Welcome!

News Feed Item

Washington Federal Reports Quarterly Net Income Increased 7% to $35 Million

SEATTLE, WA -- (Marketwire) -- 01/15/13 -- Washington Federal, Inc. (NASDAQ: WAFD), parent company of Washington Federal, today announced earnings of $35,282,000 or $.33 per diluted share for the quarter ended December 31, 2012, compared to $33,418,000 or $.31 per diluted share for the same period one year ago, a $1.9 million or 7% increase per diluted share. The Company's ratio of tangible common equity to tangible assets ended the quarter at 12.83% and its total risk-based capital ratio was 26.25%. Both of these ratios continue to be among the best of large regional financial institutions in the U.S.

Chairman, President & CEO Roy M. Whitehead commented, "We are pleased to report another good quarter, helped along by the closing of the South Valley acquisition. We regard the quarterly earnings as quite positive in light of low interest rates and the improving, yet still soft, overall economy."

During the quarter, the Company completed its acquisition of South Valley Bank & Trust (South Valley). The acquisition provided $362 million of loans, $122 million of covered loans, $533 million of transaction deposit accounts and 24 branch locations in Central and Southern Oregon. Total consideration at closing was $44 million, including $34 million of Washington Federal stock and $10 million of cash resulting from the collection of certain earn-out assets. The total purchase price as a percentage of South Valley's tangible book value was 67%. Preliminary purchase accounting has provided for a discount on loans of 5%, a discount on covered loans of 13%, a core deposit intangible asset of $3 million and goodwill of $9 million. These amounts are subject to change, based upon the final valuation which is currently in process.

Total assets increased by $634 million or 5% to $13.1 billion at December 31, 2012, from $12.5 billion at September 30, 2012 due to the acquisition of South Valley. Loans increased by $163 million or 2%. This net increase resulted from the $362 million of acquired loans partially offset by net runoff of $199 million of the Washington Federal loan portfolio as the low interest rate environment caused loan repayments to accelerate. The chart attached shows the average interest rates for 30 year mortgage loans over the last ten years.

Non-performing assets amounted to $264 million or 2.02% of total assets as of December 31, 2012, a $79 million or 23% decrease from December 31, 2011. Non-performing assets peaked at $606 million or 5.03% of total assets on June 30, 2009 and have since decreased by $342 million or 56%. Non-performing loans decreased from $186 million at December 31, 2011 to $163 million as of December 31, 2012, a 12% decrease. Total loan delinquencies were 2.89% as of December 31, 2012, a decrease from the 3.13% at December 31, 2011. Compared to September 30, 2012, total loan delinquencies increased from 2.57% to 2.89%. This increase resulted primarily from the South Valley acquisition. Delinquencies on single family mortgage loans, the largest component of the loan portfolio, decreased to 2.79% from 3.17% as of December 31, 2011 and increased by 6 basis points on a linked quarter basis from 2.73% as of September 30, 2012. The Company's single family mortgage loan delinquency ratio of 2.79% remains significantly better than the national average of 11.4%(i).

Net loan charge-offs decreased from $14 million for the quarter ended December 31, 2011 to $10 million in the current quarter, a 29% decrease. Credit costs for the quarter (including REO costs and provision for loan losses) were $7 million, a decrease from the $22 million for the same quarter one year ago.

Customer deposits increased $657 million or 8% during the quarter. The weighted average rate paid on customer deposits during the quarter was 0.83%, a decrease of 26 basis points from the same quarter last year, as a result of the low interest rate environment. The percentage of transaction deposit accounts has increased to 39% of total deposits.

During the quarter, the Company had an average balance of $507 million in cash and cash equivalents invested overnight at a yield of approximately 0.25%. The Company is maintaining higher than normal amounts of liquidity due to concern about potentially rising interest rates in the future. The period end spread was 2.83% as of December 31, 2012, a decrease from 3.11% as of December 31, 2011.

Net interest income for the quarter was $95 million, an $8 million decrease from the quarter ended December 31, 2011. The net interest margin was 3.22% for the quarter, compared to 3.28% for the prior year. The margin was compressed as asset yields declined more than interest expense.

The Company's efficiency ratio of 38.2% for the quarter remains among the lowest in the industry. The quarter produced a return on assets of 1.11%, and return on equity of 7.41%.

