UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
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
Pursuant to Section 13 OR 15(d) of The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): January 20, 2010
CVB FINANCIAL CORP.
(Exact name of registrant as specified in its charter)
| California | 0-10140 | 95-3629339 | ||
| (State or other jurisdiction of incorporation) |
(Commission File Number) | (IRS Employer Identification No.) |
| 701 North Haven Avenue, Ontario, California |
91764 |
|
| (Address of principal executive offices) | (Zip Code) |
Registrant’s telephone number, including area code: (909) 980-4030
Not Applicable
(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:
| o | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |
| o | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |
| o | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |
| o | 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 January 21, 2010, CVB Financial Corp. issued a press release setting forth its fourth
quarter ending December 31, 2009 earnings. A copy of this press release is attached hereto as
Exhibit 99.1 and is being furnished pursuant to this Item 2.02.
2
Item 5.02(e) Departure of Directors or Certain Officers; Election of Directors; Appointment of
Certain Officers; Compensatory Arrangements of Certain Officers.
On January 20, 2010, the Compensation Committee of the Board of Directors of CVB Financial
Corp. awarded the following discretionary cash bonuses to its executive officers payable in
February 2010 in connection with work completed in 2009.
| Amount of 2009 Discretionary | ||||
| Name of Executive Officer | Cash Bonus | |||
Christopher D. Myers |
$ | 600,000 | ||
Edward J. Biebrich, Jr. |
$ | 125,000 | ||
James F. Dowd |
$ | 90,000 | ||
Todd E. Hollander |
$ | 90,000 | ||
Christopher A. Walters |
$ | 62,500 | ||
Item 9.01 Financial Statment and Exhibits
(d) Exhibits
| 99.1 | Press Release, dated January 21, 2010 |
3
SIGNATURES
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 hereunto duly authorized.
| CVB FINANCIAL CORP. (Registrant) |
||||
| Date: January 22, 2010 | By: | /s/ Edward J. Biebrich Jr. | ||
| Edward J. Biebrich Jr., | ||||
| Executive Vice President and Chief Financial Officer |
||||
4
Exhibit Index
99.1 Press Release, dated January 21, 2010
5
Exhibit 99.1
Press Release
For Immediate Release
For Immediate Release
| Contact: | Christopher D. Myers | |||
| President and CEO | ||||
| (909) 980-4030 |
CVB Financial Corp. Reports Positive Earnings for 2009
| • | Record net interest income, before provision for credit losses, of $222.3 million | ||
| • | Net income of $65.4 million for 2009 | ||
| • | Diluted earnings per common share $0.56 (Reduced by $0.14 due to TARP preferred stock dividends) | ||
| • | Deposits, including customer repos, grew $1.06 billion over December 31, 2008 | ||
| • | Allowance for credit losses 3.02% of total CBB loans & leases |
Ontario, CA, January 21, 2010-CVB Financial Corp. (NASDAQ:CVBF) and its subsidiary, Citizens
Business Bank (“the Company”), announced earnings for the year ended December 31, 2009.
CVB Financial Corp. reported net income of $65.4 million for the year ended December 31, 2009.
This represents an increase of $2.3 million, or 3.72%, when compared with net income of $63.1
million for the year ended December 31, 2008. Diluted earnings per share were $0.56 for the year
ended December 31, 2009. This was down $0.19, or 24.55%, from diluted earnings per share of $0.75
for the same period last year.
Chris Myers, President and CEO commented, “We achieved several goals in 2009: we raised $132.5
million in capital, re-paid all of our TARP funds, acquired San Joaquin Bank, increased our
allowance for loan losses by $55 million and had substantial organic deposit growth. All of these
efforts contributed to strengthening the Bank and helped us grow and prosper in this challenging
environment.”
Net income for the year ended December 31, 2009 produced a return on beginning equity of 10.64%, a
return on average equity of 10.00% and a return on average assets of 0.98%. The efficiency ratio,
excluding the provision for credit losses, the gain on sale of
securities, and the gain on acquisition, was 52.64% for the year. Operating expenses as a
percentage of average assets were 2.01%.
-1-
The Company reported net income of $17.1 million for the fourth quarter ending December 31, 2009.
This represented an increase of $4.8 million, or 39.02%, when compared with the $12.3 million in
net income reported for the fourth quarter of 2008. Diluted earnings per share were $0.16 for the
fourth quarter of 2009. This was up $0.02 from diluted earnings per share of $0.14 for the fourth
quarter of 2008. The excess of the acquired assets over assumed liabilities resulted in an
after-tax gain of $12.3 million. Fourth quarter operating results also include a $25.5 million
provision for credit losses.
Net income for the fourth quarter of 2009 produced a return on beginning equity of 10.39%, a return
on average equity of 9.99% and a return on average assets of 0.97%. The efficiency ratio,
excluding the provision for credit losses and the gain on acquisition, was 58.88%. Operating
expenses as a percentage of average assets were 2.25%.
Net Interest Income and Net Interest Margin
Net interest income, before the provision for credit losses, totaled $222.3 million for the year
ended December 31, 2009. “This represents the highest net interest income in the history of the
Company, demonstrating our ability to continue to grow top-line income,” said Chris Myers. This
represents an increase of $28.6 million, or 14.76%, compared to the same period in 2008. The
increase resulted from a $50.3 million decrease in interest expense which overshadowed a $21.7
million decrease in interest income. The decrease in interest income was primarily due to the
decrease in interest rates. The decrease in interest expense was due to the decrease in the
interest rates paid on deposits and borrowed funds, combined with a decrease in average borrowed
funds of $670.0 million.
