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EverBank Financial Corp Announces Fourth Quarter and Full Year 2016 Financial Results

JACKSONVILLE, FL, January 27, 2017 - EverBank Financial Corp (NYSE: EVER) announced today its financial results for the fourth quarter and the year ended December 31, 2016.
GAAP net income available to common shareholders was $55.8 million for the fourth quarter 2016, compared to $34.6 million for the third quarter 2016 and $42.6 million for the fourth quarter 2015. GAAP diluted earnings per share were $0.43 for the fourth quarter 2016, compared to $0.27 in the third quarter 2016 and $0.34 in the fourth quarter 2015. Adjusted net income1 available to common shareholders was $44.1 million for the fourth quarter 2016, compared to $51.6 million for the third quarter 2016 and $42.9 million for the fourth quarter 2015. Adjusted diluted earnings per common share1 in the fourth quarter 2016 were $0.34 compared to $0.40 in the third quarter 2016 and $0.34 in the fourth quarter 2015.
For the year ended 2016, GAAP net income available to common shareholders was $134.8 million, compared to $120.4 million for the year ended 2015. GAAP diluted earnings per share were $1.06 in 2016, compared to $0.95 in 2015. Adjusted net income available to common shareholders1 was $176.0 million in 2016, compared to $154.6 million in 2015. Adjusted diluted earnings per common share1 were $1.38 in 2016, compared to $1.22 in 2015.
Fourth Quarter and Full Year 2016 Key Highlights
•
Total assets of $27.8 billion at December 31, 2016, a decrease of 3% compared to the prior quarter and an increase of 5% year over year.
•
Portfolio loans held for investment (HFI) of $23.6 billion at December 31, 2016, a decrease of 2% compared to the prior quarter and an increase of 6% year over year.
•
Total originations of $2.7 billion in the quarter, a decrease of 17% compared to the prior quarter and 16% year over year. Full year 2016 total originations of $11.6 billion, a decrease of 12% year over year.
•
Total deposits of $19.6 billion at December 31, 2016, flat compared to the prior quarter and up 8% year over year.
•
Net interest margin of 2.80% for the quarter, a decrease of 0.01% compared to the prior quarter.
•
GAAP return on average equity (ROE) was 12.3% for the quarter and 7.7% for the full year. Adjusted ROE1 was 9.8% for the quarter and 10.1% for the full year.
•
Tangible common equity per common share1 of $14.31 at December 31, 2016, an increase of 7% year over year.
•
Adjusted non-performing assets to total assets1 were 0.70% at December 31, 2016. Annualized net charge-offs to average total loans and leases held for investment were 0.15% for the quarter.
•
Consolidated common equity Tier 1 capital ratio of 10.5% and bank Tier 1 leverage ratio of 8.0% as of December 31, 2016.
•
On November 9, 2016, the Company’s stockholders voted to approve the Company's acquisition by Teachers Insurance and Annuity Association of America.










 
 
1 
A reconciliation of Non-GAAP financial measures can be found in the financial tables attached hereto.


                                                



Balance Sheet
Total assets were $27.8 billion at December 31, 2016, a decrease of $0.9 billion, or 3%, compared to the prior quarter and an increase of $1.2 billion, or 5%, year over year. The quarter over quarter decrease was driven by a $0.7 billion, or 32%, decrease in loans held for sale and a $0.4 billion, or 2%, decrease in portfolio loans HFI.
Portfolio Loans and Leases HFI
The following table presents total portfolio loans and leases HFI by product type:
($ in millions)
Dec 31,
2016
 
Sep 30,
2016
 
Dec 31,
2015
 
% Change (Q/Q)
 
% Change (Y/Y)
Consumer Banking:
 
 
 
 
 
 
 
 
 
Residential loans
$
6,564

 
$
6,654

 
$
7,502

 
(1
)%
 
(13
)%
Government insured pool buyouts
5,250

 
5,139

 
4,215

 
2
 %
 
25
 %
Total residential mortgages
11,814

 
11,793

 
11,717

 
—
 %
 
1
 %
Home equity and other
1,244

 
1,173

 
502

 
6
 %
 
148
 %
Total Consumer Banking
13,058

 
12,966

 
12,219

 
1
 %
 
7
 %
 
 
 
 
 
 
 
 
 
 
Commercial Banking:
 
 
 
 
 
 
 
 

Commercial real estate and other commercial loans
3,757

 
3,882

 
3,955

 
(3
)%
 
(5
)%
Mortgage warehouse finance
2,593

 
3,077

 
2,373

 
(16
)%
 
9
 %
Lender finance
1,590

 
1,496

 
1,280

 
6
 %
 
24
 %
Commercial and commercial real estate
7,939

 
8,454

 
7,608

 
(6
)%
 
4
 %
Equipment financing receivables
2,560

 
2,512

 
2,401

 
2
 %
 
7
 %
Total Commercial Banking
10,499

 
10,967

 
10,009

 
(4
)%
 
5
 %
 
 
 
 
 
 
 
 
 
