Bay View Capital Corporation Announces First Quarter Results SAN
MATEO, Calif., April 27 /PRNewswire-FirstCall/ -- Bay View Capital
Corporation (the "Company") today reported its results for the
first quarter of 2004. As previously announced, during the fourth
quarter of 2003, the Company's Board of Directors amended the Plan
of Dissolution and Stockholder Liquidity (the "Plan"), which the
Company adopted in October 2002, to become a plan of partial
liquidation. As a result, the Company discontinued its use of the
liquidation basis of accounting and re-adopted the going concern
basis of accounting effective October 1, 2003. The Company reported
its results under the liquidation basis of accounting from
September 30, 2002 through September 30, 2003. First Quarter
Results The Company reported a first quarter 2004 net loss of $1.1
million, or $0.02 per diluted share, compared to a fourth quarter
2003 net loss of $0.9 million, or $0.01 per diluted share. Net
interest income increased to $2.6 million for the first quarter of
2004 from $1.0 million for the prior quarter. The increase in net
interest income was primarily due to lower interest expense
resulting from the redemption of $63.5 million, or approximately
74%, of the 9.76% Cumulative Capital Securities (NYSE:BVS) in
December 2003. At March 31, 2004, the Company's total assets were
$368 million compared to $364 million at December 31, 2003. The
Company continues to make progress in resolving the remaining
assets and liabilities from discontinued banking activities. During
the quarter, the Company's investment in operating lease assets was
reduced by $21.6 million primarily as a result of repayments. Also
during the quarter, the Company sold approximately $5.1 million of
its mortgage-backed securities and received approximately $5.5
million of loan repayments from its liquidating loan portfolio. At
March 31, 2004, the net carrying value of the Company's remaining
investment in loans to be liquidated totaled $6.8 million compared
to $12.1 million at December 31, 2003. The Company's total
nonperforming assets, net of mark-to-market valuation adjustments,
declined to $5.8 million at March 31, 2004 from $7.1 million at
December 31, 2003. The decrease in nonperforming assets was
primarily due to a decline in nonaccruing asset-based loans and the
sale of real estate owned and other repossessed assets. Total loans
delinquent 60 days or more declined to $652 thousand at March 31,
2004 from $748 thousand at December 31, 2003. At March 31, 2004,
the Company had deferred tax assets of approximately $16.5 million,
consisting of net deferred tax assets of $38.0 million less a
valuation allowance of $21.5 million. On March 31, 2004, the
Company paid the quarterly dividend due on the remaining Bay View
Capital I Trust, 9.76% Cumulative Capital Securities (the "Capital
Securities") outstanding as of March 30, 2004 totaling $0.61 per
Capital Security. In connection with the liquidation of the assets
and satisfaction of the liabilities of Bay View Bank, N.A. (the
"Bank"), remaining after the Bank's September 30, 2003 dissolution,
the Company anticipates making a cash distribution of $0.25 per
share to common stockholders at the end of the second quarter of
2004 as previously indicated. The Company further anticipates
continuing to redeem the Capital Securities through a series of one
or more additional partial redemptions beginning in June 2004. The
Company's Board of Directors has authorized the Company to seek
stockholder approval to authorize an amendment to the Company's
Certificate of Incorporation to effect a 1-for-10 reverse stock
split of the issued and outstanding shares of the Company's common
stock in the second quarter of 2004. If approved by the Company's
stockholders, a reverse stock split would affect all shares of
common stock, including those shares underlying stock options and
warrants, outstanding immediately prior to the effective time of
the reverse stock split. The Company intends to file a preliminary
proxy statement regarding the reverse stock split proposal with the
Securities and Exchange Commission and mail a definitive proxy
statement regarding this proposal to its stockholders. Bay View
Acceptance Corporation BVAC, a wholly-owned subsidiary of the
Company, is a Southern California-based auto finance company
engaged in the indirect financing of automobile purchases by
individuals. BVAC currently acquires auto installment contracts
from over 7,000 manufacturer-franchised and independent auto
dealers in 24 states and has positioned itself in the market as a
premium priced lender for well-qualified borrowers seeking extended
financing terms and higher advances than those generally offered by
traditional lenders. This strategy has enabled BVAC to establish a
loyal dealership network by satisfying a unique niche within the
indirect auto finance arena, which is not dominated by large
commercial banks and captive finance companies. BVAC's first
quarter 2004 net income was $412 thousand compared to net income of
$586 thousand for the fourth quarter of 2003. The decrease was
primarily the result of higher noninterest expense and lower
noninterest income partially offset by an increase in net interest
income. During the quarter, BVAC sold $5.3 million of auto
installment contracts and received repayments of $22.8 million.
