-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, GCyZv1+TlxrhnEIlFkh09tPW1sEwn5cbhoJ2YGgLC+8YO+KJM4CjdTMZP38xje5E 06C4EpjpCtGTPYIhdUOr/w== 0000899078-04-000309.txt : 20040504 0000899078-04-000309.hdr.sgml : 20040504 20040504101253 ACCESSION NUMBER: 0000899078-04-000309 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20040503 ITEM INFORMATION: ITEM INFORMATION: Other events ITEM INFORMATION: Financial statements and exhibits FILED AS OF DATE: 20040504 FILER: COMPANY DATA: COMPANY CONFORMED NAME: MATRIX BANCORP INC CENTRAL INDEX KEY: 0000944725 STANDARD INDUSTRIAL CLASSIFICATION: MORTGAGE BANKERS & LOAN CORRESPONDENTS [6162] IRS NUMBER: 841233716 STATE OF INCORPORATION: CO FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-21231 FILM NUMBER: 04775652 MAIL ADDRESS: STREET 1: 700 17TH STREET STREET 2: SUITE 2100 CITY: DENVER STATE: CO ZIP: 80202 FORMER COMPANY: FORMER CONFORMED NAME: MATRIX CAPITAL CORP /CO/ DATE OF NAME CHANGE: 19960711 8-K 1 may32004-8k.txt SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 _________________________ FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report (or Date of Earliest Event Reported): May 1, 2004 MATRIX BANCORP, INC. - -------------------------------------------------------------------------------- (Exact name of registrant as specified in its charter) Colorado 0-21231 84-1233716 (State or other jurisdiction of (Commission File Number) (IRS Employer incorporation or organization) Identification No.) 700 Seventeenth Street, Suite 2100 80202 Denver, Colorado - -------------------------------------------------------------------------------- (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code (303) 595-9898. ITEM 5. OTHER EVENTS AND REGULATION FD DISCLOSURE. On May 3, 2004, Matrix Bancorp, Inc. (the "Company") announced the closing of the sale of two bank branches located in Las Cruces, New Mexico by its subsidiary, Matrix Capital Bank. The branches were sold to FirstBank, a subsidiary of Access Anytime BanCorp, Inc., and included approximately $78.5 million of deposits and $22.7 million of loans, as well as the real estate and leases associated with the branches. The Company received regulatory approval for the sale on April 7, 2004 and the transaction closed on May 1, 2004. A copy of the press release is attached hereto as Exhibit 99.1. ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS. (c) Exhibits 99.1 Press Release, dated May 3, 2004, announcing financial results for the quarter ended March 31, 2004 and the closing of the sale of Matrix Capital Bank branches in New Mexico. ITEM 12. RESULTS OF OPERATIONS AND FINANCIAL CONDITION. The information in this Item 12 and in the accompanying exhibit is being furnished and shall not be deemed "filed" for purposes of Section 18 of the Securities and Exchange Act of 1934, as amended (the "Exchange Act"), or incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing. On May 3, 2004, Matrix Bancorp, Inc. issued a press release announcing financial results for the quarter ended March 31, 2004. A copy of this press release is attached hereto as Exhibit 99.1. Forward-Looking Statements Certain statements contained in this Form 8-K that are not historical facts, including, but not limited to, statements that can be identified by the use of forward-looking terminology such as "may," "will," "expect," "anticipate," "predict," "plan," "estimate" or "continue" or the negative thereof or other variations thereon or comparable terminology are forward-looking statements, within the meaning of the Private Securities Litigation Reform Act of 1995, and involve a number of risks and uncertainties. The actual results of future events described in such forward-looking statements in this report could differ materially from those stated in such forward-looking statements. Among the factors that could cause actual results to differ materially are: third party claims or actions in relation to the ongoing or future bankruptcies filed by clients or customers; interest rate fluctuations; level of delinquencies; defaults and prepayments; general economic conditions; the occurrence of acts of terrorism, such as the events of September 11, 2001, or acts of war; 2 competition; government regulation; possible future litigation; the actions or inactions of third parties; and other risks set forth in our periodic reports, filings and other public statements, including the Company's current report on Form 8-K filed with the Securities and Exchange Commission on March 14, 2001. Readers should not place undue expectations on any forward-looking statements. We are not promising to make any public announcement when we consider forward-looking statements in this document to be no longer accurate, whether a result of new information, what actually happens in the future or for any other reason. 3 SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. Dated: May 3, 2004 MATRIX BANCORP, INC. By: /s/ Allen McConnell ----------------------------------- Name: Allen McConnell ---------------------------------- Title: Senior Vice President --------------------------------- 4 EXHIBIT INDEX Exhibit No. Description - ----------- ----------- 99.1 Press Release, dated May 3, 2004, announcing financial results for the quarter ended March 31, 2004 and the closing of the sale of Matrix Capital Bank branches in New Mexico. 