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) July 27, 2000
FirstFed Financial Corp.
(Exact name of registrant as specified in its charter)
Delaware 1-9566 95-4087449
(State of Incorporation) (Commission File No.) (IRS Employer
Identification No.)
401 Wilshire Boulevard, Santa Monica, California, 90401-1490
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (310)319-6000
Total number of pages is 9
Index to Exhibit is on Page 3.
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Item 5. Other Events.
On July 27, 2000, the registrant, FirstFed Financial Corp., issued a press
release. A copy of this press release is attached and incorporated herein
as Exhibit 99.
Item 7. Financial Statements and Exhibits
a) Financial Statements of businesses acquired.
Not applicable.
b) Pro forma financial information.
Not applicable.
c) Exhibits
99. Press release dated July 27, 2000.
S I G N A T U R E S
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
FIRSTFED FINANCIAL CORP.
Dated: July 27, 2000 By:/S/ Douglas J. Goddard
-------------------------
Douglas J. Goddard
Chief Financial Officer
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INDEX TO EXHIBITS
Item Page
99 Press Release dated July 27, 2000 4
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FIRSTFED REPORTS RESULTS FOR THE SECOND QUARTER OF 2000
Santa Monica, California, July 27, 2000 --FirstFed
Financial Corp. (NYSE-FED), parent company of First
Federal Bank of California, today announced net
earnings of $9.4 million or 54 cents per share of
common stock for the second quarter of 2000, compared
to $9.1 million or 47 cents per share for the second
quarter of 1999. Quarterly earnings increased compared
to last year due to growth in net interest income and
decreased legal expenses. Decreased gain on sale of
loans and lower income from real estate operations
offset the increased earnings. All per-share earnings
are presented on a diluted basis.
Net earnings for the first six months of 2000 were
$18.2 million or $1.03 per share, compared to $18.0
million or $0.90 per share for the first six months of
1999. The increase in net earnings resulted from the
same factors that affected second quarter earnings.
Net interest income increased during the second
quarter and first six months of 2000 due to growth in
average interest-earning assets and $501 thousand in
additional dividends received from the Federal Home
Loan Bank of San Francisco. Loan originations for both
the second quarter and first six months of 2000 grew as
a result of increased borrower demand for adjustable
rate loans that the Bank typically maintains in its
portfolio. Also, the Bank purchased $125.2 million in
loans at the end of the first quarter of 2000 in
conjunction with the acquisition of two retail branches
with deposits totaling $168.5 million. As a result,
average interest-earning assets increased to $3.9
billion and $3.8 billion during the second quarter and
first six months of 2000 from $3.5 billion during both
the second quarter and first six months of 1999.
Gain on sale of loans decreased during the second
quarter and first six months of 2000 due to a lower
volume of loans sold. Borrower demand for fixed rate
loans originated for sale by the Bank decreased due to
higher interest rates on those mortgages.
Income from real estate operations decreased during
the second quarter and first six months of 2000 due to
decreased levels of foreclosed real estate during the
periods. The Bank's level of foreclosures and
delinquencies has continued to improve as a result of
the strong Southern California economy and real estate
market. Non-performing assets were 0.27% of total
assets as of June 30, 2000, compared to 0.40% of total
assets as of December 31, 1999 and 0.45% of total
assets as of June 30, 1999.
The Company recorded net loan loss recoveries of
$219 thousand and $786 thousand for the second quarter
and first six months of 2000 respectively. In
comparison, net loan charge-offs were $764 thousand and
$1.2 million for the second quarter and first six
months of 1999, respectively. The Company's general
valuation allowance was $71.9 million or 1.93% of loans
and real estate owned as of June 30, 2000, compared to
$70.3 million or 2.15% as of December 31, 1999 and
$68.6 million or 2.28% at June 30, 1999.
The ratio of non-interest expense to average assets
decreased to 1.22% for the second quarter of 2000 from
1.38% for the comparable 1999 period. The ratio
decreased to 1.23% for the first six months of 2000
from 1.37% for the first six months of 1999. The
decreased ratios were attributable to growth in average
assets, and a decline in legal expenses.