BVAC purchased $69.3 million of auto installment contracts during
the first quarter of 2004, compared to $67.4 million for the prior
quarter. Purchase volume for the first quarter of 2004 consisted of
2,289 contracts with a weighted-average contract rate of 7.90% and
a weighted-average FICO score of 734; purchase volume for the
fourth quarter of 2003 consisted of 2,292 contracts with a
weighted-average contract rate of 8.03% and a weighted-average FICO
score of 735. At March 31, 2004, BVAC was servicing 29,824
installment contracts representing $560 million compared to 30,800
installment contracts representing $563 million at December 31,
2003. Other As discussed above, the Company reported its results
under the liquidation basis of accounting for the periods September
30, 2002 through September 30, 2003. The Company is providing
herein: Financial Condition: Consolidated Statements of Financial
Condition as of March 31, 2004 and December 31, 2003 Results of
Operations / Change in Net Assets: Consolidated Statements of
Operations and Comprehensive Loss for the three-month periods ended
March 31, 2004 and December 31, 2003 and a Consolidated Statement
of Changes in Net Assets in Liquidation (Liquidation Basis) for the
three-month period ended March 31, 2003. The Company will host a
conference call at 2:00 p.m. PDT on April 28, 2004 to discuss its
financial results. Analysts, media representatives and the public
are invited to listen to this discussion by calling 1-888-793-6954
and referencing the password "BVC." An audio replay of this
conference call will be available through Friday, May 28, 2004 and
can be accessed by dialing 1-800-294-2498. Bay View Capital
Corporation is a financial services company headquartered in San
Mateo, California and is listed on the NYSE: BVC. For more
information, visit our website at http://www.bayviewcapital.com/.
Forward-Looking Statements All statements contained in this release
that are not historic facts are based on current expectations. Such
statements are forward-looking statements (as defined in the
Private Securities Litigation Reform Act of 1995) in nature and
involve a number of risks and uncertainties. Although the Company
currently believes that the assumptions underlying the
forward-looking statements are reasonable, any of the assumptions
could prove inaccurate and, therefore, there can be no assurance
that the results contemplated by the forward-looking statements
will be realized. For information regarding factors that could
cause the results contemplated by the forward-looking statements to
differ from expectations, such as the inability to achieve the
financial goals of both our plan of partial liquidation, including
any financial goals related to contemplated asset resolutions; and
our plan for the continuing operation of the auto business,
including the inability to use net operating loss carryforwards
that the Company currently has, please refer to the Company's
Reports on Forms 10-K and 10-Q filed with the Securities and
Exchange Commission. In light of the significant uncertainties
inherent in the forward-looking statements included herein, the
inclusion of such statements should not be regarded as a
representation by the Company or any other person. The Company
disclaims any obligation to update such factors or to publicly
announce the results of any revisions to any of the forward-looking
statements included herein to reflect future events or
developments. Bay View Capital Corporation Consolidated Statements
of Financial Condition March 31, December 31, 2004 2003 (Unaudited)
Going Concern Basis (Dollars in thousands) ASSETS Cash and cash
equivalents: Cash and due from depository institutions $1,052
$11,434 Short-term investments 3,077 129 4,129 11,563 Restricted
cash 40,939 32,240 Securities available-for-sale: Retained
interests in securitizations 29,040 28,590 Mortgage-backed and
other securities 750 6,139 Loans held-for-sale: Installment
contracts 206,929 165,574 Other loans 6,817 12,074 Investment in
operating lease assets, net 45,133 66,657 Real estate owned, net
4,254 4,955 Premises and equipment, net 373 371 Repossessed
vehicles 420 438 Income taxes, net 15,540 21,149 Goodwill 1,846
1,846 Other assets 12,191 12,340 Total assets $368,361 $363,936
