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Press Release

Signature Bank Reports 2006 Second Quarter Results

Company Release - 7/27/2006 6:00 AM ET

NEW YORK--(BUSINESS WIRE)--July 27, 2006--

Signature Bank (Nasdaq:SBNY):

    --  Deposits Grew $391 Million to $3.71 Billion, Impacted by an
        Inflow of Short-Term Escrow Deposits

    --  Loans Increased $157 Million to $1.26 Billion

    --  Net Interest Margin Holds Steady at 2.81 Percent

    --  Net Income Reached $8.2 Million or $0.28 Diluted Earnings Per
        Share, An Increase of $11.9 Million from the Second Quarter of
        2005; Net Income Increased $2.4 Million or 41 Percent Compared
        with Operating Net Income for the Second Quarter of 2005
        (Excluding the Effect of the 2005 Special One-Time Bonus of
        $12 Million)

    --  Three Private Client Banking Teams Joined During the Second
        Quarter; Two Additional Teams Added at the Onset of the 2006
        Third Quarter, Bringing Year-to-Date Number of New Teams to
        Seven

Signature Bank (Nasdaq:SBNY), a New York-based full-service commercial bank, today announced results for its 2006 second quarter ended June 30, 2006.

Net income for the quarter reached $8.2 million or $0.28 diluted earnings per share, compared with a net loss of $3.7 million or $0.12 diluted loss per share for the second quarter a year ago. Net income increased $2.4 million or 41 percent compared with operating net income for the second quarter of 2005, excluding the effects in 2005 of the special one-time bonus of cash and stock totaling $12.0 million, contributed by the Bank's former principal shareholder, in connection with the sale of their controlling shares. The net income growth is a result of increases in both net interest income and non-interest income, coupled with non-interest expense containment.

Net interest income for the quarter totaled $29.6 million, an increase of $6.5 million or 28 percent when compared with the second quarter of 2005. Total assets reached $4.7 billion at the end of the 2006 second quarter.

Deposits grew $390.6 million, or 12 percent, to $3.71 billion at June 30, 2006. Similar to other quarters, included in this amount are significant short-term escrow deposits, which, due to their nature and as expected, have been or will be released during the third quarter of 2006. The overall deposit growth represents an increase of more than $800.8 million, or 28 percent, when compared with deposits at June 30, 2005. Core deposits of $3.46 billion represent over 93 percent of total deposits.

"We certainly recognize that there are many opportunities available in the marketplace today due to continued consolidation and change. Clearly, we have positioned Signature Bank to take advantage of such opportunities. We are a very focused organization and have learned what we do best, as evidenced by the proven track record and steady core growth we have established since our inception five years ago," noted Joseph J. DePaolo, President and Chief Executive Officer.

"However, although we have enjoyed solid growth to date by serving the privately owned business niche and are making significant progress, we realize that we must have an even greater sense of urgency in this turbulent and competitive banking landscape to turn prospects into clients and deliver on their needs. We need to do more to capture potential clients who are re-thinking their current banking relationships with other institutions to ensure they choose Signature Bank. That said, we will strive to prudently increase core deposits and expand our loan portfolio at a faster pace, while continuing to recruit veteran banking teams, foster client relationships and grow this institution," DePaolo said.

Scott A. Shay, Chairman of the Board, added: "Despite a challenging capital markets environment and intensely competitive financial services arena, we maintained a stable net interest margin utilizing conservative balance sheet management strategies. Over the long-term, the net interest margin will be driven by growth in core deposits and loans generated from our relationship banking model. We continue to aggressively attract new teams, which will positively impact our financial performance and results toward this end."

