status is none of yer' damn business!! :-)
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Analyst: Fifth Third to benefit from stress test
Fifth Third shares soar as analyst says bank will likely benefit from government's stress test
Wednesday February 25, 2009, 4:46 pm EST
NEW YORK (AP) -- Shares of Fifth Third Bancorp soared more than 30 percent Wednesday after an analyst said the regional bank will likely be one of the biggest benefactors of the government's proposed stress test.
Shares of the Cincinnati-based bank jumped 49 cents, or 33.8 percent, to close at $1.94.
Fifth Third has been hit particularly hard by the housing and financial crises. Subsequently, its shares have taken a beating, falling 82 percent so far this year.
Fifth Third rose along with several battered bank stocks Wednesday after the Treasury Department said it would grant banks immediate access to more funds under the government's $700 billion financial rescue package. New support will be provided through the government's purchase of preferred shares of bank stock that are convertible into common shares at a 10 percent discount to their price before Feb. 9.
The Treasury Department also provided details of how a new stress test will function to ensure banks have enough capital to survive if the economy worsens. The stress tests will use two economic scenarios to gauge banks' health and are expected to be completed by the end of April.
According to Citi Investment Research analyst Keith Horowitz, Fifth Third stands to emerge as one of the biggest winners under either scenario. It's likely that the bank will not need to issue more equity, he said. However, "if they do need to, the conversion price is well above current prices."
"These stocks are pricing in significant dilution," Horowitz said. "We believe risk/reward is excellent at these levels."
Another damn nice call on FITB bud. Take a look at SFI fin's out today.
(SFI) iStar Financial Announces Fourth Quarter And Fiscal Year-End 2008 Results
- Total revenues were $289.9 million and $1.4 billion for the fourth quarter and fiscal year 2008, respectively.
- Company records $252.0 million of loan loss provisions during the quarter versus $411.1 million during the prior quarter.
- Adjusted earnings (loss) allocable to common shareholders for the fourth quarter and fiscal year were $12.7 million and ($352.0) million, respectively, or $0.10 and ($2.68) per diluted common share, respectively.
- Net income (loss) allocable to common shareholders for the fourth quarter and fiscal year were ($22.6) million and ($234.1) million, respectively, or ($0.18) and ($1.78) per diluted common share, respectively.
NEW YORK, Feb. 26 /PRNewswire-FirstCall/ -- iStar Financial Inc. (NYSE: SFI), a leading publicly traded finance company focused on the commercial real estate industry, today reported results for the fourth quarter and fiscal year ended December 31, 2008.
Fourth Quarter 2008 Results
iStar reported adjusted earnings (loss) allocable to common shareholders for the quarter of $12.7 million or $0.10 per diluted common share, compared with ($36.6) million or ($0.29) per diluted common share for the fourth quarter 2007. Adjusted earnings (loss) represent net income computed in accordance with GAAP, adjusted primarily for preferred dividends, depreciation, depletion, amortization, impairments of goodwill and intangible assets, hedge ineffectiveness and gain (loss) from discontinued operations.
Net income (loss) allocable to common shareholders for the fourth quarter was ($22.6) million, or ($0.18) per diluted common share, compared to ($78.7) million or ($0.62) per diluted common share for the fourth quarter 2007. Please see the financial tables that follow the text of this press release for a detailed reconciliation of adjusted earnings to GAAP net income.
Results for the quarter included $252.0 million of loan loss provisions, $150.0 million of impairments, $323.0 million of gains associated with the early extinguishment of debt and $19.0 million of gains from the sale of seven corporate tenant lease (CTL) assets. Gains on the sale of CTL assets are excluded from adjusted earnings, but included in net income.
Net investment income for the quarter was $435.4 million, compared to $218.5 million for the fourth quarter 2007. The increase is primarily due to gains associated with early extinguishment of debt. Net investment income represents interest income, operating lease income, earnings (loss) from equity method investments and gain (loss) on early extinguishment of debt, less interest expense and operating costs for corporate tenant lease assets.
