Western Alliance Bancorporation (NYSE: WAL) announced today its financial results for the fourth quarter 2013.
Fourth Quarter 2013 Highlights:
- Net income of $31.4 million, compared to $28.2 million for the third quarter 2013 and $32.1 million for the fourth quarter 2012
- Net income of $29.8 million for the fourth quarter 2013, excluding the following, net of tax effect: $3.7 million tax benefit related to the Western Liberty acquisition, $1.3 million net gain on other repossessed assets, $1.3 million net loss from debt valuation adjustments and securities gains, $1.2 million merger/restructure expenses, and $0.9 million net loss on extinguishment of debt
- Earnings per share of $0.36, compared to $0.32 per share in the third quarter 2013 and $0.37 per share in the fourth quarter 2012
- Earnings per share of $0.34 for the fourth quarter 2013, excluding the following, net of tax effect: $0.04 tax benefit related to the Western Liberty acquisition, $0.02 net gain on other repossessed assets, $0.02 net loss from debt valuation adjustments and securities gains, $0.01 merger/restructure expenses, and $0.01 net loss on extinguishment of debt
- Pre-tax, pre-provision operating earnings of $43.8 million, up 4.2% from $42.1 million in third quarter 2013 and up 19.1% from $36.8 million in fourth quarter 20121
- Net interest margin of 4.44%, compared to 4.41% in the third quarter 2013 and 4.55% in the fourth quarter 2012
- Total loans of $6.80 billion, up $285 million from September 30, 2013
- Total deposits of $7.84 billion, up $563 million from September 30, 2013
- Nonperforming assets (nonaccrual loans and repossessed assets) decreased to 1.5% of total assets from 1.7% in the third quarter 2013 and from 2.4% in the fourth quarter 2012
- Net loan charge-offs (annualized) to average loans outstanding of 0.13%, compared to net loan recoveries to average loans of 0.10% in the third quarter 2013 and net loan charge-offs to average loans of 0.99% in the fourth quarter 2012
- Tier I Leverage capital of 9.8% and Total Risk-Based Capital ratio of 12.6%, compared to 10.1% and 12.6%, respectively, at December 31, 2013
- Total equity of $855 million, up $96 million from December 31, 2012
Full Year 2013 Highlights:
- Net income of $114.5 million, compared to $72.8 million for 2012
- Return on assets and return on tangible common equity of 1.35% and 16.67%, compared to 1.01% and 12.37%, respectively, in 2012
- Earnings per share of $1.31, compared to $0.83 per share for 2012
- Net interest margin of 4.39%, compared to 4.49% in 2012
- Total loan and deposit growth of $1.09 billion and $1.38 billion, respectively, from December 31, 2012
Financial Performance
"2013 was an outstanding year for Western Alliance, with exceptional balance sheet growth, record revenue and earnings, and low credit losses," said Robert Sarver, Chairman and Chief Executive Officer of Western Alliance Bancorporation. "Our team of professionals from the front line to the back office have driven our strong performance as we continue to win business. During the fourth quarter, our loan and deposit growth accelerated without sacrificing quality and margin."
Sarver continued, "On December 31, 2013, we consolidated our three affiliate banks under one charter, which will enable us to improve efficiency and risk identification and management, while maintaining our high level of customer service and responsiveness."
Income Statement
Net interest income was $90.0 million in the fourth quarter 2013, an increase of $5.4 million, or 6.4%, from $84.6 million in the third quarter of 2013 and an increase of $12.5 million, or 16.2%, compared to the fourth quarter 2012. The Company's net interest margin increased in the fourth quarter 2013 to 4.44%, compared to 4.41% in the third quarter 2013 and declined from 4.55% in the fourth quarter 2012.
Operating non-interest income was $5.2 million for the fourth quarter 2013, compared to $5.8 million in the third quarter of 2013 and $5.1 million for the fourth quarter of 2012.1
Net operating revenue was $95.2 million for the fourth quarter 2013, an increase of 5.3% compared to $90.4 million for the third quarter of 2013 and an increase of 15.3% compared to $82.5 million for the fourth quarter 2012.1
Operating non-interest expense was $51.4 million for the fourth quarter 2013, compared to $48.3 million for the third quarter of 2013 and $45.8 million for the fourth quarter of 2012.1 The Company's operating efficiency ratio1 on a tax equivalent basis was 51.9% for the fourth quarter 2013, compared to 51.6% for the third quarter 2013 and an improvement from 53.5% for the fourth quarter 2012.
Income tax expense decreased as a result of increased deductibility of credit losses related to the Western Liberty acquisition.
The Company had 1,051 full-time equivalent employees and 40 offices at December 31, 2013, compared to 982 employees and 40 offices at December 31, 2012.
The Company views its pre-tax, pre-provision operating earnings as a key metric for assessing the Company's earning power, which it defines as net operating revenue less operating non-interest expense. For the fourth quarter 2013, the Company's pre-tax, pre-provision operating earnings were $43.8 million, up from $42.1 million in the third quarter 2013 and up 19.1% from $36.8 million in the fourth quarter 2012.1
The provision for credit losses was $4.3 million for the fourth quarter 2013, compared to zero in the third quarter 2013 and $11.5 million for the fourth quarter 2012. Net loan charge-offs in the fourth quarter 2013 were $2.1 million, or 0.13% of average loans (annualized), compared to net loan recoveries to average loans of 0.10% for the third quarter 2013. Net charge-offs for the fourth quarter 2012 were $13.5 million, or 0.99% of average loans (annualized).
Nonaccrual loans decreased $1.0 million to $75.7 million during the quarter. Loans past due 90 days and still accruing interest totaled $1.5 million at December 31, 2013, compared to $5.5 million at September 30, 2013 and $1.4 million at December 31, 2012. Loans past due 30-89 days, still accruing interest totaled $13.4 million at quarter end, up from $8.7 million at September 30, 2013 and down from $16.6 million at December 31, 2012.
As the Company's asset quality improved and its capital increased, the ratio of classified assets to Tier I capital plus the allowance for credit losses, a common regulatory measure of asset quality, improved to 27% at December 31, 2013 from 34% at December 31, 2012.1
Net gain on repossessed assets (primarily other real estate) was $2.2 million for the fourth quarter 2013, compared to a net loss of $0.4 million in the third quarter 2013 and a net loss of $0.5 million in the fourth quarter 2012. At December 31, 2013, other repossessed assets totaled $67 million, compared to $77 million at September 30, 2013 and December 31, 2012.
Balance Sheet
Gross loans totaled $6.80 billion at December 31, 2013, an increase of $285 million from September 30, 2013 and an increase of $1.09 billion from $5.71 billion at December 31, 2012. At December 31, 2013, the allowance for credit losses was 1.47% of total loans, compared to 1.50% at September 30, 2013 and 1.67% at December 31, 2012, reflecting an improvement in the Company's asset profile.
Deposits totaled $7.84 billion at December 31, 2013, an increase of $563 million from $7.28 billion at September 30, 2013 and an increase of $1.38 billion from $6.46 billion at December 31, 2012. Non-interest bearing deposits were $2.20 billion at December 31, 2013, compared to $1.97 billion at September 30, 2013 and $1.93 billion at December 31, 2012. Non-interest bearing deposits comprised 28.1% of total deposits at December 31, 2013, compared to 29.9% at December 31, 2012, while the proportion of savings and money market accounts increased to 42.2% from 39.9% during the same period. Certificates of deposit as a percent of total deposits were 20.6% at December 31, 2013, compared to 21.2% at December 31, 2012. The Company's ratio of loans to deposits was 86.8% at December 31, 2013, compared to 89.6% at September 30, 2013 and 88.5% at December 31, 2012.
Stockholders' equity at December 31, 2013 increased to $855 million from $826 million at September 30, 2013. At December 31, 2013, tangible common equity was 7.4% of tangible assets1 and total risk-based capital was 12.6% of risk-weighted assets. The Company's tangible book value per share1 was $7.89 at December 31, 2013, up 15.4% during the past year.
Total assets increased 4.3% to $9.31 billion at December 31, 2013 from $8.92 billion at September 30, 2013, and 22.1% from $7.62 billion at December 31, 2012.
Segment Highlights
Western Alliance Bank reported loan growth of $245 million during the fourth quarter 2013 and $797 million during the last 12 months to $2.83 billion. Fourth quarter loan growth came primarily from commercial and industrial and construction and land development loans. Deposits increased $233 million in the fourth quarter and $840 million during the last 12 months to $3.06 billion. Net income for Western Alliance Bank was $12.7 million during the fourth quarter 2013, compared with net income of $9.8 million during the third quarter of 2013 and $10.4 million during the fourth quarter 2012.
Bank of Nevada reported that loans decreased by $102 million during the fourth quarter of 2013 and increased $102 million during the last 12 months to $2.29 billion at December 31, 2013. The decline in fourth quarter loans came primarily from a decrease in commercial real estate and commercial and industrial loans. Deposits increased by $150 million in the fourth quarter of 2013 and increased $194 million over the last twelve months to $2.76 billion. Net income for Bank of Nevada was $13.0 million for the fourth quarter 2013, compared with net income of $16.3 million for the third quarter of 2013 and $7.6 million during the fourth quarter 2012.
