|
|
Average total
deposits
|
17,488
|
18,089
|
19,816
|
19,686
|
19,070
|
(3) %
|
(8) %
|
Net Interest Income
Net interest income in the second quarter was $193 million, an increase of $28 million, or
17 percent, as compared to the first quarter 2022. The results
primarily reflect an increase in net interest margin which was
partially offset by a $0.6 billion,
or 3 percent, net decrease in average earning assets. We grew our
loans held for investment by $1.0
billion, led by our commercial portfolio. This growth was
more than offset by a $1.3 billion
decrease in our mortgage loans held-for-sale driven by lower
mortgage volume.
Net interest margin in the second quarter was 3.69 percent, a 58
basis points increase compared to 3.11 percent in the prior
quarter. The net interest margin expansion was largely attributable
to our asset sensitivity, higher rates on newly purchased
investment securities and a lag on deposit pricing increases.
Average total deposits were $17.5
billion in the second quarter, down $0.6 billion, or 3 percent, from the first
quarter 2022, largely due to a decrease of $0.3 billion, or 7 percent, in average custodial
deposits and a $0.2 billion, or 10
percent, decrease in government deposits. Total interest earning
deposit costs only increased 2 basis points as we remained
disciplined on our deposit pricing.
Provision for Credit Losses
The benefit from credit losses was $9
million for the second quarter, as compared to a
$4 million benefit for the first
quarter 2022, reflecting the strong performance of our portfolio,
low number of non-accrual loans and a meaningful improvement in
forbearance-related delinquencies. At June 30, 2022, there
were no commercial delinquencies or nonaccrual loans.
Noninterest Income
Noninterest income decreased to $131
million in the second quarter, as compared to $160 million for the first quarter 2022,
primarily due to lower gain on sale.
Second quarter net gain on loan sales decreased $18 million, to $27
million, as compared to $45
million in the first quarter 2022. Gain on sale margins
decreased 19 basis points to 39 basis points for the second quarter
2022, compared to 58 basis points for the first quarter 2022. The
decrease was caused by a $1.1
billion, or 47 percent, decline in our retail volume. This
decline was primarily in the direct-to-consumer channel as a result
of lower refinance volumes caused by the rising rate
environment.
Our mortgage servicing rights portfolio yielded an annualized 16
percent return for the quarter. The net return on mortgage
servicing rights decreased $7 million to $22 million for the second quarter 2022, compared
to a $29 million net return for the
first quarter 2022.
Loan administration income was $33
million for the second quarter 2022, consistent with the
first quarter 2022. During the quarter, higher income from a 10
percent increase in loans serviced or subserviced for others was
offset by higher LIBOR-based fees paid on custodial deposits that
are subserviced.
Loan fees and charges increased $2 million to $29 million for the second quarter, compared to
$27 million for the first quarter
2022, primarily due to higher ancillary fee income from our
servicing business.
|
Mortgage
Metrics
|
|
|
|
|
|
|
|
As of/Three Months
Ended
|
Change (% /
bps)
|
|
June 30,
2022
|
March 31,
2022
|
December 31,
2021
|
September 30,
2021
|
June 30,
2021
|
Seq
|
Yr/Yr
|
|
(Dollars in
millions)
|
|
|
|
Mortgage rate lock
commitments (fallout-adjusted) (1) (2)
|
$
7,100
|
$
7,700
|
$
8,900
|
$
11,300
|
$ 12,400
|
(9) %
|
(43) %
|
|
Mortgage loans closed
(1)
|
$
7,700
|
$
8,200
|
$ 10,700
|
$
12,500
|
$ 12,800
|
(6) %
|
(40) %
|
|
Net margin on mortgage
rate lock commitments (fallout-adjusted) (2)
|
0.39 %
|
0.58 %
|
1.02 %
|
1.50 %
|
1.35 %
|
(19)
|
(96)
|
|
Net gain on loan
sales
|
$
27
|
$
45
|
$
91
|
$
169
|
$
168
|
(40) %
|
(84) %
|
|
Net return (loss) on
mortgage servicing rights (MSR)
|
$
22
|
$
29
|
$
19
|
$
9
|
$
(5)
|
N/M
|
N/M
|
|
Gain on loan sales +
net return on the MSR
|
$
49
|
$
74
|
$
110
|
$
178
|
$
163
|
(34) %
|
(70) %
|
|
Loans serviced (number
of accounts - 000's) (3)
|
1,383
|
1,256
|
1,234
|
1,203
|
1,182
|
10 %
|
17 %
|
|
Capitalized value of
MSRs
|
1.50 %
|
1.31 %
|
1.12 %
|
1.08 %
|
1.00 %
|
19
|
50
|
|
N/M - Not
meaningful
|
|
|
|
|
|
|
|
|
(1)
Rounded to the nearest hundred million
|
|
(2)
Fallout-adjusted mortgage rate lock commitments are adjusted by a
percentage of mortgage loans in the pipeline that are not expected
to close based
on previous
historical experience and the level of interest rates.
|
|
(3)
Includes loans serviced for Flagstar's own loan portfolio, serviced
for others, and subserviced for others.
|
Noninterest Expense
Noninterest expense decreased to $256
million for the second quarter, compared to $261 million for the first quarter 2022.
Excluding $3 million of merger costs
in the first two quarters of 2022, noninterest expense decreased
$5 million, or 2 percent, primarily
driven by lower compensation and benefits.
Mortgage expenses were $90 million
for the second quarter, a decrease of $11 million compared to
the prior quarter. The ratio of mortgage expenses to closings—our
mortgage expense ratio— was 1.14 percent, a decrease of 9 basis
points from the first quarter 2022. The reduction in expense was
primarily driven by the actions we have taken and continue to take
to reduce mortgage costs.
The efficiency ratio was 79 percent for the second quarter, as
compared to 80 percent for the first quarter 2022. Excluding
$3 million of merger expenses in the
first two quarters of 2022, the adjusted efficiency ratio was 78
percent and 80 percent, respectively.
Income Taxes
The second quarter provision for income taxes totaled
$17 million, with an effective tax
rate of 21.7 percent, consistent with the effective tax rate for
the first quarter 2022.
Asset Quality
|
Credit Quality
Ratios
|
|
|
|
|
|
|
|
As of/Three Months
Ended
|
Change (% /
bps)
|
|
June 30,
2022
|
March 31,
2022
|
December 31,
2021
|
September 30,
2021
|
June 30,
2021
|
Seq
|
Yr/Yr
|
|
(Dollars in
millions)
|
|
|
|
Allowance for credit
losses (1)
|
$
135
|
$
145
|
$
170
|
$
190
|
$
220
|
(7) %
|
(39) %
|
|
Credit reserves to
LHFI
|
0.92 %
|
1.10 %
|
1.27 %
|
1.33 %
|
1.57 %
|
(18)
|
-65
|
|
Credit reserves to LHFI
excluding warehouse
|
1.27 %
|
1.64 %
|
1.96 %
|
2.29 %
|
2.63 %
|
(37)
|
(136)
|
|
Net
charge-offs
|
$
1
|
$
21
|
$
3
|
$
6
|
$
1
|
(95) %
|
— %
|
|
Total nonperforming
LHFI and TDRs
|
$
99
|
$
107
|
$
94
|
$
96
|
$
75
|
(7) %
|
32 %
|
|
Net charge-offs to LHFI
ratio (annualized)
|
0.03 %
|
0.69 %
|
0.08 %
|
0.19 %
|
0.01 %
|
(66)
|
2
|
|
Ratio of nonperforming
LHFI and TDRs to LHFI
|
0.68 %
|
0.80 %
|
0.70 %
|
0.66 %
|
0.53 %
|
(12)
|
15
|
|
|
|
|
|
|
|
|
|
Net
charge-offs/(recoveries) to LHFI ratio (annualized) by loan type
(2):
|
|
|
|
Residential first
mortgage
|
0.12 %
|
0.31 %
|
0.04 %
|
— %
|
0.16 %
|
(19)
|
(4)
|
|
Home equity and other
consumer
|
0.09 %
|
0.07 %
|
0.14 %
|
0.01 %
|
0.15 %
|
2
|
(6)
|
|
Commercial real
estate
|
— %
|
— %
|
— %
|
0.03 %
|
— %
|
—
|
—
|
|
Commercial and
industrial
|
0.02 %
|
4.31 %
|
0.53 %
|
1.87 %
|
0.04 %
|
(429)
|
(2)
|
|
N/M - Not
meaningful
|
|
|
|
|
|
|
|
|
(1) Includes the allowance for loan losses
and the reserve on unfunded commitments.
|
|
(2) Excludes loans carried under the fair
value option.
|
Our portfolio has continued to hold up well following the
economic stress posed by the pandemic, resulting in less than
$1 million of net charge-offs
totaling, 3 basis points of LHFI in the second quarter 2022. This
compares to net charge-offs of $21
million, or 69 basis points, in the prior quarter which was
substantially all from one commercial borrower.
Nonperforming loans held-for-investment and troubled debt
restructurings (TDRs) were $99
million at the end of the second quarter, a decrease of
$8 million as compared to the first
quarter 2022. Our ratio of nonperforming loans held-for-investment
and TDRs to loans held-for-investment was 68 basis points at
June 30, 2022, a 12 basis point decrease compared to
March 31, 2022. At June 30,
2022, early stage loan delinquencies totaled $22 million, or 15 basis points of total loans,
compared to $22 million, or 17 basis
points, at March 31, 2022.