 
Total Loans HFI
$
23,557

 
$
23,933

 
$
22,227

 
(2
)%
 
6
 %

Total Consumer Banking loans HFI increased $92 million, or 1%, compared to the prior quarter and increased $0.8 billion, or 7%, year over year, to $13.1 billion. Total residential mortgages remained flat compared to the prior quarter at $11.8 billion. Home equity lines and other increased $71 million, or 6%, compared to the prior quarter to $1.2 billion.
Total Commercial Banking loans and leases HFI decreased $468 million, or 4%, compared to the prior quarter and increased $490 million, or 5%, year over year to $10.5 billion. Equipment financing receivables increased $48 million, or 2%, compared to prior quarter to $2.6 billion, lender finance increased $94 million, or 6%, to $1.6 billion, mortgage warehouse finance decreased $484 million, or 16%, to $2.6 billion, and commercial real estate and other commercial loans decreased $125 million, or 3%, to $3.8 billion.


                                                



Loan and Lease Origination Activities
The following table presents total organic loan and lease origination information by product type:
($ in millions)
Dec 31,
2016
 
Sep 30,
2016
 
Dec 31,
2015
 
% Change (Q/Q)
 
% Change (Y/Y)
Consumer originations


 


 
 
 
 
 
 
Conventional loans
$
1,297

 
$
1,662

 
$
1,007

 
(22
)%
 
29
 %
Prime jumbo loans
766

 
870

 
1,074

 
(12
)%
 
(29
)%
 
2,063

 
2,532

 
2,081

 
(19
)%
 
(1
)%
Commercial originations
 
 
 
 
 
 

 

Commercial & commercial real estate
351

 
444

 
769

 
(21
)%
 
(54
)%
Equipment financing receivables
332

 
329

 
420

 
1
 %
 
(21
)%
 
684

 
774

 
1,189

 
(12
)%
 
(42
)%
Total originations
$
2,746

 
$
3,306

 
$
3,270

 
(17
)%
 
(16
)%
Total originations were $2.7 billion for the fourth quarter of 2016, a decrease of 17% compared to the prior quarter and a decrease of 16% year over year. For the full year 2016, total originations were $11.6 billion, a decrease of 12% year over year. Consumer originations were $2.1 billion for the fourth quarter of 2016, a decrease of 19% compared to the prior quarter and 1% year over year. For the full year 2016, consumer originations were $8.8 billion, a decrease of 7% year over year. Commercial originations were $684 million for the fourth quarter of 2016, a decrease of 12% compared to the prior quarter, and 42% year over year. For the full year 2016, commercial originations were $2.8 billion, a decrease of 23% year over year.
Deposits and Other Funding
The following table presents total deposit balances by account type and segment:
($ in millions)
Dec 31,
2016
 
Sep 30,
2016
 
Dec 31,
2015
 
% Change (Q/Q)
 
% Change (Y/Y)
Noninterest-bearing demand
$
1,751

 
$
2,071

 
$
1,141

 
(15
)%
 
53
 %
Interest-bearing demand
3,924

 
3,585

 
3,709

 
9
 %
 
6
 %
Savings and money market accounts, excluding market-based
6,429

 
6,272

 
6,339

 
3
 %
 
1
 %
Global market-based accounts
657

 
681

 
717

 
(4
)%
 
(8
)%
Time, excluding market-based
6,877

 
7,034

 
6,336

 
(2
)%
 
9
 %
Total deposits
$
19,638

 
$
19,643

 
$
18,242

 
—
 %
 
8
 %
 
 
 
 
 
 
 

 

Consumer deposits
$
15,032

 
$
15,268

 
$
14,054

 
(2
)%
 
7
 %
Commercial deposits
4,606

 
4,375

 
4,188

 
5
 %
 
10
 %
Total deposits
$
19,638

 
$
19,643

 
$
18,242

 
—
 %
 
8
 %
Total deposits were $19.6 billion at December 31, 2016, flat compared to the prior quarter and an increase of $1.4 billion, or 8%, year over year.
Total other borrowings were $5.5 billion at December 31, 2016, a decrease of $981 million, or 15%, compared to the prior quarter and a decrease of $371 million, or 6%, year over year.



                                                