Torrey Pines Bank, exclusive of the discontinued operations of PartnersFirst, reported that loans increased $100 million during the fourth quarter 2013 and increased $116 million during the last 12 months to $1.62 billion. The fourth quarter increase in the loan balances were primarily attributable to an increase in commercial real estate and commercial and industrial loans. Deposits increased $177 million in the fourth quarter 2013 and $342 million over the last 12 months to $2.02 billion. Net income for Torrey Pines Bank was $6.0 million during the fourth quarter 2013, compared with net income of $4.6 million for the third quarter of 2013 and $5.2 million during the fourth quarter 2012.
On December 31, 2013, the Company consolidated its three bank subsidiaries under one charter, Western Alliance Bank. Prior to the consolidation, Alliance Bank of Arizona and First Independent Bank operated as divisions of Western Alliance Bank. In 2014, Bank of Nevada and Torrey Pines Bank also will operate as divisions of Western Alliance Bank.
Attached to this press release is summarized financial information for the quarter ended December 31, 2013.
Conference Call and Webcast
Western Alliance Bancorporation will host a conference call and live webcast to discuss its fourth quarter 2013 financial results at 12:00 p.m. ET on Friday, January 24, 2014. Participants may access the call by dialing 1-888-317-6003 and using passcode: 1025905 or via live audio webcast using the website link: http://services.choruscall.com/links/wal140124.html. The webcast is also available via the Company's website at www.westernalliancebancorp.com. Participants should log in at least 15 minutes early to receive instructions. The call will be recorded and made available for replay after 2:00 p.m. ET January 24th through February 10th at 9:00 a.m. ET by dialing 1-877-344-7529 passcode: 10038670.
About Western Alliance Bancorporation
Western Alliance Bancorporation (NYSE: WAL) is a leading bank holding company providing comprehensive business banking and related financial services through its wholly-owned banking subsidiary, Western Alliance Bank (the "Bank"). With local teams of experienced bankers, the Bank provides a superior level of capabilities, products and service, to assist the growth of local businesses and the quality of life in the markets it serves. In addition to a national platform of specialized financial service units, the Bank operates full service banking divisions in its local markets as Alliance Bank of Arizona, Bank of Nevada, First Independent Bank and Torrey Pines Bank. Western Alliance Bancorporation is publicly traded on the New York Stock Exchange. Additional investor information can be accessed on the Investor Relations page of the Company's website, www.westernalliancebancorp.com.
Cautionary Note Regarding Forward-Looking Statements
This release contains forward-looking statements that relate to expectations, beliefs, projections, future plans and strategies, anticipated events or trends and similar expressions concerning matters that are not historical facts. Examples of forward-looking statements include, among others, statements we make regarding guidance or expectations relating to balance sheet growth, interest margin, operating efficiency, asset quality, and regulatory capital. The forward-looking statements contained herein reflect our current views about future events and financial performance and are subject to risks, uncertainties, assumptions and changes in circumstances that may cause our actual results to differ significantly from historical results and those expressed in any forward-looking statement. Some factors that could cause actual results to differ materially from historical or expected results include, among others: factors discussed in the Company's Annual Report on Form 10-K for the year ended December 31, 2012 as filed with the Securities and Exchange Commission; changes in general economic conditions, either nationally or locally in the areas in which we conduct or will conduct our business; inflation, interest rate, market and monetary fluctuations; increases in competitive pressures among financial institutions and businesses offering similar products and services; higher defaults on our loan portfolio than we expect; changes in management's estimate of the adequacy of the allowance for credit losses; legislative or regulatory changes or changes in accounting principles, policies or guidelines; supervisory actions by regulatory agencies which may limit our ability to pursue certain growth opportunities; management's estimates and projections of interest rates and interest rate policy; the execution of our business plan; and other factors affecting the financial services industry generally or the banking industry in particular.
Any forward-looking statement made by us in this release is based only on information currently available to us and speaks only as of the date on which it is made. We do not intend and disclaim any duty or obligation to update or revise any industry information or forward-looking statements, whether written or oral, that may be made from time to time, set forth in this press release to reflect new information, future events or otherwise.
This press release contains both financial measures based on accounting principles generally accepted in the United States ("GAAP") and non-GAAP based financial measures, which are used where management believes it to be helpful in understanding Western Alliance Bancorporation's results of operations or financial position. Where non-GAAP financial measures are used, the comparable GAAP financial measure, as well as the reconcilement to the comparable GAAP financial measure, can be found in this press release. These disclosures should not be viewed as a substitute for operating results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies.
1 See Reconciliation of Non-GAAP Financial Measures
Western Alliance Bancorporation and Subsidiaries | ||||||||||||||||||||||||||||||
Summary Consolidated Financial Data | ||||||||||||||||||||||||||||||
Unaudited | ||||||||||||||||||||||||||||||
At or for the Three Months Ended |
For the Twelve Months Ended | |||||||||||||||||||||||||||||
2013 | 2012 | Change | % | 2013 | 2012 | Change | % | |||||||||||||||||||||||
Selected Balance Sheet Data: | ||||||||||||||||||||||||||||||
(dollars in millions) | ||||||||||||||||||||||||||||||
Total assets | $ | 9,307.1 | $ | 7,622.6 | 22.1 | % | ||||||||||||||||||||||||
Loans, net of deferred fees | 6,801.4 | 5,709.3 | 19.1 | |||||||||||||||||||||||||||
Securities and money market investments | 1,689.6 | 1,236.6 | 36.6 | |||||||||||||||||||||||||||
Total deposits | 7,838.2 | 6,455.2 | 21.4 | |||||||||||||||||||||||||||
Borrowings | 341.1 | 193.7 | 76.1 | |||||||||||||||||||||||||||
Junior subordinated debt | 41.9 | 36.2 | 15.7 | |||||||||||||||||||||||||||
Stockholders' equity | 855.3 | 759.6 | 12.6 | |||||||||||||||||||||||||||
Selected Income Statement Data: | ||||||||||||||||||||||||||||||
(dollars in thousands) | ||||||||||||||||||||||||||||||
Interest income | $ | 97,582 | $ | 84,343 | 15.7 | % | $ | 362,655 | $ | 318,295 | 13.9 | % | ||||||||||||||||||
Interest expense | 7,601 | 6,888 | 10.4 | 29,760 | 28,032 | 6.2 | ||||||||||||||||||||||||
Net interest income | 89,981 | 77,455 | 16.2 | 332,895 | 290,263 | 14.7 | ||||||||||||||||||||||||
Provision for loan losses | 4,300 | 11,501 | (62.6 | ) | 13,220 | 46,844 | (71.8 | ) | ||||||||||||||||||||||
