 |  |  |  |  |  |  |  |  |
|
Bay View Capital Corporation Announces Third Quarter Results
SAN MATEO, Calif., Nov. 7 /PRNewswire-FirstCall/ -- Bay View Capital Corporation (the "Company") today reported a third quarter 2005 net loss of $1.4 million, or $0.21 per diluted share, compared to a second quarter 2005 net loss of $1.5 million, or $0.23 per diluted share, and a third quarter 2004 net loss of $1.6 million, or $0.25 per diluted share. Net loss for the nine months ended September 30, 2005 was $3.2 million, or $0.49 per diluted share, compared to $2.7 million, or $0.41 per diluted share, for the nine months ended September 30, 2004. Third Quarter Results of Operations Record quarterly loan production by Bay View Acceptance Corporation ("BVAC"), the Company's auto finance subsidiary, increased net interest income and decreased provision for credit losses highlighted the third quarter results. However, net leasing income declined with the continued runoff of the Company's liquidating auto lease portfolio, and noninterest expense increased due primarily to activities associated with the Company's other liquidating assets. Interest rates continued to rise in the third quarter of 2005, producing an unrealized gain of $0.7 million in the Company's interest rate derivatives for the quarter. The Company's net interest income increased to $5.0 million for the third quarter of 2005 from $4.0 million for the second quarter of 2005 and $3.8 million for the third quarter of 2004, primarily on growth in auto contracts receivable during the first nine months of 2005. However, the Company's net interest margin declined as floating-rate funding costs on BVAC's warehouse credit facility rose more rapidly than yields on warehoused auto contracts. The Company recorded a provision for credit losses of $1.3 million for the third quarter of 2005 compared to $1.8 million for the second quarter of 2005 and $0.3 million for the third quarter of 2004. During the third quarter of 2005, auto contracts held-for-investment decreased by $43.5 million while auto contracts held-for-sale increased by $133.3 million. The Company's noninterest income was $1.8 million for the third quarter of 2005 compared to $1.1 million for the second quarter of 2005 and $1.2 million for the third quarter of 2004. The increase in noninterest income was largely due to the aforementioned gain on derivative instruments, partially offset by reduced leasing income as that portfolio continued to run off. During the third quarter of 2005, the Company recorded $0.7 million of unrealized gain on its interest rate derivatives, designated as fair value hedges, compared to $1.1 million of unrealized loss in the second quarter of 2005 and $1.8 million of unrealized loss in the third quarter of 2004. Leasing income declined by $1.9 million compared to the third quarter of 2004. The Company's noninterest expense was $7.7 million for the third quarter of 2005 compared to $5.8 million for the second quarter of 2005 and $7.3 million for the third quarter of 2004. The linked-quarter increase was primarily due to additional accrued liquidation expense, higher professional and legal fees and a $0.5 million writedown on the Company's liquidating real estate owned portfolio. The writedown and subsequent sale of this property during the third quarter of 2005 reduced nonperforming assets in the liquidating portfolio to $0.7 million at September 30, 2005 from $2.7 million at June 30, 2005. Financial Condition Auto contracts receivable increased by $263.3 million, or 80%, in the nine months ended September 30, 2005. Total assets increased to $693.9 million at September 30, 2005 from $423.3 million at December 31, 2004. At September 30, 2005, borrowings included $229.4 million of outstandings on BVAC's warehouse credit facility and $345.7 million of securitization notes payable. During the first nine months of 2005, the Company liquidated an additional $9.7 million of its remaining auto lease portfolio, reducing the balance at September 30, 2005 to $0.3 million. At September 30, 2005, the Company had $20.4 million of current and deferred tax assets, net, consisting of current and deferred tax assets of $41.9 million less a valuation allowance of $21.5 million. Bay View Acceptance Corporation BVAC produced third quarter 2005 net income of $1.0 million compared to a second quarter 2005 net loss of $864 thousand and a third quarter 2004 net loss of $548 thousand. Net interest income rose by 23% on a linked-quarter basis and 32% on a year-over-year basis -- to $4.8 million for the third quarter of 2005 from $3.9 million for the second quarter of 2005 and $3.6 million for the third quarter of 2004 -- on $263.3 million of growth in auto contracts receivable during the first nine months of 2005. Net interest margin declined