Net interest income, before provision for credit losses, totaled $58.1 million for the fourth
quarter of 2009. This represents an increase of $6.0 million, or 11.56%, over net interest income
of $52.1 million for the same period in 2008. The increase resulted from a $8.7 million decrease in
interest expense, which overshadowed a $2.7 million decrease in interest income.
Net interest margin (tax equivalent) increased from 3.41% for the year ended December 31, 2008 to
3.75% for the year ended December 31, 2009. Total average earning asset yields decreased from
5.71% for 2008 to 5.17% for 2009. Total cost of funds decreased from 2.36% for 2008 to 1.49% for
2009. The increase in net interest margin is due to the cost of interest-bearing liabilities
decreasing faster than the decrease in yields on earning assets.
Net interest margin (tax equivalent) increased from 3.62% for the fourth quarter of 2008 to 3.80%
for the fourth quarter of 2009. Total average earning asset yields decreased from 5.60% for the
fourth quarter of 2008 to 5.15% for the fourth quarter of 2009. The cost of funds decreased from
2.04% for the fourth quarter of 2008 to 1.39% for the fourth quarter of 2009.
-2-
Assets
The Company reported total assets of $6.74 billion at December 31, 2009. This represented an
increase of $90.1 million, or 1.36%, over total assets of $6.65 billion at December 31, 2008.
Earning assets totaling $6.17 billion decreased $109.5 million, or 1.74%, when compared with
earning assets of $6.28 billion at December 31, 2008. The decrease in earnings assets was due to a
decrease in our investment portfolio. See discussion below. Total loans and leases of $4.06
billion at December 31, 2009 increased $326.8 million, or 8.75% compared to $3.74 billion at
December 31, 2008. The increase in loans was due to the SJB acquisition, which contributed $455.3
million (carrying value).
Investment Securities
Investment securities totaled $2.11 billion at December 31, 2009. This represents a decrease of
$388.0 million, or 15.52%, when compared with $2.50 billion in investment securities at December
31, 2008. During 2009, we sold certain securities with relatively short maturities and recognized
a gain on sale of securities of $28.4 million. We also recognized an other-than-temporary
impairment on a private-label mortgage-backed investment security. The total impairment of $2.0
million was reduced by $1.7 million for the non-credit portion which was reflected in other
comprehensive income. The remaining $323,000 loss was recognized as an offset to other operating
income.
Our investment portfolio continues to perform well. As of December 31, 2009 we had an unrealized
gain of $26.4 million. We have no preferred stock and no trust preferred securities. Virtually
all of our mortgage-backed securities are issued by Freddie Mac or Fannie Mae, which have the
guarantee of the U.S. Government. Except for the bond discussed above, the remaining private-label
mortgage-backed issues of approximately $30.4 million are performing well. Our municipal
securities, totaling $663.4 million, are located throughout the United States, with approximately
$40.8 million, or 6.1%, located within the state of California. All municipal bond securities are
fully performing.
Deposits & Customer Repurchases
Total deposits and customer repos were $4.92 billion at December 31, 2009. This represents an
increase of $1.06 billion, or 27.36%, when compared with total deposits and customer repos of $3.87
billion at December 31, 2008. This growth was due in part to the deposit initiatives we have been
working on over the past few years. This growth came primarily from our newly formed Specialty
Banking Group and Commercial Banking Centers.
We acquired $529.7 million in deposits from SJB. Of these deposits, $95.0 million were National
CDs with high interest rates. As we lowered those rates, we experienced an outflow of these
non-customer CDs, which was anticipated. At December 31, 2009, we had $432.0 million in deposits,
of which $157.3 million were non-interest bearing demand deposits.
-3-
Borrowings
At December 31, 2009, we had $1.01 billion in borrowings. This represents a decrease of $987.5
million, or 49.55%, from borrowings of $1.99 billion at December 31, 2008. As a result of the
increase in deposits and customer repurchases of $1.06 billion and the net decrease of $388.0
million in securities, it was possible for us to reduce our reliance on borrowed funds. In
addition, we restructured some of our FHLB advances to reduce our interest expense and protect
against a rising rate environment. In the fourth quarter of 2009, we restructured a $300 million
advance by paying-off $100 million and terming-out $200 million for seven years at a 4.52% fixed
rate. Imbedded in this fixed rate is a rate cap protecting an additional $200 million of interest
rate risk. We also prepaid another $100 million advance. The prepayment penalty for the two $100
million advances was $4.4 million, which was recognized in other operating expenses in the fourth
quarter of 2009. The prepayment penalty on the $200 million restructured advance was $1.9 million
and will be amortized to interest expense over the next seven years.
San Joaquin Bank Acquisition
On October 16, 2009, Citizens Business Bank acquired substantially all of the assets and assumed
substantially all of the liabilities of San Joaquin Bank (“SJB”) headquartered in Bakersfield,
California, in an FDIC-assisted transaction. We acquired all five SJB branches, one of which will
be consolidated into our existing Bakersfield business financial center in March 2010.
The acquisition has been accounted for under the purchase method. The assets and liabilities were
recorded at their estimated fair values as of the October 16, 2009 acquisition date. The
application of the purchase method of accounting resulted in an after-tax gain of $12.3 million
which is included in 2009 earnings. The gain is based on fair values. Such fair values are
preliminary estimates and are subject to adjustment for up to one year after the acquisition date.
