MOUNT LAUREL, N.J.,
Oct. 26, 2017 /PRNewswire/ --
Third Quarter Highlights:
- Third quarter 2017 net income of $2.7
million, or $0.14 per diluted
share, compared to net income of $1.5
million, or $0.08 per diluted
share, in second quarter of 2017.
- Return on average assets expands to 0.50% from 0.27% in linked
prior quarter; Efficiency ratio improves to 77% from 91% in linked
prior quarter.
- Net interest margin increased by 29 basis points to 3.25% in
the third quarter of 2017 as compared to 2.96% for the second
quarter of 2017, primarily as a result of increasing loan yield
with stable cost of deposits as well as the redemption of
approximately $40 million of
high-cost holding company debt during June and July of
2017.
- Cost of deposits fell one basis point from the prior quarter to
0.39%.
- Quarterly operating expenses fell to $14.5 million in the third quarter, as compared
to $16.3 million in the linked prior
quarter; representing the lowest quarterly expenses since
2002.
- Continuation of solid asset quality trends with non-performing
loans of $4.2 million at September 30, 2017, which is 0.26% of gross
loans. No provision for loan loss was recorded, and net charge-offs
were $250 thousand in the third
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 November 21, 2017, payable on December 5, 2017.
Sun Bancorp, Inc. (NASDAQ: SNBC), (the "Company"), the holding
company for Sun National Bank (the
"Bank"), today reported net income of $2.7
million, or $0.14 per diluted
share, for the quarter ended September 30,
2017, compared to net income of $1.5
million, or $0.08 per diluted
share, for the quarter ended June 30,
2017, and net income of $1.6
million, or $0.09 per diluted
share, for the quarter ended September 30,
2016.
"Our successful efforts in the last three years towards
strengthening capital, building profitability and controlling
expenses continue to produce financial results of better quality
and quantity. Several of our financial ratios are now at or well
above peer levels," stated President & CEO Thomas M. O'Brien. "Entering 2017, the
Company stated that it would continue to focus on improving net
interest margin, the efficiency ratio and return on assets, and the
third quarter demonstrated significant milestone achievements
towards those goals. Despite slowdowns in new business
development, the underlying health and strength of the Company is
further evidenced by the significant increase in our diluted
earnings per share from $0.08 to
$0.14."
Discussion of Results:
Balance Sheet
Total assets decreased to $2.17
billion at September 30, 2017,
as compared to $2.22 billion at
June 30, 2017 and $2.26 billion at December
31, 2016. Cash and cash equivalents totaled $93.5 million at September
30, 2017, as compared to $127.8
million at June 30, 2017 and
$134.2 million at December 31, 2016. The decrease in cash and
cash equivalents during the first nine months of 2017 was primarily
due to a reduction in brokered and subscription deposits and the
recent redemptions of approximately $40
million of trust preferred securities, partially offset by
decreases in net loans receivable and investment securities since
December 31, 2016.
Investment securities decreased by $11.6
million to $288.4 million at
September 30, 2017 from $300.0 million at June 30,
2017 due to pay downs. The Bank did not initiate new
investment purchases in the current quarter as available cash flow
was reinvested into commercial loans.
Net loans totaled $1.57 billion at
each of September 30, 2017 and
June 30, 2017 as compared to
$1.59 billion at December 31, 2016. The decrease of
$19.9 million since year end was due
to several factors. As a result of the reduction in
originations and refinancing activity, non-owner occupied
commercial real estate ("CRE") loans fell by $29.0 million in the nine months ended
September 30, 2017. Residential
and home equity loans declined by $37.7
million over the same period as the Bank's position in these
portfolios continued to decline with no origination activity.
Offsetting these decreases was growth in the commercial and
industrial (C&I) lending segment, which includes owner-occupied
CRE loans and C&I loans, of $33.2
million and an increase in land and development loans of
$12.6 million in the nine months
ended September 30, 2017.
"In the past two quarters, we believe several of the Bank's
non-owner occupied CRE clients have scaled back on activity, due to
potential U.S. tax reform legislative proposals that may have a
material impact on the economics of real estate investments,"
stated O'Brien. "As projected, our C&I activity remained
robust as the Bank continues to evaluate attractive relationship
lending opportunities in this segment."
Total deposits decreased to $1.68
billion at September 30, 2017,
as compared to $1.71 billion at
June 30, 2017 and $1.74 billion at December
31, 2016 due primarily to a $66
million, or 68%, runoff in brokered and subscription
deposits since year-end 2016. The cost of deposits decreased
by one basis point to 39 basis points compared to the prior linked
quarter and increased by five basis points as compared to the nine
months ended September 30, 2016.
"The Bank's slower loan originations as well as our liquidity
position affords us the opportunity to continue to shed
non-relationship brokered and subscription deposits and better
focus on fee-generating relationship deposits," stated
O'Brien. "As a result, we saw a small decrease in overall
cost of deposits despite the increasing external competitive rate
environment."
Net Interest Income and Margin
Net interest income was $16.0
million for the three months ended September 30, 2017, compared to $14.9 million for the three months ended
June 30, 2017, and $14.7 million for the three months ended
September 30, 2016. The Company's net
interest margin was 3.25% for the three months ended September 30, 2017 as compared to 2.96% for three
months ended June 30, 2017 and 2.94%
for the three months ended September
30, 2016. The increase in net interest margin in the
third quarter of 2017 primarily reflects an increase in loan yields
of 16 basis points from the linked prior quarter and the impact of
the recent trust preferred redemptions while deposit cost of funds
fell by one basis point. 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.
"Coming into 2017, the Company had stated that its net interest
margin target would be between 3.00% and 3.10%," said
O'Brien. "In 2017, we effectively de-leveraged our balance
sheet in order to redeem approximately $40
million of our trust preferred securities. Coupled
with the improved yield on our loan portfolio and stable deposit
costs, the Company was able to expand its margin by 29 basis points
to 3.25% for the third quarter of 2017 compared to the prior year
quarter, which is now in line with peer levels. Over the last
three years, the Company has been mindful of the asset-sensitive
nature of its balance sheet, which we believe has positioned us
well in a rising rate environment."
Non-Interest Income
Non-interest income was $2.8
million for the quarter ended September 30, 2017, as compared to $3.0 million and $3.1
million for the quarters ended June
30, 2017 and September 30,
2016, respectively. The decrease in non-interest
income from the quarter ended June 30,
2017 reflects declines in both deposit related fees and
investment products income resulting from mild reductions in fee
paying customers..
Non-Interest Expense
Non-interest expense for the third quarter of 2017 was
$14.5 million as compared to
$16.3 million for the three months
ended June 30, 2017 and $15.9 million for the three months ended
September 30, 2016. The
decrease in non-interest expense from the prior linked quarter is
due primarily to decreases of $1.0
million in other expenses and $491
thousand in professional fees. Other expenses included
$588 thousand of recourse reserve
reversals in the third quarter of 2017 and $166 thousand of lower appraisal fees compared to
the linked prior quarter. Professional fees declined
primarily due to the linked prior quarter including $400 thousand of merger related expenses.
Non-interest expense for the third quarter of 2017 declined by
$1.4 million compared to the third
quarter of 2016, primarily due to the aforementioned recourse
reserve reversals, a decrease of $233
thousand in equipment expense, a decrease of $132 thousand in occupancy expense, a decrease of
$124 thousand in data processing
expense, a $106 thousand decline in
advertising expense and a $105
thousand decrease in professional fees.
"With our quarterly non-interest expenses now falling below
$15 million, we continue to
demonstrate our careful attention to cost management principles,"
said O'Brien. "Rationalization of occupancy costs, reduction
of expenses as a result of diligent risk management, information
technology platform enhancements and strong vendor management are
all contributing factors that have allowed the Company to improve
its operating efficiency. At the beginning of 2017, we stated
that improving the efficiency ratio would be a key objective.
Our efforts have led to a significant improvement in that
metric. The Company's efficiency ratio, which had hovered
above 90% in recent quarters, improved to 77% this quarter."
Asset Quality
Non-performing loans decreased by $228
thousand to $4.2 million, or
0.26% of gross loans, at September 30,
2017 from $4.4 million, or
0.28% of gross loans, at June 30,
2017. During the third quarter of 2017, approximately
$1.0 million of non-performing
residential mortgage loans were sold. This was offset by an
increase in non-performing residential mortgage and commercial real
estate loans of approximately $500
thousand and $300 thousand,
respectively. Non-performing loans were $6.8
million, or 0.42% of gross loans, at September 30, 2016.