The allowance for credit losses was $135 million and
covered 0.92 percent of loans held-for-investment at June 30,
2022, an 18 basis point decrease from March
31, 2022. Excluding warehouse loans, the allowance coverage
ratio was 1.27 percent, a 37 basis point decrease from March 31, 2022. The 7 percent decrease in the
allowance for credit losses reflects a reduction in reserves for
our loans with government guarantees as a result of pay-offs and
improvements in the delinquency trends of expired forbearance
loans. Loan growth occurred in well-collateralized portfolios,
including residential first mortgage and MSR loans (included in our
C&I portfolio) with lower reserve levels. The impact of this
loan growth was offset by improvements in portfolio credit quality,
primarily upgrades to certain C&I loans and improvements in our
residential loss severity estimates. Overall, our portfolio quality
remains solid with low levels of nonperforming loans and low
delinquency levels, including no commercial delinquencies.
Capital
|
Capital Ratios
(Bancorp)
|
|
Change (% /
bps)
|
|
June 30,
2022
|
March 31,
2022
|
December 31,
2021
|
September 30,
2021
|
June 30,
2021
|
Seq
|
Yr/Yr
|
|
Tier 1 leverage (to
adj. avg. total assets)
|
12.17 %
|
11.83 %
|
10.54 %
|
9.72 %
|
9.21 %
|
34
|
296
|
|
Tier 1 common equity
(to RWA)
|
13.22 %
|
13.89 %
|
13.19 %
|
11.95 %
|
11.38 %
|
(67)
|
184
|
|
Tier 1 capital (to
RWA)
|
14.41 %
|
15.17 %
|
14.43 %
|
13.11 %
|
12.56 %
|
(76)
|
185
|
|
Total capital (to
RWA)
|
15.68 %
|
16.59 %
|
15.88 %
|
14.55 %
|
14.13 %
|
(91)
|
155
|
|
Tangible common equity
to asset ratio (1)
|
10.25 %
|
11.13 %
|
10.09 %
|
9.23 %
|
8.67 %
|
(88)
|
158
|
|
Tangible book value per
share (1)
|
$
47.83
|
$
48.61
|
$
48.33
|
$
47.21
|
$
44.38
|
(2) %
|
8 %
|
|
(1) See Non-GAAP Reconciliation
for further information.
|
We maintained a strong capital position with regulatory ratios
above current regulatory quantitative guidelines for "well
capitalized" institutions. Further demonstrating our capital
strength, the capital ratios are impacted by a 100 percent
risk-weighting of the warehouse loan portfolio—the largest
component of the held-for-investment portfolio. Adjusting the
risk-weighting of warehouse loans to 50 percent because of
historically low levels of losses from this portfolio, coupled with
the fact that the portfolio is fully collateralized with assets
that would receive a 50 percent risk weighting, we would have had a
tier 1 common equity ratio of 14.71 percent and a total risk-based
capital ratio of 17.45 percent at June 30, 2022.
Tangible book value per share declined to $47.83, down $0.78,
or 2 percent from last quarter due to a $97 million decline in
other comprehensive income primarily driven by the impact of higher
interest rates on our investment securities portfolio.
About Flagstar
Flagstar Bancorp, Inc. (NYSE: FBC) is a $24.9 billion savings and loan holding
company headquartered in Troy,
Mich. Flagstar Bank, FSB, provides commercial, small
business, and consumer banking services through 158 branches in
Michigan, Indiana, California, Wisconsin and Ohio. It also provides home loans through a
wholesale network of brokers and correspondents in all 50 states,
as well as 79 retail locations in 28 states. Flagstar is a leading
national originator and servicer of mortgage and other consumer
loans, handling payments and record keeping for $343 billion
of loans representing almost 1.4 million borrowers. For more
information, please visit flagstar.com.
Use of Non-GAAP Financial Measures
In addition to results presented in accordance with GAAP, this
news release includes certain non-GAAP financial measures. The
Company believes these non-GAAP financial measures provide
additional information that is useful to investors in helping to
understand the capital requirements Flagstar will face in the
future and underlying performance and trends of Flagstar.
Non-GAAP financial measures have inherent limitations. Readers
should be aware of these limitations and should be cautious with
respect to the use of such measures. To compensate for these
limitations, we use non-GAAP measures as comparative tools,
together with GAAP measures, to assist in the evaluation of our
operating performance or financial condition. Also, we ensure that
these measures are calculated using the appropriate GAAP or
regulatory components in their entirety and that they are computed
in a manner intended to facilitate consistent period-to-period
comparisons. Flagstar's method of calculating these non-GAAP
measures may differ from methods used by other companies. These
non-GAAP measures should not be considered in isolation or as a
substitute for those financial measures prepared in accordance with
GAAP or in-effect regulatory requirements.
Where non-GAAP financial measures are used, the most directly
comparable GAAP or regulatory financial measure, as well as the
reconciliation to the most directly comparable GAAP or regulatory
financial measure, can be found in this news release. Additional
discussion of the use of non-GAAP measures can also be found in
periodic Flagstar reports filed with the U.S. Securities and
Exchange Commission, which are available on the Company's website
at flagstar.com.
Cautionary Statements Regarding Forward-Looking Statements
Certain statements in this press release may constitute
"forward‐looking statements" within the meaning of the Private
Securities Litigation Reform Act of 1995, Section 27A of the
Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended, with respect to
Flagstar's beliefs, goals, intentions, and expectations regarding
revenues, earnings, loan production, asset quality, capital levels,
and acquisitions, among other matters; Flagstar's estimates of
future costs and benefits of the actions each company may take;
Flagstar's assessments of probable losses on loans; Flagstar's
assessments of interest rate and other market risks; and Flagstar's
ability to achieve their respective financial and other strategic
goals. Forward‐looking statements are typically identified by such
words as "believe," "expect," "anticipate," "intend," "outlook,"
"estimate," "forecast," "project," "should," and other similar
words and expressions, and are subject to numerous assumptions,
risks, and uncertainties, which change over time. Forward‐looking
statements speak only as of the date they are made; Flagstar does
not assume any duty, and does not undertake, to update such
forward‐looking statements. Furthermore, because forward‐looking
statements are subject to assumptions and uncertainties, actual
results or future events could differ, possibly materially, from
those indicated in such forward-looking statements depending upon
various factors as described in the "Risk Factors" section in
Flagstar's Annual Report on Form 10-K for the year ended
December 31, 2021 and in Flagstar's
other filings with SEC, which are available at http://www.sec.gov
and in the "Documents" section of Flagstar's website,
https://investors.flagstar.com.
|
Flagstar Bancorp,
Inc.
Consolidated Statements of Financial
Condition
(Dollars in millions)
(Unaudited)
|
|
|
June 30,
2022
|
|
March 31,
2022
|
|
December 31,
2021
|
|
June 30,
2021
|
|
Assets
|
|
|
|
|
|
|
|
|
Cash
|
$
198
|
|
$
174
|
|
$
277
|
|
$
168
|
|
Interest-earning
deposits
|
237
|
|
231
|
|
774
|
|
177
|
|
Total cash and
cash equivalents
|
435
|
|
405
|
|
1,051
|
|
345
|
|
Investment securities
available-for-sale
|
2,346
|
|
2,010
|
|
1,804
|
|
1,823
|
|
Investment securities
held-to-maturity
|
173
|
|
190
|
|
205
|
|
270
|
|
Loans
held-for-sale
|
3,482
|
|
3,475
|
|
5,054
|
|
6,138
|
|
Loans
held-for-investment
|
14,655
|
|
13,236
|
|
13,408
|
|
14,052
|
|
Loans with government
guarantees
|
1,144
|
|
1,256
|
|
1,650
|
|
2,226
|
|
Less: allowance for
loan losses
|
(122)
|
|
(131)
|
|
(154)
|
|
(202)
|
|
Total loans
held-for-investment and loans with government guarantees,
net
|
15,677
|
|
14,361
|
|
14,904
|
|
16,076
|
|
Mortgage servicing
rights
|
622
|
|
523
|
|
392
|
|
342
|
|
Federal Home Loan Bank
stock
|
329
|
|
329
|
|
377
|
|
377
|
|
Premises and
equipment, net
|
354
|
|
354
|
|
360
|
|
374
|
|
Goodwill and
intangible assets
|
142
|
|
145
|
|
147
|
|
152
|
|
Bank-owned life
insurance
|
370
|
|
367
|
|
365
|
|
361
|
|
Other
assets
|
969
|
|
1,085
|
|
824
|
|
807
|
|
Total
assets
|
$
24,899
|
|
$
23,244
|
|
$
25,483
|
|
$
27,065
|
|
Liabilities and
Stockholders' Equity
|
|
|
|
|
|
|
|
|
Noninterest-bearing
deposits
|
$
6,664
|
|
$
6,827
|
|
$
7,088
|
|
$
7,986
|
|
Interest-bearing
deposits
|
9,984
|
|
10,521
|
|
10,921
|
|
10,675
|
|
Total
deposits
|
16,648
|
|
17,348
|
|
18,009
|
|
18,661
|
|
Short-term Federal
Home Loan Bank advances and other
|
3,301
|
|
200
|
|
1,880
|
|
2,095
|
|
Long-term Federal Home
Loan Bank advances
|
700
|
|
1,200
|
|
1,400
|
|
1,200
|
|
Other long-term
debt
|
394
|
|
396
|
|
396
|
|
396
|
|
Loan with government
guarantees repurchase liability
|
101
|
|
63
|
|
200
|
|
989
|
|
Other
liabilities
|
1,062
|
|
1,304
|
|
880
|
|
1,226
|
|
Total
liabilities
|
22,206
|
|
20,511
|
|
22,765
|
|
24,567
|
|
Stockholders'
Equity
|
|
|
|
|
|
|
|
|
Common
stock
|
1
|
|
1
|
|
1
|
|
1
|
|
Additional paid in
capital
|
1,358
|
|
1,357
|
|
1,355
|
|
1,356
|
|
Accumulated other
comprehensive income
|
(99)
|
|
(2)
|
|
35
|
|
45
|
|
Retained
earnings
|
1,433
|
|
1,377
|
|
1,327
|
|
1,096
|
|
Total
stockholders' equity
|
2,693
|
|
2,733
|
|
2,718
|
|
2,498
|
|
Total
liabilities and stockholders' equity
|
$
24,899
|
|
$
23,244
|
|
$
25,483
|
|
$
27,065
|
|
Flagstar Bancorp,
Inc.
