First Financial Holdings, Inc. Announces Third Quarter Fiscal 2011 Results and Declares Quarterly Cash Dividend

CHARLESTON, S.C., July 28, 2011 (GLOBE NEWSWIRE) -- First Financial Holdings, Inc. (Nasdaq:FFCH) ("First Financial"), the holding company for First Federal Savings and Loan Association of Charleston ("First Federal"), today announced a net loss of $(43.0) million for the third fiscal quarter or three months ended June 30, 2011, compared with $(430) thousand for the three months ended March 31, 2011 and $(12.0) million for the three months ended June 30, 2010. The net loss for the current fiscal quarter was the result of an additional provision for loan losses associated with reclassifying $155.3 million of portfolio loans to loans held for sale, as announced on July 18, 2011. After the effect of the preferred stock dividend and related accretion, First Financial reported a net loss available to common shareholders of $(44.0) million for the three months ended June 30, 2011, compared with $(1.4) million and $(13.0) million for the three months ended March 31, 2011 and June 30, 2010, respectively. Diluted net loss per common share was $(2.66) for the current quarter, compared with $(0.08) for the prior quarter and $(0.79) for the same quarter last year.

For the nine months ended June 30, 2011, First Financial recorded a net loss of $(42.3) million, compared with $(35.6) million for the same period of fiscal 2010. After the effect of the preferred stock dividend and related accretion, the net loss available to common shareholders was $(45.1) million for the nine months ended June 30, 2011, compared with $(38.5) million for the same period of fiscal 2010. Diluted net loss per common share was $(2.73) compared with $(2.33) for the same period of fiscal 2010.

"Strategically, this has been a productive quarter for First Financial. We completed the sale of our insurance agency subsidiary, entered into an agreement to acquire branches in Hilton Head, and are pursuing the sale of certain nonperforming and performing loans," commented R. Wayne Hall, president and chief executive officer of First Financial and First Federal. "We believe these actions strengthen our company by positioning us to focus on core banking business lines and will ultimately increase returns to our shareholders and enhance the value of our franchise. Specifically, the upcoming sale of the selected loan pool will result in a substantial reduction to our nonperforming assets and will position us for a return to core operating earnings."

Discontinued Operations

As a result of First Financial's sale of its insurance agency subsidiary, First Southeast Insurance Services, Inc. ("First Southeast"), which was completed on June 1, 2011, the financial condition and operating results for this subsidiary have been segregated from the financial condition and operating results of First Financial's continuing operations throughout this release and, as such, are presented as a discontinued operation. While all prior periods have been revised retrospectively to align with this treatment, these changes do not affect First Financial's reported consolidated financial condition or net income for any of the prior periods.

Third Quarter Fiscal 2011 Highlights

• First Financial completed the sale of First Southeast to Hub International, LLC on June 1, 2011 for a cash purchase price of $38.0 million and recorded a $6.5 million pre-tax gain on the sale (excluding transaction related costs).
   
• On June 22, 2011, First Financial announced it signed a purchase and assumption agreement with Liberty Savings Bank, FSB ("Liberty") to acquire the deposits and select loans associated with Liberty's five bank branches in Hilton Head, South Carolina. Based on information available at signing, First Financial expects to acquire approximately $110 million in deposits and $27 million in loans. The transaction is subject to regulatory approval and is expected to close in the fourth calendar quarter.
   
• Effective June 30, 2011, First Financial reclassified $155.3 million of certain nonperforming and performing loans to loans held for sale. First Financial is pursuing potential sale alternatives that are expected to result in the disposition of these assets prior to the calendar year end. As a result of the reclassification, First Financial recorded the following:

• Charged-off $95.0 million against the allowance for loan losses to record the loans at estimated fair value, less transaction costs;
• Recorded a net incremental provision for loan losses of $65.7 million;
• Reduced delinquent loans at June 30, 2011 by $6.3 million;
• Reduced nonperforming loans at June 30, 2011 by $111.0 million; and
• Transferred $60.3 million to loans held for sale at estimated fair value.

