Santander BanCorp Doubles Earnings For 2004 Versus 2003 - Net
income for 2004 amounted to $84.5 million, a 114.1% improvement
over net income of $39.4 million for 2003. SAN JUAN, Puerto Rico,
Jan. 26 /PRNewswire-FirstCall/ -- Santander BanCorp (NYSE: SBP;
LATIBEX: XSBP) ("the Company"), reported today its unaudited
financial results for the year and the quarter ended December 31,
2004. Net income for the year ended December 31, 2004 more than
doubles the results reported for the year 2003, reaching $84.5
million, a 114.1% improvement over of $39.4 million reported for
2003. For the quarter ended December 31, 2004, net income amounted
to $21.3 million, a significant increase of 35.5% over net income
of $15.7 million for the quarter ended December 31, 2003. Net
income for the year ended December 31, 2004 reached $84.5 million
or $1.81 per common share. This represents an increase of 114.1%
over net income for the year ended December 31, 2003, of $39.4
million or $0.69 per common share(2). The earnings per common share
for the year ended December 31, 2004 increased by $1.12, which more
than doubles the prior year's earnings per common share. Return on
Average Common Equity (ROE) and Return on Average Assets (ROA) were
16.90% and 1.10%, respectively, for the year ended December 31,
2004, an increase of 1,082 basis points in ROE and 52 basis points
in ROA when compared to ROE and ROA of 6.08% and 0.59%,
respectively, for the year ended December 31, 2003. The Efficiency
Ratio(1) for the year ended December 31, 2004, also reflected a
significant improvement of 651 basis points, reaching 63.54%,
compared to 70.05% for the year ended December 31, 2003. The
improvement in the efficiency ratio during 2004, when compared to
2003, is a direct result of higher revenues and lower expenses. For
the quarter ended December 31, 2004, net income amounted to $21.3
million or $0.46 per common share, compared to net income of $15.7
million or $0.26 per common share(2) for the fourth quarter of
2003. ROE and ROA were 16.04% and 1.08%, respectively, for the
quarter ended December 31, 2004, compared to 8.89% and 0.87%,
respectively, for the fourth quarter of 2003. The Efficiency
Ratio(1) improved by 559 basis points to 60.48% for the fourth
quarter of 2004, compared to 66.07% reported during the fourth
quarter of 2003. The earnings per share computations for all
periods presented in the accompanying financial information have
been adjusted retroactively to reflect the 10% stock dividend
declared by the Board of Directors on July 9, 2004. Income
Statement The increase of $45.0 million or 114.1% in net income for
the year ended December 31, 2004, compared to the same period in
2003 was principally due to an increase of $25.9 million in net
interest income, a decrease in the provision for loan losses of
$23.5 million and a decrease in operating expenses of $6.2 million.
These changes were partially offset by an increase in the provision
for income tax of $8.4 million and a decrease of $2.2 million in
other income due primarily to a decrease in gain on sale of loans.
The $5.6 million improvement in net income for the fourth quarter
of 2004 compared to the same period in 2003 was principally due to
an increase of $0.9 million in net interest income, a decrease of
$10.5 million in the provision for loan losses, an increase in
other income of $1.6 million and a $2.4 million decrease in
operating expenses. These changes were partially offset by an
increase of $9.8 million in the provision for income tax. For the
year ended December 31, 2004, net interest income(1) amounted to
$239.3 million, an increase of 13.5% compared to $210.8 million for
the same period in 2003. This improvement was due to an increase in
average interest earning assets of $932 million or 14.6%, as a
result of an increase in commercial activities as well as a
reduction in total cost of funds of 24 basis points. This was
partially offset by a decrease of 18 basis points in the yield on
interest earning assets. For the quarter ended December 31, 2004,
net interest income(1) amounted to $61.6 million, an increase of
2.8% compared to $59.9 million for the fourth quarter in 2003. The
improvement in net interest income(1) was principally due to an
increase in average interest earning assets of $736 million or
10.8% and a decrease of 28 basis points in total cost of funds. The
provision for loan losses reflected a decrease of $23.5 million or
47.2% from $49.7 million for the year ended December 31, 2003 to
$26.3 million for 2004 due to strong management action on non