Condensed Consolidated Statements of
Operations
(Dollars in millions, except per share data)
(Unaudited)
|
|
|
|
Change compared
to:
|
|
Three Months
Ended
|
|
1Q22
|
|
2Q21
|
|
June 30,
2022
|
March 31,
2022
|
December 31,
2021
|
September 30,
2021
|
June 30,
2021
|
|
Amount
|
Percent
|
|
Amount
|
Percent
|
|
Interest
Income
|
|
|
|
|
|
|
|
|
|
|
|
|
Total interest
income
|
$
209
|
$
177
|
$
196
|
$
209
|
$
198
|
|
$ 32
|
18 %
|
|
$ 11
|
6 %
|
|
Total interest
expense
|
16
|
12
|
15
|
14
|
15
|
|
4
|
33 %
|
|
1
|
7 %
|
|
Net interest
income
|
193
|
165
|
181
|
195
|
183
|
|
28
|
17 %
|
|
10
|
5 %
|
|
(Benefit) provision
for credit losses
|
(9)
|
(4)
|
(17)
|
(23)
|
(44)
|
|
(5)
|
N/M
|
|
35
|
(80) %
|
|
Net interest
income after provision for credit losses
|
202
|
169
|
198
|
218
|
227
|
|
33
|
20 %
|
|
(25)
|
(11) %
|
|
Noninterest
Income
|
|
|
|
|
|
|
|
|
|
|
|
|
Net gain on loan
sales
|
27
|
45
|
91
|
169
|
168
|
|
(18)
|
(40) %
|
|
(141)
|
(84) %
|
|
Loan fees and
charges
|
29
|
27
|
29
|
33
|
37
|
|
2
|
7 %
|
|
(8)
|
(22) %
|
|
Net return (loss) on
the mortgage servicing rights
|
22
|
29
|
19
|
9
|
(5)
|
|
(7)
|
(24) %
|
|
27
|
N/M
|
|
Loan administration
income
|
33
|
33
|
36
|
31
|
28
|
|
—
|
— %
|
|
5
|
18 %
|
|
Deposit fees and
charges
|
9
|
9
|
8
|
9
|
8
|
|
—
|
— %
|
|
1
|
13 %
|
|
Other noninterest
income
|
11
|
17
|
19
|
15
|
16
|
|
(6)
|
(35) %
|
|
(5)
|
(31) %
|
|
Total
noninterest income
|
131
|
160
|
202
|
266
|
252
|
|
(29)
|
(18) %
|
|
(121)
|
(48) %
|
|
Noninterest
Expense
|
|
|
|
|
|
|
|
|
|
|
|
|
Compensation and
benefits
|
122
|
127
|
137
|
130
|
122
|
|
(5)
|
(4) %
|
|
—
|
— %
|
|
Occupancy and
equipment
|
46
|
45
|
47
|
46
|
50
|
|
1
|
2 %
|
|
(4)
|
(8) %
|
|
Commissions
|
22
|
26
|
38
|
44
|
51
|
|
(4)
|
(15) %
|
|
(29)
|
(57) %
|
|
Loan processing
expense
|
23
|
21
|
21
|
22
|
22
|
|
2
|
10 %
|
|
1
|
5 %
|
|
Legal and professional
expense
|
10
|
11
|
13
|
12
|
11
|
|
(1)
|
(9) %
|
|
(1)
|
(9) %
|
|
Federal insurance
premiums
|
4
|
4
|
4
|
6
|
4
|
|
—
|
— %
|
|
—
|
— %
|
|
Intangible asset
amortization
|
3
|
2
|
3
|
3
|
3
|
|
1
|
50 %
|
|
—
|
— %
|
|
Other noninterest
expense
|
26
|
25
|
28
|
23
|
26
|
|
1
|
4 %
|
|
—
|
— %
|
|
Total
noninterest expense
|
256
|
261
|
291
|
286
|
289
|
|
(5)
|
(2) %
|
|
(33)
|
(11) %
|
|
Income before income
taxes
|
77
|
68
|
109
|
198
|
190
|
|
9
|
13 %
|
|
(113)
|
(59) %
|
|
Provision for income
taxes
|
17
|
15
|
24
|
46
|
43
|
|
2
|
13 %
|
|
(26)
|
(60) %
|
|
Net income
|
$
60
|
$
53
|
$
85
|
$
152
|
$
147
|
|
$
7
|
13 %
|
|
$ (87)
|
(59) %
|
|
Income per
share
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
$
1.13
|
$
0.99
|
$
1.62
|
$
2.87
|
$
2.78
|
|
$
0.14
|
14 %
|
|
$
(1.65)
|
(59) %
|
|
Diluted
|
$
1.12
|
$
0.99
|
$
1.60
|
$
2.83
|
$
2.74
|
|
$
0.13
|
13 %
|
|
$
(1.62)
|
(59) %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash dividends
declared
|
$
0.06
|
$
0.06
|
$
0.06
|
$
0.06
|
$
0.06
|
|
$ —
|
— %
|
|
$ —
|
— %
|
|
N/M - Not
meaningful
|
|
|
|
|
|
|
|
|
|
|
|
|
Flagstar Bancorp,
Inc.
Condensed Consolidated Statements of
Operations
(Dollars in millions, except per share data)
(Unaudited)
|
|
|
Six Months
Ended
|
|
Change
|
|
June 30,
2022
|
|
June 30,
2021
|
|
Amount
|
|
Percent
|
|
Interest
Income
|
|
|
|
|
|
|
|
|
Total interest
income
|
$
386
|
|
$
405
|
|
$
(19)
|
|
(5) %
|
|
Total interest
expense
|
28
|
|
34
|
|
(6)
|
|
(18) %
|
|
Net interest
income
|
358
|
|
371
|
|
(13)
|
|
(4) %
|
|
(Benefit) provision
for credit losses
|
(13)
|
|
(72)
|
|
59
|
|
N/M
|
|
Net interest
income after provision for credit losses
|
371
|
|
443
|
|
(72)
|
|
(16) %
|
|
Noninterest
Income
|
|
|
|
|
|
|
|
|
Net gain on loan
sales
|
72
|
|
395
|
|
(323)
|
|
(82) %
|
|
Loan fees and
charges
|
56
|
|
79
|
|
(23)
|
|
(29) %
|
|
Net return (loss) on
the mortgage servicing rights
|
51
|
|
(5)
|
|
56
|
|
(1,120) %
|
|
Loan administration
income
|
66
|
|
54
|
|
12
|
|
22 %
|
|
Deposit fees and
charges
|
18
|
|
17
|
|
1
|
|
6 %
|
|
Other noninterest
income
|
28
|
|
36
|
|
(8)
|
|
(22) %
|
|
Total
noninterest income
|
291
|
|
576
|
|
(285)
|
|
(49) %
|
|
Noninterest
Expense
|
|
|
|
|
|
|
|
|
Compensation and
benefits
|
249
|
|
266
|
|
(17)
|
|
(6) %
|
|
Occupancy and
equipment
|
91
|
|
95
|
|
(4)
|
|
(4) %
|
|
Commissions
|
48
|
|
112
|
|
(64)
|
|
(57) %
|
|
Loan processing
expense
|
44
|
|
43
|
|
1
|
|
2 %
|
|
Legal and professional
expense
|
21
|
|
20
|
|
1
|
|
5 %
|
|
Federal insurance
premiums
|
8
|
|
10
|
|
(2)
|
|
(20) %
|
|
Intangible asset
amortization
|
5
|
|
5
|
|
—
|
|
— %
|
|
Other noninterest
expense
|
51
|
|
85
|
|
(34)
|
|
(40) %
|
|
Total
noninterest expense
|
517
|
|
636
|
|
(119)
|
|
(19) %
|
|
Income before income
taxes
|
145
|
|
383
|
|
(238)
|
|
(62) %
|
|
Provision for income
taxes
|
32
|
|
87
|
|
(55)
|
|
(63) %
|
|
Net income
|
$
113
|
|
$
296
|
|
$
(183)
|
|
(62) %
|
|
Income per
share
|
|
|
|
|
|
|
|
|
Basic
|
$
2.12
|
|
$
5.61
|
|
$
(3.49)
|
|
(62) %
|
|
Diluted
|
$
2.11
|
|
$
5.54
|
|
$
(3.43)
|
|
(62) %
|
|
|
|
|
|
|
|
|
|
Cash dividends
declared
|
$
0.12
|
|
$
0.12
|
|
$
—
|
|
— %
|
|
N/M - Not
meaningful
|
|
|
|
|
|
|
|
|
Flagstar Bancorp,
Inc.
