R
|
QUARTERLY
REPORT PURSUANT TO SECTION 13 OR
15(d)
|
|
OF
THE SECURITIES EXCHANGE ACT OF 1934
|
£
|
TRANSITION
REPORT PURSUANT TO SECTION 13 OR
15(d)
|
|
OF
THE SECURITIES EXCHANGE ACT OF 1934
|
IMPERIAL
CAPITAL BANCORP, INC.
|
||
(Exact Name
of Registrant as Specified in its Charter)
|
Delaware
|
95-4596322
|
|
(State or
Other Jurisdiction of Incorporation or
Organization)
|
(IRS
Employer Identification No.)
|
|
888
Prospect St., Suite 110, La Jolla, California
|
92037
|
|
(Address of
Principal Executive Offices)
|
(Zip
Code)
|
(858)
551-0511
|
(Registrant’s
Telephone Number, Including Area
Code)
|
Indicate
by check mark whether the registrant (1) has filed all reports required to
be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934
during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days. Yes R No
£.
|
Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer or a smaller reporting company.
See definitions of “larger accelerated filer,” “accelerated filer” and
“small reporting company” in Rule 12b-2 of the Exchange Act.
Large
Accelerated Filer £ Accelerated
Filer R
Non-Accelerated
Filer £ (Do not
check if a smaller reporting company) Smaller reporting
company £
|
Indicate
by check mark whether the Registrant is a shell company (as
defined in Rule 12b-2 of the Exchange Act). Yes £ No
R.
|
Number
of shares of common stock of the registrant: 5,428,760 outstanding as of
July 25, 2008.
|
3
|
||
4
|
||
5
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||
6
|
||
14
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||
30
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||
31
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||
32
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||
32
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||
33
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||
34
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34
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||
34
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||
34
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35
|
IMPERIAL CAPITAL BANCORP, INC. AND
SUBSIDIARIES
|
||||||||
CONSOLIDATED
BALANCE SHEETS
|
||||||||
June
30,
|
||||||||
2008
|
December
31,
|
|||||||
(unaudited)
|
2007
|
|||||||
(in
thousands, except share data)
|
||||||||
Assets
|
||||||||
Cash
and cash equivalents
|
$ | 4,922 | $ | 8,944 | ||||
Investment
securities available-for-sale, at fair value
|
106,434 | 117,924 | ||||||
Investment
securities held-to-maturity, at amortized cost
|
914,433 | 159,023 | ||||||
Stock
in Federal Home Loan Bank
|
62,025 | 53,497 | ||||||
Loans,
net (net of allowance for loan losses of $51,159 and $47,783 as
of June 30, 2008 and December 31, 2007, respectively)
|
2,914,301 | 3,125,072 | ||||||
Interest
receivable
|
22,044 | 20,841 | ||||||
Other
real estate and other assets owned, net
|
20,912 | 19,396 | ||||||
Premises
and equipment, net
|
8,745 | 8,550 | ||||||
Deferred
income taxes
|
13,651 | 12,148 | ||||||
Other
assets
|
32,715 | 25,824 | ||||||
Total
assets
|
$ | 4,100,182 | $ | 3,551,219 | ||||
Liabilities
and Shareholders’ Equity
|
||||||||
Liabilities:
|
||||||||
Deposit
accounts
|
$ | 2,492,526 | $ | 2,181,858 | ||||
Federal
Home Loan Bank advances and other borrowings
|
1,260,707 | 1,021,235 | ||||||
Accounts
payable and other liabilities
|
34,433 | 33,959 | ||||||
Junior
subordinated debentures
|
86,600 | 86,600 | ||||||
Total
liabilities
|
3,874,266 | 3,323,652 | ||||||
Commitments
and contingencies
|
||||||||
Shareholders’
equity:
|
||||||||
Preferred
stock, 5,000,000 shares authorized, none issued
|
— | — | ||||||
Contributed
capital - common stock, $.01 par value; 20,000,000 shares authorized,
9,146,256 and 9,142,256 issued as of June 30, 2008 and December 31, 2007,
respectively
|
85,286 | 85,009 | ||||||
Retained
earnings
|
258,126 | 255,947 | ||||||
Accumulated
other comprehensive (loss) income, net
|
(1,956 | ) | 267 | |||||
341,456 | 341,223 | |||||||
Less
treasury stock, at cost 4,112,832 and 3,995,634 shares as of June
