News Column

EverBank Financial Corp Announces Full Year and Fourth Quarter 2013 Financial Results

January 29, 2014

JACKSONVILLE, Fla. --(BUSINESS WIRE)-- EverBank Financial Corp (NYSE: EVER) announced today its financial results for the fourth quarter and the year ended December 31, 2013. “2013 was a successful year for EverBank as we generated a solid return on equity, grew tangible book value per share by 12%, and executed on key strategic initiatives designed to enhance operating efficiency, simplify our earnings profile and focus on our core banking and lending activities,” said Robert M. Clements , chairman and chief executive officer. “The Company's fundamentals are strong, which we believe positions us to generate robust asset and earnings growth from our diverse nationwide lending businesses in 2014.” Adjusted net income was $32 million for the fourth quarter of 2013 1 , compared to $34 million for the third quarter 2013 and $44 million for the fourth quarter of 2012. For the year, adjusted net income was $148 million , an increase of 3% over 2012. GAAP net income was $18 million for the fourth quarter of 2013, compared to $33 million for the third quarter of 2013 and $29 million for the fourth quarter of 2012. For the year, GAAP net income was $137 million , an increase of 85% over 2012. Adjusted diluted earnings per share was $0.24 in the fourth quarter 2013, an 8% decrease from $0.26 in the third quarter 2013 and a 29% decrease from $0.34 in the fourth quarter 2012. GAAP diluted earnings per share was $0.13 , a 48% decrease from $0.25 in the third quarter 2013 and a 41% decrease from $0.22 in the fourth quarter 2012. For the full year 2013, adjusted diluted earnings per share was $1.11 , a 13% decrease from $1.27 in 2012. GAAP diluted earnings per share was $1.02 , a 70% increase from $0.60 in 2012. Fourth Quarter and Full Year 2013 Key Highlights Tangible common equity per common share was $11.57 at December 31, 2013, an increase of 12% compared to year end 2012. Adjusted return on equity (ROE) was 10% and GAAP ROE was 9% for the full year 2013. Retained asset generation of $1.6 billion for the fourth quarter, including commercial origination volume of $701 million , an increase of 45% and 99%, respectively, compared to the prior quarter. Deployed excess liquidity to grow portfolio loans held for investment to $13.3 billion , an increase of 5% compared to the prior quarter, or 22% annualized. Core net interest margin was 3.30% for the quarter, an increase of 13 basis points from 3.17% in the prior quarter. Adjusted non-performing assets were 0.65% of total assets at December 31, 2013 , a 36% decline compared to the prior quarter. Annualized net charge-offs to average loans and leases held for investment were 0.20% for the quarter. Strategic Business Activities Update During the fourth quarter, we continued to execute on our strategic plan of exiting non-core business activities and adjusting capacity in our mortgage banking and corporate services segments. We remain on track to close the sale of our default servicing platform to Green Tree Servicing LLC and expect the transfer date, in addition to the servicing sale date, to occur during the first quarter 2014. In anticipation of closing and transfer, we recognized $14 million of non-recurring costs in the quarter related to the transaction. Due to the normalization of industry refinance volumes and the expected first quarter 2014 default servicing platform transfer, we adjusted our residential lending, servicing and corporate administrative capacity, resulting in severance charges of $4 million and lease termination expense of $3 million . We closed on the sale of non-core commercial loans and REO for approximately $98 million . We recognized a $4 million loss on the sale during the quarter, however we expect to benefit from reduced noninterest expense associated with this portfolio in future periods. "We experienced strong portfolio loan growth in the quarter as retained origination volumes gained momentum across our core strategic business channels,” said W. Blake Wilson , president and chief operating officer. “We look forward to closing our servicing transaction with Green Tree in the first quarter and remain focused on driving efficiency throughout our organization while leveraging the investments we have made in recent years." 