performing loan recoveries. Furthermore, for the quarter ended
December 31, 2004, the reduction in the provision for loan losses
was $10.5 million or 70.0% compared to the same period in 2003. The
reduction in the provision for loan losses was due to: (1) a 27.9%
reduction in net charge-offs from $37.1 million for the year ended
December 31, 2004 to $26.8 million for 2004 and (2) an 11% decrease
in non- performing loans, which are down to $87.5 million as of
December 31, 2004 from $98.4 million as of December 31, 2003. In
addition to the improvement in net charge-offs and non-performing
loans, the reduction in the provision for loan losses is due in
part to an improvement in the loss ratios which are used in the
estimation of the allowance for loan losses for its consumer loan
portfolio. For the year ended December 31, 2004, net interest
income after provision for loan losses(1) amounted to $213.1
million, an increase of 32.3% compared to $161.0 million for the
same period in 2003. For the quarter ended December 31, 2004, net
interest income after provision for loans losses(1) amounted to
$57.1 million, an increase of 27.2% compared to $44.9 million for
the fourth quarter in 2003. For the year ended December 31, 2004,
other income decreased $2.2 million compared to the same period in
2003. This decrease was the result of lower gains on sale of loans
of $9.4 million, a decrease of $1.5 million in trading gains and
lower gains on sales of other real estate owned of $1.0 million,
that were partially offset by increases of $1.6 million in mortgage
servicing rights arising from the sale of mortgage loans, $2.8
million in gain on sale of a building, $3.2 million in derivative
gains and $2.1 million in fee income from the broker-dealer, asset
management and insurance operations. For the quarter ended December
31, 2004, there was an increase in other income of $1.6 million or
5.8% from $27.6 million for the quarter ended December 31, 2003 to
$29.2 million for the quarter ended December 31, 2004. This
increase was principally due to higher gains on future contracts
(cover call options) of $3.2 million and in fee income from the
broker-dealer, asset management and insurance operations of $0.7
million. These increases were partially offset by lower gains on
sale of loans of $2.5 million. During the fourth quarter 2004, the
Company decided to utilize cover calls options on a portion of its
investment portfolio to generate additional income, rather than
increase the size of the portfolio given the current low long-term
interest rate environment. For the year ended December 31, 2004,
the Efficiency Ratio(1) improved 651 basis points to 63.54%,
compared to 70.05% for the year ended December 31, 2003. This
improvement was mainly a result of higher revenues (excluding gains
on sales of securities and a gain on the sale of a building during
the first quarter of 2004) and a decrease of $6.2 million or 2.8%
in operating expenses. For the quarter ended December 31, 2004, the
Efficiency Ratio(1) improved 559 basis points to 60.48% from 66.07%
for the same period in 2003. This improvement was a result of
higher revenues (excluding gains on sales of securities) and a
decrease of $2.4 million or 4.2% in operating expenses. For the
year ended December 31, 2004, there were cost reductions of $6.2
million or 2.8% in operating expenses compared to the same period
in 2003. Other operating expenses, excluding personnel expenses,
were reduced by $8.4 million offset by an increase in personnel
expenses of $2.2 million. This expense reduction was primarily due
to a decrease of $9.2 million or 23% in electronic data processing
servicing, amortization and technical services due to lower
servicing costs. There were also decreases in amortization of
intangibles of $2.5 million, repossessed assets provision and
expenses of $2.6 million and collections and related legal costs of
$3.6 million. These decreases were partially offset by increases in
professional services of $5.6 million, partly associated with the
implementation of certain provisions of the Sarbanes-Oxley Act as
well as other consulting services, and an increase in business
promotion of $3.7 million consistent with our strategy to increase
market share and grow the volume of our business. Personnel
expenses increased by $2.2 million due to higher salaries, the
in-sourcing of collection services and severance payments,
partially offset by a decrease in pension and other benefits and by
an increase in expenses deferred as loan origination costs.