30, 2008 and December 31, 2007, respectively
|
(115,540 | ) | (113,656 | ) | ||||
Total
shareholders' equity
|
225,916 | 227,567 | ||||||
Total
liabilities and shareholders' equity
|
$ | 4,100,182 | $ | 3,551,219 |
IMPERIAL CAPITAL BANCORP, INC. AND
SUBSIDIARIES
|
CONSOLIDATED
STATEMENTS OF INCOME
|
(Unaudited)
|
For
the Three Months Ended June 30,
|
For
the Six Months Ended June
30,
|
|||||||||||||||
2008
|
2007
|
2008
|
2007
|
|||||||||||||
(in
thousands, except per share data)
|
||||||||||||||||
Interest
income:
|
||||||||||||||||
Loans,
including fees
|
$ | 49,921 | $ | 58,464 | $ | 104,756 | $ | 117,227 | ||||||||
Cash
and investment securities
|
13,446 | 4,519 | 17,695 | 9,088 | ||||||||||||
Total
interest income
|
63,367 | 62,983 | 122,451 | 126,315 | ||||||||||||
Interest
expense:
|
||||||||||||||||
Deposit
accounts
|
24,302 | 27,485 | 49,385 | 54,073 | ||||||||||||
Federal
Home Loan Bank advances and other borrowings
|
12,494 | 11,593 | 24,412 | 22,270 | ||||||||||||
Junior
subordinated debentures
|
1,798 | 2,088 | 3,803 | 4,166 | ||||||||||||
Total
interest expense
|
38,594 | 41,166 | 77,600 | 80,509 | ||||||||||||
Net
interest income before provision for loan losses
|
24,773 | 21,817 | 44,851 | 45,806 | ||||||||||||
Provision
for loan losses
|
6,250 | 500 | 10,500 | 1,250 | ||||||||||||
Net
interest income after provision for loan losses
|
18,523 | 21,317 | 34,351 | 44,556 | ||||||||||||
Non-interest
income:
|
||||||||||||||||
Late
and collection fees
|
196 | 236 | 415 | 539 | ||||||||||||
Loss
on sale of loans
|
(531 | ) | — | (479 | ) | — | ||||||||||
Other
|
(814 | ) | 607 | (817 | ) | 1,020 | ||||||||||
Total
non-interest income
|
(1,149 | ) | 843 | (881 | ) | 1,559 | ||||||||||
Non-interest
expense:
|
||||||||||||||||
Compensation
and benefits
|
5,695 | 5,056 | 12,559 | 11,238 | ||||||||||||
Occupancy
and equipment
|
1,914 | 1,998 | 3,856 | 3,941 | ||||||||||||
Other
|
5,081 | 4,849 | 9,765 | 9,145 | ||||||||||||
Total
general and administrative
|
12,690 | 11,903 | 26,180 | 24,324 | ||||||||||||
Real
estate and other assets owned expense, net
|
259 | 195 | 687 | 358 | ||||||||||||
Provision
for losses on real estate and other assets owned
|
478 | — | 1,105 | — | ||||||||||||
Loss
on sale of real estate and other assets owned, net
|
63 | — | 463 | — | ||||||||||||
Total
real estate and other assets owned expense, net
|
800 | 195 | 2,255 | 358 | ||||||||||||
Total
non-interest expense
|
13,490 | 12,098 | 28,435 | 24,682 | ||||||||||||
Income
before provision for income taxes
|
3,884 | 10,062 | 5,035 | 21,433 | ||||||||||||
Provision
for income taxes
|
1,534 | 4,024 | 1,988 | 8,658 | ||||||||||||
NET
INCOME
|
$ | 2,350 | $ | 6,038 | $ | 3,047 | $ | 12,775 | ||||||||
Basic
earnings per share
|
$ | 0.43 | $ | 1.10 | $ | 0.56 | $ | 2.32 | ||||||||
Diluted
earnings per share
|
$ | 0.43 | $ | 1.08 | $ | 0.56 | $ | 2.26 | ||||||||
Dividends
declared per share of common stock
|
$ | — | $ | 0.16 | $ | 0.16 | $ | 0.32 | ||||||||
IMPERIAL CAPITAL BANCORP, INC. AND
SUBSIDIARIES
|
||||||||
CONSOLIDATED
STATEMENTS OF CASH FLOWS
|
||||||||
(Unaudited)
|
||||||||
For
the Six Months Ended June
30,
|
||||||||
2008
|
2007
|
|||||||
(in
thousands)
|
||||||||
Cash
Flows From Operating Activities:
|
||||||||
Net
Income
|
$ | 3,047 | $ | 12,775 | ||||
Adjustments
to reconcile net income to net cash provided by operating
activities:
|
||||||||
Depreciation
and amortization of premises and equipment
|
1,458 | 1,495 | ||||||
(Accretion)
amortization of discounts and premiums on loans and investment
securities
|
(985 | ) | 2,327 | |||||
Accretion
of deferred loan origination fees, net of costs
|
(820 | ) | (1,389 | ) | ||||
Provision
for loan losses
|
10,500 | 1,250 | ||||||
Provision
for losses on other real estate owned
|
1,105 | — | ||||||
Other,
net
|
(481 | ) | (1,186 | ) | ||||
(Increase)
decrease in interest receivable
|
(1,203 | ) | 223 | |||||
(Increase)
decrease in other assets
|
(6,891 | ) | 369 | |||||
Increase
(decrease) in accounts payable and other liabilities
