EverBank Financial Corp. Announces Second Quarter 2013 Financial Results

EverBank Financial Corp. (NYSE:EVER) announced today its financial results for the second quarter ended June 30, 2013.

GAAP diluted earnings per share was $0.35, a 17% increase from $0.30 in the first quarter 2013 and a 289% increase from $0.09 in the second quarter 2012. Adjusted diluted earnings per share was $0.28, a 15% decrease from $0.33 in the first quarter 2013 and a 15% decrease from $0.33 in the second quarter 2012. 1

“EverBank's results for the second quarter highlight the power of our banking franchise as we achieved quarterly portfolio loan growth of 5% and a return on equity of 12.7%," said Robert M. Clements, Chairman and Chief Executive Officer. "The second quarter saw a meaningful rise in interest rates and we look forward to benefiting from this transition given the composition of our balance sheet and flexibility of our business model. We remain confident in our ability to generate earnings growth and attractive risk-adjusted returns over the long term."

Second Quarter 2013 Key Highlights
  • Return on equity ("ROE") was 12.7% and adjusted ROE was 10.2%.
  • Net income of $46 million, an increase of 17% compared to the prior quarter and an increase of 312% compared to the second quarter of 2012.
  • Adjusted net income of $37 million, a decrease of 15% compared to the prior quarter and an increase of 2% compared to the second quarter of 2012.
  • Revenue of $288 million, an increase of 4% compared to the prior quarter and an increase of 45% compared to the second quarter of 2012.
  • Total organic asset generation of $3.8 billion, an increase of 15% compared to the prior quarter and an increase of 39% compared to the second quarter of 2012.
  • Total loans and leases held for investment were $12.9 billion, an increase of 5% compared to the prior quarter.
  • Annualized net charge-offs to average loans and leases held for investment were 0.12% for the quarter.
  • Tangible common equity per common share was $11.00 at June 30, 2013, an increase of 3% compared to the prior quarter and an increase of 10% compared to the second quarter 2012.
  • Our board of directors approved a 50% increase in the quarterly common stock dividend to $0.03 per share.

"EverBank is benefiting from its strategic expansion into commercial and retail lending, with second quarter commercial lending and leasing loan growth of 5% and retail lending origination growth of 45% compared to the prior quarter," said W. Blake Wilson, President and Chief Operating Officer. "As the market transitions, we are keenly focused on optimizing efficiency at the business unit level. In addition, having completed our significant infrastructure investments, we anticipate achieving meaningful operating leverage across the organization."
   
1 A reconciliation of Non-GAAP financial measures can be found in the financial tables attached hereto.

Balance Sheet

Diversified Loan Growth

Total portfolio loans held for investment were $12.9 billion at June 30, 2013, an increase of $0.6 billion, or 5%, from the prior quarter. Year over year, this represents a $5.1 billion, or 65%, increase. Loans held for investment for the second quarter 2013 were comprised of:
($ in millions)  

June 30,

2013
 

March 31,

2013
 

June 30,

2012
Residential mortgages $ 6,586 $ 6,280 $ 5,061
Commercial & commercial real estate 3,798 3,722 1,320
Warehouse finance 1,292 1,161 527
Lease financing receivables 1,015 911 681
Other 176   181   196
Total HFI $ 12,867   $ 12,255   $ 7,785

During the second quarter, residential loans HFI increased by 5% compared to the prior quarter to $6.6 billion as we experienced significant growth in our prime jumbo hybrid ARM portfolio. Based on the current rate environment, we expect to continue to originate prime jumbo loans for our balance sheet and will selectively evaluate capital market executions. This strategy is consistent with our approach of retaining high quality loans with attractive risk-adjusted returns for our portfolio.Our commercial lending and leasing platforms experienced strong growth in the quarter and represent approximately 47% of loans HFI in the second quarter compared to approximately 32% a year ago. Our focus on high quality commercial lending and leasing assets positions us to benefit from higher interest rate levels.

Loan Origination Activities

Organic asset generation totaled $3.8 billion and retained organic production totaled $1.1 billion for the second quarter of 2013, an increase of 15% and 111%, respectively, from the prior quarter. Total commercial loans and leases originated during the quarter were $0.5 billion, including commercial real estate originations of $0.2 billion. This represents an increase of 31% and 149%, respectively, compared to the prior quarter.

