- Net Income for the 2022 Fourth Quarter Was $300.8 Million,
or $4.65 Diluted Earnings Per Share, Versus $272.0 Million, or
$4.34 Diluted Earnings Per Share, Reported in the 2021 Fourth
Quarter. Pre-Tax, Pre-Provision Earnings for the 2022 Fourth
Quarter Were $450.6 Million, an Increase of $65.2 Million, or 16.9
Percent, Compared with $385.4 Million for the 2021 Fourth
Quarter
- Net Income for 2022 Was a Record $1.34 Billion, or $20.76
Diluted Earnings Per Share, Compared with $918.4 Million or $15.03
Diluted Earnings Per Share in 2021. Pre-Tax, Pre-Provision Earnings
for 2022 Were a Record $1.83 Billion, an Increase of $536.4
Million, or 41.3 Percent, Compared with $1.30 Billion for
2021
- Return on Common Equity Reaches a Record 16.35 Percent for
the Year 2022
- The Bank Declared a Cash Dividend of $0.70 Per Share, an
Increase of $0.14 Per Share, Payable on or After February 10, 2023
to Common Shareholders of Record at the Close of Business on
January 27, 2023. The Bank Also Declared a Cash Dividend of $12.50
Per Share Payable on or After March 30, 2023 to Preferred
Shareholders of Record at the Close of Business on March 17,
2023
- Total Deposits in the Fourth Quarter Declined $14.19 Billion
to $88.59 Billion. The Decline Was Primarily Driven by Our Planned
Reduction in Digital Asset Banking Deposits, Which Declined $7.35
Billion. In Conjunction with the Seventh Fed Funds Rate Increase,
We Decided Not to Match the December Increase in many of our
High-Cost, Traditional Deposits Which Led to a Decline. A Decrease
in 1031 Exchange Activity and Seasonal Outflows in the Mortgage
Servicing Industry, Which are Also High-Cost, Contributed to
Traditional Deposit Outflows
- Total Deposits for the Prior Twelve Months Declined $17.54
Billion, or 16.5 Percent. Excluding the Digital Asset Banking
Deposits, Which Were Down $12.39 Billion Due to Our Planned
Reduction in This Space and a Challenging Cryptocurrency
Environment, Total Deposits Declined $5.15 Billion
- As of January 13, 2023, Deposits Have Increased By $1.84
Billion Since Year End. This Includes an Increase in Traditional
Deposits of $2.53 Billion, Offset by a Decline in Digital Deposits
of $691 million
- For the 2022 Fourth Quarter, Loans Increased $452.3
Million. Since Year-end 2021, Loans Increased $9.43 Billion,
or 14.5 Percent
- Non-Accrual Loans Were $184.0 Million, or 0.25 Percent of
Total Loans, at December 31, 2022, Versus $185.3 Million, or 0.25
Percent, at the End of the 2022 Third Quarter and $218.3 Million,
or 0.34 Percent, at the End of the 2021 Fourth Quarter
- Net Interest Margin on a Tax-Equivalent Basis was 2.31
Percent, Compared With 2.38 Percent for the 2022 Third Quarter and
1.91 Percent for the 2021 Fourth Quarter
- Tier 1 Leverage, Common Equity Tier 1 Risk-Based, Tier 1
Risk-Based, and Total Risk-Based Capital Ratios were 8.79 Percent,
10.42 Percent, 11.21 Percent, and 12.33 Percent, Respectively, at
December 31, 2022. Signature Bank Remains Significantly Above FDIC
“Well Capitalized” Standards. Tangible Common Equity Ratio was 6.62
Percent
- During 2022, the Bank Hired 12 Private Client Banking Teams;
5 in New York and 7 on the West Coast. Additionally, Our Newest
National Banking Practice, the Health Care Banking and Finance
Team, Launched in the Second Quarter of 2022
Signature Bank (Nasdaq: SBNY), a New York-based full-service
commercial bank, today announced results for its fourth quarter
ended December 31, 2022.
Net income for the 2022 fourth quarter was $300.8 million, or
$4.65 diluted earnings per share, versus $272.0 million, or $4.34
diluted earnings per share, for the 2021 fourth quarter. The
increase in net income for the 2022 fourth quarter, versus the
comparable quarter last year, is primarily the result of an
increase in net interest income, fueled by strong loan and
securities growth, as well as higher interest rates. Pre-tax,
pre-provision earnings were $450.6 million for the 2022 fourth
quarter, representing an increase of $65.2 million, or 16.9
percent, compared with $385.4 million for the 2021 fourth
quarter.