|
474 | (8,157 | ) | |||||
Net cash provided by operating
activities
|
6,204 | 7,707 | ||||||
Cash
Flows From Investing Activities:
|
||||||||
Purchases
of investment securities available-for-sale
|
(10,143 | ) | (59,029 | ) | ||||
Proceeds
from maturity and calls of investment securities
available-for-sale
|
18,558 | 43,288 | ||||||
Purchases
of investment securities held-to-maturity
|
(784,619 | ) | — | |||||
Proceeds
from the maturity and redemption of investment securities
held-to-maturity
|
31,615 | 17,991 | ||||||
Increase
in stock in Federal Home Loan Bank
|
(6,930 | ) | — | |||||
Purchase
of loans
|
— | (47,343 | ) | |||||
Proceeds
from sale of loans
|
53,797 | — | ||||||
Other
decreases (increases) in loans, net
|
135,642 | (74,853 | ) | |||||
Proceeds
from sale of other real estate owned
|
5,986 | — | ||||||
Cash
paid for capital expenditures
|
(1,702 | ) | (2,483 | ) | ||||
Proceeds
from sale of equipment
|
71 | — | ||||||
Net cash used in investing
activities
|
(557,725 | ) | (122,429 | ) | ||||
Cash
Flows From Financing Activities:
|
||||||||
Proceeds
and excess tax benefits from exercise of employee stock
options
|
71 | 2,462 | ||||||
Cash
paid to acquire treasury stock
|
(1,884 | ) | (7,124 | ) | ||||
Cash
paid for dividends
|
(828 | ) | (1,675 | ) | ||||
Increase
in deposit accounts
|
310,668 | 99,022 | ||||||
Repayments
from short-term borrowings
|
(2,600 | ) | (3,498 | ) | ||||
Proceeds
from long-term borrowings
|
414,000 | 100,000 | ||||||
Repayments
of long-term borrowings
|
(171,928 | ) | (68,240 | ) | ||||
Net cash provided by financing
activities
|
547,499 | 120,947 | ||||||
Net (decrease) increase in cash
and cash equivalents
|
(4,022 | ) | 6,225 | |||||
Cash and cash equivalents at
beginning of period
|
8,944 | 30,448 | ||||||
Cash and cash equivalents at
end of period
|
$ | 4,922 | $ | 36,673 | ||||
Supplemental
Cash Flow Information:
|
||||||||
Cash
paid during the period for interest
|
$ | 73,906 | $ | 80,597 | ||||
Cash
paid during the period for income taxes
|
$ | 194 | $ | 7,337 | ||||
Non-Cash
Investing and Financing Transactions:
|
||||||||
Loans
transferred to other real estate owned
|
$ | 9,070 | $ | 11,134 | ||||
Cash
dividends declared but not yet paid
|
$ | — | $ | 836 |
Weighted-Average
Assumptions for
Option Grants 2007
|
||
|
||
Dividend
Yield
|
1.18%
|
|
Expected
Volatility
|
23.83%
|
|
Risk-Free
Interest Rates
|
4.72%
|
|
Expected
Lives
|
Five
Years
|
|
Weighted-Average
Fair Value
|
$14.49
|
Net
Income
|
Weighted-
Average
Shares
Outstanding
|
Per
Share
Amount
|
||||||||||
(in
thousands, except per share data)
|
||||||||||||
For
the Three Months Ended June 30,
|
||||||||||||
2008
|
||||||||||||
Basic
EPS
|
$ | 2,350 | 5,429 | $ | 0.43 | |||||||
Effect
of dilutive stock options
|
— | 2 | (0.00 | ) | ||||||||
Diluted
EPS
|
$ | 2,350 | 5,431 | $ | 0.43 | |||||||
2007
|
||||||||||||
Basic
EPS
|
$ | 6,038 | 5,489 | $ | 1.10 | |||||||
Effect
of dilutive stock options
|
— | 124 | (0.02 | ) | ||||||||
Diluted
EPS
|
$ | 6,038 | 5,613 | $ | 1.08 | |||||||
For
the Six Months Ended June 30,
|
||||||||||||
2008
|
||||||||||||
Basic
EPS
|
$ | 3,047 | 5,427 | $ | 0.56 | |||||||
Effect
of dilutive stock options
|
— | 12 | (0.00 | ) | ||||||||
Diluted
EPS
|
$ | 3,047 | 5,439 | $ | 0.56 | |||||||
2007
|
||||||||||||
Basic
EPS
|
$ | 12,775 | 5,509 | $ | 2.32 | |||||||
Effect
of dilutive stock options
|
— | 139 | (0.06 | ) | ||||||||
Diluted
EPS
|
$ | 12,775 | 5,648 | $ | 2.26 |
Three
Months Ended
|
Six
Months Ended
|
|||||||||||||||
June
30,
|
June
30,
|
|||||||||||||||
2008
|
2007
|
2008
|
2007
|
|||||||||||||
(in
thousands)
|
||||||||||||||||
Net
Income
|
$ | 2,350 | $ | 6,038 | $ | 3,047 | $ | 12,775 | ||||||||
Other
comprehensive loss:
|
||||||||||||||||
Change
in net unrealized gains (loss) on investment securities
available-for-sale, net of tax benefit of $1,515 and $557 for the three
months ended June 30, 2008 and 2007, respectively, and $1,482 and $313 for
the six months ended June 30, 2008 and 2007, respectively.
