John Kanas, Chairman, President and CEO
Morning everybody. We are happy to give you the results of the fourth quarter and the year. We’re also happy that RBC had their conference today. Certainly none of you would be here listening to us. I’m sure we’ll have a discussion about that as this conversation goes on. So we did a little better than we thought we would do in the fourth quarter, about $0.45 a share, $46.8 million which beat the consensus by about a penny. More importantly, we had a conversation with many of you at the end of the third quarter. We reported to you at that time that a lot of the loans that we expected to close in the third quarter slipped over into the fourth and that we anticipated that fourth quarter loan and lease growth would be somewhere between $1.2 billion and $1.4 billion. Actually it did a little better than that. The loans that slipped over into the fourth quarter did close, and the fourth quarter itself and quite frankly the momentum building and going into ‘15 is actually a little stronger than we had expected it to be. About a $1.5 billion of growth of those assets. That’s divided into New York about $770 million, Florida about $300 million and the national platform, the combination of all them, about a little over $400 million.
So if you want to look back on the year, $1.95 a share in earnings and with regards to the balance sheet and where we expected it to be and what we told you earlier this year, in summary we grew loans about $4 billion, a little bit more than $4 billion and we grew deposits to about $3 billion. And we said earlier this year that that was our goal to grow deposits about three quarters of the amount that we grow loans and eke up a little bit our loan to deposit ratio which is now at just a little bit over 90%, I guess about 92%. You should expect that same kind of trend to continue into ‘15. We intent to raise the loan to deposit ratio further and you’ll probably continue to see the growth in loans outstripping the growth in deposits, but fully recognizing that as the year unfolds and if we get the growth we expect in 2015, that we will turn more of our attention to deposit growth as the year goes by.
Competition remains crazy in both of these markets. Interest rate and margin compression is something that unfortunately plagues this entire industry and this very difficult, if not hostile, banking environment. Don’t expect that to change anytime soon. You know that we have always reported to you that because we have no idea where interest rates are going and have never been sure when or if they were going up, we continue to keep this balance sheet extremely neutral, give up some earnings to do it, but play the safe side of that and that’s worked out very well for us. Asset quality doesn’t really bear much of a discussion. It continues to be very strong. Non-performers to total loans 29 basis points. And you’ll see and I know that some of you have already asked questions but we’ve taken a pretty good shot at increasing loan loss reserve this quarter, consistent with the growth in this loan portfolio to try to remain conservative as time goes by. Deposits grew – it was actually $678 million, almost $700 million for the quarter and again we expect that to continue.
So overall, very, very happy with the quarter. We are in that period that period that we’ve described to you for the last couple of the years where the earnings are under pressure and will be for the next quarter or two, but clearly we can see our way through to the second half of the year such that EPS is on its way up in the second half of 2015, particularly, if we continue to get the kind of asset growth that we are experiencing. All indications are that that will continue. I’m going to turn it over to Raj now and then to Leslie and then we’ll come back for questions.