The core deposit intangible of $4.9 million will be amortized over ten years.
A summary of the estimated fair value adjustments resulting in the net gain follows:
| October 16, 2009 | ||||
| (in thousands) | ||||
SJB’s cost basis net assets on October 16, 2009 |
$ | 84,279 | ||
Purchase Accounting Fair Value Adjustments |
||||
Loans |
(199,768 | ) | ||
FDIC loss sharing receivable |
131,860 | |||
Core Deposit Intangible |
4,904 | |||
Other assets |
145 | |||
Time Deposits |
(298 | ) | ||
Income tax liabliity |
(8,871 | ) | ||
Net after-tax gain from SJB acquisition |
$ | 12,251 | ||
-4-
Asset Quality
The SJB loans have a par value of $655.1 million and an adjusted carrying value of $455.3 million.
Due to the nature of the transaction and the loss guarantee from the
FDIC, we have separated the discussion of asset quality into two sections: non-covered loans and
covered loans. The non-covered loans represent the legacy Citizens Business Bank loans and exclude
all loans acquired in the SJB acquisition. The SJB loans are “covered” loans as defined in the
loss sharing agreement with the FDIC. These loans have been marked to fair value and also have a
guarantee by the FDIC. The allowance for credit losses as of December 31, 2009 pertains only to
those loans made by Citizens Business Bank and not those acquired through the San Joaquin Bank
transaction.
Citizens Business Bank Asset Quality (non-covered loans)
The allowance for credit losses increased from $55.0 million as of December 31, 2008 to $108.9
million as of December 31, 2009. The increase was primarily due to a provision for credit losses of
$80.5 million during 2009. During 2009, we had loan charge-offs totaling $26.3 million and
recoveries on previously charged-off loans of $803,000. This resulted in net charge-offs of $25.5
million. By comparison, during 2008, the Company had net charge-offs of $5.7 million and a $26.6
million provision for credit losses. The allowance for credit losses was 3.02% and 1.44% of total
loans and leases outstanding as of December 31, 2009 and 2008, respectively. “Because the economy
continues to struggle, our objective has been to increase our allowance as a percentage of total
loans. Although our losses and non-performing loans are low by comparison to peers, they have
increased. We regard the overall weakness in the economy as a driving factor in determining our
allowance,” said Myers.
We had $69.8 million in non-performing loans at December 31, 2009, or 1.93% of total loans. This
compares to non-performing loans of $17.7 million at December 31, 2008. The non-performing loans
consist of $13.9 million in residential construction and land loans, $23.8 million in commercial
construction loans, $11.8 million in single-family mortgage loans, $17.1 million in commercial real
estate loans, and $3.2 million in commercial loans.
At December 31, 2009, we had $3.9 million in Other Real Estate Owned (“OREO”). This represents a
decrease of $2.7 million from OREO of $6.6 million at December 31, 2008. At December 31, 2008, we
had 10 OREO properties. During 2009, we added nine properties for a total of $11.5 million to
OREO. During the year, we sold 17 properties with an OREO value of $14.3 million for cash proceeds
of $13.9 million. We now have two OREO properties.
At December 31, 2009, we had loans delinquent 30 to 89 days of $10.5 million. This compares to
delinquent loans of $5.2 million at December 31, 2008. As a percentage of total loans,
delinquencies, excluding non-accruals, were 0.29% at December 31, 2009 and 0.14% at December 31,
2008.
San Joaquin Bank Asset Quality (covered loans)
We acquired $688.9 million in loans from SJB. The FDIC loss threshold is $144.0 million and we
have a first loss amount of $26.7 million. We will absorb 20% of the next $117.3 million in losses
and the FDIC will absorb 80% of the losses. Thereafter, we will absorb 5% of the losses and the
FDIC will absorb 95% of the losses. We have recorded
these estimated future losses as a discount to loans acquired at the acquisition date. As such, we
don’t expect these losses to have a significant impact to future earnings.
-5-
At December 31, 2009 we had $655.1 million in gross loans from SJB with a carrying value of $455.3
million. Of the gross loans, we have $163.2 million in non-accrual and $23.2 million in loans
delinquent 30 to 89 days. Non-accrual loans represent 24.92% of gross loans and delinquent loans
represent 3.54%. We have taken two properties into OREO totaling $5.6 million.
CitizensTrust
CitizensTrust has approximately $1.9 billion in assets under administration, including $1.0 billion
in assets under management, as of December 31, 2009. This compares with $1.8 billion in assets
under administration, including $782.4 million in assets under management at December 31, 2008.
CitizensTrust provides trust, investment and brokerage related services, as well as financial,
estate and business succession planning.
Corporate Overview
CVB Financial Corp. is the holding company for Citizens Business Bank, a financial services company
based in Ontario, California. Citizens Business Bank serves 40 cities with 46 business financial
centers and 5 commercial banking centers in the Inland Empire, Los Angeles County, Orange County
and the Central Valley areas of California.
Shares of CVB Financial Corp. common stock are listed on the NASDAQ under the ticker symbol of
CVBF. For investor information on CVB Financial Corp., visit our Citizens Business Bank website at
www.cbbank.com and click on the CVB Investor tab.