Capital Strength
Total shareholders' equity was $2.0 billion at December 31, 2016, an increase of 6% quarter over quarter and 8% year over year. As of December 31, 2016, our consolidated common equity Tier 1 capital ratio was 10.5% and the bank’s Tier 1 leverage and total risk-based capital ratios were 8.0% and 13.4%, respectively. As a result, the bank is considered "well-capitalized" under all applicable regulatory guidelines.
Credit Quality
Our adjusted non-performing assets1 were 0.70% of total assets at December 31, 2016, compared to 0.69% for the prior quarter and 0.53% at December 31, 2015. Net charge-offs during the fourth quarter of 2016 were $9 million, an increase of $3 million compared to the prior quarter and $5 million year over year. On an annualized basis, net charge-offs were 0.15% of total average loans and leases held for investment, compared to 0.10% for the prior quarter and 0.07% for the fourth quarter of 2015.
Income Statement Highlights
Revenue
Revenue was $264 million for the fourth quarter of 2016, an increase of $31 million, or 13%, from $233 million in the prior quarter. Excluding the change in valuation allowance on our mortgage servicing rights (MSR) and other one-time items, revenue would have been $243 million in the fourth quarter of 2016, a decrease of 13% compared to the prior quarter.
Net Interest Income
Net interest income was $189 million for the fourth quarter of 2016, a decrease of $0.1 million, or less than 1%, compared to the prior quarter. Average interest-earning assets increased $121 million, or less than 1%, compared to the prior quarter. Average interest-bearing liabilities decreased $417 million, or 2%, compared to the prior quarter.
Net interest margin decreased from 2.81% in the prior quarter to 2.80% for the fourth quarter of 2016, driven by a 0.05% increase in the average cost of total interest-bearing liabilities to 1.16% partially offset by a 0.01% increase in the interest-earning asset yield to 3.82%.
Noninterest Income
Noninterest income for the fourth quarter of 2016 was $75 million, an increase of $31 million, or 73%, compared to the prior quarter driven by higher levels of net loan servicing income. Net loan servicing income increased $44 million compared to the prior quarter to $26 million, driven by the change in valuation allowance on our MSR, which included a $21 million recovery in the fourth quarter compared to an impairment of $23 million in the prior quarter. Excluding the impact of the valuation allowance, net loan servicing income would have been $5 million in both the fourth quarter of 2016 and the prior quarter.
Gain on sale of loans was $28 million, a decrease of $15 million, or 35%, compared to the prior quarter, driven primarily by lower agency funding activity.
Noninterest Expense
Noninterest expense for the fourth quarter of 2016 was $152 million, a decrease of $10 million, or 6%, compared to the prior quarter. Salaries, commissions and employee benefits were $89 million, a decrease of $5 million, or 6%, compared to the prior quarter. General and administrative expense was $42 million, a decrease of $4 million, or 8%, compared to the prior quarter.
EverBank's efficiency ratio in the fourth quarter of 2016 was 57%, compared to 69% in the prior quarter. Excluding the impact of MSR valuation allowance recovery or impairment, transaction and other non-recurring expenses, EverBank's adjusted efficiency ratio1 was 62% for the fourth quarter compared to 61% in the prior quarter.

 
 
1 
A reconciliation of Non-GAAP financial measures can be found in the financial tables attached hereto.


                                                




Dividends
On January 26, 2017, the Company's Board of Directors declared a quarterly cash dividend of $0.06 per common share, payable on February 22, 2017, to stockholders of record as of February 13, 2017. Also on January 26, 2017, the Company's Board of Directors declared a quarterly cash dividend of $421.875, payable on April 5, 2017, for each share of 6.75% Series A Non-Cumulative Perpetual Preferred Stock held as of March 21, 2017.
About EverBank Financial Corp
EverBank Financial Corp, through its wholly-owned subsidiary EverBank, provides a diverse range of financial products and services directly to clients nationwide through multiple business channels. Headquartered in Jacksonville, Florida, EverBank has $27.8 billion in assets and $19.6 billion in deposits as of December 31, 2016. With an emphasis on value, innovation and service, EverBank offers a broad selection of banking, lending and investing products to consumers and businesses nationwide. EverBank provides services to clients through the internet, over the phone, through the mail, at its Florida-based financial centers and at other business offices throughout the country. More information on EverBank can be found at https://about.everbank/investors.
Investor Relations
Scott Verlander
904.623.8455
Scott.Verlander@EverBank.com
Media Contact
Michael Cosgrove
904.623.2029
Michael.Cosgrove@EverBank.com



                                                