1 A reconciliation of Non-GAAP financial measures can be found in the financial tables attached hereto. Balance Sheet Strong Loan Portfolio Growth Total assets were $17.6 billion at December 31, 2013, flat compared to $17.6 billion at September 30, 2013. Consistent with our strategy to retain loans for our portfolio, total loans held for investment (HFI) increased $0.7 billion , or 5%, compared to the prior quarter, to $13.3 billion . Loans HFI for the fourth quarter were comprised of: ($ in millions) Dec 31 , 2013 Sep 30 , 2013 Dec 31 , 2012 % Change (Q/Q) % Change (Y/Y) Residential loans $ 5,153 $ 4,624 $ 3,949 11 % 30 % Mortgage pool buyouts 1,892 2,075 2,760 (9 )% (31 )% Total residential mortgages 7,045 6,699 6,709 5 % 5 % Commercial real estate 3,190 3,243 3,390 (2 )% (6 )% Commercial finance 1,917 1,607 1,248 19 % 54 % Total commercial finance & CRE 5,107 4,850 4,638 5 % 10 % Warehouse finance 944 851 970 11 % (3 )% Other 157 163 188 (4 )% (16 )% Total HFI $ 13,253 $ 12,563 $ 12,505 5 % 6 % During the fourth quarter, residential loans HFI increased by 11% compared to the prior quarter to $5.2 billion , driven by continued growth in our high quality prime jumbo hybrid ARM portfolio. Mortgage pool buyouts declined 9% to $1.9 billion compared to the prior quarter. Total commercial finance and CRE balances increased 5% compared to the prior quarter to $5.1 billion , driven by continued strength in our EverBank Commercial Finance platform. At December 31, 2013 our commercial platforms represented approximately 46% of loans HFI. Loan Origination Activities Organic asset generation totaled $2.7 billion and retained organic originations totaled $1.6 billion for the fourth quarter of 2013, a decrease of 12% and an increase of 45%, respectively, from the prior quarter. Total commercial originations for the fourth quarter increased 99% to $701 million , including commercial real estate and commercial finance originations of $266 million and $435 million , respectively. Residential loan originations were $2.0 billion for the fourth quarter, a decrease of 26% compared to the prior quarter and a decrease of 32% year over year. Excluding the impact of our exit from the wholesale broker channel in the third quarter, origination volume decreased 16% compared to the prior quarter and 11% year over year. Prime jumbo origination volume was $808 million for the fourth quarter, an increase of 5% compared to the prior quarter and 43% year over year. The mix of purchase transactions increased to 43% of total originations, compared to 40% in the prior quarter. Our gain on sale margin increased 120 basis points during the quarter to 2.88%, as we executed on our strategy to sell agency conforming originations and retain prime jumbo originations. The following table presents total organic loan and lease origination information by product type: ($ in millions) Dec 31 , 2013 Sep 30 , 2013 Dec 31 , 2012 % Change (Q/Q) % Change (Y/Y) Residential origination volume Conventional loans $ 1,188 $ 1,933 $ 2,373 (39 )% (50 )% Prime jumbo loans 808 767 567 5 % 43 % 1,996 2,700 2,940 (26 )% (32 )% Commercial origination volume Commercial real estate 266 122 132 118 % 102 % Commercial finance 435 223 195 95 % 123 % Warehouse finance — 7 35 NM NM 701 352 362 99 % 94 % Total organic originations $ 2,697 $ 3,052 $ 3,302 (12 )% (18 )% Deposit and Other Funding Sources Total deposits decreased by $0.4 billion , or 3%, to $13.3 billion at December 31, 2013, from $13.6 billion at September 30, 2013, and increased by $0.1 billion , or 1%, from $13.1 billion at December 31, 2012. At December 31, 2013, our deposits were comprised of the following: ($ in millions) Dec 31 , 2013 Sep 30 , 2013 Dec 31 , 2012 % Change (Q/Q) % Change (Y/Y) Noninterest-bearing demand $ 1,077 $ 1,366 $ 1,446 (21 )% (26 )% Interest-bearing demand 3,006 2,999 2,681 — % 12 % Savings and money market accounts 5,111 5,186 4,452 (1 )% 15 % Global market-based accounts 1,011 1,041 1,176 (3 )% (14 )% Time, excluding market-based 3,056 3,036 3,387 1 % (10 )% Total deposits $ 13,261 $ 13,628 $ 13,142 (3 )% 1 % Consumer deposits 11,434 11,864 11,602 (4 )% (1 )% Business deposits 1,827 1,764 1,540 4 % 19 % Total deposits $ 13,261 $ 13,628 $ 13,142 (3 )% 1 % Capital Strength Total shareholders' equity was $1.6 billion at December 31, 2013, compared to $1.6 billion at September 30, 2013. The