Net interest income for the 2022 fourth quarter reached $638.7
million up $102.8 million, or 19.2 percent, when compared with the
fourth quarter of 2021. This increase is primarily due to strong
loan and securities growth along with higher prevailing market
interest rates. Total assets were $110.36 billion at December 31,
2022, decreasing $8.08 billion, or 6.8 percent, from $118.45
billion at December 31, 2021. Average assets for the 2022 fourth
quarter remained relatively flat at $112.71 billion versus the
comparable period a year ago.
Deposits for the 2022 fourth quarter decreased $14.19 billion,
to $88.59 billion, or 13.8 percent, including a non-interest
bearing deposit reduction of $5.86 billion, which brings our
non-interest bearing mix to 35.6 percent of total deposits at
December 31, 2022. Deposits over the last twelve months declined
16.5 percent, or $17.54 billion, when compared with deposits at the
end of 2021. The decline was driven by a challenging cryptocurrency
environment and our planned reduction in Digital Asset Banking
deposits, which were down $12.39 billion, along with our decision
not to match the December Fed Funds rate increase. Average total
deposits for 2022 were $103.43 billion, growing $18.12 billion, or
21.2 percent, versus average total deposits of $85.31 billion for
2021.
“At the onset of 2022, we set several goals, including the
hiring of numerous private client banking teams and hundreds of
colleagues to support our geographic expansion; increasing annual
earnings to a record level; and, growing both our loan and deposit
portfolios substantially. Most of these were met. During the 2022
second quarter, our newest national business line, the Healthcare
Banking and Finance team, was launched. Throughout the year, 12
private client banking teams were onboarded, 3 of which in Nevada,
marking the Bank’s entry into the state. To support this team
growth, we added hundreds of colleagues across various operational
and support areas. Although we grew loans by a strong $9.43
billion, 2022 presented deposit challenges. While we expected to
see continued deposit growth, albeit not at 2020 or 2021 levels,
seven Fed rate hikes during 2022 totaling 425 basis points, coupled
with quantitative tightening and the proliferation of off balance
sheet alternatives, resulted in the most difficult deposit
environment we have seen in our 22-year history. The arduous rate
environment, along with challenges in the digital asset space, led
to deposit declines, which we overcame with little difficulty,
given our robust liquidity position. Despite these deposit
headwinds, we still earned record net income of $1.34 billion and a
record return on common equity of 16.35 percent for the year,” said
Joseph J. DePaolo, Signature Bank President and Chief Executive
Officer.
“Looking ahead, we have plans to further grow our established
franchise in 2023 by continuing our effort to hire new banking
teams and expanding geographically while remaining mindful of the
volatile economic environment. We see growth on the horizon because
when Signature Bank lifts out banking teams, it is with top
performers who should thrive through our private client banking
approach. We look forward to future successes as we stay with our
founding and distinguishing single-point-of-contact, team-based
banking model, which is the hallmark of our institution,” DePaolo
concluded.
Scott A. Shay, Chairman of the Board, added: “Over the years, we
have continued to reiterate that Signature Bank was built to be
well positioned to navigate tough times, and we continue to prove
this to be the case. Throughout our 22 years in operation, this
institution has faced many economic challenges, including NYC job
losses in 2001-2002 as a result of the 9-11 tragedy, which happened
only four short months after our founding. This was followed by the
Great Financial Crisis of 2008-2010, the COVID-19 shutdown and the
list goes on. On the heels of every challenge, Signature Bank
emerged stronger, which will be the case this time as well.
With more than half a trillion dollars of deposits leaving the
banking system in the second and third quarters of 2022 alone, the
market for deposits has turned quite competitive. In that context,
Signature Bank consciously decided to exit deposit relationships in
certain traditional banking sectors that sought the highest
marginal pricing from banks willing to pay maximum interest rates.
We believe our service is invaluable, and the overwhelming majority
of our clients appreciate that.
We remain very optimistic about the future prospects of
Signature Bank. Our increasing the quarterly dividend is a sheer
reflection of that confidence as well as our ability to continue to
deliver consistent earnings to our shareholders."
Net Interest Income
Net interest income for the 2022 fourth quarter was $638.7
million, an increase of $102.8 million, or 19.2 percent, when
compared with the same period last year, primarily due to loans and
securities growth along with higher prevailing market interest
rates. Average interest-earning assets of $110.13 billion for the
2022 fourth quarter represent a decrease of $1.50 billion, or 1.3
percent, from the 2021 fourth quarter. Due to higher interest rates
across all of our asset classes, the yield on interest-earning
assets for the 2022 fourth quarter increased 202 basis points to
4.18 percent, compared to the fourth quarter of last year.
Average cost of deposits and average cost of funds for the
fourth quarter of 2022 each increased by 172 basis points, to 1.91
percent and 1.99 percent, respectively, versus the comparable
period a year ago.
Net interest margin on a tax-equivalent basis for the 2022
fourth quarter was 2.31 percent versus 2.38 percent in the 2022
third quarter, and 1.91 percent reported in the 2021 fourth
quarter.
