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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) - January 20, 2000
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HUDSON UNITED BANCORP
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(Exact Name of Registrant as Specified in Charter)
NEW JERSEY
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(State or Other Jurisdiction of Incorporation)
1-10699 22-2405746
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(Commission File Number) (IRS Employer Identification No.)
1000 MacArthur Boulevard, Mahwah, New Jersey 07430
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(Address of Principal Executive Offices)
(201) 236-2600
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(Registrant's Telephone Number)
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<PAGE>
Item 5. Other Events
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On January 20, 2000, the Registrant issued a press release announcing
its fourth quarter and full year 1999 financial results, which included a
special charge for the fourth quarter 1999. Copies of the press release are
attached as Exhibit 99 to this Current Report on Form 8-K and incorporated by
reference herein.
Item 7. Exhibits
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Exhibit 99 - Press Release dated January 20, 2000.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registration has duly caused this report to be signed on its behalf by the
undersigned thereto duly authorized.
HUDSON UNITED BANCORP
CHRIS A. McFADDEN
Dated: January 20, 2000 By: ______________________________
Chris A. McFadden
Senior Vice President & CFO
<PAGE>
Index to Exhibits
Exhibit 99 - Press Release dated January 20, 2000.
Hudson United Bancorp
1000 MacArthur Blvd.
Mahwah, NJ 07430
(NYSE:HU)
AT THE COMPANY:
Kenneth T. Neilson Chris A. McFadden
Chairman, President & CEO Senior Vice President & CFO
(201) 236-2631 (201) 236-6144
FOR IMMEDIATE RELEASE
January 20, 2000
Hudson United Bancorp Reports 27% Increase in Operating Earnings Per
Share for the Fourth Quarter
Mahwah, New Jersey, January 20, 2000 --Hudson United Bancorp (NYSE:HU)
today reported fourth quarter operating earnings of $30.3 million or $0.57 per
share on a diluted basis, compared with net income of $24.4 million or $0.45 per
diluted share for the same period in 1998. The Company had a net loss of $17.6
million for the 1999 fourth quarter which resulted from charges taken related to
the JeffBanks, Inc. and Southern Jersey Bancorp acquisitions. The charges
consisted of a $33.0 million pre-tax special provision for loan losses to
conform the reserve policies of the two institutions to that of the Company and
$37.2 million pre-tax in merger related restructuring costs (collectively the
"special charges"). Excluding the special charges, return on average assets was
1.24% and return on average equity was 21.86% for the 1999 fourth quarter.
"Our operating earnings for the fourth quarter reflect a continuation
of our strong financial performance," said Ken Neilson, Hudson United Bancorp's
Chairman, President and CEO. "As we enter the new year, we are well positioned
to continue to grow our businesses and improve our profitability."
For the year ended December 31, 1999, operating earnings were $117.2
million and diluted earnings per share was $2.20. Net income for the full year
1999, including the special charges, was $69.3 million, or $1.30 per diluted
share. Operating earnings for the full year 1998 were $90.4 million and diluted
earnings per share was $1.64. Net income for the year ended December 31, 1998
amounted to $26.8 million, or $0.49 per diluted share. The 1998 period included
a loss on assets held for sale of $23.3 million pre-tax and merger related
restructuring costs of $69.7 million pre-tax (collectively the "special
charges"). For the full year 1999, excluding special charges, return on average
assets was 1.27% and return on average equity was 20.20%. These results do not
reflect the benefit of cost saves related to the two acquisitions which will be
fully realized with the computer conversions in the first quarter of 2000.
During the fourth quarter of 1999, the Company completed its
acquisition of assets and liabilities of Advest Bank and Trust and consummated a
strategic partnership with Advest, Inc. In addition, the acquisitions of Lyon
Credit Corporation, JeffBanks, Inc., and Southern Jersey Bancorp were completed.
The Jeffbanks and Southern Jersey acquisitions were accounted for using the
pooling method of accounting and therefore results for the 1999 and 1998 prior
periods have been restated.
Net interest income for the fourth quarter of 1999 was $87.4 million
compared to $81.3 million for the fourth quarter of 1998. The net interest
margin was 3.92% and 4.01% for the fourth quarter of 1999 and 1998,
respectively. For the year ended December 31, 1999, net interest income was
$343.1 million and the net interest margin was 4.04%. For the same period in
1998, net interest income was $328.9 million and the net interest margin was
4.10%. The higher net interest income in the 1999 periods compared to 1998 was
primarily due to an increased level of interest-earning assets.
Total noninterest income was $25.1 million and $89.9 million for the
fourth quarter and full year of 1999, respectively. This compares to $18.6
million and $70.9 million reported for the same periods in 1998. Noninterest
income as a percent of total net revenue was 22% for the fourth quarter of 1999,
up from 19% in the fourth quarter of 1998. The major factors behind the growth
in the quarterly and annual periods was higher income from Shoppers Charge and
mortgage divisions and increased sales of alternative investment products.