Balance Sheet

Total assets at June 30, 2011 were $3.2 billion, a decrease of $80.5 million or 2.4% from March 31, 2011 and a decrease of $102.8 million or 3.1% from June 30, 2010. The decline from March 31, 2011 was primarily the result of a decrease in the loan portfolio and the sale of First Southeast, partially offset by increases in investment securities, loans held for sale, and other assets. The decline from June 30, 2010 was primarily the result of a decrease in the loan portfolio and the sale of First Southeast, partially offset by an increase in loans held for sale and other assets. The decline in the loan portfolio from both prior periods was primarily the result of the above mentioned loan reclassification to loans held for sale. 

Investment securities at June 30, 2011 were $478.6 million, an increase of $32.1 million or 7.2% over March 31, 2011 and essentially unchanged from June 30, 2010. The increase over the prior quarter was primarily the result of purchasing new investment securities, partially offset by normal cash flows and prepayments received during the quarter. 

The following table summarizes the loan portfolio by major categories.

Total loans at June 30, 2011 decreased $187.8 million or 7.3% from March 31, 2011 and decreased $218.8 million or 8.4% from June 30, 2010. The decreases were primarily the result of reclassifying $155.3 million in certain nonperforming and performing loans to loans held for sale as of June 30, 2011. In addition to the loan reclassification, the loan portfolio declined due to lower loan demand from creditworthy borrowers, charge-offs, and transfers of nonperforming loans to other real estate owned ("OREO"), as well as paydowns due to normal borrower activity.  

The allowance for loan losses totaled $55.5 million or 2.34% of total loans at June 30, 2011, compared with $85.1 million or 3.33% of total loans at March 31, 2011 and $86.9 million or 3.36% of total loans at June 30, 2010. The decreases were primarily the result of the above mentioned loan reclassification and improvement in credit quality measures. As loans held for sale are measured at fair value and further deterioration will be recorded through noninterest income, they are no longer included in the calculation of the allowance for loan losses. Based on the reclassification and lower inherent risk in the remaining loan portfolio, $29.3 million of specific and allocated general reserves were released from the allowance for loan losses.

The following table summarizes the loans transferred to loans held for sale as of June 30, 2011.

At June 30, 2011, loans held for sale was comprised of $24.0 million in residential mortgage loans awaiting sale in the secondary market and $60.3 million of certain nonperforming and performing loans identified to be sold. Loans held for sale at June 30, 2011 increased $64.8 million over March 31, 2011 and increased $69.3 million over June 30, 2010. The increases were primarily the result of the above mentioned loan reclassification, which transferred the loans at estimated fair value, less transaction costs. First Financial is pursuing potential sale alternatives that are expected to result in the disposition of these assets prior to the calendar year end. The residential mortgage loans to be sold in the secondary market generally settle in 45 to 60 days. 

Other assets totaled $130.9 million at June 30, 2011, an increase of $20.5 million or 18.5% over March 31, 2011 and an increase of $60.4 million or 85.7% over June 30, 2010. The increases were primarily the result of higher current tax assets associated with the loss recorded in the current fiscal quarter. In addition, the increase over June 30, 2010 was attributed to additional OREO properties acquired during the past twelve months.

Core deposits, which include checking, savings, and money market accounts, totaled $1.2 billion at June 30, 2011, essentially unchanged from March 31, 2011 and an increase of $66.0 million or 5.9% over June 30, 2010. The increase was primarily the result of several marketing initiatives and campaigns during the last twelve months to attract and retain core deposits.  Time deposits at June 30, 2011 totaled $1.1 billion, a decrease $34.7 million or 3.0% from March 31, 2011 and a decrease of $213.9 million or 15.8% from June 30, 2010. The decreases were primarily the result of a planned reduction in maturing high rate retail and wholesale time deposits. 

Advances from the FHLB at June 30, 2011 totaled $557.5 million, essentially unchanged from March 31, 2011 and an increase of $79.1 million or 16.5% over June 30, 2010. The increase was primarily the result of a shift in funding mix due to the planned reduction of high rate time deposits, partially offset by using cash flow from investment securities and the loan portfolio to paydown FHLB advances. 

Shareholders' equity at June 30, 2011 totaled $266.6 million, a decrease of $45.0 million or 14.4% from March 31, 2011 and a decrease of $57.2 million or 17.7% from June 30, 2010. The decreases were primarily the result of net losses incurred during the last fiscal year. While First Financial is not currently required to report risk-based capital metrics at the holding company level, using June 30, 2011 data on a pro-forma basis, Tier 1 capital for the holding company is projected at $308.4 million and total risk-based capital is projected at 14.78%. First Federal's regulatory capital ratios continue to be above "well-capitalized" minimums, as evidenced by the key capital ratios and additional capital information presented in the following table.

