Commercial Loan and Customer Growth Produce Results Ahead of Last Year; Retail Strategy Boosted by Branch Acquisition Announcement
BALA CYNWYD, PA--(Marketwired - Jul 21, 2015) - Royal Bancshares of Pennsylvania, Inc. ("Company") (
Kevin Tylus, the Company's President and Chief Executive Officer, noted, "Loan and customer growth, coupled with the continuing trend in improved credit quality, positively contributed to second quarter and 2015 year to date earnings. Portfolio growth from our leasing subsidiary also added to earnings. Our multi-faceted retail plan to attract and retain consumer deposits continued with the relocation from Jenkintown to the bustling new Willow Grove branch site. And upon regulatory approval of our entry into contiguous Delaware County, PA, the acquisition of our new branch in the county seat of Media will add approximately $38 million, or 7%, to our deposit base and $10 million, or 2%, in commercial loans."
The Company continues its focus on modernizing the ways customers can access its products and services. A new custom branded "smart phone" application is now available and provides a simpler on-line banking experience, while on-line loan applications are increasing. The suite of cash management products, together with improved physical locations and the Princeton, NJ loan production office, are helping to drive the growth within the Company's attractive geography.
Highlights for the three and six months ended June 30, 2015 included:
About Royal Bancshares of Pennsylvania, Inc.
Royal Bancshares of Pennsylvania, Inc., headquartered in Bala Cynwyd, Pennsylvania, is the parent company of Royal Bank America, which is headquartered in Narberth, Pennsylvania. Royal Bank serves growing small and middle market businesses, commercial real estate investors, consumers, and depositors principally in Montgomery, Delaware, Chester, Bucks, Philadelphia and Berks counties in Pennsylvania, central and southern New Jersey, and Delaware. Established in 1963, Royal Bank provides an array of financial products and services through a comprehensive suite of cash management services and thirteen branches and two loan production offices. More information on Royal Bancshares of Pennsylvania, Inc., Royal Bank America, and its subsidiaries can be found at www.royalbankamerica.com.
Forward-Looking Statements
The foregoing material may contain forward-looking statements. We caution that such statements may be subject to a number of uncertainties, and actual results could differ materially; therefore, readers should not place undue reliance on any forward-looking statements. Royal Bancshares of Pennsylvania, Inc. does not undertake, and specifically disclaims, any obligation to publicly release the results of any revisions that may be made to any forward-looking statements to reflect the occurrence of anticipated or unanticipated events or circumstances after the date of such statements. For a discussion of the factors that could cause actual results to differ from the results discussed in any such forward-looking statements, see the filings made by Royal Bancshares of Pennsylvania, Inc. with the Securities and Exchange Commission, including its Annual Report -- Form 10-K for the year ended December 31, 2014.
ROYAL BANCSHARES OF PENNSYLVANIA, INC. | |||||||||||||||||
CONSOLIDATED INCOME STATEMENTS | |||||||||||||||||
(Unaudited, dollars in thousands, except per share data) | |||||||||||||||||
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For the three months ended June 30, |
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For the six months ended June 30, |
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2015 | 2014 | 2015 | 2014 | ||||||||||||||
Interest income | $ | 7,071 | $ | 7,209 | $ | 14,351 | $ | 14,360 | |||||||||
Interest expense | 1,591 | 1,622 | 3,162 | 3,247 | |||||||||||||
Net Interest Income | 5,480 | 5,587 | 11,189 | 11,113 | |||||||||||||
Credit for loan and lease losses | (586 | ) | (75 | ) | (1,166 | ) | (714 | ) | |||||||||
Net interest income after credit for loan and lease losses | 6,066 | 5,662 | 12,355 | 11,827 | |||||||||||||