Operating expenses decreased $2.4 million or 4.2% from $57.3
million for the quarter ended December 31, 2003 to $55.0 million
for the quarter ended December 31, 2004. This reduction was due
primarily to a decrease in EDP servicing, amortization and
technical services of $3.0 million due to lower servicing costs, a
decrease of $1.2 million in collections and related legal costs as
a result of in-sourcing of the collections function, a decrease of
$0.7 million in repossessed assets provisions and expenses and a
decrease in personnel costs of $0.7 million. These decreases were
partially offset by increases of $1.6 million in professional
services, partly associated with the implementation of certain
provisions of the Sarbanes-Oxley Act as well as other consulting
services, and an increase of $1.4 million in advertising and
promotion consistent with our strategy to increase market share and
grow the volume of our business. Balance Sheet Total assets as of
December 31, 2004 increased by $1.0 billion or 13.0% to $8.3
billion compared to $7.4 billion as of December 31, 2003. As of
December 31, 2004, there was an increase of $1.4 billion in net
loans, including loans held for sale (further explained below)
compared to December 31, 2003 balances. The increase in net loans
at December 31, 2004 when compared to December 31, 2003 was
partially offset by a decrease in investment securities of $508.0
million, an increase of $86.2 million in cash and cash equivalents,
a decrease of $8.3 million in premises and equipment due to the
sale of a building with a book value of approximately $7.7 million,
and normal depreciation for the period. There was also a decrease
of $22.3 million in other assets due primarily to a reduction in
net securities sold not delivered. As a result of strong commercial
activity and management's focus to regain market share, the net
loan portfolio, including loans held for sale, reflected an
increase of 33.0% or $1.4 billion, reaching $5.5 billion at
December 31, 2004, compared to the figures reported as of December
31, 2003. The mortgage loan portfolio grew $1.1 billion or 76.7%
during 2004 compared to the December 31, 2003 mortgage loan
portfolio. There was an 18.4% increase in mortgage loan production
for the year ended December 31, 2004 compared to the same period in
2003. The commercial loan portfolio (including construction loans)
and the consumer loan portfolio also reflected increases of $192.2
million or 8.6% and $50.1 million or 12.4%, respectively, as of
December 31, 2004, compared to December 31, 2003. Deposits at
December 31, 2004 reflected an increase of $605.9 million or 14.6%
compared to deposits of $4.1 billion as of December 31, 2003. This
increase was also in line with the objective of enhancing customer
activity and market share. Total borrowings at December 31, 2004
(comprised of federal funds purchased and other borrowings,
securities sold under agreements to repurchase, commercial paper
issued, term and capital notes) increased $268.3 million compared
to borrowings at December 31, 2003. Financial Strength
Non-performing loans to total loans as of December 31, 2004 was
1.57%, a 76 basis point improvement over the reported 2.33% as of
December 31, 2003, due to management actions on non performing loan
recoveries. Non-performing loans at December 31, 2004 amounted to
$87.5 million, an 11.0% improvement compared to $98.4 million as of
December 31, 2003. There had been an improving trend in this
indicator during 2003, which further continued throughout 2004. The
ratio of net charge-offs to average loans for the year ended
December 31, 2004 improved 37 basis points to 0.56% from 0.93%
reported for the year ended December 31, 2003. During 2004 there
was a decrease in net charge-offs of $10.3 million compared to
2003. Net charge-offs for the quarter ended December 31, 2004
decreased $2.8 million, or 31.6%, compared to the same period in
2003. The annualized ratio of net charge-offs to average loans for
the quarter ended December 31, 2004 improved 41 basis points to
0.45% from 0.86% for the same period in 2003. Management is
committed and has directed its efforts to continue improving this
ratio. The allowance for loan losses to total non-performing loans
at December 31, 2004 improved to 79.05% compared to 71.74% at
December 31, 2003. Excluding non-performing mortgage loans (for
which the Company has historically had a minimal loss experience)
this ratio is 135.0% compared to 123.9% as of December 31, 2003.
