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Actionable news in BOFI: BofI Holding, Inc.,

Bofi Holding, Inc. Announces Record Quarter Net Income, Up SAN DIEGO, CA – (MARKETWIRED) –

The following excerpt is from the company's SEC filing.

April 28, 2016

– BofI Holding, Inc. (NASDAQ: BOFI) (

), parent company of BofI

Federal Bank (the

), today announced financial results for the

fiscal quarter ended

March 31, 2016

. Net income was a record

$35.9 million

, an increase of

over net income of

$21.1 million

for the quarter ended

March 31, 2015

. Earnings attributable to BofI’s common stockholders were

$35.8 million

per diluted share for the

quarter of fiscal

$21.0 million

Adjusted earnings, a non-GAAP measur e, which excludes the after-tax impact of gains and losses associated with our securities portfolio, increased

$36.0 million

compared to

$21.6 million

Quarter Fiscal

Financial Summary:

Three Months Ended

March 31,

(Dollars in thousands, except per share data)

Q3 Fiscal 2016

Q3 Fiscal 2015

% Change

Net interest income



Non-interest income





Adjusted Earnings



Net income attributable to common stockholders



Diluted EPS

See “Use of Non-GAAP Financial Measures”

Per share amounts have been retroactively restated for all prior periods presented to reflect the four-for-one forward split of the Company’s common stock effected in the form of a stock dividend that was distributed on November 17, 2015

For the

nine months

, net income was a record

$89.6 million

$58.3 million

$89.3 million

$58.1 million

. Record earnings for the quarter and for the

were primarily the result of growth in both the Bank’s loan and lease portfolio and its fee income businesses.

“We achieved record quarterly earnings and earnings per share as a result of robust fee income growth, balanced loan growth and solid net interest margins” stated Greg Garrabrants, President and Chief Executive Officer. “Strong growth in fee income from our H&R Block partnership was a catalyst for our best in class return on assets and return on equity. We continue to generate healthy growth in our single family, C&I and warehouse lending businesses while maintaining a strong core net interest margin and sound credit quality. We closed the acquisition of certain assets and operations of Pacific Western Equipment Finance at the end of the third quarter. The addition of an experienced equipment leasing team with a nationwide footprint further diversifies our commercial lending capabilities. With a strong balance sheet, excellent credit quality and capital flexibility, we will continue to invest in new growth initiatives and ongoing infrastructure enhancements that will further improve our customer service and user experience” Mr. Garrabrants concluded.

This quarter ended March 31, 2016 was the Bank’s first income tax preparation season since it entered into its August 2015 long-term agreement with H&R Block, Inc. to offer co-branded financial products to H&R Block customers. The seasonal impact of income tax refunds received by H&R Block customers this quarter caused an expected increase in the Bank’s fee income for the three months ended March 31, 2016 and an

expected temporary increase in assets and deposits included in the balance sheet of the Bank at March 31, 2016. Excluding the H&R Block temporary seasonal growth, consolidated assets and consolidated deposits at March 31, 2016 would have been $7.2 billion and $5.5 billion, respectively.

“The net interest margin would have been 4.02% when excluding the average balances associated with lower yielding excess cash and the average balances and yield earned on the H&R Block related loan products during the quarter, which is consistent with our strong net interest margins reported in previous quarters,” stated Andy Micheletti, Executive Vice President and Chief Financial Officer, who continued. “BofI also had strong balance sheet growth even after excluding the seasonal assets and deposits from the H&R Block agreement. Asset growth excluding the seasonal growth this quarter was 29.4% year over year and 29.5% annualized compared to the last quarter ended December 31, 2015. Similarly, deposit growth this quarter was 25.9% year over year and 23.2% annualized growth compared to the last quarter ended December 31, 2015 after excluding seasonal deposit growth.”

“Also this quarter, management and the Board took additional steps to position our business for the future,” added Mr. Micheletti. “In January, we completed our first rating process and our Bank and holding company each received investment grade debt ratings from Kroll Bond Rating Agency. The debt ratings and the overall strength of BofI’s financial position allowed us to conduct a public offering at the holding company of investment-grade 6.25% subordinated notes totaling $51 million of face amount completed in March. With significant volatility in public equity markets in the first three months of 2016, management elected to issue debt for its capital raising activities rather than issuing common equity as in the past. The proceeds of the notes are expected to be used for general corporate purposes, possible future acquisitions and growth opportunities, possible common stock share repurchases, and to provide new capital to the Bank to support its future growth. Also in March, the Board authorized a program to repurchase up to $100 million of BOFI common stock at our discretion based on our assessment of the stock trading price, general market conditions and other considerations.”

Other Highlights:

Total assets reached

$7,705.6 million

$2,177.1 million

Loan portfolio grew by

$1,393.4 million

Loan originations and purchases for the three months ended

$1,248.5 million


compared to the quarter ended

Deposits grew by

$1,679.3 million

Asset quality remains strong with total non-performing assets of

of total assets and non-performing loans and leases equal to

of total loans and leases at

Return on average common stockholders’ equity was



Tangible book value increased to


per share, up

per share compared to

Income Statement Summary

During the quarter ended

, BofI earned

per diluted share compared to

per diluted share for the quarter ended

. Net interest income increased

$18.9 million

, due to the $1.9 billion growth in average-earning assets.

The loan and lease loss provision was

$2.0 million

$2.9 million

. Non-performing loans as percentage of total loans was 39 basis points at March 31, 2016 compared to 72 basis points at March 31, 2015 and, for fiscal 2016 year to date, the Bank has experienced a net recovery of $0.8 million. As a result of the decreasing charge-off history, the additional loss provisions added for loan originations and for the equipment lease purchase this quarter have been partially reduced by lower loss rates and lower outstanding balances associated with certain older vintage loans causing a decline in the provision year over year.

, non-interest income was

$23.3 million

$8.4 million

. The increase year over year was the result of an increase in banking service fees and other income of

$16.3 million

, primarily due to seasonal H&R Block-branded products and service fee income.

Non-interest expense or operating costs increased

$9.1 million

$29.4 million

$20.3 million

. The increase was mainly a result of an increase in salaries and related expense of

$5.8 million

related to staffing added since

, an increase in data processing and internet expense of

$1.5 million

and an increase of

$1.4 million

in other general and administrative costs, partially to support seasonal H&R Block-branded products and services. The increases in staffing primarily support loan, deposit, data processing and software initiatives.

Balance Sheet Summary

BofI’s total assets increased

$1,881.9 million

, as of

, up from

$5,823.7 million

June 30, 2015

. The loan portfolio increased

$1,106.1 million

on a net basis, primarily from portfolio loan originations and purchases of

$2,814.1 million

less principal repayments and other adjustments of

$1,708.0 million

. Loans held for sale


$0.7 million

. Investment securities

$100.8 million

primarily due to securities purchases. Total liabilities increased by

$1,762.1 million

$7,052.3 million

$5,290.2 million

. The increase in total liabilities resulted primarily from growth in deposits of

$1,596.1 million

. Stockholders’ equity increased by

$119.8 million

$653.3 million

$533.5 million

. The increase was primarily the result of

in net income and sale of common stock of

, net of commissions and fees.

The Bank’s Tier 1 core capital to adjusted average assets ratio was

Conference Call

A conference call and webcast will be held on

Thursday, April 28, 2016

at 4:30 PM Eastern / 1:30 PM Pacific. Analysts and investors may dial in and participate in the question/answer session. To access the call, please dial: 877-407-8293. The conference call will be webcast live and may be accessed at BofI’s website, For those unable to listen to the live broadcast, a replay will be available until Friday, May 27, 2016, at BofI’s website and telephonically by dialing toll-free number 877-660-6853, passcode 13634378.

About BofI Holding, Inc. and BofI Federal Bank

BofI Holding, Inc. is the holding company for BofI Federal Bank, a nationwide bank that provides financing for single and multifamily residential properties, small-to-medium size businesses in target sectors, and selected specialty finance receivables. With approximately

$7.7 billion

in assets, BofI Federal Bank provides consumer and business banking products through its low-cost distribution channels and affinity partners. BofI Holding, Inc.’s common stock is listed on the NASDAQ Global Select Market under the symbol “BOFI” and is a component of the Russell 2000

Index and the S&P SmallCap 600

Index. For more information on BofI Federal Bank, please visit

In addition to the results presented in accordance with GAAP, this report includes non-GAAP financial measures such as adjusted earnings. Adjusted earnings, previously labeled as “core earnings,” exclude realized and unrealized gains and losses associated with our securities portfolios. Excluding these gains and losses provides investors with an understanding of BofI’s core lending and mortgage banking business. Non-GAAP financial measures have inherent limitations, are not required to be uniformly applied and are not audited. Readers should be aware of these limitations and should be cautious as to their use of such measures. Although BofI believes the non-GAAP financial measures disclosed in this report enhance investors’ understanding of its business and performance, these non-GAAP measures should not be considered in isolation, or as a substitute for GAAP basis financial measures. Below is a reconciliation of GAAP net income to adjusted earnings:

Nine Months Ended

(Dollars in thousands)



Realized securities losses (gains)

Unrealized securities losses (gains)

Tax (provision) benefit



Forward-Looking Safe Harbor Statement

This press release contains forward-looking statements that involve risks and uncertainties, including without limitation statements relating to BofI’s financial prospects and other projections of its performance and asset quality, BofI’s ability to grow and increase its business, diversify its lending, the outcome and effects of pending class action litigation recently filed against the Company, and the anticipated timing and financial performance of offerings, initiatives or acquisitions. These forward-looking statements are made on the basis of the views and assumptions of management regarding future events and performance as of the date of this press release. Actual results and the timing of events could differ materially from those expressed or implied in such forward-looking statements as a result of risks and uncertainties, including without limitation changes in interest rates, inflation, government regulation, general economic conditions, conditions in the real estate markets in which we operate and other factors beyond our control. These and other risks and uncertainties detailed in BofI’s periodic reports filed with the Securities and Exchange Commission could cause actual results to differ materially from those expressed or implied in any forward-looking statements. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release. All forward-looking statements are qualified in their entirety by this cautionary statement, and BofI undertakes no obligation to revise or update any forward-looking statements to reflect events or circumstances after the date of this press release.

Investor Relations Contact:

Johnny Lai, CFA

VP, Corporate Development & Investor Relations


The following tables set forth certain selected financial data concerning the periods indicated:



(Unaudited – dollars in thousands)

Selected Balance Sheet Data:




Loans and leases—net of allowance for loan and lease losses




Loans held for sale, at fair value




Loans held for sale, lower of cost or fair value




Allowance for loan and lease losses













Total deposits




Securities sold under agreements to repurchase


Advances from the FHLB




Subordinated notes and debentures


Total stockholders’ equity




Capital Ratios:

Equity to assets at end of period

BofI Holding, Inc:

Tier 1 leverage (core) capital to adjusted average assets

Common equity tier 1 capital (to risk-weighted assets)

Tier 1 capital (to risk-weighted assets)

Total capital (to risk-weighted assets)

BofI Federal Bank:

(Unaudited – dollars in thousands, except per share data)

At or for the Three Months Ended

At or for the Nine Months Ended

Selected Income Statement Data:

Interest and dividend income





Interest expense







Provision for loan and lease losses

Net interest income after provision for loan and lease losses











Income before income tax expense





Income tax expense







Per Share Data:

Net income:

Book value per common share

Tangible book value per common share

Weighted average number of shares outstanding:









Common shares outstanding at end of period



Common shares issued at end of period



Performance Ratios and Other Data:

Loan originations for investment





Loan originations for sale





Loan and lease purchases



Return on average assets

Interest rate spread

Net interest margin

Efficiency ratio

Asset Quality Ratios:

Net annualized charge-offs to average loans and leases

Non-performing loans and leases to total loans and leases

Non-performing assets to total assets

Allowance for loan and lease losses to total loans and leases at end of period

Allowance for loan and lease losses to non-performing loans and leases



Share and per share amounts have been retroactively restated for all prior periods presented to reflect the four-for-one forward split of the Company’s common stock effected in the form of a stock dividend that was distributed on November 17, 2015

Interest rate spread represents the difference between the annualized weighted average yield on interest-earning assets and the annualized weighted average rate paid on interest-bearing liabilities

Net interest margin represents annualized net interest income as a percentage of average interest-earning assets

The above information was disclosed in a filing to the SEC. To see the filing, click here.

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Other recent filings from the company include the following:

Quarterly report [Sections 13 or 15(d)] - April 28, 2016
Bofi Holding, Inc. Issues Statement Regarding Share Price Volatility - April 18, 2016
Bofi Holding, Inc. Announces Acquisition Of Equipment Leases And Operations Of Pacific Western Equipment Finance - April 4, 2016