Residential loan originations were $3.2 billion for the second quarter, an increase of 12% compared to the prior quarter. Origination volume from our retail channel was $1.2 billion in the second quarter, an increase of 45% from the prior quarter and a 293% increase year over year. Purchase transactions represented 32% of total volumes and 49% of retail volumes, compared to 19% and 32%, respectively, in the prior quarter. We originated record prime jumbo loan volume of $1.1 billion during the second quarter, an increase of 36% over the prior quarter, including hybrid ARM volume of $0.5 billion and fixed-rate volume of $0.6 billion.

Subsequent to the end of the quarter, we executed a sale of our fixed-rate prime jumbo loans classified as held for sale at June 30, 2013. The transaction is expected to close in the third quarter, subject to customary closing conditions.

Deposit Growth

Total deposits were $13.7 billion at June 30, 2013, flat quarter over quarter, as increased transaction, savings and money market balances were offset by lower time deposit balances. Year over year, total deposits grew by $2.9 billion, or 27%, from $10.8 billion. At June 30, 2013, our deposits were comprised of the following:
($ in millions)  

June 30,

2013
 

March 31,

2013
 

June 30,

2012
Noninterest-bearing demand $ 1,205 $ 1,287 $ 1,357
Interest-bearing demand 3,082 2,933 2,159
Savings and money market accounts 5,153 4,902 3,960
Global market-based accounts 1,051 1,136 1,266
Time, excluding market-based 3,179     3,416     2,062
Total deposits $ 13,670     $ 13,674     $ 10,804

Total other borrowings were $2.7 billion at June 30, 2013, a decrease of 1% quarter over quarter. We expect to continue to replace a portion of our wholesale borrowings with core deposits over time.

Capital Strength

Total shareholders' equity was $1.5 billion at June 30, 2013, an increase of 3% quarter over quarter. The bank’s Tier 1 leverage ratio was 8.3% and total risk-based capital ratio was 13.7% at June 30, 2013. As a result, the bank is considered "well-capitalized" under all applicable regulatory guidelines.

The final Basel III rules increased our estimate of the fully phased-in common equity tier 1 capital ratio from 8.5% - 9.0% to 9.0% - 9.5%.

Credit Quality

Our adjusted non-performing assets were 0.92% of total assets at June 30, 2013, a decrease from 0.99% for the prior quarter and 1.46% at June 30, 2012. Net charge-offs during the second quarter of 2013 were $4 million, a decrease of $3 million, or 48%, compared to the first quarter of 2013, driven by a $3 million increase in recoveries. On an annualized basis, net charge-offs were 0.12% of total average loans and leases held for investment, compared to 0.23% for the prior quarter and 0.34% for the second quarter of 2012.

Originated Loan Repurchase Activity

During the second quarter of 2013, we experienced net realized losses on loan repurchases of $2.7 million and recorded a net recovery of provision of $0.2 million on repurchase obligations for loans sold or securitized. Our reserve declined from $25 million in the first quarter of 2013 to $22 million in the second quarter of 2013. We continue to be well reserved with approximately 5 quarters of coverage based on the average quarterly loss rate over the trailing four quarters. We believe that our 0.10% total loss rate is indicative of our disciplined underwriting guidelines and risk management culture.

Income Statement Highlights

Continued Revenue Growth

Revenue for the second quarter of 2013 was $288 million, an increase of $11 million, or 4%, from $277 million in the first quarter 2013. The increase from the prior quarter was due to strong non-interest income driven by the positive contribution from net loan servicing income and loan production revenue, offset by lower gain on sale of loans income and other fee income.

Net Interest Income

For the second quarter of 2013, net interest income was $141 million, a $3 million, or 2%, decrease compared to the prior quarter. This decrease was attributed to lower investment securities average balances and yields, lower loans and leases HFI average balances and yields, lower lease financing receivables yields and higher yields in our wholesale borrowings. Offsetting these were a decline in deposit interest cost driven by lower deposit pricing beginning in June and an increase in loans HFS average balances and yields.Core net interest margin, which is net interest margin excluding the impact of Tygris excess accretion, decreased to 3.21% for the second quarter of 2013 from 3.27% in the first quarter of 2013.

