UNITED
STATES
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): October 25,
2006
DIME
COMMUNITY BANCSHARES, INC.
(Exact
name of registrant as specified in its charter)
|
Delaware
|
0-27782
|
11-3297463
|
||
|
(State
or other jurisdiction of incorporation)
|
(Commission
File Number)
|
(IRS
Employer
Identification
No.)
|
209
Havemeyer Street, Brooklyn, New York 11211
(Address
of principal executive offices, including zip code)
Registrant's
telephone number, including area code: (718)
782-6200
None
(Former
name or former
address,
if changed since last report)
Check
the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions:
| r |
Written
communications pursuant to Rule 425 under the Securities Act (17
CFR
230.425)
|
| r |
Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14d-2(b))
|
| r |
Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act
(17 CFR
240.14d-2(b))
|
| r |
Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act
(17 CFR
240.13e-4(c))
|
Item
2.02. Results
of Operations and Financial Condition
On
October 25, 2006, Registrant issued a press release containing a discussion
of
its results of operations and financial condition for the quarter ended
September 30, 2006. The text of the press release is included as Exhibit 99
to
this report.
Item
9.01.
Financial
Statements and Exhibits.
(d)
Exhibits
Exhibit
No.
99 Press
release of the Registrant, dated October 25, 2006, containing a discussion
of
Registrant’s results of operations and financial condition for the quarter
ended
September 30,
2006.
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the Registrant
has
duly caused this Form 8-K Report to be signed on its behalf by the undersigned
hereunto duly authorized.
DIME COMMUNITY BANCSHARES, INC.
|
By:
|
/s/
KENNETH J. MAHON
|
|
Kenneth
J. Mahon
|
|
|
Executive
Vice President and Chief Financial
Officer
|
Dated:
October 25, 2006
INDEX TO EXHIBITS
Exhibit
Number
(99) Press
release of the
Registrant, dated October 25, 2006, containing a discussion
of Registrant’s results of operations and financial condition for the
quarter
ended
September 30,
2006.
EXHIBIT
99
DIME
COMMUNITY BANCSHARES REPORTS THIRD QUARTER EARNINGS
Diluted
Earnings Per Share of 20 Cents
Brooklyn,
NY - October 25, 2006 - Dime Community Bancshares, Inc. (NASDAQ: DCOM), (the
"Company"), the parent company of The Dime Savings Bank of Williamsburgh (the
"Bank"), today reported net income of $7.2 million, or 20 cents per diluted
share, for the quarter ended September 30, 2006, compared to $9.1 million,
or 26
cents per diluted share, for each of the quarters ended September 30, 2005
and
June 30, 2006, respectively.
Core
earnings were $6.7 million, or $0.19 per diluted share, for the quarter ended
September 30, 2006, compared to $9.1 million, or $0.26 per diluted share, for
the quarter ended September 30, 2005 and $8.4 million, or $0.24 per diluted
share, for the quarter ended June 30, 2006. During
the quarter ended September 30, 2006, reported earnings exceeded core earnings
due to a non-recurring, pre-tax reduction of $764,000 in interest expense
related to a restructuring of $170.0 million of borrowings. During the quarter
ended June 30, 2006, reported earnings exceeded core earnings due to a pre-tax
gain of $1.1 million on the sale of mutual fund investments associated with
the
Company's Benefit Maintenance Plan.
According
to Vincent F. Palagiano, Chairman and Chief Executive Officer of the Company,
“As you will see, the biggest factors affecting income again this quarter were
the level of prepayment income and the cost of deposits. Prepayment income
was
lower, although more in line with our expectations for this year. Rising deposit
costs merely reflect conditions in the deposit marketplace as we re-enter the
market for new deposits.”
Mr.
Palagiano continued, “Yields on new loan production remained above 6%. Although
the environment is not ideal, if loan demand continues at the current moderate
pace, conditions are present for renewed, profitable growth, even with higher
deposit costs and lower margins. From our point of view, the Fed’s decision to
pause its monetary tightening strategy, combined with a less robust lending
environment, appears to have mitigated some of the aggressive rate competition
for bank deposits, mainly certificates of deposit.”
Third
Quarter 2006 Highlights
| § |
The
Company recorded a non-recurring reduction to interest expense of
$764,000
related to the restructuring of $170.0 million of borrowings. Upon
completing the transaction, the average interest rate on these borrowed
funds dropped from 4.53% to 3.79%.
|
| § |
The
annualized loan amortization rate decreased slightly from 16% to
approximately 15% sequentially. Prepayment fee income was $1.3 million,
compared to $2.1 million in the June 2006 quarter and $1.3 million
in the
September 2005 quarter.
|
| § |
The
Bank’s credit profile remained outstanding, with nonperforming loans
remaining unchanged from the prior quarter at 0.11% of total
loans.
|
| § |
Deposits
remained relatively constant, although linked quarter average cost
of
deposits rose from 2.80% to 3.10% during the
quarter.
|
| § |
Real
estate loan originations rose to $174.5 million at an average rate
of
6.58%, compared to $134.8 million at an average interest rate of
6.44%
during the second quarter of 2006.