LIABILITIES AND STOCKHOLDERS' EQUITY Borrowings: Warehouse credit
facility $155,158 $138,221 Other borrowings 10,211 16,055 Junior
Subordinated Deferrable Interest Debentures 24,784 24,784 Other
liabilities 12,361 17,500 Liquidation reserve 10,550 11,626 Total
liabilities 213,064 208,186 Stockholders' equity: Common stock
($.01 par value); authorized, 80,000,000 shares; issued, 2004 -
65,820,977 shares; 2003 - 65,793,330 shares; outstanding, 2004 -
65,786,545 shares; 2003 - 65,758,898 shares 658 658 Additional
paid-in capital 156,615 156,588 Accumulated deficit (1,943) (855)
Treasury stock, at cost; 34,432 shares (587) (587) Accumulated
other comprehensive gain (loss) 554 (54) Total stockholders' equity
155,297 155,750 Total liabilities and stockholders' equity $368,361
$363,936 Bay View Capital Corporation Consolidated Statements of
Operations and Comprehensive Loss (Unaudited) For the Three Months
Ended March 31, December 31, 2004 2003 (Amounts in thousands,
except per share amounts) Interest income: Interest on loans and
leases $3,754 $3,457 Interest on mortgage-backed securities 29 166
Interest and dividends on investment securities 728 1,013 4,511
4,636 Interest expense: Interest on borrowings 1,942 3,612 1,942
3,612 Net interest income 2,569 1,024 Noninterest income: Leasing
income 5,228 6,907 Loan fees and charges 500 213 Loan servicing
income 947 1,132 Gain (loss) on sale of assets and liabilities, net
(305) 842 Other, net 771 1,241 7,141 10,335 Noninterest expense:
General and administrative 6,541 5,747 Leasing expenses 4,667 5,938
Real estate owned operations, net 291 831 11,499 12,516 Loss before
income tax benefit (1,789) (1,157) Income tax benefit (702) (302)
Net loss $(1,087) $(855) Basic loss per share $(0.02) $(0.01)
Diluted loss per share $(0.02) $(0.01) Weighted-average basic
shares outstanding 65,778 64,187 Weighted-average diluted shares
outstanding 65,778 64,187 Net loss $(1,087) $(855) Other
comprehensive income (loss), net of tax: Change in unrealized gain
(loss) on securities available-for-sale, net of tax expense
(benefit) of $389 and ($35) for the three months ended March 31,
2004 and December 31, 2003, respectively 608 (54) Other
comprehensive income (loss) 608 (54) Comprehensive loss $(479)
$(909) Bay View Capital Corporation Consolidated Statement of
Changes in Net Assets in Liquidation (Liquidation Basis)
(Unaudited) For the Three Months Ended March 31, 2003 (Dollars in
thousands) Net assets in liquidation, December 31, 2002 $410,064
Pre-tax income from operations 1,415 Changes in estimated values of
assets and liabilities (1,664) Income tax benefit 802 Net income
from operations 553 Dividends on Capital Securities (2,251) Other
changes in net assets in liquidation (A) 2,598 Net assets in
liquidation, March 31, 2003 $410,964 (A) Primarily represents
proceeds from stock options and warrants exercised. BAY VIEW
CAPITAL CORPORATION SELECTED FINANCIAL DATA (Unaudited) For the
Three Months Ended March 31, December 31, March 31, 2004 2003 2003
Liquidation Going Concern Basis Basis (Amounts in thousands, except
per share amounts) Selected Results of Operations/Changes in Net
Assets in Liquidation Information: Net interest income (A) $2,569
$1,024 $3,294 Leasing income 5,228 6,907 12,911 Gain (loss) on sale
of assets and liabilities, net (305) 842 53 Other income, net 2,218
2,586 1,970 General and administrative expenses (6,541) (5,747)
(9,460) Leasing expense (4,667) (5,938) (9,454) Other expense (291)
(831) (150) Pre-tax loss from operations (1,789) (1,157) (836)
Changes in estimated liquidation values of assets and liabilities
-- -- (1,664) Income tax benefit 702 302 802 Other changes in net
assets in liquidation -- -- 2,598 Change in net assets in
liquidation -- -- $900 Net loss $(1,087) $(855) At Dec. 31, At
March 31, 2004 2003 At March 31, 2003 Going Concern Basis
Liquidation Basis (Amounts in thousands) Loans and Leases
Receivable: Auto installment contracts (B) $206,929 $165,574
$157,701 Other loans and leases: Multi-family mortgage loans -- --
1,417 Commercial mortgage loans -- -- 3,061 Franchise loans 6,314
6,428 37,849 Asset-based loans, syndicated loans, factored
receivables and commercial leases 503 844 24,261 Business loans --
4,802 7,206 Total other loans and leases 6,817 12,074 73,794 Loans
