PrivateBancorp Inc. Reports Operating Results (10-Q)
Privatebancorp Inc. has a market cap of $846.7 million; its shares were traded at around $11.86 with and P/S ratio of 1.5. The dividend yield of Privatebancorp Inc. stocks is 0.3%.PVTB is in the portfolios of John Rogers of ARIEL CAPITAL MANAGEMENT LLC, NWQ Managers of NWQ Investment Management Co, Jim Simons of Renaissance Technologies LLC.
Highlight of Business Operations: As shown in Table 3, the third quarter 2010 tax-equivalent interest income remained flat at $125.5 million compared to the third quarter 2009. The higher volume in average interest-earning assets increased interest income by $3.5 million and a decline in the average rate earned on interest-earning assets decreased interest income by $3.5 million.
The third quarter 2010 interest expense declined by $11.6 million, of which $8.2 million was attributable to an overall decrease in the average rate paid on interest-bearing deposits, due to higher-yielding term deposits shifting to lower-yielding money market accounts and deposit repricing initiatives. Also, a reduction in the volume of short-term borrowings and long-term debt decreased interest expense by $4.3 million. Net interest income increased year-over-year despite the negative effect on our net interest margin of the significant increase in non-accrual loans. Interest foregone on non-accrual loans was estimated to be approximately $4.2 million for the quarter ended September 30, 2010, compared to the estimated $2.9 million for the same period in 2009.
As shown in Table 4, for the nine months ended September 30, 2010, net interest margin was 3.37%, an increase of 44 basis points from 2.93% for the prior year period. Tax-equivalent interest income increased to $387.8 million for the nine months ended September 30, 2010, compared to $348.6 million in the prior period. The increase in interest-earning assets increased interest income by $48.0 million, while a decline in the average rate earned on interest-earning assets reduced interest income by $8.8 million. Interest expense for the nine months ended September 30, 2010 decreased 30% to $84.5 million, compared to $120.5 million in the prior period. Increases in net interest margin and interest income for the current year includes the benefit of a full nine months of higher interest earning assets from the third quarter 2009 FDIC acquisition, primarily in the form of covered assets as presented in Table 4 while the prior year to date period includes three months contribution.
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