Net Interest Income

Net interest income for the 2006 second quarter was $29.6 million, up 28 percent or $6.5 million from the same period last year. The net interest income growth was fueled by earning asset growth and an increased net interest margin. Average interest-earning assets for the second quarter of 2006 increased by $839.6 million, reflecting a 25 percent increase from the second quarter of last year. The net interest margin for the second quarter of 2006 increased 8 basis points to 2.81 percent when compared with the 2005 second quarter and on a linked quarter basis remained stable, down one basis point. Asset yields for the 2006 second quarter strengthened by 111 basis points to 5.40 percent, when compared with the 2005 second quarter, reflecting an improved asset mix and a more favorable market condition. During the second quarter, the average cost of funds increased by 103 basis points to 2.67 percent when compared with the same period last year and the average cost of deposits increased 93 basis points to 2.29 percent. The increases in costs of funds and deposits are reflective of the current interest rate environment and competitive marketplace.

The flat yield curve and competitive deposit market continue to present challenges for the Bank and industry. Net interest margin expansion will remain dependent upon increased core deposits and continued improvement in the loan-to-asset mix. Additionally, large movements in escrow deposits can cause considerable changes in margins in any given quarter.

Non-Interest Income and Non-Interest Expense

Non-interest income for the second quarter of 2006 rose 11 percent to $5.1 million versus $4.6 million reported for the same quarter last year. This improvement was largely the result of a $372,000 rise in fees and service charges.

Non-interest expense for the quarter ended June 30, 2006, was $19.3 million, compared with $28.6 million in the second quarter a year ago. Excluding the effects of the special one-time bonus paid in the second quarter of 2005, non-interest expense increased $2.7 million or 16 percent. This increase is primarily due to the addition of new private client teams and locations. At the close of the 2006 second quarter, the Bank had 53 Group Directors and 43 private client teams in place versus 43 Group Directors and 34 teams, respectively, at the end of the second quarter of last year. This represents an increase of about 25 percent, or ten Group Directors and nine teams added since the second quarter of last year.

The Bank's efficiency ratio improved to 55.7 percent for the second quarter of 2006, compared with 57.3 percent for the first quarter of 2006, primarily due to the growth in interest income and non-interest income, along with prudent expense management.

Loans

For the second quarter, loans, excluding loans held for sale, increased $156.7 million or 14.2 percent to $1.26 billion at June 30, 2006, compared with $1.10 billion at March 31, 2006. At June 30, 2006, loans to total assets stand at 26.8 percent, up from 24.5 percent at the end of the first quarter of 2006.

Loans held for sale were $105.7 million as of June 30, 2006, a decrease of 2.5 percent or $2.7 million from March 31, 2006. The periodic fluctuation in loans held for sale is primarily due to the timing of SBA loan purchases and subsequent pool sales.

At June 30, 2006, non-performing loans decreased to $8.9 million from $9.0 million at March 31, 2006, which represents 0.71 percent of total loans. Quarterly net charge-offs to average loans remained low at 0.03 percent.

Capital

Signature Bank's capital ratios remain strong. The Bank's tier 1 risk-based, total risk-based and leverage capital ratios were approximately 17.44 percent, 17.97 percent and 8.45 percent, respectively, as of June 30, 2006, well in excess of regulatory requirements. The ratios reflect the relatively low risk profile of the balance sheet.

DePaolo concluded: "We are committed to finding bankers who have built strong reputations in the markets they serve and creating a home for them at Signature Bank, either at an existing location or by opening a new office. In fact, to kick off the 2006 third quarter, we named two additional teams that will head two new locations: one on the Upper East Side of Manhattan and the other in Jackson Heights, Queens, which is expected to open in the latter part of the third quarter. We now have 55 Group Directors in place who head 45 teams, operating out of 17 metro-N.Y. area offices. We intend to continue to benefit from the changing face of the banking industry on all fronts and seize the many opportunities available to us."

Conference Call

Signature Bank's management will host a conference call to review results of the 2006 second quarter on Thursday, July 27, 2006, at 10:00 a.m. ET. Participants should dial 800-240-2134 at least ten minutes prior to the start of the call. International callers should dial 303-262-2143.