On December 31, 2012, Washington Federal paid a cash dividend of $.08 per share to common stockholders of record on December 27, 2012. This was the Company's 120th consecutive quarterly cash dividend. During the quarter ended December 31, 2012, Washington Federal repurchased 2,696,014 shares at a weighted average price of $16.60. The Company has an authorization to repurchase up to an additional 3,492,016 shares.

The Annual Meeting of Stockholders will be held on Wednesday, January 16, 2013 at 2 p.m. Pacific Time, at the Seattle Sheraton Hotel, at the corner of 6th and Pike in Downtown Seattle. This is a change of venue from what was previously communicated.

About Washington Federal
Washington Federal, with headquarters in Seattle, Washington, has 190 offices in eight western states. To find out more about the Company, please visit our website. The Company uses its website to distribute financial and other material information about the Company, which is routinely posted on and accessible at www.washingtonfederal.com.

Important Cautionary Statements
The foregoing information should be read in conjunction with the financial statements, notes and other information contained in the Company's 2012 Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K.

This press release contains statements about the Company's future that are not statements of historical fact. These statements are "forward looking statements" for purposes of applicable securities laws, and are based on current information and/or management's good faith belief as to future events. The words "believe," "expect," "anticipate," "project," and similar expressions signify forward-looking statements. Forward-looking statements should not be read as a guarantee of future performance. By their nature, forward-looking statements involve inherent risk and uncertainties, which change over time; and actual performance could differ materially from those anticipated by any forward-looking statements. The Company undertakes no obligation to update or revise any forward-looking statement.

(i) OCC Mortgage Metrics Report, 3rd Quarter 2012, which is the most recent data available

                 WASHINGTON FEDERAL, INC. AND SUBSIDIARIES
               CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
                                (UNAUDITED)

                                                December 31,  September 30,
                                                    2012           2012
                                               -------------  -------------
                                                 (In thousands, except per
                                                        share data)
ASSETS
Cash and cash equivalents                      $     637,298  $     751,430
Available-for-sale securities                      2,003,777      1,781,705
Held-to-maturity securities                        1,407,246      1,191,487
Loans receivable, net                              7,614,910      7,451,998
Covered loans, net                                   380,594        288,376
Interest receivable                                   47,830         46,857
Premises and equipment, net                          207,185        178,845
Real estate held for sale                            101,103         99,478
Covered real estate held for sale                     36,030         29,549
FDIC indemnification asset                            90,415         87,571
FHLB stock                                           153,542        149,840
Intangible assets, net                               267,389        256,076
Federal and state income taxes                        26,519         22,513
Other assets                                         133,004        137,219
                                               -------------  -------------
                                               $  13,106,842  $  12,472,944
                                               =============  =============

LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities
Customer accounts
  Transaction deposit accounts                 $   3,571,987  $   2,946,453
  Time deposit accounts                            5,662,104      5,630,165
                                               -------------  -------------
                                                   9,234,091      8,576,618
FHLB advances                                      1,880,000      1,880,000
Advance payments by borrowers for taxes and
 insurance                                            16,552         40,041
Accrued expenses and other liabilities                61,521         76,533
                                               -------------  -------------
                                                  11,192,164     10,573,192
Stockholders' Equity
Common stock, $1.00 par value, 300,000,000
 shares authorized;131,966,720 and 129,950,223
 shares issued; 105,498,098 and 106,177,615
 shares outstanding                                  131,967        129,950
Paid-in capital                                    1,619,026      1,586,295
Accumulated other comprehensive income, net of
 taxes                                                11,639         13,306
Treasury stock, at cost; 26,468,622 and
 23,772,608 shares                                  (355,326)      (310,579)
Retained earnings                                    507,372        480,780
                                               -------------  -------------
                                                   1,914,678      1,899,752
                                               -------------  -------------
                                               $  13,106,842  $  12,472,944
                                               =============  =============
CONSOLIDATED FINANCIAL HIGHLIGHTS
Common stockholders' equity per share          $       18.15  $       17.89
Tangible common stockholders' equity per share         15.61          15.48
Stockholders' equity to total assets                   14.61%         15.23%
Tangible common stockholders' equity to
 tangible assets                                       12.83          13.45
Weighted average rates at period end
  Loans and mortgage-backed securities                  4.63%          4.72%
  Combined loans, mortgage-backed securities
   and investment securities                            4.09           4.18
  Customer accounts                                     0.79           0.90
  Borrowings                                            3.59           3.59
  Combined cost of customer accounts and
   borrowings                                           1.26           1.38
  Interest rate spread                                  2.83           2.80