bank’s Tier 1 leverage ratio was 9.0% and total risk-based capital ratio was 14.3% at December 31, 2013. As a result, the bank is considered "well-capitalized" under all applicable regulatory guidelines. Our current estimate of the fully phased-in Basel III common equity Tier 1 capital ratio at December 31, 2013 remained between 9.5% - 10.0%. Credit Quality Our adjusted non-performing assets were 0.65% of total assets at December 31, 2013, a decrease from 1.01% at September 30, 2013 and 1.08% at December 31, 2012 . We recorded a provision for loan and lease losses of $7 million during the fourth quarter of 2013, an increase of $4 million , or 129%, compared to the third quarter of 2013. The reduction in non-performing assets and increased provision in the quarter resulted from the non-core commercial asset sale that closed late in the fourth quarter. Net charge-offs during the fourth quarter of 2013 declined to $6 million from $10 million in the third quarter of 2013, a decline of 35%. On an annualized basis, net charge-offs for the fourth quarter were 0.20% of total average loans and leases held for investment, compared to 0.30% for the third quarter of 2013 and 0.16% for the fourth quarter of 2012. Income Statement Highlights Revenue Revenue for the fourth quarter was $231 million , a decrease of $52 million , or 18%, from $282 million in the third quarter 2013. The decline was driven primarily by lower gain on sale of loans and lower MSR valuation allowance recovery, offset by lower interest expense. Net Interest Income For the quarter, net interest income decreased by $4 million , or 3%, to $135 million . This decrease was attributable to lower interest income resulting from lower loans held for sale and investment securities average balances. Offsetting these was lower interest expense driven primarily by a decrease in FHLB advances average balance and rate. Core net interest margin, which is net interest margin excluding the impact of $3 million of Tygris acquisition excess accretion, increased to 3.30% for the fourth quarter from 3.17% in the third quarter. The increase was driven by a slight improvement in interest-earning asset yields resulting from higher commercial loan yields, in addition to lower average wholesale borrowing balances and rate. Noninterest Income Noninterest income for the fourth quarter of 2013 decreased by $48 million , or 33%, to $96 million compared to the third quarter of 2013. This decrease was driven by a $19 million decline in gain on sale of loans, a $20 million reduction in our MSR valuation allowance recovery, a $5 million decrease in loan production revenue and reduced other income. Noninterest Expense Noninterest expense for the fourth quarter of 2013 decreased by $29 million , or 13%, to $197 million from $226 million in the third quarter. Adjusted for the non-recurring expenses in the current and prior quarter outlined in the table below, noninterest expense decreased by $15 million , or 8%, to $173 million in the fourth quarter. General and administrative expense, excluding credit-related and consent order expense, decreased $6 million , or 16%, from the third quarter due to a $5 million decrease in other expense. Salaries, commissions and employee benefits decreased by $9 million , or 9%, due to lower staffing levels and lower variable costs related to origination activity levels. Occupancy and equipment expense increased $7 million , or 24%, driven by one-time expenses related to our default servicing platform sale and mortgage lending capacity adjustments. ($ in thousands) Dec 31 , 2013 Sep 30 , 2013 Dec 31 , 2012 Total noninterest expense $ 197,186 $ 225,696 $ 216,997 Non-recurring expenses Consent order expense 7,641 32,475 13,987 Severance 3,825 4,384 — Non-core commercial asset sale 999 — — Occupancy & equipment 7,935 843 — Other servicing sale costs 4,143 — — Total adjustments 24,543 37,702 13,987 Total NIE, ex-adjustments $ 172,643 $ 187,994 $ 203,010 Income Tax Expense Our effective tax rate for the fourth quarter of 2013 was 30%, compared to 38% for the third quarter of 2013 and 35% for the fourth quarter 2012. Segment Analysis for the Fourth Quarter of 2013 Banking and Wealth Management adjusted pre-tax income was $93 million , a 2% increase compared to the prior quarter driven by higher net interest income resulting from HFI loan growth, and lower