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Provident Financial Services, Inc. Announces Increased Core Earnings And An Increase In Its Quarterly Cash Dividend Of 7.1%

Stocks in this article: PFS

ISELIN, N.J., Oct. 25, 2013 (GLOBE NEWSWIRE) -- Provident Financial Services, Inc. (NYSE:PFS) (the "Company") reported net income of $16.1 million, or $0.28 per basic and diluted share for the three months ended September 30, 2013, compared to net income of $16.2 million, or $0.28 per basic and diluted share for the three months ended September 30, 2012. For the nine months ended September 30, 2013, the Company reported net income of $53.1 million, or $0.93 per basic and diluted share, compared to net income of $50.6 million, or $0.89 per basic share and $0.88 per diluted share for the same period last year.

Earnings for the three and nine months ended September 30, 2013 were adversely impacted by the write-off of a deferred tax asset related to non-qualified stock options issued shortly after the Company's 2003 initial public offering. Those options expired unused in July 2013 and the related $3.9 million deferred tax asset was written-off via a $3.2 million charge to income tax expense and a $735,000 charge to equity. Excluding this write-off, core earnings (a non-GAAP financial measure) 1 for the three and nine months ended September 30, 2013 were $19.3 million, or $0.34 per basic and diluted share and $56.3 million, or $0.98 per basic and diluted share, respectively.  Conversely, earnings for the three and nine months ended September 30, 2013 were aided by a continued improvement in asset quality and a related reduction in the provision for loan losses compared with the same periods last year. Year-over-year growth in both average loans outstanding and average non-interest bearing demand deposits has mitigated compression in the net interest margin and the related adverse impact on net interest income. 

Christopher Martin, Chairman, President and Chief Executive Officer, commented, "Our core earnings of $0.34 per share were the culmination of strong loan originations during the quarter, complemented by continued growth in non-interest bearing deposits and a stabilizing net interest margin." Martin noted: "Our team has been successful at improving asset quality, achieving a 23% decrease in non-performing loans from September of last year, without resorting to deeply discounted bulk sales. Further, our operating discipline during the quarter produced an efficiency ratio of 55.5%. In light of our performance, I'm pleased to report that our Board of Directors has increased our quarterly dividend by over 7 percent." 

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