Summary of Selected Consolidated Financial and
Statistical Data
(Dollars in millions, except share
data)
(Unaudited)
|
|
|
Three Months
Ended
|
|
Six Months
Ended
|
|
June 30,
2022
|
|
March 31,
2022
|
|
June 30,
2021
|
|
June 30,
2022
|
|
June 30,
2021
|
|
Selected Mortgage
Statistics (1):
|
|
|
|
|
|
|
|
|
|
|
Mortgage rate lock
commitments (fallout-adjusted) (2)
|
$
7,100
|
|
$
7,700
|
|
$ 12,400
|
|
$ 14,800
|
|
$ 24,800
|
|
Mortgage loans
closed
|
$
7,700
|
|
$
8,200
|
|
$ 12,800
|
|
$ 15,900
|
|
$ 26,600
|
|
Mortgage loans sold
and securitized
|
$
6,900
|
|
$
9,900
|
|
$ 14,000
|
|
$ 16,800
|
|
$ 27,600
|
|
Selected
Ratios:
|
|
|
|
|
|
|
|
|
|
|
Interest rate spread
(3)
|
3.47 %
|
|
2.91 %
|
|
2.70 %
|
|
3.19 %
|
|
2.62 %
|
|
Net interest
margin
|
3.69 %
|
|
3.11 %
|
|
2.90 %
|
|
3.40 %
|
|
2.86 %
|
|
Net margin on loans
sold and securitized
|
0.39 %
|
|
0.45 %
|
|
1.20 %
|
|
0.43 %
|
|
1.42 %
|
|
Return on average
assets
|
1.01 %
|
|
0.87 %
|
|
2.09 %
|
|
0.94 %
|
|
2.04 %
|
|
Adjusted return on
average assets (4)
|
1.05 %
|
|
0.92 %
|
|
2.08 %
|
|
0.98 %
|
|
2.22 %
|
|
Return on average
common equity
|
8.74 %
|
|
7.87 %
|
|
23.97 %
|
|
8.31 %
|
|
24.82 %
|
|
Return on average
tangible common equity (5)
|
9.49 %
|
|
8.61 %
|
|
25.92 %
|
|
9.05 %
|
|
26.92 %
|
|
Adjusted return on
average tangible common equity (4) (5)
|
10.09 %
|
|
9.10 %
|
|
25.67 %
|
|
9.60 %
|
|
30.66 %
|
|
Efficiency
ratio
|
79.1 %
|
|
80.4 %
|
|
66.6 %
|
|
79.7 %
|
|
67.2 %
|
|
Adjusted efficiency
ratio (4)
|
78.1 %
|
|
79.6 %
|
|
66.8 %
|
|
78.9 %
|
|
63.6 %
|
|
Common
equity-to-assets ratio (average for the period)
|
11.54 %
|
|
11.12 %
|
|
8.74 %
|
|
11.33 %
|
|
8.21 %
|
|
Average
Balances:
|
|
|
|
|
|
|
|
|
|
|
Average
interest-earning assets
|
$ 20,958
|
|
$ 21,569
|
|
$ 25,269
|
|
$ 21,261
|
|
$ 26,218
|
|
Average
interest-bearing liabilities
|
$ 12,889
|
|
$ 12,959
|
|
$ 14,641
|
|
$ 12,923
|
|
$ 14,825
|
|
Average stockholders'
equity
|
$
2,754
|
|
$
2,687
|
|
$
2,448
|
|
$
2,721
|
|
$
2,384
|
|
(1)
|
Rounded to nearest
hundred million.
|
|
(2)
|
Fallout-adjusted
mortgage rate lock commitments are adjusted by a percentage of
mortgage loans in the pipeline that are not expected to close based
on previous historical experience and the level of interest
rates.
|
|
(3)
|
Interest rate spread is
the difference between rate of interest earned on interest-earning
assets and rate of interest paid on interest-bearing
liabilities.
|
|
(4)
|
See Non-GAAP
Reconciliation for further information.
|
|
(5)
|
Excludes goodwill,
intangible assets and the associated amortization. See Non-GAAP
Reconciliation for further information.
|
|
June 30,
2022
|
|
March 31,
2022
|
|
December 31,
2021
|
|
June 30,
2021
|
|
Selected
Statistics:
|
|
|
|
|
|
|
|
|
Book value per common
share
|
$
50.50
|
|
$
51.33
|
|
$
51.09
|
|
$
47.26
|
|
Tangible book value
per share (1)
|
$
47.83
|
|
$
48.61
|
|
$
48.33
|
|
$
44.38
|
|
Number of common
shares outstanding
|
53,329,993
|
|
53,236,067
|
|
53,197,650
|
|
52,862,264
|
|
Number of FTE
employees
|
5,036
|
|
5,341
|
|
5,395
|
|
5,503
|
|
Number of bank
branches
|
158
|
|
158
|
|
158
|
|
158
|
|
Ratio of nonperforming
assets to total assets (2)
|
0.42 %
|
|
0.48 %
|
|
0.39 %
|
|
0.30 %
|
|
Common
equity-to-assets ratio
|
10.82 %
|
|
11.75 %
|
|
10.67 %
|
|
9.23 %
|
|
MSR Key Statistics
and Ratios:
|
|
|
|
|
|
|
|
|
Weighted average
service fee (basis points)
|
31.7
|
|
31.2
|
|
31.5
|
|
32.6
|
|
Capitalized value of
mortgage servicing rights
|
1.50 %
|
|
1.31 %
|
|
1.12 %
|
|
1.00 %
|
|
(1)
|
Excludes goodwill and
intangibles. See Non-GAAP Reconciliation for further
information.
|
|
(2)
|
Ratio excludes
LHFS.
|
|
Average Balances,
Yields and Rates
(Dollars in millions)
(Unaudited)
|
|
|
Three Months
Ended
|
|
June 30,
2022
|
|
March 31,
2022
|
|
June 30,
2021
|
|
Average
Balance
|
Interest
|
Annualized
Yield/Rate
|
|
Average
Balance
|
Interest
|
Annualized
Yield/Rate
|
|
Average
Balance
|
Interest
|
Annualized
Yield/Rate
|
|
Interest-Earning
Assets
|
|
|
Loans
held-for-sale
|
$
3,571
|
$
36
|
4.10 %
|
|
$ 4,833
|
$
40
|
3.31 %
|
|
$ 6,902
|
$
53
|
3.05 %
|
|
Loans
held-for-investment
|
|
|
|
|
|
|
|
|
|
|
|
|
Residential
first mortgage
|
1,789
|
16
|
3.68 %
|
|
1,500
|
13
|
3.35 %
|
|
1,887
|
15
|
3.27 %
|
|
Home
equity
|
614
|
7
|
4.74 %
|
|
598
|
6
|
4.05 %
|
|
748
|
7
|
3.64 %
|
|
Other
|
1,302
|
16
|
4.80 %
|
|
1,253
|
15
|
4.86 %
|
|
1,101
|
13
|
4.80 %
|
|
Total consumer
loans
|
3,705
|
39
|
4.25 %
|
|
3,351
|
34
|
4.04 %
|
|
3,736
|
35
|
3.79 %
|
|
Commercial real
estate
|
3,366
|
41
|
4.78 %
|
|
3,226
|
29
|
3.60 %
|
|
3,093
|
26
|
3.37 %
|
|
Commercial and
industrial
|
2,169
|
26
|
4.65 %
|
|
1,834
|
16
|
3.52 %
|
|
1,449
|
14
|
3.72 %
|
|
Warehouse
lending
|
4,099
|
34
|
3.27 %
|
|
3,973
|
32
|
3.25 %
|
|
5,410
|
53
|
3.95 %
|
|
Total commercial
loans
|
9,634
|
101
|
4.11 %
|
|
9,033
|
77
|
3.43 %
|
|
9,952
|
93
|
3.74 %
|
|
Total loans
held-for-investment
|
13,339
|
140
|
4.15 %
|
|
12,384
|
111
|
3.59 %
|
|
13,688
|
128
|
3.75 %
|
|
Loans with government
guarantees
|
1,161
|
15
|
5.13 %
|
|
1,402
|
15
|
4.40 %
|
|
2,344
|
5
|
0.79 %
|
|
Investment
securities
|
2,310
|
17
|
2.89 %
|
|
2,021
|
11
|
2.19 %
|
|
2,123
|
12
|
2.19 %
|
|
Interest-earning
deposits
|
577
|
1
|
0.64 %
|
|
929
|
—
|
0.16 %
|
|
212
|
—
|
0.13 %
|
|
Total
interest-earning assets
|
20,958
|
$
209
|
3.96 %
|
|
21,569
|
$
177
|
3.30 %
|
|
25,269
|
$
198
|
3.12 %
|
|
Other
assets
|
2,909
|
|
|
|
2,592
|
|
|
|
2,742
|
|
|
|
Total
assets
|
$ 23,867
|
|
|
|
$
24,161
|
|
|
|
$
28,011
|
|
|
|
Interest-Bearing
Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
Retail
deposits
|
|
|
|
|
|
|
|
|
|
|
|
|
Demand
deposits
|
$
1,725
|
$
1
|
0.10 %
|
|
$ 1,626
|
$
—
|
0.09 %
|
|
$ 1,686
|
$
—
|
0.06 %
|
|
Savings
deposits
|
4,251
|
2
|
0.16 %
|
|
4,253
|
2
|
0.14 %
|
|
4,084
|
1
|
0.14 %
|
|
Money market
deposits
|
926
|
—
|
0.16 %
|
|
887
|
—
|
0.09 %
|
|
762
|
—
|
0.07 %
|
|
Certificates of
deposit
|
851
|
1
|
0.35 %
|
|
929
|
1
|
0.35 %
|
|
1,126
|
2
|
0.62 %
|
|
Total retail
deposits
|
7,753
|
4
|
0.17 %
|
|
7,695
|
3
|
0.15 %
|
|
7,658
|
3
|
0.18 %
|
|
Government
deposits
|
1,699
|
1
|
0.32 %
|
|
1,879
|
1
|
0.17 %
|
|
1,795
|
1
|
0.19 %
|
|
Wholesale deposits and
other
|
935
|
2
|
0.98 %
|
|
1,071
|
2
|
0.89 %
|
|
1,170
|
4
|
1.33 %
|
|
Total interest-bearing
deposits
|
10,387
|
7
|
0.26 %
|
|
10,645
|
6
|
0.23 %
|
|
10,623
|
8
|
0.31 %
|
|
Short-term FHLB
advances and other
|
1,124
|
3
|
1.05 %
|
|
658
|
—
|
0.22 %
|
|
2,422
|
1
|
0.17 %
|
|
Long-term FHLB
advances
|
982
|
3
|
1.15 %
|
|
1,260
|
3
|
0.98 %
|
|
1,200
|
3
|
1.03 %
|
|
Other long-term
debt
|
396
|
3
|
3.07 %
|
|
396
|
3
|
3.23 %
|
|
396
|
3
|
3.19 %
|
|
Total
interest-bearing liabilities
|
12,889
|
$
16
|
0.48 %
|
|
12,959
|
$
12
|
0.39 %
|
|
14,641
|
15
|
0.43 %
|
|
Noninterest-bearing
deposits
|
|
|
|
|
|
|
|
|
|
|
|
|
Retail deposits
and other
|
2,460
|
|
|
|
2,474
|
|
|
|
2,259
|
|
|
|
Custodial
deposits (1)
|
4,641
|
|
|
|
4,970
|
|
|
|
6,188
|
|
|
|
Total
noninterest-bearing deposits
|
7,101
|
|
|
|
7,444
|
|
|
|
8,447
|
|
|
|
Other
liabilities
|
1,123
|
|
|
|
1,071
|
|
|
|
2,476
|
|
|
|
Stockholders'
equity
|
2,754
|
|
|
|
2,687
|
|
|
|
2,448
|
|
|
|
Total liabilities and
stockholders' equity
|
$ 23,867
|
|
|
|
$
24,161
|
|
|
|
$
28,012
|
|
|
|
Net interest-earning
assets
|
$
8,069
|
|
|
|
$ 8,610
|
|
|
|
$
10,628
|
|
|
|
Net interest
income
|
|
$
193
|
|
|
|
$
165
|
|
|
|
$
183
|
|
|
Interest rate spread
(2)
|
|
|
3.47 %
|
|
|
|
2.91 %
|
|
|
|
2.70 %
|
|
Net interest margin
(3)
|
|
|
3.69 %
|
|
|
|
3.11 %
|
|
|
|
2.90 %
|
|
Ratio of average
interest-earning assets to interest-bearing liabilities
|
|
|
162.6 %
|
|
|
|
166.4 %
|
|
|
|
172.6 %
|
|
Total average
deposits
|
$ 17,488
|
|
|
|
$
18,089
|
|
|
|
$
19,070
|
|
|
|
(1)
|
Approximately 80
percent of custodial deposits from loans subserviced for which
LIBOR based fees are recognized as an offset in net loan
administration income.