Non-interest income | 1,283 | 816 | 2,130 | 1,588 | |||||||||||||
Non-interest expense | 5,737 | 5,031 | 11,112 | 10,353 | |||||||||||||
Income before taxes | 1,612 | 1,447 | 3,373 | 3,062 | |||||||||||||
Income tax expense | - | - | - | - | |||||||||||||
Net Income | 1,612 | 1,447 | 3,373 | 3,062 | |||||||||||||
Less net income attributable to noncontrolling interest | 151 | 69 | 321 | 187 | |||||||||||||
Net Income Attributable to Royal Bancshares | $ | 1,461 | $ | 1,378 | $ | 3,052 | $ | 2,875 | |||||||||
Less Preferred stock Series A accumulated dividend and accretion | $ | 429 | $ | 829 | $ | 853 | $ | 1,493 | |||||||||
Net income to common shareholders | $ | 1,032 | $ | 549 | $ | 2,199 | $ | 1,382 | |||||||||
Income Per Common Share - Basic and Diluted | $ | 0.03 | $ | 0.04 | $ | 0.07 | $ | 0.10 | |||||||||
SELECTED PERFORMANCE RATIOS: | ||||||||||||||||
For the three months ended June 30, |
For the six months ended June 30, |
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2015 | 2014 | 2015 | 2014 | |||||||||||||
Return on Average Assets | 0.81 | % | 0.75 | % | 0.85 | % | 0.79 | % | ||||||||
Return on Average Equity | 9.03 | % | 10.35 | % | 9.56 | % | 11.13 | % | ||||||||
Average Equity to Average Assets | 9.00 | % | 7.22 | % | 8.89 | % | 7.07 | % | ||||||||
Book Value Per Share | $ | 1.53 | $ | 1.84 | $ | 1.53 | $ | 1.84 | ||||||||
At June 30, | At December 31, | |||||||||||||||
Capital ratios (US GAAP): | 2015 | 2014 | ||||||||||||||
Company Tier 1 Leverage | 12.5 | % | 11.9 | % | ||||||||||||
Company Total Risk Based Capital | 18.8 | % | 19.2 | % | ||||||||||||
Company Common Equity Tier 1 | 9.2 | % | NA | |||||||||||||
ROYAL BANCSHARES OF PENNSYLVANIA, INC. | ||||||||||
CONSOLIDATED BALANCE SHEETS | ||||||||||
(Unaudited, in thousands) | ||||||||||
At June 30, 2015 | At December 31, 2014 | |||||||||
Cash and cash equivalents | $ | 28,015 | $ | 30,790 | ||||||
Investment securities, at fair value | 212,022 | 250,368 | ||||||||
Other investment, at cost | 2,250 | 2,250 | ||||||||
Federal Home Loan Bank stock | 2,585 | 2,622 | ||||||||
Loans and leases | ||||||||||
Commercial real estate and multi-family | 222,311 | 188,861 | ||||||||
Construction and land development | 33,786 | 45,662 | ||||||||
Commercial and industrial | 83,825 | 76,489 | ||||||||
Residential real estate | 42,166 | 42,992 | ||||||||
Leases | 58,090 | 51,583 | ||||||||
Tax certificates | 4,804 | 7,191 | ||||||||
Consumer | 2,665 | 2,354 | ||||||||
Loans and leases | 447,647 | 415,132 | ||||||||
Allowance for loan and lease losses | (10,036 | ) | (11,708 | ) | ||||||
Loans and leases, net | 437,611 | 403,424 | ||||||||
Bank owned life insurance | 15,884 | 15,636 | ||||||||
Other real estate owned, net | 10,531 | 9,779 | ||||||||
Premises and equipment, net | 5,279 | 5,201 | ||||||||
Accrued interest receivable | 4,459 | 5,270 | ||||||||
Other assets | 8,568 | 7,213 | ||||||||
Total Assets | $ | 727,204 | $ | 732,553 | ||||||
Deposits | $ | 531,510 | $ | 530,425 | ||||||
Borrowings | 82,198 | 92,426 | ||||||||
Other liabilities | 22,435 | 21,322 | ||||||||
Subordinated debentures | 25,774 | 25,774 | ||||||||
Royal Bancshares shareholders' equity | 64,869 | 62,219 | ||||||||
Noncontrolling interest | 418 | 387 | ||||||||
Total Equity | 65,287 | 62,606 | ||||||||
Total Liabilities and Equity | $ | 727,204 | $ | 732,553 | ||||||
ROYAL BANCSHARES OF PENNSYLVANIA, INC. | ||||||||||||||||||||
NET INTEREST INCOME AND MARGIN | ||||||||||||||||||||
(Unaudited, in thousands, except percentages) | ||||||||||||||||||||
For the three months ended | For the three months ended | |||||||||||||||||||
June 30, 2015 | June 30, 2014 | |||||||||||||||||||
Average Balance | Interest | Yield | Average Balance | Interest | Yield | |||||||||||||||
Cash and cash equivalents | $ | 20,278 | $ | 8 | 0.16 | % | $ | 8,284 | $ | 5 | 0.24 | % | ||||||||
Investment securities | 223,012 | 1,340 | 2.41 | % | 312,118 | 1,954 | 2.51 | % | ||||||||||||
Loans | 431,957 | 5,723 | 5.31 | % | 370,116 | 5,250 | 5.69 | % | ||||||||||||
Total interest-earning assets | 675,247 | 7,071 | 4.20 | % | 690,518 | 7,209 | 4.19 | % | ||||||||||||