Safe Harbor
Certain matters set forth herein (including the exhibits hereto) constitute forward-looking
statements within the meaning of the Private Securities Litigation Reform Act of 1995, including
forward-looking statements relating to the Company’s current business plan and expectations
regarding future operating results. These forward-looking statements are subject to risks and
uncertainties that could cause actual results, performance or achievements to differ materially
from those projected. These risks and uncertainties include, but are not limited to, local,
regional, national and international economic conditions and events and the impact they may have on
us and our customers; ability to attract deposits and other sources of liquidity; oversupply of
inventory and continued deterioration in values of California real estate, both residential and
commercial; a prolonged slowdown in construction activity; changes in the financial performance
and/or condition of our borrowers; changes in the level of non-performing assets and charge-offs;
ability to repurchase our securities issued to the U.S. Treasury pursuant to its Capital Purchase
Program; the effect of changes in laws and regulations (including laws and regulations concerning
taxes, banking, securities, executive compensation and insurance) with which we and our
subsidiaries must comply; changes in estimates of future reserve requirements based upon the
periodic review thereof under relevant regulatory and accounting requirements; inflation, interest
rate, securities market and
-6-
monetary fluctuations; political instability; acts of war or terrorism, or natural disasters, such
as earthquakes, or the effects of pandemic flu; the timely development and acceptance of new
banking products and services and perceived overall value of these products and services by users;
changes in consumer spending, borrowing and savings habits; technological changes; the ability to
increase market share and control expenses; changes in the competitive environment among financial
and bank holding companies and other financial service providers; continued volatility in the
credit and equity markets and its effect on the general economy; the effect of changes in
accounting policies and practices, as may be adopted by the regulatory agencies, as well as the
Public Company Accounting Oversight Board, the Financial Accounting Standards Board and other
accounting standard setters; changes in our organization, management, compensation and benefit
plans; the costs and effects of legal and regulatory developments including the resolution of legal
proceedings or regulatory or other governmental inquiries and the results of regulatory
examinations or reviews; our success at managing the risks involved in the foregoing items and
other factors set forth in the Company’s public reports including its Annual Report on Form 10-K
for the year ended December 31, 2008, and particularly the discussion of risk factors within that
document. The Company does not undertake, and specifically disclaims any obligation to update any
forward-looking statements to reflect occurrences or unanticipated events or circumstances after
the date of such statements except as required by law.
###
-7-
CVB FINANCIAL CORP. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET
(unaudited)
dollars in thousands
CONSOLIDATED BALANCE SHEET
(unaudited)
dollars in thousands
| December 31, | ||||||||
| 2009 | 2008 | |||||||
Assets: |
||||||||
Cash and due from banks |
$ | 103,254 | $ | 95,297 | ||||
Investment Securities available-for-sale |
2,108,463 | 2,493,476 | ||||||
Investment Securities held-to-maturity |
3,838 | 6,867 | ||||||
Federal funds sold and Interest-bearing balances due
from depository institutions |
1,226 | 285 | ||||||
Investment in stock of Federal Home Loan Bank (FHLB) |
97,582 | 93,240 | ||||||
Loans held-for-sale |
1,439 | |||||||
Loans and lease finance receivables |
4,063,664 | 3,736,838 | ||||||
Less allowance for credit losses |
(108,924 | ) | (53,960 | ) | ||||
Net loans and lease finance receivables |
3,954,740 | 3,682,878 | ||||||
Total earning assets |
6,167,288 | 6,276,746 | ||||||
Premises and equipment, net |
41,444 | 44,420 | ||||||
Intangibles |
12,761 | 11,020 | ||||||
Goodwill |