|
|
(2)
|
Interest rate spread is
the difference between rate of interest earned on interest-earning
assets and rate of interest paid on interest-bearing
liabilities.
|
|
(3)
|
Net interest margin is
net interest income divided by average interest-earning
assets.
|
|
Average Balances,
Yields and Rates
(Dollars in millions)
(Unaudited)
|
|
|
Six Months
Ended
|
|
June 30,
2022
|
|
June 30,
2021
|
|
Average
Balance
|
Interest
|
Annualized
Yield/Rate
|
|
Average
Balance
|
Interest
|
Annualized
Yield/Rate
|
|
Interest-Earning
Assets
|
|
|
Loans
held-for-sale
|
$
4,199
|
$
77
|
3.65 %
|
|
$
7,181
|
$
105
|
2.94 %
|
|
Loans
held-for-investment
|
|
|
|
|
|
|
|
|
Residential
first mortgage
|
1,645
|
29
|
3.53 %
|
|
2,009
|
32
|
3.23 %
|
|
Home
equity
|
606
|
13
|
4.40 %
|
|
784
|
14
|
3.56 %
|
|
Other
|
1,278
|
30
|
4.83 %
|
|
1,071
|
25
|
4.80 %
|
|
Total consumer
loans
|
3,529
|
72
|
4.15 %
|
|
3,864
|
71
|
3.73 %
|
|
Commercial real
estate
|
3,296
|
70
|
4.21 %
|
|
3,068
|
52
|
3.36 %
|
|
Commercial and
industrial
|
2,002
|
42
|
4.14 %
|
|
1,467
|
27
|
3.62 %
|
|
Warehouse
lending
|
4,036
|
66
|
3.26 %
|
|
5,900
|
118
|
3.98 %
|
|
Total
commercial loans
|
9,334
|
178
|
3.78 %
|
|
10,435
|
197
|
3.75 %
|
|
Total loans
held-for-investment
|
12,863
|
250
|
3.88 %
|
|
14,299
|
268
|
3.74 %
|
|
Loans with government
guarantees
|
1,281
|
30
|
4.73 %
|
|
2,422
|
8
|
0.67 %
|
|
Investment
securities
|
2,166
|
28
|
2.56 %
|
|
2,166
|
24
|
2.20 %
|
|
Interest-earning
deposits
|
752
|
1
|
0.35 %
|
|
150
|
—
|
0.14 %
|
|
Total
interest-earning assets
|
21,261
|
$
386
|
3.63 %
|
|
26,218
|
$
405
|
3.09 %
|
|
Other
assets
|
2,752
|
|
|
|
2,814
|
|
|
|
Total
assets
|
$
24,013
|
|
|
|
$
29,032
|
|
|
|
Interest-Bearing
Liabilities
|
|
|
|
|
|
|
|
|
Retail
deposits
|
|
|
|
|
|
|
|
|
Demand
deposits
|
$
1,676
|
$
1
|
0.10 %
|
|
$
1,768
|
$
—
|
0.07 %
|
|
Savings
deposits
|
4,252
|
3
|
0.15 %
|
|
4,015
|
3
|
0.14 %
|
|
Money market
deposits
|
907
|
1
|
0.12 %
|
|
724
|
—
|
0.06 %
|
|
Certificates of
deposit
|
890
|
1
|
0.35 %
|
|
1,209
|
5
|
0.80 %
|
|
Total retail
deposits
|
7,725
|
6
|
0.16 %
|
|
7,716
|
8
|
0.22 %
|
|
Government
deposits
|
1,788
|
2
|
0.24 %
|
|
1,784
|
2
|
0.21 %
|
|
Wholesale deposits and
other
|
1,002
|
5
|
0.93 %
|
|
1,101
|
8
|
1.47 %
|
|
Total
interest-bearing deposits
|
10,515
|
13
|
0.25 %
|
|
10,601
|
18
|
0.35 %
|
|
Short-term FHLB
advances and other
|
892
|
3
|
0.74 %
|
|
2,600
|
2
|
0.17 %
|
|
Long-term FHLB
advances
|
1,120
|
6
|
1.05 %
|
|
1,200
|
6
|
1.03 %
|
|
Other long-term
debt
|
396
|
6
|
3.13 %
|
|
424
|
8
|
3.68 %
|
|
Total
interest-bearing liabilities
|
12,923
|
$
28
|
0.44 %
|
|
14,825
|
$
34
|
0.47 %
|
|
Noninterest-bearing
deposits
|
|
|
|
|
|
|
|
|
Retail deposits
and other
|
2,467
|
|
|
|
2,264
|
|
|
|
Custodial
deposits (1)
|
4,805
|
|
|
|
6,688
|
|
|
|
Total
noninterest-bearing deposits
|
7,272
|
|
|
|
8,952
|
|
|
|
Other
liabilities
|
1,098
|
|
|
|
2,871
|
|
|
|
Stockholders'
equity
|
2,721
|
|
|
|
2,384
|
|
|
|
Total liabilities and
stockholders' equity
|
$
24,014
|
|
|
|
$
29,032
|
|
|
|
Net interest-earning
assets
|
$
8,338
|
|
|
|
$
11,393
|
|
|
|
Net interest
income
|
|
$
358
|
|
|
|
$
371
|
|
|
Interest rate spread
(2)
|
|
|
3.19 %
|
|
|
|
2.62 %
|
|
Net interest margin
(3)
|
|
|
3.40 %
|
|
|
|
2.86 %
|
|
Ratio of average
interest-earning assets to interest-bearing liabilities
|
|
|
164.5 %
|
|
|
|
176.9 %
|
|
Total average
deposits
|
$
17,787
|
|
|
|
$
19,554
|
|
|
|
(1)
|
Approximately 80
percent of custodial deposits from loans subserviced for which
LIBOR based fees are recognized as an offset in net loan
administration income.
|
|
(2)
|
Interest rate spread is
the difference between rate of interest earned on interest-earning
assets and rate of interest paid on interest-bearing
liabilities.
|
|
(3)
|
Net interest margin is
net interest income divided by average interest-earning
assets.
|
|
Earnings Per
Share
(Dollars in millions, except share data)
(Unaudited)
|
|
|
Three Months
Ended
|
|
Six Months
Ended
|
|
June 30,
2022
|
|
March 31,
2022
|
|
June 30,
2021
|
|
June 30,
2022
|
|
June 30,
2021
|
|
Net income
|
$
60
|
|
$
53
|
|
$
147
|
|
$
113
|
|
$
296
|
|
Weighted average
common shares outstanding
|
53,269,631
|
|
53,219,866
|
|
52,763,868
|
|
53,244,886
|
|
52,719,959
|
|
Stock-based
awards
|
265,817
|
|
358,135
|
|
772,801
|
|
311,721
|
|
697,937
|
|
Weighted
average diluted common shares
|
53,535,448
|
|
53,578,001
|
|
53,536,669
|
|
53,556,607
|
|
53,417,896
|
|
Basic earnings per
common share
|
$
1.13
|
|
$
0.99
|
|
$
2.78
|
|
$
2.12
|
|
$
5.61
|
|
Stock-based
awards
|
(0.01)
|
|
—
|
|
(0.04)
|
|
(0.01)
|
|
(0.07)
|
|
Diluted
earnings per common share
|
$
1.12
|
|
$
0.99
|
|
$
2.74
|
|
$
2.11
|
|
$
5.54
|
|
Regulatory Capital -
Bancorp
(Dollars in millions)
(Unaudited)
|
|
|
June 30,
2022
|
|
March 31,
2022
|
|
December 31,
2021
|
|
June 30,
2021
|
|
Amount
|
Ratio
|
|
Amount
|
Ratio
|
|
Amount
|
Ratio
|
|
Amount
|
Ratio
|
|
Tier 1 leverage (to
adjusted avg. total assets)
|
$ 2,900
|
12.17 %
|
|
$ 2,843
|
11.83 %
|
|
$ 2,798
|
10.54 %
|
|
$ 2,562
|
9.21 %
|
|
Total adjusted avg.