|
| § |
Loans
in the pipeline approximated $89.8 million at quarter-end, including
commitments for sale to Fannie Mae of $6.5
million.
|
| § |
Net
interest margin was 2.53%, 26 basis points lower
sequentially.
|
| § |
The
Company repurchased 179,448 shares of its common stock. The consolidated
tangible equity ratio remained nearly unchanged at
7.88%.
|
| § |
Quarterly
non-interest expense remained relatively constant from the June 2006
quarter, and declined by 1%
year-over-year.
|
FINANCIAL
RESULTS
For
the
quarter ended September 30, 2006, the Company’s pre-tax income, excluding gains
and losses on the sale of assets, was $10.4 million, compared to $13.9 million
in the same quarter of the previous year. The $3.5 million decrease was due
to a
decline of $3.6 million in net interest income that was offset slightly by
a
decline of $116,000 in non-interest expense.
Average
earning assets declined by $128.9 million year-over-year. The net interest
margin contracted 36 basis points, from 2.89% during the September 2005 quarter
to 2.53% during the September 2006 quarter.
On
a
linked quarter basis, the Company’s pre-tax income, excluding gains and losses
on the sale of assets, decreased $2.2 million, from $12.6 million during the
June 2006 quarter to $10.4 million during the quarter ended September 30, 2006,
primarily due to a decline in net interest income of $2.2 million. The net
interest margin decreased 26 basis points, to 2.53% during the September 2006
quarter from 2.79% in the June 2006 quarter.
Prepayment
fee income was $1.3 million in the quarter ended September 30, 2006, compared
to
$2.1 million in the quarter ended June 30, 2006, and $1.3 million in the quarter
ended September 30, 2005.While loan repayment speeds declined from the previous
quarter, they still fell above the 10 - 12% range anticipated by management
for
2006. The average interest rate on loan repayments was 5.99% during the
September 2006 quarter compared to an average origination rate of 6.58%. For
the
first nine months of 2006, annualized loan repayment speeds approximated 13%,
compared with speeds of 14% and 24% during the years ended December 31, 2005
and
2004, respectively.
Excluding
all prepayment fee income from the calculation of net interest margin, the
margin deteriorated on a linked quarter basis from 2.50% to 2.35% due to an
increase of 30 basis points in the average cost of deposits that resulted from
increases in interest rates during 2005 and 2006.
The
yield
on interest earning assets decreased 8 basis points on a linked quarter basis,
due solely to the decline in prepayment fee income. Excluding the effect of
prepayment fee income, the yield on interest earning assets would have increased
5 basis points on a linked quarter basis, reflecting both an increase in yield
on the Company's real estate loans (excluding prepayment fee income) and
mortgage backed securities, both of which resulted from interest rate increases
during 2005 and 2006, and the movement of a greater percentage of the total
interest earning assets from securities into real estate loans, the Company's
highest yielding asset. The average yield on real estate loans, excluding the
effects of prepayment fee income, was 5.70% during the quarter ended September
30, 2006 and 5.67% during the quarter ended June 30, 2006. The interest rates
on
newly originated real estate loans continued to increase, averaging 6.58% during
the third quarter of 2006, up from 5.84% during the third quarter of 2005 and
6.44% during the second quarter of 2006. This, combined with both a reduction
in
the levels of lower-yielding securities and the increase in yield on existing
real estate loans also contributed greatly to the increase of 5 basis points
in
yield on earning assets (excluding prepayment fee income) on a linked quarter
basis.
During
the third quarter of 2006, deposits remained relatively constant, with an
increase of $5.0 million in core (non-certificate) deposits offset by a decrease
of $5.0 million in certificates of deposit, as promotional activities during
the
most recent quarter resulted in the transfer of deposit funds from certificates
of deposit into money market accounts.
Average
deposits per branch approximated $92 million at September 30, 2006, unchanged
from the June 2006 quarter and lower than the $101 million average at September
30, 2005. The loan-to-deposit ratio was 137% at September 30, 2006, compared
to
128% at September 30, 2005 and 138% at June 30, 2006. The decline in the average
deposits per branch and the increase in the loan-to-deposit ratio in the
September 2006 quarter compared to the September 2005 quarter resulted primarily
from a reduction of $84.2 million in deposits from their September 30, 2005
level. This was due to a decline in money market deposits from September 2005
through June 2006, a period during which the Bank elected not to compete
aggressively to retain money market deposits in light of rising short-term
interest rates. Core deposits comprised 47% of total deposits at both September
30, 2006 and June 30, 2006, decreasing slightly from the 49% level at September
30, 2005 as a result of the decline in money market deposits from September
30,
2005 through both June 30, 2006 and September 30, 2006.
During
the quarter ended September 30, 2006, the Company restructured $170.0 million
of
wholesale borrowings. Under this restructuring, $120.0 million of securities
sold under agreement to repurchase ("reverse repos") and $50.0 million in FHLBNY
advances with a 1-year average life were prepaid and replaced with borrowings
having a final maturity of 10 years (callable after 1 - 3 years). The prepaid
borrowings had a weighted average interest rate of 4.53%, and were replaced
with
a combination of reverse repos and FHLBNY advances having an initial weighted
average interest rate of 3.79%. The new FHLBNY advances have a fixed weighted
average interest rate of 4.36%. The new reverse repos are variable rate
initially, and, if not called by the lender, convert to a fixed rate of 4.90%
until maturity. The Company recorded a non-recurring reduction of $764,000
in
interest expense related to the prepayment.