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 the "investor relations" tab, then select "Company News," followed by "Conference Calls," to access the link to the call. Refer to conference identification number 34814. To listen to a telephone replay of the conference call, please dial 303-590-3000 and enter reservation identification number 11066677. The replay will be available from approximately 12:00 p.m. ET on Thursday, July 27, 2006, through 11:59 p.m. ET on Tuesday, August 1, 2006.

About Signature Bank

Signature Bank, member FDIC, is a New York-based full-service commercial bank with 17 private client offices located in the New York metropolitan area, serving the needs of privately owned businesses, their owners and senior managers through dozens of private client groups. The Bank offers a wide variety of business and personal banking products and services as well as investment, brokerage, asset management and insurance products and services through its subsidiary, Signature Securities Group Corporation, a licensed broker-dealer, investment adviser and member NASD/SIPC.

Signature Bank's 17 offices are located throughout the metropolitan New York area. In Manhattan -- 261 Madison Avenue; 300 Park Avenue; 71 Broadway; 565 Fifth Avenue; 950 Third Avenue; 200 Park Avenue South; and 1020 Madison Avenue. Brooklyn -- 26 Court Street and 84 Broadway. Westchester -- 1C Quaker Ridge Road, New Rochelle; and 360 Hamilton Avenue, White Plains. Long Island -- 1225 Franklin Avenue, Garden City; 279 Sunrise Highway, Rockville Centre; 58 South Service Road, Melville; and 923 Broadway, Woodmere. Queens -- 36-36 33rd Street, Long Island City. Bronx -- 421 Hunts Point Avenue, Hunts Point.

For more information, please visit 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 that are subject to risks and uncertainties. Forward-looking statements include information concerning our future results, interest rates, loan and deposit growth, operations, new private client team hires, new office openings and business strategy. These statements often include words such as "may," "believe," "expect," "anticipate," "intend," "plan," "estimate" or other similar expressions. 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. These factors include but are not limited to: (i) prevailing economic conditions; (ii) changes in interest rates, loan demand, real estate values, and competition, which can materially affect origination levels and gain on sale results in our business, as well as other aspects of our financial performance; (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; and (iv) competition for qualified personnel and desirable office locations. Additional factors are described in our quarterly and annual reports.

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. In light of these risks and uncertainties, you should keep in mind that any forward-looking statement made in this release or elsewhere might not reflect actual results.

SIGNATURE BANK
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)

                                          Three months   Six months
                                             ended         ended
                                            June 30,      June 30,
                                         -----------------------------
(dollars in thousands, except per share
 amounts)                                  2006   2005    2006   2005
----------------------------------------------------------------------
INTEREST AND DIVIDEND INCOME
Loans held for sale                        $917    906   2,164  1,668
Loans, net                               21,279 10,158  39,966 18,663
Securities available-for-sale            30,076 20,743  59,899 39,792
Securities held-to-maturity               3,978  4,141   7,941  8,192
Other short-term investments                621    278     963    586
----------------------------------------------------------------------
   Total interest income                 56,871 36,226 110,933 68,901
----------------------------------------------------------------------
INTEREST EXPENSE
Deposits                                 19,082  9,080  35,866 16,427
Fed funds purchased and securities sold
 under agreements to repurchase           4,667  2,187   9,080  3,323
Federal Home Loan Bank advances           2,767  1,618   6,045  3,731
Other short-term borrowings                 781    306   1,251    329
----------------------------------------------------------------------
   Total interest expense                27,297 13,191  52,242 23,810
----------------------------------------------------------------------
Net interest income before provision for
 loan losses                             29,574 23,035  58,691 45,091
Provision for loan losses                   973    653   1,888  1,278
----------------------------------------------------------------------
Net interest income after provision for
 loan losses                             28,601 22,382  56,803 43,813
----------------------------------------------------------------------
NON-INTEREST INCOME
Commissions                               1,772  1,568   3,415  3,104
Fees and service charges                  2,287  1,915   4,655  3,562
Net gains on sales of securities and
 loans                                      517    555     879  1,117
Other income                                518    566     989  1,103
----------------------------------------------------------------------
   Total non-interest income              5,094  4,604   9,938  8,886
----------------------------------------------------------------------
NON-INTEREST EXPENSE
Salaries and benefits                    12,150 21,492  23,830 30,674
Occupancy and equipment                   2,104  1,712   4,203  3,410
Other general and administrative          5,068  5,439  10,750 10,299
----------------------------------------------------------------------
   Total non-interest expense            19,322 28,643  38,783 44,383
----------------------------------------------------------------------
Income (loss) before income taxes        14,373 (1,657) 27,958  8,316
Income tax expense                        6,134  2,018  11,762  6,264
----------------------------------------------------------------------
Net income (loss)                        $8,239 (3,675) 16,196  2,052
======================================================================
PER COMMON SHARE DATA
Earnings (loss) per share -- basic        $0.28  (0.13)   0.55   0.07
Earnings (loss) per share -- diluted      $0.28  (0.12)   0.54   0.07
SIGNATURE BANK
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION

                                                   June 30,   Dec. 31,
                                                     2006       2005
(dollars in thousands, except per share amounts) (unaudited)
----------------------------------------------------------------------
ASSETS
Cash and due from banks                            $105,357    80,558
Short-term investments                               32,778     5,651
----------------------------------------------------------------------
   Total cash and cash equivalents                  138,135    86,209
----------------------------------------------------------------------
Securities available-for-sale (pledged $1,313,795
 at June 30, 2006, and $946,430 at
 December 31, 2005)                               2,490,527 2,570,799
Securities held-to-maturity (fair market value
 $397,202 at June 30, 2006, and $390,401 at
 December 31, 2005; pledged $173,247 at June 30,
 2006, and $175,730 at December 31, 2005)           410,706   399,501
Federal Home Loan Bank stock                         13,811    14,468
Loans held for sale                                 105,706   138,395
Loans, net                                        1,247,959   995,103
Premises and equipment, net                          20,484    17,785
Accrued interest and dividends receivable            23,913    20,817
Other assets                                        252,042   141,861
----------------------------------------------------------------------
   Total assets                                  $4,703,283 4,384,938
======================================================================
LIABILITIES AND SHAREHOLDERS' EQUITY
Deposits
 Non-interest bearing                             1,371,622 1,277,207
 Interest bearing                                 2,343,171 2,210,526
----------------------------------------------------------------------
   Total deposits                                 3,714,793 3,487,733
----------------------------------------------------------------------
Fed funds purchased and securities sold under
 agreements to repurchase                           360,000   260,000
Federal Home Loan Bank advances                     190,000   220,000
Other short-term borrowings                          36,297    20,000
Accrued expenses and other liabilities               46,467    46,223
----------------------------------------------------------------------
   Total liabilities                              4,347,557 4,033,956
----------------------------------------------------------------------
Shareholders' equity
Preferred stock, par value $.01; 61,000,000
 shares authorized and unissued at
 June 30, 2006, and December 31, 2005                     -         -
Common stock, par value $.01; 64,000,000 shares
 authorized, 29,463,074 shares issued and
 outstanding at June 30, 2006; 64,000,000
 shares authorized, 29,378,397 shares
 issued and outstanding at December 31, 2005            295       294
Additional paid-in capital                          363,023   361,617
Unearned compensation                                     -      (680)
Retained earnings                                    28,999    12,803
Accumulated other comprehensive loss:
 Net unrealized depreciation on securities
  available-for-sale, net of tax effect             (36,591)  (23,052)
----------------------------------------------------------------------
   Total shareholders' equity                       355,726   350,982
----------------------------------------------------------------------
   Total liabilities and shareholders' equity    $4,703,283 4,384,938
======================================================================
SIGNATURE BANK
FINANCIAL SUMMARY, CAPITAL RATIOS, ASSET QUALITY
(unaudited)