There was no provision for loan losses recorded in the three
months ended September 30, 2017,
June 30, 2017 and September 30, 2016. The Bank's credit
portfolio has remained relatively steady with minimal charge-off
activity. While net charge-offs for the third quarter of 2017
were $250 thousand, in the first nine
months of 2017 the Bank recorded net charge-offs of $16 thousand as compared to net charge-offs of
$499 thousand in the first nine
months of 2016. The allowance for loan losses was
$14.7 million, or 0.92% of gross
loans, at September 30, 2017 as
compared to $14.9 million, or 0.94%
of gross loans, at June 30, 2017 and
$15.8 million, or 1.01% of gross
loans, at September 30, 2016.
The allowance for loan losses was 349% of non-performing loans at
September 30, 2017 as compared to
337% of non-performing loans at June 30,
2017 and 238% of non-performing loans at September 30, 2016.
Capital
The Company's capital ratios continue to remain very strong due
to positive earnings and a slightly reduced balance sheet.
All capital ratios remain at robust levels and are sufficient to
support the Company's strategic plan. At September 30, 2017, the Bank had a Tier 1 common
equity risk-based capital ratio of 18.7%, total risk-based capital
ratio of 19.6%, a Tier 1 risk-based capital ratio of 18.7% and a
leverage capital ratio of 14.2%. At September 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
16.5%, 20.2%, 19.2%, and 14.6%, respectively. The Company's
tangible equity to tangible assets ratio was 13.6% at September 30, 2017, as compared to 13.2% at
June 30, 2017 and 10.6% at
September 30, 2016.
Merger Update
On October 24, 2017, the Sun
Bancorp, Inc. shareholders approved the previously announced merger
of the Company with and into OceanFirst Financial Corp. (NASDAQ:
OCFC) ("OceanFirst") with OceanFirst as the surviving entity (the
"Merger"). Regulatory approval of the Merger was received
from the Federal Reserve Bank of Philadelphia on October
17, 2017. The regulatory application for the
transaction remains under review by the Office of the Comptroller
of the Currency ("OCC"). Subject to receipt of OCC approval
and other customary closing conditions, the Company expects to
close the Merger in January 2018.
Dividend Declaration
On October 24, 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 November
21, 2017, payable on December 5,
2017.
"Our primary goal of delivering shareholder value remains
steadfast," stated O'Brien. "The accomplishments of this
quarter and the merger announcement of the previous quarter,
further demonstrate that commitment. We believe our Company
has made tremendous progress in the last three years towards
building profitability, pristine asset quality and a culture of
regulatory excellence and delivering upon the promise of solid
relationship banking. The additional progress we have
achieved in the third quarter is a culmination of those efforts,
and represents an impressive legacy for Sun and all of its various
stakeholders."
About Sun Bancorp, Inc.
Sun Bancorp, Inc. (NASDAQ: SNBC) is a $2.17 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. 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; (ii) the Company's ability to attract and retain key
management and staff; (iii) changes in business strategy or
an inability to successfully execute strategy due to the occurrence
of unanticipated events; (iv) the ability to attract
deposits and other sources of liquidity; (v) changes in the
financial performance and/or condition of the Bank's
borrowers; (vi) changes in consumer spending,
borrowing and saving habits; (vii) the ability to
increase market share and control expenses;
(viii) changes in estimates of future loan loss reserve
requirements based upon the periodic review thereof under relevant
regulatory and accounting requirements; (ix) local, regional
and national economic conditions and events and the impact they may
have on the Company and its customers; (x) volatility in the
credit and equity markets and its effect on the general economy;
(xi) the credit risks of lending activities, including
changes in the level and trend of loan delinquencies and
write-offs; (xii) the overall quality of the composition of the
Company's loan and securities portfolios; (xiii) inflation,
interest rate, securities market and monetary fluctuations;
(xiv)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; (xv) 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; (xvi) competition among providers of
financial services; and (xvii) 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.
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
September 30, 2017, June 30, 2017, March 31,
2017, December 31, 2016 and
September 30, 2016.
|
|
September
30,
2017
|
|
|
June
30,
2017
|
|
|
March
31,
2017
|
|
|
December
31,
2016
|
|
|
September
30,
2016
|
|
Tangible book value
per common share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shareholders'
equity
|
|
$
|
328,599
|
|
|
$
|
325,060
|
|
|
$
|
322,816
|
|
|
$
|
319,709
|
|
|
$
|
265,878
|
|
Less: Intangible
assets
|
|
|
38,188
|
|
|
|
38,188
|
|
|
|
38,188
|
|
|
|
38,188
|
|
|
|
38,188
|
|
Tangible
equity
|
|
$
|
290,411
|
|
|
$
|
286,872
|
|
|
$
|
284,628
|
|
|
$
|
281,521
|
|
|
$
|
227,690
|
|
Common
stock
|
|
|
19,135
|
|
|
|
19,134
|
|
|
|
19,132
|
|
|
|
19,031
|
|
|
|
19,026
|
|
Less: Treasury
stock
|
|
|
73
|
|
|
|
73
|
|
|
|
75
|
|
|
|
108
|
|
|
|
138
|
|
Total outstanding
shares
|
|
|
19,062
|
|
|
|
19,061
|
|
|
|
19,057
|
|
|
|
18,923
|
|
|
|
18,888
|
|
Tangible book value
per common share:
|
|
$
|
15.24
|
|
|
$
|
15.05
|
|
|
$
|
14.94
|
|
|
$
|
14.88
|
|
|
$
|
12.05
|
|
Return on Average Tangible Equity (dollars in
thousands)
The following provides the calculation of return on tangible
equity for the three months ended September
30, 2017, June 30, 2017,
March 31, 2017, December 31, 2016 and September 30, 2016.
|
|
Three Months
Ended
|
|
|
|
September
30,
2017
|
|
|
June
30,
2017
|
|
|
March
31,
2017
|
|
|
December
31,
2016
|
|
|
September
30,
2016
|
|
Net income
|
|
$
|
2,740
|
|
|
$
|
1,455
|
|
|
$
|
1,430
|
|
|
$
|
56,000
|
|
|
$
|
1,630
|
|
Average tangible
equity:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average shareholders'
equity
|
|
$
|
328,994
|
|
|
$
|
325,919
|
|
|
$
|
323,258
|
|
|
$
|
267,542
|
|
|
$
|
266,931
|
|
Less: Average
intangible assets
|
|
|
38,188
|
|
|
|
38,188
|
|
|
|
38,188
|
|
|
|
38,188
|
|
|
|
38,188
|
|
Average tangible
equity
|
|
$
|
290,806
|
|
|
$
|
287,731
|
|
|
$
|
285,070
|
|
|
$
|
229,354
|
|
|
$
|
228,743
|
|
Return on average
tangible equity(1):
|
|
|
3.8
|
%
|
|
|
2.0
|
%
|
|
|
2.0
|
%
|
|
|
97.7
|
%
|
|
|
2.9
|
%
|