Non-interest
income, excluding gains or losses on the sale of assets, totaled $2.4 million
during the quarter ended September 30, 2006, relatively constant from both
the
September 2005 and June 2006 quarters.
The
Company sold loans to Fannie Mae totaling $92.3 million, $25.5 million and
$21.0
million, recording gains of $779,000, $284,000 and $253,000, during the quarters
ended September 30, 2006, September 30, 2005 and June 30, 2006, respectively.
All of the loans sold during each of these periods were designated for sale
upon
origination. The loans sold during the quarter ended September 30, 2006 had
a
weighted average term to the earlier of maturity or next repricing of 10.2
years.
During
the quarter ended June 30, 2006, the Company recorded a pre-tax gain of $1.1
million on the sale of mutual fund investments associated with its Benefit
Maintenance Plan. The gain resulted from a reallocation of investments held
to
fund future supplemental retirement benefits. Since these available-for-sale
investments were carried at market value under U.S. Generally Accepted
Accounting Principles, the after-tax gain was previously reflected in the
Company's stockholders' equity. The act of reallocating the investments caused
the Company to recognize a gain in its income statement. There were no sales
of
securities or other assets during the quarters ended September 30, 2006 and
2005.
Non-interest
expense totaled $10.6 million during the quarter ended September 30, 2006,
relatively flat sequentially, and a decrease of $116,000, or 1.1%, from the
September 2005 quarter. The decrease of $116,000 was due partially to a decline
of $159,000 in data processing systems expense that resulted from a settlement
of expenses with the Company’s previous systems provider that occurred in the
September 2005 quarter.
Non-interest
expense to average assets was 1.37% in the September 2006 quarter, compared
to
1.32% for the quarter ended September 30, 2005, and 1.34% for the quarter ended
June 2006. The increase in the ratio resulted primarily from a decline of $138
million in average assets from the September 2005 quarter to the September
2006
quarter, as the Company permitted liabilities to runoff without being replaced
during the period (thus reducing interest earning assets) in response to
unfavorable market conditions.
The
effective tax rate was 35.9% for the quarter ended September 30, 2006, 35.1%
for
the quarter ended June 30, 2006 and 35.9% for the quarter ended September 30,
2005. The effective tax rate is expected to approximate 36.0% for the full
year
ending December 31, 2006.
REAL
ESTATE LENDING AND CREDIT QUALITY
Real
estate loan originations totaled $174.5 million during the quarter ended
September 30, 2006, of which $33.3 million, or 19%, represented commercial
real
estate. The average rate on total loan originations during the quarter was
6.58%, compared to 5.84% in the quarter ended September 30, 2005 and 6.44%
during the quarter ended June 30, 2006. Commercial real estate represented
25%
of the gross loan portfolio at September 30, 2006, compared with 22% as of
December 31, 2005. The commercial real estate portfolio grew at a 21% rate
year-over-year.
Real
estate loan prepayment and amortization during the September 2006 quarter
approximated 15% of the loan portfolio on an annualized basis, unchanged from
the September 2005 quarter and down slightly from 16% during the June 2006
quarter. The average interest rate on real estate loan prepayment and
amortization during the most recent quarter was 5.99%.
Non-performing
loans were $2.9 million at September 30, 2006, representing only 0.11% of total
loans. There were no new loans added to non-performing status during the
September 2006 quarter. Management does not currently expect to incur any
significant losses on these loans.
STOCKHOLDERS'
EQUITY AND SHARE REPURCHASE PROGRAM
The
Company’s total stockholders’ equity at September 30, 2006 was $295.7 million,
or 9.43% of total assets, compared to $293.1 million, or 9.38% of total assets,
at June 30, 2006. After outlays for dividends paid to shareholders and share
repurchases, by the end of the third quarter of 2006 the Company’s tangible
equity had climbed to $243.4 million, as compared to $242.2 million at June
30,
2006. The quarterly cash dividend paid in August 2006 represented a payout
ratio
of 70% of third quarter 2006 earnings. At September 30, 2006, tangible
stockholders’ equity was 7.88% of tangible assets and the tangible book value
per share was $6.64.
During
the quarter ended September 30, 2006, the return on average stockholders’ equity
was 9.7%, the return on average tangible equity was 11.8%, and the cash return
on average tangible equity was 12.4%.
During
the third quarter of 2006, the Company repurchased into
treasury 179,448 shares,
or 0.5%, of its common stock outstanding at June 30, 2006. As of September
30,
2006, the Company had an additional 47,965 shares remaining eligible for
repurchase under its tenth stock repurchase program, approved in May 2004.
On
December 15, 2005, the Board of Directors approved the Company's eleventh stock
repurchase program, which authorizes the purchase, at the discretion of
management, of an additional 1,847,977
shares.