                                     Three months       Six months
                                        ended             ended
                                   -----------------------------------
(dollars in thousands, except      June 30, June 30, June 30, June 30,
ratios and per share amounts)        2006     2005     2006     2005
----------------------------------------------------------------------
PER SHARE
Net income (loss) -- basic           $0.28   $(0.13)   $0.55    $0.07
Net income (loss) -- diluted         $0.28   $(0.12)   $0.54    $0.07
Average shares outstanding --
 basic                              29,459   29,353   29,427   29,336
Average shares outstanding --
 diluted                            29,874   29,641   29,840   29,665
Book value                          $12.07   $11.89   $12.07   $11.89

SELECTED FINANCIAL DATA
Return on average total assets        0.74%   (0.41%)   0.73%    0.12%
Return on average shareholders'
 equity                               9.39%   (4.32%)   9.34%    1.22%
Efficiency ratio                     55.73%  103.63%   56.51%   82.23%
Yield on interest-earning assets      5.40%    4.29%    5.31%    4.17%
Cost of deposits and borrowings       2.67%    1.64%    2.59%    1.52%
Net interest margin                   2.81%    2.73%    2.81%    2.73%


                                  June 30, March 31, Dec. 31, June 30,
                                     2006     2006     2005     2005
----------------------------------------------------------------------
CAPITAL RATIOS
Tier one leverage                     8.45%    8.42%    8.67%    9.98%
Tier one risk-based                  17.44%   18.57%   19.55%   23.83%
Total risk-based                     17.97%   19.11%   20.08%   24.37%

ASSET QUALITY
Non-performing loans                $8,891   $9,005   $8,845   $4,708
Allowance for loan losses          $11,696  $10,817  $10,050   $8,105
Allowance for loan losses to non-
 performing loans                   131.55%  120.12%  113.62%  172.15%
Allowance for loan losses to total
 loans                                0.93%    0.98%    1.00%    1.08%
Non-performing loans to total loans   0.71%    0.82%    0.88%    0.62%
Quarterly net charge-offs to
 average loans (annualized)           0.03%    0.06%    0.03%    0.50%
SIGNATURE BANK
NET INTEREST MARGIN ANALYSIS
(unaudited)

                    Three months ended         Three months ended
                      June 30, 2006              June 30, 2005
                 -----------------------------------------------------
                  Average Interest Average  Average Interest Average
(dollars in       Balance Income/  Yield/   Balance Income/  Yield/
thousands)                Expense  Rate             Expense  Rate
----------------------------------------------------------------------
INTEREST-EARNING
 ASSETS
Short-term
 investments      $30,700     398   5.20%   $11,984      90   3.01%
Investment
 securities     2,998,116  34,277   4.57% 2,628,712  25,072   3.82%
Commercial loans
 and commercial
 mortgages        926,785  16,993   7.35%   526,311   7,723   5.89%
Residential
 mortgages         83,024   1,135   5.47%    70,042     929   5.31%
Consumer loans    131,606   3,151   9.60%    69,947   1,506   8.64%
Loans held for
 sale              57,859     917   6.36%    81,477     906   4.46%
----------------------------------------------------------------------
  Total interest-
   earning
   assets       4,228,090  56,871   5.40% 3,388,473  36,226   4.29%
----------------------------------------------------------------------
  Non-interest-
   earning
   assets         240,318                   188,312
----------------------------------------------------------------------
    Total
     assets    $4,468,408                $3,576,785
======================================================================
INTEREST-BEARING
 LIABILITIES
Interest-bearing
 deposits
  NOW and interest-
   bearing
   checking       228,720     821   1.44%   196,081     313   0.64%
  Money market
   accounts     1,808,930  15,536   3.44% 1,469,611   7,154   1.95%
  Certificates
   of deposit     262,133   2,725   4.17%   235,162   1,613   2.75%
  Non-interest-
   bearing
   deposits     1,042,804       -      -    774,905       -      -
----------------------------------------------------------------------
    Total
     deposits   3,342,587  19,082   2.29% 2,675,759   9,080   1.36%
----------------------------------------------------------------------
    Borrowings    752,869   8,215   4.38%   541,839   4,111   3.04%
----------------------------------------------------------------------
    Total
     deposits
     and
     borrowings 4,095,456  27,297   2.67% 3,217,598  13,191   1.64%
----------------------------------------------------------------------
    Other non-
     interest
     bearing
     liabilities
     and
     shareholders'
     equity       372,952                   359,187
----------------------------------------------------------------------
    Total
     liabilities
     and
     shareholders'
     equity     $4,468,408                $3,576,785
======================================================================
OTHER DATA
Net interest
 income/
 interest rate
 spread                    29,574   2.73%            23,035   2.65%
----------------------------------------------------------------------
Net interest
 margin                             2.81%                     2.73%
----------------------------------------------------------------------
Ratio of average
 interest-earning
 assets
 to average
 interest-bearing
 liabilities                      103.24%                   105.31%
======================================================================
SIGNATURE BANK
NET INTEREST MARGIN ANALYSIS
(unaudited)