The allowance for loan losses represents 1.24% of total loans as of
December 31, 2004, a 41 basis point reduction over the 1.65%
reported as of December 31, 2003. The allowance for loan losses to
total loans excluding mortgage loans as of December 31, 2004 was
2.30%. As of December 31, 2004, total capital to risk-adjusted
assets (BIS ratio) reached 11.90% and Tier I capital to
risk-adjusted assets and leverage ratios were 9.27% and 6.36%,
respectively. Customer Financial Assets Under Control Santander
BanCorp is a client-focused organization that seeks to earn the
trust of customers to manage their financial assets. As of December
31, 2004, the Company had over $12.8 billion in Customer Financial
Assets Under Control, which represents a 20.2% or $2.2 billion
increase over balances as of December 31, 2003. This is a
significant part of the financial assets of Puerto Rico households
and reflects the Company's strong positioning in its primary
market. Customer Financial Assets Under Control include bank
deposits (excluding brokered deposits), broker-dealer customer
accounts, mutual fund assets managed, and trust, institutional and
private accounts under management. The growth in customer financial
assets and the stability of customer deposits is a strong
indication of the Company's successful efforts to regain market
share and reposition itself as a leading provider of financial
services. Shareholder Value On July 9, 2004 the Board of Directors
declared a 10% stock dividend to all shareholders of record as of
July 20, 2004. The common stock dividend was distributed on August
3, 2004. Cash was paid in lieu of fractional shares. The earnings
per share computations for all periods presented in the
accompanying financial information have been adjusted retroactively
to reflect this stock dividend. SBP common stock price per share
increased from $22.14 (after adjustment for the stock dividend) as
of December 31, 2003 to $30.16 as of December 31, 2004, an increase
of 36% or $374.2 million in market capitalization. During the
fourth quarter of 2004, Santander BanCorp declared a cash dividend
of 16 cents per common share to its shareholders of record as of
December 10, 2004, payable on January 3, 2005, resulting in a
current annualized dividend yield of 2.12%. There were no stock
repurchases during the last three quarters of 2003 and 2004 under
the Stock Repurchase Program. As of December 31, 2004, the Company
had acquired, as treasury stock, a total of 4,011,260 shares of
common stock, amounting to $67.6 million. Institutional Background
Santander BanCorp is a publicly held financial holding company that
is traded on the New York Stock Exchange and on Latibex (Madrid
Stock Exchange). It has three wholly owned subsidiaries, Banco
Santander Puerto Rico, Santander Securities Corporation and
Santander Insurance Agency. Banco Santander Puerto Rico has been
operating in Puerto Rico for 28 years. It offers a full array of
services through 65 branches in the areas of commercial, mortgage
and consumer banking, supported by a team of over 1,600 employees.
Santander Securities offers securities brokerage services and
provides portfolio management services through its wholly owned
subsidiary Santander Asset Management Corporation. Santander
Insurance Agency offers life, health and disability coverage as a
corporate agent and also operates as a general agent. For more
information, visit the Company's website at
http://www.santandernet.com/. Grupo Santander (SAN.MC, STD.N) ranks
among the top ten banks in the world and is the largest bank in the
Euro Zone by market capitalization. Founded in 1857, Grupo
Santander has 59 million clients and an extensive presence in more
than 40 countries, with over 10.000 offices. It is the first
Financial Group in Spain and Latin America and maintains an
important business activity in Europe, where it reached a prominent
presence in the United Kingdom through the acquisition of Abbey
National. Grupo Santander also owns the third largest banking group