Net interest income after provision for credit losses | 85,681 | 65,954 | 29.9 | 319,675 | 243,419 | 31.3 | ||||||||||||||||||||||||
Non-interest (loss) income | (158 | ) | 24,463 | (100.6 | ) | 17,228 | 44,726 | (61.5 | ) | |||||||||||||||||||||
Non-interest expense | 51,131 | 48,989 | 4.4 | 196,266 | 188,860 | 3.9 | ||||||||||||||||||||||||
Income from continuing operations, before income tax expense | 34,392 | 41,428 | (17.0 | ) | 140,637 | 99,285 | 41.6 | |||||||||||||||||||||||
Income tax expense | 2,341 | 7,509 | (68.8 | ) | 25,254 | 23,961 | 5.4 | |||||||||||||||||||||||
Income from continuing operations | 32,051 | 33,919 | (5.5 | ) | 115,383 | 75,324 | 53.2 | |||||||||||||||||||||||
Loss on discontinued operations, net | (701 | ) | (1,804 | ) | (61.1 | ) | (861 | ) | (2,490 | ) | (65.4 | ) | ||||||||||||||||||
Net income | $ | 31,350 | $ | 32,115 | (2.4 | )% | $ | 114,522 | $ | 72,834 | 57.2 | % | ||||||||||||||||||
Diluted net income per common share from continuing operations | $ | 0.37 | $ | 0.39 | (5.1 | )% | $ | 1.32 | $ | 0.86 | 53.5 | % | ||||||||||||||||||
Diluted net loss per common share from discontinued operations, net of tax | $ | (0.01 | ) | $ | (0.02 | ) | $ | (0.01 | ) | $ | (0.03 | ) | ||||||||||||||||||
Diluted net income per common share | $ | 0.36 | $ | 0.37 | (2.7 | )% | $ | 1.31 | $ | 0.83 | 57.8 | % | ||||||||||||||||||
Common Share Data: | ||||||||||||||||||||||||||||||
Diluted net income per common share | $ | 0.36 | $ | 0.37 | (2.7 | )% | $ | 1.31 | $ | 0.83 | 57.8 | % | ||||||||||||||||||
Book value per common share | $ | 8.19 | $ | 7.15 | 14.5 | % | ||||||||||||||||||||||||
Tangible book value per share, net of tax (1) | $ | 7.89 | $ | 6.84 | 15.4 | % | ||||||||||||||||||||||||
Average shares outstanding (in thousands): | ||||||||||||||||||||||||||||||
Basic | 85,939 | 84,416 | 1.8 | 85,682 | 82,285 | 4.1 | ||||||||||||||||||||||||
Diluted | 86,877 | 85,152 | 2.0 | 86,541 | 82,912 | 4.4 | ||||||||||||||||||||||||
Common shares outstanding | 87,186 | 86,465 | 0.8 | |||||||||||||||||||||||||||
(1) See Reconciliation of Non-GAAP Financial Measures | ||||||||||||||||||||||||||||||
Western Alliance Bancorporation and Subsidiaries | ||||||||||||||||||||||||||
Summary Consolidated Financial Data (continued) | ||||||||||||||||||||||||||
Unaudited | ||||||||||||||||||||||||||
At or for the Three Months Ended |
For the Twelve Months Ended | |||||||||||||||||||||||||
2013 | 2012 | Change | % | 2013 | 2012 | Change | % | |||||||||||||||||||
Selected Performance Ratios: | ||||||||||||||||||||||||||
Return on average assets (1) | 1.37 | % | 1.68 | % | (18.5 | )% | 1.35 | % | 1.01 | % | 33.7 | % | ||||||||||||||
Return on tangible common equity (2) | 18.11 | 21.70 | (16.5 | ) | 16.67 | 12.37 | 34.8 | |||||||||||||||||||
Net interest margin (1) | 4.44 | 4.55 | (2.4 | ) | 4.39 | 4.49 | (2.2 | ) | ||||||||||||||||||
Net interest spread | 4.27 | 4.37 | (2.3 | ) | 4.23 | 4.31 | (1.9 | ) | ||||||||||||||||||
Efficiency ratio - tax equivalent basis (2) | 51.92 | 53.48 | (2.9 | ) | 52.51 | 55.39 | (5.2 | ) | ||||||||||||||||||
Loan to deposit ratio | 86.77 | 88.45 | (1.9 | ) | ||||||||||||||||||||||
Capital Ratios: | ||||||||||||||||||||||||||
Tangible equity (2) | 8.9 | % | 9.6 | % | (7.3 | )% | ||||||||||||||||||||
Tangible common equity (2) | 7.4 | 7.8 | (5.1 | ) | ||||||||||||||||||||||
Tier 1 common equity (2) | 8.9 | 8.6 | 3.5 | |||||||||||||||||||||||
Tier 1 Leverage ratio (3) | 9.8 | 10.1 | (3.0 | ) | ||||||||||||||||||||||
Tier 1 Risk Based Capital (3) | 11.4 | 11.3 | 0.9 | |||||||||||||||||||||||
Total Risk Based Capital (3) | 12.6 | 12.6 | -- | |||||||||||||||||||||||
Asset Quality Ratios: | ||||||||||||||||||||||||||
Net charge-offs to average loans outstanding (1) | 0.13 | % | 0.99 | % | (86.9 | )% | 0.14 | % | 0.99 | % | (85.9 | )% | ||||||||||||||
Nonaccrual loans to gross loans | 1.11 | 1.83 | (39.3 | ) | ||||||||||||||||||||||
Nonaccrual loans and repossessed assets to total assets | 1.53 | 2.39 | (36.0 | ) | ||||||||||||||||||||||
Loans past due 90 days and still accruing to total loans | 0.02 | 0.02 | -- | |||||||||||||||||||||||
Allowance for credit losses to loans | 1.47 | 1.67 | (12.0 | ) | ||||||||||||||||||||||
Allowance for credit losses to nonaccrual loans | 132.20 | 91.13 | 45.1 | |||||||||||||||||||||||
(1) Annualized for the three month periods ended December 31, 2013 and 2012. | ||||||||||||||||||||||||||
(2) See Reconciliation of Non-GAAP Financial Measures. | ||||||||||||||||||||||||||
(3) Capital ratios are preliminary until the Call Report is filed. | ||||||||||||||||||||||||||
Western Alliance Bancorporation and Subsidiaries | ||||||||||||||||||||
Condensed Consolidated Income Statements | ||||||||||||||||||||
Unaudited | ||||||||||||||||||||
Three Months Ended |
Twelve Months Ended | |||||||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||||||
Interest income: | (dollars in thousands) | |||||||||||||||||||
Loans | $ | 86,902 | $ | 75,303 | $ | 326,714 | $ | 280,985 | ||||||||||||
Investment securities | 10,137 | 8,794 | 34,403 | 36,802 | ||||||||||||||||
Federal funds sold and other | 543 | 246 | 1,538 | 508 | ||||||||||||||||
Total interest income | 97,582 | 84,343 | 362,655 | 318,295 | ||||||||||||||||
Interest expense: | ||||||||||||||||||||
Deposits | 4,442 | 3,890 | 16,335 | 16,794 | ||||||||||||||||
Borrowings | 2,717 | 2,528 | 11,602 | 9,310 | ||||||||||||||||
Junior subordinated debt | 442 | 470 | 1,823 | 1,928 | ||||||||||||||||
Total interest expense | 7,601 | 6,888 | 29,760 | 28,032 | ||||||||||||||||
Net interest income | 89,981 | 77,455 | 332,895 | 290,263 | ||||||||||||||||
Provision for credit losses | 4,300 | 11,501 | 13,220 | 46,844 | ||||||||||||||||
Net interest income after provision for credit losses | 85,681 | 65,954 | 319,675 | 243,419 | ||||||||||||||||
Non-interest income (loss): | ||||||||||||||||||||
Service charges | 2,512 | 2,438 | 9,920 | 9,452 | ||||||||||||||||
Bank owned life insurance | 905 | 1,080 | 4,809 | 4,439 | ||||||||||||||||
Amortization of affordable housing investments | (1,714 | ) | (1,069 | ) | (5,018 | ) | (1,779 | ) | ||||||||||||
Gains (losses) on sales of investment securities, net | 342 | 1,447 | (1,195 | ) | 3,949 | |||||||||||||||
Unrealized (losses) gains on assets/liabilities measured at fair value, net | (2,618 | ) | (48 | ) | (6,386 | ) | 653 | |||||||||||||
Loss on extinguishment of debt | (1,387 | ) | -- | (1,387 | ) | -- | ||||||||||||||
Bargain purchase gain from acquisition | -- | 17,562 | 10,044 | 17,562 | ||||||||||||||||
Other | 1,802 | 3,053 | 6,441 | 10,450 | ||||||||||||||||
Total non-interest (loss) income | (158 | ) | 24,463 | 17,228 | 44,726 | |||||||||||||||
Non-interest expenses: | ||||||||||||||||||||
Salaries and employee benefits | 30,071 | 26,885 | 113,434 | 105,044 | ||||||||||||||||
Occupancy | 4,626 | 4,769 | 19,126 | 18,815 | ||||||||||||||||
Legal, professional and directors' fees | 4,623 | 2,418 | 13,633 | 10,237 | ||||||||||||||||
Insurance | 1,744 | 2,188 | 8,094 | 8,511 | ||||||||||||||||
Data Processing | 2,040 | 2,071 | 7,952 | 5,749 | ||||||||||||||||
Marketing | 619 | 575 | 2,581 | 2,305 | ||||||||||||||||
Loan and repossessed asset expenses | 793 | 2,102 | 4,246 | 6,675 | ||||||||||||||||
Customer service | 860 | 678 | 2,897 | 2,604 | ||||||||||||||||
Net (gain) loss on sales and valuations of repossessed assets | (2,153 | ) | 529 | (2,387 | ) | 4,207 | ||||||||||||||