by 6 basis points on a linked-quarter basis and 163 basis points year-over-year. Net interest margin averaged 3.21% for the third quarter of 2005 compared to 3.27% for the second quarter of 2005 and 4.84% for the third quarter of 2004 as floating-rate funding costs on BVAC's warehouse credit facility rose more rapidly than yields on warehoused auto contracts. As previously noted, third quarter 2005 results included a $0.7 million unrealized gain on interest rate derivatives and a lower provision for credit losses. Third quarter 2005 purchases of auto contracts rose to $147.5 million from second quarter 2005 purchases of $144.8 million and third quarter 2004 purchases of $69.5 million due largely to the success of BVAC's efforts to broaden its market for good credit quality customers. For the third quarter of 2005, BVAC's purchased contract rate averaged 9.04% compared to 8.88% for the second quarter of 2005 and 8.06% for the third quarter of 2004 -- an increase of 16 basis points quarter-over-quarter and 99 basis points year-over-year. FICO credit scores averaged 734 for both second quarter and third quarter 2005 production compared with 742 for third quarter 2004 production. Net chargeoffs improved to an annualized rate of 0.85% of managed contracts in the third quarter of 2005 from 0.92% in the second quarter of 2005 and 1.01% in the third quarter of 2004. At September 30, 2005, BVAC was servicing approximately 37,000 auto contracts with an aggregate outstanding balance of $744 million compared to approximately 28,000 auto contracts with an aggregate outstanding balance of $557 million at September 30, 2004. In July 2005, BVAC issued $180.9 million of auto receivable-backed notes through Bay View 2005-LJ-2 Owner Trust. The issue, BVAC's first senior/ subordinate structure, was comprised of four AAA-rated fixed-rate senior note classes and three subordinate classes rated down to BBB. Principal is paid sequentially to the notes. In this transaction, credit support to all classes is provided by excess spread, a reserve account and subordination in the form of an unrated certificate. The notes have final maturities ranging between July 28, 2006 and February 25, 2014 and contain a provision that grants BVAC the option of calling the notes at any time after the aggregate balance of the receivables has been reduced to 15% of the original pool of receivables. Proceeds from the issuance of the notes were used to repay $180.0 million of borrowings on BVAC's revolving warehouse credit facility. BVAC has evaluated its exposure to losses in the areas affected by Hurricane Katrina and Hurricane Rita, including a review of outstanding auto contract balances for borrowers in Alabama, Louisiana, Mississippi and certain areas of Texas, delinquencies of borrowers in these areas, strategies for tracking borrowers that may have left these areas to reside elsewhere, and vehicle losses related to flood damage. The Company believes it has no material exposure to losses from Hurricane Katrina and Hurricane Rita. Other Today the Company also filed a Form 8-K Current Report with the Securities and Exchange Commission ("SEC") announcing that it had signed a definitive agreement whereby a subsidiary of AmeriCredit Corp. (NYSE:ACF) will purchase all of the outstanding capital stock of BVAC in an all-cash transaction for approximately $62.5 million, the approximate book value of BVAC as of June 30, 2005. The sale of BVAC to AmeriCredit is expected to close during the first half of 2006, subject to approval of the sale by the Company's stockholders and customary government approvals. AmeriCredit is a leading independent auto finance company that operates throughout the United States. On October 28, 2005, the Company filed a Form 8-K Current Report with the SEC announcing the execution of a definitive agreement to merge with Great Lakes Bancorp, Inc. ("Great Lakes") of Buffalo, New York, with the Company as the surviving corporation. Great Lakes is the holding company for Greater Buffalo Savings Bank (the "Bank") which was founded in November 1999 and as of September 30, 2005 reported assets of $771 million. The Bank operates 9 full service branches and currently has 4 additional branches under construction in Western New York. Under the terms of the merger agreement, Great Lakes stockholders will receive a fixed ratio of 1.0873 shares of Bay View common stock for each share of Great Lakes common stock. Based on the closing price of Bay View common stock on October 25, 2005, the transaction is valued at approximately $67.1 million. After completion of the merger, Bay View stockholders will own approximately 60% of Bay View's then outstanding shares. The merger is expected to close in the first quarter of 2006, subject to receipt of government regulatory approvals and