in Portugal and Santander Consumer Finance, a leading consumer
finance franchise with presence in Germany, Italy and seven other
European countries. In Latin America, Grupo Santander maintains a
leading position where it manages over $114,000 million in business
volumes (loans, deposits and off- balance sheets under management)
has 4,052 offices in ten countries, serving more than 12 million
individual clients and approximately half a million small and
medium sized companies. As of the third quarter 2004, Grupo
Santander obtained a net attributable income of $1,225 million in
Latin America, an increase of over 8.8% over the same period last
year. Projected calendar for SBP reporting 2005 quarterly financial
results First quarter results - April 28, 2005 Second quarter
results- July 28, 2005 Third quarter results - October 27, 2005
Fourth quarter results - January 27, 2006 This news release
contains forward-looking statements that are based on current
expectations, estimates, forecasts and projections about the
industry in which the Company operates, its beliefs and its
management's assumptions. Words such as "expects," "anticipates,"
"targets," "goals," "projects," "intends," "plans," "believes,"
"seeks," "estimates" and variations of such words and similar
expressions are intended to identify such forward-looking
statements. These statements are not guarantees of future
performance and involve certain risks, uncertainties and
assumptions that are difficult to predict. Therefore, actual
outcomes and results may differ materially from what is expressed
or forecast in such forward-looking statements. Except as otherwise
required under federal securities laws and the rules and
regulations of the SEC, the Company does not have any intention or
obligation to update or revise any forward-looking statements,
whether as a result of new information, future events, changes in
assumptions or otherwise. (1) On a tax equivalent basis. (2) After
giving retroactive effect for the 10% stock dividend declared on
July 9, 2004. SANTANDER BANCORP UNAUDITED CONSOLIDATED BALANCE
SHEETS AS OF DECEMBER 31, 2004 AND 2003 (Dollars in thousands,
except per share data) ASSETS Variance 31-Dec-04 31-Dec-03
12/04-12/03 CASH AND CASH EQUIVALENTS: Cash and due from banks
$110,148 $99,183 11.06% Interest bearing deposits 42,612 15,300
178.51% Federal funds sold and securities purchased under
agreements to resell 326,650 278,750 17.18% Total cash and cash
equivalents 479,410 393,233 21.91% INTEREST BEARING DEPOSITS 50,000
10,000 400.00% TRADING SECURITIES 34,184 42,547 -19.66% INVESTMENT
SECURITIES AVAILABLE FOR SALE, at fair value 1,138,171 1,664,311
-31.61% INVESTMENT SECURITIES HELD TO MATURITY, at amortized cost
813,788 818,127 -0.53% OTHER INVESTMENT SECURITIES, at amortized
cost 37,500 15,000 150.00% LOANS HELD FOR SALE, net 271,596 297,201
-8.62% LOANS, net 5,311,936 3,917,566 35.59% ALLOWANCE FOR LOAN
LOSSES (69,177) (69,693) -0.74% PREMISES AND EQUIPMENT, net 52,854
61,107 -13.51% ACCRUED INTEREST RECEIVABLE 44,682 36,398 22.76%
GOODWILL 34,791 34,791 0.00% INTANGIBLE ASSETS 8,003 6,362 71.66%
OTHER ASSETS 118,076 140,350 -16.88% $8,325,814 $7,367,300 13.01%
LIABILITIES AND STOCKHOLDERS' EQUITY DEPOSITS: Non-interest bearing
$744,019 $700,413 6.23% Interest bearing 4,004,120 3,441,815 16.34%
Total deposits 4,748,139 4,142,228 14.63% FEDERAL FUNDS PURCHASED
AND OTHER BORROWINGS 780,334 350,000 122.95% SECURITIES SOLD UNDER
AGREEMENTS TO REPURCHASE 1,349,444 1,808,238 -25.37% COMMERCIAL
PAPER ISSUED 629,544 254,904 146.97% TERM NOTES 31,457 165,966
-81.05% CAPITAL NOTES 72,588 15,925 355.81% ACCRUED INTEREST
PAYABLE 22,666 18,728 21.03% OTHER LIABILITIES 151,605 130,479
16.19% 7,785,777 6,886,468 13.06% STOCKHOLDERS' EQUITY: Series A
Preferred stock, $25 par value; 10,000,000 shares authorized, none
issued or outstanding - - - Common stock, $2.50 par value;
200,000,000 shares authorized; 50,650,364 shares issued in December
2004 and 46,410,214 shares issued in December 2003; 46,639,104
shares outstanding in December 2004 and 42,398,954 shares