Effective July 28, 2011, First Financial downstreamed capital of $20 million to First Federal. As a result of this action, the pro forma total risk-based capital ratio for First Federal at June 30, 2011 is 12.18%.

Asset Quality

First Federal's loan portfolio is affected by numerous factors, including the economic environment in the markets it serves. First Federal carefully monitors its loans in an effort to identify and mitigate any potential credit quality issues and losses in a proactive manner. The following table summarizes the effect of the loan reclassification on the credit metrics at and for the quarter ended June 30, 2011 and demonstrates that First Federal realized improvements in all credit quality metrics prior to the loan reclassification.

The following tables highlight several of the significant qualitative aspects of the loan portfolio to illustrate the overall level of quality and risk inherent in the portfolio.

Total delinquent loans at June 30, 2011 decreased $12.5 million or 47.0% from the prior quarter. The decline was primarily the result of $6.3 million that transferred to loans held for sale as a result of the above mentioned loan reclassification, with the remaining net reduction related to ongoing focused collection efforts. 

Total delinquent loans at June 30, 2011 also included $3.0 million in loans covered under a purchase and assumption loss-share agreement with the FDIC, as compared with $3.2 million at March 31, 2011. 

Total nonperforming loans at June 30, 2011 decreased $113.7 million or 72.8% from March 31, 2011. The decline was primarily the result of $111.0 million of nonperforming loans that transferred to loans held for sale as a result of the above mentioned loan reclassification. Nonperforming assets at June 30, 2011 included $16.9 million in nonperforming loans and $7.3 million in OREO covered under a purchase and assumption loss-share agreement with the FDIC, as compared with $16.2 million in nonperforming loans and $6.1 million in OREO at March 31, 2011.

The increase in net charge-offs for the quarter ended June 30, 2011 over the prior quarter was primarily the result of $95.0 million in gross charge-offs due to the above mentioned loan reclassification. Net charge-offs as a result of First Federal's normal credit monitoring practices totaled $12.4 million for the current fiscal quarter with no individual large loans charged-off.

The following table details classified assets by category as well as reserves allocated to classified loans.

Quarterly Results of Operations

First Financial reported a net loss from continuing operations of $(42.3) million for the three months ended June 30, 2011, compared with $(1.3) million for the three months ended March 31, 2011 and $(12.5) million for the three months ended June 30, 2010. Total revenue, which consists of net interest income and noninterest income, totaled $48.6 million for the three months ended June 30, 2011, compared with $41.5 million for the three months ended March 31, 2011 and $44.7 million for the three months ended June 30, 2010. Pre-tax, pre-provision earnings from continuing operations increased to $16.1 million for the quarter ended June 30, 2011, compared with $10.4 million and $16.0 million for the quarters ended March 31, 2011 and June 30, 2010, respectively. The increase over the prior quarter was primarily the result of the gain on the sale of First Southeast. While the pre-tax pre-provision earnings from continuing operations were essentially unchanged from the same quarter last year, the gain on the sale of First Southeast substantially offset a decline in net interest income and an increase in noninterest expense, as discussed below. The loss from discontinued operations was $(701) thousand for the three months ended June 30, 2011, compared with net income from discontinued operations of $917 thousand for the three months ended March 31, 2011 and $506 thousand for the three months ended June 30, 2010.  The current quarter loss included sale-related settlement adjustments and severance payments to certain employees. The changes in the key components of net income are discussed below. 

Net interest income

Net interest margin, on a fully tax-equivalent basis, was 3.83% for the quarter ended June 30, 2011, unchanged from the quarter ended March 31, 2011 and a decline from 3.95% for the quarter ended June 30, 2010. The decline was primarily the result of the reduction in the yield on earning assets exceeding the decline in cost of interest-bearing liabilities. First Financial continues to reprice deposits as market competition will support, and earning assets continue to reprice and be replaced with lower yielding assets due to the current low interest rate environment.