Noninterest expenses, excluding special charges, for the fourth quarter
of 1999 were $61.2 million compared to $57.3 million in the fourth quarter of
1998. The increase in expenses was more than offset by higher revenue as the
fourth quarter 1999 efficiency ratio of 50.7% compared favorably to the 51.7%
efficiency ratio in the same period last year. The efficiency ratio is expected
to improve as a result of the cost savings anticipated to be achieved in the
first quarter of 2000. Noninterest expenses, excluding special charges, for the
full year of 1999 were $239.3 million compared to $232.4 million for the same
1998 period. The efficiency ratio for full year 1999 was 51.1% compared to 53.7%
for 1998. The increases in noninterest expenses for both periods reflect the
higher cost of supporting our expanding business lines. Including special
charges, noninterest expenses for the fourth quarter and full year 1999 were
$98.4 and $276.4 million, respectively. For the full year 1998, including
special charges, noninterest expenses amounted to $301.5 million.
At December 31, 1999, non-performing assets totaled $53.1 million
(0.55% of total assets) compared to $60.0 million at December 31, 1998. The
allowance for possible loan losses totaled $98.7 million at year-end 1999 and
represented 201% of non-performing loans and 1.74% of total loans. At December
31, 1998, the allowance for possible loan losses totaled $76.0 million and was
147% of non-performing loans and 1.56% of total loans. The provision for
possible loan losses was $37.9 million and $52.2 million for the fourth quarter
and full year 1999, respectively. Both periods reflect the $33.0 million special
provision for loan losses mentioned earlier. For the 1998 fourth quarter and
full year, the provision for loan losses was $11.2 million and $35.6 million,
respectively.
Hudson United Bancorp's total assets at December 31, 1999 were $9.7
billion compared to $8.9 billion at year-end 1998. At 1999 year-end, total loans
were $5.7 billion and total deposits were $6.5 billion. At year-end 1998, total
loans amounted to $4.9 billion and total deposits amounted to $6.8 billion.
Total stockholders' equity was $519 million and book value per common share was
$10.00 at December 31, 1999. All regulatory capital ratios exceed those
necessary to be considered a well-capitalized institution.
Hudson United Bancorp is the multi-state bank holding company for
Hudson United Bank which has over 200 offices in New Jersey, New York,
Connecticut and Pennsylvania.
In September, Hudson United Bancorp and Dime Bancorp, Inc. announced the
signing of a definitive agreement to merge. The agreement provides for the
combined company to be known as Dime United Bancorp, Inc., a bank holding
company. The principal subsidiary is to be a commercial bank, named DimeBank.
Each share of Hudson United Bancorp will be converted into one share of Dime
United Bancorp, Inc. Subject to certain conditions, including shareholder and
regulatory approvals, the transaction is expected to close in the first quarter
of 2000.
This release contains forward-looking statements within the meaning of
the Private Securities Litigation Reform Act of 1995. Forward-looking statements
can be identified by the use of words such as "believes", "expects", and similar
words or variations. Such statements are not historical facts and involve
certain risks and uncertainties. Actual results may differ materially from the
results discussed in these forward-looking statements. Factors that may cause a
difference include, but are not limited to, changes in interest rates, economic
conditions, deposit and loan growth, loan loss provisions, customer retention,
failure to realize expected cost savings or revenue enhancements from
acquisitions, or failure of the company's Year 2000 compliance program to
effectively address Year 2000 computer problems. Hudson United Bancorp assumes
no obligation for updating any such forward-looking statements at any time.
<PAGE>
<TABLE>
<CAPTION>
Hudson United Bancorp
Financial Highlights
(In thousands, except per share data)
Three Months Ended
December 31,
INCOME STATEMENT 1999 1999(1) 1998
- ----------------- ---- ------- ----
<S> <C> <C> <C>
Net Interest Income ......................... $ 87,409 $ 87,409 $ 81,281
Provision for Possible Loan Losses .......... 4,910 4,910 11,190
Special Provision for Loan Losses ........... 33,000 -- --
Noninterest Income .......................... 25,134 25,134 18,632
Security Gains (Losses) ..................... (98) (98) 718
Noninterest Expense ......................... 61,208 61,208 57,346
Merger Related and Restructuring Costs ...... 37,193 -- --
Pretax Income (Loss) ........................ (23,866) 46,327 32,095
Tax Expense (Benefit) ....................... (6,315) 16,024 7,687
-------- -------- --------
Net Income (Loss) ........................... $(17,551) $ 30,303 $ 24,408
======== ======== ========
Basic Earnings (Loss) Per Share ..... $ (.34) $ .58 $ .46
Diluted Earnings (Loss) Per Share ... (.34) .57 .45
Return on Average Assets ............ (0.72)% 1.24% 1.10%
Return on Average Equity ............ (12.66)% 21.86% 15.75%
Weighted Average Shares - Basic (2) . 52,240 52,240 53,122
Weighted Average Shares - Diluted (2) 52,240 52,903 54,605
</TABLE>
(1)Excludes special provision for loan losses and merger related and
restructuring costs.