|
(2,272 | ) | (835 | ) | (2,223 | ) | (469 | ) | ||||||||
Comprehensive
Income
|
$ | 78 | $ | 5,203 | $ | 824 | $ | 12,306 |
Assets
and Liabilities Measured at Fair Value on a Recurring Basis at June 30,
2008
|
||||||||||||||||
Quoted Prices in
Active
Markets
for
Identical
Assets
(Level 1)
|
Significant
Other
Observable
Inputs (Level 2)
|
Significant
Unobservable
Inputs (Level 3)
|
Balance
at
June
30, 2008
|
|||||||||||||
(dollars
in thousands)
|
||||||||||||||||
Assets
|
||||||||||||||||
Investment
securities — available-for-sale
|
$ | 117 | $ | 105,531 | $ | 786 | $ | 106,434 |
Changes
in Level 3 Assets and Liabilities Measured at Fair Value on a Recurring
Basis
|
|||||||||||||||||||||
Balance
at
December
31, 2007
|
Total Realized
and Unrealized
Gains
Included in
Income
|
Total
Realized and
Unrealized
Gains
|
Purchases,
Sales, Other
Settlements and
Issuances,
net
|
Net Transfers
In and/or Out
of
Level 3
|
Balance
at
June
30, 2008
|
||||||||||||||||
Net Revaluation
of
Retained Interests
|
|||||||||||||||||||||
(dollars
in thousands)
|
|||||||||||||||||||||
Assets
|
|||||||||||||||||||||
Investment
securities — available-for-sale
|
$ | 1,318 | $ — | $ | — | $ | (532 | ) | $ | — | $ | 786 |
Assets
and Liabilities Measured at Fair Value on a Non-Recurring Basis at
June
30, 2008
|
||||||||||||||||
Quoted Prices in
Active
Markets
for
Identical
Assets
(Level 1)
|
Significant
Other
Observable
Inputs (Level 2)
|
Significant
Unobservable
Inputs (Level 3)
|
Balance
at
June
30, 2008
|
|||||||||||||
(dollars
in thousands)
|
||||||||||||||||
Assets
|
||||||||||||||||
Impaired
Loans
|
$ | — | $ | — | $ | 113,232 | $ | 113,232 |
Lending
|
||||||||||||
Operations
|
All Other
|
Consolidated
|
||||||||||
(in
thousands)
|
||||||||||||
For
the three months ended June 30,
|
||||||||||||
2008
|
||||||||||||
Revenues
from external customers
|
$ | 62,192 | $ | 26 | $ | 62,218 | ||||||
Total
interest income
|
63,314 | 53 | 63,367 | |||||||||
Total
interest expense
|
36,796 | 1,798 | 38,594 | |||||||||
Net
income (loss)
|
4,022 | (1,672 | ) | 2,350 | ||||||||
2007
|
||||||||||||
Revenues
from external customers
|
$ | 63,260 | $ | 566 | $ | 63,826 | ||||||
Total
interest income
|
62,539 | 444 | 62,983 | |||||||||
Total
interest expense
|
39,078 | 2,088 | 41,166 | |||||||||
Net
income (loss)
|
7,480 | (1,442 | ) | 6,038 | ||||||||
For
the six months ended June 30,
|
||||||||||||
2008
|
||||||||||||
Revenues
from external customers
|
$ | 122,003 | $ | (433 | ) | $ | 121,570 | |||||
Total
interest income
|
122,340 | 111 | 122,451 | |||||||||
Total
interest expense
|
73,797 | 3,803 | 77,600 | |||||||||
Net
income (loss)
|
6,753 | (3,706 | ) | 3,047 | ||||||||
2007
|
||||||||||||
Revenues
from external customers
|
$ | 126,958 | $ | 916 | $ | 127,874 | ||||||
Total
interest income
|
125,606 | 709 | 126,315 | |||||||||
Total
interest expense
|
76,343 | 4,166 | 80,509 | |||||||||
Net
income (loss)
|
16,047 | (3,272 | ) | 12,775 |
For
the Three Months Ended June 30,
|
||||||||||||||||||||||||
2008
|
2007
|
|||||||||||||||||||||||
Average
Balance
|
Income/Expense
|
Yield/Rate
|
Average
Balance
|
Income/Expense
|
Yield/Rate
|
|||||||||||||||||||
(dollars
in thousands)
|
||||||||||||||||||||||||
Assets
|
||||||||||||||||||||||||
Cash
and investment securities
|
$ | 740,508 | $ | 13,446 | 7.30 | % | $ | 365,701 | $ | 4,519 | 4.96 | % | ||||||||||||
Loans
receivable
|
3,076,065 | 49,921 | 6.53 | % | 3,080,233 | 58,464 | 7.61 | % | ||||||||||||||||