55,097 | 55,097 | ||||||
Cash value of life insurance |
109,480 | 106,366 | ||||||
Other assets |
250,445 | 60,705 | ||||||
TOTAL |
$ | 6,739,769 | $ | 6,649,651 | ||||
Liabilities and Stockholders’ Equity |
||||||||
Liabilities: |
||||||||
Deposits: |
||||||||
Demand Deposits (noninterest-bearing) |
$ | 1,561,981 | $ | 1,334,248 | ||||
Investment Checking |
469,413 | 324,907 | ||||||
Savings/MMDA |
1,213,002 | 818,872 | ||||||
Time Deposits |
1,194,258 | 1,030,129 | ||||||
Total Deposits |
4,438,654 | 3,508,156 | ||||||
Demand Note to U.S. Treasury |
2,425 | 5,373 | ||||||
Customer Repurchase Agreements |
485,132 | 357,813 | ||||||
Repurchase Agreements |
250,000 | 250,000 | ||||||
Borrowings |
753,118 | 1,737,660 | ||||||
Junior Subordinated Debentures |
115,055 | 115,055 | ||||||
Other liabilities |
57,157 | 60,702 | ||||||
Total Liabilities |
6,101,541 | 6,034,759 | ||||||
Stockholders’ equity: |
||||||||
Stockholders’ equity |
611,838 | 586,161 | ||||||
Accumulated other comprehensive income
(loss), net of tax |
26,390 | 28,731 | ||||||
| 638,228 | 614,892 | |||||||
TOTAL |
$ | 6,739,769 | $ | 6,649,651 | ||||
CVB FINANCIAL CORP. AND SUBSIDIARIES
CONSOLIDATED AVERAGE BALANCE SHEET
(unaudited)
dollars in thousands
CONSOLIDATED AVERAGE BALANCE SHEET
(unaudited)
dollars in thousands
| Three months ended December 31, | Twelve months ended December 31, | |||||||||||||||
| 2009 | 2008 | 2009 | 2008 | |||||||||||||
Assets: |
||||||||||||||||
Cash and due from banks |
$ | 228,178 | $ | 96,335 | $ | 156,993 | $ | 101,282 | ||||||||
Investment securities available-for-sale |
2,200,226 | 2,370,784 | 2,321,956 | 2,435,129 | ||||||||||||
Investment securities held-to-maturity |
4,055 | 6,948 | 5,826 | 6,934 | ||||||||||||
Federal funds sold and Interest-bearing balances
due from depository institutions |
98,492 | 349 | 76,274 | 1,086 | ||||||||||||
Investment in stock of Federal Home Loan Bank (FHLB) |
96,213 | 92,856 | 93,989 | 89,601 | ||||||||||||
Loans held-for-sale |
605 | — | 153 | — | ||||||||||||
Loans and lease finance receivables |
3,997,884 | 3,645,278 | 3,735,339 | 3,506,510 | ||||||||||||
Less allowance for credit losses |
(92,611 | ) | (40,893 | ) | (77,670 | ) | (37,280 | ) | ||||||||
Net loans and lease finance receivables |
3,905,273 | 3,604,385 | 3,657,669 | 3,469,230 | ||||||||||||
Total earning assets |
6,304,864 | 6,075,322 | 6,155,867 | 6,001,980 | ||||||||||||
Premises and equipment, net |
42,082 | 44,263 | 43,266 | 45,494 | ||||||||||||
Intangibles |
12,417 | 11,366 | 10,444 | 12,709 | ||||||||||||
Goodwill |
55,097 | 55,097 | 55,097 | 55,105 | ||||||||||||
Cash value of life insurance |
109,075 | 106,172 | 107,933 | 105,228 | ||||||||||||
Other assets |
202,246 | 89,385 | 112,890 | 73,115 | ||||||||||||
TOTAL |
$ | 6,953,959 | $ | 6,477,940 | $ | 6,642,490 | $ | 6,394,913 | ||||||||
Liabilities and Stockholders’ Equity |
||||||||||||||||
Liabilities: |
||||||||||||||||
Deposits: |
||||||||||||||||
Noninterest-bearing |
$ | 1,573,039 | $ | 1,300,431 | $ | 1,431,204 | $ | 1,268,548 | ||||||||
Interest-bearing |
2,877,983 | 2,050,643 | 2,561,734 | 2,008,637 | ||||||||||||
Total Deposits |
4,451,022 | 3,351,074 | 3,992,938 | 3,277,185 | ||||||||||||
Other borrowings |
1,644,925 | 2,460,252 | 1,812,873 | 2,482,888 | ||||||||||||
Junior Subordinated Debentures |
115,055 | 115,055 | 115,055 | 115,055 | ||||||||||||
Other liabilities |
65,221 | 65,052 | 67,746 | 61,119 | ||||||||||||
Total Liabilities |
6,276,223 | 5,991,433 | 5,988,612 | 5,936,247 | ||||||||||||
Stockholders’ equity: |
||||||||||||||||
Stockholders’ equity |
631,059 | 502,247 | 620,083 | 457,427 | ||||||||||||
Accumulated other comprehensive income
(loss), net of tax |
46,677 | (15,740 | ) | 33,795 | 1,239 | |||||||||||
| 677,736 | 486,507 | 653,878 | 458,666 | |||||||||||||
TOTAL |
$ | 6,953,959 | $ | 6,477,940 | $ | 6,642,490 | $ | 6,394,913 | ||||||||
CVB FINANCIAL CORP. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF EARNINGS
(unaudited)
dollar amounts in thousands, except per share
CONSOLIDATED STATEMENTS OF EARNINGS
(unaudited)
dollar amounts in thousands, except per share
| For the Three Months | For the Twelve Months | |||||||||||||||
| Ended December 31, | Ended December 31, | |||||||||||||||