Noninterest Income

Noninterest income for the second quarter of 2013 was $147 million, an increase of $13 million, or 10%, compared to the prior quarter. This increase was driven by a $24 million improvement in net loan servicing income, offset by a $6 million decline in gain on sale of loans income and a $3 million decrease in other income. Our gain on sale margin decreased by 87 basis points during the quarter to 2.16%, primarily driven by changes in interest rates and related mortgage spread widening that occurred at the end of the quarter.

Noninterest Expense

Noninterest expense for the second quarter of 2013 increased by $2 million, or 1%, to $214 million from $212 million in the prior quarter. Adjusted for foreclosure review costs of $18 million, noninterest expense was $196 million in the quarter, a decrease of 2% compared to $200 million in the first quarter. We expect that the initial file review of the independent foreclosure review pursuant to the consent order will be completed by early to mid August. General and administrative expense, excluding credit-related expenses, decreased $9 million, or 14%, from the first quarter due to a decline in FDIC assessment and agency fees as well as lower advertising and marketing expenses. Salaries, commissions and employee benefits increased by $8 million, or 7%, due to continued hiring activity to support our retail mortgage lending expansion as well as increased staffing in our servicing operation related to onboarding the $13 billion unpaid principal balance Fannie Mae acquisition completed in the second quarter.

Income Tax Expense

Our effective tax rate for the first and second quarter of 2013 was 38%, compared to 36% for the second quarter 2012.

Segment Analysis for the Second Quarter of 2013
  • Banking and Wealth Management pre-tax income was $89 million, a 17% increase compared to the prior quarter.
  • Mortgage Banking pre-tax income was $10 million, a 23% decrease compared to the prior quarter.
  • Corporate Services had a pre-tax loss of $25 million, a 6% improvement compared to the pre-tax loss in the prior quarter driven by lower noninterest expense.

Dividends

On July 23, 2013, the Company's Board of Directors declared a quarterly cash dividend of $0.03 per common share, payable on August 23, 2013, to stockholders of record as of August 12, 2013. This represents an increase of 50% from the prior quarter's cash dividend. Also on July 23, 2013, the Company's Board of Directors declared a quarterly cash dividend of $421.875, payable on October 5, 2013, for each share of 6.75% Series A Non-Cumulative Perpetual Preferred Stock held as of September 20, 2013.

Subsequent Event

Subsequent to the quarter end, EverBank announced it will cease originating residential mortgages through its wholesale broker lending channel while continuing to focus on growing its retail, consumer direct and correspondent lending channels. Origination volume attributable to the wholesale broker channel was $0.5 billion in the second quarter and $1.2 billion year-to-date. These actions will eliminate approximately 150 positions nationwide and result in a one-time after-tax charge of $2.0 to $4.0 million which will be incurred in the third quarter of 2013.

Conference Call and Webcast

The Company will host a conference call at 8:00 a.m. Eastern Time on Tuesday, July 30, 2013 to discuss its second quarter 2013 results. The dial-in number for the conference call is 1-866-652-5200 and the international dial-in number is 1-412-317-6060, passcode is 10031015. A live webcast of the conference call will also be available on the investor relations page of the Company's website at www.abouteverbank.com/ir.

About EverBank Financial Corp.

EverBank Financial Corp., through its wholly-owned subsidiary EverBank, provides a diverse range of financial products and services directly to clients nationwide through multiple business channels. Headquartered in Jacksonville, Florida, EverBank has $18.4 billion in assets and $13.7 billion in deposits as of June 30, 2013. With an emphasis on value, innovation and service, EverBank offers a broad selection of banking, lending and investing products to consumers and businesses nationwide. EverBank provides services to clients through the internet, over the phone, through the mail, at its Florida-based financial centers and at other business offices throughout the country. More information on EverBank can be found at www.abouteverbank.com/ir.