The Company repurchased 821,500 shares of its
common stock at an average price of $12.39 during the
first six months of 2000. As of June 30, 2000,
889,016 shares remain eligible for repurchase under the
Company's authorized repurchase program.
At June 30, 2000, First Federal Bank met the
capital requirements necessary to be deemed
"well-capitalized" for regulatory capital purposes. It
has 26 full-service retail banking offices and 4 retail
loan offices.
KEY FINANCIAL RESULTS FOLLOW
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<CAPTION>
FIRSTFED FINANCIAL CORP.
AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(Dollars in thousands, except per share data)
(Unaudited)
June 30, December 31,
ASSETS 2000 1999
<S> <C> <C>
Cash and cash equivalents $55,867 $101,807
Investment securities,
available-for-sale (at fair value) 147,428 151,195
Mortgage-backed securities,
available-for-sale (at fair value) 391,214 428,641
Loans receivable, held-for-sale
fair value of $1,245 and $2,324) 1,245 2,303
Loans receivable, net 3,458,146 3,058,244
Accrued interest and dividends receivable 25,038 21,825
Real estate 2,153 2,236
Office properties and equipment, net 11,349 11,745
Investment in Federal Home Loan Bank
(FHLB) stock, at cost 74,700 71,722
Other assets 15,792 6,787
$4,182,932 $3,856,505
LIABILITIES
Deposits $2,141,868 $2,061,357
FHLB advances and other borrowings 1,454,000 1,169,000
Securities sold under agreements to
repurchase 327,610 363,635
Accrued expenses and other liabilities 22,873 31,380
3,946,351 3,625,372
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY
Common stock, par value $.01 per share;
authorized 100,000,000 shares; issued 23,274,263
and 23,269,051 shares, outstanding
17,206,773 and 18,023,061 shares 233 233
Additional paid-in capital 31,598 31,561
Retained earnings - substantially restricted 293,132 274,946
Loan to employee stock ownership plan (1,806) (1,759)
Treasury stock, at cost,
6,067,490 and 5,245,990 shares (75,743) (65,568)
Accumulated other comprehensive loss,
net of taxes (10,833) (8,280)
236,581 231,133
$4,182,932 $3,856,505
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<CAPTION>
FIRSTFED FINANCIAL CORP.
AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE EARNINGS
(Dollars in thousands, except per share data)
Three Months Ended Six Months Ended
June 30, June 30,
2000 1999 2000 1999
<S> <C> <C> <C> <C>
Interest income:
Interest on loans $ 66,487 $ 53,324 $127,613 $107,331
Interest on mortgage-backed
securities 6,096 7,043 12,238 14,652
Interest and dividends on investments 3,872 3,330 7,706 6,451
Total interest income 76,455 63,697 147,557 128,434
Interest expense:
Interest on deposits 24,508 21,268 47,638 43,932
Interest on borrowings 25,780 17,210 47,772 34,118
Total interest expense 50,288 38,478 95,410 78,050
Net interest income 26,167 25,219 52,147 50,384
Provision for loan losses - - - -
Net interest income
after provision for losses 26,167 25,219 52,147 50,384
Other income:
Loan and other fees 794 1,099 1,532 2,384
Gain on sale of loans 38 504 3 1,087
Real estate operations, net 476 1,526 438 1,828
Other operating income 1,110 1,028 2,170 1,991
Total other income 2,418 4,157 4,143 7,290
Non-interest expense
Compensation 6,809 6,637 13,439 13,627
Occupancy 2,021 1,991 3,977 3,889
Goodwill amortization 399 121 425 242
Other expenses 3,341 4,364 6,974 7,943
Total non-interest expense 12,570 13,113 24,815 25,701
Earnings before income taxes 16,015 16,263 31,475 31,973
Income tax provision 6,664 7,160 13,289 13,955
Net earnings $9,351 $9,103 $18,186 $18,018
Other comprehensive loss,
net of taxes (42) (7,302) (2,553) (6,676)
Comprehensive earnings $9,309 $ 1,801 $15,633 $11,342