outstanding in December 2003 126,626 116,026 9.14% Capital paid in
excess of par value 304,171 211,742 43.65% Treasury stock at cost,
4,011,260 shares in December 2004 and 2003 (67,552) (67,552) 0.00%
Accumulated other comprehensive loss, net of taxes (22,784)
(19,465) 17.05% Retained earnings-Reserve fund 127,086 119,432
6.41% Undivided profits 72,490 120,649 -39.92% SANTANDER BANCORP
UNAUDITED CONSOLIDATED STATEMENTS OF INCOME FOR THE YEARS AND THE
QUARTERS ENDED DECEMBER 31, 2004 AND 2003 (Dollars in thousands,
except per share data) For the years For the quarters ended ended
December 31, December 31, 2004 2003 2004 2003 INTEREST INCOME:
Loans $257,852 $237,712 $72,857 $57,560 Investment securities
97,901 85,215 21,084 27,940 Interest bearing deposits 1,054 664 480
105 Federal funds sold and securities purchased under agreements to
resell 3,123 1,990 1,106 535 Total interest income 359,930 325,581
95,527 86,140 INTEREST EXPENSE: Deposits 60,279 56,030 18,164
13,107 Securities sold under agreements to repurchase and other
borrowings 79,901 75,896 21,213 18,247 Subordinated capital notes
582 425 528 30 Total interest expense 140,762 132,351 39,905 31,384
Net interest income 219,168 193,230 55,622 54,756 PROVISION FOR
LOAN LOSSES 26,270 49,745 4,500 15,000 Net interest income after
provision for loan losses 192,898 143,485 51,122 39,756 OTHER
INCOME: Bank service charges, fees and other 38,977 38,990 10,027
9,349 Broker/dealer, asset management and insurance fees 51,113
49,005 12,936 12,236 Gain on sale of securities 11,475 10,790 10
779 Gain on sale of mortgage servicing rights 400 457 116 131 Gain
on sale of loans 431 9,829 515 2,982 Gain on sale of building 2,754
- - - Other income 12,089 10,348 5,628 2,141 Total other income
117,239 119,419 29,232 27,618 OTHER OPERATING EXPENSES: Salaries
and employee benefits 91,582 89,394 22,544 23,201 Occupancy costs
13,959 13,534 3,850 3,416 Equipment expenses 6,946 7,291 1,629
1,674 EDP servicing, amortization and technical expenses 31,291
40,502 8,072 11,110 Communication expenses 8,976 8,612 2,183 2,336
Business promotion 10,435 6,760 3,294 1,849 Other taxes 8,584 9,811
2,010 2,286 Other operating expenses 45,760 47,840 11,372 11,464
Total other operating expenses 217,533 223,744 54,954 57,336 Income
before provision (benefit) for income tax 92,604 39,160 25,400
10,038 PROVISION (BENEFIT) FOR INCOME TAX 8,145 (285) 4,070 (5,704)
NET INCOME 84,459 39,445 21,330 15,742 DIVIDENDS TO PREFERRED
SHAREHOLDERS - 7,114 - 3,688 NET INCOME AVAILABLE TO COMMON
SHAREHOLDERS 84,459 32,331 21,330 12,054 EARNINGS PER COMMON SHARE*
$1.81 $0.69 $0.46 $0.26 * After giving retroactive effect to the
stock dividend declared on July 9, 2004 SANTANDER BANCORP Dec. 2004
2004 2004 Dec. 2003 Year to Fourth Third Year to Fourth SELECTED
RATIOS Date Quarter Quarter Date Quarter Net interest margin (1)
3.27% 3.24% 3.19% 3.30% 3.48% Return on average assets (2) 1.10%
1.08% 1.10% 0.59% 0.87% Return on average common equity (2) 16.90%
16.04% 17.14% 6.08% 8.89% Efficiency Ratio (1,3) 63.54% 60.48%
61.97% 70.05% 66.07% Non interest income to revenues 24.57% 23.43%
23.50% 26.84% 24.28% Capital: Total capital to risk- adjusted
assets - 11.90% 10.87% - 10.41% Tier I capital to risk- adjusted
assets - 9.27% 9.32% - 8.84% Leverage ratio - 6.36% 6.13% - 6.04%
Non-performing loans to total loans - 1.57% 1.84% - 2.33%
Non-performing loans plus accruing loans past-due 90 days or more
to loans - 1.63% 1.89% - 2.39% Allowance for loan losses to
non-performing loans - 79.05% 73.05% - 70.85% Allowance for loans
losses to period-end loans - 1.24% 1.34% - 1.65% OTHER SELECTED
FINANCIAL DATA 12/31/2004 12/31/2003 (dollars in millions) Customer
Financial Assets Under Control: Bank deposits (excluding brokered
deposits) $4,275.4 $3,782.8 Broker-dealer customer accounts 4,543.3
3,727.4 Mutual fund and assets managed 2,640.0 1,859.0 Trust,
institutional and private accounts assets under management 1,369.0
1,300.6 Total $12,827.7 $10,669.7 (1) On a tax-equivalent basis.