Forward Looking Statements

This news release contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and such statements are intended to be covered by the safe harbor provided by the same. These statements may address issues that involve significant risks, uncertainties, estimates and assumptions made by management. Words such as “outlook,” “believes,” “expects,” “potential,” “continues,” “may,” “will,” “could,” “should,” “seeks,” “approximately,” “predicts,” “intends,” “plans,” “estimates,” “anticipates” or the negative version of those words or other comparable words are intended to identify forward-looking statements but are not the exclusive means of identifying such statements. These forward-looking statements are not historical facts, and are based on current expectations, estimates and projections about the Company’s asset growth and earnings, industry, management’s beliefs and certain assumptions made by management, many of which, by their nature, are inherently uncertain and beyond the Company’s control. Factors that could cause actual results to differ from those discussed in the forward-looking statements include, but are not limited to: deterioration of general business and economic conditions, including the real estate and financial markets, in the United States and in the geographic regions and communities we serve; risks related to liquidity, including the adequacy of our cash flow from operations and borrowings to meet our short-term liquidity needs; our capital and liquidity requirements (including under regulatory capital standards, such as Basel III capital standards) and our ability to generate or raise capital; changes in interest rates that affect the pricing of our financial products, the demand for our financial services and the valuation of our financial assets and liabilities, mortgage servicing rights and mortgages held for sale; risk of higher loan and lease charge-offs; legislative or regulatory actions affecting or concerning mortgage loan modification, refinancing and foreclosure; risk of individual claims or further fines, penalties, equitable remedies, or other enforcement actions relating to our mortgage related practices; our ability to comply with any supervisory actions to which we are or become subject as a result of examination by our regulators; concentration of our commercial real estate loan portfolio; higher than normal delinquency and default rates affecting our mortgage banking business; our ability to comply with the amended consent order and the terms and conditions of our settlement of the Independent Foreclosure Review, including the associated costs; concentration of mass-affluent clients and jumbo mortgages; the effectiveness of the hedging strategies we use to manage our mortgage pipeline; the effectiveness of our derivatives to manage interest rate risk; delinquencies on our equipment leases and reductions in the resale value of leased equipment; increases in loan repurchase requests and our reserves for loan repurchases; failure to prevent a breach to our Internet-based system and online commerce security; soundness of other financial institutions; changes in currency exchange rates or other political or economic changes in certain foreign countries; the competitive industry and market areas in which we operate; historical growth rate and performance may not be a reliable indicator of future results; loss of key personnel; fraudulent and negligent acts by loan applicants, mortgage brokers, other vendors and our employees; changes in and compliance with laws and regulations that govern our operations; failure to establish and maintain effective internal controls and procedures; effects of changes in existing U.S. government or government-sponsored mortgage programs; changes in laws and regulations that may restrict our ability to originate or increase our risk of liability with respect to certain mortgage loans; risks related to the approval and consummation of anticipated acquisitions and dispositions; risks related to the continuing integration of acquired businesses; changes to generally accepted accounting principles; environmental liabilities with respect to properties that we take title to upon foreclosure; fluctuations in our stock price; the inability of our banking subsidiary to pay dividends; the possibility that the proposed merger (the “Merger”) with Teachers Insurance Annuity Association of America (“TIAA”) does not close when expected or at all because required regulatory or other approvals and conditions to closing are not received or satisfied on a timely basis or at all; the effect of the announcement or pendency of the Merger on our business relationships, operating results, and business generally; and risks that the proposed Merger disrupts our current plans and operations and potential difficulties in our employee retention as a result of the Merger.
For additional factors that could materially affect our financial results, please refer to EverBank Financial Corp’s filings with the Securities and Exchange Commission, including but not limited to, the risks described under the headings “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” The Company undertakes no obligation to revise these statements following the date of this news release, except as required by law.




                                                



EverBank Financial Corp and Subsidiaries
Consolidated Balance Sheets (unaudited)
(Dollars in thousands, except per share data)
 
 
December 31, 2016
 
December 31, 2015
Assets
 
 
 
 
Cash and due from banks
 
$
36,654

 
$
55,300

Interest-bearing deposits in banks
 
754,784

 
527,151

Total cash and cash equivalents
 
791,438

 
582,451

Investment securities:
 
 
 
 
Available for sale, at fair value
 
485,836

 
555,019

Held to maturity (fair value of $90,037 and $105,448 as of December 31, 2016 and 2015, respectively)
 
89,457

 
103,746

Other investments
 
253,018

 
265,431

Total investment securities
 
828,311

 
924,196

Loans held for sale (includes $1,271,893 and $1,307,741 carried at fair value as of December 31, 2016 and 2015, respectively)
 
1,443,263

 
1,509,268

Loans and leases held for investment:
 
 
 
 
Loans and leases held for investment, net of unearned income
 
23,556,977

 
22,227,492

Allowance for loan and lease losses
 
(103,304
)
 
(78,137
)
Total loans and leases held for investment, net
 
23,453,673

 
22,149,355

Mortgage servicing rights (MSR), net
 
273,941

 
335,280

Premises and equipment, net
 
43,594

 
51,599

Other assets
 
1,003,866

 
1,048,877

Total Assets
 
$
27,838,086

 
$
26,601,026

Liabilities
 
 
 
 
Deposits:
 
 
 
 
Noninterest-bearing
 
$
1,750,529

 
$
1,141,357

Interest-bearing
 
17,887,699

 
17,100,685

Total deposits
 
19,638,228

 
18,242,042

Other borrowings
 
5,506,000

 
5,877,000

Trust preferred securities and subordinated notes payable
 
360,278

 
276,170

Accounts payable and accrued liabilities
 
317,248

 
337,493

Total Liabilities
 
25,821,754

 
24,732,705

Shareholders’ Equity
 
 
 
 
Series A 6.75% Non-Cumulative Perpetual Preferred Stock, $0.01 par value (liquidation preference of $25,000 per share; 10,000,000 shares authorized and 6,000 issued and outstanding at December 31, 2016 and 2015)
 
150,000

 
150,000

Common Stock, $0.01 par value (500,000,000 shares authorized at December 31, 2016 and 2015; 127,036,740 and 125,020,843 issued and outstanding at December 31, 2016 and 2015, respectively)
 
1,270

 
1,250

Additional paid-in capital
 
905,573

 
874,806

Retained earnings
 
1,011,011

 
906,278

Accumulated other comprehensive income (loss) (AOCI), net of benefit for income taxes of $32,305 and $39,893 at December 31, 2016 and 2015, respectively
 
(51,522
)
 