noninterest expense, offset by lower noninterest income. Mortgage Banking had an adjusted pre-tax loss of $19 million , compared to an adjusted pre-tax loss of $14 million in the prior quarter driven by lower noninterest income partially offset by lower noninterest expense. Corporate Services had an adjusted pre-tax loss of $26 million , a 19% increase compared to the prior quarter driven by higher noninterest expense. Dividend On January 24, 2014 , the Company's Board of Directors declared a quarterly cash dividend of $0.03 per common share, payable on February 22, 2014 , to stockholders of record as of February 11, 2014 . Also on January 24, 2014 , the Company's Board of Directors declared a quarterly cash dividend of $421.875 , payable on April 7, 2014 , for each share of 6.75% Series A Non-Cumulative Perpetual Preferred Stock held as of March 21, 2014 . Conference Call and Webcast The Company will host a conference call at 8:30 a.m. Eastern Time on Wednesday, January 29, 2014 to discuss its full year and fourth quarter 2013 results. The dial-in number for the conference call is 1-866-652-5200 and the international dial-in number is 1-412-317-6060, passcode is 10039558. A live webcast of the conference call will also be available on the investor relations page of the Company's website at www.abouteverbank.com/ir . For those unable to participate in the conference call, a replay will be available from January 29, 2014 until February 5, 2014 . The replay dial-in number is 1-877-344-7529 and the international replay dial-in number is 1-412-317-0088, replay passcode is 10039558. About EverBank Financial Corp EverBank Financial Corp , through its wholly owned subsidiary EverBank , provides a diverse range of financial products and services directly to clients nationwide through multiple business channels. Headquartered in Jacksonville, Florida , EverBank has $17.6 billion in assets and $13.3 billion in deposits as of December 31, 2013. With an emphasis on value, innovation and service, EverBank offers a broad selection of banking, lending and investing products to consumers and businesses nationwide. EverBank provides services to clients through the internet, over the phone, through the mail, at its Florida -based financial centers and at other business offices throughout the country. More information on EverBank can be found at www.abouteverbank.com/ir . Forward Looking Statements This news release contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and such statements are intended to be covered by the safe harbor provided by the same. These statements may address issues that involve significant risks, uncertainties, estimates and assumptions made by management. Words such as “outlook,” “believes,” “expects,” “potential,” “continues,” “may,” “will,” “could,” “should,” “seeks,” “approximately,” “predicts,” “intends,” “plans,” “estimates,” “anticipates” or the negative version of those words or other comparable words are intended to identify forward-looking statements but are not the exclusive means of identifying such statements. These forward-looking statements are not historical facts, and are based on current expectations, estimates and projections about the Company’s asset growth and earnings, industry, management’s beliefs and certain assumptions made by management, many of which, by their nature, are inherently uncertain and beyond the Company’s control. Factors that could cause actual results to differ from those discussed in the forward-looking statements include, but are not limited to: deterioration of general business and economic conditions, including the real estate and financial markets, in the United States and in the geographic regions and communities we serve; risks related to liquidity; our capital and liquidity requirements (including under regulatory capital standards, such as Basel III capital standards) and our ability to generate or raise capital; changes in interest rates that affect the pricing of our financial products, the demand for our financial services and the valuation of our financial assets and liabilities, mortgage servicing rights and mortgages held for sale; risk of higher loan and lease charge-offs; legislative or regulatory actions affecting or concerning mortgage loan modification and refinancing and foreclosure; our ability to comply with any supervisory actions