Intangible amortization | 597 | 596 | 2,388 | 3,256 | ||||||||||||||||
Merger / restructure expense | 1,919 | 2,706 | 5,752 | 2,819 | ||||||||||||||||
Goodwill and intangible impairment | -- | -- | -- | 3,435 | ||||||||||||||||
Other | 5,392 | 3,472 | 18,550 | 15,203 | ||||||||||||||||
Total non-interest expense | 51,131 | 48,989 | 196,266 | 188,860 | ||||||||||||||||
Income from continuing operations before income taxes | 34,392 | 41,428 | 140,637 | 99,285 | ||||||||||||||||
Income tax expense | 2,341 | 7,509 | 25,254 | 23,961 | ||||||||||||||||
Income from continuing operations | $ | 32,051 | $ | 33,919 | $ | 115,383 | $ | 75,324 | ||||||||||||
Loss from discontinued operations net of tax benefit | (701 | ) | (1,804 | ) | (861 | ) | (2,490 | ) | ||||||||||||
Net income | $ | 31,350 | $ | 32,115 | $ | 114,522 | $ | 72,834 | ||||||||||||
Preferred stock dividends | 353 | 353 | 1,411 | 3,793 | ||||||||||||||||
Net income available to common stockholders | $ | 30,997 | $ | 31,762 | $ | 113,111 | $ | 69,041 | ||||||||||||
Diluted net income per share | $ | 0.36 | $ | 0.37 | $ | 1.31 | $ | 0.83 | ||||||||||||
Western Alliance Bancorporation and Subsidiaries | |||||||||||||||||||||||||
Five Quarter Condensed Consolidated Income Statements | |||||||||||||||||||||||||
Unaudited | Three Months Ended | ||||||||||||||||||||||||
Dec 31, 2013 | Sep 30, 2013 | Jun 30, 2013 | Mar 31, 2013 | Dec 31, 2012 | |||||||||||||||||||||
Interest income: | (in thousands, except per share data) | ||||||||||||||||||||||||
Loans | $ | 86,902 | $ | 83,994 | $ | 81,093 | $ | 74,725 | $ | 75,303 | |||||||||||||||
Investment securities | 10,137 | 8,286 | 7,822 | 8,158 | 8,794 | ||||||||||||||||||||
Federal funds sold and other | 543 | 400 | 370 | 225 | 246 | ||||||||||||||||||||
Total interest income | 97,582 | 92,680 | 89,285 | 83,108 | 84,343 | ||||||||||||||||||||
Interest expense: | |||||||||||||||||||||||||
Deposits | 4,442 | 4,232 | 3,929 | 3,732 | 3,890 | ||||||||||||||||||||
Borrowings | 2,717 | 3,429 | 2,749 | 2,707 | 2,528 | ||||||||||||||||||||
Junior subordinated debt | 442 | 460 | 455 | 466 | 470 | ||||||||||||||||||||
Total interest expense | 7,601 | 8,121 | 7,133 | 6,905 | 6,888 | ||||||||||||||||||||
Net interest income | 89,981 | 84,559 | 82,152 | 76,203 | 77,455 | ||||||||||||||||||||
Provision for credit losses | 4,300 | -- | 3,481 | 5,439 | 11,501 | ||||||||||||||||||||
Net interest income after provision for credit losses | 85,681 | 84,559 | 78,671 | 70,764 | 65,954 | ||||||||||||||||||||
Non-interest income (loss): | |||||||||||||||||||||||||
Service charges | 2,512 | 2,425 | 2,449 | 2,534 | 2,438 | ||||||||||||||||||||
Bank owned life insurance | 905 | 1,832 | 1,036 | 1,036 | 1,080 | ||||||||||||||||||||
Amortization of affordable housing investments | (1,714 | ) | (1,504 | ) | (900 | ) | (900 | ) | (1,069 | ) | |||||||||||||||
Gains (losses) on sales of investment securities, net | 342 | (1,679 | ) | (5 | ) | 147 | 1,447 | ||||||||||||||||||
Unrealized losses on assets/liabilities measured at fair value, net | (2,618 | ) | (7 | ) | (3,290 | ) | (471 | ) | (48 | ) | |||||||||||||||
Loss on extinguishment of debt | (1,387 | ) | -- | -- | -- | -- | |||||||||||||||||||
Bargain purchase gain from acquisition | -- | -- | 10,044 | -- | 17,562 | ||||||||||||||||||||
Other | 1,802 | 1,558 | 1,528 | 1,553 | 3,053 | ||||||||||||||||||||
Total non-interest (loss) income | (158 | ) | 2,625 | 10,862 | 3,899 | 24,463 | |||||||||||||||||||
Non-interest expenses: | |||||||||||||||||||||||||
Salaries and employee benefits | 30,071 | 28,689 | 28,100 | 26,574 | 26,885 | ||||||||||||||||||||
Occupancy | 4,626 | 4,901 | 4,753 | 4,846 | 4,769 | ||||||||||||||||||||
Legal, professional and directors' fees | 4,623 | 3,438 | 2,549 | 3,023 | 2,418 | ||||||||||||||||||||
Insurance | 1,744 | 1,884 | 2,096 | 2,370 | 2,188 | ||||||||||||||||||||
Data Processing | 2,040 | 1,872 | 2,175 | 1,865 | 2,071 | ||||||||||||||||||||
Marketing | 619 | 585 | 710 | 667 | 575 | ||||||||||||||||||||
Loan and repossessed asset expenses | 793 | 1,136 | 721 | 1,596 | 2,102 | ||||||||||||||||||||
Customer service | 860 | 677 | 717 | 643 | 678 | ||||||||||||||||||||
Net (gain) loss on sales and valuations of repossessed assets | (2,153 | ) | 371 | (1,124 | ) | 519 | 529 | ||||||||||||||||||
Intangible amortization | 597 | 597 | 597 | 597 | 596 | ||||||||||||||||||||
Merger / restructure expense | 1,919 | 1,018 | 2,620 | 195 | 2,706 | ||||||||||||||||||||
Other | 5,392 | 4,507 | 4,617 | 4,034 | 3,472 | ||||||||||||||||||||
Total non-interest expense | 51,131 | 49,675 | 48,531 | 46,929 | 48,989 | ||||||||||||||||||||
Income from continuing operations before income taxes | 34,392 | 37,509 | 41,002 | 27,734 | 41,428 | ||||||||||||||||||||
Income tax expense | 2,341 | 9,288 | 6,817 | 6,808 | 7,509 | ||||||||||||||||||||
Income from continuing operations | $ | 32,051 | $ | 28,221 | $ | 34,185 | $ | 20,926 | $ | 33,919 | |||||||||||||||
(Loss) Income from discontinued operations, net of tax | (701 | ) | (29 | ) | (169 | ) | 38 | (1,804 | ) | ||||||||||||||||
Net income | $ | 31,350 | $ | 28,192 | $ | 34,016 | $ | 20,964 | $ | 32,115 | |||||||||||||||
Preferred stock dividends | 353 | 352 | 353 | 353 | 353 | ||||||||||||||||||||
Net Income available to common stockholders | $ | 30,997 | $ | 27,840 | $ | 33,663 | $ | 20,611 | $ | 31,762 | |||||||||||||||
Diluted net income per share | $ | 0.36 | $ | 0.32 | $ | 0.39 | $ | 0.24 | $ | 0.37 | |||||||||||||||
Western Alliance Bancorporation and Subsidiaries | |||||||||||||||||||||||||
Five Quarter Condensed Consolidated Balance Sheets | |||||||||||||||||||||||||
Unaudited | |||||||||||||||||||||||||
Dec 31, 2013 |
| Sep 30, 2013 | Jun 30, 2013 | Mar 31, 2013 | Dec 31, 2012 | ||||||||||||||||||||
(in millions) | |||||||||||||||||||||||||
Assets: | |||||||||||||||||||||||||
Cash and due from banks | $ | 305.2 | $ | 380.9 | $ | 248.9 | $ | 422.3 | $ | 204.6 | |||||||||||||||
Securities purchased under agreement to resell | -- | 128.1 | 134.0 | 134.0 | -- | ||||||||||||||||||||
Cash and cash equivalents | 305.2 | 509.0 | 382.9 | 556.3 | 204.6 | ||||||||||||||||||||
Securities and money market investments | 1,689.6 | 1,370.8 | 1,313.1 | 1,302.4 | 1,236.6 | ||||||||||||||||||||
Loans held for sale | -- | 25.4 | 27.6 | 27.9 | 31.1 | ||||||||||||||||||||
Loans held for investment: | |||||||||||||||||||||||||
Commercial | 2,478.2 | 2,234.9 | 2,174.1 | 2,084.9 | 1,947.8 | ||||||||||||||||||||
Commercial real estate - non-owner occupied | 1,841.1 | 1,864.3 | 1,839.7 | 1,538.4 | 1,505.6 | ||||||||||||||||||||
Commercial real estate - owner occupied | 1,561.9 | 1,551.2 | 1,550.0 | 1,414.3 | 1,396.8 | ||||||||||||||||||||
Construction and land development | 535.7 | 459.8 | 416.7 | 381.1 | 394.3 | ||||||||||||||||||||
Residential real estate | 350.3 | 359.0 | 381.7 | 388.7 | 407.9 | ||||||||||||||||||||
Consumer | 43.1 | 29.8 | 28.5 | 26.0 | 31.8 | ||||||||||||||||||||
Deferred fees, net | (8.9 | ) | (8.1 | ) | (6.8 | ) | (6.0 | ) | (6.0 | ) | |||||||||||||||
Gross loans and deferred fees, net | 6,801.4 | 6,490.9 | 6,383.9 | 5,827.4 | 5,678.2 | ||||||||||||||||||||
Allowance for credit losses | (100.1 | ) | (97.9 | ) | (96.3 | ) | (95.5 | ) | (95.4 | ) | |||||||||||||||
Loans, net | 6,701.3 | 6,393.0 | 6,287.6 | 5,731.9 | 5,582.8 | ||||||||||||||||||||
Premises and equipment, net | 120.2 | 105.9 | 106.1 | 107.1 | 107.9 | ||||||||||||||||||||
