IRVINE, Calif.--(BUSINESS WIRE)--First Foundation Inc. (NASDAQ: FFWM), a financial services company with two wholly-owned operating subsidiaries, First Foundation Advisors (“FFA”) and First Foundation Bank (“FFB”), announced today its financial results for the quarter and year ended December 31, 2016.
"I am pleased with our results that reflect another strong year of growth for First Foundation,” said Scott F. Kavanaugh, CEO. “We experienced record loan production, solid deposit growth, and an uptick in our wealth management AUM. Our increases in total revenues by 43% and earnings by 74% are a testament to the strength of our platform, the quality of our employees, and our commitment to serving our clients and delivering value for our shareholders.”
- 2016 fourth quarter compared to 2015 fourth quarter:
- Earnings per fully diluted share were $0.19, an increase of 27%
- Earnings were $6.5 million, an increase of 29%
- Total revenues (net interest income and noninterest income) were $32.6 million, an increase of 22%
- Net interest income was $25.0 million, an increase of 43%
- 2016 compared to 2015:
- Earnings per fully diluted share were $0.70, an increase of 21%
- Earnings were $23.3 million, an increase of 74%
- Total revenues (net interest income and noninterest income) were $124.0 million, an increase of 43%
- Net interest income was $89.4 million, an increase of 54%
- Financial ratios:
- Efficiency ratio of 62.0% for the quarter and 65.3% for the year
- Return on average assets of 0.80% for the quarter and the year
- Return on average equity of 9.1% for the quarter and 8.4% for the year
- Total shareholders’ equity of $284 million and tangible book value of $8.62 per share, in each case, as of December 31, 2016
- Loan originations totaled $447 million for the fourth quarter and $1.77 billion for the year
- Deposits increased by $905 million for the year
- Assets under management (“AUM”) at FFA increased by $115 million for the year
“We were able to generate positive investment returns for our clients during a year characterized by unexpected events and challenging market conditions,” stated John Hakopian, President of FFA. “Our team remains focused on serving existing clients while also seeking new relationships that could benefit from our offering. As we head into 2017, we are seeing strong indicators of growth.”
Details of Growth
- Total loans, including loans held for sale, increased $1.04 billion during 2016 as a result of $1.77 billion of originations which was offset by the sale of $306 million of multifamily loans and payoffs or scheduled payments of $430 million.
- The $905 million growth in deposits during 2016 was broken down as follows: $362 million increase in noninterest bearing demand deposits; $66 million decrease in interest bearing demand deposits; $449 million increase in money market and savings accounts; and $159 million increase in certificate of deposit accounts.
- The $115 million growth in AUM for 2016 was the result of $321 million of new accounts and $221 million of portfolio gains which were partially offset by terminations of $279 million and net withdrawals of $148 million.
“Our growth in loans and deposits is a reflection of us beginning to realize the investments we have made in infrastructure over the past several quarters,” stated David DePillo, President of FFB. “We continue to focus on credit quality maintenance and optimizing operations to support our growth while delivering a valuable banking experience.”
As previously announced, First Foundation Bank acquired two branches located in Laguna Hills and Seal Beach, California with deposits of $179 million as of the closing date.
Additionally, as previously announced, effective January 18, 2017, the Company completed a two-for-one stock split in the form of a stock dividend. All share and per share amounts included in this news release have been adjusted to reflect the effect of this stock split.
About First Foundation
First Foundation, a financial institution founded in 1990, provides personal banking, business banking and private wealth management. The Company has offices in California, Nevada and Hawaii with headquarters in Irvine, California. For more information, please visit www.ff-inc.com.
We have two business segments, “Banking” and “Investment Management and Wealth Planning” (“Wealth Management”). Banking includes the operations of FFB and First Foundation Insurance Services, and Wealth Management includes the operations of FFA. The financial position and operating results of the stand-alone holding company, FFI, are included under the caption “Other” in certain of the tables that follow, along with any consolidation elimination entries.
Statements in this news release regarding our expectations and beliefs about our future financial performance and financial condition, as well as trends in our business and markets are "forward-looking statements" as defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements often include words such as "believe," "expect," "anticipate," "intend," "plan," "estimate," "project," or words of similar meaning, or future or conditional verbs such as "will," "would," "should," "could," or "may." The forward looking statements in this news release are based on current information and on assumptions that we make about future events and circumstances that are subject to a number of risks and uncertainties that are often difficult to predict and beyond our control. As a result of those risks and uncertainties, our actual financial results in the future could differ, possibly materially, from those expressed in or implied by the forward looking statements contained in this news release and could cause us to make changes to our future plans. Those risks and uncertainties include, but are not limited to, the risk of incurring loan losses, which is an inherent risk of the banking business; the risk that we will not be able to continue our internal growth rate; the risk that we will not be able to access the securitization market on favorable terms or at all; the risk that the economic recovery in the United States will stall or will be adversely affected by domestic or international economic conditions and risks associated with the Federal Reserve Board taking actions with respect to interest rates, any of which could adversely affect our interest income and interest rate margins and, therefore, our future operating results; the risk that the performance of our investment management business or of the equity and bond markets could lead clients to move their funds from or close their investment accounts with us, which would reduce our assets under management and adversely affect our operating results; risks associated with seeking new client relationships and maintaining existing client relationships. Additional information regarding these and other risks and uncertainties to which our business and future financial performance are subject is contained in Item 1A, entitled “Risk Factors” in our 2015 Annual Report on Form 10-K for the fiscal year ended December 31, 2015 that we filed with the SEC on March 15, 2016, and other documents we file with the SEC from time to time. We urge readers of this news release to review the Risk Factors section of that Annual Report and the Risk Factors section of other documents we file with the SEC from time to time. Also, our actual financial results in the future may differ from those currently expected due to additional risks and uncertainties of which we are not currently aware or which we do not currently view as, but in the future may become, material to our business or operating results. Due to these and other possible uncertainties and risks, readers are cautioned not to place undue reliance on the forward-looking statements contained in this news release, which speak only as of today's date, or to make predictions based solely on historical financial performance. We also disclaim any obligation to update forward-looking statements contained in this news release or in the above-referenced 2015 Annual Report on Form 10-K, whether as a result of new information, future events or otherwise, except as may be required by law or NASDAQ rules.
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