(64,013
)
Total Shareholders’ Equity
 
2,016,332

 
1,868,321

Total Liabilities and Shareholders’ Equity
 
$
27,838,086

 
$
26,601,026




                                                



EverBank Financial Corp and Subsidiaries
Consolidated Statements of Income (unaudited)
(Dollars in thousands, except per share data)
 
Three Months Ended
December 31,
 
Year Ended
December 31,
 
2016
 
2015
 
2016
 
2015
Interest Income
 
 
 
 
 
 
 
Interest and fees on loans and leases
$
250,138

 
$
226,567

 
$
966,966

 
$
847,644

Interest and dividends on investment securities
7,597

 
7,807

 
28,685

 
30,796

Other interest income
664

 
258

 
2,013

 
803

Total interest income
258,399

 
234,632

 
997,664

 
879,243

Interest Expense
 
 
 
 
 
 
 
Deposits
41,273

 
35,495

 
158,713

 
127,399

Other borrowings
27,632

 
24,097

 
108,601

 
83,501

Total interest expense
68,905

 
59,592

 
267,314

 
210,900

Net Interest Income
189,494

 
175,040

 
730,350

 
668,343

Provision for loan and lease losses
21,967

 
10,124

 
48,968

 
38,187

Net Interest Income after Provision for Loan and Lease Losses
167,527

 
164,916

 
681,382

 
630,156

Noninterest Income
 
 
 
 
 
 
 
Loan servicing fee income
22,633

 
26,905

 
92,525

 
117,763

Amortization of mortgage servicing rights
(18,129
)
 
(15,085
)
 
(68,586
)
 
(71,150
)
Recovery (impairment) of mortgage servicing rights
21,192

 
89

 
(61,392
)
 
(31,986
)
Net loan servicing income (loss)
25,696

 
11,909

 
(37,453
)
 
14,627

Gain on sale of loans
28,184

 
24,679

 
132,009

 
125,927

Loan production revenue
6,495

 
5,131

 
25,715

 
22,574

Deposit fee income
1,649

 
3,069

 
8,763

 
14,015

Other lease income
4,284

 
4,840

 
15,886

 
14,716

Other
8,502

 
8,222

 
22,145

 
23,521

Total noninterest income
74,810

 
57,850

 
167,065

 
215,380

Noninterest Expense
 
 
 
 
 
 
 
Salaries, commissions and other employee benefits expense
88,736

 
90,456

 
369,350

 
367,580

Equipment expense
15,514

 
15,363

 
63,316

 
62,242

Occupancy expense
5,867

 
7,313

 
25,695

 
27,004

General and administrative expense
41,795

 
39,729

 
160,586

 
181,551

Total noninterest expense
151,912

 
152,861

 
618,947

 
638,377

Income before Income Taxes
90,425

 
69,905

 
229,500

 
207,159

Provision for Income Taxes
32,104

 
24,759

 
84,569

 
76,633

Net Income
$
58,321

 
$
45,146

 
$
144,931

 
$
130,526

Net Income Allocated to Preferred Stock
(2,531
)
 
(2,531
)
 
(10,125
)
 
(10,125
)
Net Income Allocated to Common Shareholders
$
55,790

 
$
42,615

 
$
134,806

 
$
120,401

Net Earnings per Common Share, Basic
$
0.44

 
$
0.34

 
$
1.07

 
$
0.97

Net Earnings per Common Share, Diluted
$
0.43

 
$
0.34

 
$
1.06

 
$
0.95

Dividends Declared Per Common Share
$
0.06

 
$
0.06

 
$
0.24

 
$
0.20





                                                



Non-GAAP Financial Measures
This press release contains financial information and performance measures determined by methods other than in accordance with accounting principles generally accepted in the United States of America (“GAAP”). Adjusted Net Income, Adjusted Earnings Per Share, Adjusted Efficiency Ratio, Adjusted Return on Equity, Tangible Shareholders’ Equity, Tangible Common Shareholders' Equity, Tangible Common Equity Per Common Share, Tangible Assets and Adjusted Non-Performing Asset Ratio are non-GAAP financial measures. The Company’s management uses these measures to evaluate the underlying performance and efficiency of its operations. The Company’s management believes these non-GAAP measures provide meaningful additional information about the operating performance of the Company’s business and facilitate a meaningful comparison of our results in the current period to those in prior periods and future periods because these non-GAAP measures exclude certain items that may not be indicative of our core operating results and business outlook. In addition, the Company’s management believes that certain of these non-GAAP measures represent a consistent benchmark against which to evaluate the Company’s growth, profitability and capital position. These non-GAAP measures are provided to enhance investors’ overall understanding of our current financial performance, and not as a substitute for, the Company’s reported results. Moreover, the manner in which we calculate these measures may differ from that of other companies reporting non-GAAP measures with similar names.
In the tables below, we have provided a reconciliation of, where applicable, the most comparable GAAP financial measures and ratios to the non-GAAP financial measures and ratios used in this press release, or a reconciliation of the non-GAAP calculation of the financial measure for the periods indicated:



                                                



EverBank Financial Corp and Subsidiaries
 
 
 