| 2009 | 2008 | 2009 | 2008 | |||||||||||||
Interest Income: |
||||||||||||||||
Loans held-for-sale |
$ | 5 | $ | — | $ | 5 | $ | — | ||||||||
Loans and leases, including fees |
56,217 | 53,416 | 206,074 | 212,626 | ||||||||||||
Investment securities: |
||||||||||||||||
Taxable |
16,950 | 21,482 | 76,798 | 86,930 | ||||||||||||
Tax-advantaged |
6,769 | 7,035 | 27,329 | 28,371 | ||||||||||||
Total investment income |
23,719 | 28,517 | 104,127 | 115,301 | ||||||||||||
Dividends from FHLB Stock |
— | 886 | 195 | 4,552 | ||||||||||||
Federal funds sold & Interest-bearing CDs with other
institutions |
162 | 4 | 358 | 39 | ||||||||||||
Total interest income |
80,103 | 82,823 | 310,759 | 332,518 | ||||||||||||
Interest Expense: |
||||||||||||||||
Deposits |
5,993 | 7,569 | 24,956 | 35,801 | ||||||||||||
Borrowings and junior subordinated debentures |
16,039 | 23,200 | 63,539 | 103,038 | ||||||||||||
Total interest expense |
22,032 | 30,769 | 88,495 | 138,839 | ||||||||||||
Net interest income before provision for credit losses |
58,071 | 52,054 | 222,264 | 193,679 | ||||||||||||
Provision for credit losses |
25,500 | 17,900 | 80,500 | 26,600 | ||||||||||||
Net interest income after
provision for credit losses |
32,571 | 34,154 | 141,764 | 167,079 | ||||||||||||
Other Operating Income: |
||||||||||||||||
Impairment loss on investment securities |
(144 | ) | — | (1,994 | ) | — | ||||||||||
Less: Noncredit-related impairment loss recorded
in other comprehensive income |
53 | — | 1,671 | — | ||||||||||||
Net impairment loss on investment securities
recognized in earnings |
(91 | ) | — | (323 | ) | — | ||||||||||
Service charges on deposit accounts |
3,809 | 3,848 | 14,889 | 15,228 | ||||||||||||
Trust and investment services |
1,709 | 2,020 | 6,657 | 7,926 | ||||||||||||
Gain on sale of investment securities |
— | — | 28,446 | — | ||||||||||||
Other |
24,476 | 3,374 | 31,402 | 11,303 | ||||||||||||
Total other operating income |
29,903 | 9,242 | 81,071 | 34,457 | ||||||||||||
Other operating expenses: |
||||||||||||||||
Salaries and employee benefits |
16,172 | 14,284 | 62,985 | 61,271 | ||||||||||||
Occupancy |
3,334 | 2,939 | 11,649 | 11,813 | ||||||||||||
Equipment |
1,828 | 1,606 | 6,712 | 7,162 | ||||||||||||
Professional services |
1,967 | 1,504 | 6,965 | 6,519 | ||||||||||||
Amortization of intangible assets |
906 | 898 | 3,163 | 3,591 | ||||||||||||
Provision for unfunded commitments |
1,950 | 150 | 3,750 | 1,300 | ||||||||||||
OREO Expense |
13 | 89 | 1,211 | 89 | ||||||||||||
Other |
13,195 | 6,484 | 37,151 | 24,043 | ||||||||||||
Total other operating expenses |
39,365 | 27,954 | 133,586 | 115,788 | ||||||||||||
Earnings before income taxes |
23,109 | 15,442 | 89,249 | 85,748 | ||||||||||||
Income taxes |
6,041 | 3,165 | 23,830 | 22,675 | ||||||||||||
Net earnings |
$ | 17,068 | $ | 12,277 | $ | 65,419 | $ | 63,073 | ||||||||
Basic earnings per common share |
$ | 0.16 | $ | 0.14 | $ | 0.56 | $ | 0.75 | ||||||||
Diluted earnings per common share |
$ | 0.16 | $ | 0.14 | $ | 0.56 | $ | 0.75 | ||||||||
Cash dividends per common share |
$ | 0.085 | $ | 0.085 | $ | 0.340 | $ | 0.340 | ||||||||
CVB FINANCIAL CORP. AND SUBSIDIARIES
SELECTED FINANCIAL HIGHLIGHTS
(unaudited)
SELECTED FINANCIAL HIGHLIGHTS
(unaudited)
| Three months ended December 31, | Twelve months ended December 31, | |||||||||||||||
| 2009 | 2008 | 2009 | 2008 | |||||||||||||
Interest income — (Tax-Effected) (te) |
$ | 82,870 | $ | 85,684 | $ | 321,917 | $ | 344,040 | ||||||||
Interest Expense |
22,032 | 30,769 | 88,495 | 138,839 | ||||||||||||
Net Interest income — (te) |
$ | 60,838 | $ | 54,915 | $ | 233,422 | $ | 205,201 | ||||||||
Return on average assets |
0.97 | % | 0.75 | % | 0.98 | % | 0.99 | % | ||||||||
Return on average equity |
9.99 | % | 10.04 | % | 10.00 | % | 13.75 | % | ||||||||
Efficiency ratio |
63.01 | % | 64.42 | % | 59.95 | % | 57.45 | % | ||||||||
Net interest margin (te) |
3.80 | % | 3.62 | % | 3.75 | % | 3.41 | % | ||||||||
Weighted average shares outstanding |
||||||||||||||||
Basic |
105,902,311 | 83,165,763 | 92,955,172 | 83,120,817 | ||||||||||||
Diluted |
106,023,730 | 83,383,653 | 93,055,801 | 83,335,503 | ||||||||||||
Dividends declared |
$ | 9,054 | $ | 7,078 | $ | 32,228 | $ | 28,317 | ||||||||
Dividend payout ratio |