Net interest income for the quarter ended June 30, 2011 was $29.4 million, essentially unchanged from the prior quarter and a decrease of $1.8 million or 5.8% from the same quarter last year. The decrease was primarily the result of a decline in average earning assets due to lower loan demand from creditworthy borrowers and loan charge-offs, as well as using cash flow from investment securities to fund maturing deposits or paydown borrowings rather than being fully reinvested. 

Provision for loan losses

After determining what First Financial believes is an adequate allowance for loan losses based on the estimated risk inherent in the loan portfolio, the provision for loan losses is calculated based on the net effect of the change in the allowance for loan losses and net charge-offs. The provision for loan losses was $77.8 million for the quarter ended June 30, 2011, compared with $12.7 million for the linked quarter and $36.4 million for the same quarter last year. The increases were primarily the result of $65.7 million in additional provision related to the above mentioned loan reclassification, which was the net result of the incremental charge-offs and reserve release. Excluding the effects of the loan reclassification, the provision for loan losses during the third quarter of 2011 would have been $12.1 million.

Noninterest income

Noninterest income totaled $19.2 million for the quarter ended June 30, 2011, an increase of $7.0 million or 57.0% over the prior quarter and an increase of $5.7 million or 42.3% over the same quarter last year. The increase over the prior quarter was primarily the result of a $6.5 million gain on the sale of First Southeast (excluding transaction-related costs), which was completed on June 1, 2011. Additionally, the increase over the linked quarter was the result of higher mortgage and other loan income ($928 thousand) primarily the result of improved spreads on underlying hedges, and higher service charges on deposit accounts ($601 thousand) due to higher transaction-related revenue. These increases were partially offset by lower net security gains ($1.4 million) as the prior quarter included a $1.4 million gain on the sale of one security.

The increase over the same quarter last year was primarily the result of the above mentioned $6.5 million gain, partially offset by a decrease in mortgage and other loan income ($424 thousand) due to a decline in the volume of loans sold during the current quarter and a decrease in other income ($1.3 million) due to the receipt of $1.5 million from the FDIC in April 2010 as a final settlement in connection with the 2009 purchase of Cape Fear. 

Noninterest expense

Noninterest expense totaled $32.5 million for the quarter ended June 30, 2011, an increase of $1.4 million or 4.6% over the linked quarter and an increase of $3.8 million or 13.3% over the same quarter last year. The increase over the linked quarter was primarily the result of a $2.5 million goodwill impairment charge recorded in the current quarter related to First Financial's remaining insurance operations. Additionally, other increases over the linked quarter were recorded in OREO expenses, net ($933 thousand) and professional services ($332 thousand), partially offset by lower salaries and employee benefits ($1.5 million) and FDIC insurance and regulatory fees ($634 thousand). The increase in OREO expenses was primarily the result of a $1.3 million reduction in the second fiscal quarter due to OREO valuation loss claims and recoverable expenses on foreclosed properties from the former Cape Fear Bank that were eligible for reimbursement from the FDIC through the loss share agreement, partially offset by lower fair value writedowns on the properties. The increase in professional services was primarily the result of the fee paid to the advisors of the First Southeast sale. The decrease in salaries and employee benefits was primarily the result of $1.8 million in compensation agreements entered into during the second fiscal quarter. The decrease in FDIC insurance and regulatory fees was primarily the result of the new assessment methodology, which was announced in February 2011. 

The increase over the same quarter last year was primarily the result of the above mentioned goodwill impairment charge ($2.5 million), higher salaries and employee benefits ($933 thousand) and other loan expense ($646 thousand), partially offset by a general decline in most other noninterest expense categories. Salaries and employee benefits increased over the same quarter last year due to new positions added during 2010 in wealth management, correspondent lending, mortgage originations, operations and administrative areas. The increase in other loan expense was primarily the result of foreclosure-related expenses. 

Year-to-Date Results of Operations

First Financial recorded a net loss from continuing operations of $(42.6) million for the nine months ended June 30, 2011, compared with $(37.7) million for the same period of fiscal 2010. Income from discontinued operations was $354 thousand for the nine months ended June 30, 2011, compared with $2.1 million for the nine months ended June 30, 2010. The decline from the prior fiscal year was primarily the result of sale-related settlement adjustments and severance payments to certain employees in the third quarter of fiscal 2011.