5 EX-99.1 2 ex99-1.txt MATRIX BANCORP For more information, please contact: David W. Kloos Chief Financial Officer (303) 595-9898 MTXC NASDAQ LISTED MATRIX BANCORP ANNOUNCES FIRST QUARTER EARNINGS AND THE CLOSING OF THE SALE OF MATRIX CAPITAL BANK BRANCHES IN LAS CRUCES May 3, 2004 Denver, Colorado -- Matrix Bancorp, Inc. (NASDAQ: MTXC) (the "Company") today reported net income of $1.3 million for the quarter ended March 31, 2004, or $0.20 per basic and diluted share, as compared to $1.9 million, or $0.29 per diluted share, for the quarter ended March 31, 2003. The net income for the quarter ended March 31, 2004 consists of income from continuing operations of $1.2 million, or $0.18 per basic and diluted share, and income from discontinued operations of $140 thousand, or $0.02 per basic and diluted share. The net income for the quarter ended March 31, 2003 consisted of a loss from continuing operations of $(340) thousand, or $(0.05) per basic and diluted share, and income from discontinued operations of $2.2 million, or $0.35 per basic share and $0.34 per diluted share. The discontinued operations reflect the results of the wholesale production platform at Matrix Financial Services Corporation that was sold in September of 2003. The earnings from discontinued operations in the current quarter reflect a premium payment the Company earned which ceased effective February 2004, pursuant to the terms of the sale. The Company's assets totaled $1.75 billion on March 31, 2004, as compared to $1.72 billion at December 31, 2003. The consistency overall is despite changes in various categories of assets and liabilities. Loans receivable decreased $63.0 million, as compared to December 31, 2003, to $1.28 billion at March 31, 2004, primarily due to the pooling of Small Business Administration ("SBA") loans into securities during the quarter. Securities available for sale increased $80.8 million, as compared to December 31, 2003, to $233.3 million at March 31, 2004. This increase occurred due to the acquisitions of mortgage backed securities ("MBS") including collateralized mortgage obligations, and creation of SBA pooled securities at Matrix Bank. Deposits, including custodial escrow balances and brokered certificates of deposit, decreased $15.6 million as compared to December 31, 2003, to $1.04 billion at March 31, 2004 as maturing brokered deposits were not renewed. The decrease in deposits was offset by increases in the Company's borrowings from FHLBank of $40.0 million, to $498.2 million at March 31, 2004. D. Mark Spencer, President and Co-CEO, commented, "The quarterly results were positive for the Company. By focusing on our core competencies, we have seen progress in our bottom line results due to the steps taken in our initiatives to focus on our banking operations, control costs and seek sustained growth in our fee based service business lines, primarily at Matrix Asset Management and Matrix Bancorp Trading, and in our joint venture investment, Matrix Settlement & Clearance Services." Mr. Spencer continued, "We have also made progress in implementing our strategic plan. We are pleased to announce today the closing of the sale of Matrix Capital Bank's two retail branches in Las Cruces, New Mexico (originally announced on January 30, 2004). The sale received regulatory approval on April 7, 2004 and closed May 1, 2004. The sale included approximately $78.5 million of deposits and $22.7 million of loans, as well as the real estate and leases associated with the branches. The sale will allow the Company to reduce costs associated with the operations of the retail branch locations, and allow the Company to focus on pursuing additional institutional depository relationships. The sale is not anticipated to significantly impact the operations or liquidity of Matrix Capital Bank or the Company. For more information, please refer to the definitive Branch Purchase and Deposit Assumption Agreement, which was included as exhibit to our Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 12, 2004." Richard V. Schmitz, Chairman of the Board and Co-CEO of the Company added, "Interest rates remained consistent throughout the quarter, near the record lows established in 2003. As a result, we continued to see high levels of amortization on our mortgage servicing rights for the first quarter of 2004, however, these levels were lower than levels experienced in the first quarter of 2003. Additionally, we recorded a $1.2 million impairment provision against the mortgage servicing rights during the quarter ended March 31, 2004, also due to the impact of the low interest rate environment. The financial impact of the impairment provision was substantially offset by hedging gain recognized and recorded in other income." Financial Highlights Net interest income before provision for loan and valuation losses totaled $10.3 million for the quarter ended March 31, 2004 as compared to $10.7 million for the quarter ended March 31, 2003. The Company's net interest margin decreased to 2.70% for the quarter ended March 31, 2004 as compared to 2.93% for the quarter ended March 31, 2003. The decrease in net interest income and in the net interest margin can be attributed primarily to a decrease in the average rate earned on average interest-earning assets of 66 basis points to 4.64% for the quarter ended March 31, 2004, as compared to 5.30% for the quarter ended March 31, 2003; however, there