53.05 | % | 57.65 | % | 49.26 | % | 44.90 | % | ||||||||
Number of shares outstanding-EOP |
106,231,511 | 83,270,263 | ||||||||||||||
Book value per share |
$ | 6.01 | $ | 5.92 | ||||||||||||
| December 31, | ||||||||
| 2009 | 2008 | |||||||
(Non-covered loans) |
||||||||
Non-performing Assets (dollar amount in thousands): |
||||||||
Non-accrual loans |
$ | 69,779 | $ | 17,684 | ||||
Loans past due 90 days or more
and still accruing interest |
— | — | ||||||
Other real estate owned (OREO), net |
3,936 | 6,565 | ||||||
Total non-performing assets |
$ | 73,715 | $ | 24,249 | ||||
Percentage of non-performing assets
to total loans outstanding and OREO |
1.81 | % | 0.65 | % | ||||
Percentage of non-performing
assets to total assets |
1.09 | % | 0.36 | % | ||||
Allowance for loan losses to
non-performing assets |
147.76 | % | 222.52 | % | ||||
Net Charge-off to Average loans |
0.68 | % | 0.16 | % | ||||
Allowance for Credit Losses: |
||||||||
Beginning Balance |
$ | 53,960 | $ | 33,049 | ||||
Total Loans Charged-Off |
(26,339 | ) | (6,037 | ) | ||||
Total Loans Recovered |
803 | 348 | ||||||
Net Loans Charged-off |
(25,536 | ) | (5,689 | ) | ||||
Provision Charged to Operating Expense |
80,500 | 26,600 | ||||||
Allowance for Credit Losses at End of period |
$ | 108,924 | $ | 53,960 | ||||
CVB FINANCIAL CORP. AND SUBSIDIARIES
SELECTED FINANCIAL HIGHLIGHTS
(in thousands, except per share data)
SELECTED FINANCIAL HIGHLIGHTS
(in thousands, except per share data)
(unaudited)
Quarterly Common Stock Price
| 2009 | 2008 | 2007 | ||||||||||||||||||||||
| Quarter End | High | Low | High | Low | High | Low | ||||||||||||||||||
March 31, |
$ | 12.11 | $ | 5.31 | $ | 11.20 | $ | 8.45 | $ | 13.38 | $ | 11.42 | ||||||||||||
June 30, |
$ | 7.77 | $ | 5.69 | $ | 12.10 | $ | 9.44 | $ | 12.40 | $ | 10.63 | ||||||||||||
September 30, |
$ | 8.70 | $ | 4.90 | $ | 15.01 | $ | 7.65 | $ | 12.71 | $ | 9.51 | ||||||||||||
December 31, |
$ | 9.00 | $ | 6.93 | $ | 13.89 | $ | 9.29 | $ | 11.97 | $ | 9.98 | ||||||||||||
Quarterly Consolidated Statements of Earnings
| 4Q | 3Q | 2Q | 1Q | 4Q | ||||||||||||||||
| 2009 | 2009 | 2009 | 2009 | 2008 | ||||||||||||||||
Interest income |
||||||||||||||||||||
Loans, including fees |
$ | 56,222 | $ | 50,561 | $ | 49,771 | $ | 49,526 | $ | 53,416 | ||||||||||
Investment securities and federal funds sold |
23,881 | 25,358 | 26,004 | 29,436 | 29,407 | |||||||||||||||
| 80,103 | 75,919 | 75,775 | 78,962 | 82,823 | ||||||||||||||||
Interest expense |
||||||||||||||||||||
Deposits |
5,993 | 5,934 | 6,439 | 6,590 | 7,569 | |||||||||||||||
Other borrowings |
16,039 | 15,179 | 15,241 | 17,080 | 23,200 | |||||||||||||||
| 22,032 | 21,113 | 21,680 | 23,670 | 30,769 | ||||||||||||||||
Net interest income before
provision for credit losses |
58,071 | 54,806 | 54,095 | 55,292 | 52,054 | |||||||||||||||
Provision for credit losses |
25,500 | 13,000 | 20,000 | 22,000 | 17,900 | |||||||||||||||
Net interest income after
provision for credit losses |
32,571 | 41,806 | 34,095 | 33,292 | 34,154 | |||||||||||||||
Non-interest income |
29,903 | 15,102 | 19,709 | 16,357 | 9,242 | |||||||||||||||
Non-interest expenses |
39,365 | 29,845 | 32,979 | 31,397 | 27,954 | |||||||||||||||
Earnings before income taxes |
23,109 | 27,063 | 20,825 | 18,252 | 15,442 | |||||||||||||||
Income taxes |
6,041 | 7,741 | 4,964 | 5,084 | 3,165 | |||||||||||||||
Net earnings |
$ | 17,068 | $ | 19,322 | $ | 15,861 | $ | 13,168 | $ | 12,277 | ||||||||||
Basic earning per common share |
$ | 0.16 | $ | 0.10 | $ | 0.17 | $ | 0.13 | $ | 0.14 | ||||||||||
Diluted earnings per common share |
$ | 0.16 | $ | 0.10 | $ | 0.17 | $ | 0.13 | $ | 0.14 | ||||||||||
Cash dividends per common share |
$ | 0.085 | $ | 0.085 | $ | 0.085 | $ | 0.085 | $ | 0.085 | ||||||||||
Dividends Declared |
$ | 9,054 | $ | 9,012 | $ | 7,079 | $ | 7,083 | $ | 7,078 | ||||||||||
CVB FINANCIAL CORP. AND SUBSIDIARIES
SELECTED FINANCIAL HIGHLIGHTS
(in thousands)
(unaudited)
SELECTED FINANCIAL HIGHLIGHTS
(in thousands)
(unaudited)
Distribution of Loan Portfolio
(Non-covered loans)
(Non-covered loans)
| 12/31/2009 | 9/30/2009 | 6/30/2009 | 3/31/2009 | 12/31/2008 | ||||||||||||||||
Commercial and Industrial |
$ | 413,715 | $ | 385,274 | $ | 372,162 | $ | 355,591 | $ | 370,829 | ||||||||||
Real Estate: |