Forward-Looking Statements

This news release contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and such statements are intended to be covered by the safe harbor provided by the same. These statements may address issues that involve significant risks, uncertainties, estimates and assumptions made by management. Words such as “outlook,” “believes,” “expects,” “potential,” “continues,” “may,” “will,” “could,” “should,” “seeks,” “approximately,” “predicts,” “intends,” “plans,” “estimates,” “anticipates” or the negative version of those words or other comparable words are intended to identify forward-looking statements but are not the exclusive means of identifying such statements. These forward-looking statements are not historical facts, and are based on current expectations, estimates and projections about the Company’s asset growth and earnings, industry, management’s beliefs and certain assumptions made by management, many of which, by their nature, are inherently uncertain and beyond the Company’s control. Factors that could cause actual results to differ from those discussed in the forward-looking statements include, but are not limited to: deterioration of general business and economic conditions, including the real estate and financial markets, in the United States and in the geographic regions and communities we serve; risks related to liquidity; our capital and liquidity requirements (including under regulatory capital standards, such as Basel III capital standards) and our ability to generate or raise capital; changes in interest rates that affect the pricing of our financial products, the demand for our financial services and the valuation of our financial assets and liabilities, mortgage servicing rights and mortgages held for sale; risk of higher loan and lease charge-offs; legislative or regulatory actions affecting or concerning mortgage loan modification and refinancing and foreclosure; our ability to comply with any supervisory actions to which we are or become subject as a result of examination by our regulators; concentration of our commercial real estate loan portfolio; higher than normal delinquency and default rates; limited ability to rely on brokered deposits as a part of our funding strategy; our ability to comply with the consent order and complete the independent foreclosure review in a timely manner; concentration of mass-affluent clients and jumbo mortgages; hedging strategies; the effectiveness of our derivatives to manage interest rate risk; delinquencies on our equipment leases and reductions in the resale value of leased equipment; increases in loan repurchase requests and our reserves for loan repurchases; changes in currency exchange rates or other political or economic changes in certain foreign countries; loss of key personnel; fraudulent and negligent acts by loan applicants, mortgage brokers, other vendors and our employees; changes in and compliance with laws and regulations that govern our operations; failure to establish and maintain effective internal controls and procedures; effects of changes in existing U.S. government or government-sponsored mortgage programs; changes in laws and regulations that may restrict our ability to originate or increase our risk of liability with respect to certain mortgage loans; risks related to the approval and consummation of anticipated acquisitions; risks related to the continuing integration of acquired businesses and any future acquisitions; environmental liabilities with respect to properties that we take title to upon foreclosure; and the inability of our banking subsidiary to pay dividends.

For additional factors that could materially affect our financial results, please refer to EverBank Financial Corp’s filings with the Securities and Exchange Commission, including but not limited to, the risks described under the headings “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” The Company undertakes no obligation to revise these statements following the date of this news release, except as required by law.

EverBank Financial Corp. and Subsidiaries
Condensed Consolidated Balance Sheets (unaudited)
(Dollars in thousands, except per share data)

 
 

June 30, 2013
  December 31,

2012
Assets
Cash and due from banks $ 40,841 $ 175,400
Interest-bearing deposits in banks 448,746   268,514  
Total cash and cash equivalents 489,587 443,914
Investment securities:
Available for sale, at fair value 1,357,752 1,619,878
Held to maturity (fair value of $114,853 and $146,709 as of June 30, 2013 and December 31, 2012, respectively) 115,319 143,234
Other investments 142,225   158,172  
Total investment securities 1,615,296 1,921,284
Loans held for sale (includes $1,327,883 and $1,452,236 carried at fair value as of June 30, 2013 and December 31, 2012, respectively) 2,000,390 2,088,046
Loans and leases held for investment:
Loans and leases held for investment, net of unearned income 12,867,388 12,505,089
Allowance for loan and lease losses (73,469 ) (82,102 )
Total loans and leases held for investment, net 12,793,919 12,422,987
Equipment under operating leases, net 39,850 50,040
Mortgage servicing rights (MSR), net 462,718 375,859
Deferred income taxes, net 139,814 170,877
Premises and equipment, net 65,930 66,806
Other assets 755,368   703,065  
Total Assets $ 18,362,872   $ 18,242,878  
Liabilities
Deposits:
Noninterest-bearing $ 1,205,326 $ 1,445,783
Interest-bearing 12,464,540   11,696,605  
Total deposits 13,669,866 13,142,388
Other borrowings 2,667,700 3,173,021
Trust preferred securities 103,750 103,750
Accounts payable and accrued liabilities 372,173   372,543  
Total Liabilities 16,813,489 16,791,702
Commitments and Contingencies
Shareholders’ Equity
Series A 6.75% Non-Cumulative Perpetual Preferred Stock, $0.01 par value (liquidation preference of $25,000 per share;10,000,000 shares authorized; 6,000 issued and outstanding at June 30, 2013 and December 31, 2012) 150,000 150,000
Common Stock, $0.01 par value (500,000,000 shares authorized;122,383,260 and 120,987,955 issued and outstanding at June 30, 2013 and December 31, 2012, respectively) 1,224 1,210
Additional paid-in capital 827,682 811,085
Retained earnings 650,866 575,665
Accumulated other comprehensive income (loss) (AOCI) (80,389 ) (86,784 )
Total Shareholders’ Equity 1,549,383   1,451,176  
Total Liabilities and Shareholders’ Equity $ 18,362,872   $ 18,242,878  
 