Provision for Credit Losses
The Bank’s provision for credit losses for the fourth quarter of
2022 was $42.8 million, an increase of $35.9 million, or over 100
percent, versus the 2021 fourth quarter. The increase in the
provision for credit losses for the fourth quarter, compared to the
same quarter last year, was predominantly attributable to a
deteriorating macroeconomic forecast, particularly related to
interest rate, GDP and unemployment forecasts, compared with the
same period last year.
Net charge-offs for the 2022 fourth quarter were $18.2 million,
or 0.10 percent of average loans, on an annualized basis, versus
$10.2 million, or 0.06 percent, for the 2022 third quarter and net
charge-offs of $33.7 million, or 0.22 percent, for the 2021 fourth
quarter.
Non-Interest Income and Non-Interest Expense
Non-interest income for the 2022 fourth quarter was $45.2
million, up $11.8 million when compared with $33.5 million reported
in the 2021 fourth quarter. The increase was primarily due to a
$9.2 million increase in fees and service charges and a $4.2
million increase in other income, primarily foreign currency
activity. This was partially offset by a decrease of $2.2 million
in net gains on sales of loans.
Non-interest expense for the fourth quarter of 2022 was $233.3
million, an increase of $49.4 million, or 26.8 percent, versus
$183.9 million reported in the 2021 fourth quarter. The increase
was predominantly due to the addition of new private client banking
teams, national banking practices, and operational personnel, as
well as client activity related expenses that have increased with
the growth in our clients and businesses.
The Bank’s efficiency ratio was 34.11 percent for the 2022
fourth quarter compared with 32.31 percent for the same period a
year ago, and 31.41 percent for the third quarter of 2022.
Loans
Loans, excluding loans held for sale, increased $452.3 million
to $74.29 billion in the 2022 fourth quarter, versus $73.84 billion
at September 30, 2022. Average loans, excluding loans held for
sale, reached $74.46 billion in the 2022 fourth quarter, growing
$0.99 billion, or 1.3 percent, from the 2022 third quarter and
$13.96 billion, or 23.1 percent, from the fourth quarter of
2021.
At December 31, 2022, non-accrual loans were $184.0 million,
representing 0.25 percent of total loans and 0.17 percent of total
assets, compared with non-accrual loans of $185.3 million, or 0.25
percent of total loans, at September 30, 2022 and $218.3 million,
or 0.34 percent of total loans, at December 31, 2021. At December
31, 2022, the ratio of allowance for credit losses for loans and
leases to total loans, was 0.66 percent, versus 0.63 percent at
September 30, 2022 and 0.73 percent at December 31, 2021.
Additionally, the ratio of allowance for credit losses for loans
and leases to non-accrual loans, or the coverage ratio, was 266
percent for the 2022 fourth quarter versus 251 percent for the
third quarter of 2022 and 217 percent for the 2021 fourth
quarter.
Capital
The Bank’s Tier 1 leverage, common equity Tier 1 risk-based,
Tier 1 risk-based, and total risk-based capital ratios were
approximately 8.79 percent, 10.42 percent, 11.21 percent, and 12.33
percent, respectively, as of December 31, 2022. Each of these
ratios is well in excess of regulatory requirements. The Bank’s
strong risk-based capital ratios reflect the relatively low risk
profile of the Bank’s balance sheet. The Bank’s tangible common
equity ratio remains strong at 6.62 percent.
The Bank declared a cash dividend of $0.70 per share, a $0.14
per share increase, payable on or after February 10, 2023 to common
stockholders of record at the close of business on January 27,
2023. The Bank also declared a cash dividend of $12.50 per share
payable on or after March 30, 2023 to preferred shareholders of
record at the close of business on March 17, 2023. In the fourth
quarter of 2022, the Bank paid a cash dividend of $0.56 per share
to common stockholders of record at the close of business on
October 29, 2022. The Bank also paid a cash dividend of $12.50 per
share to preferred shareholders of record at the close of business
on December 17, 2021.
Conference Call
Signature Bank’s management will host a conference call to
review results of its 2022 fourth quarter and year ended December
31, 2022 on Tuesday, January 17, 2023 at 8:00 AM ET. All U.S.
participants should dial 800-274-8461 and international callers
should dial 203-518-9814 at least ten minutes prior to the start of
the call and reference conference ID SBNYQ422.
To hear a live web simulcast or to listen to the archived web
cast following completion of the call, please visit the Bank’s web
site at www.signatureny.com, click on “Investor Information,”
"Quarterly Results/Conference Calls" to access the link to the
call.
An earnings slide presentation accompanying the call will be
accessible through the live web cast and available on Signature
Bank’s website here.