Other repossessed assets | 66.7 | 76.5 | 76.5 | 77.9 | 77.2 | ||||||||||||||||||||
Bank owned life insurance | 140.6 | 139.7 | 140.4 | 139.4 | 138.3 | ||||||||||||||||||||
Goodwill and other intangibles | 27.4 | 27.9 | 28.5 | 29.2 | 29.8 | ||||||||||||||||||||
Other assets | 256.1 | 273.2 | 231.0 | 202.0 | 214.3 | ||||||||||||||||||||
Total assets | $ | 9,307.1 | $ | 8,921.4 | $ | 8,593.7 | $ | 8,174.1 | $ | 7,622.6 | |||||||||||||||
Liabilities and Stockholders' Equity: | |||||||||||||||||||||||||
Liabilities: | |||||||||||||||||||||||||
Deposits: | |||||||||||||||||||||||||
Non-interest bearing demand deposits | $ | 2,200.0 | $ | 1,972.5 | $ | 1,919.6 | $ | 1,930.4 | $ | 1,933.2 | |||||||||||||||
Interest bearing: | |||||||||||||||||||||||||
Demand | 709.8 | 673.7 | 631.3 | 619.7 | 582.3 | ||||||||||||||||||||
Savings and money market | 3,310.4 | 3,050.0 | 2,945.1 | 2,826.7 | 2,573.5 | ||||||||||||||||||||
Time certificates | 1,618.0 | 1,579.1 | 1,505.3 | 1,358.1 | 1,366.2 | ||||||||||||||||||||
Total deposits | 7,838.2 | 7,275.3 | 7,001.3 | 6,734.9 | 6,455.2 | ||||||||||||||||||||
Customer repurchase agreements | 71.2 | 55.5 | 51.9 | 64.7 | 79.0 | ||||||||||||||||||||
Total customer funds | 7,909.4 | 7,330.8 | 7,053.2 | 6,799.6 | 6,534.2 | ||||||||||||||||||||
Securities sold short | -- | 126.6 | 129.5 | 132.6 | -- | ||||||||||||||||||||
Borrowings | 341.1 | 394.1 | 418.6 | 293.8 | 193.7 | ||||||||||||||||||||
Junior subordinated debt | 41.9 | 39.4 | 39.9 | 36.7 | 36.2 | ||||||||||||||||||||
Accrued interest payable and other liabilities | 159.4 | 204.2 | 153.0 | 130.1 | 98.9 | ||||||||||||||||||||
Total liabilities | 8,451.8 | 8,095.1 | 7,794.2 | 7,392.8 | 6,863.0 | ||||||||||||||||||||
Stockholders' Equity | |||||||||||||||||||||||||
Common stock and additional paid-in capital | 797.2 | 792.2 | 789.5 | 786.9 | 784.9 | ||||||||||||||||||||
Preferred stock | 141.0 | 141.0 | 141.0 | 141.0 | 141.0 | ||||||||||||||||||||
Accumulated deficit | (61.4 | ) | (92.4 | ) | (120.2 | ) | (153.8 | ) | (174.5 | ) | |||||||||||||||
Accumulated other comprehensive (loss) income | (21.5 | ) | (14.5 | ) | (10.8 | ) | 7.2 | 8.2 | |||||||||||||||||
Total stockholders' equity | 855.3 | 826.3 | 799.5 | 781.3 | 759.6 | ||||||||||||||||||||
Total liabilities and stockholders' equity | $ | 9,307.1 | $ | 8,921.4 | $ | 8,593.7 | $ | 8,174.1 | $ | 7,622.6 | |||||||||||||||
Western Alliance Bancorporation and Subsidiaries | |||||||||||||||||||||||||
Changes in the Allowance For Credit Losses | |||||||||||||||||||||||||
Unaudited | |||||||||||||||||||||||||
Three Months Ended | |||||||||||||||||||||||||
Dec 31, 2013 | Sep 30, 2013 | Jun 30, 2013 | Mar 31, 2013 | Dec 31, 2012 | |||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||
Balance, beginning of period | $ | 97,851 | $ | 96,323 | $ | 95,494 | $ | 95,427 | $ | 97,410 | |||||||||||||||
Provision for credit losses | 4,300 | -- | 3,481 | 5,439 | 11,501 | ||||||||||||||||||||
Recoveries of loans previously charged-off: | |||||||||||||||||||||||||
Commercial and industrial | 666 | 2,242 | 1,757 | 441 | 372 | ||||||||||||||||||||
Commercial real estate - non-owner occupied | 395 | 273 | 154 | 440 | 288 | ||||||||||||||||||||
Commercial real estate - owner occupied | 297 | 149 | 479 | 502 | 109 | ||||||||||||||||||||
Construction and land development | 273 | 966 | 120 | 701 | 2,033 | ||||||||||||||||||||
Residential real estate | 549 | 430 | 549 | 569 | 313 | ||||||||||||||||||||
Consumer | 179 | 726 | 11 | 14 | 63 | ||||||||||||||||||||
Total recoveries | 2,359 | 4,786 | 3,070 | 2,667 | 3,178 | ||||||||||||||||||||
Loans charged-off: | |||||||||||||||||||||||||
Commercial and industrial | 621 | 544 | 1,065 | 1,770 | 4,654 | ||||||||||||||||||||
Commercial real estate - non-owner occupied | 2,268 | 466 | 1,000 | 1,908 | 2,673 | ||||||||||||||||||||
Commercial real estate - owner occupied | 238 | 398 | 1,391 | 979 | 4,470 | ||||||||||||||||||||
Construction and land development | 686 | -- | 238 | 614 | 405 | ||||||||||||||||||||
Residential real estate | 281 | 1,138 | 2,010 | 2,493 | 1,307 | ||||||||||||||||||||
Consumer | 366 | 712 | 18 | 275 | 3,153 | ||||||||||||||||||||
Total loans charged-off | 4,460 | 3,258 | 5,722 | 8,039 | 16,662 | ||||||||||||||||||||
Net loan charge-offs (recoveries) | 2,101 | (1,528 | ) | 2,652 | 5,372 | 13,484 | |||||||||||||||||||
Balance, end of period | $ | 100,050 | $ | 97,851 | $ | 96,323 | $ | 95,494 | $ | 95,427 | |||||||||||||||
Net charge-offs (recoveries) to average loans outstanding - annualized | 0.13 | % | (0.10 | )% | 0.17 | % | 0.38 | % | 0.99 | % | |||||||||||||||
Allowance for credit losses to gross loans | 1.47 | 1.50 | 1.50 | 1.63 | 1.67 | ||||||||||||||||||||
Nonaccrual loans | $ | 75,681 | $ | 76,641 | $ | 82,899 | $ | 93,748 | $ | 104,716 | |||||||||||||||
Repossessed assets | 66,719 | 76,475 | 76,499 | 77,921 | 77,247 | ||||||||||||||||||||
Loans past due 90 days, still accruing | 1,534 | 5,456 | 3,893 | 1,640 | 1,388 | ||||||||||||||||||||
Loans past due 30 to 89 days, still accruing | 13,425 | 8,689 | 7,341 | 14,795 | 16,565 | ||||||||||||||||||||
Classified loans on accrual | 128,586 | 144,041 | 140,192 | 97,351 | 112,637 | ||||||||||||||||||||
Special mention loans | 129,965 | 137,247 | 162,482 | 125,660 | 103,550 | ||||||||||||||||||||
Western Alliance Bancorporation and Subsidiaries | ||||||||||||||||||||||||||||
Analysis of Average Balances, Yields and Rates | ||||||||||||||||||||||||||||
Unaudited | ||||||||||||||||||||||||||||
Three Months Ended December 31, | ||||||||||||||||||||||||||||
2013 | 2012 | |||||||||||||||||||||||||||
Average | Interest | Average |
Average | Interest | Average | |||||||||||||||||||||||
Interest earning assets | ($ in millions) | ($ in thousands) | ($ in millions) | ($ in thousands) | ||||||||||||||||||||||||
Loans (1) | $ | 6,515.2 | $ | 86,902 | 5.48 | % | $ | 5,450.0 | $ | 75,303 | 5.60 | % | ||||||||||||||||
Investment securities (1) | 1,488.8 | 10,137 | 3.11 | 1,329.3 | 8,794 | 3.25 | ||||||||||||||||||||||
Federal funds sold and other | 447.5 | 543 | 0.49 | 300.4 | 246 | 0.33 | ||||||||||||||||||||||
Total interest earning assets | 8,451.5 | 97,582 | 4.79 | 7,079.7 | 84,343 | 4.94 | ||||||||||||||||||||||
Non-interest earning assets | ||||||||||||||||||||||||||||
Cash and due from banks | 132.7 | 121.2 | ||||||||||||||||||||||||||
Allowance for credit losses | (98.4 | ) | (99.1 | ) | ||||||||||||||||||||||||
Bank owned life insurance | 140.0 | 137.6 | ||||||||||||||||||||||||||
Other assets | 465.6 | 364.0 | ||||||||||||||||||||||||||
Total assets | $ | 9,091.4 | $ | 7,603.4 | ||||||||||||||||||||||||
Interest-bearing liabilities | ||||||||||||||||||||||||||||
Interest-bearing deposits: | ||||||||||||||||||||||||||||
Interest-bearing transaction accounts | $ | 676.8 | $ | 360 | 0.21 | % | $ | 528.1 | $ | 301 | 0.23 | % | ||||||||||||||||
Savings and money market | 3,175.1 | 2,390 | 0.30 | 2,539.8 | 1,973 | 0.31 | ||||||||||||||||||||||
Time certificates of deposit | 1,592.4 | 1,692 | 0.43 | 1,406.9 | 1,616 | 0.46 | ||||||||||||||||||||||
Total interest-bearing deposits | 5,444.3 | 4,442 | 0.33 | 4,474.8 | 3,890 | 0.35 | ||||||||||||||||||||||
Borrowings | 414.6 | 2,717 | 2.62 | 299.6 | 2,528 | 3.38 | ||||||||||||||||||||||
Junior subordinated debt | 39.5 | 442 | 4.48 | 36.2 | 470 | 5.19 | ||||||||||||||||||||||
Total interest-bearing liabilities | 5,898.4 | 7,601 | 0.52 | 4,810.6 | 6,888 | 0.57 | ||||||||||||||||||||||