For the nine months ended June 30, 2011, net interest margin was 3.83%, compared with 3.96% for the same period of fiscal 2010. Net interest income totaled $89.0 million for the nine months ended June 30, 2011, a decrease of $6.6 million or 6.9% from the same period of fiscal 2010. The decrease was primarily the result of lower net interest margin and a $124.5 million decrease in average earning assets. The decrease in average earning assets was primarily the result of a decline in loan balances due to lower loan demand from creditworthy borrowers and loan charge-offs, as well as using cash flow from investment securities to fund maturing deposits or paydown borrowings rather than being fully reinvested. 

The provision for loan losses totaled $101.0 million for the nine months ended June 30, 2011, compared with $107.6 million for the same period of fiscal 2010. The decrease was primarily the result of lower net charge-offs and some stabilization in the level of classified loans during the current fiscal year, partially offset by $65.7 million in additional provision related to the above mentioned loan reclassification.

Noninterest income totaled $42.7 million for the nine months ended June 30, 2011, compared with $35.6 million for the same period of fiscal 2010.  The increase was primarily the result of the above mentioned gain on the sale of First Southeast ($6.5 million) and higher net securities gains ($3.3 million), partially offset by lower other income ($2.7 million) as well as lower mortgage and other loan income ($1.2 million). The increase in net securities gains was primarily the result of a $1.4 million gain on the sale of one security in the second fiscal quarter of 2011 and lower OTTI charges on investment securities in the current fiscal year. The decrease in other income was primarily the result of the above mentioned $1.5 million settlement with the FDIC in the third fiscal quarter of 2010 and a $1.2 million gain on the donation of a branch location recorded during the first fiscal quarter of 2010. The decrease in mortgage and other loan income was primarily the result of a decline in the volume of loans sold in the current fiscal year and the reversal of late fees related to nonperforming and charged-off loans.

Noninterest expense totaled $93.1 million for the nine months ended June 30, 2011, an increase of $7.2 million or 8.4% over the same period of fiscal 2010. The increase was primarily the result of the goodwill impairment charge ($2.5 million), higher salaries and employee benefits ($5.0 million), other loan expense ($1.5 million), and professional services ($1.5 million), partially offset by lower OREO expenses ($2.3 million) and other expense ($1.1 million). The decrease in other expense was primarily the result of a $1.2 million contribution in conjunction with the donation of a branch location recorded during the first fiscal quarter of 2010. The variances in the other categories were the result of substantially the same factors discussed above in the quarterly results analysis. 

Cash Dividend Declared

On July 28, 2011, First Financial's Board of Directors declared a quarterly cash dividend of $0.05 per share. The dividend is payable on August 26, 2011 to shareholders of record as of August 12, 2011.

Conference Call

R. Wayne Hall, president and CEO; Blaise B. Bettendorf, EVP and CFO; and Joseph W. Amy, EVP and CCO; will review the quarter's results in a conference call at 10:00 am (ET), July 29, 2011. The live audio webcast is available on First Financial's website at www.firstfinancialholdings.com and will be available for 90 days.

About First Financial

First Financial Holdings, Inc. ("First Financial", (Nasdaq:FFCH) is a Charleston, South Carolina financial services provider with $3.2 billion in total assets as of June 30, 2011. First Financial offers integrated financial solutions, including personal, business, wealth management, and insurance. First Federal Savings and Loan Association ("First Federal"), which was founded in 1934 and is the primary subsidiary, serves individuals and businesses throughout coastal South Carolina, as well as the Florence, Columbia, and upstate regions of South Carolina and Wilmington, North Carolina.  First Financial subsidiaries include: First Federal; Kimbrell Insurance Group, Inc., a managing general insurance agency; First Southeast 401(k) Fiduciaries, Inc., a registered investment advisor; and First Southeast Investor Services, Inc., a registered broker-dealer. First Federal is the largest financial institution headquartered in the Charleston, South Carolina metropolitan area and the third largest financial institution headquartered in South Carolina, based on asset size. Additional information about First Financial is available at www.firstfinancialholdings.com.