Earnings per share:
Basic $ 0.54 $ 0.47 $ 1.04 $ 0.90
Diluted $ 0.54 $ 0.47 $ 1.03 $ 0.90
Weighted average shares outstanding:
Basic 17,225,285 19,331,157 17,522,641 19,939,106
Diluted 17,330,584 19,529,207 17,629,206 20,118,593
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KEY FINANCIAL RESULTS ARE HIGHLIGHTED BELOW
Quarter Ended June 30,
2000 1999
(Dollars in thousands, except per share data)
<S> <C> <C>
End of period:
Total assets $4,182,932 $ 3,628,584
Cash and securities $ 203,295 $ 263,762
Mortgage-backed securities $ 391,214 $ 480,727
Loans $3,459,391 $ 2,768,246
Goodwill $ 10,843 $ 1,058
Deposits $2,141,868 $ 2,012,504
Borrowings $1,781,610 $ 1,340,100
Stockholders' equity $ 236,581 $ 236,105
Book value per share $ 13.75 $ 12.22
Tangible book value per share $ 13.12 $ 12.16
Stock price (period-end) $ 14.13 $ 19.25
Total loan servicing portfolio $4,279,167 $ 3,749,823
Loans serviced for others $ 346,594 $ 403,403
% of Adjustable mortgages 92.80% 92.59%
Other data:
Employees (full-time equivalent) 466 472
Branches 26 24
Loan Offices 4 6
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<CAPTION>
Quarter Ended June 30,
2000 1999
(Dollars in thousands)
<S> <C> <C>
Asset quality:
Real estate (foreclosed) $ 2,120 $ 3,981
Non-accrual loans $ 8,976 $ 12,171
Non-performing assets $ 11,096 $ 16,152
Non-performing assets to
total assets 0.27% 0.45%
General valuation allowance(GVA) $ 71,895 $ 68,637
GVA to assets with loss exposure * 1.93% 2.28%
Loans sold with recourse $ 157,613 $ 192,601
GVA for loans sold with recourse $ 12,824 $ 12,824
GVA to loans sold with recourse 8.14% 6.66%
Modified loans (notimpaired) $ 917 $ 4,374
Impaired loans, net $ 10,000 $ 12,275
Allowance for impaired loans $ 1,792 $ 5,644
Capital ratios:
Tangible capital ratio 5.51% 7.85%
Core capital ratio 5.51 7.85
Risk-based capital ratio 10.94 14.88
Net worth to assets ratio 5.66 6.51
* Primarily the Bank's loans receivable
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<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
2000 1999 2000 1999
<S> <C> <C> <C> <C>
Selected ratios:
Expense ratios:
Efficiency ratio 44.03% 45.41% 44.09% 45.42%
Expense-to-average-assets
ratio 1.22 1.38 1.23 1.37
Return on average assets 0.91 0.96 0.90 0.96
Return on average equity 16.06 15.43 15.66 14.83
Yields earned and rates paid:
Average yield on loans and
mortgage-backed securities 7.64% 7.39% 7.61% 7.43%
Average yield on investment
portfolio ** 5.89 5.14 6.04 5.03
Average yield on all interest-
earning assets ** 7.57 7.27 7.54 7.30
Average rate paid on deposits 4.59 4.13 4.54 4.20
Average rate paid on borrowings 6.20 5.47 6.05 5.54
Average rate paid on all
interest-bearing liabilities 5.29 4.64 5.19 4.70
Interest rate spread 2.28 2.63 2.35 2.60
Effective net spread 2.44 2.80 2.53 2.77
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<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
Averages: 2000 1999 2000 1999
<S> <C> <C> <C> <C>
Average loans
and mortgage-backed
securities $3,786,079 $3,272,833 $3,657,015 $3,289,283
Average investments *** 157,131 180,659 170,311 182,420
Average interest-earning
assets *** 3,943,210 3,453,492 3,827,326 3,471,703
Average deposits 2,146,295 2,063,939 2,109,439 2,109,079
Average borrowings 1,670,431 1,261,228 1,585,304 1,240,162
Average interest-bearing
liabilities 3,816,726 3,325,167 3,694,743 3,349,241
Excess of interest-earning
assets over interest-bearing
liabilities $ 126,484 $ 128,325 $ 132,583 $ 122,462
Loan originations $ 286,888 $ 210,879 $ 626,086 $ 406,125
** Excludes FHLB stock dividends and other miscellaneous items.
*** Excludes FHLB stock.
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