To listen to a telephone replay of the conference call, please
dial 800-934-4245 or 402-220-1173. The replay will be available
from approximately 12:00 PM ET on Tuesday, January 17, 2023 through
11:59 PM ET on Friday, January 20, 2023.
About Signature Bank
Signature Bank, member FDIC, is a New York-based full-service
commercial bank with 40 private client offices throughout the
metropolitan New York area, as well as those in Connecticut,
California, Nevada and North Carolina. Through its
single-point-of-contact approach, the Bank’s private client banking
teams primarily serve the needs of privately owned businesses,
their owners and senior managers. The Bank has two wholly owned
subsidiaries: Signature Financial, LLC, provides equipment finance
and leasing; and, Signature Securities Group Corporation, a
licensed broker-dealer, investment adviser and member FINRA/SIPC,
offers investment, brokerage, asset management and insurance
products and services. Signature Bank was the first FDIC-insured
bank to launch a blockchain-based digital payments platform.
Signet™ allows commercial clients to make real-time payments in
U.S. dollars, 24/7/365 and was also the first blockchain-based
solution to be approved for use by the NYS Department of Financial
Services.
Signature Bank placed 19th on S&P Global’s list of the
largest banks in the U.S., based on deposits.
For more information, please visit
https://www.signatureny.com/.
This press release and oral statements made from time to time by
our representatives contain "forward-looking statements" within the
meaning of the Private Securities Litigation Reform Act of 1995.
You should not place undue reliance on those statements because
they are subject to numerous risks and uncertainties relating to
our operations and business environment, all of which are difficult
to predict and may be beyond our control. Forward-looking
statements include information concerning our expectations
regarding future results, interest rates and the interest rate
environment, loan and deposit growth, loan performance, operations,
new private client teams' hires, new office openings, business
strategy and the impact of the COVID-19 pandemic on each of the
foregoing and on our business overall. Forward-looking statements
often include words such as "may," "believe," "expect,"
"anticipate," "intend," “potential,” “opportunity,” “could,”
“project,” “seek,” “target,” “goal,” “should,” “will,” “would,”
"plan," "estimate" or other similar expressions. Forward-looking
statements may also address our sustainability progress, plans, and
goals (including climate change and environmental-related matters
and disclosures), which may be based on standards for measuring
progress that are still developing, internal controls and processes
that continue to evolve, and assumptions that are subject to change
in the future. As you consider forward-looking statements, you
should understand that these statements are not guarantees of
performance or results. They involve risks, uncertainties and
assumptions that could cause actual results to differ materially
from those in the forward-looking statements and can change as a
result of many possible events or factors, not all of which are
known to us or in our control. These factors include but are not
limited to: (i) prevailing economic conditions; (ii) changes in
interest rates, loan demand, real estate values and competition,
any of which can materially affect origination levels and gain on
sale results in our business, as well as other aspects of our
financial performance, including earnings on interest-bearing
assets; (iii) the level of defaults, losses and prepayments on
loans made by us, whether held in portfolio or sold in the whole
loan secondary markets, which can materially affect charge-off
levels and required credit loss reserve levels; (iv) changes in
monetary and fiscal policies of the U.S. Government, including
policies of the U.S. Treasury and the Board of Governors of the
Federal Reserve System; (v) changes in the banking and other
financial services regulatory environment; (vi) our ability to
maintain the continuity, integrity, security and safety of our
operations and (vii) competition for qualified personnel and
desirable office locations. All of these factors are subject to
additional uncertainty in the context of the COVID-19 pandemic and
the conflict in Ukraine, which are having impacts on all aspects of
our operations, the financial services industry and the economy as
a whole. Additional risks are described in our quarterly and annual
reports filed with the FDIC. Although we believe that these
forward-looking statements are based on reasonable assumptions,
beliefs and expectations, if a change occurs or our beliefs,
assumptions and expectations were incorrect, our business,
financial condition, liquidity or results of operations may vary
materially from those expressed in our forward-looking statements.
You should keep in mind that any forward-looking statements made by
Signature Bank speak only as of the date on which they were made.
New risks and uncertainties come up from time to time, and we
cannot predict these events or how they may affect the Bank.
Signature Bank has no duty to, and does not intend to, update or
revise the forward-looking statements after the date on which they
are made.