total asset base
|
$
23,835
|
|
|
$
24,026
|
|
|
$
26,545
|
|
|
$
27,828
|
|
|
Tier 1 common equity
(to risk weighted assets)
|
$ 2,660
|
13.22 %
|
|
$ 2,603
|
13.89 %
|
|
$ 2,558
|
13.19 %
|
|
$ 2,322
|
11.38 %
|
|
Tier 1 capital (to
risk weighted assets)
|
$ 2,900
|
14.41 %
|
|
$ 2,843
|
15.17 %
|
|
$ 2,798
|
14.43 %
|
|
$ 2,562
|
12.56 %
|
|
Total capital (to risk
weighted assets)
|
$ 3,155
|
15.68 %
|
|
$ 3,110
|
16.59 %
|
|
$ 3,080
|
15.88 %
|
|
$ 2,882
|
14.13 %
|
|
Risk-weighted asset
base
|
$
20,130
|
|
|
$
18,741
|
|
|
$
19,397
|
|
|
$
20,399
|
|
|
Regulatory Capital -
Bank
(Dollars in millions)
(Unaudited)
|
|
|
June 30,
2022
|
|
March 31,
2022
|
|
December 31,
2021
|
|
June 30,
2021
|
|
Amount
|
Ratio
|
|
Amount
|
Ratio
|
|
Amount
|
Ratio
|
|
Amount
|
Ratio
|
|
Tier 1 leverage (to
adjusted avg. total assets)
|
$ 2,824
|
11.87 %
|
|
$ 2,758
|
11.50 %
|
|
$ 2,706
|
10.21 %
|
|
$ 2,464
|
8.88 %
|
|
Total adjusted avg.
total asset base
|
$
23,786
|
|
|
$
23,984
|
|
|
$
26,502
|
|
|
$
27,767
|
|
|
Tier 1 common equity
(to risk weighted assets)
|
$ 2,824
|
14.04 %
|
|
$ 2,758
|
14.73 %
|
|
$ 2,706
|
13.96 %
|
|
$ 2,464
|
12.08 %
|
|
Tier 1 capital (to
risk weighted assets)
|
$ 2,824
|
14.04 %
|
|
$ 2,758
|
14.73 %
|
|
$ 2,706
|
13.96 %
|
|
$ 2,464
|
12.08 %
|
|
Total capital (to risk
weighted assets)
|
$ 2,931
|
14.57 %
|
|
$ 2,875
|
15.35 %
|
|
$ 2,839
|
14.65 %
|
|
$ 2,634
|
12.92 %
|
|
Risk-weighted asset
base
|
$
20,113
|
|
|
$
18,725
|
|
|
$
19,383
|
|
|
$
20,395
|
|
|
Loans
Serviced
(Dollars in millions)
(Unaudited)
|
|
|
June 30,
2022
|
|
March 31,
2022
|
|
December 31,
2021
|
|
June 30,
2021
|
|
Unpaid
Principal
Balance (1)
|
Number of
accounts
|
|
Unpaid
Principal
Balance (1)
|
Number of
accounts
|
|
Unpaid
Principal
Balance (1)
|
Number of
accounts
|
|
Unpaid
Principal
Balance (1)
|
Number of
accounts
|
|
Subserviced for others
(2)
|
$
293,808
|
1,160,087
|
|
$
253,013
|
1,041,251
|
|
$
246,858
|
1,032,923
|
|
$
211,775
|
975,467
|
|
Serviced for others
(3)
|
41,557
|
160,387
|
|
40,065
|
154,404
|
|
35,074
|
137,243
|
|
34,263
|
139,029
|
|
Serviced for own loan
portfolio (4)
|
7,959
|
62,217
|
|
7,215
|
60,167
|
|
8,793
|
63,426
|
|
9,685
|
67,988
|
|
Total loans
serviced
|
$
343,324
|
1,382,691
|
|
$
300,293
|
1,255,822
|
|
$
290,725
|
1,233,592
|
|
$
255,723
|
1,182,484
|
|
(1)
|
UPB, net of write
downs, does not include premiums or discounts.
|
|
(2)
|
Loans subserviced for a
fee for non-Flagstar owned loans or MSRs. Includes temporary
short-term subservicing performed as a result of sales of
servicing-released MSRs.
|
|
(3)
|
Loans for which
Flagstar owns the MSR.
|
|
(4)
|
Includes LHFI
(residential first mortgage, home equity and other consumer), LHFS
(residential first mortgage), loans with government guarantees
(residential first mortgage), and repossessed assets.
|
|
Loans
Held-for-Investment
(Dollars in millions)
(Unaudited)
|
|
|
June 30,
2022
|
|
March 31,
2022
|
|
December 31,
2021
|
|
June 30,
2021
|
|
Consumer
loans
|
|
|
|
|
|
|
|
|
|
|
|
|
Residential first
mortgage
|
$ 2,205
|
15.0 %
|
|
$ 1,499
|
11.3 %
|
|
$ 1,536
|
11.5 %
|
|
$ 1,794
|
12.8 %
|
|
Home equity
|
645
|
4.4 %
|
|
596
|
4.5 %
|
|
613
|
4.6 %
|
|
717
|
5.1 %
|
|
Other
|
1,331
|
9.1 %
|
|
1,267
|
9.6 %
|
|
1,236
|
9.2 %
|
|
1,133
|
8.0 %
|
|
Total consumer
loans
|
4,181
|
28.5 %
|
|
3,362
|
25.4 %
|
|
3,385
|
25.3 %
|
|
3,644
|
25.9 %
|
|
Commercial
loans
|
|
|
|
|
|
|
|
|
|
|
|
|
Commercial real
estate
|
3,387
|
23.1 %
|
|
3,254
|
24.5 %
|
|
3,223
|
24.0 %
|
|
3,169
|
22.6 %
|
|
Commercial and
industrial
|
2,653
|
18.1 %
|
|
1,979
|
15.0 %
|
|
1,826
|
13.6 %
|
|
1,376
|
9.8 %
|
|
Warehouse
lending
|
4,434
|
30.3 %
|
|
4,641
|
35.1 %
|
|
4,974
|
37.1 %
|
|
5,863
|
41.7 %
|
|
Total
commercial loans
|
10,474
|
71.5 %
|
|
9,874
|
74.6 %
|
|
10,023
|
74.7 %
|
|
10,408
|
74.1 %
|
|
Total loans
held-for-investment
|
$
14,655
|
100.0 %
|
|
$
13,236
|
100.0 %
|
|
$
13,408
|
100.0 %
|
|
$
14,052
|
100.0 %
|
|
Other Consumer Loans
Held-for-Investment
(Dollars in millions)
(Unaudited)
|
|
|
June 30,
2022
|
|
March 31,
2022
|
|
December 31,
2021
|
|
June 30,
2021
|
|
Indirect
lending
|
$
972
|
73.0 %
|
|
$
935
|
73.8 %
|
|
$
926
|
74.8 %
|
|
$
866
|
76.4 %
|
|
Point of
sale
|
300
|
22.5 %
|
|
295
|
23.3 %
|
|
272
|
22.0 %
|
|
225
|
19.9 %
|
|
Other
|
59
|
4.4 %
|
|
37
|
2.9 %
|
|
38
|
3.2 %
|
|
42
|
3.7 %
|
|
Total other consumer
loans
|
$ 1,331
|
100.0 %
|
|
$ 1,267
|
100.0 %
|
|
$ 1,236
|
100.0 %
|
|
$ 1,133
|
100.0 %
|
|
Allowance for Credit
Losses
(Dollars in millions)
(Unaudited)
|
|
|
June 30,
2022
|
|
March 31,
2022
|
|
June 30,
2021
|
|
Residential first
mortgage
|
$
33
|
|
$
43
|
|
$
48
|
|
Home equity
|
21
|
|
16
|
|
17
|
|
Other
|
31
|
|
34
|
|
38
|
|
Total consumer
loans
|
85
|
|
93
|
|
103
|
|
Commercial real
estate
|
22
|
|
22
|
|
58
|
|
Commercial and
industrial
|
11
|
|
13
|
|
38
|
|
Warehouse
lending
|
4
|
|
3
|
|
3
|
|
Total commercial
loans
|
37
|
|
38
|
|
99
|
|
Allowance for
loan losses
|
122
|
|
131
|
|
202
|
|
Reserve for
unfunded commitments
|
13
|
|
14
|
|
18
|
|
Allowance for credit
losses
|
$
135
|
|
$
145
|
|
$
220
|
|
Allowance for Credit
Losses
(Dollars in millions)
(Unaudited)
|
|
|
Three Months Ended
June 30, 2022
|
|
Residential
First
Mortgage
|
Home
Equity
|
Other
Consumer
|
Commercial
Real Estate
|
Commercial
and
Industrial
|
Warehouse
Lending
|
Total LHFI
Portfolio (1)
|
Unfunded
Commitments
|
|
Beginning
balance
|
$
43
|
$
16
|
$
34
|
$
22
|
$
13
|
$
3
|
$
131
|
$
14
|
|
Provision (benefit)
for credit losses:
|
|
|
|
|
|
|
|
|
|
Loan
volume
|
4
|
1
|
2
|
1
|
4
|
—
|
12
|
(1)
|
|
Economic
forecast (2)
|
2
|
1
|
(4)
|
—
|
(1)
|
—
|
(2)
|
—
|
|
Credit
(3)
|
(16)
|
3
|
(1)
|
(1)
|
(5)
|
1
|
(19)
|
—
|
|
Qualitative
factor adjustments
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
|
Charge-offs
|
—
|
—
|
(3)
|
—
|
—
|
—
|
(3)
|
—
|
|
Recoveries
|
—
|
—
|
2
|
—
|
—
|
—
|
2
|
—
|
|
Provision for net
charge-offs
|
—
|
—
|
1
|
—
|
—
|
—
|
1
|
—
|
|
Ending allowance
balance
|
$
33
|
$
21
|
$
31
|
$
22
|
$
11
|
$
4
|
$
122
|
$
13
|
|
(1)
|
Excludes loans carried
under the fair value option.