                      Six months ended           Six months ended
                       June 30, 2006              June 30, 2005
                 -----------------------------------------------------
                  Average Interest Average  Average Interest Average
(dollars in       Balance Income/  Yield/   Balance Income/  Yield/
thousands)                Expense  Rate             Expense  Rate
----------------------------------------------------------------------
INTEREST-EARNING
 ASSETS
Short-term
 investments      $19,367     491   5.11%   $18,487     241   2.63%
Investment
 securities     3,031,035  68,312   4.51% 2,597,950  48,329   3.72%
Commercial loans
 and commercial
 mortgages        883,388  31,544   7.20%   499,176  14,017   5.66%
Residential
 mortgages         78,392   2,098   5.35%    73,266   1,907   5.21%
Consumer loans    131,374   6,324   9.71%    66,472   2,739   8.31%
Loans held for
 sale              67,814   2,164   6.44%    79,777   1,668   4.22%
----------------------------------------------------------------------
  Total interest-
   earning
   assets       4,211,370 110,933   5.31% 3,335,128  68,901   4.17%
----------------------------------------------------------------------
  Non-interest-
   earning
   assets         241,643                   184,621
----------------------------------------------------------------------
    Total
     assets    $4,453,013                $3,519,749
======================================================================
INTEREST-BEARING
 LIABILITIES
Interest-bearing
 deposits
  NOW and
   interest-
   bearing
   checking       221,568   1,504   1.37%   190,688     609   0.64%
  Money market
   accounts     1,763,860  28,518   3.26% 1,473,651  13,131   1.80%
  Certificates
   of deposit     292,145   5,844   4.03%   210,528   2,687   2.57%
  Non-interest-
   bearing
   deposits     1,023,244       -      -    774,612       -      -
----------------------------------------------------------------------
    Total
     deposits   3,300,817  35,866   2.19% 2,649,479  16,427   1.25%
----------------------------------------------------------------------
    Borrowings    773,487  16,376   4.27%   512,110   7,383   2.91%
----------------------------------------------------------------------
    Total
     deposits
     and
     borrowings 4,074,304  52,242   2.59% 3,161,589  23,810   1.52%
----------------------------------------------------------------------
    Other non-
     interest
     bearing
     liabilities
     and
     shareholders'
     equity       378,709                   358,160
----------------------------------------------------------------------
    Total
     liabilities
     and
     shareholders'
     equity    $4,453,013                $3,519,749
======================================================================
OTHER DATA
Net interest
 income/
 interest rate
 spread                    58,691   2.72%            45,091   2.65%
----------------------------------------------------------------------
Net interest
 margin                             2.81%                     2.73%
----------------------------------------------------------------------
Ratio of average
 interest-earning
 assets
 to average
 interest-bearing
 liabilities                      103.36%                   105.49%
======================================================================

Source: Signature Bank