FINANCIAL TABLES ATTACHED
SIGNATURE BANK
CONSOLIDATED STATEMENTS OF
INCOME
(unaudited)
Three months ended December
31,
Twelve months ended December
31,
(dollars in thousands, except per share
amounts)
2022
2021
2022
2021
INTEREST INCOME
Loans and leases
$
902,026
516,287
2,798,945
1,892,787
Loans held for sale
4,586
955
12,983
4,157
Securities available-for-sale
122,051
58,902
401,783
194,825
Securities held-to-maturity
41,359
16,199
115,994
54,949
Other investments
87,217
13,966
220,632
43,663
Total interest income
1,157,239
606,309
3,550,337
2,190,381
INTEREST EXPENSE
Deposits
475,183
46,920
913,563
210,644
Federal funds purchased and securities
sold under agreements to repurchase
602
602
2,381
2,401
Federal Home Loan Bank borrowings
36,610
16,699
74,444
67,745
Subordinated debt
6,167
6,167
24,615
29,067
Total interest expense
518,562
70,388
1,015,003
309,857
Net interest income before provision for
credit losses
638,677
535,921
2,535,334
1,880,524
Provision for credit losses
42,761
6,877
78,770
50,042
Net interest income after provision for
credit losses
595,916
529,044
2,456,564
1,830,482
NON-INTEREST INCOME
Fees and service charges
30,721
21,501
107,206
75,068
Commissions
4,696
4,020
17,694
16,253
Net losses on sales of securities
(84
)
—
(900
)
—
Net gains on sale of loans
2,855
5,065
11,282
19,170
Other income
7,034
2,869
25,755
10,401
Total non-interest income
45,222
33,455
161,037
120,892
NON-INTEREST EXPENSE
Salaries and benefits
131,435
123,104
524,766
458,885
Occupancy and equipment
12,771
12,160
51,265
46,473
Information technology
15,906
13,103
60,791
48,536
FDIC assessment fees
6,742
7,437
30,344
24,543
Professional fees
10,621
8,589
44,077
30,989
Other general and administrative
55,835
19,555
150,954
94,174
Total non-interest expense
233,310
183,948
862,197
703,600
Income before income taxes
407,828
378,551
1,755,404
1,247,774
Income tax expense
106,982
106,560
418,355
329,333
Net income
$
300,846
271,991
1,337,049
918,441
Preferred stock dividends
9,125
9,125
36,500
37,887
Net income available to common
shareholders
$
291,721
262,866
1,300,549
880,554
PER COMMON SHARE DATA
Earnings per common share - basic
$
4.67
4.38
20.88
15.20
Earnings per common share - diluted
$
4.65
4.34
20.76
15.03
Dividends per common share
$
0.56
0.56
2.24
2.24
SIGNATURE BANK
CONSOLIDATED STATEMENTS OF FINANCIAL
CONDITION
December 31,
2022
2021
(dollars in thousands, except shares and
per share amounts)
(unaudited)
ASSETS
Cash and due from banks
$
5,874,527
29,547,574
Short-term investments
80,116
73,097
Total cash and cash equivalents
5,954,643
29,620,671
Securities available-for-sale (amortized
cost $21,071,366 at December 31, 2022 and $17,398,906 at December
31, 2021); (zero allowance for credit losses at December 31, 2022
and at December 31, 2021)
18,594,056
17,152,863
Securities held-to-maturity (fair value
$7,018,200 at December 31, 2022 and $4,944,777 December 31, 2021);
(allowance for credit losses $25 at December 31, 2022 and $56 at
December 31, 2021)
7,780,374
4,998,281
Federal Home Loan Bank stock
560,343
166,697
Loans held for sale
586,452
386,765
Loans and leases
74,292,404
64,862,798
Allowance for credit losses for loans and
leases
(489,862
)
(474,389
)
Loans and leases, net
73,802,542
64,388,409
Premises and equipment, net
117,229
92,232
Operating lease right-of-use assets
249,269
225,988
Accrued interest and dividends
receivable
449,815
306,827
Other assets
2,268,928
1,106,694
Total assets
$
110,363,651
118,445,427
LIABILITIES AND SHAREHOLDERS'
EQUITY
Deposits
Non-interest-bearing
$
31,512,400
44,363,215
Interest-bearing
57,077,327
61,769,579
Total deposits
88,589,727
106,132,794
Federal funds purchased and securities
sold under agreements to repurchase
150,000
150,000
Federal Home Loan Bank borrowings
11,283,738
2,639,245
Subordinated debt
571,635
570,228
Operating lease liabilities