OUTLOOK
At
present, the overall yield on the Company's interest-earning assets is rising
(excluding the effects of prepayment fee income). The average yield on interest
earning assets, excluding the effects of prepayment fee income, rose on a linked
quarter basis, from 5.54% to 5.59%.
The
cost
of deposits rose from 2.80% during the June 30, 2006 quarter to 3.10% during
the
September 2006 quarter. This trend is likely to continue, whether or not the
Bank grows deposits. The rising cost of deposits is due to a combination of
repricing lower rate deposits already on the books, plus the cost of attracting
new deposits.
At
13.6%
annualized during the first nine months of 2006, prepayment and amortization
rates were slightly in excess of the range anticipated by management, and are
expected to fall within a 10% to 12% range during the final quarter of 2006.
At
September 30, 2006, the real estate loan commitment pipeline approximated $89.8
million, with a weighted average interest rate of 6.63%, including $6.5 million
of loan commitments intended for sale to Fannie Mae.
Operating
expenses are expected to be approximately $10.7 million in the fourth quarter
of
2006. Share repurchases are expected to be in line with recent practices. The
Company is positioned, however, to be opportunistic in the purchase of its
own
shares should conditions warrant. Based on this outlook, the Company now expects
fourth quarter 2006 earnings per diluted share to be in the range of $0.16
to
$0.18.
“The
cost
of deposits will continue to determine the direction of earnings,” Mr. Palagiano
stated. “While there is disagreement about the direction of the economy and Fed
policy, we believe that most of the increase in deposit rates is behind us.
We
believe deposit costs are already near their peak and will level off within
the
next quarter or two. With a strong capital base and a low level of nonperforming
assets, we look forward to regaining momentum in both growth and
earnings.”
ABOUT
DIME COMMUNITY BANCSHARES
Dime
Community Bancshares, Inc., a unitary thrift holding company, is the parent
company of The Dime Savings Bank of Williamsburgh, founded in 1864, and
headquartered in Brooklyn, New York. With $3.14 billion in assets as of
September 30, 2006, the Bank has twenty-one branches located throughout
Brooklyn, Queens, the Bronx and Nassau County, New York. More information on
the
Company and Bank can be found on the Bank's Internet website at www.dimedirect.com.
This
News Release contains a number of forward-looking statements within the meaning
of Section 27A of the Securities Act of 1933, as amended and Section 21E of
the
Securities Exchange Act of 1934, as amended (the "Exchange Act"). These
statements may be identified by use of words such as "anticipate," "believe,"
"could," "estimate," "expect," "intend," "may," "outlook," "plan," "potential,"
"predict," "project," "should," "will," "would" and similar terms and phrases,
including references to assumptions.
Forward-looking
statements are based upon various assumptions and analyses made by the Company
in light of management's experience and its perception of historical trends,
current conditions and expected future developments, as well as other factors
it
believes are appropriate under the circumstances. These statements are not
guarantees of future performance and are subject to risks, uncertainties and
other factors (many of which are beyond the Company's control) that could cause
actual results to differ materially from future results expressed or implied
by
such forward-looking statements. These factors include, without limitation,
the
following: the timing and occurrence or non-occurrence of events may be subject
to circumstances beyond the Company’s control; there may be increases in
competitive pressure among financial institutions or from non-financial
institutions; changes in the interest rate environment may reduce interest
margins; changes in deposit flows, loan demand or real estate values may
adversely affect the business of the Bank; changes in accounting principles,
policies or guidelines may cause the Company’s financial condition to be
perceived differently; changes in corporate and/or individual income tax laws
may adversely affect the Company's financial condition or results of operations;
general economic conditions, either nationally or locally in some or all areas
in which the Company conducts business, or conditions in the securities markets
or the banking industry may be less favorable than the Company currently
anticipates; legislation or regulatory changes may adversely affect the
Company’s business; technological changes may be more difficult or expensive
than the Company anticipates; success or consummation of new business
initiatives may be more difficult or expensive than the Company anticipates;
or
litigation or other matters before regulatory agencies, whether currently
existing or commencing in the future, may delay the occurrence or non-occurrence
of events longer than the Company anticipates.