was an increase in the average balance of interest-earning assets of $68.0 million to $1.54 billion at March 31, 2004, which reduces the financial impact of the decrease in the rate earned. The effects of the decrease in average rate earned was also partially offset by a decrease in the yield on interest-bearing liabilities to 2.20% for the quarter ended March 31, 2004 as compared to 2.73% for the quarter ended March 31, 2003; however, the average balance of interest-bearing liabilities increased by $85.9 million to $1.40 billion at March 31, 2004, which reduces the financial benefit of the decrease in the yield paid. Both the decrease in the yield on interest-earning assets and the cost of the interest-bearing liabilities are attributable to the continued low interest rate environment. The provision for loan and valuation losses was $1.3 million for the first quarter of 2004 as compared to $700 thousand for the first quarter of 2003. The increase in the provision was due to impairment on one commercial real estate loan at Matrix Capital Bank and additional reserves recorded as a result of increases in historical loss factors related to the Company's homogeneous residential loan portfolio at Matrix Financial. Noninterest income was $17.4 million for the first quarter of 2004 as compared to $17.8 million for the first quarter of 2003. The consistency overall reflects an increase of $600 thousand in brokerage income and $1.0 million in real estate disposition services. The increases were offset by decreases in loan administration of $1.6 million and gain on sale of loans and securities of $1.4 million. The decrease in loan administration is due the significant decrease in the size of the servicing portfolio to $2.91 billion at March 31, 2004 as compared to $4.38 billion at March 31, 2003. Gains on sale of loans and securities is dependent on market conditions and the timing of sales in the marketplace primarily on loans purchased and resold from our servicing portfolio and SBA loan portfolio. Noninterest expense for the first quarter of 2004 was $25.1 million as compared to $28.8 million for the first quarter of 2003. The largest decrease occurred in the level of amortization of mortgage servicing rights, which decreased $4.2 million due to an overall decrease in the outstanding balance of our mortgage servicing rights asset as compared to March 31, 2003, despite prepayment speeds that remained high at 27.4% for the quarter ended March 31, 2004 as compared to 31.6% for the quarter ended March 31, 2003. The impact of the decrease in amortization of mortgage servicing rights was offset by a charge of $1.2 million impairment on mortgage servicing rights, which is also due to the low interest rate environment's impact on the value of our mortgage servicing asset. Forward-Looking Statements Certain statements contained in this press release that are not historical facts, including, but not limited to, statements that can be identified by the use of forward-looking terminology such as "may," "expect," "anticipate," "predict," "believe," "plan," "estimate" or "continue" or the negative thereof or other variations thereon or comparable terminology, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, and involve a number of risks and uncertainties. The actual results of the future events described in such forward-looking statements in this press release could differ materially from those stated in such forward-looking statements. Among the factors that could cause actual results to differ materially are: third party claims or actions in relation to the ongoing or future bankruptcies of the Company's customers; interest rate fluctuations; level of delinquencies; defaults and prepayments; general economic conditions; competition; government regulation; possible future litigation; the actions or inactions of third parties, and actions or inactions of those that are parties to the existing or future bankruptcies of the Company's customers or litigation related thereto; unanticipated developments in connection with the bankruptcy actions or litigation described above, including judicial variation from existing legal precedent and the decision by one or more parties to appeal decisions rendered; the risks and uncertainties discussed elsewhere in the annual report and in the Company's current report on Form 8-K, filed with the Securities and Exchange Commission on March 14, 2001; and the uncertainties set forth from time to time in the Company's periodic reports, filings and other public statements. MATRIX BANCORP, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (Dollars in thousands, except share information)
