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Provident Financial Services

Provident Financial Services

Banking Services Provider company Provident Financial Service , Inc. (PFS-NYSE) ; which preferably checking accounts , home equity loans, credit cards, investment, telephone banking ,bills payment and merchant banking services, released fourth quarter final year earnings report today. The company reported net income of $26 Million, or $0.40 per basic and diluted share for the quarter ended December 31, 2019 ; compared to net income of $35.8 Million or $0.55 per basic and diluted share for the quarter ended December 31,2018.

For the year ended December 31, 2019, PFS reported net income of $112.6 million , or $1.74 per basic and diluted share , compared to net income of $118.4 million or $1.82 per basic and diluted share for 2018.

For the quarter and year ended December 31, 2019, the Company’s earnings were adversely impacted by a $2.0 million, or $0.03 per basic and diluted share, net of tax expense, increase in the estimated fair value of the contingent consideration related to the April 1, 2019 acquisition of Tirschwell & Loewy, Inc. (“T&L”), a New York City-based registered investment advisor.  As previously disclosed, the earn-out of this contingent consideration is based upon T&L achieving certain revenue growth and retention targets over a three-year period from the date of acquisition.  Based upon recent performance and improved projections for the remaining measurement period, an increase to the fair value of the contingent liability was warranted.  At December 31, 2019, the contingent liability was $9.4 million, with maximum potential future payments totaling $11.0 million.  Excluding this charge, the Company would have reported net income of $27.9 million, or $0.43 per basic and diluted share, and net income of $114.6 million, or $1.77 per basic and diluted share, for the quarter and year ended December 31, 2019, respectively.

For the quarter and the year ended December 31, 2018, a non-recurring $1.9 million tax benefit was recorded stemming from the Company’s completion of a cost segregation study that assigned shorter taxable lives to certain fixed assets.  This benefit contributed $0.03 per basic and diluted share for both the quarter and year ended December 31, 2018.  In addition, the Company realized a $1.6 million, or $0.02 per share, net of tax gain on the sale of Visa Class B common shares in the fourth quarter of 2018.

PFS Dividend Declaration :

The company board of Directors of Provident Financial Service (PFS-NYSE) declared a quarterly cash dividend of $0.23 per common share payable on February 28, 2020 to PFS stockholders of record as of the close business of February 14, 2020.

PFS Balance Sheet Summary :

Total assets at December 31, 2019 were $9.81 billion, an $82.8 million increase from December 31, 2018.  The increase in total assets was primarily due to an $82.3 million increase in total loans, a $62.6 million increase other assets, a $44.1 million increase in total cash and cash equivalents and an $18.8 million increase in intangible assets, partially offset by a $123.3 million decrease in total investments.

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The increase in other assets was largely due to the Provident Financial Services’ January 1, 2019 adoption of a new lease accounting standard.  The Company recorded a right of use asset of $44.9 million, which was based on the present value of the expected remaining lease payments at January 1, 2019.

The Company’s loan portfolio increased $82.3 million to $7.33 billion at December 31, 2019, from $7.25 billion at December 31, 2018.  For the year ended December 31, 2019, loan originations, including advances on lines of credit, totaled $2.83 billion, compared with $3.16 billion for 2018.  The loan portfolio had net increases of $279.1 million in commercial mortgage loans and $40.8 million in construction loans, partially offset by net decreases of $114.1 million in multi-family mortgage loans, $60.4 million in commercial loans and $21.8 million in residential mortgage loans.  Commercial real estate, commercial and construction loans represented 80.0% of the total loan portfolio at December 31, 2019, compared to 78.9% at December 31, 2018.

At December 31, 2019, the Company’s unfunded loan commitments totaled $1.47 billion, including commitments of $615.3 million in commercial loans, $437.5 million in construction loans and $180.4 million in commercial mortgage loans.  Unfunded loan commitments at September 30, 2019 and December 31, 2018 were $1.65 billion and $1.49 billion, respectively.

The loan pipeline, consisting of work-in-process and loans approved pending closing, totaled $905.9 million at December 31, 2019, compared to $1.09 billion and $973.4 million at September 30, 2019 and December 31, 2018, respectively.

Total investments were $1.49 billion at December 31, 2019, a $123.3 million decrease from December 31, 2018.  This decrease was largely due to repayments of mortgage-backed securities, maturities and calls of certain municipal and agency bonds, partially offset by purchases of mortgage-backed and municipal securities and an increase in unrealized gains on available for sale debt securities.

Intangible assets increased $18.8 million to $437.0 million at December 31, 2019.  The increase in intangible assets was primarily related to the Company’s acquisition of T&L, partially offset by scheduled amortization.

Total deposits increased $272.5 million during the year ended December 31, 2019 to $7.10 billion.  Total core deposits, consisting of savings and demand deposit accounts, increased $289.0 million to $6.37 billion at December 31, 2019, while total time deposits decreased $16.5 million to $734.0 million at December 31, 2019.  The increase in core deposits for the year ended December 31, 2019 was largely attributable to a $241.9 million increase in money market deposits, a $72.5 million increase in non-interest bearing demand deposits and a $42.8 million increase in interest bearing demand deposits, partially offset by a $68.2 million decrease in savings deposits.  Core deposits represented 89.7% of total deposits at December 31, 2019, compared to 89.0% at December 31, 2018.

Borrowed funds decreased $317.1 million during the year ended December 31, 2019, to $1.13 billion.  The decrease in borrowings for the period was primarily the result of wholesale funding being partially replaced by the net inflows of deposits.  Borrowed funds represented 11.5% of total assets at December 31, 2019, a decrease from 14.8% at December 31, 2018.

Provident Financial Services’ Stockholders’ equity increased $54.9 million during the year ended December 31, 2019 to $1.41 billion, primarily due to net income earned for the period and an increase in unrealized gains on available for sale debt securities, partially offset by dividends paid to stockholders and common stock repurchases.  Common stock repurchases during the year ended December 31, 2019, totaled 916,326 shares at an average cost of $23.81, of which 73,311 shares, at an average cost of $27.08, were made in connection with withholding to cover income taxes on the vesting of stock-based compensation. At December 31, 2019, 1.6 million shares remained eligible for repurchase under the current authorization. Book value per share and tangible book value per share at December 31, 2019 were $21.49 and $14.85, respectively, compared with $20.49 and $14.18, respectively, at December 31, 2018.

News Source Link : Globenewswire.com

Tags : PFS Dividend offerPFS fourth Quarter earningsProvident Dividend AnnouncementProvident Financial ServicesProvident fourth quarter earnings
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