to which we are or become subject as a result of examination by our regulators; concentration of our commercial real estate loan portfolio; higher than normal delinquency and default rates; limited ability to rely on brokered deposits as a part of our funding strategy; our ability to comply with the amended consent order and the terms and conditions of our settlement of the Independent Foreclosure Review; concentration of mass-affluent clients and jumbo mortgages; hedging strategies; the effectiveness of our derivatives to manage interest rate risk; delinquencies on our equipment leases and reductions in the resale value of leased equipment; increases in loan repurchase requests and our reserves for loan repurchases; changes in currency exchange rates or other political or economic changes in certain foreign countries; loss of key personnel; fraudulent and negligent acts by loan applicants, mortgage brokers, other vendors and our employees; changes in and compliance with laws and regulations that govern our operations; failure to establish and maintain effective internal controls and procedures; effects of changes in existing U.S. government or government-sponsored mortgage programs; changes in laws and regulations that may restrict our ability to originate or increase our risk of liability with respect to certain mortgage loans; risks related to the approval and consummation of anticipated acquisitions; risks related to the continuing integration of acquired businesses and any future acquisitions; environmental liabilities with respect to properties that we take title to upon foreclosure; and the inability of our banking subsidiary to pay dividends. For additional factors that could materially affect our financial results, please refer to EverBank Financial Corp’s filings with the Securities and Exchange Commission , including but not limited to, the risks described under the headings “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” The Company undertakes no obligation to revise these statements following the date of this news release, except as required by law. EverBank Financial Corp and Subsidiaries Consolidated Balance Sheets (unaudited) (Dollars in thousands, except per share data) December 31 , 2013 December 31 , 2012 Assets Cash and due from banks $ 46,175 $ 175,400 Interest-bearing deposits in banks 801,603 268,514 Total cash and cash equivalents 847,778 443,914 Investment securities: Available for sale, at fair value 1,115,627 1,619,878 Held to maturity (fair value of $107,921 and $146,709 as of December 31, 2013 and 2012, respectively) 107,312 143,234 Other investments 128,063 158,172 Total investment securities 1,351,002 1,921,284 Loans held for sale (includes $672,371 and $1,452,236 carried at fair value as of December 31, 2013 and 2012, respectively) 791,382 2,088,046 Loans and leases held for investment: Loans and leases held for investment, net of unearned income 13,252,724 12,505,089 Allowance for loan and lease losses (63,690 ) (82,102 ) Total loans and leases held for investment, net 13,189,034 12,422,987 Equipment under operating leases, net 28,126 50,040 Mortgage servicing rights (MSR), net 506,680 375,859 Deferred income taxes, net 51,375 170,877 Premises and equipment, net 60,733 66,806 Other assets 814,874 703,065 Total Assets $ 17,640,984 $ 18,242,878 Liabilities Deposits: Noninterest-bearing $ 1,076,631 $ 1,445,783 Interest-bearing 12,184,709 11,696,605 Total deposits 13,261,340 13,142,388 Other borrowings 2,377,000 3,173,021 Trust preferred securities 103,750 103,750 Accounts payable and accrued liabilities 277,881 372,543 Total Liabilities 16,019,971 16,791,702 Commitments and Contingencies Shareholders’ Equity Series A 6.75% Non-Cumulative Perpetual Preferred Stock, $0.01 par value (liquidation preference of $25,000 per share; 10,000,000 shares authorized and 6,000 issued and outstanding at December 31, 2013 and 2012) 150,000 150,000 Common Stock, $0.01 par value (500,000,000 shares authorized at December 31, 2013 and 2012; 122,626,315 and 120,987,955 issued and outstanding at December 31, 2013 and 2012, respectively) 1,226 1,210 Additional paid-in capital 832,351 811,085 Retained earnings 690,051 575,665 Accumulated other comprehensive income (loss) (AOCI), net of benefit for income taxes of $32,224 and $53,193 at December 31, 2013 and 2012, respectively (52,615 ) (86,784 ) Total Shareholders’ Equity 1,621,013 1,451,176 Total Liabilities and Shareholders’ Equity $ 17,640,984 $ 18,242,878 EverBank Financial Corp and Subsidiaries Consolidated Statements of Income (unaudited) (Dollars in thousands, except per share data) Three Months Ended December 31 , Year Ended December 31 , 2013 2012 2013 2012 Interest Income Interest and fees on loans and leases $ 162,343 $ 173,619 $ 678,962 $ 574,443 Interest and dividends on investment securities 10,633 18,501 55,072 80,628 Other interest income 555 147 1,663 485 Total Interest Income 173,531 192,267 735,697 655,556 Interest Expense Deposits 23,925 24,901 101,752 88,785 Other borrowings 14,570 20,373 75,020 52,977 Total Interest Expense 38,495 45,274 176,772 141,762 Net Interest Income 135,036 146,993 558,925 513,794 Provision for Loan and Lease Losses 7,022 10,528 12,038 31,999 Net Interest Income after Provision for Loan and Lease Losses 128,014 136,465 546,887 481,795 Noninterest Income Loan servicing fee income 48,691 44,884 188,759 175,264 Amortization of mortgage servicing rights (25,342 ) (37,660 ) (126,803 ) (137,433 ) Recovery (impairment) of mortgage servicing rights 14,692 — 94,951 (63,508 ) Net loan servicing income (loss) 38,041 7,224 156,907 (25,677 ) Gain on sale of loans 32,867 85,681 242,412 289,532 Loan production revenue 5,920 16,841 35,986 44,658 Deposit fee income 3,917 4,712 19,084 21,450 Other lease income 5,293 8,570 24,681 33,158 Other 9,671 2,129 40,321 6,651 Total Noninterest Income 95,709 125,157 519,391 369,772 Noninterest Expense Salaries, commissions and other employee benefits expense 101,656 103,490 441,736 331,756 Equipment expense 24,752 20,445 85,920 70,856 Occupancy expense 11,481 7,596 35,087 25,581 General and administrative expense 59,297 85,466 285,495 307,377 Total Noninterest Expense 197,186 216,997 848,238 735,570 Income before Provision for Income Taxes 26,537 44,625 218,040 115,997 Provision for Income Taxes 8,086 15,779 81,300 41,955 Net Income $ 18,451 $ 28,846 $ 136,740 $ 74,042 Less: Net Income Allocated to Preferred Stock (2,531 ) (1,491 ) (10,125 ) (10,724 ) Net Income Allocated to Common Shareholders $ 15,920 $ 27,355 $ 126,615 $ 63,318 Basic Earnings Per Common Share $ 0.13 $ 0.23 $ 1.04 $ 0.61 Diluted Earnings Per Common Share $ 0.13 $ 0.22 $ 1.02 $ 0.60 Dividends Declared Per Common Share $ 0.03 $ 0.02 $ 0.10 $ 0.04 Non-GAAP Financial Measures This press release contains financial information and performance measures determined by methods other than in accordance with accounting principles generally accepted in the United States of America (“GAAP”). Adjusted Net Income, Adjusted Earnings Per Share, Adjusted Return on Equity, Adjusted Non-Performing Asset Ratio, Tangible Shareholders’ Equity, Tangible Common Shareholders' Equity, and Tangible Assets are non-GAAP financial measures. The Company’s management uses these measures to evaluate the underlying performance and efficiency of its operations. The Company’s management believes these non-GAAP measures provide meaningful additional information about the operating performance of the Company’s business and facilitate a meaningful comparison of our results in the current period to those in prior periods and future periods because these non-GAAP measures exclude certain items that may not be indicative of our core operating results and business outlook. In addition the Company’s management believes that certain of these non-GAAP measures represent a consistent benchmark against which to evaluate the Company’s growth, profitability and capital position. These non-GAAP measures are provided to enhance investors’ overall understanding of our current financial performance, and not as a substitute for, the Company’s reported results. Moreover, the manner in which we calculate these measures may differ from that of other companies reporting non-GAAP measures with similar names. In the tables below, we have provided a reconciliation of, where applicable, the most comparable GAAP financial measures and ratios to the non-GAAP financial measures and ratios used in this press release, or a reconciliation of the non-GAAP calculation of the financial measure for the periods indicated: EverBank Financial Corp and Subsidiaries Adjusted Net Income Three Months Ended (dollars in thousands, except per share data) Dec 31 , 2013 Sep 30 , 2013 Jun 