During the quarter, the Company funded a total of $683.2 million under new and pre-existing commitments and received $730.0 million in gross principal repayments. Of the gross principal repayments, $278.9 million was utilized to pay down the A-participation interest associated with the Fremont portfolio.
The Company's equity represented 24.2% of total capitalization at quarter end versus 23.4% at the end of the prior quarter. The Company's leverage, calculated as book debt net of unrestricted cash and cash equivalents, divided by the sum of book equity, accumulated depreciation and loan loss reserves, each as determined in accordance with GAAP, was 3.1x at December 31, 2008 versus 3.3x at September 30, 2008.
The Company's net finance margin, calculated as the rate of return on assets less the cost of debt, was 2.15% for the quarter. Excluding the impact of the amortization of the Fremont portfolio purchase discount, the Company's net finance margin was 1.99% for the quarter, versus 2.74% in the prior quarter.
Fiscal Year 2008 Results
Adjusted earnings (loss) allocable to common shareholders for the year ended December 31, 2008, were ($352.0) million or ($2.68) per diluted common share. This compares to $347.8 million or $2.72 per diluted share for the year ended December 31, 2007.
Net income (loss) allocable to common shareholders for the year ended December 31, 2008, was ($234.1) million or ($1.78) per diluted common share, compared to $192.3 million or $1.51 per diluted common share for the year ended December 31, 2007.
Results for fiscal year 2008 included $1.0 billion of loan loss provisions, $334.8 million of impairments, $392.9 of gains associated with the early extinguishment of debt, $64.3 million of gains from sale of 49 CTL assets and $285.1 million of gains from the sale of the Company's timber investments, net of minority interest.
Net investment income and total revenue were $981.9 million and $1.4 billion, respectively, for the year ended December 31, 2008, versus $686.0 million and $1.4 billion, respectively, for the year ended December 31, 2007.
Capital Markets
The Company is currently working with members of its existing bank group and has received the requisite consents and commitments for a new secured facility and restructuring of existing bank facilities. The Company expects that, if completed, its principal amount of the new secured facility would be between $700 million and $1.0 billion. The Company currently has commitments of approximately $700 million.
If completed, the new secured facility would mature in June 2012 and would bear interest at a rate of LIBOR + 2.50%. Lenders who participate in the new secured loan would receive collateral security for their outstanding unsecured positions in the Company's existing unsecured bank lines and the interest on these loans would increase to LIBOR + 1.50%. The new facilities would also provide for additional operating flexibility through the modification of certain financial covenants.
The new secured facility and the restructuring of the existing facilities are currently expected to close in March. However, they are subject to closing conditions including the negotiation of definitive documents. There can be no assurance that these transactions will be completed in this timeframe or at all.
As of December 31, 2008, the Company had $558.1 million of unrestricted cash and available capacity under $3.7 billion in revolving credit facilities versus $877.7 million at the end of the prior quarter. The Company is currently in compliance with all of its bank and bond covenants.
During the quarter, the Company repurchased $635.9 million face amount of its unsecured bonds in open market transactions resulting in a gain of $323.0 million. In addition, the Company repurchased approximately 26.7 million shares of its common stock pursuant to its existing repurchase program.
Risk Management
At December 31, 2008, first mortgages, participations in first mortgages, senior loans and corporate tenant lease investments collectively comprised 91.5% of the Company's asset base, versus 90.7% in the prior quarter. The Company's loan portfolio consisted of 79.8% floating rate and 20.2% fixed rate loans, with a weighted average maturity of 2.3 years. Of the Company's floating rate loans, 62.3% had a weighted average floor of 3.99%.
The weighted average last dollar loan-to-value ratio for all structured finance assets was 75.8%. At quarter end, the Company's corporate tenant lease assets were 95.2% leased with a weighted average remaining lease term of 11.9 years. At December 31, 2008, the weighted average risk ratings of the Company's structured finance and corporate tenant lease assets were 3.53 and 2.58, respectively, versus 3.41 and 2.55, respectively, in the prior quarter.