Non-interest earning assets | 46,056 | 49,365 | ||||||||||||||||||
Total average assets | $ | 721,303 | $ | 739,883 | ||||||||||||||||
Interest-bearing deposits | ||||||||||||||||||||
NOW and money markets | $ | 201,292 | $ | 168 | 0.33 | % | $ | 211,381 | $ | 166 | 0.31 | % | ||||||||
Savings | 22,268 | 10 | 0.18 | % | 18,520 | 7 | 0.15 | % | ||||||||||||
Certificates of deposit | 220,376 | 742 | 1.35 | % | 229,906 | 726 | 1.27 | % | ||||||||||||
Total interest-bearing deposits | 443,936 | 920 | 0.83 | % | 459,807 | 899 | 0.78 | % | ||||||||||||
Borrowings | 117,493 | 671 | 2.29 | % | 137,441 | 723 | 2.11 | % | ||||||||||||
Total interest-bearing liabilities | 561,429 | 1,591 | 1.14 | % | 597,248 | 1,622 | 1.09 | % | ||||||||||||
Non-interest bearing deposits | 73,831 | 64,702 | ||||||||||||||||||
Other liabilities | 21,135 | 24,517 | ||||||||||||||||||
Shareholders' equity | 64,908 | 53,416 | ||||||||||||||||||
Total average liabilities and equity | $ | 721,303 | $ | 739,883 | ||||||||||||||||
Net interest income | $ | 5,480 | $ | 5,587 | ||||||||||||||||
Net interest margin | 3.26 | % | 3.25 | % |
ROYAL BANCSHARES OF PENNSYLVANIA, INC. | ||||||||||||||||||||
NET INTEREST INCOME AND MARGIN | ||||||||||||||||||||
(Unaudited, in thousands, except percentages) | ||||||||||||||||||||
For the six months ended | For the six months ended | |||||||||||||||||||
June 30, 2015 | June 30, 2014 | |||||||||||||||||||
Average Balance | Interest | Yield | Average Balance | Interest | Yield | |||||||||||||||
Cash and cash equivalents | $ | 16,028 | $ | 13 | 0.16 | % | $ | 7,344 | $ | 10 | 0.27 | % | ||||||||
Investment securities | 236,253 | 2,916 | 2.49 | % | 315,128 | 3,876 | 2.48 | % | ||||||||||||
Loans | 425,826 | 11,422 | 5.41 | % | 368,152 | 10,474 | 5.74 | % | ||||||||||||
Total interest-earning assets | 678,107 | 14,351 | 4.27 | % | 690,624 | 14,360 | 4.19 | % | ||||||||||||
Non-interest earning assets | 45,971 | 46,014 | ||||||||||||||||||
Total average assets | $ | 724,078 | $ | 736,638 | ||||||||||||||||
Interest-bearing deposits | ||||||||||||||||||||
NOW and money markets | $ | 203,102 | $ | 326 | 0.32 | % | $ | 210,810 | $ | 333 | 0.32 | % | ||||||||
Savings | 20,788 | 18 | 0.17 | % | 18,199 | 16 | 0.18 | % | ||||||||||||
Time deposits | 222,552 | 1,484 | 1.34 | % | 233,233 | 1,463 | 1.26 | % | ||||||||||||
Total interest-bearing deposits | 446,442 | 1,828 | 0.83 | % | 462,242 | 1,812 | 0.79 | % | ||||||||||||
Borrowings | 117,823 | 1,334 | 2.28 | % | 133,863 | 1,435 | 2.16 | % | ||||||||||||
Total interest-bearing liabilities | 564,265 | 3,162 | 1.13 | % | 596,105 | 3,247 | 1.10 | % | ||||||||||||
Non-interest bearing deposits | 73,413 | 64,310 | ||||||||||||||||||
Other liabilities | 22,031 | 24,137 | ||||||||||||||||||
Shareholders' equity | 64,369 | 52,086 | ||||||||||||||||||
Total average liabilities and equity | $ | 724,078 | $ | 736,638 | ||||||||||||||||
Net interest income | $ | 11,189 | $ | 11,113 | ||||||||||||||||
Net interest margin | 3.33 | % | 3.24 | % | ||||||||||||||||
ASSET QUALITY TRENDS | ||||||||||||
(Unaudited, in thousands, except percentages) | ||||||||||||
At June 30, 2015 | At March 31, 2015 | At December 31, 2014 | ||||||||||
Non-performing loans | $ | 4,371 | $ | 7,518 | $ | 8,113 | ||||||
Non-performing tax certificates | 1,013 | 834 | 1,700 | |||||||||
Total nonperforming loans | 5,384 | 8,352 | 9,813 | |||||||||
Other real estate owned-loans | 356 | 328 | 349 | |||||||||
Other real estate owned-tax certificates | 10,175 | 10,213 | 9,430 | |||||||||
Total other real estate owned | 10,531 | 10,541 | 9,779 | |||||||||
Total nonperforming assets | $ | 15,915 | $ | 18,893 | $ | 19,592 | ||||||
Ratio of non-performing loans to total loans | 1.20 | % | 1.99 | % | 2.36 | % | ||||||
Ratio of non-performing assets to total assets | 2.19 | % | 2.61 | % | 2.67 | % | ||||||
Ratio of allowance for loan and lease losses to total loans | 2.24 | % | 2.60 | % | 2.82 | % | ||||||
Ratio of allowance for loan and lease losses to non-performing loans | 186.40 | % | 130.47 | % | 119.31 | % | ||||||
Contact Information:
Contact:
Michael S. Thompson
CFO
mthompson@royalbankamerica.com