Total
interest earning assets
|
3,816,573 | $ | 63,367 | 6.68 | % | 3,445,934 | $ | 62,983 | 7.33 | % | ||||||||||||||
Non-interest
earning assets
|
78,925 | 80,514 | ||||||||||||||||||||||
Allowance
for loan losses
|
(48,830 | ) | (46,218 | ) | ||||||||||||||||||||
Total
assets
|
$ | 3,846,668 | $ | 3,480,230 | ||||||||||||||||||||
Liabilities
and Shareholders’ Equity
|
||||||||||||||||||||||||
Interest
bearing deposit accounts:
|
||||||||||||||||||||||||
Interest
bearing demand
|
$ | 33,347 | $ | 255 | 3.08 | % | $ | 25,246 | $ | 246 | 3.91 | % | ||||||||||||
Money
market and passbook
|
273,732 | 2,431 | 3.57 | % | 230,458 | 2,871 | 5.00 | % | ||||||||||||||||
Time
certificates
|
1,982,484 | 21,616 | 4.39 | % | 1,843,336 | 24,368 | 5.30 | % | ||||||||||||||||
Total interest bearing deposit
accounts
|
2,289,563 | 24,302 | 4.27 | % | 2,099,040 | 27,485 | 5.25 | % | ||||||||||||||||
FHLB
advances and other borrowings
|
1,198,617 | 12,494 | 4.19 | % | 1,023,291 | 11,593 | 4.54 | % | ||||||||||||||||
Junior
subordinated debentures
|
86,600 | 1,798 | 8.35 | % | 86,600 | 2,088 | 9.67 | % | ||||||||||||||||
Total
interest bearing liabilities
|
3,574,780 | $ | 38,594 | 4.34 | % | 3,208,931 | $ | 41,166 | 5.15 | % | ||||||||||||||
Non-interest
bearing demand accounts
|
9,254 | 10,377 | ||||||||||||||||||||||
Other
non-interest bearing liabilities
|
35,380 | 34,727 | ||||||||||||||||||||||
Shareholders’
equity
|
227,254 | 226,195 | ||||||||||||||||||||||
Total liabilities and
shareholders’
equity
|
$ | 3,846,668 | $ | 3,480,230 | ||||||||||||||||||||
Net
interest spread (1)
|
2.34 | % | 2.18 | % | ||||||||||||||||||||
Net
interest income before provision for
loan losses
|
$ | 24,773 | $ | 21,817 | ||||||||||||||||||||
Net
interest margin (2)
|
2.61 | % | 2.54 | % | ||||||||||||||||||||
(1)
|
Average
yield on interest earning assets minus average rate paid on interest
bearing liabilities.
|
(2)
|
Net
interest income divided by total average interest earning
assets.
|
For
the Three Months Ended June
30, 2008 and 2007
|
||||||||||||
Increase
(Decrease) Due to:
|
||||||||||||
Rate
|
Volume
|
Total
|
||||||||||
(in
thousands)
|
||||||||||||
Interest
and fees earned from:
|
||||||||||||
Cash
and investment securities
|
$ | 2,814 | $ | 6,113 | $ | 8,927 | ||||||
Loans
|
(8,462 | ) | (81 | ) | (8,543 | ) | ||||||
Total
increase (decrease) in interest income
|
(5,648 | ) | 6,032 | 384 | ||||||||
Interest
paid on:
|
||||||||||||
Deposit
accounts
|
(5,488 | ) | 2,305 | (3,183 | ) | |||||||
FHLB
advances and other borrowings
|
(948 | ) | 1,849 | 901 | ||||||||
Junior
subordinated debentures
|
(290 | ) | — | (290 | ) | |||||||
Total
(decrease) increase in interest expense
|
(6,726 | ) | 4,154 | (2,572 | ) | |||||||
Increase
in net interest income
|
$ | 1,078 | $ | 1,878 | $ | 2,956 |
|
•
|
the
risk characteristics of various classifications of
loans;
|
|
•
|
general
portfolio trends relative to asset and portfolio
size;
|
|
•
|
asset
categories;
|
|
•
|
collateral
values;
|
|
•
|
potential
credit and geographic
concentrations;
|
|
•
|
delinquency
trends within the loan portfolio;
|
|
•
|
changes
in the volume and severity of past due loans, classified loans and other
loans of concern;
|
|
•
|
historical
loss experience and risks associated with changes in economic, social and
business conditions; and
|
|
•
|
the
underwriting standards in effect when the loan was
made.
