Fidelity Southern Corp. New (NASDAQ:LION) filed Quarterly Report for the period ended 2010-03-31.
Fidelity Southern Corp. New has a market cap of $86.8 million; its shares were traded at around $8.45 with and P/S ratio of 0.7. LION is in the portfolios of Jim Simons of Renaissance Technologies LLC.
Highlight of Business Operations:For the first quarter of 2010, the Company recorded net income of $195,000 compared to net loss of $3.4 million for the first quarter of 2009. Net loss available to common equity was $628,000 and $4.2 million for the quarters ended March 31, 2010 and 2009, respectively. Per share losses (basic and diluted) for the first quarter of 2010 and 2009 were $.06 and $.42, respectively. The increase in net income for the first quarter when compared to the same period in 2009 was primarily due to a $5.6 million decrease in the provision for loan losses to $4.0 million. The decrease in the provision for loan losses was due to a decline in the required allowance caused by decreased loan charge-offs as the consumer lending portfolio began to show signs of improvement and the construction loan portfolio began to stabilize as compared to the first quarter of 2009. The decrease in loan loss provision was partially offset by higher noninterest expense which increased $3.0 million because of increases in the cost of operation of other real estate, due to higher ORE balances, and increases in salaries and employee benefits because of the expansion of the mortgage division and additional SBA, Commercial and Indirect Automobile lenders and increases in FDIC insurance expense.
Net interest income for the first quarter of 2010 increased $3.6 million to $14.6 million when compared to the same period in 2009. The average balance of interest-earning assets increased by $88.9 million or 5.4% to $1.749 billion for the first quarter of 2010, when compared to the same period in 2009. The yield on interest-earning assets for the first quarter of 2010 was 5.41%, a decrease of 32 basis points when compared to the yield on interest-earning assets for the same period in 2009. The average balance of loans outstanding for the first quarter of 2010 decreased $53.9 million or 3.7% to $1.395 billion when compared to the same period in 2009. Consumer installment and construction lending had the largest decrease from March 2009 to March 2010 as a result of the recession and rising unemployment. The yield on average loans outstanding for the period increased 19 basis points to 6.13% when compared to the same period in 2009 as a result of the effects of a decrease in the level of nonperforming assets from $123.5 million at March 31, 2009 to $88.4 million at March 31, 2010.
Construction loan net charge-offs were $2.3 million in the first three months of 2010 compared to $3.6 million in the same period of 2009. The residential construction markets, while lagging the improvement in the consumer market, are showing some signs of stabilizing. The Banks construction loan nonaccrual loans have shown a positive trend over the past five quarters with a total of $93.3 million, $80.0 million, $73.9 million, $56.3 million and $44.3 million for the quarters ended March 2009 through March 2010, respectively. Management will continue to monitor closely and aggressively address credit quality and trends in the residential construction loan portfolio.
Income from mortgage banking activities decreased $333,000 to $3.3 million for the first quarter of 2010 compared to the same period in 2009. This decrease was due to the mark to market gain on interest rate lock commitments and related hedges of $1.6 million during the first three months of 2009 compared to a mark to market loss of $115,000 for the quarter ended March 31, 2010 resulting in a net decrease of $1.7 million for the first quarter of 2010 compared to the same period in 2009. Partially offsetting this decrease was an increase in gain on sale of loans, origination fees and other income of $1.4 million in 2010 compared to the same period in 2009 due to higher origination volume. The Bank originated a total of $175.8 million in mortgage loans in the first quarter of 2010 compared to $85.0 million for the same period in 2009.
Income from indirect lending activities, which includes both net gains from the sale of indirect automobile loans and servicing and ancillary loan fees on loans sold, decreased $108,000 in the first quarter of 2010 compared to the same period in 2009. The decrease was a result of lower indirect automobile loans serviced for others. The average amount of loans serviced for others decreased from $233 million for the first three months of 2009 to $192 million for the same period in 2010, a decrease of $41 million or 17.6% due to monthly principal payments which exceeded the additional loans serviced for others added. For the quarter ended March 31, 2010, there were servicing retained sales of $10.1 million of indirect automobile loans for a gain on sale of $144,000. For the same period in 2009 there were servicing retained sales of $14.7 million for a gain on sale of $121,000.
Loans decreased $8.5 million to $1.281 billion at March 31, 2010, compared to $1.290 billion at December 31, 2009. The decrease in loans was primarily the result of a decrease in real estate construction loans of $21.2 million or 13.7% to $133.6 million and a decrease in commercial financial and agricultural loans of $9.8 million or 8.6% to $103.8 million. These decreases were somewhat offset by an increase in commercial real estate loans of $25.3 million or 8.8% to $312.7 million. As the recession continued during the first three months of 2010, demand for construction loans continued to be limited and the portfolio balance continued to decrease including $6.9 million in loans that were transferred to other real estate.
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