Investors Bancorp Inc. Reports Operating Results (10-Q)
Investors Bancorp Inc. has a market cap of $1.54 billion; its shares were traded at around $13.43 with a P/E ratio of 35.34 and P/S ratio of 7. ISBC is in the portfolios of Jim Simons of Renaissance Technologies LLC, Steven Cohen of SAC Capital Advisors, Charles Brandes of Brandes Investment.
Highlight of Business Operations:While the interest rate environment is important to our net interest income, so is the composition of our balance sheet. The recent turmoil in the financial markets has created uncertainty and volatility for many financial institutions. This created an opportunity for us to add more loans and increase the size of our balance sheet. Net loans increased to $6.80 billion at March 31, 2010 from $6.62 billion at December 31, 2009, an increase of 2.8%. Diversification of the loan portfolio remains an important goal and during the three months ended March 31, 2010 commercial real estate loans increased $79.2 million, or 10.9%, to $809.2 million and multi-family loans increased $37.7 million, or 6.2% to $650.5 million. This may provide us with an opportunity to increase net interest income and improve our interest rate risk position. As we add more loans to our balance sheet we remain focused on maintaining our historically strict underwriting standards. We have never originated any sub-prime loans, negative amortization loans or option ARM loans.
Total Assets. Total assets increased by $390.9 million, or 4.7%, to $8.75 billion at March 31, 2010 from $8.36 billion at December 31, 2009. This increase was largely the result of a $210.9 million increase in our cash and cash equivalents at March 31, 2010 from $73.6 million at December 31, 2009 to $284.5 million at March 31, 2010 and a $180.5 million increase in net loans, including loans held for sale.
Additionally, for the three month period ended March 31, 2010, we originated $40.4 million in multi-family loans, $86.9 million in commercial real estate loans, $27.0 million in construction loans, $14.5 in consumer and other loans, and $2.0 million in commercial and industrial loans. This activity is consistent with our strategy to diversify our loan portfolio by adding more multi-family and commercial real estate loans.
At March 31, 2010 loans meeting the Companys definition of an impaired loan were primarily collateral-dependent and totaled $42.1 million of which $34.2 million of impaired loans had a related allowance for credit losses of $8.2 million and $7.9 million of impaired loans had no related allowance for credit losses. At December 31, 2009, loans meeting the Companys definition of an impaired loan were primarily collateral dependent and totaled $48.4 million, of
which $35.7 million of impaired loans had a related allowance for credit losses of $8.9 million and $12.7 million of impaired loans had no related allowance for credit losses.
The allowance for loan losses increased by $7.9 million to $62.9 million at March 31, 2010 from $55.1 million at December 31, 2009. The increase in the allowance was primarily attributable to the higher current year loan loss provision which reflects the overall growth in the loan portfolio, particularly residential and commercial real estate loans; the increased inherent credit risk in our overall portfolio, particularly the credit risk associated with commercial real estate lending; the increase in non-performing loans; and the continued adverse economic environment, offset partially by net charge offs of $5.2 million.
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