|
For
the Six Months Ended June 30,
|
||||||||||||||||||||||||
2008
|
2007
|
|||||||||||||||||||||||
Average
Balance
|
Income/Expense
|
Yield/Rate
|
Average
Balance
|
Income/Expense
|
Yield/Rate
|
|||||||||||||||||||
(dollars
in thousands)
|
||||||||||||||||||||||||
Assets
|
||||||||||||||||||||||||
Cash
and investment securities
|
$ | 539,974 | $ | 17,695 | 6.59 | % | $ | 369,433 | $ | 9,088 | 4.96 | % | ||||||||||||
Loans
receivable
|
3,113,515 | 104,756 | 6.77 | % | 3,042,421 | 117,227 | 7.77 | % | ||||||||||||||||
Total
interest earning assets
|
3,653,489 | $ | 122,451 | 6.74 | % | 3,411,854 | $ | 126,315 | 7.47 | % | ||||||||||||||
Non-interest
earning assets
|
81,173 | 77,969 | ||||||||||||||||||||||
Allowance
for loan losses
|
(48,133 | ) | (46,396 | ) | ||||||||||||||||||||
Total
assets
|
$ | 3,686,529 | $ | 3,443,427 | ||||||||||||||||||||
Liabilities
and Shareholders’ Equity
|
||||||||||||||||||||||||
Interest
bearing deposit accounts:
|
||||||||||||||||||||||||
Interest
bearing demand
|
$ | 30,649 | $ | 490 | 3.22 | % | $ | 24,825 | $ | 434 | 3.53 | % | ||||||||||||
Money
market and passbook
|
261,029 | 4,890 | 3.77 | % | 226,647 | 5,589 | 4.97 | % | ||||||||||||||||
Time
certificates
|
1,892,616 | 44,005 | 4.68 | % | 1,832,487 | 48,050 | 5.29 | % | ||||||||||||||||
Total interest bearing deposit
accounts
|
2,184,294 | 49,385 | 4.55 | % | 2,083,959 | 54,073 | 5.23 | % | ||||||||||||||||
FHLB
advances and other borrowings
|
1,141,113 | 24,412 | 4.30 | % | 1,000,576 | 22,270 | 4.49 | % | ||||||||||||||||
Junior
subordinated debentures
|
86,600 | 3,803 | 8.83 | % | 86,600 | 4,166 | 9.70 | % | ||||||||||||||||
Total
interest bearing liabilities
|
3,412,007 | $ | 77,600 | 4.57 | % | 3,171,135 | $ | 80,509 | 5.12 | % | ||||||||||||||
Non-interest
bearing demand accounts
|
9,497 | 11,007 | ||||||||||||||||||||||
Other
non-interest bearing liabilities
|
36,818 | 36,132 | ||||||||||||||||||||||
Shareholders’
equity
|
228,207 | 225,153 | ||||||||||||||||||||||
Total liabilities and
shareholders’
equity
|
$ | 3,686,529 | $ | 3,443,427 | ||||||||||||||||||||
Net
interest spread (1)
|
2.17 | % | 2.35 | % | ||||||||||||||||||||
Net
interest income before provision for
loan losses
|
$ | 44,851 | $ | 45,806 | ||||||||||||||||||||
Net
interest margin (2)
|
2.47 | % | 2.71 | % | ||||||||||||||||||||
(1)
|
Average
yield on interest earning assets minus average rate paid on interest
bearing liabilities.
|
(2)
|
Net
interest income divided by total average interest earning
assets.
|
For
the Six Months Ended June
30, 2008 and 2007
|
||||||||||||
Increase
(Decrease) Due to:
|
||||||||||||
Rate
|
Volume
|
Total
|
||||||||||
(in
thousands)
|
||||||||||||
Interest
and fees earned from:
|
||||||||||||
Cash
and investment securities
|
$ | 3,579 | $ | 5,028 | $ | 8,607 | ||||||
Loans
|
(15,204 | ) | 2,733 | (12,471 | ) | |||||||
Total
(decrease) increase in interest income
|
(11,625 | ) | 7,761 | (3,864 | ) | |||||||
Interest
paid on:
|
||||||||||||
Deposit
accounts
|
(7,229 | ) | 2,541 | (4,688 | ) | |||||||
FHLB
advances and other borrowings
|
(957 | ) | 3,099 | 2,142 | ||||||||
Junior
subordinated debentures
|
(363 | ) | — | (363 | ) | |||||||
Total
(decrease) increase in interest expense
|
(8,549 | ) | 5,640 | (2,909 | ) | |||||||
(Decrease)
increase in net interest income
|
$ | (3,076 | ) | $ | 2,121 | $ | (955 | ) |
June
30,
2008
|
December
31,
2007
|
|||||||
(dollars
in thousands)
|
||||||||
Nonaccrual
loans:
|
||||||||
Real
estate
|
$ | 38,092 | $ | 29,145 | ||||
Construction
and land
|
78,655 | 8,804 | ||||||
Entertainment
finance
|
12 | 13 | ||||||
Total
nonaccrual loans
|
116,759 | 37,962 | ||||||
Other
real estate and other assets owned, net
|
20,912 | 19,396 | ||||||
Total
non-performing assets
|
137,671 | 57,358 | ||||||
Performing
troubled debt restructurings
|
8,077 | 7,802 | ||||||
Total
non-performing assets and performing troubled debt
restructurings
|
$ | 145,748 | $ | 65,160 | ||||
Nonaccrual
loans to total loans
|
3.94 | % | 1.20 | % | ||||
Allowance