EverBank Financial Corp. and Subsidiaries
Condensed Consolidated Statements of Income (unaudited)
(Dollars in thousands, except per share data)
 
  Three Months Ended

June 30,
  Six Months Ended

June 30,
2013   2012 2013   2012
Interest Income
Interest and fees on loans and leases $ 172,723 $ 135,816 $ 346,509 $ 260,594
Interest and dividends on investment securities 14,813 20,699 31,063 41,248
Other interest income 317   82   615   186  
Total Interest Income 187,853 156,597 378,187 302,028
Interest Expense
Deposits 26,567 20,419 53,390 41,393
Other borrowings 20,069   11,194   39,764   20,028  
Total Interest Expense 46,636   31,613   93,154   61,421  
Net Interest Income 141,217 124,984 285,033 240,607
Provision for Loan and Lease Losses 29   5,757   1,948   17,112  
Net Interest Income after Provision for Loan and Lease Losses 141,188 119,227 283,085 223,495
Noninterest Income
Loan servicing fee income 47,192 42,483 89,355 88,039
Amortization and impairment of mortgage servicing rights (3,373 ) (64,277 ) (25,896 ) (108,760 )
Net loan servicing income 43,819 (21,794 ) 63,459 (20,721 )
Gain on sale of loans 75,837 69,926 158,148 118,103
Loan production revenue 10,063 9,852 19,552 17,289
Deposit fee income 4,290 5,828 10,215 12,067
Other lease income 6,471 8,822 12,882 17,485
Other 6,324   1,489   15,857   3,093  
Total Noninterest Income 146,804 74,123 280,113 147,316
Noninterest Expense
Salaries, commissions and other employee benefits expense 118,457 76,277 228,936 142,867
Equipment expense 20,707 16,889 40,559 32,837
Occupancy expense 7,547 6,017 14,931 11,366
General and administrative expense 66,829   76,600   140,930   147,534  
Total Noninterest Expense 213,540   175,783   425,356   334,604  
Income before Provision for Income Taxes 74,452 17,567 137,842 36,207
Provision for Income Taxes 28,459   6,395   52,703   13,189  
Net Income $ 45,993   $ 11,172   $ 85,139   $ 23,018  
Less: Net Income Allocated to Preferred Stock (2,531 ) (1,685 ) (5,062 ) (7,664 )
Net Income Allocated to Common Shareholders $ 43,462   $ 9,487   $ 80,077   $ 15,354  
Basic Earnings Per Common Share $ 0.36 $ 0.09 $ 0.66 $ 0.17
Diluted Earnings Per Common Share $ 0.35 $ 0.09 $ 0.65 $ 0.17
Dividends Declared Per Common Share $ 0.02 $ $ 0.04 $
 