-
Tables
to follow -
|
Contact:
|
Kenneth
Ceonzo
|
|
Director
of Investor Relations
|
|
|
718-782-6200
extension 8279
|
DIME
COMMUNITY BANCSHARES, INC. AND SUBSIDIARIES
CONSOLIDATED
STATEMENTS OF FINANCIAL CONDITION
(In
thousands except share amounts)
|
September
30,
|
|||
|
2006
|
December
31,
|
||
|
(Unaudited)
|
2005
|
||
|
ASSETS:
|
|||
|
Cash
and due from banks
|
$
22,539
|
$
40,199
|
|
|
Investment
securities held to maturity
|
380
|
455
|
|
|
Investment
securities available for sale
|
29,170
|
44,832
|
|
|
Mortgage-backed
securities available for sale
|
162,938
|
193,453
|
|
|
Federal
funds sold and other short-term assets
|
94,082
|
60,014
|
|
|
Real
estate Loans:
|
|||
|
One-to-four
family and cooperative apartment
|
158,861
|
145,754
|
|
|
Multifamily
and underlying cooperative
|
1,811,961
|
1,873,940
|
|
|
Commercial
real estate
|
653,806
|
576,561
|
|
|
Construction
and land acquisition
|
15,738
|
12,098
|
|
|
Unearned
discounts and net deferred loan fees
|
924
|
501
|
|
|
Total
real estate loans
|
2,641,290
|
2,608,854
|
|
|
Other
loans
|
2,234
|
2,341
|
|
|
Allowance
for loan losses
|
(15,956)
|
(15,785)
|
|
|
Total
loans, net
|
2,627,568
|
2,595,410
|
|
|
Loans
held for sale
|
-
|
900
|
|
|
Premises
and fixed assets, net
|
22,610
|
16,527
|
|
|
Federal
Home Loan Bank of New York capital stock
|
31,745
|
29,917
|
|
|
Goodwill
|
55,638
|
55,638
|
|
|
Other
assets
|
90,930
|
88,881
|
|
|
TOTAL
ASSETS
|
$
3,137,600
|
$
3,126,226
|
|
|
LIABILITIES
AND STOCKHOLDERS' EQUITY:
|
|||
|
Deposits:
|
|||
|
Checking,
NOW and Super NOW
|
$127,541
|
$135,698
|
|
|
Savings
|
305,716
|
335,527
|
|
|
Money
Market
|
470,541
|
464,962
|
|
|
Sub-total
|
903,798
|
936,187
|
|
|
Certificates
of deposit
|
1,026,897
|
978,585
|
|
|
Total
Due to depositors
|
1,930,695
|
1,914,772
|
|
|
Escrow
and other deposits
|
68,035
|
47,518
|
|
|
Securities
sold under agreements to repurchase
|
120,380
|
205,455
|
|
|
Federal
Home Loan Bank of New York advances
|
581,500
|
531,500
|
|
|
Subordinated
Notes Sold
|
25,000
|
25,000
|
|
|
Trust
Preferred Notes Payable
|
72,165
|
72,165
|
|
|
Other
liabilities
|
44,078
|
38,102
|
|
|
TOTAL
LIABILITIES
|
2,841,853
|
2,834,512
|
|
|
STOCKHOLDERS'
EQUITY:
|
|||
|
Common
stock ($0.01 par, 125,000,000 shares authorized, 50,862,445 shares
and
50,633,881
shares
issued at
September 30, 2006 and December 31, 2005, respectively,
and 36,665,264 shares and 36,956,907 shares outstanding at
September 30, 2006 and December 31, 2005, respectively)
|
509
|
506
|
|
|
Additional
paid-in capital
|
206,351
|
204,083
|
|
|
Retained
earnings
|
284,367
|
274,579
|
|
|
Unallocated
common stock of Employee Stock Ownership Plan
|
(4,453)
|
(4,627)
|
|
|
Unearned
common stock of Recognition and Retention Plan
|
(3,518)
|
(2,979)
|
|
|
Common
stock held by the Benefit Maintenance Plan
|
(7,941)
|
(7,941)
|
|
|
Treasury
stock (14,197,181 shares
and 13,676,974 shares at September 30, 2006 and
December 31, 2005, respectively)
|
(176,034)
|
(168,579)
|
|
|
Accumulated
other comprehensive loss, net
|
(3,534)
|
(3,328)
|
|
|
TOTAL
STOCKHOLDERS' EQUITY
|
295,747
|
291,714
|
|
|
TOTAL
LIABILITIES AND STOCKHOLDERS' EQUITY
|
$3,137,600
|
$3,126,226
|
DIME
COMMUNITY BANCSHARES, INC. AND SUBSIDIARIES
UNAUDITED
CONSOLIDATED STATEMENTS OF OPERATIONS
(Dollars
In thousands except per share amounts)
|
For
the Three Months Ended
|
For
the Nine Months Ended
|
||||||||
|
September
30,
|
June
30,
|
September
30,
|
September
30,
|
September
30,
|
|||||
|
2006
|
2006
|
2005
|
2006
|
2005
|
|||||
|
Interest
income:
|
|||||||||
|
Loans
secured by real estate
|
$39,122
|
$39,844
|
$37,472
|