30 , 2013 Mar 31 , 2013 Dec 31 , 2012 Net income $ 18,451 $ 33,150 $ 45,993 $ 39,146 $ 28,846 Transaction expense, net of tax — — — — 903 Non-recurring regulatory related expense, net of tax 4,807 20,203 12,042 11,425 9,564 Increase (decrease) in Bank of Florida non-accretable discount, net of tax (68 ) (439 ) (538 ) 950 486 Adoption of TDR guidance and policy change, net of tax — — — — 3,709 MSR impairment (recovery), net of tax (9,109 ) (21,783 ) (20,194 ) (7,784 ) — Restructuring cost, net of tax 16,090 3,242 — — — OTTI credit losses on investment securities (Volcker Rule), net of tax 2,045 — — — — Adjusted net income $ 32,216 $ 34,373 $ 37,303 $ 43,737 $ 43,508 Adjusted net income allocated to preferred stock 2,531 2,532 2,531 2,531 1,491 Adjusted net income allocated to common shareholders $ 29,685 $ 31,841 $ 34,772 $ 41,206 $ 42,017 Adjusted net earnings per common share, basic $ 0.24 $ 0.26 $ 0.28 $ 0.34 $ 0.35 Adjusted net earnings per common share, diluted $ 0.24 $ 0.26 $ 0.28 $ 0.33 $ 0.34 Weighted average common shares outstanding: (units in thousands) Basic 122,595 122,509 122,281 121,583 120,773 Diluted 124,420 124,124 124,034 123,439 122,807 Tangible Equity, Tangible Common Equity and Tangible Assets (dollars in thousands) Dec 31 , 2013 Sep 30 , 2013 Jun 30 , 2013 Mar 31 , 2013 Dec 31 , 2012 Shareholders’ equity $ 1,621,013 $ 1,602,913 $ 1,549,383 $ 1,504,442 $ 1,451,176 Less: Goodwill 46,859 46,859 46,859 46,859 46,859 Intangible assets 5,813 6,340 6,867 7,394 7,921 Tangible equity 1,568,341 1,549,714 1,495,657 1,450,189 1,396,396 Less: Perpetual preferred stock 150,000 150,000 150,000 150,000 150,000 Tangible common equity $ 1,418,341 $ 1,399,714 $ 1,345,657 $ 1,300,189 $ 1,246,396 Total assets $ 17,640,984 $ 17,612,089 $ 18,362,872 $ 18,306,488 $ 18,242,878 Less: Goodwill 46,859 46,859 46,859 46,859 46,859 Intangible assets 5,813 6,340 6,867 7,394 7,921 Tangible assets $ 17,588,312 $ 17,558,890 $ 18,309,146 $ 18,252,235 $ 18,188,098 Regulatory Capital (bank level) (dollars in thousands) Dec 31 , 2013 Sep 30 , 2013 Jun 30 , 2013 Mar 31 , 2013 Dec 31 , 2012 Shareholders’ equity $ 1,662,164 $ 1,648,152 $ 1,598,419 $ 1,560,001 $ 1,518,934 Less: Goodwill and other intangibles (51,072 ) (51,436 ) (51,807 ) (52,089 ) (54,780 ) Disallowed servicing asset (20,469 ) (39,658 ) (36,182 ) (31,585 ) (32,378 ) Disallowed deferred tax asset (63,749 ) (64,462 ) (65,406 ) (66,351 ) (67,296 ) Add: Accumulated losses on securities and cash flow hedges 50,608 54,392 78,181 77,073 83,477 Tier 1 capital 1,577,482 1,546,988 1,523,205 1,487,049 1,447,957 Add: Allowance for loan and lease losses 63,690 66,991 73,469 77,067 82,102 Total regulatory capital $ 1,641,172 $ 1,613,979 $ 1,596,674 $ 1,564,116 $ 1,530,059 Adjusted total assets $ 17,554,236 $ 17,510,528 $ 18,287,359 $ 18,234,886 $ 18,141,856 Risk-weighted assets 11,467,411 11,120,048 11,656,698 11,406,725 11,339,415 EverBank Financial Corp and Subsidiaries Non-Performing Assets (1) (dollars in thousands) December 31 , 2013 September 30 , 2013 June 30 , 2013 March 31 , 2013 December 31 , 2012 Non-accrual loans and leases: Residential mortgages $ 59,526 $ 60,066 $ 64,230 $ 69,876 $ 73,752 Commercial and commercial real estate 18,569 76,662 60,636 63,924 76,289 Lease financing receivables 4,527 4,171 2,601 2,791 2,010 Home equity lines 3,270 4,164 4,368 4,513 4,246 Consumer and credit card 18 15 243 364 332 Total non-accrual loans and leases 85,910 145,078 132,078 141,468 156,629 Accruing loans 90 days or more past due — — — — — Total non-performing loans (NPL) 85,910 145,078 132,078 141,468 156,629 Other real estate owned (OREO) 29,034 32,108 36,528 39,576 40,492 Total non-performing assets (NPA) 114,944 177,186 168,606 181,044 197,121 Troubled debt restructurings (TDR) less than 90 days past due 76,913 79,664 82,236 88,888 90,094 Total NPA and TDR (1) $ 191,857 $ 256,850 $ 250,842 $ 269,932 $ 287,215 Total NPA and TDR $ 191,857 $ 256,850 $ 250,842 $ 269,932 $ 287,215 Government-insured 90 days or more past due still accruing 1,039,541 1,147,795 1,405,848 1,547,995 1,729,877 Loans accounted for under ASC 310-30: 90 days or more past due 10,083 45,104 54,054 67,630 79,984 OREO — 21,240 21,194 22,955 16,528 Total regulatory NPA and TDR $ 1,241,481 $ 1,470,989 $ 1,731,938 $ 1,908,512 $ 2,113,604 Adjusted credit quality ratios excluding government-insured loans