stockholder approvals. The merged businesses will operate under the name of Great Lakes Bancorp, but will maintain Bay View's listing on the NYSE. Three members of Bay View's senior executive team will be joining the Board of Directors of Great Lakes, which will have 15 members upon the merger. Following the merger, Robert B. Goldstein will serve as Chairman of the Executive Committee of the Great Lakes Board, Charles G. Cooper will become Chairman of the ALCO and Risk Management Committee of the Great Lakes Board and John W. Rose will become Chairman of the Investor Relations Committee of the Great Lakes Board. They will join Barry Snyder, who will continue as Chairman of the Board of Great Lakes, and Andrew W. Dorn, Jr., who will continue as President and Chief Executive Officer of Great Lakes. The Company does not expect the merger to adversely impact its net operating loss carryforwards. Conference Call The Company will host a conference call at 2:00 p.m. PST on Wednesday November 9, 2005 to discuss its financial results. Analysts, media representatives and the public are invited to listen to this discussion by calling 1-888-793-6954 and referencing the password "BVC." An audio replay of this conference call will be available through Friday, December 9, 2005 and can be accessed by dialing 1-866-486-4643. Bay View Capital Corporation is a financial services company headquartered in San Mateo, California. Its common stock is listed on the NYSE: BVC. For more information, visit the Company's website at http://www.bayviewcapital.com/. Forward-Looking Statements All statements contained in this release that are not historic facts are based on current expectations. Such statements are forward-looking statements (as defined in the Private Securities Litigation Reform Act of 1995) in nature and involve a number of risks and uncertainties. Although the Company currently believes that the assumptions underlying the forward-looking statements are reasonable, any of the assumptions could prove inaccurate and, therefore, there can be no assurance that the results contemplated by the forward-looking statements will be realized. For information regarding factors that could cause the results contemplated by the forward-looking statements to differ from expectations, such as the inability to achieve any financial goals related to contemplated asset resolution, including the inability to use net operating loss carryforwards that the Company currently has, please refer to the Company's Reports on Forms 10-K and 10-Q filed with the SEC. In light of the significant uncertainties inherent in the forward- looking statements included herein, the inclusion of such statements should not be regarded as a representation by the Company or any other person. The Company disclaims any obligation to update such forward-looking statements or to announce publicly the results of any revisions to any of the forward- looking statements included herein to reflect future events or developments. Bay View Capital Corporation
Consolidated Statements of Financial Condition
September 30, December 31,
2005 2004
(Unaudited)
(Dollars in thousands)
ASSETS
Cash $10,531 $4,447
Restricted cash 38,287 26,845
Retained interests in securitizations
available-for-sale 20,564 22,636
Auto installment contracts and loans
held-for-sale:
Auto installment contracts 234,824 75,021
Other loans -- 902
Auto installment contracts held-for-investment,
net 6,975 252,863
Securitized auto installment contracts
held-for-investment, net 349,417 --
Investment in operating lease assets, net 344 10,041
Real estate owned, net 722 3,379
Premises and equipment, net 638 733
Repossessed vehicles 407 439
Current and deferred income taxes, net 20,436 16,977
Goodwill 1,846 1,846
Other assets 8,863 7,199
Total assets $693,854 $423,328
LIABILITIES AND STOCKHOLDERS' EQUITY
Borrowings:
Warehouse credit facility and other
short-term borrowings $229,446 $298,755
Securitization notes payable 345,723 --
Other borrowings 1 1,895
Other liabilities 9,675 9,629
Liquidation reserve 7,708 8,856
Total liabilities 592,553 319,135
Stockholders' equity:
Common stock ($.01 par value); authorized,
80,000,000 shares; issued, 2005 -
6,597,848 shares; 2004 - 6,597,303 shares;
outstanding, 2005 - 6,596,431 shares; 2004 -
6,593,860 shares 66 66
Additional paid-in capital 109,254 109,578
Accumulated deficit (7,829) (4,585)
Treasury stock, at cost; 2005 - 1,417
shares; 2004 - 3,443 shares (252) (587)
Accumulated other comprehensive income (loss) 62 (279)
Total stockholders' equity 101,301 104,193
Total liabilities and stockholders' equity $693,854 $423,328
Bay View Capital Corporation
Consolidated Statements of Operations and Comprehensive Loss
(Unaudited)
For the Three Months Ended
September 30, June 30, September 30,
2005 2005 2004