As of December 31, 2008, 68 of the Company's 357 total loans were on non-performing loan (NPL) status. These loans represent $3.5 billion or 27.5% of total managed loans, compared to 51 loans representing $2.5 billion or 19.4% of total managed loans in the prior quarter. Managed asset and loan values represent iStar's book value plus the A-participation interest associated with the Fremont portfolio. The Company's total managed loan value at quarter end was $12.6 billion. The Company's policy is to stop the accrual of interest on loans placed on NPL status.
During the quarter, the Company sold two NPLs with managed asset value of $18.5 million and reclassified three loans with managed asset value of $71.7 million as other real estate owned (OREO).
At the end of the fourth quarter, the Company had 28 loans on its watch list representing $1.3 billion or 10.1% of total managed loans, compared to 29 loans representing $1.3 billion or 10.2% of total managed loans in the prior quarter. Assets on the Company's watch list are all performing loans.
At the end of the fourth quarter, the Company had 11 assets classified as OREO with a book value of $242.5 million. During the quarter, the Company took title to three properties that served as collateral on its loans, resulting in $30.7 million of charge-offs against the Company's reserve for loan losses. All of the loans were previously on NPL status and had a managed asset value of $71.7 million prior to the Company receiving title to the properties. The Company sold two OREO assets during the quarter, generating net proceeds of $61.4 million resulting in non-cash impairments of $3.1 million. In addition, the Company recorded $16.4 million of non-cash impairment charges on five OREO assets.
During the quarter, the Company recorded $109.9 million of non-cash impairment charges associated with five credits in its Corporate Loan and Debt portfolio and its Other Investments.
At December 31, 2008, the Company had $976.8 million in loan loss reserves versus $832.7 million at September 30, 2008, consisting of $177.2 million of general reserves and $799.6 million of asset specific reserves. The provisions reflect the severe deterioration in the overall credit markets and its impact on the portfolio as determined in the Company's regular quarterly risk ratings review process performed following the end of the quarter.
The Company's total loss coverage, defined as the combination of loan loss reserves of $976.8 million and remaining unamortized purchase discount from the Fremont acquisition of $55.9 million, was $1.0 billion or 8.2% of total managed loans at the end of the fourth quarter. This compares to total loss coverage of $908.2 million or 7.1% of total managed loans in the prior quarter.
Summary of Fremont Contributions to Quarterly Results
At the end of the fourth quarter, the Fremont portfolio, including additional fundings made during the quarter, had a managed asset value of $4.0 billion consisting of 140 loans versus $4.3 billion consisting of 152 loans at the end of the third quarter 2008.
At the end of the fourth quarter, the value of the A-participation interest in the portfolio was $1.3 billion versus $1.6 billion on September 30, 2008. The book value of iStar's B-participation interest at the end of the fourth quarter was $2.7 billion versus $2.7 billion on September 30, 2008. During the quarter, iStar received $398.4 million in principal repayments, of which the Company retained 30%. The balance of principal repayments was paid to the A-participation interest. The current weighted average maturity of the Fremont portfolio is eight months.
During the fourth quarter, iStar funded $218.6 million of commitments related to the portfolio. Unfunded commitments at the end of the fourth quarter were $0.7 billion, of which the Company expects to fund approximately $0.4 billion based upon its comprehensive review of the portfolio. This compares to unfunded commitments of $0.9 billion at the end of the prior quarter.
At December 31, 2008, there were 37 Fremont loans on NPL status with a managed asset value of $1.2 billion versus 29 loans at the prior quarter end, with $777.8 million of managed asset value. In addition, there were 18 loans on the Company's watch list with a managed asset value of $758.6 million versus 14 loans at the prior quarter end, with $578.1 million of managed asset value.
Earnings Guidance and Dividend Expectations
Given the continued uncertainty in the market, the Company will not be providing guidance for fiscal year 2009 at this time.