281,570
254,660
Accrued expenses and other liabilities
1,473,880
857,882
Total liabilities
102,350,550
110,604,809
Shareholders' equity
Preferred stock, par value $.01 per share;
61,000,000 shares authorized; 730,000 shares issued and outstanding
at December 31, 2022 and December 31, 2021
7
7
Common stock, par value $.01 per share;
125,000,000 and 64,000.000 shares authorized at December 31, 2022
and December 31, 2021, respectively; 63,064,643 shares issued and
62,928,819 outstanding at December 31, 2022;60,729,674 shares
issued and 60,631,944 outstanding at December 31, 2021
629
606
Additional paid-in capital
4,551,819
3,763,810
Retained earnings
5,457,886
4,298,527
Accumulated other comprehensive loss
(1,997,240
)
(222,332
)
Total shareholders' equity
8,013,101
7,840,618
Total liabilities and shareholders'
equity
$
110,363,651
118,445,427
SIGNATURE BANK
FINANCIAL SUMMARY, CAPITAL RATIOS,
ASSET QUALITY
(unaudited)
Three months ended December
31,
Twelve months ended December
31,
(in thousands, except ratios and per share
amounts)
2022
2021
2022
2021
PER COMMON SHARE
Earnings per common share - basic
$
4.67
$
4.38
$
20.88
$
15.20
Earnings per common share - diluted
$
4.65
$
4.34
$
20.76
$
15.03
Weighted average common shares outstanding
- basic
62,440
60,003
62,250
57,871
Weighted average common shares outstanding
- diluted
62,627
60,563
62,605
58,508
Book value per common share
$
116.08
$
117.63
$
116.08
$
117.63
SELECTED FINANCIAL DATA
Return on average total assets
1.06
%
0.96
%
1.15
%
0.95
%
Return on average common shareholders'
equity
16.35
%
14.76
%
17.55
%
13.81
%
Efficiency ratio (1)
34.11
%
32.31
%
31.98
%
35.16
%
Yield on interest-earning assets
4.17
%
2.15
%
3.10
%
2.28
%
Yield on interest-earning assets,
tax-equivalent basis (1)(2)
4.18
%
2.16
%
3.11
%
2.29
%
Cost of deposits and borrowings
1.99
%
0.27
%
0.95
%
0.35
%
Net interest margin
2.30
%
1.90
%
2.22
%
1.96
%
Net interest margin, tax-equivalent basis
(2)(3)
2.31
%
1.91
%
2.23
%
1.97
%
(1)
See "Non-GAAP Financial Measures" for
related calculation.
(2)
Based on the 21 percent U.S. federal
statutory tax rate for the periods presented. The tax-equivalent
basis is considered a non-GAAP financial measure and should be
considered in addition to, not as a substitute for or superior to,
financial measures determined in accordance with GAAP. This ratio
is a metric used by management to evaluate the impact of tax-exempt
assets on the Bank's yield on interest-earning assets and net
interest margin.
(3)
See "Net Interest Margin Analysis" for
related calculation.
December 31,
2022
September 30,
2022
December 31,
2021
CAPITAL RATIOS
Tangible common equity (4)
6.62
%
6.10
%
6.02
%
Tier 1 leverage (5)
8.79
%
8.47
%
7.27
%
Common equity Tier 1 risk-based (5)
10.42
%
10.11
%
9.60
%
Tier 1 risk-based (5)
11.21
%
10.90
%
10.51
%
Total risk-based (5)
12.33
%
11.99
%
11.76
%
ASSET QUALITY
Non-accrual loans
$
183,961
$
185,300
$
218,295
Allowance for credit losses for loans and
leases (ACLLL)
$
489,862
$
464,858
$
474,389
ACLLL to non-accrual loans
266.29
%
250.87
%
217.32
%
ACLLL to total loans
0.66
%
0.63
%
0.73
%
Non-accrual loans to total loans
0.25
%
0.25
%
0.34
%
Quarterly net charge-offs to average
loans, annualized
0.10
%
0.06
%
0.22
%
(4)
We define tangible common equity as the
ratio of total tangible common equity to total tangible assets (the
"TCE ratio"). Tangible common equity is considered to be a non-GAAP
financial measure and should be considered in addition to, not as a
substitute for or superior to, financial measures determined in
accordance with GAAP. The TCE ratio is a metric used by management
to evaluate the adequacy of our capital levels. In addition to
tangible common equity, management uses other metrics, such as Tier
1 capital related ratios, to evaluate capital levels.
(5)
December 31, 2022 ratios are
preliminary.