|
|
(2)
|
Includes changes in the
lifetime loss rate based on current economic forecasts as compared
to forecasts used in the prior quarter.
|
|
(3)
|
Includes changes in the
probability of default and severity of default based on current
borrower and guarantor characteristics, as well as individually
evaluated reserves.
|
|
Allowance for Credit
Losses
(Dollars in millions)
(Unaudited)
|
|
|
Six Months Ended
June 30, 2022
|
|
Residential
First
Mortgage
|
Home
Equity
|
Other
Consumer
|
Commercial
Real Estate
|
Commercial
and
Industrial
|
Warehouse
Lending
|
Total LHFI
Portfolio (1)
|
Unfunded
Commitments
|
|
Beginning
balance
|
$
40
|
$
14
|
$
36
|
$
28
|
$
32
|
$
4
|
$
154
|
$
16
|
|
Provision (benefit)
for credit losses:
|
|
|
|
|
|
|
|
|
|
Loan
volume
|
4
|
1
|
3
|
1
|
7
|
—
|
16
|
(3)
|
|
Economic
forecast (2)
|
3
|
3
|
(4)
|
1
|
(3)
|
—
|
—
|
—
|
|
Credit
(3)
|
(14)
|
3
|
(4)
|
(7)
|
(3)
|
—
|
(25)
|
—
|
|
Qualitative
factor adjustments
|
—
|
—
|
—
|
(1)
|
(4)
|
—
|
(5)
|
—
|
|
Charge-offs
|
(1)
|
—
|
(5)
|
—
|
(20)
|
—
|
(26)
|
—
|
|
Recoveries
|
—
|
1
|
3
|
—
|
—
|
—
|
4
|
—
|
|
Provision for net
charge-offs
|
1
|
(1)
|
2
|
—
|
2
|
—
|
4
|
—
|
|
Ending allowance
balance
|
$
33
|
$
21
|
$
31
|
$
22
|
$
11
|
$
4
|
$
122
|
$
13
|
|
(1)
|
Excludes loans carried
under the fair value option.
|
|
(2)
|
Includes changes in the
lifetime loss rate based on current economic forecasts as compared
to forecasts used in the prior quarter.
|
|
(3)
|
Includes changes in the
probability of default and severity of default based on current
borrower and guarantor characteristics, as well as individually
evaluated reserves.
|
|
Nonperforming Loans
and Assets
(Dollars in millions)
(Unaudited)
|
|
|
June 30,
2022
|
|
March 31,
2022
|
|
December 31,
2021
|
|
June 30,
2021
|
|
Nonperforming
LHFI
|
$
79
|
|
$
95
|
|
$
81
|
|
$
63
|
|
Nonperforming
TDRs
|
6
|
|
7
|
|
8
|
|
6
|
|
Nonperforming TDRs at
inception but performing for less than six months
|
14
|
|
5
|
|
5
|
|
7
|
|
Total nonperforming
LHFI and TDRs (1)
|
99
|
|
107
|
|
94
|
|
76
|
|
Other nonperforming
assets, net
|
5
|
|
4
|
|
6
|
|
6
|
|
LHFS
|
20
|
|
24
|
|
17
|
|
9
|
|
Total nonperforming
assets
|
$
124
|
|
$
135
|
|
$
117
|
|
$
91
|
|
|
|
|
|
|
|
|
|
Ratio of nonperforming
assets to total assets (2)
|
0.42 %
|
|
0.48 %
|
|
0.39 %
|
|
0.30 %
|
|
Ratio of nonperforming
LHFI and TDRs to LHFI
|
0.68 %
|
|
0.80 %
|
|
0.70 %
|
|
0.53 %
|
|
Ratio of nonperforming
assets to LHFI and repossessed assets (2)
|
0.71 %
|
|
0.84 %
|
|
0.74 %
|
|
0.57 %
|
|
(1)
|
Includes $35 million of
first residential mortgage loans that are current in accordance
with their forbearance exit plan and not yet returned to accrual
status as of June 30, 2022.
|
|
(2)
|
Ratio excludes
nonperforming LHFS.
|
|
Asset Quality -
Loans Held-for-Investment
(Dollars in millions)
(Unaudited)
|
|
|
30-59 Days
Past Due
|
|
60-89 Days
Past Due
|
|
Greater than
90 days
|
|
Total Past
Due
|
|
Total
LHFI
|
|
June 30,
2022
|
|
|
|
|
|
|
|
|
|
|
Consumer
loans
|
$
15
|
|
$
7
|
|
$
99
|
|
$
121
|
|
$
4,181
|
|
Commercial
loans
|
—
|
|
—
|
|
—
|
|
—
|
|
10,474
|
|
Total
loans
|
$
15
|
|
$
7
|
|
$
99
|
|
$
121
|
|
$
14,655
|
|
March 31,
2022
|
|
|
|
|
|
|
|
|
|
|
Consumer loans
(1)
|
$
12
|
|
$
10
|
|
$
98
|
|
$
120
|
|
$
3,362
|
|
Commercial
loans
|
—
|
|
—
|
|
—
|
|
—
|
|
9,874
|
|
Total loans
|
$
12
|
|
$
10
|
|
$
98
|
|
$
120
|
|
$
13,236
|
|
December 31,
2021
|
|
|
|
|
|
|
|
|
|
|
Consumer
loans
|
$
26
|
|
$
36
|
|
$
62
|
|
$
124
|
|
$
3,385
|
|
Commercial
loans
|
—
|
|
—
|
|
32
|
|
32
|
|
10,023
|
|
Total
loans
|
$
26
|
|
$
36
|
|
$
94
|
|
$
156
|
|
$
13,408
|
|
June 30,
2021
|
|
|
|
|
|
|
|
|
|
|
Consumer
loans
|
$
8
|
|
$
4
|
|
$
55
|
|
$
67
|
|
$
3,644
|
|
Commercial
loans
|
—
|
|
—
|
|
20
|
|
20
|
|
10,408
|
|
Total loans
|
$
8
|
|
$
4
|
|
$
75
|
|
$
87
|
|
$
14,052
|
|
(1)
|
Includes $33 million of
first residential mortgage loans that are current in accordance
with their forbearance exit plan and not yet returned to accrual
status as of June 30, 2022.
|
|
Troubled Debt
Restructurings
(Dollars in millions)
(Unaudited)
|
|
|
TDRs
|
|
Performing
|
|
Nonperforming
|
|
Total
|
|
June 30,
2022
|
|
|
Consumer
loans
|
$
22
|
|
$
20
|
|
$
42
|
|
Commercial
loans
|
—
|
|
—
|
|
—
|
|
Total TDR
loans
|
$
22
|
|
$
20
|
|
$
42
|
|
March 31,
2022
|
|
|
|
|
|
|
Consumer
loans
|
$
23
|
|
$
12
|
|
$
35
|
|
Commercial
loans
|
—
|
|
—
|
|
—
|
|
Total TDR
loans
|
$
23
|
|
$
12
|
|
$
35
|
|
December 31,
2021
|
|
|
|
|
|
|
Consumer
loans
|
$
22
|
|
$
13
|
|
$
35
|
|
Commercial
loans
|
2
|
|
—
|
|
2
|
|
Total TDR
loans
|
$
24
|
|
$
13
|
|
$
37
|
|
June 30,
2021
|
|
|
|
|
|
|
Consumer
loans
|
$
31
|
|
$
11
|
|
$
42
|
|
Commercial
loans
|
—
|
|
2
|
|
2
|
|
Total TDR
loans
|
$
31
|
|
$
13
|
|
$
44
|
|
Non-GAAP
Reconciliation
(Unaudited)
|
|
|
In addition to
analyzing the Company's results on a reported basis, management
reviews the Company's results and the
results on an adjusted basis. The non-GAAP measures presented in
the tables below reflect the adjustments of the reported
U.S.GAAP results for significant items that management does not
believe are reflective of the Company's current and ongoing
operations. The DOJ settlement expense and loans with government
guarantees that have not been repurchased and don't accrue
interest are not reflective of our ongoing operations and,
therefore, have been excluded from our U.S. GAAP results. The
Company believes that tangible book value per share, tangible
common equity to assets ratio, return on average tangible
common equity, adjusted return on average tangible common equity,
adjusted return on average assets, adjusted HFI loan-to-
deposit ratio, adjusted noninterest expense, adjusted income before
income taxes, adjusted provision for income taxes, adjusted
net income, adjusted basic earnings per share, adjusted diluted
earnings per share, adjusted net interest margin and adjusted
efficiency ratio provide a meaningful representation of its
operating performance on an ongoing basis.
|
|
|
The following tables provide a
reconciliation of non-GAAP financial measures.
|
|
|
Tangible book value
per share and tangible common equity to assets
ratio.
