Signature Bank (SBNY) Tops Q2 EPS by 3c

Signature Bank (NASDAQ: SBNY) reported Q2 EPS of $2.83, $0.03 better than the analyst estimate of $2.80.

• Bank Announces Inaugural Quarterly Dividend of $0.56 Per Share
• Net Income for the 2018 Second Quarter Was $154.6 Million, or $2.83 Diluted Earnings Per Share Versus $14.0 Million, or $0.26 Diluted Earnings Per Share, Reported in the 2017 Second Quarter. Excluding Provision Expense and Write-Downs for the Taxi Medallion Portfolio, 2017 Second Quarter Net Income Would Have Been $120.2 Million, or $2.21 Diluted Earnings Per Share
• The Bank Declared a Cash Dividend of $0.56 Per Share, Payable on or After August 15, 2018 to Common Shareholders of Record at the Close of Business on August 1, 2018
• Total Deposits in the Second Quarter Grew $176.0 Million to $34.99 Billion, Affected By a Decrease of $918.2 Million in Escrow Deposits; Total Deposits Have Grown $1.83 Billion, or 5.5 Percent, Since the End of the 2017 Second Quarter. Average Deposits Increased $237.0 Million in the 2018 Second Quarter
• For the 2018 Second Quarter, Loans Increased $900.3 Million, or 2.7 Percent, to $34.15 Billion. Since the End of the 2017 Second Quarter, Loans Have Increased 12.4 Percent, or $3.76 Billion
• Non-Accrual Loans were $158.1 Million, or 0.46 Percent of Total Loans, at June 30, 2018, Versus $168.7 Million, or 0.51 Percent, at the End of the 2018 First Quarter and $392.9 Million, or 1.29 Percent, at the End of the 2017 Second Quarter. Excluding Taxi Medallion Loans, Which Were All Placed on Non-Accrual in the 2017 Second Quarter, Non-Accrual Loans Were $23.4 Million, or Seven Basis Points of Total Loans
• Net Interest Margin on a Tax-Equivalent Basis Was 2.94 Percent, Compared with 3.01 Percent for the 2018 First Quarter and 3.11 Percent for the 2017 Second Quarter. Core Net Interest Margin on a Tax-Equivalent Basis Excluding Loan Prepayment Penalty Income Declined Six Basis Points to 2.89 Percent for the 2018 Second Quarter when Compared with the 2018 First Quarter
• Tier 1 Leverage, Common Equity Tier 1 Risk-Based, Tier 1 Risk-Based and Total Risk-Based Capital Ratios were 9.64 Percent, 12.10 Percent, 12.10 Percent and 13.42 Percent, Respectively, at June 30, 2018. Signature Bank Remains Significantly Above FDIC “Well Capitalized” Standards. Tangible Common Equity Ratio Was 9.10 Percent
• Two Private Client Banking Teams Joined During the 2018 Second Quarter Bringing the Total Team Hires to Four in 2018. Another Two Teams Have Joined Thus Far in the Third Quarter of 2018

“Signature Bank’s solid earnings and growth this quarter, coupled with both the positive impact of the $50 billion SIFI mark moving higher and tax reform has enabled us to declare an inaugural quarterly cash dividend of $0.56 per share to our common shareholders, representing an annualized dividend of $2.24 per share. We are proud of our colleagues who work hard for our clients every day, and we believe those efforts show through in our results and in returns for our shareholders,” explained Joseph J. DePaolo, President and Chief Executive Officer.

“Additionally, Signature Bank continues to make the necessary investments to further our progress. Recent initiatives indicative of the Bank’s plan for sustained growth include the hiring of private client banking teams in both New York and San Francisco, where we are now building a strong Signature Bank presence. We are strengthening our infrastructure with a new loan system soon to be in place. We are investing in a new credit approval system, foreign exchange system and an enhanced payments platform, to which we previously alluded. All these efforts are augmenting Signature Bank’s solid foundation and will allow us to further our growth initiatives,” DePaolo said.

“The recent passing of the Economic Growth, Regulatory Relief and Consumer Protection Act by Congress bodes well for banks like ours. Raising the SIFI designation threshold from $50 billion to $250 billion will foster greater competition by affording banks of varying size more opportunity within the banking industry,” said Scott A. Shay, Chairman of the Board.

“In turn, this will prove beneficial for small and medium-sized businesses as they stand to gain better access to capital. Now, nimble, medium-sized banks such as Signature Bank will be better positioned to more effectively compete with the too-big-to-fail megabanks, and the commercial banking landscape will offer better options to growing companies thereby further stimulating economic growth,” Shay concluded.

For earnings history and earnings-related data on Signature Bank (SBNY) click here.

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