                 WASHINGTON FEDERAL, INC. AND SUBSIDIARIES
                   CONSOLIDATED STATEMENTS OF OPERATIONS
                                (UNAUDITED)


                                                Quarter Ended December 31,
                                               ----------------------------
                                                    2012           2011
                                               -------------  -------------
                                                 (In thousands, except per
                                                        share data)
INTEREST INCOME
Loans & covered assets                         $     116,843  $     127,479
Mortgage-backed securities                            11,732         26,296
Investment securities and cash equivalents             2,734          2,151
                                               -------------  -------------
                                                     131,309        155,926

INTEREST EXPENSE
Customer accounts                                     18,772         23,949
FHLB advances and other borrowings                    17,103         28,263
                                               -------------  -------------
                                                      35,875         52,212
                                               -------------  -------------

Net interest income                                   95,434        103,714
Provision for loan losses                              3,600         11,210
                                               -------------  -------------
Net interest income after provision for loan
 losses                                               91,834         92,504

OTHER INCOME
Other                                                  4,957          4,645
                                               -------------  -------------
                                                       4,957          4,645

OTHER EXPENSE
Compensation and benefits                             21,072         18,675
Occupancy                                              4,446          3,931
FDIC premiums                                          3,342          4,193
Other                                                  9,438          7,564
                                               -------------  -------------
                                                      38,298         34,363
Gain (loss) on real estate acquired through
 foreclosure, net                                     (3,319)       (10,570)
                                               -------------  -------------
Income before income taxes                            55,174         52,216
Income taxes provision                                19,892         18,798
                                               -------------  -------------
NET INCOME                                     $      35,282  $      33,418
                                               =============  =============

PER SHARE DATA
Basic earnings                                 $         .33  $         .31
Diluted earnings                                         .33            .31
Cash Dividends per share                                 .08            .08
Basic weighted average number of shares
 outstanding                                     105,998,184    107,845,011
Diluted weighted average number of shares
 outstanding, including dilutive stock options   106,043,914    107,894,572

PERFORMANCE RATIOS
Return on average assets                                1.11%           .98%
Return on average common equity                         7.41%          7.02%

Image Available: http://www2.marketwire.com/mw/frame_mw?attachid=2201888

More Stories By Marketwired .

Copyright © 2009 Marketwired. All rights reserved. All the news releases provided by Marketwired are copyrighted. Any forms of copying other than an individual user's personal reference without express written permission is prohibited. Further distribution of these materials is strictly forbidden, including but not limited to, posting, emailing, faxing, archiving in a public database, redistributing via a computer network or in a printed form.