Noninterest-bearing liabilities | ||||||||||||||||||||||||||||
Noninterest-bearing demand deposits | 2,091.8 | 1,948.4 | ||||||||||||||||||||||||||
Other liabilities | 249.1 | 94.4 | ||||||||||||||||||||||||||
Stockholders' equity | 852.1 | 750.0 | ||||||||||||||||||||||||||
Total liabilities and stockholders' equity | $ | 9,091.4 | $ | 7,603.4 | ||||||||||||||||||||||||
Net interest income and margin | $ | 89,981 | 4.44 | % | $ | 77,455 | 4.55 | % | ||||||||||||||||||||
Net interest spread | 4.27 | % | 4.37 | % | ||||||||||||||||||||||||
(1) Yields on loans and securities have been adjusted to a tax equivalent basis. The taxable-equivalent adjustment was $3,728 and $3,012 for the fourth quarter ended 2013 and 2012, respectively. | ||||||||||||||||||||||||||||
Western Alliance Bancorporation and Subsidiaries | ||||||||||||||||||||||||||||
Analysis of Average Balances, Yields and Rates | ||||||||||||||||||||||||||||
Unaudited | ||||||||||||||||||||||||||||
Twelve Months Ended December 31, | ||||||||||||||||||||||||||||
2013 | 2012 | |||||||||||||||||||||||||||
Average | Interest | Average |
Average | Interest | Average | |||||||||||||||||||||||
Interest earning Assets | ($ in millions) | ($ in thousands) | ($ in millions) | ($ in thousands) | ||||||||||||||||||||||||
Loans (1) | $ | 6,136.2 | $ | 326,714 | 5.43 | % | $ | 5,110.2 | $ | 280,985 | 5.55 | % | ||||||||||||||||
Investment securities (1) | 1,342.0 | 34,403 | 3.07 | 1,385.3 | 36,802 | 3.17 | ||||||||||||||||||||||
Federal funds sold & other | 409.4 | 1,538 | 0.38 | 189.5 | 508 | 0.27 | ||||||||||||||||||||||
Total interest earnings assets | 7,887.6 | 362,655 | 4.77 | 6,685.0 | 318,295 | 4.91 | ||||||||||||||||||||||
Non-interest earning assets | ||||||||||||||||||||||||||||
Cash and due from banks | 128.5 | 116.9 | ||||||||||||||||||||||||||
Allowance for credit losses | (97.5 | ) | (98.9 | ) | ||||||||||||||||||||||||
Bank owned life insurance | 139.8 | 136.0 | ||||||||||||||||||||||||||
Other assets | 442.0 | 354.4 | ||||||||||||||||||||||||||
Total assets | $ | 8,500.4 | $ | 7,193.4 | ||||||||||||||||||||||||
Interest-bearing liabilities | ||||||||||||||||||||||||||||
Interest-bearing deposits: | ||||||||||||||||||||||||||||
Interest bearing transaction accounts | $ | 640.1 | $ | 1,407 | 0.22 | % | $ | 515.3 | $ | 1,220 | 0.24 | % | ||||||||||||||||
Savings and money market | 2,936.1 | 8,480 | 0.29 | 2,371.5 | 8,088 | 0.34 | ||||||||||||||||||||||
Time certificates of deposits | 1,488.0 | 6,448 | 0.43 | 1,359.5 | 7,486 | 0.55 | ||||||||||||||||||||||
Total interest-bearing deposits | 5,064.2 | 16,335 | 0.32 | 4,246.3 | 16,794 | 0.40 | ||||||||||||||||||||||
Borrowings | 408.6 | 11,602 | 2.84 | 369.0 | 9,310 | 2.52 | ||||||||||||||||||||||
Junior subordinated debt | 38.1 | 1,823 | 4.78 | 36.8 | 1,928 | 5.24 | ||||||||||||||||||||||
Total interest-bearing liabilities | 5,510.9 | 29,760 | 0.54 | 4,652.1 | 28,032 | 0.60 | ||||||||||||||||||||||
Noninterest-bearing liabilities | ||||||||||||||||||||||||||||
Noninterest-bearing demand deposits | 1,954.2 | 1,788.3 | ||||||||||||||||||||||||||
Other liabilities | 111.8 | 62.0 | ||||||||||||||||||||||||||
Stockholders' equity | 923.5 | 691.0 | ||||||||||||||||||||||||||
Total liabilities and stockholders' equity | $ | 8,500.4 | $ | 7,193.4 | ||||||||||||||||||||||||
Net interest income and margin | $ | 332,895 | 4.39 | % | $ | 290,263 | 4.49 | % | ||||||||||||||||||||
Net interest spread | 4.23 | % | 4.31 | % | ||||||||||||||||||||||||
(1) Yields on loans and securities have been adjusted to a tax equivalent basis. The taxable-equivalent adjustment was $13,312 and $9,738 for the twelve months ended December 31, 2013 and 2012, respectively. | ||||||||||||||||||||||||||||
Western Alliance Bancorporation and Subsidiaries | ||||||||||||||||||||||||||||||
Operating Segment Results | ||||||||||||||||||||||||||||||
Unaudited | ||||||||||||||||||||||||||||||
Western | Bank of Nevada | Torrey Pines | Other | Inter-segment |
Consolidated | |||||||||||||||||||||||||
At December 31, 2013 | (dollars in millions) | |||||||||||||||||||||||||||||
Assets | 3,551.0 | 3,426.0 | 2,258.1 | 993.1 | (921.1 | ) | 9,307.1 | |||||||||||||||||||||||
Held for sale loans | -- | -- | -- | -- | -- | -- | ||||||||||||||||||||||||
Gross loans and deferred fees, net | 2,834.3 | 2,285.6 | 1,624.5 | 57.0 | -- |
| 6,801.4 | |||||||||||||||||||||||
Less: Allowance for credit losses | (30.1 | ) | (51.0 | ) | (18.3 | ) | (0.7 | ) | -- | (100.1 | ) | |||||||||||||||||||
Loans, net | 2,804.2 | 2,234.6 | 1,606.2 | 56.3 | -- | 6,701.3 | ||||||||||||||||||||||||
Goodwill and intangible assets | 2.6 | 24.8 | -- | -- | -- | 27.4 | ||||||||||||||||||||||||
Deposits | 3,064.6 | 2,763.2 | 2,021.3 | -- | (10.9 | ) | 7,838.2 | |||||||||||||||||||||||
Borrowings | 73.9 | 200.0 | -- | 67.2 | -- | 341.1 | ||||||||||||||||||||||||
Stockholders' equity | 303.5 | 368.3 | 174.5 | 873.1 | (864.1 | ) | 855.3 | |||||||||||||||||||||||
No. of branches | 17 | 11 | 12 | -- | -- | 40 | ||||||||||||||||||||||||
No. of FTE | 292 | 393 | 230 | 136 | -- | 1,051 | ||||||||||||||||||||||||
Three Months Ended December 31, 2013: | (in thousands) | |||||||||||||||||||||||||||||
Net interest income (expense) | $ | 37,299 | $ | 30,978 | $ | 22,922 | $ | (1,218 | ) | $ | -- | $ | 89,981 | |||||||||||||||||
Provision for credit losses | 2,579 | 1,100 | 621 | -- | -- | 4,300 | ||||||||||||||||||||||||
Net interest income (expense) after provision for credit losses | 34,720 | 29,878 | 22,301 | (1,218 | ) | -- | 85,681 | |||||||||||||||||||||||
Non-interest income | 1,335 | 4,798 | 911 | (1,584 | ) | (5,618 | ) | (158 | ) | |||||||||||||||||||||
Non-interest expense | (17,655 | ) | (19,487 | ) | (13,144 | ) | (6,463 | ) | 5,618 | (51,131 | ) | |||||||||||||||||||
Income (loss) from continuing operations before income taxes | 18,400 | 15,189 | 10,068 | (9,265 | ) | -- | 34,392 | |||||||||||||||||||||||
Income tax expense (benefit) | 5,732 | 2,166 | 4,027 | (9,584 | ) | -- | 2,341 | |||||||||||||||||||||||
Income from continuing operations | 12,668 | 13,023 | 6,041 | 319 | -- | 32,051 | ||||||||||||||||||||||||
Loss from discontinued operations, net | -- | -- | -- | (701 | ) | -- | (701 | ) | ||||||||||||||||||||||
Net income (loss) | $ | 12,668 | $ | 13,023 | $ | 6,041 | $ | (382 | ) | $ | -- | $ | 31,350 | |||||||||||||||||
Twelve Months Ended December 31, 2013: | (in thousands) | |||||||||||||||||||||||||||||
Net interest income (expense) | $ | 130,219 | $ | 122,799 | $ | 85,357 | $ | (5,480 | ) | $ | -- | $ | 332,895 | |||||||||||||||||
Provision for (recovery of) credit losses | 12,500 | (4,414 | ) | 3,840 | 1,294 | -- | 13,220 | |||||||||||||||||||||||
Net interest income (expense) after provision for credit losses | 117,719 | 127,213 | 81,517 | (6,774 | ) | -- | 319,675 | |||||||||||||||||||||||
Non-interest income (1) | 15,855 | 14,181 | 2,223 | 2,741 | (17,772 | ) | 17,228 | |||||||||||||||||||||||
Non-interest expense | (63,343 | ) | (72,211 | ) | (49,020 | ) | (29,464 | ) | 17,772 | (196,266 | ) | |||||||||||||||||||
Income (loss) from continuing operations before income taxes | 70,231 | 69,183 | 34,720 | (33,497 | ) | -- | 140,637 | |||||||||||||||||||||||
Income tax expense (benefit) | 18,798 | 16,458 | 11,925 | (21,927 | ) | -- | 25,254 | |||||||||||||||||||||||
Income (loss) from continuing operations | 51,433 | 52,725 | 22,795 | (11,570 | ) | -- | 115,383 | |||||||||||||||||||||||
Loss from discontinued operations, net | -- | -- | -- | (861 | ) | -- | (861 | ) | ||||||||||||||||||||||