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
|
|
|
|
September
30,
|
|
|
September
30,
|
|
|
|
2017
|
|
|
2016
|
|
|
2017
|
|
|
2016
|
|
Profitability for the
period:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest
income
|
|
$
|
16,034
|
|
|
$
|
14,712
|
|
|
$
|
45,670
|
|
|
$
|
44,070
|
|
(Recovery of)
provision for loan losses
|
|
|
—
|
|
|
|
—
|
|
|
|
(831)
|
|
|
|
(1,682)
|
|
Non-interest
income
|
|
|
2,835
|
|
|
|
3,142
|
|
|
|
9,266
|
|
|
|
10,078
|
|
Non-interest
expense
|
|
|
14,509
|
|
|
|
15,937
|
|
|
|
46,860
|
|
|
|
49,527
|
|
Income before income
taxes
|
|
|
4,360
|
|
|
|
1,917
|
|
|
|
8,907
|
|
|
|
6,303
|
|
Income tax
expense
|
|
|
1,620
|
|
|
|
287
|
|
|
|
3,282
|
|
|
|
885
|
|
Net income available
to common shareholders
|
|
$
|
2,740
|
|
|
$
|
1,630
|
|
|
$
|
5,625
|
|
|
$
|
5,418
|
|
Financial
ratios:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Return on average
assets (1)
|
|
|
0.5
|
%
|
|
|
0.3
|
%
|
|
|
0.5
|
%
|
|
|
0.3
|
%
|
Return on average
equity (1)
|
|
|
3.3
|
%
|
|
|
2.4
|
%
|
|
|
3.5
|
%
|
|
|
2.8
|
%
|
Return on average
tangible equity (1), (2)
|
|
|
3.9
|
%
|
|
|
2.9
|
%
|
|
|
3.9
|
%
|
|
|
3.2
|
%
|
Net interest margin
(1)
|
|
|
3.25
|
%
|
|
|
2.94
|
%
|
|
|
3.04
|
%
|
|
|
2.94
|
%
|
Efficiency
ratio
|
|
|
77
|
%
|
|
|
89
|
%
|
|
|
85
|
%
|
|
|
91
|
%
|
Income per common
share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$
|
0.14
|
|
|
$
|
0.09
|
|
|
$
|
0.30
|
|
|
$
|
0.29
|
|
Diluted
|
|
$
|
0.14
|
|
|
$
|
0.09
|
|
|
$
|
0.29
|
|
|
$
|
0.29
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average equity to
average assets
|
|
|
15.0
|
%
|
|
|
12.2
|
%
|
|
|
14.7
|
%
|
|
|
12.1
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
September
30,
|
|
|
December
31,
|
|
|
|
|
|
|
|
2017
|
|
|
2016
|
|
|
|
2016
|
|
|
|
|
|
At
period-end:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
assets
|
|
$
|
2,167,674
|
|
|
$
|
2,189,346
|
|
|
$
|
2,262,262
|
|
|
|
|
|
Total
deposits
|
|
|
1,682,494
|
|
|
|
1,717,634
|
|
|
|
1,741,363
|
|
|
|
|
|
Loans receivable, net
of allowance for loan losses
|
|
|
1,574,498
|
|
|
|
1,550,839
|
|
|
|
1,594,377
|
|
|
|
|
|
Loans
held-for-sale
|
|
|
—
|
|
|
|
1,450
|
|
|
|
—
|
|
|
|
|
|
Investments
|
|
|
288,428
|
|
|
|
308,031
|
|
|
|
311,727
|
|
|
|
|
|
Borrowings
|
|
|
91,236
|
|
|
|
91,861
|
|
|
|
91,708
|
|
|
|
|
|
Junior subordinated
debentures
|
|
|
51,548
|
|
|
|
92,786
|
|
|
|
92,786
|
|
|
|
|
|
Shareholders'
equity
|
|
|
328,599
|
|
|
|
265,878
|
|
|
|
319,709
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Credit quality and
capital ratios (3):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Allowance for loan
losses to gross loans held-for-investment
|
|
|
0.92
|
%
|
|
|
1.01
|
%
|
|
|
0.97
|
%
|
|
|
|
|
Non-performing loans
held-for-investment to gross loans held-for-investment
|
|
|
0.26
|
%
|
|
|
0.42
|
%
|
|
|
0.19
|
%
|
|
|
|
|
Non-performing assets
to total assets
|
|
|
0.19
|
%
|
|
|
0.31
|
%
|
|
|
0.14
|
%
|
|
|
|
|
Allowance for loan
losses to non-performing loans held-for-investment
|
|
|
349
|
%
|
|
|
238
|
%
|
|
|
501
|
%
|
|
|
|
|
Tier 1 common equity
risk-based capital:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sun Bancorp,
Inc.
|
|
|
16.5
|
%
|
|
|
14.5
|
%
|
|
|
16.0
|
%
|
|
|
|
|
Sun National
Bank
|
|
|
18.7
|
%
|
|
|
18.3
|
%
|
|
|
18.9
|
%
|
|
|
|
|
Total risk-based
capital:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sun Bancorp,
Inc.
|
|
|
20.2
|
%
|
|
|
21.2
|
%
|
|
|
21.6
|
%
|
|
|
|
|
Sun National
Bank
|
|
|
19.6
|
%
|
|
|
19.3
|
%
|
|
|
19.8
|
%
|
|
|
|
|
Tier 1 risk-based
capital:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sun Bancorp,
Inc.
|
|
|
19.2
|
%
|
|
|
18.1
|
%
|
|
|
18.9
|
%
|
|
|
|
|
Sun National
Bank
|
|
|
18.7
|
%
|
|
|
18.3
|
%
|
|
|
18.9
|
%
|
|
|
|
|
Leverage
capital:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sun Bancorp,
Inc.
|
|
|
14.6
|
%
|
|
|
13.3
|
%
|
|
|
14.6
|
%
|
|
|
|
|
Sun National
Bank
|
|
|
14.2
|
%
|
|
|
13.4
|
%
|
|
|
14.5
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Book value per common
share
|
|
$
|
17.25
|
|
|
$
|
14.08
|
|
|
$
|
16.94
|
|
|
|
|
|
Tangible book value
per common share
|
|
$
|
15.24
|
|
|
$
|
12.05
|
|
|
$
|
14.94
|
|
|
|
|
|
|
|
(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)
|
September 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)
|
|
|
|
September
30,
|
|
|
December
31,
|
|
|
|
2017
|
|
|
2016
|
|
ASSETS
|
|
|
|
|
|
|
|
|
Cash and due from
banks
|
|
$
|
20,180
|
|
|
$
|
19,645
|
|
Interest earning bank
balances
|
|
|
73,278
|
|
|
|
114,563
|
|
Cash and cash
equivalents
|
|
|
93,458
|
|
|
|
134,208
|
|
Restricted
cash
|
|
|
1,000
|
|
|
|
5,000
|
|
Investment securities
available for sale (amortized cost of $274,374 and $300,028
at September 30, 2017 and December
31, 2016, respectively)
|
|
|
271,334
|
|
|
|
295,686
|
|
Investment securities
held to maturity (estimated fair value of $250 at
September 30, 2017 and December 31,
2016)
|
|
|
250
|
|
|
|
250
|
|
Loans receivable (net
of allowance for loan losses of $14,694 and $15,541
at September 30, 2017 and
December 31, 2016, respectively)
|
|
|
1,574,498
|
|
|
|
1,594,377
|
|
Restricted equity
investments, at cost
|
|
|
16,844
|
|
|
|
15,791
|
|
Bank properties and
equipment, net
|
|
|
28,225
|
|
|
|
30,148
|
|
Accrued interest
receivable
|
|
|
5,161
|
|
|
|
5,122
|
|
Goodwill
|
|
|
38,188
|
|
|
|
38,188
|
|
Bank owned life
insurance (BOLI)
|
|
|
84,572
|
|
|
|
83,109
|
|
Deferred taxes,
net
|
|
|
47,872
|
|
|
|
51,573
|
|
Other
assets
|
|
|
6,272
|
|
|
|
8,810
|
|
Total
assets
|
|
$
|
2,167,674
|
|
|
$
|
2,262,262
|
|
LIABILITIES AND
SHAREHOLDERS' EQUITY
|
|
|
|
|
|
|
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
Deposits
|
|
$
|
1,682,494
|
|
|
$
|
1,741,363
|
|
Advances from the
Federal Home Loan Bank of New York (FHLBNY)
|
|
|
85,266
|
|
|
|
85,416
|
|
Obligations under
capital lease
|
|
|
5,970
|
|
|
|
6,292
|
|
Junior subordinated
debentures
|
|
|
51,548
|
|
|
|
92,786
|
|
Other
liabilities
|
|
|
13,797
|
|
|
|
16,696
|
|
Total
liabilities
|
|
|
1,839,075
|
|
|
|
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; 19,134,685 shares issued
and 19,092,748 shares outstanding
at September 30, 2017; 19,030,704 shares issued and 18,922,726
shares outstanding at December 31, 2016.
|
|
|
95,673
|
|
|
|
95,154
|
|
Additional paid-in
capital
|
|
|
508,869
|
|
|
|
508,593
|
|
Retained
deficit
|
|
|
(271,448)
|
|
|
|
(276,501)
|
|
Accumulated other
comprehensive loss
|
|
|
(1,798)
|
|
|
|
(2,568)
|
|
Deferred compensation
plan trust
|
|
|
(1,276)
|
|
|
|
(1,160)
|
|
Treasury stock at
cost, 41,937 shares at September 30, 2017 and 107,978 shares
at December 31, 2016.