(2) Ratios for the quarters are annualized. (3) Operating expenses
divided by net interest income, on a tax equivalent basis, plus
other income, excluding gain on sale of securities (and gain on
sale of building for 1Q04). SANTANDER BANCORP SELECTED CONSOLIDATED
FINANCIAL INFORMATION: (DOLLARS IN THOUSANDS) For the Quarters
Ended Dec. 31, Dec. 31, Sept. 30, 4Q04/4Q03 4Q04/3Q04 2004 2003
2004 Variation Variation Interest Income $95,527 $86,140 $92,449
10.9% 3.3% Tax equivalent adjustment 6,022 5,184 5,025 16.2% 19.8%
Interest income on a tax equivalent basis 101,549 91,324 97,474
11.2% 4.2% Interest expense 39,905 31,384 36,510 27.2% 9.3% Net
interest income on a tax equivalent basis 61,644 59,940 60,964 2.8%
1.1% Provision for loan losses 4,500 15,000 7,020 -70.0% -35.9% Net
interest income on a tax equivalent basis after provision 57,144
44,940 53,944 27.2% 5.9% Other operating income 28,707 23,857
26,176 20.3% 9.7% Gain on sale of securities 10 779 2,462 -98.7%
-99.6% Gain on sale of loans 515 2,982 (240) -82.7% -314.6% Gain on
sale of building - - - N/A N/A Other operating expenses 54,954
57,336 53,851 -4.2% 2.0% Income on a tax equivalent basis before
income taxes 31,422 15,222 28,491 106.4% 10.3% Provision (credit)
for income taxes 4,070 (5,704) 1,597 -171.4% 154.9% Tax equivalent
adjustment 6,022 5,184 5,025 16.2% 19.8% NET INCOME (LOSS) $21,330
$15,742 $21,869 35.5% -2.5% SELECTED RATIOS: Per share data (1):
Earnings (loss) per common share $0.46 $0.26 $0.34 Average common
shares outstanding** 46,639,104 46,639,104 46,639,104 Common shares
outstanding at end of period** 46,639,104 46,639,104 46,639,104
Cash Dividends per Share: Preferred Stock* $- $0.41 $- Common Stock
$0.16 $0.11 $0.11 (1) Per share data is based on the average number
of shares outstanding during the period. Basic and diluted earnings
per share are the same. * Including redemption premium in Dec. 2003
** After giving retroactive effect to the stock dividend declared
on July 9, 2004 ** After giving retroactive effect to the stock
dividend declared on July 9, 2004 SANTANDER BANCORP SELECTED
CONSOLIDATED FINANCIAL INFORMATION: (DOLLARS IN THOUSANDS) Years
ended December 31, 2004 2003 Variation Interest Income $359,930
$325,581 10.6% Tax equivalent adjustment 20,162 17,550 14.9%
Interest income on a tax equivalent basis 380,092 343,131 10.8%
Interest expense 140,762 132,351 6.4% Net interest income on a tax
equivalent basis 239,330 210,780 13.5% Provision for loan losses
26,270 49,745 -47.2% Net interest income on a tax equivalent basis
after provision 213,060 161,035 32.3% Other operating income
102,579 98,800 3.8% Gain on sale of securities 11,475 10,790 -6.3%
Gain on sale of loans 431 9,829 95.6% Gain on sale of building
2,754 - N/A Other operating expenses 217,533 223,744 -2.8% Income
on a tax equivalent basis before income taxes 112,766 56,710 98.8%
Provision (credit) for income taxes 8,145 (285) -2957.9% Tax
equivalent adjustment 20,162 17,550 14.9% NET INCOME (LOSS) $84,459
$39,445 114.1% SELECTED RATIOS: Per share data (1): Earnings (loss)
per common share $1.81 $0.69 Average common shares outstanding**
46,639,104 46,661,248 Common shares outstanding at end of period**
46,639,104 46,639,104 Cash Dividends per Share: Preferred Stock* $-
$1.73 Common Stock $0.49 $0.44 (1) Per share data is based on the
average number of shares outstanding during the period. Basic and
diluted earnings per share are the same. * Including redemption
premium in Dec. 2003 ** After giving retroactive effect to the
stock dividend declared on July 9, 2004 ** After giving retroactive
effect to the stock dividend declared on July 9, 2004 DATASOURCE:
Santander BanCorp CONTACT: Maria Calero, +1-787-777-4437, or Evelyn
Vega, +1-787-777-4546, both of Santander BanCorp Web site:
http://www.santandernet.com/
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