and loans accounted for under ASC 310-30: (1) NPL to total loans 0.61 % 1.07 % 0.89 % 0.97 % 1.08 % NPA to total assets 0.65 % 1.01 % 0.92 % 0.99 % 1.08 % NPA and TDR to total assets 1.09 % 1.46 % 1.37 % 1.47 % 1.57 % Credit quality ratios including government-insured loans and loans accounted for under ASC 310-30: NPL to total loans 8.12 % 9.87 % 10.76 % 12.04 % 13.55 % NPA to total assets 6.60 % 7.90 % 8.98 % 9.94 % 11.09 % NPA and TDR to total assets 7.04 % 8.35 % 9.43 % 10.43 % 11.59 % (1) We define non-performing assets, or NPA, as non-accrual loans, accruing loans past due 90 days or more and foreclosed property. Our NPA calculation excludes government-insured pool buyout loans for which payment is insured by the government. We also exclude loans and foreclosed property accounted for under ASC 310-30 because we expect to fully collect the carrying value of such loans and foreclosed property. EverBank Financial Corp and Subsidiaries Business Segments Selected Financial Information (dollars in thousands) Banking and Wealth Management Mortgage Banking Corporate Services Eliminations Consolidated Three Months Ended December 31, 2013 Net interest income $ 127,799 $ 8,815 $ (1,578 ) $ — $ 135,036 Provision for loan and lease losses 4,943 2,079 — — 7,022 Net interest income after provision for loan and lease losses 122,856 6,736 (1,578 ) — 128,014 Noninterest income 18,538 77,030 141 — 95,709 Noninterest expense: Foreclosure and OREO expense 3,399 5,787 — — 9,186 Other credit-related expenses 1,173 6,809 — — 7,982 All other noninterest expense 53,122 102,685 24,211 — 180,018 Income (loss) before income tax 83,700 (31,515 ) (25,648 ) — 26,537 Adjustment items (pre-tax): Decrease in Bank of Florida non-accretable discount (111 ) — — — (111 ) MSR impairment (recovery) — (14,692 ) — — (14,692 ) OTTI credit losses on investment securities (Volcker Rule) 3,298 — — — 3,298 Restructuring cost 6,432 19,700 (178 ) — 25,954 Transaction and non-recurring regulatory related expense — 7,669 84 — 7,753 Adjusted income (loss) before income tax 93,319 (18,838 ) (25,742 ) — 48,739 Total assets as of December 31, 2013 15,904,935 1,748,458 236,313 (248,722 ) 17,640,984 Three Months Ended September 30, 2013 Net interest income $ 125,545 $ 14,889 $ (1,578 ) $ — $ 138,856 Provision for loan and lease losses 1,216 1,852 — — 3,068 Net interest income after provision for loan and lease losses 124,329 13,037 (1,578 ) — 135,788 Noninterest income 32,937 110,479 153 — 143,569 Noninterest expense: Foreclosure and OREO expense 6,354 1,870 — — 8,224 Other credit-related expenses 533 3,099 — — 3,632 All other noninterest expense 60,341 132,312 21,187 — 213,840 Income (loss) before income tax 90,038 (13,765 ) (22,612 ) — 53,661 Adjustment items (pre-tax): Decrease in Bank of Florida non-accretable discount (708 ) — — — (708 ) MSR impairment (recovery) — (35,132 ) — — (35,132 ) Restructuring cost 1,901 2,527 799 — 5,227 Transaction and non-recurring regulatory related expense — 32,437 148 — 32,585 Adjusted income (loss) before income tax 91,231 (13,933 ) (21,665 ) — 55,633 Total assets as of September 30, 2013 15,502,004 2,106,162 213,745 (209,822 ) 17,612,089 Three Months Ended December 31, 2012 Net interest income $ 135,686 $ 12,531 $ (1,224 ) $ — $ 146,993 Provision for loan and lease losses 8,866 1,662 — — 10,528 Net interest income after provision for loan and lease losses 126,820 10,869 (1,224 ) — 136,465 Noninterest income 34,057 91,012 88 — 125,157 Noninterest expense: Foreclosure and OREO expense 7,246 1,572 — — 8,818 Other credit-related expenses 1,387 5,062 — — 6,449 All other noninterest expense 74,435 87,180 40,115 — 201,730 Income (loss) before income tax 77,809 8,067 (41,251 ) — 44,625 Adjustment items (pre-tax): Increase in Bank of Florida non-accretable discount 784 — — — 784 Adoption of TDR guidance and policy change 5,982 — — — 5,982 Transaction and non-recurring regulatory related expense — 12,276 4,606 — 16,882 Adjusted income (loss) before income tax 84,575 20,343 (36,645 ) — 68,273 Total assets as of December 31, 2012 16,119,927 2,127,100 166,234 (170,383 ) 18,242,878 EverBank Financial Corp Media Contact Michael Cosgrove , 904-623-2029 Michael.Cosgrove@EverBank.com or Investor Relations 877-755-6722 Investor.Relations@EverBank.com Source: EverBank Financial Corp


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