Non-GAAP Financial Measures

This press release contains financial information and performance measures determined by methods other than in accordance with accounting principles generally accepted in the United States of America (“GAAP”). Adjusted Net Income, Adjusted Earnings Per Share, Adjusted Return on Equity, Adjusted Non-Performing Asset Ratio, Tangible Shareholders’ Equity, Tangible Common Shareholders' Equity, Adjusted Tangible Common Shareholders’ Equity, and Tangible Assets are non-GAAP financial measures. The Company’s management uses these measures to evaluate the underlying performance and efficiency of its operations. The Company’s management believes these non-GAAP measures allow for a better evaluation and transparency of the operating performance of the Company’s business and facilitate a meaningful comparison of our results in the current period to those in prior periods and future periods because these non-GAAP measures exclude certain items that may not be indicative of our core operating results and business outlook. In addition, the Company’s management believes that certain of these non-GAAP measures represent a consistent benchmark against which to evaluate the Company’s growth, profitability and capital position. These non-GAAP measures are provided to enhance investors’ overall understanding of our current financial performance, and not as a substitute for, the Company’s reported results. Moreover, the manner in which we calculate these measures may differ from that of other companies reporting non-GAAP measures with similar names.

In the tables below, we have provided a reconciliation of, where applicable, the most comparable GAAP financial measures and ratios to the non-GAAP financial measures and ratios used in this press release, or a reconciliation of the non-GAAP calculation of the financial measure for the periods indicated:

EverBank Financial Corp. and Subsidiaries
         
Adjusted Net Income                    
  Three Months Ended
(dollars in thousands, except per share data) June 30, 2013 March 31, 2013

December 31,

2012

September 30,

2012
June 30, 2012
Net income $ 45,993 $ 39,146 $ 28,846 $ 22,178 $ 11,172
Transaction expense, net of tax 903 1,268 2,363
Non-recurring regulatory related expense, net of tax 12,042 11,425 9,564 1,326 3,780
Increase in Bank of Florida non-accretable discount, net of tax (538 ) 950 486 111 463
Adoption of TDR guidance and policy change, net of tax 3,709
MSR impairment (recovery), net of tax (20,194 ) (7,784 )   11,302   18,684
Adjusted net income $ 37,303   $ 43,737   $ 43,508   $ 36,185   $ 36,462
Adjusted net income allocated to preferred stock 2,531   2,531   1,491     2,206
Adjusted net income allocated to common shareholders $ 34,772   $ 41,206   $ 42,017   $ 36,185   $ 34,256
Adjusted net earnings per common share, basic $ 0.28 $ 0.34 $ 0.35 $ 0.31 $ 0.34
Adjusted net earnings per common share, diluted $ 0.28 $ 0.33 $ 0.34 $ 0.30 $ 0.33
Weighted average common shares outstanding:
(units in thousands)
Basic 122,281 121,583 120,773 118,038 100,779
Diluted 124,034 123,439 122,807 119,591 102,574
 

EverBank Financial Corp. and Subsidiaries
 
Tangible Equity, Tangible Common Equity,

Adjusted Tangible Common Equity and Tangible Assets
(dollars in thousands)   June 30, 2013   March 31, 2013  

December 31,

2012
 

September 30,

2012
  June 30, 2012
Shareholders’ equity $ 1,549,383 $ 1,504,442 $ 1,451,176 $ 1,258,022 $ 1,181,369
Less:
Goodwill 46,859 46,859 46,859 10,238 10,238
Intangible assets 6,867   7,394   7,921   6,348   6,700  
Tangible equity 1,495,657 1,450,189 1,396,396 1,241,436 1,164,431
Less:
Perpetual preferred stock 150,000   150,000   150,000      
Tangible common equity 1,345,657 1,300,189 1,246,396 1,241,436 1,164,431
Less:
Accumulated other comprehensive loss (80,389 ) (80,324 ) (86,784 ) (106,731 ) (113,094 )
Adjusted tangible common equity $ 1,426,046   $ 1,380,513   $ 1,333,180   $ 1,348,167   $ 1,277,525  
 
Total assets $ 18,362,872 $ 18,306,488 $ 18,242,878 $ 16,509,440 $ 15,040,824
Less:
Goodwill 46,859 46,859 46,859 10,238 10,238
Intangible assets 6,867   7,394   7,921   6,348   6,700  
Tangible assets $ 18,309,146   $ 18,252,235   $ 18,188,098   $ 16,492,854   $ 15,023,886  
 
Regulatory Capital (bank level)                    
(dollars in thousands) June 30, 2013 March 31, 2013

