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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) April 28, 1997
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Statewide Financial Corp.
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(Exact name of registrant as specified in its charter)
New Jersey 0-26546 22-3397900
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(State or other jurisdiction of (Commission (IRS Employer
incorporation) File Number) Identification No.)
70 Sip Avenue, Jersey City, New Jersey 07306
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (201) 795-4000
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Item 1. Changes in Control of Registrant.
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Not Applicable.
Item 2. Acquisition or Disposition of Assets.
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Not Applicable.
Item 3. Bankruptcy or Receivership.
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Not Applicable.
Item 4. Changes in Registrant's Certifying Accountant.
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Not Applicable.
Item 5. Other Events.
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Registrant issued a press release on Monday, April 28, 1997
announcing the Registrant's first quarter earnings.
Item 6. Resignations of Registrant's Directors.
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Not Applicable.
Item 7. Exhibits and Financial Statements.
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Exhibit No. Description
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99 Press Release dated Monday,
April 28, 1997, announcing
Registrant's first quarter
earnings.
Item 8. Change in fiscal year
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Not Applicable.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, Statewide Financial Corp. has duly caused this report to be
signed on its behalf by the undersigned thereunto duly authorized.
STATEWIDE FINANCIAL CORP.
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(Registrant)
Dated: April 29, 1997 By: Bernard F. Lenihan
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Senior Vice President and
Chief Financial Officer
EXHIBIT INDEX
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CURRENT REPORT ON FORM 8-K
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Exhibit No. Description
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99 Press Release dated Monday, April 28, 1997,
announcing Registrant's first quarter earnings.
FOR IMMEDIATE RELEASE CONTACT: Augustine F. Jehle
April 28, 1997 201-795-4000
Anthony S. Cicatiello
908-382-1066
Statewide Financial Corp. Reports 15 Percent Increase
In First Quarter 1997 Net Income
JERSEY CITY, N.J., April 28, 1997 -- Statewide Financial Corp.
(NASDAQ: SFIN), the holding company for Statewide Savings Bank S.L.A.,
today reported net income of $1,384,000, or $0.32, per share for the
quarter ended March 31, 1997 as compared to $1,205,000, or $0.25, per
share for the same quarter during 1996, and $1,305,000, or $0.29, for
the quarter ended December 31, 1996. This represents an increase in
net income of 15% and 6% over March 31, 1996 and December 31, 1996,
respectively.
"We are very pleased by this improvement in our quarterly results,"
stated Victor M. Richel, chairman, president and chief executive
officer. "Our core deposit base continues to grow as a result of our
marketing initiatives as we make our presence known and continue to
pursue our goal of becoming the premier community bank in our market
region."
The Company's emphasis on multi-family and commercial mortgage and
commercial business lending throughout 1996 and the first quarter of
1997 contributed to higher net interest margin, which grew to 3.78%
for the first quarter of 1997, from 3.65% for the fourth quarter of
1996, and from 3.44% for the first quarter of 1996.
During the first quarter of 1997, the Company continued to change its
mix within its loan portfolio to higher yielding loans. The
commercial loan and commercial and multi-family mortgage portfolio
increased $6.6 million, or 25% during the quarter, to $32.8 million
from $26.2 million at December 31, 1996. Also during the quarter,
yields on the Company's investment portfolio increased over the
preceding quarter, as a result of mortgage-backed securities purchased
in the fourth quarter of 1996 and the first quarter of 1997.
Specifically, during the quarter the Company's mortgage-backed
securities portfolio increased $37.7 million to $278.7 million at
March 31, 1997 from $241.0 million at December 31, 1996. This
increase was the principal component of the growth in the Company's
total assets, which increased from $636.0 million at December 31, 1996
to $677.4 million at March 31, 1997, a use of $41.3 million, or 6.5%.
This growth in the Company's total assets was funded primarily with
borrowed funds, as the Company continued with its strategy of
leveraging its excess capital. Borrowed funds at March 31, 1997
totaled $150.2 million, an increase of $43.0 million over December 31,
1996. Of this amount, $90.2 million matures within ninety days. The
Company's intention is to keep these maturities short term, subject to
prevailing interest rates, at least into the third quarter of 1997.
The average cost of borrowed funds was 5.57% for the three months
ended March 31, 1997 as compared to 5.61% for the preceding quarter.
Deposits totaled $458.7 million at March 31, 1997, an increase of $1.6
million over December 31, 1996. During the quarter, the mix of
deposits has changed. Higher costing certificates of deposit accounts
have been decreasing and replaced with lower-yielding core deposits.
During the first quarter, core deposits increased $3.0 million while
certificates of deposits decreased $1.4 million. "As we expand in our
market area and focus on our cross-selling efforts, we are continuing
to build our solid core deposit base," Richel stated.
Shareholders' equity decreased $3.9 million during the quarter from
$66.9 million at December 31, 1996 to $63.0 million at March 31, 1997.
The decrease from the preceding quarter reflected the repurchase of
172,500 shares of the Company's stock, a decrease of $2.4 million (net
of tax) in the March 31, 1997 market value of the Company's debt and
equity and mortgage-backed securities, and declaration of a quarterly
dividend. Offsetting these decreases were net income of $1.4 million
for the quarter, and allocations of ESOP shares and other employee
benefit plans during the period.