|
|
|
(1,421)
|
|
|
|
(3,809)
|
|
Total shareholders'
equity
|
|
|
328,599
|
|
|
|
319,709
|
|
Total liabilities and
shareholders' equity
|
|
$
|
2,167,674
|
|
|
$
|
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 Nine
Months Ended
|
|
|
|
September
30,
|
|
|
September
30,
|
|
|
|
2017
|
|
|
2016
|
|
|
2017
|
|
|
2016
|
|
INTEREST
INCOME:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest and fees on
loans
|
|
$
|
16,659
|
|
|
$
|
15,582
|
|
|
$
|
48,557
|
|
|
$
|
46,278
|
|
Interest on taxable
investment securities
|
|
|
1,737
|
|
|
|
1,657
|
|
|
|
5,319
|
|
|
|
4,956
|
|
Dividends on
restricted equity investments
|
|
|
247
|
|
|
|
220
|
|
|
|
715
|
|
|
|
657
|
|
Total interest
income
|
|
|
18,643
|
|
|
|
17,459
|
|
|
|
54,591
|
|
|
|
51,891
|
|
INTEREST
EXPENSE:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest on
deposits
|
|
|
1,659
|
|
|
|
1,556
|
|
|
|
5,038
|
|
|
|
4,304
|
|
Interest on funds
borrowed
|
|
|
537
|
|
|
|
545
|
|
|
|
1,602
|
|
|
|
1,631
|
|
Interest on junior
subordinated debentures
|
|
|
413
|
|
|
|
646
|
|
|
|
2,281
|
|
|
|
1,886
|
|
Total interest
expense
|
|
|
2,609
|
|
|
|
2,747
|
|
|
|
8,921
|
|
|
|
7,821
|
|
Net interest
income
|
|
|
16,034
|
|
|
|
14,712
|
|
|
|
45,670
|
|
|
|
44,070
|
|
(RECOVERY OF)
PROVISION FOR LOAN LOSSES
|
|
|
—
|
|
|
|
—
|
|
|
|
(831)
|
|
|
|
(1,682)
|
|
Net interest income
after provision for loan losses
|
|
|
16,034
|
|
|
|
14,712
|
|
|
|
46,501
|
|
|
|
45,752
|
|
NON-INTEREST
INCOME:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Deposit service
charges and fees
|
|
|
1,350
|
|
|
|
1,540
|
|
|
|
4,119
|
|
|
|
4,737
|
|
Interchange
fees
|
|
|
483
|
|
|
|
451
|
|
|
|
1,460
|
|
|
|
1,422
|
|
Gain on sale of
loans
|
|
|
—
|
|
|
|
41
|
|
|
|
—
|
|
|
|
41
|
|
Gain on sale of
investment securities
|
|
|
—
|
|
|
|
—
|
|
|
|
30
|
|
|
|
426
|
|
Investment products
income
|
|
|
293
|
|
|
|
505
|
|
|
|
905
|
|
|
|
1,419
|
|
BOLI income
|
|
|
491
|
|
|
|
485
|
|
|
|
1,463
|
|
|
|
1,482
|
|
Other
income
|
|
|
218
|
|
|
|
120
|
|
|
|
1,289
|
|
|
|
551
|
|
Total non-interest
income
|
|
|
2,835
|
|
|
|
3,142
|
|
|
|
9,266
|
|
|
|
10,078
|
|
NON-INTEREST
EXPENSE:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Salaries and employee
benefits
|
|
|
8,821
|
|
|
|
8,649
|
|
|
|
26,669
|
|
|
|
27,045
|
|
Occupancy
expense
|
|
|
2,141
|
|
|
|
2,273
|
|
|
|
6,742
|
|
|
|
6,756
|
|
Equipment
expense
|
|
|
1,070
|
|
|
|
1,303
|
|
|
|
3,369
|
|
|
|
3,462
|
|
Data processing
expense
|
|
|
992
|
|
|
|
1,116
|
|
|
|
2,923
|
|
|
|
3,379
|
|
Professional
fees
|
|
|
625
|
|
|
|
730
|
|
|
|
2,277
|
|
|
|
1,738
|
|
Insurance
expense
|
|
|
389
|
|
|
|
452
|
|
|
|
1,192
|
|
|
|
1,796
|
|
Advertising
expense
|
|
|
306
|
|
|
|
412
|
|
|
|
964
|
|
|
|
1,187
|
|
Problem loan
expense
|
|
|
75
|
|
|
|
131
|
|
|
|
279
|
|
|
|
350
|
|
Other
expense
|
|
|
90
|
|
|
|
871
|
|
|
|
2,445
|
|
|
|
3,814
|
|
Total non-interest
expense
|
|
|
14,509
|
|
|
|
15,937
|
|
|
|
46,860
|
|
|
|
49,527
|
|
INCOME BEFORE
INCOME TAXES
|
|
|
4,360
|
|
|
|
1,917
|
|
|
|
8,907
|
|
|
|
6,303
|
|
INCOME TAX
EXPENSE
|
|
|
1,620
|
|
|
|
287
|
|
|
|
3,282
|
|
|
|
885
|
|
NET INCOME
AVAILABLE TO COMMON
SHAREHOLDERS
|
|
$
|
2,740
|
|
|
$
|
1,630
|
|
|
$
|
5,625
|
|
|
$
|
5,418
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings per
share
|
|
$
|
0.14
|
|
|
$
|
0.09
|
|
|
$
|
0.30
|
|
|
$
|
0.29
|
|
Diluted earnings per
share
|
|
$
|
0.14
|
|
|
$
|
0.09
|
|
|
$
|
0.29
|
|
|
$
|
0.29
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
shares - basic
|
|
|
19,088,192
|
|
|
|
18,874,577
|
|
|
|
19,044,985
|
|
|
|
18,821,047
|
|
Weighted average
shares - diluted
|
|
|
19,188,490
|
|
|
|
18,962,740
|
|
|
|
19,162,414
|
|
|
|
18,909,867
|
|
SUN BANCORP, INC. AND
SUBSIDIARIES
|
HISTORICAL TRENDS IN
QUARTERLY FINANCIAL DATA (Unaudited)
|
(dollars in
thousands)
|
|
|
|
2017
|
|
|
2017
|
|
|
2016
|
|
|
2016
|
|
|
2016
|
|
|
|
|
Q3
|
|
|
Q2
|
|
|
Q1
|
|
|
Q4
|
|
|
Q3
|
|
|
Profitability for the
quarter:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest
income
|
|
$
|
16,034
|
|
|
$
|
14,863
|
|
|
$
|
14,772
|
|
|
$
|
14,834
|
|
|
$
|
14,712
|
|
|
(Recovery of)
provision for loan losses
|
|
|
—
|
|
|
|
(831)
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
Non-interest
income
|
|
|
2,835
|
|
|
|
3,000
|
|
|
|
3,431
|
|
|
|
3,311
|
|
|
|
3,142
|
|
|
Non-interest
expense
|
|
|
14,509
|
|
|
|
16,289
|
|
|
|
16,062
|
|
|
|
15,425
|
|
|
|
15,937
|
|
|
Income before income
taxes
|
|
|
4,360
|
|
|
|
2,405
|
|
|
|
2,141
|
|
|
|
2,720
|
|
|
|
1,917
|
|
|
Income tax expense
(benefit)
|
|
|
1,620
|
|
|
|
950
|
|
|
|
711
|
|
|
|
(53,280)
|
|
|
|
287
|
|
|
Net income available
to common shareholders
|
|
$
|
2,740
|
|
|
$
|
1,455
|
|
|
$
|
1,430
|
|
|
$
|
56,000
|
|
|
$
|
1,630
|
|
|
Financial
ratios:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Return on average
assets (1)
|
|
|
0.5
|
%
|
|
|
0.3
|
%
|
|
|
0.3
|
%
|
|
|
10.2
|
%
|
|
|
0.3
|
%
|
|
Return on average
equity (1)
|
|
|
3.3
|
%
|
|
|
1.8
|
%
|
|
|
1.8
|
%
|
|
|
83.7
|
%
|
|
|
2.4
|
%
|
|
Return on average
tangible equity (1), (2)
|
|
|
3.9
|
%
|
|
|
2.0
|
%
|
|
|
2.0
|
%
|
|
|
97.7
|
%
|
|
|
2.9
|
%
|
|
Net interest margin
(1)
|
|
|
3.25
|
%
|
|
|
2.96
|
%
|
|
|
2.93
|
%
|
|
|
2.93
|
%
|
|
|
2.94
|
%
|
|
Efficiency
ratio
|
|
|
77
|
%
|
|
|
91
|
%
|
|
|
88
|
%
|
|
|
85
|
%
|
|
|
89
|
%
|
|
Per share
data :
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income per common
share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$
|
0.14
|
|
|
$
|
0.08
|
|
|
$
|
0.08
|
|
|
$
|
2.96
|
|
|
$
|
0.09
|
|
|
Diluted
|
|
$
|
0.14
|
|
|
$
|
0.08
|
|
|
$
|
0.07
|
|
|
$
|
2.94
|
|
|
$
|
0.09
|
|
|
Book value
|
|
$
|
17.25
|
|
|
$
|
17.05
|
|
|
$
|
16.94
|
|
|
$
|
16.90
|
|
|