December 31,

2012

September 30,

2012
June 30, 2012
Shareholders’ equity $ 1,598,419 $ 1,560,001 $ 1,518,934 $ 1,339,669 $ 1,263,687
Less: Goodwill and other intangibles (51,807 ) (52,089 ) (54,780 ) (16,586 ) (16,938 )
Disallowed servicing asset (36,182 ) (31,585 ) (32,378 ) (33,366 ) (36,650 )
Disallowed deferred tax asset (65,406 ) (66,351 ) (67,296 ) (69,412 ) (70,357 )
Add: Accumulated losses on securities and cash flow hedges 78,181   77,073   83,477   103,238   110,101  
Tier 1 capital 1,523,205 1,487,049 1,447,957 1,323,543 1,249,843
Less: Low-level recourse and residual interests
Add: Allowance for loan and lease losses 73,469   77,067   82,102   76,469   77,393  
Total regulatory capital $ 1,596,674   $ 1,564,116   $ 1,530,059   $ 1,400,012   $ 1,327,236  
 
Adjusted total assets $ 18,287,359 $ 18,234,886 $ 18,141,856 $ 16,488,067 $ 15,022,729
Risk-weighted assets 11,656,698 11,406,725 11,339,415 8,701,164 8,424,290

EverBank Financial Corp. and Subsidiaries
Non-Performing Assets(1)                    
(dollars in thousands)   June 30, 2013   March 31, 2013  

December 31,

2012
 

September 30,

2012
  June 30, 2012
Non-accrual loans and leases:
Residential mortgages $ 64,230 $ 69,876 $ 73,752 $ 75,355 $ 66,956
Commercial and commercial real estate 60,636 63,924 76,289 85,306 95,882
Lease financing receivables 2,601 2,791 2,010 2,018 1,295
Home equity lines 4,368 4,513 4,246 4,492 4,256
Consumer and credit card 243   364   332   479   573  
Total non-accrual loans and leases 132,078 141,468 156,629 167,650 168,962
Accruing loans 90 days or more past due       1,973   1,800  
Total non-performing loans (NPL) 132,078 141,468 156,629 169,623 170,762
Other real estate owned (OREO) 36,528   39,576   40,492   43,612   49,248  
Total non-performing assets (NPA) 168,606 181,044 197,121 213,235 220,010
Troubled debt restructurings (TDR) less than 90 days past due 82,236   88,888   90,094   82,030   93,184  
Total NPA and TDR(1) $ 250,842   $ 269,932   $ 287,215   $ 295,265   $ 313,194  
 
Total NPA and TDR $ 250,842 $ 269,932 $ 287,215 $ 295,265 $ 313,194
Government-insured 90 days or more past due still accruing 1,405,848 1,547,995 1,729,877 1,684,550 1,647,567
Loans accounted for under ASC 310-30:
90 days or more past due 54,054 67,630 79,984 117,506 140,797
OREO 21,194   22,955   16,528   18,557   20,379  
Total regulatory NPA and TDR $ 1,731,938   $ 1,908,512   $ 2,113,604   $ 2,115,878   $ 2,121,937  
Adjusted credit quality ratios excluding government-insured loans and loans accounted for under ASC 310-30: (1)
NPL to total loans 0.89 % 0.97 % 1.08 % 1.49 % 1.57 %
NPA to total assets 0.92 % 0.99 % 1.08 % 1.29 % 1.46 %
NPA and TDR to total assets 1.37 % 1.47 % 1.57 % 1.79 % 2.08 %
Credit quality ratios including government-insured loans and loans accounted for under ASC 310-30:
NPL to total loans 10.76 % 12.04 % 13.55 % 17.32 % 18.00 %
NPA to total assets 8.98 % 9.94 % 11.09 % 12.32 % 13.49 %
NPA and TDR to total assets 9.43 % 10.43 % 11.59 % 12.82 % 14.11 %

(1) We define non-performing assets, or NPA, as non-accrual loans, accruing loans past due 90 days or more and foreclosed property. Our NPA calculation excludes government-insured pool buyout loans for which payment is insured by the government. We also exclude loans and foreclosed property accounted for under ASC 310-30 because we expect to fully collect the carrying value of such loans and foreclosed property.