SIGNATURE BANK
NET INTEREST MARGIN ANALYSIS
(unaudited)
Three Months Ended
December 31, 2022
Three Months Ended
December 31, 2021
(dollars in thousands)
Average Balance
Interest Income/
Expense
Average Yield/ Rate
Average Balance
Interest Income/
Expense
Average Yield/ Rate
INTEREST-EARNING ASSETS
Short-term investments
$
8,565,395
82,230
3.84
%
30,474,298
11,831
0.15
%
Investment securities
26,630,543
168,397
2.53
%
20,297,693
77,236
1.52
%
Commercial loans, mortgages and leases
74,347,595
902,889
4.82
%
60,358,789
516,861
3.40
%
Residential mortgages and consumer
loans
108,490
1,381
5.05
%
139,935
1,126
3.19
%
Loans held for sale
478,238
4,586
3.80
%
356,256
955
1.06
%
Total interest-earning assets (1)
110,130,261
1,159,483
4.18
%
111,626,971
608,009
2.16
%
Non-interest-earning assets
2,580,676
1,101,262
Total assets
$
112,710,937
112,728,233
INTEREST-BEARING LIABILITIES
Interest-bearing deposits
NOW and interest-bearing demand
$
22,799,246
181,836
3.16
%
18,694,556
15,862
0.34
%
Money market
36,238,210
263,286
2.88
%
41,433,741
28,030
0.27
%
Time deposits
3,719,121
30,061
3.21
%
1,583,242
3,028
0.76
%
Non-interest-bearing demand deposits
35,855,867
—
—
%
38,876,207
—
—
%
Total deposits
98,612,444
475,183
1.91
%
100,587,746
46,920
0.19
%
Subordinated debt
571,402
6,167
4.32
%
569,998
6,167
4.33
%
Other borrowings
3,968,074
37,212
3.72
%
2,805,278
17,301
2.45
%
Total deposits and borrowings
103,151,920
518,562
1.99
%
103,963,022
70,388
0.27
%
Other non-interest-bearing liabilities
1,772,228
989,002
Preferred equity
708,173
708,173
Common equity
7,078,616
7,068,036
Total liabilities and shareholders'
equity
$
112,710,937
112,728,233
OTHER DATA
Net interest income / interest rate spread
(1)
$
640,921
2.19
%
537,621
1.89
%
Tax-equivalent adjustment
(2,244
)
(1,700
)
Net interest income, as reported
$
638,677
535,921
Net interest margin
2.30
%
1.90
%
Tax-equivalent effect
0.01
%
0.01
%
Net interest margin on a tax-equivalent
basis (1)
2.31
%
1.91
%
Ratio of average interest-earning assets
to average interest-bearing liabilities
106.77
%
107.37
%
(1)
Presented on a tax-equivalent, non-GAAP,
basis for municipal leasing and financing transactions recorded in
Commercial loans, mortgages and leases using the U.S. federal
statutory tax rate of 21 percent for the periods presented.
SIGNATURE BANK
NET INTEREST MARGIN ANALYSIS
(unaudited)
Twelve Months Ended December 31,
2022
Twelve Months Ended December 31,
2021
(dollars in thousands)
Average Balance
Interest Income/
Expense
Average Yield/ Rate
Average Balance
Interest Income/
Expense
Average Yield/ Rate
INTEREST-EARNING ASSETS
Short-term investments
$
17,402,433
208,906
1.18
%
25,167,623
35,009
0.14
%
Investment securities
25,950,867
529,503
2.04
%
15,908,371
258,428
1.62
%
Commercial loans, mortgages and leases
70,294,647
2,802,119
3.99
%
54,332,257
1,894,745
3.49
%
Residential mortgages and consumer
loans
120,493
4,577
3.80
%
148,137
4,933
3.33
%
Loans held for sale
503,598
12,983
2.58
%
306,202
4,157
1.36
%
Total interest-earning assets (1)
114,272,038
3,558,088
3.11
%
95,862,590
2,197,272
2.29
%
Non-interest-earning assets
1,892,462
941,161
Total assets
$
116,164,500
96,803,751
INTEREST-BEARING LIABILITIES
Interest-bearing deposits
NOW and interest-bearing demand
$
21,556,982
381,228
1.77
%
18,296,459
73,622
0.40
%
Money market
39,438,596
489,121
1.24
%
36,492,490
121,416
0.33
%
Time deposits
2,146,411
43,214
2.01
%
1,759,229
15,606
0.89
%
Non-interest-bearing demand deposits
40,290,382
—
—
%
28,764,155
—
—
%
Total deposits
103,432,371
913,563
0.88
%
85,312,333
210,644
0.25
%
Subordinated debt
570,877
24,615
4.31
%
646,359
29,067
4.50
%
Other borrowings
2,617,723
76,825
2.93
%
2,879,793
70,146
2.44
%
Total deposits and borrowings
106,620,971
1,015,003
0.95
%
88,838,485
309,857
0.35
%
Other non-interest-bearing liabilities
1,425,841
878,876
Preferred equity
708,173
708,109
Common equity
7,409,515
6,378,281
Total liabilities and shareholders'
equity
$
116,164,500
96,803,751
OTHER DATA
Net interest income / interest rate spread
(1)
$
2,543,085
2.16
%
1,887,415
1.94
%
Tax-equivalent adjustment
(7,751
)
(6,891
)
Net interest income, as reported
$
2,535,334
1,880,524
Net interest margin
2.22
%
1.96
%
Tax-equivalent effect
0.01
%
0.01
%
Net interest margin on a tax-equivalent
basis (1)
2.23
%
1.97
%
Ratio of average interest-earning assets
to average interest-bearing liabilities
107.18
%
107.91
%
(1)
Presented on a tax-equivalent, non-GAAP,
basis for municipal leasing and financing transactions recorded in
Commercial loans, mortgages and leases using the U.S. federal
statutory tax rate of 21 percent for the periods presented.