The results of operations for the first quarter of 1997 reflect an
increase in net interest income, after provision for loan losses over
the preceding quarter and the same quarter of the prior year, of $0.7
million and $1.1 million, respectively. This increase reflects growth
in average interest-earning assets, and changes in the mix within the
loan portfolio, net of an increase in borrowing costs due to higher
borrowing levels over both the preceding and year-ago quarters.
The increase in net interest income over the preceding and year-ago
quarters was partially offset by a decrease of $0.4 million in
non-interest income for the three months ended March 31, 1997 from the
preceding quarter, and a decrease of $0.3 million compared to the
year-ago quarter. This reduction in non-interest income from prior
periods is as a result of non-recurring unaccrued interest income
realized in those prior periods. The effect of the non-recurring
income to the earnings per share calculation for the preceding and
prior year's quarters was an increase to each prior period of $.05.
Excluding this non-recurring item, non-interest income for the current
quarter decreased $45,000, or 11%, from the preceding quarter,
principally as a result of reductions in late and penalty fees, and
increased $65,000, or 21%, as compared to the same quarter of the
prior year.
Other non-interest expense for the three months ended March 31, 1997
totaled $4.3 million as compared to $3.9 million for the preceding
quarter, and $3.8 million for the same quarter of the prior year.
This increase from the preceding quarter primarily reflects increased
insurance, advertising and data processing expenses associated with
the Company's core growth, and normal wage increases. In addition,
the fourth quarter of 1996 included a $0.2 million expense reversal
related to the favorable outcome of a federal tax issue. The increase
in the current period's non-interest expense over the quarter ended
March 31, 1996 primarily reflects staffing and support costs incurred
to achieve the marketing and operational success during this past
twelve months and to position the Company for continued success. Such
costs include those for new branches, a new operating system, staff
upgrades (especially in commercial services) and refurbishment of
existing facilities.
"The many changes and improvements to the Statewide Savings franchise
demonstrated our commitment to grow our business and serve our
customers. For example, Statewide now offers telephone banking, which
provides customers with access to a variety of information related to
their deposit and loan accounts, along with account funds transfer
capability and a variety of other features," stated Richel.
Statewide Financial Corp., headquartered in Jersey City, N.J., is the
holding company for Statewide Savings Bank S.L.A., which maintains 16
branches in Hudson, Union, Bergen and Passaic counties. Statewide
Savings Bank's deposits are insured by the Savings Association
Insurance Fund (SAIF) of the Federal Deposit Insurance Corporation
(FDIC).
SELECTED FINANCIAL CONDITION DATA March 31, December 31,
(dollars in thousands) 1997 1996
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Total Assets $677,384 $636,042
Loans, Net $327,610 $325,470
Debt and Equity Securities $ 37,127 $ 40,243
Mortgage-Backed Securities $278,659 $240,974
Other Real Estate Owned $ 389 $ 563
Total Deposits $458,676 $457,056
Borrowed Funds $150,200 $107,200
Shareholders' Equity $ 63,019 $ 66,935
Book Value Per Share $ 13.20 $ 13.63
SELECTED OPERATING DATA
(dollars in thousands) For the Three Months
Ended March 31,
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1997 1996
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Interest Income $12,487 $10,830
Interest Expense 6,234 5,629
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Net Interest Income 6,253 5,201
Provision for Loan Losses 125 125
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Net Interest Income After
Provision for Loan Losses 6,128 5,076
Non-Interest Income 373 664
Foreclosed Real Estate Expense, Net 7 62
Other Non-Interest Expense 4,283 3,796
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Income Before Income Taxes 2,211 1,882
Income Tax Expense 827 677
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Net Income $ 1,384 $ 1,205
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Earnings Per Share $ .32 $ .25
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Weighted Average Number of
Shares Outstanding 4,339,951 4,864,186
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SELECTED FINANCIAL RATIOS (1): At or For the
Three Months
Ended March 31,
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1997 1996
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Return on Average Assets .82% .78%
Return on Average Capital 8.57% 6.70%
Capital to Assets 9.30% 11.10%
Net Interest Rate Spread (2) 3.34% 2.95%
Net Interest Margin (3) 3.78% 3.44%
Non-Interest Income to Average Assets .22% .43%
Non-Interest Expense to Average Assets 2.55% 2.49%
Efficiency Ratio (4) 65.99% 71.66%
Average Interest Earning Assets to Average
Interest Earning Liabilities 111.44% 113.35%
REGULATORY CAPITAL RATIOS: March 31, December 31,
1997 1996
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Tangible Capital Ratio 9.02% 9.41%
Core Capital Ratio 9.02% 9.41%
ASSET QUALITY RATIOS:
Non-Performing Loans to Total Net Loans .89% .84%
Non-Performing Loans to Total Assets .43% .43%
Non-Performing Assets to Total Assets .49% .52%
Allowance for Loan Losses to Non-
Performing Loans 91.36% 95.43%
Allowance for Loan Losses to Total
Net Loans .81% .80%
OTHER DATA
Number of Deposit Accounts 54,834 53,695
Number of Offices 16 16
Notes to Selected Financial Ratios
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(1) Ratios are annualized where appropriate.
(2) Interest rate spread represents the difference between the
weighted average yield on average interest-earning assets and the
weighted average costs of average interest-bearing liabilities.
(3) Net interest margin represents net interest income as a percent
of average interest-earning assets.
(4) Total non-interest expense divided by the sum of net interest
income after provision for loan losses, and recurring
non-interest income.