Net income (loss) | $ | 51,433 | $ | 52,725 | $ | 22,795 | $ | (12,431 | ) | $ | -- | $ | 114,522 | |||||||||||||||||
* Excludes discontinued operations | ||||||||||||||||||||||||||||||
(1) Includes bargain purchase gain from acquisition | ||||||||||||||||||||||||||||||
Western Alliance Bancorporation and Subsidiaries | ||||||||||||||||||||||||||||||
Operating Segment Results | ||||||||||||||||||||||||||||||
Unaudited | ||||||||||||||||||||||||||||||
Western | Bank of Nevada |
Torrey Pines | Other | Inter-segment |
Consolidated | |||||||||||||||||||||||||
At December 31, 2012 | (dollars in millions) | |||||||||||||||||||||||||||||
Assets | 2,565.1 | 3,029.1 | 2,019.8 | 902.0 | (893.4 | ) | 7,622.6 | |||||||||||||||||||||||
Held for sale loans | -- | -- | 31.1 | -- | -- | 31.1 | ||||||||||||||||||||||||
Gross loans and deferred fees, net | 2,037.1 | 2,183.3 | 1,477.1 | 23.5 | (42.8 | ) | 5,678.2 | |||||||||||||||||||||||
Less: Allowance for credit losses | (21.3 | ) | (58.2 | ) | (15.6 | ) | (0.3 | ) | -- | (95.4 | ) | |||||||||||||||||||
Loans, net | 2,015.8 | 2,125.1 | 1,461.5 | 23.2 | (42.8 | ) | 5,582.8 | |||||||||||||||||||||||
Goodwill and intangible assets | 3.5 | 26.3 | -- | -- | -- | 29.8 | ||||||||||||||||||||||||
Deposits | 2,224.2 | 2,569.1 | 1,679.3 | -- | (17.4 | ) | 6,455.2 | |||||||||||||||||||||||
Borrowings | 45.0 | -- | 110.0 | 73.7 | (35.0 | ) | 193.7 | |||||||||||||||||||||||
Stockholders' equity | 224.0 | 378.2 | 169.1 | 780.9 | (792.6 | ) | 759.6 | |||||||||||||||||||||||
No. of branches | 16 | 12 | 12 | 0 | 0 | 40 | ||||||||||||||||||||||||
No. of FTE | 254 | 400 | 233 | 95 | 0 | 982 | ||||||||||||||||||||||||
Three Months Ended December 31, 2012: | (in thousands) | |||||||||||||||||||||||||||||
Net interest income (expense) | $ | 26,745 | $ | 30,127 | $ | 22,247 | $ | (1,664 | ) | $ | -- | $ | 77,455 | |||||||||||||||||
Provision for credit losses | 1,369 | 6,532 | 3,300 | 300 | -- | 11,501 | ||||||||||||||||||||||||
Net interest income (expense) after provision for credit losses | 25,376 | 23,595 | 18,947 | (1,964 | ) | -- | 65,954 | |||||||||||||||||||||||
Non-interest income (1) | 1,546 | 5,269 | 763 | 19,959 | (3,074 | ) | 24,463 | |||||||||||||||||||||||
Non-interest expense | (13,155 | ) | (18,616 | ) | (11,349 | ) | (8,943 | ) | 3,074 | (48,989 | ) | |||||||||||||||||||
Income (loss) from continuing operations before income taxes | 13,767 | 10,248 | 8,361 | 9,052 | -- | 41,428 | ||||||||||||||||||||||||
Income tax expense (benefit) | 3,349 | 2,692 | 3,146 | (1,678 | ) | -- | 7,509 | |||||||||||||||||||||||
Income from continuing operations | 10,418 | 7,556 | 5,215 | 10,730 | -- | 33,919 | ||||||||||||||||||||||||
Loss from discontinued operations, net | -- | -- | -- | (1,804 | ) | -- | (1,804 | ) | ||||||||||||||||||||||
Net income (loss) | $ | 10,418 | $ | 7,556 | $ | 5,215 | $ | 8,926 | $ | -- | $ | 32,115 | ||||||||||||||||||
Twelve Months Ended December 31, 2012: | (in thousands) | |||||||||||||||||||||||||||||
Net interest income (expense) | $ | 98,309 | $ | 113,181 | $ | 86,653 | $ | (7,880 | ) | $ | -- | $ | 290,263 | |||||||||||||||||
Provision for credit losses | 2,584 | 35,378 | 8,582 | 300 | -- | 46,844 | ||||||||||||||||||||||||
Net interest income (expense) after provision for credit losses | 95,725 | 77,803 | 78,071 | (8,180 | ) | -- | 243,419 | |||||||||||||||||||||||
Non-interest income (1) | 6,566 | 16,401 | 3,875 | 29,684 | (11,800 | ) | 44,726 | |||||||||||||||||||||||
Non-interest expense | (49,141 | ) | (72,052 | ) | (44,841 | ) | (34,626 | ) | 11,800 | (188,860 | ) | |||||||||||||||||||
Income (loss) from continuing operations before income taxes | 53,150 | 22,152 | 37,105 | (13,122 | ) | -- | 99,285 | |||||||||||||||||||||||
Income tax expense (benefit) | 16,380 | 4,033 | 14,401 | (10,853 | ) | -- | 23,961 | |||||||||||||||||||||||
Income from continuing operations | 36,770 | 18,119 | 22,704 | (2,269 | ) | -- | 75,324 | |||||||||||||||||||||||
Loss from discontinued operations, net | -- | -- | -- | (2,490 | ) | -- | (2,490 | ) | ||||||||||||||||||||||
Net income (loss) | $ | 36,770 | $ | 18,119 | $ | 22,704 | $ | (4,759 | ) | $ | -- | $ | 72,834 | |||||||||||||||||
* Excludes discontinued operations | ||||||||||||||||||||||||||||||
(1) Includes bargain purchase gain from acquisition | ||||||||||||||||||||||||||||||
Western Alliance Bancorporation and Subsidiaries | |||||||||||||||||||||||||
Reconciliation of Non-GAAP Financial Measures (Unaudited) | |||||||||||||||||||||||||
Dec 31, 2013 | Sep 30, 2013 | Jun 30, 2013 | Mar 31, 2013 | Dec 31, 2012 | |||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||||
Total stockholders' equity | $ | 855,250 | $ | 826,287 | $ | 799,524 | $ | 781,294 | $ | 759,616 | |||||||||||||||
Less: | |||||||||||||||||||||||||
Goodwill and intangible assets | 27,374 | 27,970 | 28,568 | 29,166 | 29,763 | ||||||||||||||||||||
Total tangible stockholders' equity | 827,876 | 798,317 | 770,956 | 752,128 | 729,853 | ||||||||||||||||||||
Less: | |||||||||||||||||||||||||
Preferred stock | 141,000 | 141,000 | 141,000 | 141,000 | 141,000 | ||||||||||||||||||||
Total tangible common equity | 686,876 | 657,317 | 629,956 | 611,128 | 588,853 | ||||||||||||||||||||
Add: | |||||||||||||||||||||||||
Deferred tax | 1,452 | 1,661 | 1,870 | 2,080 | 2,289 | ||||||||||||||||||||
Total tangible common equity, net of tax | $ | 688,328 | $ | 658,978 | $ | 631,826 | $ | 613,208 | $ | 591,142 | |||||||||||||||
Total assets | $ | 9,307,095 | $ | 8,921,429 | $ | 8,593,684 | $ | 8,174,103 | $ | 7,622,637 | |||||||||||||||
Less: | |||||||||||||||||||||||||
Goodwill and intangible assets | 27,374 | 27,970 | 28,568 | 29,166 | 29,763 | ||||||||||||||||||||
Tangible assets | 9,279,721 | 8,893,459 | 8,565,116 | 8,144,937 | 7,592,874 | ||||||||||||||||||||
Add: | |||||||||||||||||||||||||
Deferred tax | 1,452 | 1,661 | 1,870 | 2,080 | 2,289 | ||||||||||||||||||||
Total tangible assets, net of tax | $ | 9,281,173 | $ | 8,895,120 | $ | 8,566,986 | $ | 8,147,017 | $ | 7,595,163 | |||||||||||||||
Tangible equity ratio (1) | 8.9 | % | 9.0 | % | 9.0 | % | 9.2 | % | 9.6 | % | |||||||||||||||
Tangible common equity ratio (2) | 7.4 | % | 7.4 | % | 7.4 | % | 7.5 | % | 7.8 | % | |||||||||||||||
Common shares outstanding | 87,186 | 87,099 | 86,997 | 87,079 | 86,465 | ||||||||||||||||||||
Tangible book value per share, net of tax (3) | $ | 7.89 | $ | 7.57 | $ | 7.26 | $ | 7.04 | $ | 6.84 | |||||||||||||||
Three Months Ended | |||||||||||||||||||||||||
Dec 31, 2013 | Sep 30, 2013 | Jun 30, 2013 | Mar 31, 2013 | Dec 31, 2012 | |||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||
Total non-interest income | $ | (158 | ) | $ | 2,625 | $ | 10,862 | $ | 3,899 | $ | 24,463 | ||||||||||||||
Less: | |||||||||||||||||||||||||
Unrealized losses on assets/liabilities measured at fair value, net | (2,618 | ) | (7 | ) | (3,290 | ) | (471 | ) | (48 | ) | |||||||||||||||
Gain on sale of subsidiary/non-controlling interest | -- | -- | -- | -- | 116 | ||||||||||||||||||||
Loss on extinguishment of debt | (1,387 | ) | |||||||||||||||||||||||
Bargain purchase gain from acquisition | -- | -- | 10,044 | -- | 17,562 | ||||||||||||||||||||
Legal settlements | -- | -- | -- | 38 | 879 | ||||||||||||||||||||
Mutual fund gains | -- | -- | -- | -- | 483 | ||||||||||||||||||||
Amortization of affordable housing investments | (1,714 | ) | (1,504 | ) | (900 | ) | (900 | ) | (1,069 | ) | |||||||||||||||