(2) Weighted Average Shares Outstanding have been retroactively adjusted for the
effects of acquisitions accounted for as poolings of interest, stock dividends
and stock splits.
<PAGE>
<TABLE>
<CAPTION>
Hudson United Bancorp
Financial Highlights
(In thousands, except per share data)
Year Ended December 31,
INCOME STATEMENT 1999 1998
---- ----
(INCLUDING SPECIAL CHARGES)(1)
<S> <C> <C>
Net Interest Income .............................. $343,066 $328,850
Provision for Possible Loan Losses ............... 19,200 35,607
Special Provision for Loan Losses ................ 33,000 --
Noninterest Income ............................... 89,862 70,852
Security Gains ................................... 3,998 5,137
Loss on Assets Held for Sale ..................... -- 23,303
Noninterest Expense .............................. 239,256 232,445
Merger Related and Restructuring Costs ........... 37,193 69,749
Pretax Income .................................... 108,277 43,735
Tax Expense ...................................... 38,939 16,984
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Net Income ....................................... $ 69,338 $ 26,751
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Basic Earnings Per Share ..................... $ 1.33 $ .50
Diluted Earnings Per Share ................... 1.30 .49
Return on Average Assets ..................... 0.75% 0.31%
Return on Average Equity ..................... 11.95% 4.14%
Weighted Average Shares - Basic (2) .......... 52,241 53,380
Weighted Average Shares - Diluted (2) ........ 53,242 55,153
</TABLE>
(1)Includes special provision for loan losses and merger related and
restructuring costs in 1999. Includes loss on assets held for sale and merger
related and restructuring costs in 1998.
(2) Weighted Average Shares Outstanding have been retroactively adjusted for the
effects of acquisitions accounted for as poolings of interest, stock dividends
and stock splits.
<PAGE>
<TABLE>
<CAPTION>
Hudson United Bancorp
Financial Highlights
(In thousands, except per share data)
Year Ended December 31,
INCOME STATEMENT 1999 1998
---- ----
(EXCLUDING SPECIAL CHARGES)(1)
<S> <C> <C>
Net Interest Income ............................ $343,066 $328,850
Provision for Possible Loan Losses ............. 19,200 35,607
Noninterest Income ............................. 89,862 70,852
Security Gains ................................. 3,998 5,137
Noninterest Expense ............................ 239,256 232,445
Pretax Income .................................. 178,470 136,787
Tax Expense .................................... 61,278 46,402
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Net Income ..................................... $117,192 $ 90,385
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Basic Earnings Per Share ....................... $ 2.24 $ 1.69
Diluted Earnings Per Share ..................... 2.20 1.64
Return on Average Assets ....................... 1.27% 1.04%
Return on Average Equity ....................... 20.20% 13.97%
Weighted Average Shares - Basic (2) ............ 52,241 53,380
Weighted Average Shares - Diluted (2) .......... 53,242 55,153
</TABLE>
(1)Excludes special provision for loan losses and merger related and
restructuring costs in 1999. Excludes loss on assets held for sale and merger
related and restructuring costs in 1998.
(2) Weighted Average Shares Outstanding have been retroactively adjusted for the
effects of acquisitions accounted for as poolings of interest, stock dividends
and stock splits.
<PAGE>
<TABLE>
<CAPTION>
Hudson United Bancorp
Financial Highlights
(In thousands)
12/31/99 12/31/98
<S> <C> <C>
SELECTED BALANCE SHEET DATA AT PERIOD-END
Loans ................................................... $5,679,581 $4,885,643
Allowance for Loan Losses ............................... 98,749 76,043
Loans, net of the Allowance for Loan Losses ............. 5,580,832 4,809,600
Investment Securities ................................... 3,366,526 3,295,956
Interest-Earning Assets ................................. 9,046,107 8,266,996
Total Assets ............................................ 9,686,286 8,897,775
Deposits ................................................ 6,455,345 6,773,236
Borrowings .............................................. 2,383,666 970,410
Long Term Debt .......................................... 257,300 257,300
Stockholders' Equity .................................... 519,166 619,925
SELECTED AVERAGE BALANCE SHEET DATA FOR THE QUARTER ENDED
Loans ................................................... $5,500,403 $4,885,831
Interest-Earning Assets ................................. 9,001,259 8,216,557
Deposits ................................................ 6,510,626 6,846,225
Total Assets ............................................ 9,667,629 8,818,887
Common Equity ........................................... 550,006 614,841
SELECTED AVERAGE BALANCE SHEET DATA FOR YEAR ENDED
Loans ................................................... $5,136,467 $4,923,410
Interest-Earning Assets ................................. 8,644,418 8,147,072
Deposits ................................................ 6,596,220 6,879,120
Total Assets ............................................ 9,248,141 8,721,572
Common Equity ........................................... 580,238 646,789
</TABLE>