$
|
14.08
|
|
|
Tangible book
value
|
|
$
|
15.24
|
|
|
$
|
15.05
|
|
|
$
|
14.94
|
|
|
$
|
14.88
|
|
|
$
|
12.05
|
|
|
Cash dividends
paid
|
|
$
|
0.01
|
|
|
$
|
0.01
|
|
|
$
|
0.01
|
|
|
$
|
0.01
|
|
|
$
|
0.01
|
|
|
Average basic
shares
|
|
|
19,088,192
|
|
|
|
19,059,626
|
|
|
|
18,986,015
|
|
|
|
18,908,688
|
|
|
|
18,874,577
|
|
|
Average diluted
shares
|
|
|
19,188,490
|
|
|
|
19,191,294
|
|
|
|
19,107,226
|
|
|
|
19,016,188
|
|
|
|
18,962,740
|
|
|
Non-interest
income:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Deposit service
charges and fees
|
|
$
|
1,350
|
|
|
$
|
1,367
|
|
|
$
|
1,402
|
|
|
$
|
1,484
|
|
|
$
|
1,540
|
|
|
Interchange
fees
|
|
|
483
|
|
|
|
510
|
|
|
|
467
|
|
|
|
483
|
|
|
|
451
|
|
|
Gain on sale of
investment securities
|
|
|
—
|
|
|
|
26
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
Gain on sale of
loans
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
60
|
|
|
|
41
|
|
|
Investment products
income
|
|
|
293
|
|
|
|
327
|
|
|
|
284
|
|
|
|
288
|
|
|
|
505
|
|
|
BOLI income
|
|
|
491
|
|
|
|
488
|
|
|
|
484
|
|
|
|
452
|
|
|
|
485
|
|
|
Other
income
|
|
|
218
|
|
|
|
282
|
|
|
|
794
|
|
|
|
544
|
|
|
|
120
|
|
|
Total non-interest
income
|
|
$
|
2,835
|
|
|
$
|
3,000
|
|
|
$
|
3,431
|
|
|
$
|
3,311
|
|
|
$
|
3,142
|
|
|
Non-interest
expense:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Salaries and employee
benefits
|
|
$
|
8,821
|
|
|
$
|
8,966
|
|
|
$
|
8,882
|
|
|
$
|
7,926
|
|
|
$
|
8,649
|
|
|
Occupancy
expense
|
|
|
2,141
|
|
|
|
2,252
|
|
|
|
2,350
|
|
|
|
2,232
|
|
|
|
2,273
|
|
|
Equipment
expense
|
|
|
1,070
|
|
|
|
1,142
|
|
|
|
1,157
|
|
|
|
1,324
|
|
|
|
1,303
|
|
|
Data processing
expense
|
|
|
992
|
|
|
|
911
|
|
|
|
1,019
|
|
|
|
1,124
|
|
|
|
1,116
|
|
|
Professional
fees
|
|
|
625
|
|
|
|
1,116
|
|
|
|
536
|
|
|
|
508
|
|
|
|
730
|
|
|
Insurance
expense
|
|
|
389
|
|
|
|
408
|
|
|
|
395
|
|
|
|
368
|
|
|
|
452
|
|
|
Advertising
expense
|
|
|
306
|
|
|
|
346
|
|
|
|
313
|
|
|
|
473
|
|
|
|
412
|
|
|
Problem loan
expenses
|
|
|
75
|
|
|
|
70
|
|
|
|
134
|
|
|
|
61
|
|
|
|
131
|
|
|
Other
expenses
|
|
|
90
|
|
|
|
1,078
|
|
|
|
1,276
|
|
|
|
1,409
|
|
|
|
871
|
|
|
Total non-interest
expense
|
|
$
|
14,509
|
|
|
$
|
16,289
|
|
|
$
|
16,062
|
|
|
$
|
15,425
|
|
|
$
|
15,937
|
|
|
|
|
(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
|
|
|
2017
|
|
|
2016
|
|
|
2016
|
|
|
|
Q3
|
|
|
Q2
|
|
|
Q1
|
|
|
Q4
|
|
|
Q3
|
|
Balance Sheet at
quarter end:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
93,458
|
|
|
$
|
127,831
|
|
|
$
|
128,892
|
|
|
$
|
134,208
|
|
|
$
|
156,292
|
|
Restricted
cash
|
|
|
1,000
|
|
|
|
1,000
|
|
|
|
1,000
|
|
|
|
5,000
|
|
|
|
5,000
|
|
Investment
securities
|
|
|
288,428
|
|
|
|
299,987
|
|
|
|
315,558
|
|
|
|
311,727
|
|
|
|
308,031
|
|
Loans
held-for-investment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Commercial and
industrial
|
|
|
258,360
|
|
|
|
251,346
|
|
|
|
230,306
|
|
|
|
235,946
|
|
|
|
226,493
|
|
Commercial real estate
- owner occupied
|
|
|
242,178
|
|
|
|
250,164
|
|
|
|
261,971
|
|
|
|
231,348
|
|
|
|
226,165
|
|
Commercial real estate
- non-owner occupied
|
|
|
713,624
|
|
|
|
710,831
|
|
|
|
729,102
|
|
|
|
742,662
|
|
|
|
676,323
|
|
Land and
development
|
|
|
79,957
|
|
|
|
67,042
|
|
|
|
67,336
|
|
|
|
67,165
|
|
|
|
84,692
|
|
Residential real
estate
|
|
|
187,338
|
|
|
|
196,157
|
|
|
|
205,573
|
|
|
|
210,874
|
|
|
|
226,691
|
|
Home equity and
other
|
|
|
107,735
|
|
|
|
113,572
|
|
|
|
116,187
|
|
|
|
121,923
|
|
|
|
126,302
|
|
Total loans
|
|
|
1,589,192
|
|
|
|
1,589,112
|
|
|
|
1,610,475
|
|
|
|
1,609,918
|
|
|
|
1,566,666
|
|
Allowance for loan
losses
|
|
|
(14,694)
|
|
|
|
(14,945)
|
|
|
|
(15,716)
|
|
|
|
(15,541)
|
|
|
|
(15,827)
|
|
Net loans
held-for-investment
|
|
|
1,574,498
|
|
|
|
1,574,167
|
|
|
|
1,594,759
|
|
|
|
1,594,377
|
|
|
|
1,550,839
|
|
Loans
held-for-sale
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
1,450
|
|
Goodwill
|
|
|
38,188
|
|
|
|
38,188
|
|
|
|
38,188
|
|
|
|
38,188
|
|
|
|
38,188
|
|
Total
assets
|
|
|
2,167,674
|
|
|
|
2,216,802
|
|
|
|
2,255,773
|
|
|
|
2,262,262
|
|
|
|
2,189,346
|
|
Net deferred tax
asset, before valuation allowance
|
|
|
121,058
|
|
|
|
123,107
|
|
|
|
125,238
|
|
|
|
124,574
|
|
|
|
125,051
|
|
Deferred tax valuation
allowance
|
|
|
(73,186)
|
|
|
|
(73,665)
|
|
|
|
(73,665)
|
|
|
|
(127,973)
|
|
|
|
(128,362)
|
|
Total
deposits
|
|
|
1,682,494
|
|
|
|
1,708,253
|
|
|
|
1,733,989
|
|
|
|
1,741,363
|
|
|
|
1,717,634
|
|
Advances from the
FHLBNY
|
|
|
85,266
|
|
|
|
85,317
|
|
|
|
85,367
|
|
|
|
85,416
|
|
|
|
85,465
|
|
Obligations under
capital leases
|
|
|
5,970
|
|
|
|
6,079
|
|
|
|
6,187
|
|
|
|
6,292
|
|
|
|
6,396
|
|
Junior subordinated
debentures
|
|
|
51,548
|
|
|
|
77,322
|
|
|
|
92,786
|
|
|
|
92,786
|
|
|
|
92,786
|
|
Total shareholders'
equity
|
|
|
328,599
|
|
|
|
325,060
|
|
|
|
322,816
|
|
|
|
319,709
|
|
|
|
265,878
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarterly average
balance sheet:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans
held-for-investment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Commercial
|
|
$
|
1,281,922
|
|
|
$
|
1,288,517
|
|
|
$
|
1,270,543
|
|
|
$
|
1,238,749
|
|
|
$
|
1,215,135
|
|
Residential real
estate
|
|
|
193,663
|
|
|
|
202,659
|
|
|
|
209,500
|
|
|
|
220,502
|
|
|
|
233,277
|
|
Home equity and
other
|
|
|
109,842
|
|
|
|
114,330
|
|
|
|
117,963
|
|
|
|
122,290
|
|
|
|
128,078
|
|
Total loans
|
|
|
1,585,427
|
|
|
|
1,605,506
|
|
|
|
1,598,006
|
|
|
|
1,581,541
|
|
|
|
1,576,490
|
|
Securities and other
interest-earning assets
|
|
|
387,243
|
|
|
|
405,240
|
|
|
|
417,171
|
|
|
|
442,409
|
|
|
|
425,042
|
|
Total interest-earning
assets
|
|
|
1,972,670