$116,805
|
$110,753
|
||||
|
Other
loans
|
47
|
45
|
29
|
141
|
96
|
||||
|
Mortgage-backed
securities
|
1,666
|
1,753
|
2,010
|
5,264
|
9,770
|
||||
|
Investment
securities
|
454
|
469
|
601
|
1,405
|
1,963
|
||||
|
Other
|
1,384
|
1,522
|
2,230
|
4,062
|
5,071
|
||||
|
Total
interest income
|
42,673
|
43,633
|
42,342
|
127,677
|
127,653
|
||||
|
Interest
expense:
|
|||||||||
|
Deposits
and escrow
|
15,019
|
13,554
|
10,690
|
40,069
|
30,256
|
||||
|
Borrowed
funds
|
8,948
|
9,228
|
9,306
|
27,610
|
26,956
|
||||
|
Total
interest expense
|
23,967
|
22,782
|
19,996
|
67,679
|
57,212
|
||||
|
Net
interest income
|
18,706
|
20,851
|
22,346
|
59,998
|
70,441
|
||||
|
Provision
for loan losses
|
60
|
60
|
60
|
180
|
180
|
||||
|
Net
interest income after provision for loan
losses
|
18,646
|
20,791
|
22,286
|
59,818
|
70,261
|
||||
|
Non-interest
income:
|
|||||||||
|
Service
charges and other fees
|
1,507
|
1,457
|
1,561
|
4,461
|
4,483
|
||||
|
Net
gain (loss) on sales and redemptions of
assets
|
779
|
1,317
|
284
|
2,973
|
(4,605)
|
||||
|
Other
|
849
|
919
|
796
|
2,554
|
2,666
|
||||
|
Total
non-interest income
|
3,135
|
3,693
|
2,641
|
9,988
|
2,544
|
||||
|
Non-interest
expense:
|
|||||||||
|
Compensation
and benefits
|
6,006
|
5,804
|
6,059
|
17,678
|
17,290
|
||||
|
Occupancy
and equipment
|
1,504
|
1,379
|
1,389
|
4,295
|
4,002
|
||||
|
Core
deposit intangible amortization
|
-
|
-
|
-
|
-
|
48
|
||||
|
Other
|
3,110
|
3,345
|
3,288
|
9,623
|
9,087
|
||||
|
Total
non-interest expense
|
10,620
|
10,528
|
10,736
|
31,596
|
30,427
|
||||
|
Income
before taxes
|
11,161
|
13,956
|
14,191
|
38,210
|
42,378
|
||||
|
Income
tax expense
|
4,002
|
4,896
|
5,089
|
13,583
|
15,147
|
||||
|
Net
Income
|
$7,159
|
$9,060
|
$9,102
|
$24,627
|
$27,231
|
||||
|
Earnings
per Share:
|
|||||||||
|
Basic
|
$0.21
|
$0.26
|
$0.26
|
$0.70
|
$0.77
|
||||
|
Diluted
|
$0.20
|
$0.26
|
$0.26
|
$0.70
|
$0.76
|
||||
|
|
|||||||||
|
Average
common shares outstanding for
Diluted
EPS
|
35,028,903
|
35,202,812
|
35,553,132
|
35,200,367
|
35,653,116
|
||||
DIME
COMMUNITY BANCSHARES, INC. AND SUBSIDIARIES
Core
Earnings and Core Cash Earnings Reconciliations
(Dollars
In thousands except per share amounts)
Core
earnings and related data are "Non-GAAP Disclosures." These disclosures present
information which management considers useful to the readers of this report
since they present a measure of the results of the Company's ongoing operations
(exclusive of significant non-recurring items such as gains or losses on sales
of investment or mortgage-backed securities) during the period.
In
addition, Core cash earnings and related data are also "Non-GAAP Disclosures."
These disclosures present information which management considers useful to
the
readers of this report since they present a measure of the tangible equity
generated from operations during each period presented. Tangible equity
generation is a significant financial measure since banks are subject to
regulatory requirements involving the maintenance of minimum tangible capital
levels.
The
following tables present a reconciliation of GAAP net income and both core
earnings and core cash earnings, as well as financial performance ratios
determined based upon core earnings and core cash earnings, for each of the
periods presented:
|
For
the Three Months Ended
|
For
the Nine Months Ended
|
||||||||
|
September
30,
|
June
30,
|
September
30,
|
September
30,
|
September
30,
|
|||||
|
2006
|
2006
|
2005
|
2006
|
2005
|
|||||
|
Net
income as reported
|
$
7,159
|
$
9,060
|
$
9,102
|
$
24,627
|
$
27,231
|
||||
|
Pre-tax
net (gain) loss on sale of securities and other assets