||||||||||||||||||||
Construction |
265,444 | 295,315 | 303,629 | 333,234 | 351,543 | |||||||||||||||
Commercial Real Estate |
1,989,644 | 1,959,725 | 1,964,258 | 1,965,531 | 1,945,706 | |||||||||||||||
SFR Mortgage |
265,543 | 290,831 | 306,225 | 328,145 | 333,931 | |||||||||||||||
Consumer |
67,693 | 67,317 | 67,947 | 69,708 | 66,255 | |||||||||||||||
Municipal lease finance receivables |
159,582 | 162,962 | 165,527 | 169,230 | 172,973 | |||||||||||||||
Auto and equipment leases |
30,337 | 34,072 | 37,242 | 41,708 | 45,465 | |||||||||||||||
Dairy and Livestock |
422,958 | 411,574 | 405,427 | 404,090 | 459,329 | |||||||||||||||
Gross Loans |
3,614,916 | 3,607,070 | 3,622,417 | 3,667,237 | 3,746,031 | |||||||||||||||
Less: |
||||||||||||||||||||
Deferred net loan fees |
(6,537 | ) | (6,983 | ) | (7,661 | ) | (8,378 | ) | (9,193 | ) | ||||||||||
Allowance for credit losses |
(108,924 | ) | (87,316 | ) | (74,755 | ) | (65,755 | ) | (53,960 | ) | ||||||||||
Net Loans |
$ | 3,499,455 | $ | 3,512,771 | $ | 3,540,001 | $ | 3,593,104 | $ | 3,682,878 | ||||||||||
CVB FINANCIAL CORP. AND SUBSIDIARIES
SELECTED FINANCIAL HIGHLIGHTS
(in thousands)
(unaudited)
SELECTED FINANCIAL HIGHLIGHTS
(in thousands)
(unaudited)
Non-Performing Assets & Delinquency Trends
| Total | Covered Loans | Non-covered loans | ||||||||||||||||||||||||||
| December 31, | December 31, | December 31, | September 30, | June 30, | March 31, | December 31, | ||||||||||||||||||||||
| 2009 | 2009 | 2009 | 2009 | 2009 | 2009 | 2008 | ||||||||||||||||||||||
Non-Performing Loans |
||||||||||||||||||||||||||||
Residential Construction and Land |
$ | 35,049 | $ | 21,206 | $ | 13,843 | $ | 15,729 | $ | 17,348 | $ | 20,943 | $ | 7,524 | ||||||||||||||
Commercial Construction |
84,632 | 60,800 | 23,832 | 19,636 | 21,270 | 22,102 | — | |||||||||||||||||||||
Residential Mortgage |
15,205 | 3,418 | 11,787 | 8,102 | 4,632 | 2,203 | 3,116 | |||||||||||||||||||||
Commercial Real Estate |
86,843 | 69,714 | 17,129 | 13,522 | 7,041 | 1,661 | 4,658 | |||||||||||||||||||||
Commercial and Industrial |
11,256 | 8,083 | 3,173 | 1,045 | 859 | 792 | 2,074 | |||||||||||||||||||||
Consumer |
15 | — | 15 | 100 | 115 | 336 | 312 | |||||||||||||||||||||
Total |
$ | 233,000 | $ | 163,221 | $ | 69,779 | $ | 58,134 | $ | 51,265 | $ | 48,037 | $ | 17,684 | ||||||||||||||
% of Total Loans |
5.46 | % | 24.92 | % | 1.93 | % | 1.61 | % | 1.42 | % | 1.31 | % | 0.47 | % | ||||||||||||||
Past Due 30-89 Days |
||||||||||||||||||||||||||||
Residential Construction and Land |
$ | 369 | $ | 369 | $ | — | $ | — | $ | — | $ | — | $ | — | ||||||||||||||
Commercial Construction |
13,089 | 13,089 | — | — | — | — | — | |||||||||||||||||||||
Residential Mortgage |
5,203 | 282 | 4,921 | 1,510 | 2,069 | 3,814 | 1,931 | |||||||||||||||||||||
Commercial Real Estate |
10,603 | 8,196 | 2,407 | 190 | 1,074 | 8,341 | 2,402 | |||||||||||||||||||||
Commercial and Industrial |
4,254 | 1,281 | 2,973 | 5,094 | 590 | 1,720 | 592 | |||||||||||||||||||||
Dairy & Livestock |
— | — | — | — | 3,551 | — | — | |||||||||||||||||||||
Consumer |
239 | — | 239 | 87 | 8 | 62 | 231 | |||||||||||||||||||||
Total |
$ | 33,757 | $ | 23,217 | $ | 10,540 | $ | 6,881 | $ | 7,292 | $ | 13,937 | $ | 5,156 | ||||||||||||||
% of Total Loans |
0.79 | % | 3.54 | % | 0.29 | % | 0.19 | % | 0.20 | % | 0.38 | % | 0.14 | % | ||||||||||||||
OREO |
||||||||||||||||||||||||||||
Residential Construction and Land |
$ | 75 | $ | 75 | $ | — | $ | 1,137 | $ | 1,789 | $ | 2,416 | $ | 6,158 | ||||||||||||||
Commercial Construction |
5,490 | 5,490 | — | — | — | — | — | |||||||||||||||||||||
Commercial Real Estate |
— | — | — | — | 1,187 | 4,612 | 87 | |||||||||||||||||||||
Commercial and Industrial |
3,936 | — | 3,936 | — | 893 | 893 | — | |||||||||||||||||||||
Residential Mortgage |
— | — | — | — | — | 745 | 320 | |||||||||||||||||||||
Consumer |
— | — | — | — | 166 | — | — | |||||||||||||||||||||
Total |
$ | 9,501 | $ | 5,565 | $ | 3,936 | $ | 1,137 | $ | 4,035 | $ | 8,666 | $ | 6,565 | ||||||||||||||
Total Non-Performing, Past Due & OREO |
$ | 276,258 | $ | 192,003 | $ | 84,255 | $ | 66,152 | $ | 62,592 | $ | 70,640 | $ | 29,405 | ||||||||||||||
% of Total Loans |
6.47 | % | 29.31 | % | 2.33 | % | 1.84 | % | 1.73 | % | 1.93 | % | 0.79 | % | ||||||||||||||