for loan losses to nonaccrual loans
|
43.82 | % | 125.87 | % | ||||
Non-performing
assets to total assets
|
3.36 | % | 1.62 | % |
For
the Six
Months
Ended
June
30,
2008
|
For
the Year
Ended
December
31,
2007
|
For
the Six
Months
Ended
June
30,
2007
|
||||||||||
(dollars
in thousands)
|
||||||||||||
Balance
at beginning of period
|
$ | 47,783 | $ | 46,049 | $ | 46,049 | ||||||
Provision
for loan losses
|
10,500 | 11,077 | 1,250 | |||||||||
Charge-offs
|
(7,737 | ) | (10,873 | ) | (4,848 | ) | ||||||
Recoveries
|
613 | 1,530 | 549 | |||||||||
Net
charge-offs
|
(7,124 | ) | (9,343 | ) | (4,299 | ) | ||||||
Balance
at end of period
|
$ | 51,159 | $ | 47,783 | $ | 43,000 | ||||||
Allowance
for loan losses as a percentage of
loans, net
|
1.73 | % | 1.51 | % | 1.38 | % |
·
|
Changes
in economic conditions, particularly a further economic slowdown in
California, could hurt our
business.
|
·
|
loan
delinquencies may increase;
|
·
|
problem
assets and foreclosures may
increase;
|
·
|
demand
for our products and services may decline;
and
|
·
|
collateral
for our loans may decline in value, in turn reducing a customer’s
borrowing power and reducing the value of assets and collateral securing
our loans.
|
·
|
Recent
negative developments in the financial industry and credit markets may
continue to adversely impact our financial condition and results of
operations.
|
·
|
We
may elect or be compelled to seek additional capital in the future, but
that capital may not be available when it is
needed.
|
Period
|
Total
Number of Shares Purchased(1)
|
Average
Price Paid per Share
|
Total
Number of Shares Purchased as Part of Publicly Announced Plans or
Programs
|
Maximum
Number of Shares that May Yet Be Purchased Under the Plans or
Programs(2)
|
||||||||||||
April
1, 2008 to April
30, 2008
|
2,922 | $ | 17.68 | — | 110,486 | |||||||||||
May
1, 2008 to May
31, 2008
|
58,986 | 10.57 | — | 110,486 | ||||||||||||
June
1, 2008 to June
30, 2008
|
9,100 | 10.43 | — | 110,486 | ||||||||||||
Total
|
71,008 | $ | 10.84 | — | 110,486 |
|
(1)
Shares purchased during the quarter ended June 30, 2008, represent open
market purchases by the Company’s rabbi trust in connection with our
Supplemental Executive Retirement Plan and our Nonqualified Deferred
Compensation Plan.
|
|
(2)
There were no repurchases under the twelfth extension of our stock
repurchase program during the three months ended June 30,
2008. The twelfth extension was announced on March 14, 2006,
and authorized the repurchase of an additional 5% of the outstanding
shares as of the authorization date. At June 30, 2008, a total
of 110,486 shares remained available for repurchase under this
extension.
|
IMPERIAL
CAPITAL BANCORP, INC.
|
||
Date:
July 30,
2008
|
/s/ George W. Haligowski
|
|
George
W. Haligowski
|
||
Chairman
of the Board, President and
|
||
Chief
Executive Officer
|
Date:
July 30,
2008
|
/s/ Timothy M. Doyle
|
|
Timothy
M. Doyle
|
||
Executive
Managing Director and
|
||
Chief
Financial Officer
|
Regulation
S-K Exhibit Number
|
Document
|
Reference
to Prior Filling or Exhibit Number Attached Hereto
|
||
3.1
|
Certificate
of Incorporation
|
************
|
||
3.2
|
Bylaws,
as amended
|
***
|
||
4
|
Instruments
Defining the Rights of Security Holders, Including
Indentures
|
**********
|
||
10.1
|
2005
Re-Designated, Amended and Restated Stock Option Plan For Nonemployee
Directors (“NEDP”)
|
*****
|
||
10.2
|
2005
Re-Designated, Amended and Restated Employee Stock Incentive Plan
(“ESIP”)
|
********
|
||
10.3a
|
409A
Consolidated Nonqualified (Employer Securities Only) 2005 Deferred
Compensation Plan
|
***
|
||
10.3b
|
409A
Consolidated Nonqualified (Non-Employer Securities) 2005 Deferred
Compensation Plan
|
***
|
||
10.3c
|
Consolidated
Nonqualified (Employer Securities Only) Deferred Compensation
Plan
|
***
|
||
10.3d
|
Consolidated
Nonqualified (Non-Employer Securities) Deferred Compensation
Plan
|
***
|
||
10.4
|
Supplemental
Salary Savings Plan
|
*
|
||
10.5a
|
Amended
and Restated Employment Agreement with George W.