|
|
|
|
2,010,746
|
|
|
|
2,015,177
|
|
|
|
2,023,950
|
|
|
|
2,001,532
|
|
Total
assets
|
|
|
2,191,588
|
|
|
|
2,231,978
|
|
|
|
2,240,787
|
|
|
|
2,201,886
|
|
|
|
2,187,482
|
|
Non-interest-bearing
demand deposits
|
|
|
414,554
|
|
|
|
409,694
|
|
|
|
402,949
|
|
|
|
411,728
|
|
|
|
402,465
|
|
Total
deposits
|
|
|
1,700,655
|
|
|
|
1,707,873
|
|
|
|
1,717,848
|
|
|
|
1,731,312
|
|
|
|
1,709,863
|
|
Total interest-bearing
liabilities
|
|
|
1,435,395
|
|
|
|
1,482,256
|
|
|
|
1,499,303
|
|
|
|
1,504,138
|
|
|
|
1,492,139
|
|
Total shareholders'
equity
|
|
|
328,994
|
|
|
|
325,919
|
|
|
|
323,258
|
|
|
|
267,542
|
|
|
|
266,931
|
|
SUN BANCORP, INC. AND
SUBSIDIARIES
|
HISTORICAL TRENDS IN
QUARTERLY FINANCIAL DATA (Unaudited)
|
(dollars in
thousands)
|
|
|
|
2017
|
|
|
2017
|
|
|
2017
|
|
|
2016
|
|
|
2016
|
|
|
|
Q3
|
|
|
Q2
|
|
|
Q1
|
|
|
Q4
|
|
|
Q3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Capital and credit
quality measures:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tier 1 common equity
risk-based capital (1):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sun Bancorp,
Inc.
|
|
|
16.5
|
%
|
|
|
16.2
|
%
|
|
|
15.8
|
%
|
|
|
16.0
|
%
|
|
|
14.5
|
%
|
Sun National
Bank
|
|
|
18.7
|
%
|
|
|
18.3
|
%
|
|
|
17.8
|
%
|
|
|
18.9
|
%
|
|
|
18.3
|
%
|
Total risk-based
capital:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sun Bancorp,
Inc.
|
|
|
20.2
|
%
|
|
|
21.4
|
%
|
|
|
21.9
|
%
|
|
|
21.6
|
%
|
|
|
21.2
|
%
|
Sun National
Bank
|
|
|
19.6
|
%
|
|
|
19.3
|
%
|
|
|
18.8
|
%
|
|
|
19.8
|
%
|
|
|
19.3
|
%
|
Tier 1 risk-based
capital:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sun Bancorp,
Inc.
|
|
|
19.2
|
%
|
|
|
19.7
|
%
|
|
|
19.2
|
%
|
|
|
18.9
|
%
|
|
|
18.1
|
%
|
Sun National
Bank
|
|
|
18.7
|
%
|
|
|
18.3
|
%
|
|
|
17.8
|
%
|
|
|
18.9
|
%
|
|
|
18.3
|
%
|
Leverage
capital:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sun Bancorp,
Inc.
|
|
|
14.6
|
%
|
|
|
14.7
|
%
|
|
|
14.5
|
%
|
|
|
14.6
|
%
|
|
|
13.3
|
%
|
Sun National
Bank
|
|
|
14.2
|
%
|
|
|
13.6
|
%
|
|
|
13.4
|
%
|
|
|
14.5
|
%
|
|
|
13.4
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average equity to
average assets
|
|
|
15.0
|
%
|
|
|
14.6
|
%
|
|
|
14.4
|
%
|
|
|
12.2
|
%
|
|
|
12.2
|
%
|
Allowance for loan
losses to gross loans held-for-investment
|
|
|
0.92
|
%
|
|
|
0.94
|
%
|
|
|
0.98
|
%
|
|
|
0.97
|
%
|
|
|
1.01
|
%
|
Non-performing loans
held-for-investment to gross loans held-for-investment
|
|
|
0.26
|
%
|
|
|
0.28
|
%
|
|
|
0.25
|
%
|
|
|
0.19
|
%
|
|
|
0.42
|
%
|
Non-performing assets
to total assets
|
|
|
0.19
|
%
|
|
|
0.20
|
%
|
|
|
0.18
|
%
|
|
|
0.14
|
%
|
|
|
0.31
|
%
|
Allowance for loan
losses to non-performing loans held-for-investment
|
|
|
349
|
%
|
|
|
337
|
%
|
|
|
385
|
%
|
|
|
501
|
%
|
|
|
238
|
%
|
Other
data:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net (charge-offs)
recoveries
|
|
|
(250)
|
|
|
|
59
|
|
|
|
175
|
|
|
|
(285)
|
|
|
|
(65)
|
|
Classified
loans
|
|
|
7,350
|
|
|
|
7,979
|
|
|
|
7,752
|
|
|
|
6,887
|
|
|
|
8,593
|
|
Classified
assets
|
|
|
10,556
|
|
|
|
11,185
|
|
|
|
10,958
|
|
|
|
10,094
|
|
|
|
11,799
|
|
Non-performing
assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-accrual
loans
|
|
|
2,727
|
|
|
|
2,934
|
|
|
|
2,682
|
|
|
|
1,697
|
|
|
|
3,246
|
|
Non-accrual loans
held-for-sale
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
178
|
|
Troubled debt
restructurings, non-accrual
|
|
|
1,481
|
|
|
|
1,502
|
|
|
|
1,395
|
|
|
|
1,404
|
|
|
|
3,396
|
|
Total non-performing
assets
|
|
$
|
4,208
|
|
|
$
|
4,436
|
|
|
$
|
4,077
|
|
|
$
|
3,101
|
|
|
$
|
6,820
|
|
|
|
(1)
|
September 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
|
|
|
|
|
September 30,
2017
|
|
|
September 30,
2016
|
|
|
|
|
Average
|
|
|
|
|
|
|
Average
|
|
|
Average
|
|
|
|
|
|
|
Average
|
|
|
|
|
Balance
|
|
|
Interest
|
|
|
Yield/Cost
|
|
|
Balance
|
|
|
Interest
|
|
|
Yield/Cost
|
|
|
Interest-earning
assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans receivable
(1), (2)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Commercial
|
|
$
|
1,281,922
|
|
|
$
|
13,732
|
|
|
|
4.28
|
|
%
|
$
|
1,215,135
|
|
|
$
|
12,230
|
|
|
|
4.03
|
|
%
|
Home equity and
other
|
|
|
109,842
|
|
|
|
1,285
|
|
|
|
4.68
|
|
|
|
128,078
|
|
|
|
1,354
|
|
|
|
4.23
|
|
|
Residential real
estate
|
|
|
193,663
|
|
|
|
1,643
|
|
|
|
3.39
|
|
|
|
233,277
|
|
|
|
1,998
|
|
|
|
3.43
|
|
|
Total loans
receivable
|
|
|
1,585,427
|
|
|
|
16,660
|
|
|
|
4.20
|
|
|
|
1,576,490
|
|
|
|
15,582
|
|
|
|
3.95
|
|
|
Investment
securities
|
|
|
295,885
|
|
|
|
1,694
|
|
|
|
2.29
|
|
|
|
312,629
|
|
|
|
1,734
|
|
|
|
2.22
|
|
|
Interest-earning bank
balances
|
|
|
91,358
|
|
|
|
289
|
|
|
|
1.27
|
|
|
|
112,413
|
|
|
|
144
|
|
|
|
0.51
|
|
|
Total interest-earning
assets
|
|
|
1,972,670
|
|
|
|
18,643
|
|
|
|
3.78
|
|
|
|
2,001,532
|
|
|
|
17,460
|
|
|
|
3.49
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
non-interest-earning assets
|
|
|
218,918
|
|
|
|
|
|
|
|
|
|
|
|
185,950
|
|
|
|
|
|
|
|
|
|
|
Total
assets
|
|
$
|
2,191,588
|
|
|
|
|
|
|
|
|
|
|
$
|
2,187,482
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing
liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing
deposit accounts:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing
demand deposit
|
|
$
|
667,538
|
|
|
|
409
|
|
|
|
0.25
|
|
%
|
$
|
678,636
|
|
|
|
374
|
|
|
|
0.22
|
|
%
|
Savings
deposits
|
|
|
248,680
|
|
|
|
216
|
|
|
|
0.35
|
|
|
|
241,960
|
|
|
|
202
|
|
|
|
0.33
|
|
|
Time
deposits
|
|
|
369,883
|
|
|
|
1,033
|
|
|
|
1.12
|
|
|
|
386,802
|
|
|
|
981
|
|
|
|
1.01
|
|
|
Total interest-bearing
deposit accounts
|
|
|
1,286,101
|
|
|
|
1,658
|
|
|
|
0.52
|
|
|
|
1,307,398
|
|
|
|
1,557
|
|
|
|
0.48
|
|
|