March 31, December 31, 2004 2003 ----------------- ----------------- (Unaudited) ASSETS Cash and cash equivalents $ 54,625 $ 32,538 Interest-earning deposits and federal funds sold 6,929 1,972 Investment securities 233,315 152,508 Loans held for sale, net 934,300 999,454 Loans held for investment, net 346,980 344,802 Mortgage servicing rights, net 34,559 39,744 Other receivables 37,181 43,884 FHLBank stock, at cost 29,908 30,682 Foreclosed real estate 8,372 8,538 Premises and equipment, net 24,378 24,981 Bank owned life insurance 20,870 20,613 Other assets, net 22,406 24,208 ----------------- ----------------- Total assets $ 1,753,823 $ 1,723,924 ================= ================= LIABILITIES AND SHAREHOLDERS' EQUITY Liabilities: Deposits $ 948,690 $ 974,059 Custodial escrow balances 95,248 85,466 FHLBank borrowings 498,183 458,204 Borrowed money 56,869 47,970 Junior subordinated debentures owed to unconsolidated subsidiary trusts 66,525 66,525 Other liabilities 14,138 18,508 Income taxes payable and deferred income tax liability 2,901 3,508 ----------------- ----------------- Total liabilities 1,682,554 1,654,240 Shareholders' equity: Common stock, $0.0001 par value 1 1 Additional paid-in capital 20,615 20,615 Retained earnings 50,161 48,859 Accumulated other comprehensive income 492 209 ----------------- ----------------- Total shareholders' equity 71,269 69,684 ----------------- ----------------- Total liabilities and shareholders' equity $ 1,753,823 1,723,924 ================= =================
MATRIX BANCORP, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Dollars in thousands, except share information)
Quarter Ended March 31, 2004 2003 ----------------- ----------------- (Unaudited) Interest and dividend income: Loans and securities $ 17,597 $ 19,168 Interest-earning deposits 229 276 ----------------- ----------------- Total interest and dividend income 17,826 19,444 Interest expense: Deposits 2,660 4,023 Borrowed money and junior subordinated debentures 4,817 4,684 ----------------- ----------------- Total interest expense 7,477 8,707 Net interest income before provision for loan and valuation losses 10,349 10,737 Provision for loan and valuation losses 1,299 695 ----------------- ----------------- Net interest income after provision for loan and valuation losses 9,050 10,042 Noninterest income: Loan administration 4,668 6,269 Brokerage 2,952 2,340 Trust services 1,951 1,613 Real estate disposition services 2,389 1,364 Gain on sale of loans and securities 2,084 3,446 School services 671 616 Other 2,695 2,177 ----------------- ----------------- Total noninterest income 17,410 17,825 Noninterest expense: Compensation and employee benefits 8,960 9,066 Amortization of mortgage servicing rights 4,671 8,899 Occupancy and equipment 1,559 1,518 Postage and communication 587 707 Professional fees 737 975 Data processing 623 659 Impairment on mortgage servicing rights 1,156 - Other general and administrative 6,842 6,927 ----------------- ----------------- Total noninterest expense 25,135 28,751 ----------------- ----------------- Income (loss) from continuing operations before income taxes 1,325 (884) Income tax provision (benefit) 160 (544) ----------------- ----------------- Income (loss) from continuing operations 1,165 (340) ----------------- ----------------- Discontinued operations: Income from discontinued operations, net of income tax provision of $89 and $1,457, respectively 137 2,252 ----------------- ----------------- Net income $ 1,302 $ 1,912 ================= ================= Quarter Ended March 31, 2004 2003 ----------------- ----------------- Income (loss) from continuing operations per share - basic $ 0.18 $ (0.05) ----------------- ----------------- Income (loss) from continuing operations per share - assuming dilution $ 0.18 $ (0.05) ----------------- ----------------- Income from discontinued operations per share - basic $ 0.02 $ 0.35 ----------------- ----------------- Income from discontinued operations per share - assuming dilution $ 0.02 $ 0.34 ----------------- ----------------- Net income per share - basic $ 0.20 $ 0.30 ================= ================= Net income per share - assuming dilution $ 0.20 $ 0.29 ================= =================
MATRIX BANCORP, INC. AND SUBSIDIARIES OPERATING RATIOS AND OTHER SELECTED DATA (Dollars in thousands except share information)
Quarter Ended March 31, 2004 2003 ----------------- ------------------ (Unaudited) Weighted average shares - basic 6,518,981 6,490,776 Weighted average shares - assuming dilution 6,582,303 6,531,406 Number of shares outstanding at end of period 6,518,981 6,491,043 Average Balances Loans receivable $ 1,368,959 $ 1,392,723 Interest-earning assets 1,535,897 1,467,946 Total assets 1,739,442 1,681,274 Interest-bearing deposits 792,692 809,584 FHLBank and other borrowings 566,850 464,045 Interest-bearing liabilities 1,359,542 1,273,629 Shareholders' equity 70,091 67,763 Operating Ratios & Other Selected Data (1) Return on average equity 7.43 % 11.29 % Net interest margin (2) 2.70 % 2.93 % Net interest margin - Matrix Capital Bank(2) 3.04 % 3.01 % Operating efficiency ratio(3) 73.72 % 69.50 % Balance of servicing portfolio $ 2,910,422 $ 4,380,876 Average prepayment rate on owned servicing portfolio 27.43 % 31.60 % Book value per share (end of period) $ 10.93 $ 10.61 Loan Performance Ratios(1) - -------------------------- Net charge offs/average loans 0.04 % 0.09 % Allowance for loan and valuation losses/total loans 0.81 % 0.63 % - -------------------------- (1) Calculations are based on average daily balances where available and monthly averages otherwise, as applicable. (2) Net interest margin has been calculated by dividing net interest income before loan and valuation loss provision by average interest-earning assets. (3) The operating efficiency ratio has been calculated by dividing noninterest expense, excluding amortization of mortgage servicing rights, by operating income. Operating income is equal to net interest income before provision for loan and valuation losses plus noninterest income.
-----END PRIVACY-ENHANCED MESSAGE-----