Haligowski
|
********
|
||
10.5b
|
Non-Competition
and Non-Solicitation Agreement with George W. Haligowski
|
********
|
||
10.6
10.7
10.8
10.9
|
Change
in Control Severance Agreement with Norval L. Bruce
Change
in Control Severance Agreement with Timothy M. Doyle
Change
in Control Severance Agreement with Lyle C. Lodwick
Change
in Control Severance Agreement with Phillip E. Lombardi
|
********
********
********
***********
|
||
10.10
|
Recognition
and Retention Plan
|
**
|
||
10.11
|
Voluntary
Retainer Stock and Deferred Compensation Plan for Outside
Directors
|
****
|
||
10.12
|
Amended
and Restated Supplemental Executive Retirement Plan
|
********
|
||
10.13
|
Amended
and Restated ITLA Capital Corporation Rabbi Trust
Agreement
|
*********
|
||
10.14
|
Amended
and Restated Salary Continuation Plan
|
********
|
||
10.15
|
Form
of Incentive Stock Option Agreement under ESIP
|
******
|
||
10.16
10.17
|
Form
of Non-Qualified Stock Option Agreement under the ESIP
Form
of Non-Qualified Stock Option Agreement under the NEDP
|
******
*******
|
||
10.18
|
Description
of Named Executive Officer Salary, Bonus and Perquisite
Arrangements for 2008
|
*************
|
||
10.19
|
Description
of Director Fee Arrangements
|
*************
|
||
10.20
|
Split
Dollar Agreement
|
*************
|
||
11
|
Statement
Regarding Computation of Per Share Earnings
|
Not
Required
|
||
13
|
Annual
Report to Security Holders
|
None
|
||
18
|
Letter
Regarding Change in Accounting Principles
|
None
|
||
21
|
Subsidiaries
of the Registrant
|
Not
Required
|
||
22
|
Published
Report Regarding Matters Submitted to Vote of Security
Holders
|
None
|
||
23.1
|
Consent
of Ernst & Young LLP
|
Not
Required
|
||
24
|
Power
of Attorney
|
None
|
||
31.1
|
Rule
13a-14(a)/15d-14(a) Certification of Chief Executive
Officer
|
31.1
|
||
31.2
|
Rule
13a-14(a)/15d-14(a) Certification of Chief Financial
Officer
|
31.2
|
||
32
|
Section
1350 Certifications of Chief Executive Officer and Chief Financial
Officer
|
32
|
*
|
Filed
as an exhibit to Imperial’s Registration Statement on Form S-1 (File No.
33-96518) filed with the Commission on September 1, 1995, pursuant to
Section 5 of the Securities Act of 1933.
|
*
*
|
Filed
as an exhibit to the Company’s Registration Statement on Form S-4 (File
No. 333-03551) filed with the Commission on May 10, 1996, pursuant to
Section 5 of the Securities Act of 1933.
|
* *
*
|
Filed
as an exhibit to the Company’s Current Report on Form 8-K filed on
December 7, 2007.
|
* *
* *
|
Filed
as an exhibit to Amendment No. Two to the Company’s Registration Statement
on Form S-4 (File No. 333-03551) filed with the Commission on June 19,
1996.
|
* *
* * *
|
Filed
as an appendix to the Company’s definitive proxy materials filed on June
27, 2005.
|
* *
* * * *
|
Filed
as an exhibit to the Company’s Current Report on Form 8-K filed on August
9, 2005.
|
* *
* * * * *
|
Filed
as an exhibit to the Company’s Current Report on Form 8-K filed on
November 4, 2005.
|
* *
* * * * * *
|
Filed
as an exhibit to the Company’s Current Report on Form 8-K filed on
February 24, 2006.
|
* *
* * * * * * *
|
Filed
as an exhibit to the Company’s Form 10-Q for the quarter ended June 30,
2006.
|
* *
* * * * * * * *
|
The
Company hereby agrees to furnish the SEC, upon request, copies of the
instruments defining the rights of the holders of each issue of the
Company's long-term debt.
|
* *
* * * * * * * * *
|
Filed
as an exhibit to the Company’s Form 10-K for the year ended December 31,
2006.
|
* *
* * * * * * * * * *
|
Filed
as an exhibit to the Company’s Form 10-Q for the quarter ended June 30,
2007 (File No. 01-33199).
|
* *
* * * * * * * * * * *
|
Filed
as an exhibit to the Company’s Form 10-K for the year ended December 31,
2007.
|