The Company's Board of Directors has concluded that the Company has already paid out 100% of its 2008 taxable income. As a result, the Company will not pay a fourth quarter cash dividend on its common shares. For the year, the Company has paid a total of $1.74 per share in common share dividends.
[Financial Tables to Follow]
* * *
iStar Financial Inc. is a leading publicly traded finance company focused on the commercial real estate industry. The Company primarily provides custom-tailored investment capital to high-end private and corporate owners of real estate, including senior and mezzanine real estate debt, senior and mezzanine corporate capital, as well as corporate net lease financing and equity. The Company, which is taxed as a real estate investment trust ("REIT"), seeks to generate attractive risk-adjusted returns on equity to shareholders by providing innovative and value-added financing to its customers.
iStar Financial will hold a quarterly earnings conference call at 10:00 a.m. ET today, February 26, 2009. This conference call will be broadcast live over the Internet and can be accessed by all interested parties through iStar Financial's website, www.istarfinancial.com, under the "Investor Relations" section. To listen to the live call, please go to the website's "Investor Relations" section at least 15 minutes prior to the start of the call to register, download and install any necessary audio software. For those who are not available to listen to the live broadcast, a replay will be available shortly after the call on the iStar Financial website.
(Note: Statements in this press release which are not historical fact may be deemed forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Although iStar Financial Inc. believes the expectations reflected in any forward-looking statements are based on reasonable assumptions, the Company can give no assurance that its expectations will be attained. Factors that could cause actual results to differ materially from iStar Financial Inc.'s expectations include, but are not limited to, completion of pending investments, continued ability to originate new investments, the mix of originations between structured finance and corporate tenant lease assets, repayment levels, the timing of receipt of prepayment penalties, the availability and cost of capital for future investments, competition within the finance and real estate industries, economic conditions, loss experience and other risks detailed from time to time in iStar Financial Inc.'s periodic reports filed with the Securities and Exchange Commission, including the annual reports on Form 10-K and quarterly reports on Form 10-Q.)
Selected Income Statement Data
(In thousands)
(unaudited)
Three Months Ended Twelve Months Ended
December 31, December 31,
2008 2007 2008 2007
---- ---- ---- ----
Net investment income (1) $435,395 $218,516 $981,880 $685,953
Other income 9,144 20,530 97,851 99,938
Non-interest expense (2) (477,404) (315,960) (1,642,656) (580,868)
Minority interest in
consolidated entities (78) 514 991 816
Gain on sale of joint venture
interest, net of minority
interest - - 261,659 -
-------- -------- --------- --------
Income (loss) from continuing
operations (32,943) (76,400) (300,275) 205,839
Income from discontinued
operations 1,455 6,546 15,715 25,287
Gain from discontinued
operations, net of minority
interest 18,971 9 87,769 7,832
Preferred dividends (10,580) (10,580) (42,320) (42,320)
-------- -------- --------- --------
Net income (loss) allocable to
common shareholders and HPU
holders (3) ($23,097) ($80,425) ($239,111) $196,638
======== ======== ========= ========
(1) Includes interest income, operating lease income, earnings (loss) from
equity method investments and gain (loss) on early extinguishment of
debt, less interest expense and operating costs for corporate tenant
lease assets.
(2) Includes depreciation and amortization, general and administrative
expenses, provision for loan losses, impairments and other expense.
(3) HPU holders are Company employees who purchased high performance
common stock units under the Company's High Performance Unit Program.
Selected Balance Sheet Data
(In thousands)
(unaudited) As of As of
December 31, 2008 December 31, 2007
----------------- -----------------
Loans and other lending
investments, net $10,586,644 $10,949,354
Corporate tenant lease
assets, net 3,044,811 3,309,866
Other investments 447,318 856,609
Total assets 15,296,748 15,848,298
Debt obligations 12,516,023 12,399,558
Total liabilities 12,870,515 12,894,869
Total shareholders' equity 2,389,380 2,899,481
iStar Financial Inc.