Latest Stories
ChatOps is an emerging topic that has led to the wide availability of integrations between group chat and various other tools/platforms. Currently, HipChat is an extremely powerful collaboration platform due to the various ChatOps integrations that are available. However, DevOps automation can involve orchestration and complex workflows. In his session at @DevOpsSummit at 20th Cloud Expo, Himanshu Chhetri, CTO at Addteq, will cover practical examples and use cases such as self-provisioning infra...
In his keynote at 18th Cloud Expo, Andrew Keys, Co-Founder of ConsenSys Enterprise, provided an overview of the evolution of the Internet and the Database and the future of their combination – the Blockchain. Andrew Keys is Co-Founder of ConsenSys Enterprise. He comes to ConsenSys Enterprise with capital markets, technology and entrepreneurial experience. Previously, he worked for UBS investment bank in equities analysis. Later, he was responsible for the creation and distribution of life settle...
As DevOps methodologies expand their reach across the enterprise, organizations face the daunting challenge of adapting related cloud strategies to ensure optimal alignment, from managing complexity to ensuring proper governance. How can culture, automation, legacy apps and even budget be reexamined to enable this ongoing shift within the modern software factory? In her Day 2 Keynote at @DevOpsSummit at 21st Cloud Expo, Aruna Ravichandran, VP, DevOps Solutions Marketing, CA Technologies, was jo...
Blockchain. A day doesn’t seem to go by without seeing articles and discussions about the technology. According to PwC executive Seamus Cushley, approximately $1.4B has been invested in blockchain just last year. In Gartner’s recent hype cycle for emerging technologies, blockchain is approaching the peak. It is considered by Gartner as one of the ‘Key platform-enabling technologies to track.’ While there is a lot of ‘hype vs reality’ discussions going on, there is no arguing that blockchain is b...
As Marc Andreessen says software is eating the world. Everything is rapidly moving toward being software-defined – from our phones and cars through our washing machines to the datacenter. However, there are larger challenges when implementing software defined on a larger scale - when building software defined infrastructure. In his session at 16th Cloud Expo, Boyan Ivanov, CEO of StorPool, provided some practical insights on what, how and why when implementing "software-defined" in the datacent...
You know you need the cloud, but you’re hesitant to simply dump everything at Amazon since you know that not all workloads are suitable for cloud. You know that you want the kind of ease of use and scalability that you get with public cloud, but your applications are architected in a way that makes the public cloud a non-starter. You’re looking at private cloud solutions based on hyperconverged infrastructure, but you’re concerned with the limits inherent in those technologies.
Leading companies, from the Global Fortune 500 to the smallest companies, are adopting hybrid cloud as the path to business advantage. Hybrid cloud depends on cloud services and on-premises infrastructure working in unison. Successful implementations require new levels of data mobility, enabled by an automated and seamless flow across on-premises and cloud resources. In his general session at 21st Cloud Expo, Greg Tevis, an IBM Storage Software Technical Strategist and Customer Solution Architec...
Nordstrom is transforming the way that they do business and the cloud is the key to enabling speed and hyper personalized customer experiences. In his session at 21st Cloud Expo, Ken Schow, VP of Engineering at Nordstrom, discussed some of the key learnings and common pitfalls of large enterprises moving to the cloud. This includes strategies around choosing a cloud provider(s), architecture, and lessons learned. In addition, he covered some of the best practices for structured team migration an...
The need for greater agility and scalability necessitated the digital transformation in the form of following equation: monolithic to microservices to serverless architecture (FaaS). To keep up with the cut-throat competition, the organisations need to update their technology stack to make software development their differentiating factor. Thus microservices architecture emerged as a potential method to provide development teams with greater flexibility and other advantages, such as the abili...
Product connectivity goes hand and hand these days with increased use of personal data. New IoT devices are becoming more personalized than ever before. In his session at 22nd Cloud Expo | DXWorld Expo, Nicolas Fierro, CEO of MIMIR Blockchain Solutions, will discuss how in order to protect your data and privacy, IoT applications need to embrace Blockchain technology for a new level of product security never before seen - or needed.
The use of containers by developers -- and now increasingly IT operators -- has grown from infatuation to deep and abiding love. But as with any long-term affair, the honeymoon soon leads to needing to live well together ... and maybe even getting some relationship help along the way. And so it goes with container orchestration and automation solutions, which are rapidly emerging as the means to maintain the bliss between rapid container adoption and broad container use among multiple cloud host...
Blockchain is a shared, secure record of exchange that establishes trust, accountability and transparency across business networks. Supported by the Linux Foundation's open source, open-standards based Hyperledger Project, Blockchain has the potential to improve regulatory compliance, reduce cost as well as advance trade. Are you curious about how Blockchain is built for business? In her session at 21st Cloud Expo, René Bostic, Technical VP of the IBM Cloud Unit in North America, discussed the b...
In his general session at 21st Cloud Expo, Greg Dumas, Calligo’s Vice President and G.M. of US operations, discussed the new Global Data Protection Regulation and how Calligo can help business stay compliant in digitally globalized world. Greg Dumas is Calligo's Vice President and G.M. of US operations. Calligo is an established service provider that provides an innovative platform for trusted cloud solutions. Calligo’s customers are typically most concerned about GDPR compliance, application p...
Imagine if you will, a retail floor so densely packed with sensors that they can pick up the movements of insects scurrying across a store aisle. Or a component of a piece of factory equipment so well-instrumented that its digital twin provides resolution down to the micrometer.
The cloud era has reached the stage where it is no longer a question of whether a company should migrate, but when. Enterprises have embraced the outsourcing of where their various applications are stored and who manages them, saving significant investment along the way. Plus, the cloud has become a defining competitive edge. Companies that fail to successfully adapt risk failure. The media, of course, continues to extol the virtues of the cloud, including how easy it is to get there. Migrating...