Long-term
borrowings:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FHLBNY
Advances
|
|
|
85,283
|
|
|
|
432
|
|
|
|
2.03
|
|
|
|
85,514
|
|
|
|
434
|
|
|
|
2.03
|
|
|
Obligations under
capital lease
|
|
|
6,019
|
|
|
|
105
|
|
|
|
6.98
|
|
|
|
6,441
|
|
|
|
110
|
|
|
|
6.83
|
|
|
Junior subordinated
debentures
|
|
|
57,992
|
|
|
|
413
|
|
|
|
2.85
|
|
|
|
92,786
|
|
|
|
646
|
|
|
|
2.78
|
|
|
Total
borrowings
|
|
|
149,294
|
|
|
|
950
|
|
|
|
2.55
|
|
|
|
184,741
|
|
|
|
1,190
|
|
|
|
2.58
|
|
|
Total
interest-bearing liabilities
|
|
|
1,435,395
|
|
|
|
2,608
|
|
|
|
0.73
|
|
|
|
1,492,139
|
|
|
|
2,747
|
|
|
|
0.74
|
|
|
Non-interest-bearing
liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-interest-bearing
demand deposits
|
|
|
414,554
|
|
|
|
|
|
|
|
|
|
|
|
402,465
|
|
|
|
|
|
|
|
|
|
|
Other
liabilities
|
|
|
12,645
|
|
|
|
|
|
|
|
|
|
|
|
25,947
|
|
|
|
|
|
|
|
|
|
|
Total
non-interest-bearing liabilities
|
|
|
427,199
|
|
|
|
|
|
|
|
|
|
|
|
428,412
|
|
|
|
|
|
|
|
|
|
|
Total
liabilities
|
|
|
1,862,594
|
|
|
|
|
|
|
|
|
|
|
|
1,920,551
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shareholders'
equity
|
|
|
328,994
|
|
|
|
|
|
|
|
|
|
|
|
266,931
|
|
|
|
|
|
|
|
|
|
|
Total liabilities and
shareholders' equity
|
|
$
|
2,191,588
|
|
|
|
|
|
|
|
|
|
|
$
|
2,187,482
|
|
|
|
|
|
|
|
|
|
|
Net interest
income
|
|
|
|
|
|
$
|
16,035
|
|
|
|
|
|
|
|
|
|
|
$
|
14,713
|
|
|
|
|
|
|
Interest rate spread
(3)
|
|
|
|
|
|
|
|
|
|
|
3.05
|
|
%
|
|
|
|
|
|
|
|
|
|
2.75
|
|
%
|
Net interest margin
(4)
|
|
|
|
|
|
|
|
|
|
|
3.25
|
|
%
|
|
|
|
|
|
|
|
|
|
2.94
|
|
%
|
Ratio of average
interest-earning assets
to
average interest-bearing liabilities
|
|
|
|
|
|
|
|
|
|
|
137
|
|
%
|
|
|
|
|
|
|
|
|
|
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 Nine
Months Ended
|
|
|
For the Nine
Months Ended
|
|
|
|
|
September 30,
2017
|
|
|
September 30,
2016
|
|
|
|
|
Average
|
|
|
|
|
|
|
Average
|
|
|
Average
|
|
|
|
|
|
|
Average
|
|
|
|
|
Balance
|
|
|
Interest
|
|
|
Yield/Cost
|
|
|
Balance
|
|
|
Interest
|
|
|
Yield/Cost
|
|
|
Interest-earning
assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans receivable
(1), (2)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Commercial and
industrial
|
|
$
|
1,280,369
|
|
|
$
|
39,570
|
|
|
|
4.11
|
|
%
|
$
|
1,190,942
|
|
|
$
|
35,800
|
|
|
|
4.00
|
|
%
|
Home equity
|
|
|
114,014
|
|
|
|
3,814
|
|
|
|
4.45
|
|
|
|
135,368
|
|
|
|
4,282
|
|
|
|
4.21
|
|
|
Residential real
estate
|
|
|
201,883
|
|
|
|
5,173
|
|
|
|
3.41
|
|
|
|
240,498
|
|
|
|
6,197
|
|
|
|
3.43
|
|
|
Total loans
receivable
|
|
|
1,596,266
|
|
|
|
48,557
|
|
|
|
4.05
|
|
|
|
1,566,808
|
|
|
|
46,279
|
|
|
|
3.93
|
|
|
Investment
securities
|
|
|
305,315
|
|
|
|
5,282
|
|
|
|
2.30
|
|
|
|
301,579
|
|
|
|
5,124
|
|
|
|
2.26
|
|
|
Interest-earning bank
balances
|
|
|
97,793
|
|
|
|
751
|
|
|
|
1.02
|
|
|
|
128,691
|
|
|
|
489
|
|
|
|
0.51
|
|
|
Total interest-earning
assets
|
|
|
1,999,374
|
|
|
|
54,590
|
|
|
|
3.63
|
|
|
|
1,997,078
|
|
|
|
51,892
|
|
|
|
3.46
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
non-interest-earning assets
|
|
|
221,897
|
|
|
|
|
|
|
|
|
|
|
|
183,856
|
|
|
|
|
|
|
|
|
|
|
Total
assets
|
|
$
|
2,221,271
|
|
|
|
|
|
|
|
|
|
|
$
|
2,180,934
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing
liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing
deposit accounts:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing
demand deposits
|
|
$
|
665,370
|
|
|
|
1,200
|
|
|
|
0.24
|
|
%
|
$
|
696,920
|
|
|
$
|
1,115
|
|
|
|
0.21
|
|
%
|
Savings
deposits
|
|
|
245,358
|
|
|
|
628
|
|
|
|
0.34
|
|
|
|
236,750
|
|
|
|
563
|
|
|
|
0.32
|
|
|
Time
deposits
|
|
|
388,894
|
|
|
|
3,210
|
|
|
|
1.10
|
|
|
|
370,851
|
|
|
|
2,627
|
|
|
|
0.94
|
|
|
Total interest-bearing
deposit accounts
|
|
|
1,299,622
|
|
|
|
5,038
|
|
|
|
0.52
|
|
|
|
1,304,521
|
|
|
|
4,305
|
|
|
|
0.44
|
|
|
Short-term
borrowings:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Repurchase agreements
with customers
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
Long-term
borrowings:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FHLBNY
advances
|
|
|
85,333
|
|
|
|
1,285
|
|
|
|
2.00
|
|
|
|
85,540
|
|
|
|
1,294
|
|
|
|
2.01
|
|
|
Obligations under
capital lease
|
|
|
6,126
|
|
|
|
317
|
|
|
|
6.88
|
|
|
|
6,541
|
|
|
|
336
|
|
|
|
6.83
|
|
|
Junior subordinated
debentures
|
|
|
81,004
|
|
|
|
2,281
|
|
|
|
3.75
|
|
|
|
92,786
|
|
|
|
1,886
|
|
|
|
2.70
|
|
|
Total
borrowings
|
|
|
172,463
|
|
|
|
3,883
|
|
|
|
2.99
|
|
|
|
184,867
|
|
|
|
3,516
|
|
|
|
2.53
|
|
|
Total
interest-bearing liabilities
|
|
|
1,472,085
|
|
|
|
8,921
|
|
|
|
0.81
|
|
|
|
1,489,388
|
|
|
|
7,821
|
|
|
|
0.70
|
|
|
Non-interest-bearing
liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-interest-bearing
demand deposits
|
|
|
409,108
|
|
|
|
|
|
|
|
|
|
|
|
404,563
|
|
|
|
|
|
|
|
|
|
|
Other
liabilities
|
|
|
14,000
|
|
|
|
|
|
|
|
|
|
|
|
24,021
|
|
|
|
|
|
|
|
|
|
|
Total
non-interest-bearing liabilities
|
|
|
423,108
|
|
|
|
|
|
|
|
|
|
|
|
428,584
|
|
|
|
|
|
|
|
|
|
|
Total
liabilities
|
|
|
1,895,193
|
|
|
|
|
|
|
|
|
|
|
|
1,917,972
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shareholders'
equity
|
|
|
326,078
|
|
|
|
|
|
|
|
|
|
|
|
262,962
|
|
|
|
|
|
|
|
|
|
|
Total liabilities and
shareholders' equity
|
|
$
|
2,221,271
|
|
|
|
|
|
|
|
|
|
|
$
|
2,180,934
|
|
|
|
|
|
|
|
|
|
|
Net interest
income
|
|
|
|
|
|
$
|
45,669
|
|
|
|
|
|
|
|
|
|
|
$
|
44,071
|
|
|
|
|
|
|
Interest rate spread
(3)
|
|
|
|
|
|
|
|
|
|
|
2.82
|
|
%
|
|
|
|
|
|
|
|
|
|
2.76
|
|
%
|
Net interest margin
(4)
|
|
|
|
|
|
|
|
|
|
|
3.04
|
|
%
|
|
|
|
|
|
|
|
|
|
2.94
|
|
%
|
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.