and leases receivable (C) (D) $213,746 $177,648 $231,495 Credit
Quality: Nonperforming assets - total (E) $5,828 $7,133 $ 22,008
Nonperforming assets - franchise $5,045 $5,757 $17,451
Nonperforming assets as a percentage of consolidated assets 1.58%
1.96% 3.70% Loans and leases delinquent 60 days or more $652 $748
$8,515 Loans and leases delinquent 60 days or more - franchise $--
$-- $6,431 Loans and leases delinquent 60 days or more as a
percentage of loans and leases 0.31% 0.42% 3.68% Per Share Data:
Book value per share $2.36 $2.37 N/A Net assets in liquidation per
diluted share outstanding N/A N/A $6.41 Other Data: Full-time
equivalent employees, including BVAC 134 143 236 (A) Effective July
1, 2003, the Company adopted Statement of Financial Accounting
Standards No. 150, "Accounting for Certain Financial Instruments
with Characteristics of both Liabilities and Equity." Dividend
expense on the Capital Securities is now reflected as interest
expense on borrowings. (B) Excludes auto-related operating lease
assets reported separately from loans and leases totaling $45.1
million, $66.7 million and $154.0 million at March 31, 2004,
December 31, 2003 and March 31, 2003, respectively. (C) All loans
and leases are classified as held-for-sale. (D) Includes
mark-to-market valuation reserves of $0.9 million, $3.2 million and
$24.1 million at March 31, 2004, December 31, 2003 and March 31,
2003, respectively. (E) Nonperforming assets include mark-to-market
valuation reserves of $0.8 million, $1.4 million and $9.9 million
at March 31, 2004, December 31, 2003, and March 31, 2003,
respectively. BAY VIEW ACCEPTANCE CORPORATION At Dec. 31, At March
31, 2004 2003 At March 31, 2003 Going Concern Basis (Amounts in
thousands) Selected Balance Sheet Information: Cash and cash
equivalents $(642) $2,841 $(147) Restricted cash 9,025 5,130 278
Retained interests in auto loan securitizations 29,040 29,789
24,671 Installment contracts 206,929 165,574 157,701 Other assets
6,522 6,861 3,494 Total assets $250,874 $210,195 $185,997 Advances
from parent $22,771 $802 $119,122 Warehouse line 155,158 138,221 --
Other liabilities 11,623 10,118 7,975 Total liabilities 189,552
149,141 127,097 Stockholder's equity 61,322 61,054 58,900 Total
liabilities and stockholder's equity $250,874 $210,195 $185,997 For
the Three Months Ended March 31, December 31, March 31, 2004 2003
2003 Going Concern Basis (Amounts in thousands, except per share
amounts) Selected Results of Operations Information: Interest on
auto contracts $3,512 $2,994 $2,816 Interest on investment
securities 666 540 750 Interest expense on borrowings (1,319)
(1,269) (708) Net interest income 2,859 2,265 2,858 Loan fees and
charges 215 215 244 Loan servicing income 939 1,056 973 Gain (loss)
on sale of assets, net (212) 16 -- Other income, net (183) (144) 50
Unrealized loss on auto contracts held-for-sale -- -- (93) General
and administrative expenses (2,910) (2,394) (2,847) Income before
income tax expense 708 1,014 1,185 Income tax expense (296) (428)
(494) Net income $412 $586 $691 Selected Production Information:
Installment contracts purchased $69,337 $67,413 $71,635 Number of
contracts purchased 2,289 2,292 2,533 Average balance of contracts
purchased $30.2 $29.4 $28.3 Weighted-average contract rate 7.90%
8.03% 8.70% Average FICO credit score 734 735 728 Net yield on
contracts purchased 7.08% 7.16% 7.67% Net yield on warehouse
inventory 7.30% 7.79% 6.54% Selected Credit Quality Information:
Net chargeoffs on managed contracts for period $1,739 $1,882 $1,984
Net chargeoffs as a percentage of average managed contracts
(annualized) 1.23% 1.32% 1.28% Contracts delinquent 30 days or more
as a percentage of managed contracts (as of period-end) 0.41% 0.49%
0.45% Average Managed Contracts $566,371 $567,549 $627,858 At Dec.
31, At March 31, 2004 2003 At March 31, 2003 (Amounts in thousands)
Managed Contracts (period-end): Total managed contracts $560,389
$562,771 $601,682 Total number of contracts 29,824 30,808 35,200
Other Data: Full-time equivalent employees 101 102 136 DATASOURCE:
Bay View Capital Corporation CONTACT: John Okubo of Bay View
Capital Corporation, +1-650-294-7778 Web site:
http://www.bayviewcapital.com/
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