(In thousands, except per share amounts)
Interest income:
Interest on auto installment
contracts and other loans $10,305 $8,276 $5,217
Interest on short-term
investments and retained
interests in securitizations 980 844 743
11,285 9,120 5,960
Interest expense:
Interest on warehouse credit
facility and other short-term
borrowings 2,553 2,661 2,130
Interest on securitization
notes payable 3,775 2,440 --
Other interest expense -- 5 17
6,328 5,106 2,147
Net interest income 4,957 4,014 3,813
Provision for credit losses 1,257 1,793 331
Net interest income after
provision for credit losses 3,700 2,221 3,482
Noninterest income:
Leasing income 631 1,843 2,510
Loan servicing income 408 472 720
Loan fees 254 193 239
Unrealized gain (loss) on
derivative instruments 738 (1,106) (1,757)
Loss on auto installment
contracts and other loans
held-for-sale and retained
interests in securitizations,
net (280) (585) (616)
Other, net 56 279 68
1,807 1,096 1,164
Noninterest expense:
General and administrative 7,067 5,630 6,009
Leasing expense 60 156 1,190
Real estate owned, net 545 24 109
7,672 5,810 7,308
Loss before income tax benefit (2,165) (2,493) (2,662)
Income tax benefit (801) (947) (1,044)
Net loss $(1,364) $(1,546) $(1,618)
Basic loss per share $(0.21) $(0.23) $(0.25)
Diluted loss per share $(0.21) $(0.23) $(0.25)
Weighted-average basic
shares outstanding 6,596 6,596 6,588
Weighted-average diluted
shares outstanding 6,596 6,596 6,588
Net loss $(1,364) $(1,546) $(1,618)
Other comprehensive income
(loss), net of tax:
Change in unrealized gain
(loss) on securities
available-for-sale, net
of tax expense (benefit)
of $66, $77 and ($254)
for the three month periods
ended September 30, 2005,
June 30, 2005 and
September 30, 2004,
respectively 103 120 (398)
Comprehensive loss $(1,261) $(1,426) $(2,016)
Bay View Capital Corporation
Consolidated Statements of Operations and Comprehensive Loss
(Unaudited)
For the Nine Months Ended
September 30, September 30,
2005 2004
(In thousands, except per
share amounts)
Interest income:
Interest on auto installment contracts
and other loans $24,931 $13,880
Interest on short-term investments and
retained interests in securitizations 2,545 2,204
27,476 16,084
Interest expense:
Interest on warehouse credit facility and
other short-term borrowings 7,624 4,906
Interest on securitization notes payable 7,475 --
Other interest expense 13 1,346
15,112 6,252
Net interest income 12,364 9,832
Provision for credit losses 3,887 852
Net interest income after provision
for credit losses 8,477 8,980
Noninterest income:
Leasing income 4,544 11,334
Loan servicing income 1,432 2,519
Loan fees 630 963
Unrealized gain on derivative instruments 1,112 651
Loss on auto installment contracts and other
loans held-for-sale and retained interests
in securitizations, net (1,314) (2,261)
Other, net 577 1,168
6,981 14,374
Noninterest expense:
General and administrative 19,303 18,696
Leasing expense 731 8,705
Real estate owned, net 573 389
20,607 27,790
Loss before income tax benefit (5,149) (4,436)
Income tax benefit (1,905) (1,740)
Net loss $(3,244) $(2,696)
Basic loss per share $(0.49) $(0.41)
Diluted loss per share $(0.49) $(0.41)
Weighted-average basic shares outstanding 6,595 6,583
Weighted-average diluted shares outstanding 6,595 6,583
Net loss $(3,244) $(2,696)
Other comprehensive income, net of tax:
Change in unrealized gain on securities
available-for-sale, net of tax expense
of $220 and $110 for the nine month
periods ended September 30, 2005 and
September 30, 2004, respectively 341 172
Comprehensive loss $(2,903) $(2,524)
BAY VIEW CAPITAL CORPORATION
SELECTED FINANCIAL DATA
(Unaudited)
At At At
September 30, December 31, September 30,
2005 2004 2004
(Dollars in thousands except per share amounts)
Auto Installment Contracts
and Other Loans Receivable:
Auto installment contracts
Auto installment contracts
held-for-sale $234,824 $75,021 $129,371
Auto installment contracts
held-for-investment, net 6,975 252,863 147,703
Securitized auto
installment contracts
held-for-investment, net 349,417 -- --
Total auto installment
contracts, net 591,216 327,884 277,074
Other loans held-for-sale -- 902 925
Auto installment contracts
and other loans
receivable, net (1) $591,216 $328,786 $277,999
Credit Quality
(Liquidating Portfolio):
Nonperforming assets -
total (2) (3) $722 $4,282 $5,104
Nonperforming assets -
franchise $552 $3,792 $4,602
Loans delinquent 60 days
or more $-- $902 $925
Loans delinquent 60 days
or more - franchise $-- $583 $593
Per Share Data:
Book value per share $15.36 $15.80 $18.35
Other Data:
Full-time equivalent
employees, including BVAC 105 125 128
(1) Includes allowances for mark-to-market valuation reserves and credit
losses of $3.7 million, $2.7 million and $2.0 million at
September 30, 2005, December 31, 2004 and September 30, 2004,
respectively.
