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Customers Bancorp (CUUU), led by Chairman and Chief Executive Jay Sidhu, has applied with the Federal Reserve Board to open an office at 99 Park Avenue in Manhattan.
April 2 -
Customers Bancorp, the Wyomissing, Pa., banking comany led by veteran banker Jay Sidhu, is giving up nearly 20% of its ownership to venture into the greater Washington, D.C., market.
June 21
Customers Bancorp in Wyomissing, Pa., has terminated its agreement to buy Acacia Federal Savings Bank in Falls Church, Va.
Customers
"This is a very strange regulatory environment we're in, and regulators have no propensity to take risks," Hogan said in an interview.
The $3.5 billion-asset company also reported Thursday that it earned a profit of $7.2 million in the first quarter, a 131% increase from the first quarter of 2012. Per-share earnings of 38 cents were 5 cents above the estimates of analysts polled by Bloomberg.
Customers' rising profit was driven by the growth of its balance sheet. Its total assets rose 75% and its net loans 101%, to $3 billion. Deposits rose by 41%, to $2.5 billion.
Still, there was one blemish in the earnings report. The company also disclosed that it had discovered a suspected fraud in its portfolio of loans held for sale in March. The possible fraud involves $5.2 million worth of loans, and the company estimates its losses could reach $3.2 million. It recorded a $2 million charge for this potential fraud in its first-quarter earnings.
Last month, a mortgage lender funded through Customers' warehouse-lending program confessed to the bank that it had been colluding with a title company to divert loans to other uses, Hogan said. Customers immediately took the matter to court and put liens on the property of the mortgage and the title companies as well as their guarantors. Hogan declined to identify either company.
"We expect to recover a good part of the money we lost, if not all of it, but that is a lengthy process and it will have to be decided through the courts," Hogan said. He expects the Federal Bureau of Investigation to bring charges against the two companies.
Customers also intends to list on a national exchange in the second quarter, it said Thursday. Its shares currently trade over the counter under the symbol CUUU.
Customers' net interest income grew along with its loan portfolio, rising 68%, to $22.5 million. Its provision for loan losses fell 39%, to $1.1 million, and chargeoffs fell 73%, to $562,000. Net interest margin widened by 25 basis points, to 3.25%.
Noninterest income rose 64%, to $6.1 million, primarily due to higher warehouse-lending and indemnification fees, the company said.
"We continued to build out our infrastructure to provide state of the art banking services to both our retail and business customers," said company Chairman and Chief Executive Jay Sidhu in the news release. "Despite a sluggish economy, we look forward to the remainder of 2013 with confidence in our ability to profitably deliver quality banking services to our customers."