EverBank Financial Corp. and Subsidiaries
Business Segments Selected Financial Information
(dollars in thousands)   Banking and

Wealth

Management
  Mortgage

Banking
  Corporate

Services
  Eliminations   Consolidated
Three Months Ended June 30, 2013
Net interest income $ 127,072 $ 15,719 $ (1,574 ) $ $ 141,217
Provision for loan and lease losses (1,320 ) 1,349       29  
Net interest income after provision for loan and lease losses 128,392 14,370 (1,574 ) 141,188
Noninterest income 32,654 113,901 249 146,804
Noninterest expense:
Foreclosure and OREO expense 6,577 3,037 9,614
Other credit-related expenses 1,238 612 1,850
All other noninterest expense 64,155   114,275   23,646     202,076  
Income (loss) before income tax 89,076   10,347   (24,971 )   74,452  
Adjustment items (pre-tax):
Increase in Bank of Florida non-accretable discount (867 ) (867 )
MSR impairment (recovery) (32,572 ) (32,572 )
Transaction and non-recurring regulatory related expense   18,012   1,410     19,422  
Adjusted income (loss) before income tax 88,209   (4,213 ) (23,561 )   60,435  
Total assets as of June 30, 2013 15,588,567   2,805,876   194,395   (225,966 ) 18,362,872  
 
Three Months Ended March 31, 2013
Net interest income $ 132,373 $ 13,014 $ (1,571 ) $ $ 143,816
Provision for loan and lease losses (79 ) 1,998       1,919  
Net interest income after provision for loan and lease losses 132,452 11,016 (1,571 ) 141,897
Noninterest income 27,781 105,369 159 133,309
Noninterest expense:
Foreclosure and OREO expense 5,285 1,742 7,027
Other credit-related expenses 670 1,658 2,328
All other noninterest expense 77,848   99,538   25,075     202,461  
Income (loss) before income tax 76,430   13,447   (26,487 )   63,390  
Adjustment items (pre-tax):
Increase in Bank of Florida non-accretable discount 1,532 1,532
MSR impairment (recovery) (12,555 ) (12,555 )
Transaction and non-recurring regulatory related expense 5,252   11,531   1,646     18,429  
Adjusted income (loss) before income tax 83,214   12,423   (24,841 )   70,796  
Total assets as of March 31, 2013 15,251,578   3,152,487   158,767   (256,344 ) 18,306,488  
Three Months Ended June 30, 2012            
Net interest income $ 114,801 $ 11,790 $ (1,607 ) $ $ 124,984
Provision for loan and lease losses 5,041   716       5,757
Net interest income after provision for loan and lease losses 109,760 11,074 (1,607 ) 119,227
Noninterest income 25,605 48,524 (6 ) 74,123
Noninterest expense:
Foreclosure and OREO expense 12,378 2,591 14,969
Other credit-related expenses 1,604 4,193 9 5,806
All other noninterest expense 61,564   60,686   32,758     155,008
Income (loss) before income tax 59,819   (7,872 ) (34,380 )   17,567
Adjustment items (pre-tax):
Increase in Bank of Florida non-accretable discount 747 747
MSR impairment (recovery) 30,135 30,135
Transaction and non-recurring regulatory related expense   5,461   4,448     9,909
Adjusted income (loss) before income tax 60,566   27,724   (29,932 )   58,358
Total assets as of June 30, 2012 13,327,046   1,902,152   124,406   (312,780 ) 15,040,824

Copyright Business Wire 2010

More from Press Releases

NFL Pushes for Regulation Following Supreme Court's Sports Gambling Ruling

NFL Pushes for Regulation Following Supreme Court's Sports Gambling Ruling

21st Century Fox Scoops Up Local News Stations

21st Century Fox Scoops Up Local News Stations

Walmart CEO: 'We Are Transforming Globally' With Flipkart

Walmart CEO: 'We Are Transforming Globally' With Flipkart

Three-Part FREE Webinar Series

Three-Part FREE Webinar Series

March 24 Full-Day Course Offering: Professional Approach to Trading SPX

March 24 Full-Day Course Offering: Professional Approach to Trading SPX