SIGNATURE BANK NON-GAAP FINANCIAL MEASURES
(unaudited)
This press release contains both financial measures based on
GAAP and non-GAAP financial measures where management believes that
the presentation of certain non-GAAP financial measures assists
investors when comparing results period-to-period in a more
consistent manner and provides a better measure of Signature Bank's
results. These non-GAAP measures include the Bank's (i) tangible
common equity ratio, (ii) efficiency ratio, (iii) yield on
interest-earning assets, tax-equivalent basis, (iv) net interest
margin, tax-equivalent basis, and (v) pre-tax, pre-provision
earnings. These non-GAAP measures should not be considered a
substitute for GAAP-basis measures and results. We strongly
encourage investors to review our consolidated financial statements
in their entirety and not to rely on any single financial measure.
Because non-GAAP financial measures are not standardized, it may
not be possible to compare these financial measures with other
companies' non-GAAP financial measures having the same or similar
names.
The following table presents the tangible common equity ratio
calculation:
(dollars in thousands)
December 31,
2022
September 30,
2022
December 31,
2021
Consolidated total shareholders'
equity
$
8,013,101
7,690,523
7,840,618
Less: Preferred equity
708,173
708,173
708,173
Common shareholders' equity
$
7,304,928
6,982,350
7,132,445
Less: Intangible assets
398
2,025
3,977
Tangible common shareholders' equity
(TCE)
$
7,304,530
6,980,325
7,128,468
Consolidated total assets
$
110,363,651
114,468,746
118,445,427
Less: Intangible assets
398
2,025
3,977
Consolidated tangible total assets
(TTA)
$
110,363,253
114,466,721
118,441,450
Tangible common equity ratio (TCE/TTA)
6.62
%
6.10
%
6.02
%
The following table presents the efficiency ratio
calculation:
Three months ended December
31,
Twelve months ended December
31,
(dollars in thousands)
2022
2021
2022
2021
Non-interest expense (NIE)
$
233,310
183,948
862,197
703,600
Net interest income before provision for
credit losses
638,677
535,921
2,535,334
1,880,524
Other non-interest income
45,222
33,455
161,037
120,892
Total income (TI)
$
683,899
569,376
2,696,371
2,001,416
Efficiency ratio (NIE/TI)
34.11
%
32.31
%
31.98
%
35.16
%
The following table reconciles yield on interest-earning assets
to the yield on interest-earning assets on a tax-equivalent
basis:
Three months ended December
31,
Twelve months ended December
31,
(dollars in thousands)
2022
2021
2022
2021
Interest income (as reported)
$
1,157,239
606,309
3,550,337
2,190,381
Tax-equivalent adjustment
2,244
1,700
7,751
6,891
Interest income, tax-equivalent basis
$
1,159,483
608,009
3,558,088
2,197,272
Interest-earnings assets
$
110,130,261
111,626,971
114,272,038
95,862,590
Yield on interest-earning assets
4.17
%
2.15
%
3.10
%
2.28
%
Tax-equivalent effect
0.01
%
0.01
%
0.01
%
0.01
%
Yield on interest-earning assets,
tax-equivalent basis
4.18
%
2.16
%
3.11
%
2.29
%
The following table reconciles net interest margin (as reported)
to net interest margin on a tax-equivalent basis:
Three months ended December
31,
Three months ended September
30,
Twelve months ended December
31,
(dollars in thousands)
2022
2021
2022
2021
2022
2021
Net interest margin (as reported)
2.30%
1.90%
2.37%
1.88%
2.22%
1.96%
Tax-equivalent adjustment
0.01%
0.01%
0.01%
0.00%
0.01%
0.01%
Net interest margin, tax-equivalent
basis
2.31%
1.91%
2.38%
1.88%
2.23%
1.97%
The following table reconciles net income (as reported) to
pre-tax, pre-provision earnings:
Three months ended December
31,
Twelve months ended December
31,
(dollars in thousands)
2022
2021
2022
2021
Net income (as reported)
$
300,846
271,991
1,337,049
918,441
Income tax expense
106,982
106,560
418,355
329,333
Provision for credit losses
42,761
6,877
78,770
50,042
Pre-tax, pre-provision earnings
$
450,589
385,428
1,834,174
1,297,816
View source
version on businesswire.com: https://www.businesswire.com/news/home/20230117005330/en/
Investor Contact: Brian Wyremski,
Senior Vice President and Director of Investor Relations &
Corporate Development 646-822-1479, bwyremski@signatureny.com
Media Contact: Susan Turkell Lewis,
646-822-1825, slewis@signatureny.com
Signature Bank (NASDAQ:SBNY)
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