|
|
|
June 30,
2022
|
|
March 31,
2022
|
|
December 31,
2021
|
|
September 30,
2021
|
|
June 30,
2021
|
|
(Dollars in millions,
except share data)
|
|
Total stockholders'
equity
|
$
2,693
|
|
$
2,733
|
|
$
2,718
|
|
$
2,645
|
|
$
2,498
|
|
Less: Goodwill and
intangible assets
|
142
|
|
145
|
|
147
|
|
149
|
|
152
|
|
Tangible book
value
|
$
2,551
|
|
$
2,588
|
|
$
2,571
|
|
$
2,496
|
|
$
2,346
|
|
|
|
|
|
|
|
|
|
|
|
Number of common shares
outstanding
|
53,329,993
|
|
53,236,067
|
|
53,197,650
|
|
52,862,383
|
|
52,862,264
|
|
Tangible book value
per share
|
$
47.83
|
|
$
48.61
|
|
$
48.33
|
|
$
47.21
|
|
$
44.38
|
|
|
|
|
|
|
|
|
|
|
|
Total assets
|
$
24,899
|
|
$
23,244
|
|
$
25,483
|
|
$
27,042
|
|
$
27,065
|
|
Tangible common
equity to assets ratio
|
10.25 %
|
|
11.13 %
|
|
10.09 %
|
|
9.23 %
|
|
8.67 %
|
|
Return on average
tangible common equity, adjusted return on average tangible common
equity and adjusted return on average assets.
|
|
|
Three Months
Ended
|
|
Six Months
Ended
|
|
June 30,
2022
|
|
March 31,
2022
|
|
June 30,
2021
|
|
June 30,
2022
|
|
June 30,
2021
|
|
(Dollars in
millions)
|
|
|
|
|
|
Net income
|
$
60
|
|
$
53
|
|
$
147
|
|
$
113
|
|
$
296
|
|
Add: Intangible asset
amortization, net of tax
|
3
|
|
1
|
|
2
|
|
4
|
|
4
|
|
Tangible net
income
|
$
63
|
|
$
54
|
|
$
149
|
|
$
117
|
|
$
300
|
|
|
|
|
|
|
|
|
|
|
|
Total average
equity
|
$
2,754
|
|
$
2,687
|
|
$
2,448
|
|
$
2,721
|
|
$
2,384
|
|
Less: Average goodwill
and intangible assets
|
144
|
|
146
|
|
153
|
|
145
|
|
155
|
|
Total tangible average
equity
|
$
2,610
|
|
$
2,541
|
|
$
2,295
|
|
$
2,576
|
|
$
2,229
|
|
|
|
|
|
|
|
|
|
|
|
Return on average
tangible common equity
|
9.49 %
|
|
8.61 %
|
|
25.92 %
|
|
9.05 %
|
|
26.92 %
|
|
Adjustment to remove
DOJ settlement expense
|
— %
|
|
— %
|
|
— %
|
|
— %
|
|
3.86 %
|
|
Adjustment for former
CEO SERP agreement
|
— %
|
|
— %
|
|
(2.14) %
|
|
— %
|
|
(1.09) %
|
|
Adjustment for merger
costs
|
0.60 %
|
|
0.49 %
|
|
1.89 %
|
|
0.55 %
|
|
0.97 %
|
|
Adjusted return on
average tangible common equity
|
10.09 %
|
|
9.10 %
|
|
25.67 %
|
|
9.60 %
|
|
30.66 %
|
|
|
|
|
|
|
|
|
|
|
|
Return on average
assets
|
1.01 %
|
|
0.89 %
|
|
2.09 %
|
|
0.94 %
|
|
2.04 %
|
|
Adjustment to remove
DOJ settlement expense
|
— %
|
|
— %
|
|
— %
|
|
— %
|
|
0.18 %
|
|
Adjustment for former
CEO SERP settlement agreement
|
— %
|
|
— %
|
|
(0.11) %
|
|
— %
|
|
(0.05) %
|
|
Adjustment for merger
costs
|
0.04 %
|
|
0.03 %
|
|
0.10 %
|
|
0.04 %
|
|
0.05 %
|
|
Adjusted return on
average assets
|
1.05 %
|
|
0.92 %
|
|
2.08 %
|
|
0.98 %
|
|
2.22 %
|
|
Adjusted HFI
loan-to-deposit ratio.
|
|
|
June 30,
2022
|
|
March 31,
2022
|
|
December 31,
2021
|
|
September 30,
2021
|
|
June 30,
2021
|
|
(Dollars in
millions)
|
|
Average LHFI
|
$
13,339
|
|
$
12,384
|
|
$
13,314
|
|
$
13,540
|
|
$
13,688
|
|
Less: Average warehouse
loans
|
4,099
|
|
3,973
|
|
5,148
|
|
5,392
|
|
5,410
|
|
Adjusted average
LHFI
|
$
9,240
|
|
$
8,411
|
|
$
8,166
|
|
$
8,148
|
|
$
8,278
|
|
|
|
|
|
|
|
|
|
|
|
Average
deposits
|
$
17,488
|
|
$
18,089
|
|
$
19,816
|
|
$
19,686
|
|
$
19,070
|
|
Less: Average custodial
deposits
|
4,641
|
|
4,970
|
|
6,309
|
|
6,180
|
|
6,188
|
|
Adjusted average
deposits
|
$
12,847
|
|
$
13,119
|
|
$
13,507
|
|
$
13,506
|
|
$
12,882
|
|
|
|
|
|
|
|
|
|
|
|
HFI loan-to-deposit
ratio
|
76.3 %
|
|
68.5 %
|
|
67.2 %
|
|
68.8 %
|
|
71.8 %
|
|
Adjusted HFI
loan-to-deposit ratio
|
71.9 %
|
|
64.1 %
|
|
60.5 %
|
|
60.3 %
|
|
64.3 %
|
|
Adjusted noninterest
expense, income before income taxes, provision for income taxes,
net income, basic earnings per share, diluted earnings per share,
and efficiency ratio.
|
|
|
Three Months
Ended
|
|
June 30,
2022
|
|
March 31,
2022
|
|
December 31,
2021
|
|
September 30,
2021
|
|
June 30,
2021
|
|
(Dollar in
millions)
|
|
Noninterest
expense
|
$
256
|
|
$
261
|
|
$
291
|
|
$
286
|
|
$
289
|
|
Adjustment for former
CEO SERP agreement
|
—
|
|
—
|
|
—
|
|
—
|
|
(10)
|
|
Adjustment for merger
costs
|
3
|
|
3
|
|
6
|
|
5
|
|
9
|
|
Adjusted noninterest
expense
|
$
253
|
|
$
258
|
|
$
285
|
|
$
281
|
|
$
290
|
|
|
|
|
|
|
|
|
|
|
|
Income before income
taxes
|
$
77
|
|
$
68
|
|
$
109
|
|
$
198
|
|
$
190
|
|
Adjustment for former
CEO SERP agreement
|
—
|
|
—
|
|
—
|
|
—
|
|
(10)
|
|
Adjustment for merger
costs
|
3
|
|
3
|
|
6
|
|
5
|
|
9
|
|
Adjusted income
before income taxes
|
$
80
|
|
$
71
|
|
$
115
|
|
$
203
|
|
$
189
|
|
|
|
|
|
|
|
|
|
|
|
Provision for income
taxes
|
$
17
|
|
$
15
|
|
$
24
|
|
$
46
|
|
$
43
|
|
Adjustment for former
CEO SERP agreement
|
—
|
|
—
|
|
—
|
|
—
|
|
2
|
|
Adjustment for merger
costs
|
—
|
|
(1)
|
|
(1)
|
|
(1)
|
|
(2)
|
|
Adjusted provision
for income taxes
|
$
17
|
|
$
16
|
|
$
25
|
|
$
47
|
|
$
43
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
$
60
|
|
$
53
|
|
$
85
|
|
$
152
|
|
$
147
|
|
Adjusted net
income
|
$
63
|
|
$
55
|
|
$
90
|
|
$
156
|
|
$
146
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average common
shares outstanding
|
53,269,631
|
|
53,219,866
|
|
52,867,138
|
|
52,862,288
|
|
52,763,868
|
|
Weighted average
diluted common shares
|
53,535,448
|
|
53,578,001
|
|
53,577,832
|
|
53,659,422
|
|
53,536,669
|
|
Adjusted basic
earnings per share
|
$
1.18
|
|
$
1.03
|
|
$
1.71
|
|
$
2.94
|
|
$
2.78
|
|
Adjusted diluted
earnings per share
|
$
1.17
|
|
$
1.02
|
|
$
1.69
|
|
$
2.90
|
|
$
2.74
|
|
|
|
|
|
|
|
|
|
|
|
Efficiency
ratio
|
79.1 %
|
|
80.4 %
|
|
75.9 %
|
|
62.2 %
|
|
66.6 %
|
|
Adjustment for former
CEO SERP agreement
|
— %
|
|
— %
|
|
— %
|
|
— %
|
|
1.6 %
|
|
Adjustment for merger
costs
|
(1.0) %
|
|
(0.8) %
|
|
(1.5) %
|
|
(1.1) %
|
|
(1.4) %
|
|
Adjusted efficiency
ratio
|
78.1 %
|
|
79.6 %
|
|
74.4 %
|
|
61.1 %
|
|
66.8 %
|
|
|
Six Months
Ended
|
|
|
|
|
|
|
|
June 30,
2022
|
|
June 30,
2021
|
|
|
|
|
|
|
Efficiency
ratio
|
|
79.7 %
|
|
67.2 %
|
|
|
|
|
|
|
Adjustment to remove
DOJ settlement expense
|
|
— %
|
|
(2.6) %
|
|
|
|
|
|
|
Adjustment for former
CEO SERP agreement
|
|
— %
|
|
1.1 %
|
|
|
|
|
|
|
Adjustment for merger
costs
|
|
(0.9) %
|
|
(0.9) %
|
|
|
|
|
|
|
Adjusted efficiency
ratio
|
|
78.8 %
|
|
64.8 %
|
|
|
|
|
|
For more information,
contact:
Bryan Marx
FBCInvestorRelations@flagstar.com
(248) 312-5699
View original
content:https://www.prnewswire.com/news-releases/flagstar-bancorp-reports-second-quarter-2022-net-income-of-60-million-or-1-12-per-diluted-share-301593929.html
SOURCE Flagstar Bancorp, Inc.