 
 
 
 
 
 
 
 
Adjusted Net Income
 
 
 
 
 
 
 
 
 
 
 
 
Three Months Ended
(dollars in thousands, except per share data)
 
Dec 31,
2016
 
Sep 30,
2016
 
Jun 30,
2016
 
Mar 31,
2016
 
Dec 31,
2015
Net income
 
$
58,321

 
$
37,131

 
$
21,555

 
$
27,924

 
$
45,146

Gain on repurchase of trust preferred securities, net of tax
 
—

 
—

 
(916
)
 
—

 
—

Transaction expense and non-recurring regulatory related expense, net of tax
 
1,545

 
4,220

 
187

 
(43
)
 
(1,849
)
Increase (decrease) in Bank of Florida non-accretable discount, net of tax
 
22

 
—

 
(201
)
 
(14
)
 
—

MSR impairment (recovery), net of tax
 
(13,140
)
 
14,365

 
22,861

 
13,976

 
(55
)
Restructuring cost, net of tax
 
(95
)
 
(1,589
)
 
(442
)
 
438

 
2,219

Adjusted net income
 
$
46,653

 
$
54,127

 
$
43,044

 
$
42,281

 
$
45,461

Adjusted net income allocated to preferred stock
 
2,531

 
2,532

 
2,531

 
2,531

 
2,531

Adjusted net income allocated to common shareholders
 
$
44,122

 
$
51,595

 
$
40,513

 
$
39,750

 
$
42,930

Adjusted net earnings per common share, basic
 
$
0.35

 
$
0.41

 
$
0.32

 
$
0.32

 
$
0.34

Adjusted net earnings per common share, diluted
 
$
0.34

 
$
0.40

 
$
0.32

 
$
0.32

 
$
0.34

Weighted average common shares outstanding:
 
 
 
 
 
 
 
 
 
 
   (units in thousands)
 
 
 
 
 
 
 
 
 
 
   Basic
 
126,175

 
125,382

 
125,294

 
125,125

 
124,983

   Diluted
 
128,912

 
127,453

 
126,612

 
126,045

 
126,980

 
 
 
 
 
 
 
 
 
 
 
Adjusted Efficiency Ratio
 
 
 
 
 
 
 
 
 
 
 
 
Three Months Ended
(dollars in thousands)
 
Dec 31,
2016
 
Sep 30,
2016
 
Jun 30,
2016
 
Mar 31,
2016
 
Dec 31,
2015
Net interest income
 
$
189,494

 
$
189,635

 
$
177,440

 
$
173,781

 
$
175,040

Noninterest income
 
74,810

 
43,334

 
19,168

 
29,753

 
57,850

Total revenue
 
264,304

 
232,969

 
196,608

 
203,534

 
232,890

Adjustment items (pre-tax):
 
 
 
 
 
 
 
 
 
 
Gain on repurchase of trust preferred securities
 
—

 
—

 
(1,478
)
 
—

 
—

MSR impairment (recovery)
 
(21,192
)
 
23,170

 
36,872

 
22,542

 
(89
)
Restructuring cost
 
(4
)
 
—

 
(129
)
 
—

 
160

Adjusted total revenue
 
$
243,108

 
$
256,139

 
$
231,873

 
$
226,076

 
$
232,961

 
 
 
 
 
 
 
 
 
 
 
Noninterest expense
 
$
151,912

 
$
161,765

 
$
155,840

 
$
149,430

 
$
152,861

Adjustment items (pre-tax):
 
 
 
 
 
 
 
 
 
 
Transaction expense and non-recurring regulatory related expense
 
(2,492
)
 
(6,806
)
 
(302
)
 
69

 
2,981

Restructuring cost
 
149

 
2,563

 
584

 
(706
)
 
(3,419
)
Adjusted noninterest expense
 
$
149,569

 
$
157,522

 
$
156,122

 
$
148,793

 
$
152,423

 
 
 
 
 
 
 
 
 
 
 
GAAP efficiency ratio
 
57
%
 
69
%
 
79
%
 
73
%
 
66
%
Adjusted efficiency ratio
 
62
%
 
61
%
 
67
%
 
66
%
 
65
%


                                                



EverBank Financial Corp and Subsidiaries
 
Regulatory Capital(1) (bank level)
 
 
 
 
 
 
 
 
 
 
(dollars in thousands)
 
Dec 31,
2016
 
Sep 30,
2016
 
Jun 30,
2016
 
Mar 31,
2016
 
Dec 31,
2015
Shareholders’ equity
 
$
2,261,883

 
$
2,161,524

 
$
2,124,090

 
$
2,123,612

 
$
2,050,456

Less:
Goodwill and other intangibles
 
(47,152
)
 
(47,227
)
 
(47,318
)
 
(47,401
)
 
(47,143
)
 
Disallowed servicing asset
 
—

 
—

 
—

 
(8,618
)
 
(17,719
)
Add:
Accumulated losses on securities and cash flow hedges
 
51,018

 
100,140

 
107,834

 
95,611

 
62,887

Tier 1 capital
(A)
2,265,749

 
2,214,437

 
2,184,606

 
2,163,204

 
2,048,481

Add:
Allowance for loan and lease losses
 
104,143

 
90,948

 
84,994

 
84,134

 
78,789

Total regulatory capital
(B)
$
2,369,892

 
$
2,305,385

 
$
2,269,600

 
$
2,247,338

 
$
2,127,270

 
 
 
 
 
 
 
 
 
 
 
Adjusted total assets
(C)
$
28,208,963

 
$
28,189,485

 
$
26,946,525

 
$
26,232,737

 
$
25,281,658

Risk-weighted assets
(D)
17,677,886

 
18,435,220

 
17,998,277

 
17,362,622

 
17,133,084

 
 
 
 
 
 
 
 
 
 
 
Tier 1 leverage ratio
(A)/(C)
8.0
%
 
7.9
%
 
8.1
%
 
8.2
%
 
8.1
%
Tier 1 risk-based capital ratio
(A)/(D)
12.8
%
 
12.0
%
 
12.1
%
 
12.5
%
 
12.0
%
Total risk-based capital ratio
(B)/(D)
13.4
%
 
12.5
%
 
12.6
%
 
12.9
%
 
12.4
%
 
 
 
 
 
 
 
 
 
 
 
 
 
Regulatory Capital(1) (EFC consolidated)
 
 
 
 
 
 
 
 
 
 
(dollars in thousands)
 
Dec 31,
2016
 
Sep 30,
2016
 
Jun 30,
2016
 
Mar 31,
2016
 
Dec 31,
2015
Shareholders’ equity
 
$
2,016,332

 
$
1,895,556

 
$
1,857,359

 
$
1,855,903

 
$
1,868,321

Less:
Preferred stock
 
(150,000
)
 
(150,000
)
 
(150,000
)
 
(150,000
)
 
(150,000
)
 
Goodwill and other intangibles
 
(47,152
)
 
(47,227
)
 
(47,318
)
 
(47,401
)
 
(47,143
)
 
Disallowed servicing asset
 
(6,593
)
 
(3,060
)
 
(16,132
)
 
(33,609
)
 
(30,959
)
Add:
Accumulated losses on securities and cash flow hedges
 
51,522

 
100,833

 
108,733

 
96,789

 
64,013

Common tier 1 capital
(E)
1,864,109

 
1,796,102

 
1,752,642

 
1,721,682

 
1,704,232

Add:
Preferred stock
 
150,000

 
150,000

 
150,000

 
150,000

 
150,000

Add:
Additional tier 1 capital (trust preferred securities)
 
98,750

 
98,750

 
98,750

 
103,750

 
103,750

Tier 1 capital
(F)
2,112,859

 
2,044,852

 
2,001,392

 
1,975,432

 
1,957,982

Add:
Subordinated notes payable
 
261,528

 
261,428

 
261,329

 
261,417

 
172,420

Add:
Allowance for loan and lease losses
 
104,143

 
90,948

 
84,994

 
84,134

 
78,789

Total regulatory capital
(G)
$
2,478,530

 
$
2,397,228

 
$
2,347,715

 
$
2,320,983

 
$
2,209,191

 
 
 
 
 
 
 
 
 
 
 
Adjusted total assets
(H)
$
28,215,972

 
$
28,192,055

 
$
26,917,493

 
$
26,220,573

 
$
25,286,802

Risk-weighted assets
(I)
17,686,099

 
18,448,080

 
17,990,693

 
17,349,099

 
17,131,756

 
 
 
 
 
 
 
 
 
 
 
 
Common equity tier 1 ratio
(E)/(I)
10.5
%
 
9.7
%
 
9.7
%
 
9.9
%
 
9.9
%
Tier 1 leverage ratio
(F)/(H)
7.5
%
 
7.3
%
 
7.4
%
 
7.5
%
 
7.7
%
Tier 1 risk-based capital ratio
(F)/(I)
12.0
%
 
11.1
%
 
11.1
%
 
11.4
%
 
11.4
%
Total risk-based capital ratio
(G)/(I)
14.0
%
 
13.0
%
 
13.0
%
 
13.4
%
 
12.9
%
 
 
 
 
 
 
 
 
 
 
 
 
 




                                                



EverBank Financial Corp and Subsidiaries
 
 
 
 
 
 
 
 
 
 
 
Tangible Equity, Tangible Common Equity, Tangible Common Equity Per Common Share and Tangible Assets
 
 
 
 
 
 
 
 
 
 
(dollars in thousands except share and per share amounts)
Dec 31,
2016
 
Sep 30,
2016
 
Jun 30,
2016
 
Mar 31,
2016
 
Dec 31,
2015
Shareholders’ equity
 
$
2,016,332

 
$
1,895,556

 
$
1,857,359

 
$
1,855,903

 
$
1,868,321

Less:
 
 
 
 
 
 
 
 
 
 
   Goodwill
 
46,859

 
46,859

 
46,859

 
46,859

 
46,859

   Intangible assets
 
996

 
1,176

 
1,355

 
1,535

 
1,772

Tangible equity
 
1,968,477

 
1,847,521

 
1,809,145

 
1,807,509

 
1,819,690

Less:
 