|
(1,064)
|
-
|
(1,542)
|
5,176
|
|||||
|
Pre-tax
income from borrowings restructuring
|
(764)
|
-
|
-
|
(807)
|
-
|
||||
|
Tax
effect of adjustments
|
271
|
378
|
-
|
839
|
(2,143)
|
||||
|
Core
Earnings
|
$
6,666
|
$
8,374
|
$
9,102
|
$
23,117
|
$
30,264
|
||||
|
Cash
Earnings Additions :
|
|||||||||
|
Core
Deposit Intangible Amortization
|
-
|
-
|
-
|
-
|
48
|
||||
|
Non-cash
stock benefit plan expense
|
342
|
358
|
359
|
1,067
|
1,054
|
||||
|
Core
Cash Earnings
|
$
7,008
|
$
8,732
|
$
9,461
|
$
24,184
|
$
31,366
|
||||
|
Performance
Ratios (Based upon Core Cash Earnings):
|
|||||||||
|
Core
Cash EPS (Diluted)
|
$
0.20
|
$
0.25
|
0.27
|
$
0.69
|
0.88
|
||||
|
Core
Cash Return on Average Assets
|
0.90%
|
1.11%
|
1.17%
|
1.03%
|
1.26%
|
||||
|
Core
Cash Return on Average Tangible Stockholders' Equity
|
11.55%
|
14.46%
|
16.13%
|
13.38%
|
18.02%
|
||||
DIME
COMMUNITY BANCSHARES, INC. AND SUBSIDIARIES
UNAUDITED
SELECTED FINANCIAL HIGHLIGHTS
(Dollars
In thousands except per share amounts)
|
For
the Three Months Ended
|
For
the Nine Months Ended
|
||||||||
|
September
30,
|
June
30,
|
September
30,
|
September
30,
|
September
30,
|
|||||
|
2006
|
2006
|
2005
|
2006
|
2005
|
|||||
|
Performance
Ratios (Based upon Reported Earnings):
|
|||||||||
|
Reported
EPS (Diluted)
|
$0.20
|
$0.26
|
$0.26
|
$0.70
|
$0.76
|
||||
|
Return
on Average Assets
|
0.92%
|
1.16%
|
1.12%
|
1.05%
|
1.10%
|
||||
|
Return
on Average Stockholders' Equity
|
9.73%
|
12.37%
|
12.62%
|
11.21%
|
12.75%
|
||||
|
Return
on Average Tangible Stockholders' Equity
|
11.80%
|
15.00%
|
15.52%
|
13.63%
|
15.64%
|
||||
|
Net
Interest Spread
|
2.15%
|
2.36%
|
2.61%
|
2.29%
|
2.68%
|
||||
|
Net
Interest Margin
|
2.53%
|
2.79%
|
2.89%
|
2.69%
|
2.97%
|
||||
|
Non-interest
Expense to Average Assets
|
1.37%
|
1.34%
|
1.32%
|
1.35%
|
1.22%
|
||||
|
Efficiency
Ratio
|
50.42%
|
45.33%
|
43.46%
|
47.15%
|
39.22%
|
||||
|
Effective
Tax Rate
|
35.86%
|
35.08%
|
35.86%
|
35.55%
|
35.74%
|
||||
|
Performance
Ratios (Based upon Core Earnings):
|
|||||||||
|
Core
EPS (Diluted)
|
$
0.19
|
$
0.24
|
$
0.26
|
$
0.66
|
$
0.85
|
||||
|
Core
Return on Average Assets
|
0.86%
|
1.07%
|
1.12%
|
0.99%
|
1.22%
|
||||
|
Core
Return on Average Stockholders' Equity
|
9.06%
|
11.44%
|
12.62%
|
10.53%
|
14.17%
|
||||
|
Core
Return on Average Tangible Stockholders' Equity
|
10.99%
|
13.87%
|
15.52%
|
12.79%
|
17.39%
|
||||
|
Book
Value and Tangible Book Value Per Share:
|
|||||||||
|
Stated
Book Value Per Share
|
$
8.07
|
$
7.97
|
$
7.82
|
$
8.07
|
$
7.82
|
||||
|
Tangible
Book Value Per Share
|
6.64
|
6.58
|
6.39
|
6.64
|
6.39
|
||||
|
Average
Balance Data:
|
|||||||||
|
Average
Assets
|
$
3,109,183
|
$
3,134,815
|
$
3,247,216
|
$
3,120,938
|
$
3,313,154
|
||||
|
Average
Interest Earning Assets
|
2,961,903
|
2,992,772
|
3,090,823
|
2,973,751
|
3,163,811
|
||||
|
Average
Stockholders' Equity
|
294,305
|
292,882
|
288,431
|
292,805
|
284,857
|
||||
|
Average
Tangible Stockholders' Equity
|
242,658
|
241,554
|
234,560
|
240,967
|
232,098
|
||||
|
Average
Loans
|
2,656,014
|
2,658,556
|
2,560,963
|
2,647,969
|
2,514,698
|
||||
|
Average
Deposits
|
1,920,061
|
1,942,554
|
2,056,864
|
1,920,958
|
2,124,448
|
||||
|
Asset
Quality Summary:
|
|||||||||
|
Net
charge-offs (recoveries)
|
$ -
|
$
8
|
($
2)
|
$
19
|
($
17)
|
||||
|
Nonperforming
Loans
|
2,889
|
2,885
|
4,608
|
2,889
|
4,608
|
||||
|
Nonperforming
Loans/ Total Loans
|
0.11%
|
0.11%
|
0.18%
|
0.11%
|
0.18%
|
||||
|
Nonperforming
Assets/Total Assets
|
0.09%
|
0.09%
|
0.14%
|
0.09%
|
0.14%
|
||||
|
Allowance
for Loan Loss/Total Loans
|
0.60%
|
0.60%
|
0.60%
|
0.60%
