Douglas H. Lowrey
Thank you, Jim. Good afternoon, everyone. The fourth quarter capped a very strong year for CapitalSource Bank. We saw a full-year top line revenue growth as interest income increased 11%, while interest expense declined by 4%. In addition, our pretax income was up 160% year-over-year.
Turning to the fourth quarter, net interest income was 3% higher than last quarter, and the net interest margin held steady at 4.95% despite our earlier expectations for a modest decline. Our loan and lease portfolio increased by $231 million or 5% on production-- funded production of $665 million. Including the loans purchased from the Parent during the fourth quarter, our portfolio growth was $343 million or 7.5% above the prior quarter end. Our credit quality was stable, and a loan loss provision of $4 million was down from $14 million in the third quarter.
We continue to reduce the level of cash and investments as we deployed excess liquidity to support loan growth, while also growing deposits by 5%. Our new and renewed time deposits were added in an average interest rate of 93 basis points, which resulted in a small decline in our overall weighted average interest rate on our deposits. We previously thought that we would have to pay up a bit to raise deposits. But our experience in the fourth quarter has caused us to lower our projections about the potential costs of raising an additional $500 million to $600 million of deposits during 2012 and its impact on our net interest margins.Read the rest of this transcript for free on seekingalpha.com
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV