EX-99.1 2 ex99-1.htm EXHIBIT 99.1 PRESS RELEASE ex99-1.htm
 
 
 
195 Church Street
New Haven, CT  06510
www.newalliancebank.com 
 
PRESS RELEASE
 
Contact:  Glenn MacInnes
Executive Vice President and
Chief Financial Officer
NewAlliance Bank
203 789 2639
 
 
NewAlliance Reports Net Income of $13.9 million or $0.14 Per Share;
Excluding Merger Related Charges, Record Net Income of $16.9 million

New Haven, Connecticut, October 26, 2010 – NewAlliance Bancshares, Inc. (NYSE: NAL), the holding company for NewAlliance Bank, today announced net income for the quarter of $13.9 million or $0.14 per diluted share. This compares to $12.6 million or $0.13 per diluted share for the third quarter of 2009. Excluding merger-related expenses, NewAlliance achieved record net income of $16.9 million or $0.17 per diluted share, a 33.9% increase over last year’s third quarter.

“I am very pleased with the sustained revenue momentum we have achieved this year,” stated Peyton R. Patterson, Chairman, President and Chief Executive Officer. “Our consistent focus on expanding our customer relationships and being an active commercial and residential mortgage lender has really paid off. We booked record loan originations, up 31.5% over the first nine months of last year.”

The Board of Directors voted today to pay a quarterly dividend of $0.07 per share to shareholders of record on November 5, 2010 and payable on November 16, 2010. This will be the Company’s 26th consecutive quarterly dividend payment.

Financial Highlights:

·  
Record revenues reported for the quarter of $75.0 million, a 1.8% increase over the linked quarter, and 9.9% over the prior year quarter. Revenues for the first nine months were $219.6 million, an increase of 12.2% over the first nine months of 2009.
 
·  
The net interest margin continued an upward trend to 3.08% compared to 3.02% on a linked quarter basis and prior year quarter of 2.71%.

·  
Record loan originations totaled $597.6 million for the quarter compared to $534.9 million on a linked quarter basis and $358.5 million for the third quarter of 2009.

·  
Commercial loan originations increased 38.3% to $228.6 million from $165.3 million on a linked quarter basis and up over 146.9% from $92.6 million in the prior year quarter.

 
1
 
·  
Total deposits increased slightly from the linked quarter, and were up $164.6 million, or 3.3%, from the prior year quarter. DDA balances were up 9.9% year-over-year.
 
·  
Deposit costs dropped by one basis point to 93 basis points for the month ended September 30, 2010 and by 54 basis points compared to September 30, 2009.

·  
Improved non-performing loan trends have led to a lower provision in the quarter compared to the linked and prior year quarters.

·  
The efficiency ratio for the quarter, excluding merger-related charges, was 61.11% compared to the prior quarter of 60.34% and compared to 63.61% in the prior year quarter.

Net Interest Income

Net interest income before provision for loan losses was a record $60.3 million, a 4.5% increase on a linked quarter basis and a 16.6% increase from the prior year quarter. This is the seventh consecutive quarterly increase in net interest income contributing to the solid revenue momentum.

The net interest margin increased to 3.08%, compared to 3.02% on a linked quarter basis and 2.71% for the prior year quarter.

The cost of deposits was 93 basis points for the month ended September 30, 2010, a decrease of one basis point from the month ended June 30, 2010, and 54 basis points from the month ended September 30, 2009. The cost of borrowings was reduced by 35 basis points on a linked quarter basis. Year-over-year borrowing costs were down by 106 basis points.

The average balance of core deposits was $3.07 billion for the third quarter, just slightly lower than the average for the linked quarter. Year-over-year, however, average core balances increased by $208.8 million, or 7.3%.

Non-Interest Income and Non-Interest Expense

Non-interest income for the quarter decreased $1.3 million, or 8.0%, on a linked quarter basis. The second quarter included a non-recurring gain of approximately $2.6 million from investments in a limited partnership due to an initial public offering.
 
Compared to the prior year quarter, there was a decrease of $1.8 million, or 11.1%, in non-interest income. This was primarily due to $2.0 million of securities gains recorded in the prior year quarter.

Year to date, depositor service charges increased over the first nine months of last year due to overdraft fee income, merchant services income and card fees. For the quarter, however, there was a slight decrease due to lower overdraft fees.

Non-interest expense was $50.2 million, an increase of $6.6 million, or 15.2%, on a linked quarter basis. In the third quarter, non-interest expense included $4.6 million in merger-related expenses and a non-recurring retirement related expense of $1.3 million for a former executive.
 
2
 
Credit Quality

"Our nonperforming loans as a percent of total loans is 1.35% and remains well below industry levels and we have been able to lower our provision,” said Glenn MacInnes, Executive Vice President and Chief Financial Officer. “We remain just as vigilant monitoring credit quality as we always have, and we are still originating many commercial and residential loans in all of our local communities.”

Key Developments:

·  
Total non-performing loans were $68.3 million at quarter end, the same as at the end of the linked quarter.

·  
The allowance for loan losses to total loans decreased to 1.08% from 1.11% on a linked quarter basis.

·  
Net charge-offs decreased by $400,000 to $4.4 million on a linked quarter basis and remained very low relative to peers.

·  
Nonperforming loans to total loans decreased 4 basis points to 1.35% on a linked quarter basis, and nonperforming assets to total assets remained at 0.81% for both periods.

·  
The provision for loan losses totaled $4.0 million, decreasing by $1.5 million on a linked quarter basis and $1.4 million compared to the prior year quarter.

Capital Management

The tangible common equity ratio and total risk-based capital ratio were 11.09% and 20.90%, respectively, and total shareholder’s equity was $1.47 billion at September 30, 2010. The Company’s Tier 1 leverage capital ratio was 11.05% and is more than double the 5% regulatory benchmark that is considered ‘well-capitalized’ for bank holding companies.

At September 30, 2010, NewAlliance Bancshares, the parent company of NewAlliance Bank, had $8.83 billion in assets and operated 88 banking offices in Connecticut and Massachusetts.

NewAlliance Bank provides a full range of consumer and commercial banking products and services, trust services and investment and insurance products and services. The Bank’s website is at www.newalliancebank.com. Shareholders are encouraged to monitor the Investor Relations section of the Company’s website.

NewAlliance will hold a conference call on second quarter earnings at 9:00 a.m. Eastern Time on Wednesday, October 27, 2010. The call is being webcast and will be available at the Investor Relations section of the Company’s website at www.newalliancebank.com. Individuals can dial in to the call at 1-877-317-6789.  The international dial-in number is 1-412-317-6789, or the toll free Canada dial-in is 1-866-605-3852.
 
3
 
A replay of the webcast and call will be available after noon on October 27 through November 10, 2010. To access the replay, dial 1-877-344-7529. For international access, dial 1-412-317-0088. The passcode for either replay number is 445094.

Note: In discussing financial results, management may refer to certain non-GAAP (Generally Accepted Accounting Principles) measures. The Company’s management believes these non-GAAP measurements are essential to a proper understanding of the operating results of the Company’s core business. These non-GAAP measurements are not a substitute for operating results determined in accordance with GAAP nor do they necessarily conform to non-GAAP performance measures that may be presented by other companies. A reconciliation of GAAP and non-GAAP information is included in this release.
 
Statements in this news release, if any, concerning future results, performance, expectations or intentions are forward-looking statements. Actual results, performance or developments may differ materially from forward-looking statements as a result of known or unknown risks, uncertainties and other factors, including those identified from time to time in the Company’s filings with the Securities and Exchange Commission, press releases and other communications. Actual results also may differ based on the Company’s ability to successfully maintain and integrate customers from acquisitions.

The Company intends any forward-looking statements to be covered by the Litigation Reform Act of 1995 and is including this statement for purposes of said safe harbor provisions.  Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date of this news release. Except as required by applicable law or regulation, the Company undertakes no obligation to update any forward-looking statements to reflect events or circumstances that occur after the date as of which such statements are made.

On August 18, 2010, the Company entered into a merger agreement (amended as of September 27, 2010) with First Niagara Financial Group, Inc. (“First Niagara”) and FNFG Merger Sub, Inc. (“Merger Sub”) pursuant to which Merger Sub will be merged with and into the Company and will become a wholly owned subsidiary of First Niagara (the “Merger”). In connection with the Merger, First Niagara has filed with the SEC a Registration Statement on Form S-4 that includes a Proxy Statement of the Company and a Proxy Statement/Prospectus of First Niagara, as well as other relevant documents concerning the Merger. A definitive Proxy Statement will be mailed to stockholders of the Company after the Registration Statement is declared effective. The Registration Statement has not yet become effective. Stockholders are urged to read the definitive Proxy Statement of the Company regarding the Merger when it becomes available and any other relevant documents filed with the SEC, as well as any amendments or supplements to those documents, because they will contain important information. You may obtain a free copy of the Proxy Statement, as well as other filings containing information about the Company at the SEC’s Internet site (http://www.sec.gov). You may also obtain these documents, free of charge, from Company by accessing the Company’s website at www.newalliancebank.com under the tab “Investors” and then under the heading “SEC Filings.” The Company and certain of their directors and executive officers may be deemed to be participants in the solicitation of proxies from the shareholders of the Company in connection with the Merger. Information about the directors and executive officers of the Company is set forth in the proxy statement for the Company’s 2010 annual meeting of stockholders, as filed with the SEC on a Schedule 14A on March 11, 2010. Additional information regarding the interests of those participants and other persons who may be deemed participants in the transaction may be obtained by reading the Proxy Statement regarding the Merger.


 
4
 
  NewAlliance Bancshares, Inc.      
 
Consolidated Statements of Income (Unaudited)
      
                             
               
Three Months Ended
  
Nine Months Ended
               
September 30,
  
September 30,
 
(In thousands, except share data)
  
2010
  
2009
  
2010
  
2009
                             
 
Interest and dividend income
 $
           88,420
 $
           92,268
 $
         262,880
 $
         281,104
 
Interest expense
  
           28,074
  
           40,506
  
           89,152
  
         131,422
                             
   
Net interest income before provision for loan losses
  
           60,346
  
           51,762
  
         173,728
  
         149,682
 
Provision for loan losses
  
            4,000
  
            5,433
  
           14,300
  
           14,533
       
Net interest income after provision for loan losses
  
           56,346
  
           46,329
  
         159,428
  
         135,149
                             
 
Non-interest income
                
   
Depositor service charges
  
            7,210
  
            7,270
  
           21,375
  
           20,175
   
Loan and servicing income
  
               689
  
               322
  
            1,357
  
               498
   
Trust fees
  
            1,590
  
            1,569
  
            4,764
  
            4,219
   
Investment management, brokerage & insurance fees
  
            1,319
  
            1,700
  
            4,135
  
            5,514
   
Bank owned life insurance
  
               822
  
               882
  
            5,131
  
            2,652
                             
   
Other-than-temporary impairment losses on securities
  
                 -
  
                 -
  
               (30)
  
           (2,522)
   
Less:  Portion of loss recognized in other comprehensive income (before taxes)
              (378)
  
                 -
  
              (900)
  
            1,896
   
Net impairment losses on securities recognized in earnings
              (378)
  
                 -
  
              (930)
  
              (626)
                     
   
Net gain on sale of securities
  
               799
  
            2,029
  
            1,549
  
            6,139
   
Net gain on securities
  
               421
  
            2,029
  
               619
  
            5,513
                             
   
Mortgage origination activity & loan sale income
  
            1,150
  
            1,268
  
            2,449
  
            4,768
   
Net gain (loss) on limited partnerships
  
               399
  
               284
  
            3,103
  
              (375)
   
Other
      
            1,018
  
            1,125
  
            2,971
  
            3,039
       
Total non-interest income
  
           14,618
  
           16,449
  
           45,904
  
           46,003
                             
 
Non-interest expense
                
   
Salaries and employee benefits
  
           25,606
  
           22,443
  
           71,809
  
           65,281
   
Occupancy
  
            4,480
  
            4,287
  
           13,195
  
           13,686
   
Furniture and fixtures
  
            1,487
  
            1,419
  
            4,258
  
            4,348
   
Outside services
  
            4,279
  
            4,779
  
           14,146
  
           14,584
   
Advertising, public relations, and sponsorships
  
            1,779
  
            1,869
  
            4,796
  
            3,984
   
Amortization of identifiable intangible assets
  
            1,953
  
            2,122
  
            5,858
  
            6,379
   
FDIC insurance premiums
  
            1,891
  
            1,880
  
            5,646
  
            8,717
   
Merger related charges
  
            4,585
  
                   4
  
            5,089
  
                 27
   
Other
      
            4,186
  
            3,439
  
           11,277
  
           10,023
       
Total non-interest expense
  
           50,246
  
           42,242
  
         136,074
  
         127,029
                             
       
Income before income taxes
  
           20,718
  
           20,536
  
           69,258
  
           54,123
                             
 
Income tax provision
  
            6,802
  
            7,916
  
           22,636
  
           19,805
                             
       
Net income
 $
           13,916
 $
           12,620
 $
           46,622
 $
           34,318
                             
   
Earnings per share
                
     
Basic
  
 $
0.14
 $
0.13
 $
0.47
 $
0.35
     
Diluted
    
0.14
  
0.13
  
0.47
  
0.35
                             
   
Weighted average shares outstanding
                
     
Basic
    
    98,284,937
  
    99,506,517
  
98,693,007
  
99,292,067
     
Diluted
    
    98,486,667
  
    99,569,908
  
98,771,797
  
99,298,399
 
 
 
  NewAlliance Bancshares, Inc.                
 
Consolidated Statements of Income (Unaudited)
                
                                 
             
Three Months Ended
               
September 30,
June 30,
  
March 31,
  
December 31,
September 30,
 
(In thousands, except share data)
  
2010
  
2010
  
2010
  
2009
  
2009
                                 
 
Interest and dividend income
 $
         88,420
 $
          87,061
 $
          87,399
 $
         90,695
 $
         92,268
 
Interest expense
  
         28,074
  
          29,320
  
          31,758
  
         37,169
  
         40,506
                                 
   
Net interest income before provision for loan losses
  
         60,346
  
          57,741
  
          55,641
  
         53,526
  
         51,762
 
Provision for loan losses
  
           4,000
  
            5,500
  
            4,800
  
           3,467
  
           5,433
       
Net interest income after provision for loan losses
  
         56,346
  
          52,241
  
          50,841
  
         50,059
  
         46,329
                                 
 
Non-interest income
                    
   
Depositor service charges
  
           7,210
  
            7,457
  
            6,707
  
           7,176
  
           7,270
   
Loan and servicing income
  
              689
  
              351
  
              317
  
              321
  
              322
   
Trust fees
  
           1,590
  
            1,573
  
            1,602
  
           1,571
  
           1,569
   
Investment management, brokerage & insurance fees
           1,319
  
            1,302
  
            1,514
  
           1,208
  
           1,700
   
Bank owned life insurance
  
              822
  
              847
  
            3,462
  
              896
  
              882
                                 
   
Other-than-temporary impairment losses on securities
                -
  
               (30)
  
                -
  
         (1,741)
  
                -
   
Less:  Portion of loss recognized in other comprehensive income (before taxes)
            (378)
  
             (522)
  
                -
  
              970
  
                -
   
Net impairment losses on securities recognized in earnings
            (378)
  
             (552)
  
                -
  
            (771)
  
                -
   
Net gain on sale of securities
  
              799
  
              750
  
                -
  
           1,175
  
           2,029
   
Net gain on securities
  
              421
  
              198
  
                -
  
              404
  
           2,029
                                 
   
Mortgage origination activity and loan sale income
  
           1,150
  
              571
  
              728
  
              818
  
           1,268
   
Net gain (loss) on limited partnerships
  
              399
  
            2,372
  
              331
  
            (200)
  
              284
   
Other
    
           1,018
  
            1,215
  
              739
  
           1,049
  
           1,125
       
Total non-interest income
  
         14,618
  
          15,886
  
          15,400
  
         13,243
  
         16,449
                                 
 
Non-interest expense
                    
   
Salaries and employee benefits
  
         25,606
  
          23,982
  
          22,221
  
         24,365
  
         22,443
   
Occupancy
  
           4,480
  
            4,094
  
            4,621
  
           4,516
  
           4,287
   
Furniture and fixtures
  
           1,487
  
            1,426
  
            1,345
  
           1,461
  
           1,419
   
Outside services
  
           4,279
  
            4,718
  
            5,149
  
           5,513
  
           4,779
   
Advertising, public relations, and sponsorships
  
           1,779
  
            1,486
  
            1,530
  
           1,680
  
           1,869
   
Amortization of identifiable intangible assets
  
           1,953
  
            1,953
  
            1,953
  
           2,122
  
           2,122
   
FDIC insurance premiums
  
           1,891
  
            1,898
  
            1,857
  
           1,761
  
           1,880
   
Merger related charges
  
           4,585
  
              503
  
                  1
  
               57
  
                 4
   
Other
    
           4,186
  
            3,568
  
            3,523
  
           3,710
  
           3,439
       
Total non-interest expense
  
         50,246
  
          43,628
  
          42,200
  
         45,185
  
         42,242
                                 
       
Income before income taxes
  
         20,718
  
          24,499
  
          24,041
  
         18,117
  
         20,536
                   
 
  
 
  
 
    
 
Income tax provision
  
           6,802
  
            8,226
  
            7,608
  
           5,992
  
           7,916
                   
 
  
 
  
 
    
       
Net income
 $
         13,916
 $
          16,273
 $
          16,433
 $
         12,125
 $
         12,620
                                 
   
Earnings per share
                    
     
Basic
  
 $
0.14
 $
0.16
 $
0.17
 $
0.12
 $
0.13
     
Diluted
    
0.14
  
0.16
  
0.17
  
0.12
  
0.13
                                 
   
Weighted average shares outstanding
                    
     
Basic
    
   98,284,937
  
    98,780,567
  
    99,020,399
  
   99,092,896
  
   99,506,517
     
Diluted
    
   98,486,667
  
    98,859,822
  
    99,057,937
  
   99,254,938
  
   99,569,908
 
 
 
NewAlliance Bancshares, Inc.
                
Consolidated Balance Sheets (Unaudited)
              
                         
                         
       
September 30,
June 30,
  
March 31,
  
December 31,
September 30,
(In thousands)
  
2010
  
2010
  
2010
  
2009
  
2009
Assets
                    
 
Cash and due from banks
$
         122,334
$
           97,693
$
         100,020
$
              96,927
$
           106,539
 
Short-term investments
  
           50,000
  
           20,000
  
           60,000
  
              50,000
  
             40,000
 
Investment securities available for sale
      2,335,362
  
      2,403,317
  
      2,261,915
  
         2,327,855
  
        2,391,260
 
Investment securities held to maturity
         298,495
  
         323,255
  
         270,839
  
            240,766
  
           263,103
 
Loans held for sale
  
           27,229
  
           13,362
  
            9,479
  
              14,659
  
             14,749
 
Loans
                    
   
Residential real estate
  
      2,538,559
  
      2,491,161
  
      2,391,575
  
         2,396,303
  
        2,424,962
   
Commercial real estate
  
      1,319,323
  
      1,261,818
  
      1,271,177
  
         1,233,250
  
        1,222,980
   
Commercial business
  
         513,931
  
         473,329
  
         415,458
  
            411,211
  
           422,814
   
Consumer
  
         696,869
  
         702,063
  
         713,938
  
            721,281
  
           734,951
   
  Total loans
  
      5,068,682
  
      4,928,371
  
      4,792,148
  
         4,762,045
  
        4,805,707
   
Less allowance for loan losses
  
         (54,582)
  
         (54,945)
  
         (54,164)
  
            (52,463)
  
           (51,720)
   
  Total loans, net
  
      5,014,100
  
      4,873,426
  
      4,737,984
  
         4,709,582
  
        4,753,987
 
Federal Home Loan Bank of Boston stock
         120,821
  
         120,821
  
         120,821
  
            120,821
  
           120,821
 
Premises and equipment, net
  
           58,395
  
           58,651
  
           57,387
  
              57,083
  
             57,396
 
Cash surrender value of bank owned life insurance
         135,877
  
         135,054
  
         134,207
  
            140,153
  
           139,257
 
Goodwill
  
         527,167
  
         527,167
  
         527,167
  
            527,167
  
           527,167
 
Identifiable intangible assets
  
           29,501
  
           31,454
  
           33,406
  
              35,359
  
             37,481
 
Other assets
  
         106,994
  
         107,897
  
         187,678
  
            113,941
  
             88,993
 
 
     Total assets
$
      8,826,275
$
      8,712,097
$
      8,500,903
$
         8,434,313
$
        8,540,753
                         
Liabilities
                    
 
Deposits
                    
   
Regular savings
$
      1,705,787
$
      1,798,881
$
      1,807,008
$
         1,817,787
$
        1,841,605
   
Money market
  
         993,569
  
         915,510
  
         934,376
  
            790,453
  
           696,464
   
NOW
  
         398,436
  
         406,069
  
         385,800
  
            400,176
  
           367,627
   
Demand
  
         581,293
  
         568,414
  
         533,841
  
            534,180
  
           528,529
   
Time
  
      1,459,775
  
      1,447,872
  
      1,393,912
  
         1,481,446
  
        1,540,025
   
    Total deposits
  
      5,138,860
  
      5,136,746
  
      5,054,937
  
         5,024,042
  
        4,974,250
 
Borrowings
                    
   
Federal Home Loan Bank of Boston advances
      1,994,811
  
      1,900,561
  
      1,790,960
  
         1,755,533
  
        1,885,389
   
Repurchase agreements
  
         105,606
  
         100,951
  
         102,149
  
            112,095
  
           133,802
   
Junior subordinated debentures
  
           21,135
  
           21,135
  
           21,135
  
              21,135
  
             21,135
   
Other borrowings
  
             1,044
  
            1,085
  
            1,126
  
               1,165
  
              1,204
 
Other liabilities
  
           91,451
  
           87,448
  
           88,584
  
              85,390
  
             97,486
   
  Total liabilities
  
      7,352,907
  
      7,247,926
  
      7,058,891
  
         6,999,360
  
        7,113,266
                         
 
Stockholders' equity
  
      1,473,368
  
      1,464,171
  
      1,442,012
  
         1,434,953
  
        1,427,487
 
 
                      
   
     Total liabilities and stockholders' equity
$
      8,826,275
$
      8,712,097
$
      8,500,903
$
         8,434,313
$
        8,540,753
 
 
 
NewAlliance Bancshares, Inc.
                
Selected Financial Highlights (Unaudited)
                
     
Three Months Ended
       
September 30,
June 30,
  
March 31,
  
December 31,
September 30,
(Dollars in thousands, except per share data)
  
2010
  
2010
  
2010
  
2009
  
2009
  
 
Net interest income before provision for loan losses
  
 $       60,346
  
 $           57,741
  
 $      55,641
  
 $       53,526
  
 $      51,762
  
 
Net income
  
          13,916
  
              16,273
  
         16,433
  
          12,125
  
         12,620
  
 
Shares outstanding (end of period)
  
105,077,475
  
105,079,540
  
105,964,553
  
106,050,464
  
106,638,777
  
 
Weighted average shares outstanding:
                      
   
Basic
  
  98,284,937
  
      98,780,567
  
  99,020,399
  
  99,092,896
  
 99,506,517
  
   
Diluted
  
  98,486,667
  
      98,859,822
  
  99,057,937
  
  99,254,938
  
 99,569,908
  
 
Earnings per share:
                      
   
Basic
  
 $           0.14
  
 $               0.16
  
 $          0.17
  
 $           0.12
  
 $          0.13
  
   
Diluted
  
              0.14
  
                  0.16
  
             0.17
  
              0.12
  
             0.13
  
 
Shareholders' equity (end of period)
  
    1,473,368
  
        1,464,171
  
    1,442,012
  
    1,434,953
  
   1,427,487
  
 
Book value per share (end of period)
  
            14.02
  
                13.93
  
           13.61
  
            13.53
  
           13.39
  
 
Tangible book value per share (end of period)
  
              8.72
  
                  8.62
  
             8.32
  
              8.23
  
             8.09
  
                           
Ratios & Other Information
                      
                           
 
Net interest margin (net interest income as a
                      
 
  % of average earnings assets)
  
3.08
%
3.02
%
2.97
%
2.82
%
2.71
%
 
Net interest spread (yield on earning assets
                      
 
  minus yield on interest-bearing liabilities)
  
2.82
  
2.74
  
2.66
  
2.46
  
2.34
  
 
Average yield on interest-earning assets
  
4.51
  
4.55
  
4.66
  
4.77
  
4.83
  
 
Average rate paid on interest-bearing liabilities
  
1.69
  
1.81
  
2.00
  
2.31
  
2.49
  
                           
 
Return on average assets
  
0.64
  
0.76
  
0.78
  
0.57
  
0.59
  
 
Return on average equity
  
3.79
  
4.49
  
4.57
  
3.39
  
3.57
  
                           
 
At period end:
                      
 
Tier 1 leverage capital ratio
  
11.05
%
11.17
%
11.34
%
11.05
%
10.97
%
                           
 
Asset Quality Information
                      
 
Nonperforming loans
  
 $       68,293
  
 $           68,295
  
 $      64,894
  
 $       50,507
  
 $      49,091
  
 
Total nonperforming assets
  
          71,396
  
              70,943
  
         68,242
  
          54,212
  
         51,793
  
 
Nonperforming loans as a % of total loans
  
1.35
%
1.39
%
1.35
%
1.06
%
1.02
%
 
Nonperforming assets as a % of total assets
  
0.81
  
0.81
  
0.80
  
0.64
  
0.61
  
 
Allowance for loan losses as a % of total loans
  
1.08
  
1.11
  
1.13
  
1.10
  
1.08
  
 
Allowance for loan losses as a % of nonperforming loans
79.92
  
80.45
  
83.47
  
103.87
  
105.36
  
                           
 
Provision for loan losses
  
 $         4,000
  
 $             5,500
  
 $        4,800
  
 $         3,467
  
 $        5,433
  
                           
 
Banking offices
  
88
  
88
  
87
  
87
  
87
  
                           
Non-GAAP Financial Information and Ratios (1)
                      
                           
 
Noninterest income (2)
  
 $       13,798
  
 $           13,316
  
 $      15,069
  
 $       13,039
  
 $      14,136
  
 
Noninterest income as a percent of
                      
 
  operating revenue (2)
  
            18.61
%
                18.74
%
           21.31
%
            19.59
%
           21.45
%
 
Efficiency ratio (3)
  
67.29
  
61.05
  
59.35
  
67.39
  
63.61
  
 
Expenses to average assets (4)
  
2.08
  
2.01
  
2.00
  
2.12
  
1.98
  
 
Return on average tangible assets
  
              0.68
  
                  0.81
  
             0.84
  
              0.61
  
             0.63
  
 
Return on average tangible equity
  
              6.11
  
                  7.31
  
             7.50
  
              5.61
  
             5.95
  
 
Tangible common equity/tangible assets
  
11.09
  
11.11
  
11.10
  
11.08
  
10.82
  
                           
 
Net income, GAAP
  
 $       13,916
  
 $           16,273
  
 $      16,433
          
 
  Tax-exempt life insurance proceeds
  
                  -
  
                      -
  
           2,600
          
 
  Gain on limited partnership, net of tax
  
                  -
  
                1,677
  
                 -
          
 
  Merger related charges, net of tax
  
            2,980
  
                   327
  
                 -
          
 
Proforma net income
  
 $       16,896
  
 $           14,923
  
 $      13,833
          
                           
   
Proforma net income per share - basic
  
 $           0.17
  
 $               0.15
  
 $          0.14
          
   
Proforma net income per share - diluted
  
0.17
  
                  0.15
  
             0.14
          
                           
 
Proforma return on average assets (5)
  
0.77
%
                  0.70
%
             0.66
%
        
 
Proforma return on average equity (5)
  
4.60
  
                  4.12
  
             3.85
          
 
Proforma return on average tangible assets (5)
  
0.82
  
0.74
  
0.70
          
 
Proforma return on average tangible equity (5)
  
7.42
  
6.71
  
6.32
          
 
Proforma efficiency ratio (3) (6)
  
61.11
  
60.34
  
61.61
          
 
(1) Non-GAAP Financial Information and Ratios are not financial measurements required by generally accepted accounting principles, however,
 
     management believes such information is useful to investors in evaluating Company performance.
 
(2) Excludes total net gains or losses on securities and limited partnerships
 
(3) Excludes total net gains or losses on securities and limited partnerships and other real estate owned expenses
 
(4) Excludes severance and merger costs (Where applicable)
 
(5) Excludes tax-exempt life insurance proceeds, gain on limited partnership and merger related costs, net of tax
 
(6) Excludes tax-exempt life insurance proceeds and merger related costs
 
 
 
NewAlliance Bancshares, Inc.                        
Average Balance Sheets (Unaudited)
                      
                                   
         
Three Months Ended
         
September 30, 2010
     September 30, 2009
                 
Average
            
Average
         
Average
      
Yield/
    
Average
      
Yield/
  
(Dollars in thousands)
  
Balance
  
Interest
  
Rate
    
Balance
  
Interest
  
Rate
  
                                   
Interest-earning assets
                            
 
Loans
                            
   
Residential real estate
$
       2,548,169
$
     30,288
  
      4.75
%
$
  2,462,668
$
  31,983
  
     5.19
%
   
Commercial real estate
  
       1,290,757
  
     18,994
  
      5.89
    
  1,212,759
  
  17,791
  
     5.87
  
   
Commercial business
  
          498,386
  
      6,846
  
      5.49
    
     437,842
  
    5,419
  
     4.95
  
   
Consumer
  
          699,089
  
      7,826
  
      4.48
    
     737,405
  
    8,517
  
     4.62
  
   
Total Loans
  
       5,036,401
  
     63,954
  
      5.08
    
  4,850,674
  
  63,710
  
     5.25
  
 
Fed funds sold and other short-term investments
            81,825
  
           46
  
      0.22
    
       87,864
  
         63
  
     0.29
  
 
Federal Home Loan Bank of Boston stock
          120,821
  
             -
  
         -
    
     120,821
  
           -
  
        -
  
 
Investment securities
  
       2,598,638
  
     24,420
  
      3.76
    
  2,579,856
  
  28,495
  
     4.42
  
   
Total interest-earning assets
  
       7,837,685
$
     88,420
  
      4.51
%
  
  7,639,215
$
  92,268
  
     4.83
%
 
Non-interest-earning assets
  
          924,054
            
     899,599
          
     
Total assets
$
       8,761,739
          
$
  8,538,814
          
                                   
Interest-bearing liabilities
                            
 
Deposits
                            
   
Money market
$
          950,315
$
      2,109
  
      0.89
%
$
     621,017
$
    2,419
  
     1.56
%
   
NOW
  
          383,105
  
         210
  
      0.22
    
     366,770
  
       280
  
     0.31
  
   
Savings
  
       1,741,628
  
      2,255
  
      0.52
    
  1,878,458
  
    5,701
  
     1.21
  
   
Time
  
       1,460,894
  
      7,433
  
      2.04
    
  1,512,703
  
  10,530
  
     2.78
  
     
Total interest-bearing deposits
  
       4,535,942
  
     12,007
  
      1.06
    
  4,378,948
  
  18,930
  
     1.73
  
 
Repurchase agreements
  
          102,960
  
         348
  
      1.35
    
     127,307
  
       375
  
     1.18
  
 
FHLB advances and other borrowings
       1,986,248
  
     15,719
  
      3.17
    
  1,988,712
  
  21,201
  
     4.26
  
     
Total interest-bearing liabilities
  
       6,625,150
  
     28,074
  
      1.69
%
  
  6,494,967
  
  40,506
  
     2.49
%
 
Non-interest-bearing demand deposits
          582,066
            
     532,792
          
 
Other non-interest-bearing liabilities
  
            85,407
            
       96,367
          
     
Total liabilities
  
       7,292,623
            
  7,124,126
          
 
Equity
  
       1,469,116
            
  1,414,688
          
     
Total liabilities and equity
$
       8,761,739
          
$
  8,538,814
          
 
Net interest-earning assets
$
       1,212,535
          
$
  1,144,248
          
 
Net interest income
    
$
     60,346
          
$
  51,762
      
 
Interest rate spread
          
      2.82
%
          
     2.34
%
 
Net interest margin (net interest income
                        
   
as a percentage of total interest-earning assets)
      
      3.08
%
          
     2.71
%
 
Ratio of total interest-earning assets
                          
   
to total interest-bearing liabilities
          
  118.30
%
          
 117.62
%
 
 
 
NewAlliance Bancshares, Inc.                        
Average Balance Sheets (Unaudited)
                        
                                   
         
Three Months Ended
  
         
September 30, 2010
    
June 30, 2010
  
                 
Average
            
Average
  
         
Average
      
Yield/
    
Average
      
Yield/
  
(Dollars in thousands)
  
Balance
  
Interest
  
Rate
    
Balance
  
Interest
  
Rate
  
                                   
Interest-earning assets
                            
 
Loans
                            
   
Residential real estate
$
  2,548,169
$
  30,288
  
      4.75
%
$
  2,431,315
$
  29,589
  
      4.87
%
   
Commercial real estate
  
  1,290,757
  
  18,994
  
      5.89
    
  1,269,942
  
  18,662
  
      5.88
  
   
Commercial business
  
     498,386
  
    6,846
  
      5.49
    
    434,904
  
    5,591
  
      5.14
  
   
Consumer
  
     699,089
  
    7,826
  
      4.48
    
    707,878
  
    7,946
  
      4.49
  
   
Total Loans
  
  5,036,401
  
  63,954
  
      5.08
    
  4,844,039
  
  61,788
  
      5.10
  
 
Fed funds sold and other short-term investments
      81,825
  
        46
  
      0.22
    
      73,736
  
        34
  
      0.18
  
 
Federal Home Loan Bank of Boston stock
     120,821
  
           -
  
         -
    
    120,821
      
         -
  
 
Investment securities
  
  2,598,638
  
  24,420
  
      3.76
    
  2,609,442
  
  25,239
  
      3.87
  
   
Total interest-earning assets
  
  7,837,685
$
  88,420
  
      4.51
%
  
  7,648,038
$
  87,061
  
      4.55
%
 
Non-interest-earning assets
  
     924,054
            
    924,626
          
     
Total assets
$
  8,761,739
          
$
  8,572,664
          
                                   
Interest-bearing liabilities
                            
 
Deposits
                            
   
Money market
$
     950,315
$
    2,109
  
      0.89
%
$
    933,663
$
    2,291
  
      0.98
%
   
NOW
  
     383,105
  
      210
  
      0.22
    
    390,424
  
      238
  
      0.24
  
   
Savings
  
  1,741,628
  
    2,255
  
      0.52
    
  1,802,266
  
    2,756
  
      0.61
  
   
Time
  
  1,460,894
  
    7,433
  
      2.04
    
  1,411,178
  
    7,179
  
      2.03
  
     
Total interest-bearing deposits
  
  4,535,942
  
  12,007
  
      1.06
    
  4,537,531
  
  12,464
  
      1.10
  
 
Repurchase agreements
  
     102,960
  
      348
  
      1.35
    
      98,885
  
      342
  
      1.38
  
 
FHLB advances and other borrowings
  1,986,248
  
  15,719
  
      3.17
    
  1,847,531
  
  16,514
  
      3.58
  
     
Total interest-bearing liabilities
  
  6,625,150
  
  28,074
  
      1.69
%
  
  6,483,947
  
  29,320
  
      1.81
%
 
Non-interest-bearing demand deposits
     582,066
            
    559,250
          
 
Other non-interest-bearing liabilities
  
      85,407
            
      79,788
          
     
Total liabilities
  
  7,292,623
            
  7,122,985
          
 
Equity
  
  1,469,116
            
  1,449,679
          
     
Total liabilities and equity
$
  8,761,739
          
$
  8,572,664
          
 
Net interest-earning assets
$
  1,212,535
          
$
  1,164,091
          
 
Net interest income
    
$
  60,346
          
$
  57,741
      
 
Interest rate spread
          
      2.82
%
          
      2.74
%
 
Net interest margin (net interest income
                        
   
as a percentage of total interest-earning assets)
    
      3.08
%
          
      3.02
%
 
Ratio of total interest-earning assets
                            
   
to total interest-bearing liabilities
          
  118.30
%
          
  117.95
%
 
 
 
NewAlliance Bancshares, Inc.                            
Average Balance Sheets (Unaudited)
                            
                                   
         
Nine Months Ended
  
         
September 30, 2010
  
September 30, 2009
  
                 
Average
            
Average
  
         
Average
      
Yield/
    
Average
      
Yield/
  
(Dollars in thousands)
  
Balance
  
Interest
  
Rate
    
Balance
  
Interest
  
Rate
  
                                   
Interest-earning assets
                            
 
Loans
                            
   
Residential real estate
$
  2,456,576
$
    89,561
  
       4.86
%
$
  2,522,403
$
  100,358
  
       5.30
%
   
Commercial real estate
  
  1,271,457
  
    55,909
  
       5.86
    
  1,213,877
  
   52,855
  
       5.81
  
   
Commercial business
  
     449,952
  
    17,631
  
       5.22
    
     443,564
  
   16,658
  
       5.01
  
   
Consumer
  
     707,867
  
    23,908
  
       4.50
    
     739,600
  
   25,821
  
       4.65
  
   
Total Loans
  
  4,885,852
  
   187,009
  
       5.10
    
  4,919,444
  
  195,692
  
       5.30
  
 
Fed funds sold and other short-term investments
      80,437
  
         112
  
       0.19
    
      93,336
  
        342
  
       0.49
  
 
Federal Home Loan Bank of Boston stock
     120,821
  
             -
  
          -
    
     120,821
  
 -
      
 
Investment securities
  
  2,574,568
  
    75,759
  
       3.92
    
  2,456,203
  
   85,070
  
       4.62
  
   
Total interest-earning assets
  
  7,661,678
$
   262,880
  
       4.57
%
  
  7,589,804
$
  281,104
  
       4.94
%
 
Non-interest-earning assets
  
     924,097
            
     889,869
          
     
Total assets
$
  8,585,775
          
$
  8,479,673
          
                                   
Interest-bearing liabilities
                            
 
Deposits
                            
   
Money market
$
     912,554
$
      6,651
  
       0.97
%
$
     515,048
$
     6,500
  
       1.68
%
   
NOW
  
     380,160
  
         710
  
       0.25
    
     360,717
  
        777
  
       0.29
  
   
Savings
  
  1,780,461
  
      8,496
  
       0.64
    
  1,729,690
  
   19,125
  
       1.47
  
   
Time
  
  1,433,546
  
    22,496
  
       2.09
    
  1,617,893
  
   36,646
  
       3.02
  
     
Total interest-bearing deposits
  
  4,506,721
  
    38,353
  
       1.13
    
  4,223,348
  
   63,048
  
       1.99
  
 
Repurchase agreements
  
     104,368
  
      1,038
  
       1.33
    
     142,383
  
     1,302
  
       1.22
  
 
FHLB advances and other borrowings
  1,881,762
  
    49,761
  
       3.53
    
  2,109,595
  
   67,072
  
       4.24
  
     
Total interest-bearing-liabilities
  6,492,851
  
    89,152
  
       1.83
%
  
  6,475,326
  
  131,422
  
       2.71
%
 
Non-interest-bearing demand deposits
     556,865
            
     510,864
          
 
Other non-interest-bearing liabilities
      83,768
            
      93,788
          
     
Total liabilities
  
  7,133,484
            
  7,079,978
          
 
Equity
  
  1,452,291
            
  1,399,695
          
     
Total liabilities and equity
$
  8,585,775
          
$
  8,479,673
          
 
Net interest-earning assets
$
  1,168,827
          
$
  1,114,478
          
 
Net interest income
    
$
   173,728
          
$
  149,682
      
 
Interest rate spread
          
       2.74
%
          
       2.23
%
 
Net interest margin (net interest income
                        
   
as a percentage of total interest-earning assets)
  
       3.02
%
          
       2.63
%
 
Ratio of total interest-earning assets
                          
   
to total interest-bearing liabilities
          
   118.00
%
          
   117.21
%
 
 
 
NewAlliance Bancshares, Inc.                  
Asset Quality (Unaudited)
                  
                           
       
September 30,
June 30,
  
March 31,
  
December 31,
September 30,
(Dollars in thousands)
  
2010
  
2010
  
2010
  
2009
  
2009
  
Nonperforming assets
                      
   
Residential real estate
$
           49,133
$
           46,663
$
           39,873
$
           31,140
$
           26,654
  
   
Commercial real estate
  
           10,951
  
             9,959
  
           13,111
  
             8,595
  
             9,714
  
   
Commercial business
  
             5,667
  
             9,093
  
             9,510
  
             8,497
  
           10,693
  
   
Consumer
  
             2,542
  
             2,580
  
             2,400
  
             2,275
  
             2,030
  
 
Total nonperforming loans
  
           68,293
  
           68,295
  
           64,894
  
           50,507
  
           49,091
  
                           
Other nonperforming assets, net
  
             3,103
  
             2,648
  
             3,348
  
             3,705
  
             2,702
  
                           
Total nonperforming assets
$
           71,396
$
           70,943
$
           68,242
$
           54,212
$
           51,793
  
                           
Allowance for loan losses
$
           54,582
$
           54,945
$
           54,164
$
           52,463
$
           51,720
  
                           
                           
                           
     
 Three Months Ended
       
September 30,
June 30,
  
March 31,
  
December 31,
September 30,
       
2010
  
2010
  
2010
  
2009
  
2009
  
Net loan charge-offs
                      
 
Residential real estate
$
             1,261
$
             1,285
$
             1,049
$
               883
$
               957
  
 
Commercial real estate
  
             1,301
  
             2,076
  
               871
  
               738
  
               864
  
   
Total real estate
  
             2,562
  
             3,361
  
             1,920
  
             1,621
  
             1,821
  
 
Commercial business
  
             1,443
  
             1,183
  
               902
  
               890
  
             2,938
  
 
Consumer
  
               358
  
               175
  
               277
  
               213
  
               456
  
Total net charge-offs
$
             4,363
$
             4,719
$
             3,099
$
             2,724
$
             5,215
  
                           
Provision for loan losses
$
             4,000
$
             5,500
$
             4,800
$
             3,467
$
             5,433
  
                           
                           
     
At or For the Three Months Ended
  
       
September 30,
June 30,
  
March 31,
  
December 31,
September 30,
       
2010
  
2010
  
2010
  
2009
  
2009
  
Ratios
                      
 
Allowance for loan losses to total loans
  
              1.08
%
              1.11
%
              1.13
%
              1.10
%
              1.08
%
 
Allowance for loan losses to nonperforming loans
             79.92
  
             80.45
  
             83.47
  
           103.87
  
           105.36
  
 
Nonperforming loans to total loans
  
              1.35
  
              1.39
  
              1.35
  
              1.06
  
              1.02
  
 
Nonperforming assets to total assets
  
              0.81
  
              0.81
  
              0.80
  
              0.64
  
              0.61
  
 
Net charge-offs to average loans (annualized)
              0.35
  
              0.39
  
              0.26
  
              0.23
  
              0.43