|
0.60%
|
||||
|
Allowance
for Loan Loss/Nonperforming Loans
|
552.30%
|
555.74%
|
335.55%
|
552.30%
|
335.55%
|
||||
|
Regulatory
Capital Ratios:
|
|||||||||
|
Consolidated
Tangible Equity to Tangible Assets at period end
|
7.88%
|
7.87%
|
7.44%
|
7.88%
|
7.44%
|
||||
|
Tangible
Capital Ratio (Bank Only)
|
9.64%
|
9.39%
|
9.20%
|
9.64%
|
9.20%
|
||||
|
Leverage
Capital Ratio (Bank Only)
|
9.64%
|
9.39%
|
9.20%
|
9.64%
|
9.20%
|
||||
|
Risk
-Based Capital Ratio (Bank Only)
|
13.61%
|
13.38%
|
13.84%
|
13.61%
|
13.84%
|
||||
DIME
COMMUNITY BANCSHARES, INC. AND SUBSIDIARIES
AVERAGE
BALANCES AND NET INTEREST INCOME
(Dollars
In thousands)
|
For
the Three Months Ended
|
|||||||||||
|
September
30, 2006
|
June
30, 2006
|
September
30, 2005
|
|||||||||
|
Average
|
Average
|
Average
|
|||||||||
|
Average
|
Yield/
|
Average
|
Yield/
|
Average
|
Yield/
|
||||||
|
Balance
|
Interest
|
Cost
|
Balance
|
Interest
|
Cost
|
Balance
|
Interest
|
Cost
|
|||
|
(Dollars
In Thousands)
|
|||||||||||
|
Assets:
|
|||||||||||
|
Interest-earning
assets:
|
|||||||||||
|
Real
Estate Loans
|
$2,654,055
|
$39,122
|
5.90%
|
$2,656,658
|
$39,844
|
6.00%
|
$2,558,690
|
$37,472
|
5.86%
|
||
|
Other
loans
|
1,959
|
47
|
9.60
|
1,898
|
45
|
9.48
|
2,273
|
29
|
5.10
|
||
|
Mortgage-backed
securities
|
172,116
|
1,666
|
3.87
|
182,101
|
1,753
|
3.85
|
218,204
|
2,010
|
3.68
|
||
|
Investment
securities
|
31,376
|
454
|
5.79
|
31,023
|
469
|
6.05
|
65,259
|
601
|
3.68
|
||
|
Other
short-term investments
|
102,397
|
1,384
|
5.41
|
121,092
|
1,522
|
5.03
|
246,397
|
2,230
|
3.62
|
||
|
Total
interest earning assets
|
2,961,903
|
$42,673
|
5.76%
|
2,992,772
|
$43,633
|
5.84%
|
3,090,823
|
$42,342
|
5.48%
|
||
|
Non-interest
earning assets
|
147,280
|
142,043
|
156,393
|
||||||||
|
Total
assets
|
$3,109,183
|
$3,134,815
|
$3,247,216
|
||||||||
|
Liabilities
and Stockholders' Equity:
|
|||||||||||
|
Interest-bearing
liabilities:
|
|||||||||||
|
NOW,
Super Now accounts
|
$33,814
|
$85
|
1.00%
|
$36,778
|
$91
|
0.99%
|
$39,728
|
$100
|
1.00%
|
||
|
Money
Market accounts
|
455,629
|
3,228
|
2.81
|
452,288
|
2,578
|
2.29
|
570,067
|
2,284
|
1.59
|
||
|
Savings
accounts
|
312,891
|
493
|
0.63
|
325,403
|
476
|
0.59
|
349,384
|
486
|
0.55
|
||
|
Certificates
of deposit
|
1,023,738
|
11,213
|
4.35
|
1,030,354
|
10,409
|
4.05
|
1,003,995
|
7,820
|
3.10
|
||
|
Total
interest bearing deposits
|
1,826,072
|
15,019
|
3.26
|
1,844,823
|
13,554
|
2.95
|
1,963,174
|
10,690
|
2.17
|
||
|
Borrowed
Funds
|
809,054
|
8,948
|
4.39
|
783,544
|
9,228
|
4.72
|
809,185
|
9,306
|
4.58
|
||
|
Total
interest-bearing liabilities
|
2,635,126
|
23,967
|
3.61%
|
2,628,367
|
22,782
|
3.48%
|
2,772,359
|
19,996
|
2.87%
|
||
|
Checking
accounts
|
93,989
|
97,731
|
93,690
|
||||||||
|
Other
non-interest-bearing liabilities
|
85,763
|
115,835
|
92,736
|
||||||||
|
Total
liabilities
|
2,814,878
|
2,841,933
|
2,958,785
|
||||||||
|
Stockholders'
equity
|
294,305
|
292,882
|
288,431
|
||||||||
|
Total
liabilities and stockholders' equity
|
$3,109,183
|
$3,134,815
|
$3,247,216
|
||||||||
|
Net
interest income
|
$18,706
|
$20,851
|
$22,346
|
||||||||
|
Net
interest spread
|
2.15%
|
2.36%
|
2.61%
|
||||||||
|
Net
interest-earning assets
|
$326,777
|
$364,405
|
$318,464
|
||||||||
|
Net
interest margin
|
2.53%
|
2.79%
|
2.89%
|
||||||||
|
Ratio
of interest-earning assets
|
|||||||||||
|
to
interest-bearing liabilities
|
112.40%
|
113.86%
|
111.49%
|
||||||||
|
Average
deposits (including non-interest
|
|||||||||||
|
bearing checking accounts)
|
$
1,920,061
|
$
15,019
|
3.10%
|
$
1,942,554
|
$
13,554
|
2.80%
|
$
2,056,864
|
$
10,690
|
2.06%
|
||