Provident Financial Holdings Inc. Reports Operating Results (10-Q)
Provident Financial Holdings Inc. has a market cap of $66.66 million; its shares were traded at around $5.85 with and P/S ratio of 0.63. The dividend yield of Provident Financial Holdings Inc. stocks is 0.68%.PROV is in the portfolios of Jim Simons of Renaissance Technologies LLC.
Highlight of Business Operations:Provident Financial Holdings, Inc., a Delaware corporation, was organized in January 1996 for the purpose of becoming the holding company of Provident Savings Bank, F.S.B. upon the Bank s conversion from a federal mutual to a federal stock savings bank (“Conversion”). The Conversion was completed on June 27, 1996. At March 31, 2010, the Corporation had total assets of $1.41 billion, total deposits of $947.9 million and total stockholders equity of $124.4 million. The Corporation has not engaged in any significant activity other than holding the stock of the Bank. Accordingly, the information set forth in this report, including financial statements and related data, relates primarily to the Bank and its subsidiaries.
Total assets decreased $174.3 million, or 11 percent, to $1.41 billion at March 31, 2010 from $1.58 billion at June 30, 2009. The decrease was primarily attributable to decreases in investment securities and loans held for investment, partly offset by an increase in cash and cash equivalents and an increase in loans held for sale at fair value. The decline in total assets and the increase in cash and cash equivalents are consistent with the Corporation strategy of deleveraging the balance sheet to improve capital ratios and to mitigate credit and liquidity risk.
Total cash and cash equivalents, primarily excess cash at the Federal Reserve Bank of San Francisco, increased $29.1 million, or 51 percent, to $86.0 million at March 31, 2010 from $56.9 million at June 30, 2009.
Total investment securities decreased $88.9 million, or 71 percent, to $36.4 million at March 31, 2010 from $125.3 million at June 30, 2009. The decrease was primarily the result of the sale of $65.3 million of investment securities for a net gain of $2.3 million as well as the scheduled and accelerated principal payments on mortgage-backed securities of $19.1 million. The Bank determined that the sale of investment securities would help satisfy its short-term deleveraging strategy. The Bank evaluates individual investment securities quarterly for other-than-temporary declines in market value. The Bank does not believe that there are any other-than-temporary impairments at March 31, 2010; therefore, no impairment losses have been recorded for the quarter ended March 31, 2010.
Loans held for investment decreased $132.5 million, or 11 percent, to $1.03 billion at March 31, 2010 from $1.17 billion at June 30, 2009. Total loan principal payments during the first nine months of fiscal 2010 were $99.0 million, compared to $126.0 million during the comparable period in fiscal 2009. In addition, real estate owned acquired in the settlement of loans in the first nine months of fiscal 2010 was $45.1 million, an increase from $41.6 million in the same period last year. During the first nine months of fiscal 2010, the Bank originated $2.3 million of loans held for investment, primarily commercial real estate loans, compared to $20.1 million for the same period last year. The Bank did not purchase any loans to be held for investment in the first nine months of fiscal 2010 as compared to $595,000 in the same period in fiscal 2009, given the economic uncertainty of the current banking environment. The balance of preferred loans decreased to $470.4 million, or 43 percent of loans held for investment at March 31, 2010, as compared to $508.7 million, or 42 percent of loans held for investment at June 30, 2009. Purchased loans serviced by others at March 31, 2010 were $23.7 million, or two percent of loans held for investment, compared to $125.4 million, or 11 percent of loans held for investment at June 30, 2009. The decrease in the purchased loans serviced by others was primarily attributable to the Bank s decision in September 2009 to acquire approximately $95.3 million of loan servicing from one of its loan servicers who no longer met their contractual loan servicing covenants, resulting in a 25 basis point increase to the loan yield of these loans.
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