(Losses) Gains on sales of investment securities, net | 342 | (1,679 | ) | (5 | ) | 147 | 1,447 | ||||||||||||||||||
Total operating non-interest income | 5,219 | 5,815 | 5,013 | 5,085 | 5,093 | ||||||||||||||||||||
Add: net interest income | 89,981 | 84,559 | 82,152 | 76,203 | 77,455 | ||||||||||||||||||||
Net operating revenue (4) | $ | 95,200 | $ | 90,374 | $ | 87,165 | $ | 81,288 | $ | 82,548 | |||||||||||||||
Total non-interest expense | $ | 51,131 | $ | 49,675 | $ | 48,531 | $ | 46,929 | $ | 48,989 | |||||||||||||||
Less: | |||||||||||||||||||||||||
Net loss (gain) on sales and valuations of repossessed assets | (2,153 | ) | 371 | (1,124 | ) | 519 | 529 | ||||||||||||||||||
Merger / restructure expense | 1,919 | 1,018 | 2,620 | 195 | 2,706 | ||||||||||||||||||||
Total operating non-interest expense (4) | $ | 51,365 | $ | 48,286 | $ | 47,035 | $ | 46,215 | $ | 45,754 | |||||||||||||||
Net operating revenue | $ | 95,200 | $ | 90,374 | $ | 87,165 | $ | 81,288 | $ | 82,548 | |||||||||||||||
Less: | |||||||||||||||||||||||||
Operating non-interest expense | 51,365 | 48,286 | 47,035 | 46,215 | 45,754 | ||||||||||||||||||||
Pre-tax, pre-provision operating earnings (5) | $ | 43,835 | $ | 42,088 | $ | 40,130 | $ | 35,073 | $ | 36,794 | |||||||||||||||
Western Alliance Bancorporation and Subsidiaries | |||||||||||||||||||||||||
Reconciliation of Non-GAAP Financial Measures (Unaudited) | |||||||||||||||||||||||||
Three Months Ended | |||||||||||||||||||||||||
Dec 31, 2013 | Sep 30, 2013 | Jun 30, 2013 | Mar 31, 2013 | Dec 31, 2012 | |||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||
Total operating non-interest expense |
| $ | 51,365 | $ | 48,286 | $ | 47,035 | $ | 46,215 | $ | 45,754 | ||||||||||||||
Divided by: |
| ||||||||||||||||||||||||
Total net interest income |
| $ | 89,981 | $ | 84,559 | $ | 82,152 | $ | 76,203 | $ | 77,455 | ||||||||||||||
Add: |
| ||||||||||||||||||||||||
Tax equivalent interest adjustment |
| 3,728 | 3,272 | 2,929 | 3,382 | 3,012 | |||||||||||||||||||
Operating non-interest income |
| 5,219 | 5,815 | 5,013 | 5,085 | 5,093 | |||||||||||||||||||
$ | 98,928 | $ | 93,646 | $ | 90,094 | $ | 84,670 | $ | 85,560 | ||||||||||||||||
Efficiency ratio - tax equivalent basis (6) |
| 51.9 | % | 51.6 | % | 52.2 | % | 54.6 | % | 53.5 | % | ||||||||||||||
Twelve Months Ended December 31, | |||||||||||||||||||||||||
2013 | 2012 | ||||||||||||||||||||||||
Total operating non-interest expense |
| $ | 192,901 | $ | 178,399 | ||||||||||||||||||||
Divided by: |
| ||||||||||||||||||||||||
Total net interest income |
| $ | 332,895 | $ | 290,263 | ||||||||||||||||||||
Add: |
| ||||||||||||||||||||||||
Tax equivalent interest adjustment |
| 13,312 | 9,738 | ||||||||||||||||||||||
Operating non-interest income |
| 21,132 | 22,087 | ||||||||||||||||||||||
$ | 367,339 | $ | 322,088 | ||||||||||||||||||||||
Efficiency ratio - tax equivalent basis (6) |
| 52.5 | % | 55.4 | % | ||||||||||||||||||||
Three Months Ended December 31, | |||||||||||||||||||||||||
2013 | 2012 | ||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||
Stockholders' equity |
| $ | 855,250 | $ | 759,616 | ||||||||||||||||||||
Less: |
| ||||||||||||||||||||||||
Accumulated other comprehensive (loss) income |
| (21,546 | ) | 8,243 | |||||||||||||||||||||
Non-qualifying goodwill and intangibles |
| 25,991 | 27,520 | ||||||||||||||||||||||
Other non-qualifying assets |
| -- | 2 | ||||||||||||||||||||||
Disallowed unrealized losses on equity securities |
| 8,059 | -- | ||||||||||||||||||||||
Add: |
| ||||||||||||||||||||||||
Qualifying trust preferred securities |
| 48,485 | 44,819 | ||||||||||||||||||||||
Tier 1 capital (regulatory) (7) (10) |
| 891,231 | 768,670 | ||||||||||||||||||||||
Less: |
| ||||||||||||||||||||||||
Qualifying non-controlling interests |
| -- | -- | ||||||||||||||||||||||
Qualifying trust preferred securities |
| 48,485 | 44,819 | ||||||||||||||||||||||
Preferred stock |
| 141,000 | 141,000 | ||||||||||||||||||||||
Estimated Tier 1 common equity (8) (10) |
| $ | 701,746 | $ | 582,851 | ||||||||||||||||||||
Divided by: |
| ||||||||||||||||||||||||
Estimated risk-weighted assets (regulatory (8) (10) |
| $ | 7,845,866 | $ | 6,797,170 | ||||||||||||||||||||
Tier 1 common equity ratio (8) (10) |
| 8.9 | % | 8.6 | % | ||||||||||||||||||||
December 31, | |||||||||||||||||||||||||
2013 | 2012 | ||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||
Classified assets |
| $ | 270,375 | $ | 294,519 | ||||||||||||||||||||
Divide: |
| ||||||||||||||||||||||||
Tier 1 capital (regulatory) (7) (10) |
| 891,231 | 768,670 | ||||||||||||||||||||||
Plus: Allowance for credit losses |
| 100,050 | 95,427 | ||||||||||||||||||||||
Total Tier 1 capital plus allowance for credit losses |
| $ | 991,281 | $ | 864,097 | ||||||||||||||||||||
Classified assets to Tier 1 capital plus allowance (9) (10) |
| 27 | % | 34 | % | ||||||||||||||||||||
(1) We believe this non-GAAP ratio provides a critical metric with which to analyze and evaluate financial condition and capital strength. | |||||||||||||||||||||||||
(2) We believe this non-GAAP ratio provides a critical metric with which to analyze and evaluate financial condition and capital strength. | |||||||||||||||||||||||||
(3) We believe this non-GAAP ratio improves the comparability to other institutions that have not engaged in acquisitions that resulted in recorded goodwill and other intangibles. | |||||||||||||||||||||||||
(4) We believe these non-GAAP measurements provide a useful indication of the cash generating capacity of the Company. | |||||||||||||||||||||||||
(5) We believe this non-GAAP measurement is a key indicator of the earnings power of the Company. | |||||||||||||||||||||||||
(6) We believe this non-GAAP ratio provides a useful metric to measure the operating efficiency of the Company. | |||||||||||||||||||||||||
(7) Under the guidelines of the Federal Reserve and the Federal Deposit Insurance Corporation in effect, Tier 1 capital consisted of common stock, retained earnings, non-cumulative perpetual preferred stock, trust preferred securities up to a certain limit, and minority interests in certain subsidiaries, less most other intangible assets. | |||||||||||||||||||||||||
(8) Tier 1 common equity is often expressed as a percentage of risk-weighted assets. Under the risk-based capital framework, a bank's balance sheet assets and credit equivalent amounts of off-balance sheet items are assigned to one of four broad risk categories. The aggregated dollar amount in each category is then multiplied by the risk weighting assigned to that category. The resulting weighted values from each of the four categories are added together and this sum is the risk-weighted assets total that, as adjusted, comprises the denominator (risk-weighted assets) to determine the Tier 1 capital ratio. Adjustments are made to Tier 1 capital to arrive at Tier 1 common equity. Tier 1 common equity is divided by the risk-weighted assets to determine the Tier 1 common equity ratio. We believe this non-GAAP ratio provides a critical metric with which to analyze and evaluate financial condition and capital strength. | |||||||||||||||||||||||||
(9) We believe this non-GAAP ratio provides a critical regulatory metric in which to analyze asset quality. | |||||||||||||||||||||||||
(10) Current quarter is preliminary until Call Reports are filed. | |||||||||||||||||||||||||
Western Alliance Bancorporation
Dale Gibbons, 602-952-5476