(2) Consists entirely of real estate owned at September 30, 2005.
(3) Nonperforming assets include mark-to-market valuation reserves of
$1.2 million at both December 31, 2004 and September 30, 2004,
respectively.
BAY VIEW ACCEPTANCE CORPORATION
(Unaudited)
At At At
September 30, December 31, September 30,
2005 2004 2004
(Dollars in thousands)
Selected Balance Sheet
Information:
Cash $6,376 $3,278 $5,226
Restricted cash 21,454 7,540 9,768
Retained interests in
securitizations
available-for-sale 20,564 22,636 24,680
Auto installment contracts
held-for-sale 234,824 75,021 129,371
Auto installment contracts
held-for-investment, net 6,975 252,863 147,703
Securitized auto installment
contracts held-for-investment,
net 349,417 -- --
Advances to parent -- 3,010 --
Other assets 10,884 7,969 7,704
Total assets $650,494 $372,317 $324,452
Warehouse credit facility
and other short-term
borrowings $229,446 $298,755 $246,006
Securitization notes payable 345,723 -- --
Advances from parent 58 -- 4,220
Current and deferred taxes, net 6,360 6,947 6,860
Other liabilities 5,282 4,277 5,187
Total liabilities 586,869 309,979 262,273
Stockholder's equity 63,625 62,338 62,179
Total liabilities and
stockholder's equity $650,494 $372,317 $324,452
BAY VIEW ACCEPTANCE CORPORATION (Continued)
(Unaudited)
For the Three Months Ended For the Nine Months Ended
Sept. 30, June 30, Sept. 30, Sept. 30, Sept. 30,
2005 2005 2004 2005 2004
(Dollars in thousands)
Selected
Results of
Operations
Information:
Interest
income on
auto
installment
contracts $10,305 $8,276 $5,170 $24,931 $13,477
Interest
income on
short-term
investments
and retained
interests in
securitizations 828 731 638 2,189 1,956
Interest
expense
on
borrowings (6,331) (5,100) (2,177) (15,090) (5,184)
Net
interest
income 4,802 3,907 3,631 12,030 10,249
Provision
for credit
losses (1,257) (1,793) (331) (3,887) (852)
Loan
servicing
income 398 468 712 1,409 2,472
Loan fees 222 160 204 532 610
Unrealized
gain (loss)
on derivative
instruments 738 (1,106) (1,757) 1,112 651
Loss on auto
installment
contracts
held-for-sale
and retained
interests in
securitizations (348) (356) (682) (1,224) (2,242)
Other
income, net 45 51 50 140 126
General and
administrative
expenses (2,976) (2,810) (2,668) (8,608) (8,324)
Income
(loss)
before
income taxes 1,624 (1,479) (841) 1,504 2,690
Income tax
(expense)
benefit (601) 615 293 (557) (1,159)
Net income
(loss) $1,023 $(864) $(548) $947 $ 1,531
Selected
Production
Information:
Dollar
value
of
auto
installment
contracts
purchased $147,521 $144,785 $69,474 $407,185 $214,658
Number of
auto
installment
contracts
purchased 6,281 6,089 2,364 17,071 7,154
Average
balance of
auto
installment
contracts
purchased $23.5 $23.8 $29.4 23.9 $30.0
Weighted-
average
contract
rate 9.04% 8.88% 8.06% 8.78% 7.94%
Average FICO
credit
score 734 734 742 736 736
Selected
Credit
Quality
Information:
Net
chargeoffs
on managed
contracts
for period $1,544 $1,525 $1,409 $4,713 $4,838
Net
chargeoffs
as a
percentage
of average
managed
contracts
(annualized) 0.85% 0.92% 1.01% 0.95% 1.15%
Contracts
delinquent
30 days or
more as a
percentage of
managed
contracts
(as of
period-end) 0.62% 0.40% 0.30% 0.62% 0.30%
Average
Managed
Contracts $727,125 $660,429 $557,744 $661,917 $561,332
At At At
September 30, December 31, September 30,
2005 2004 2004
(Dollars in thousands)
Managed Contracts (period-end):
Total outstanding managed
contracts $743,640 $570,864 $ 556,802
Total number of contracts 36,527 28,300 28,146
Other Data:
Full-time equivalent employees 90 104 101
Website: http://www.bayviewcapital.com/ |
Issuers of news releases and not PR Newswire are solely responsible for the accuracy of the content.
Terms and conditions, including restrictions on
redistribution, apply.
Copyright © 1996-2003 PR Newswire Association LLC.
All Rights Reserved.
A United Business Media company.