|
SUN BANCORP, INC. AND
SUBSIDIARIES
|
AVERAGE BALANCE
SHEETS (Unaudited)
|
(dollars in
thousands)
|
|
|
|
For the Three
Months Ended
|
|
|
For the Three
Months Ended
|
|
|
|
|
September 30,
2017
|
|
|
June 30,
2017
|
|
|
|
|
Average
|
|
|
|
|
|
|
Average
|
|
|
Average
|
|
|
|
|
|
|
Average
|
|
|
|
|
Balance
|
|
|
Interest
|
|
|
Yield/Cost
|
|
|
Balance
|
|
|
Interest
|
|
|
Yield/Cost
|
|
|
Interest-earning
assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans receivable
(1), (2)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Commercial
|
|
$
|
1,281,922
|
|
|
$
|
13,732
|
|
|
|
4.28
|
|
%
|
$
|
1,288,517
|
|
|
$
|
13,221
|
|
|
|
4.10
|
|
%
|
Home equity and
other
|
|
|
109,842
|
|
|
|
1,285
|
|
|
|
4.68
|
|
|
|
114,330
|
|
|
|
1,271
|
|
|
|
4.45
|
|
|
Residential real
estate
|
|
|
193,663
|
|
|
|
1,643
|
|
|
|
3.39
|
|
|
|
202,659
|
|
|
|
1,731
|
|
|
|
3.42
|
|
|
Total loans
receivable
|
|
|
1,585,427
|
|
|
|
16,660
|
|
|
|
4.20
|
|
|
|
1,605,506
|
|
|
|
16,223
|
|
|
|
4.04
|
|
|
Investment
securities
|
|
|
295,885
|
|
|
|
1,694
|
|
|
|
2.29
|
|
|
|
311,935
|
|
|
|
1,781
|
|
|
|
2.28
|
|
|
Interest-earning bank
balances
|
|
|
91,358
|
|
|
|
289
|
|
|
|
1.27
|
|
|
|
93,305
|
|
|
|
248
|
|
|
|
1.06
|
|
|
Total interest-earning
assets
|
|
|
1,972,670
|
|
|
|
18,643
|
|
|
|
3.78
|
|
|
|
2,010,746
|
|
|
|
18,252
|
|
|
|
3.63
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
non-interest-earning assets
|
|
|
218,918
|
|
|
|
|
|
|
|
|
|
|
|
221,231
|
|
|
|
|
|
|
|
|
|
|
Total
assets
|
|
$
|
2,191,588
|
|
|
|
|
|
|
|
|
|
|
$
|
2,231,977
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing
liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing
deposit accounts:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing
demand deposits
|
|
$
|
667,538
|
|
|
|
409
|
|
|
|
0.25
|
|
%
|
$
|
661,415
|
|
|
$
|
402
|
|
|
|
0.24
|
|
%
|
Savings
deposits
|
|
|
248,680
|
|
|
|
216
|
|
|
|
0.35
|
|
|
|
246,895
|
|
|
|
211
|
|
|
|
0.34
|
|
|
Time
deposits
|
|
|
369,883
|
|
|
|
1,033
|
|
|
|
1.12
|
|
|
|
389,869
|
|
|
|
1,081
|
|
|
|
1.11
|
|
|
Total interest-bearing
deposit accounts
|
|
|
1,286,101
|
|
|
|
1,658
|
|
|
|
0.52
|
|
|
|
1,298,179
|
|
|
|
1,694
|
|
|
|
0.52
|
|
|
Long-term
borrowings:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FHLB
advances
|
|
|
85,283
|
|
|
|
432
|
|
|
|
2.03
|
|
|
|
85,334
|
|
|
|
430
|
|
|
|
2.02
|
|
|
Obligations under
capital lease
|
|
|
6,019
|
|
|
|
105
|
|
|
|
6.98
|
|
|
|
6,127
|
|
|
|
105
|
|
|
|
6.85
|
|
|
Junior subordinated
debentures
|
|
|
57,992
|
|
|
|
413
|
|
|
|
2.85
|
|
|
|
92,616
|
|
|
|
1,161
|
|
|
|
5.01
|
|
|
Total
borrowings
|
|
|
149,294
|
|
|
|
950
|
|
|
|
2.55
|
|
|
|
184,077
|
|
|
|
1,696
|
|
|
|
3.69
|
|
|
Total
interest-bearing liabilities
|
|
|
1,435,395
|
|
|
|
2,608
|
|
|
|
0.73
|
|
|
|
1,482,256
|
|
|
|
3,390
|
|
|
|
0.91
|
|
|
Non-interest-bearing
liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-interest-bearing
demand deposits
|
|
|
414,554
|
|
|
|
|
|
|
|
|
|
|
|
409,694
|
|
|
|
|
|
|
|
|
|
|
Other
liabilities
|
|
|
12,645
|
|
|
|
|
|
|
|
|
|
|
|
14,108
|
|
|
|
|
|
|
|
|
|
|
Total
non-interest-bearing liabilities
|
|
|
427,199
|
|
|
|
|
|
|
|
|
|
|
|
423,802
|
|
|
|
|
|
|
|
|
|
|
Total
liabilities
|
|
|
1,862,594
|
|
|
|
|
|
|
|
|
|
|
|
1,906,058
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shareholders'
equity
|
|
|
328,994
|
|
|
|
|
|
|
|
|
|
|
|
325,919
|
|
|
|
|
|
|
|
|
|
|
Total liabilities and
shareholders' equity
|
|
$
|
2,191,588
|
|
|
|
|
|
|
|
|
|
|
$
|
2,231,977
|
|
|
|
|
|
|
|
|
|
|
Net interest
income
|
|
|
|
|
|
$
|
16,035
|
|
|
|
|
|
|
|
|
|
|
$
|
14,862
|
|
|
|
|
|
|
Interest rate spread
(3)
|
|
|
|
|
|
|
|
|
|
|
3.05
|
|
%
|
|
|
|
|
|
|
|
|
|
2.72
|
|
%
|
Net interest margin
(4)
|
|
|
|
|
|
|
|
|
|
|
3.25
|
|
%
|
|
|
|
|
|
|
|
|
|
2.96
|
|
%
|
Ratio of average
interest-earning assets
to
average interest-bearing liabilities
|
|
|
|
|
|
|
|
|
|
|
137
|
|
%
|
|
|
|
|
|
|
|
|
|
136
|
|
%
|
|
|
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(1)
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Average balances
include non-accrual loans.
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(2)
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Loan fees are
included in interest income and the amount is not material for this
analysis.
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(3)
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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.