Non-GAAP Financial Information

In addition to results presented in accordance with U.S. generally accepted accounting principles ("GAAP"), this press release includes non-GAAP financial measures such as the efficiency ratio, the tangible common equity to tangible assets ratio, tangible common book value per share, and pre-tax pre-provision earnings. First Financial believes these non-GAAP financial measures provide additional information that is useful to investors in understanding its underlying performance, business, and performance trends and such measures help facilitate performance comparisons with others in the banking industry. Non-GAAP measures have inherent limitations, are not required to be uniformly applied, and are not audited. Readers should be aware of these limitations and should be cautious to their use of such measures. To mitigate these limitations, First Financial has procedures in place to ensure that these measures are calculated using the appropriate GAAP or regulatory components in their entirety and to ensure that its performance is properly reflected to facilitate consistent period-to-period comparisons. Although management believes the above non-GAAP financial measures enhance investors' understanding of First Financial's business and performance, these non-GAAP measures should not be considered in isolation, or as a substitute for GAAP basis financial measures. 

In accordance with industry standards, certain designated net interest income amounts are presented on a taxable equivalent basis, including the calculation used in the efficiency ratio. 

First Financial believes the exclusion of goodwill and other intangible assets facilitates the comparison of results for ongoing business operations. The tangible common equity ("TCE") ratio and tangible common book value per share ("TBV") have become a focus of some investors, analysts and banking regulators. Management believes these measures may assist in analyzing First Financial's capital position absent the effects of intangible assets and preferred stock. Because TCE and TBV are not formally defined by GAAP or codified in the federal banking regulations, these measures are considered to be non-GAAP financial measures. However, analysts and banking regulators may assess First Financial's capital adequacy using TCE or TBV, therefore, management believes that it is useful to provide investors the ability to assess its capital adequacy on the same basis. 

First Financial believes that pre-tax, pre-provision earnings are a useful measure in assessing its core operating performance, particularly during times of economic stress. This measurement, as defined by management, represents total revenue (net interest income plus noninterest income) less noninterest expense. As recent results for the banking industry demonstrate, credit writedowns, loan charge-offs, and related provisions for loan losses can vary significantly from period to period, making a measure that helps isolate the impact of credit costs on profitability important to investors. 

Refer to the Selected Financial Information table and the Non-GAAP Reconciliation table later in this release for additional information.

Forward-Looking Statements 

Statements in this release that are not statements of historical fact, including without limitation, statements that include terms such as "believes," "expects," "anticipates," "estimates," "forecasts," "intends," "plans," "targets," "potentially," "probably," "projects," "outlook," or similar expressions or future conditional verbs such as "may," "will," "should," "would," or "could" constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements regarding First Financial's future financial and operating results, plans, objectives, expectations and intentions involve risks and uncertainties, many of which are beyond First Financial's control or are subject to change. No forward-looking statement is a guarantee of future performance and actual results could differ materially. Factors that could cause or contribute to such differences include, but are not limited to, the general business environment, general economic conditions nationally and in the States of North and South Carolina, interest rates, the North and South Carolina real estate markets, the demand for mortgage loans, the credit risk of lending activities, including changes in the level and trend of delinquent and nonperforming loans and charge-offs, changes in First Federal's allowance for loan losses and provision for loan losses that may be affected by deterioration in the housing and real estate markets; results of examinations by banking regulators, including the possibility that any such regulatory authority may, among other things, require First Federal to increase its allowance for loan losses, writedown assets, change First Federal's regulatory capital position or affect its ability to borrow funds or maintain or increase deposits, which could adversely affect liquidity and earnings; First Financial's ability to control operating costs and expenses, First Financial's ability to successfully integrate any assets, liabilities, customers, systems, and management personnel acquired or may in the future acquire into its operations and its ability to realize related revenue synergies and cost savings within expected time frames and any goodwill charges related thereto, competitive conditions between banks and non-bank financial services providers, and regulatory changes including the Dodd-Frank Wall Street Reform and Consumer Protection Act. Other risks are also detailed in First Financial's Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and current reports on Form 8-K filings with the Securities and Exchange Commission ("SEC"), which are available at the SEC's website www.sec.gov. Other factors not currently anticipated may also materially and adversely affect First Financial's results of operations, financial position, and cash flows. There can be no assurance that future results will meet expectations. While First Financial believes that the forward-looking statements in this release are reasonable, the reader should not place undue reliance on any forward-looking statement. In addition, these statements speak only as of the date made. First Financial does not undertake, and expressly disclaims any obligation to update or alter any statements, whether as a result of new information, future events or otherwise, except as required by applicable law.