 
 
 
 
 
 
 
 
 
   Perpetual preferred stock
 
150,000

 
150,000

 
150,000

 
150,000

 
150,000

Tangible common equity
 
$
1,818,477

 
$
1,697,521

 
$
1,659,145

 
$
1,657,509

 
$
1,669,690

 
 
 
 
 
 
 
 
 
 
 
Common shares outstanding at period end
 
127,036,740

 
125,437,973

 
125,324,413

 
125,247,099

 
125,020,843

Book value per common share
 
$
14.69

 
$
13.92

 
$
13.62

 
$
13.62

 
$
13.74

Tangible common equity per common share
 
14.31

 
13.53

 
13.24

 
13.23

 
13.36

 
 
 
 
 
 
 
 
 
 
 
Total assets
 
$
27,838,086

 
$
28,703,045

 
$
27,354,310

 
$
26,641,399

 
$
26,601,026

Less:
 
 
 
 
 
 
 
 
 
 
   Goodwill
 
46,859

 
46,859

 
46,859

 
46,859

 
46,859

   Intangible assets
 
996

 
1,176

 
1,355

 
1,535

 
1,772

Tangible assets
 
$
27,790,231

 
$
28,655,010

 
$
27,306,096

 
$
26,593,005

 
$
26,552,395

 
 
 
 
 
 
 
 
 
 
 
Non-Performing Assets(1)
 
 
 
 
 
 
 
 
 
 
(dollars in thousands)
 
Dec 31,
2016
 
Sep 30,
2016
 
Jun 30,
2016
 
Mar 31,
2016
 
Dec 31,
2015
Non-accrual loans and leases:
 
 
 
 
 
 
 
 
 
 
Consumer Banking:
 
 
 
 
 
 
 
 
 
 
Residential mortgages
 
$
32,405

 
$
33,607

 
$
27,580

 
$
28,644

 
$
32,218

Home equity lines and other
 
7,083

 
6,741

 
6,678

 
6,151

 
3,339

Commercial Banking:
 
 
 
 
 
 
 
 
 
 
Commercial and commercial real estate
 
102,255

 
106,790

 
65,962

 
66,945

 
71,913

Equipment financing receivables
 
41,141

 
37,677

 
28,833

 
26,676

 
17,407

Total non-accrual loans and leases
 
182,884

 
184,815

 
129,053

 
128,416

 
124,877

Total non-performing loans (NPL)
 
182,884

 
184,815

 
129,053

 
128,416

 
124,877

Other real estate owned (OREO)
 
11,390

 
11,866

 
13,477

 
14,072

 
17,253

Total non-performing assets (NPA)
 
194,274

 
196,681

 
142,530

 
142,488

 
142,130

Troubled debt restructurings (TDR) less than 90 days past due
 
14,118

 
14,865

 
14,760

 
15,814

 
16,425

Total NPA and TDR(1)
 
$
208,392

 
$
211,546

 
$
157,290

 
$
158,302

 
$
158,555

 
 
 
 
 
 
 
 
 
 
 
Total NPA and TDR
 
$
208,392

 
$
211,546

 
$
157,290

 
$
158,302

 
$
158,555

Government insured 90 days or more past due still accruing
 
3,725,159

 
3,706,213

 
3,211,913

 
3,255,744

 
3,199,978

Loans accounted for under ASC 310-30:
 
 
 
 
 
 
 
 
 
 
90 days or more past due
 
3,437

 
3,823

 
4,130

 
4,858

 
5,148

Total regulatory NPA and TDR
 
$
3,936,988

 
$
3,921,582

 
$
3,373,333

 
$
3,418,904

 
$
3,363,681

Adjusted credit quality ratios excluding government insured loans and loans accounted for under ASC 310-30: (1)
 
 
 
 
 
 
 
 
 
 
NPL to total loans
 
0.73
%
 
0.71
%
 
0.52
%
 
0.54
%
 
0.53
%
NPA to total assets
 
0.70
%
 
0.69
%
 
0.52
%
 
0.53
%
 
0.53
%
NPA and TDR to total assets
 
0.75
%
 
0.74
%
 
0.58
%
 
0.59
%
 
0.60
%
Credit quality ratios including government insured loans and loans accounted for under ASC 310-30:
 
 
 
 
 
 
 
 
 
 
NPL to total loans
 
15.71
%
 
15.01
%
 
13.59
%
 
14.23
%
 
14.08
%
NPA to total assets
 
14.09
%
 
13.61
%
 
12.28
%
 
12.77
%
 
12.58
%
NPA and TDR to total assets
 
14.14
%
 
13.66
%
 
12.33
%
 
12.83
%
 
12.64
%
 
(1) 
We define non-performing assets, or NPA, as non-accrual loans, accruing loans past due 90 days or more and foreclosed property. Our NPA calculation excludes government insured pool buyout loans for which payment is insured by the government. We also exclude loans and foreclosed property accounted for under ASC 310-30 because we expect to fully collect the carrying value of such loans and foreclosed property.