Consolidated Statements of Operations
(In thousands, except per share amounts)
(unaudited)
Three Months Ended Twelve Months Ended
December 31, December 31,
2008 2007 2008 2007
---- ---- ---- ----
REVENUES
Interest income $199,201 $308,128 $947,661 $998,008
Operating lease income 81,564 81,622 318,600 314,740
Other income 9,144 20,530 97,851 99,938
-------- -------- --------- ---------
Total revenues 289,909 410,280 1,364,112 1,412,686
-------- -------- --------- ---------
COSTS AND EXPENSES
Interest expense 161,153 186,643 660,284 627,720
Operating costs - corporate
tenant lease assets 8,401 7,894 23,575 28,926
Depreciation and amortization 24,734 24,442 97,368 86,223
General and administrative (1) 34,765 36,950 159,096 165,128
Provision for loan losses 252,020 113,000 1,029,322 185,000
Impairment of goodwill - - 39,092 -
Impairment of other assets 149,972 144,184 295,738 144,184
Other expense 15,913 (2,616) 22,040 333
-------- -------- --------- ---------
Total costs and expenses 646,958 510,497 2,326,515 1,237,514
-------- -------- --------- ---------
Income (loss) from
continuing operations
before other items (357,049) (100,217) (962,403) 175,172
Gain on early
extinguishment of debt 323,027 225 392,943 225
Gain on sale of joint
venture interest, net of
minority interest - - 261,659 -
Earnings (loss) from
equity method investments 1,157 23,078 6,535 29,626
Minority interest
in consolidated entities (78) 514 991 816
-------- -------- --------- ---------
Income (loss) from continuing
operations (32,943) (76,400) (300,275) 205,839
Income from discontinued
operations 1,455 6,546 15,715 25,287
Gain from discontinued
operations, net of
minority interest 18,971 9 87,769 7,832
-------- -------- --------- ---------
Net income (loss) (12,517) (69,845) (196,791) 238,958
Preferred dividend
requirements (10,580) (10,580) (42,320) (42,320)
-------- -------- --------- ---------
Net income (loss) allocable
to common shareholders
and HPU holders ($23,097) ($80,425) ($239,111) $196,638
======== ======== ========= =========
Net income (loss) per
common share
Basic ($0.18) ($0.62) ($1.78) $1.52
Diluted (2) ($0.18) ($0.62) ($1.78) $1.51
Net income (loss)
per HPU share
Basic (3) ($34.80) ($116.93) ($336.33) $287.93
Diluted (2)(4) ($34.80) ($116.47) ($336.33) $285.00
(1) For the three months ended December 31, 2008 and 2007, includes
$5,817 and $5,549 of stock-based compensation expense, respectively.
For the years ended December 31, 2008 and 2007, includes $23,542 and
$17,601 of stock-based compensation expense, respectively.
(2) For the year ended December 31, 2007, includes the allocable share of
$85 joint venture income.
(3) For the three months ended December 31, 2008 and 2007, ($522) and
($1,754) of net income (loss) is allocable to HPU holders,
respectively. For the years ended December 31, 2008 and 2007, ($5,045)
and $4,319 of net income (loss) is allocable to HPU holders,
respectively.
(4) For the three months ended December 31, 2008 and 2007, ($522) and
($1,747) of net income (loss) is allocable to HPU holders,
respectively. For the years ended December 31, 2008 and 2007, ($5,045)
and $4,275 of net income (loss) is allocable to HPU holders,
respectively.
iStar Financial Inc.
Earnings Per Share Information
(In thousands, except per share amounts)
(unaudited)
Three Months Ended Twelve Months Ended
December 31, December 31,
2008 2007 2008 2007
---- ---- ---- ----
EPS INFORMATION FOR COMMON SHARES
Income (loss) from continuing
operations per common share (1)
Basic ($0.34) ($0.67) ($2.56) $1.26
Diluted (2) ($0.34) ($0.67) ($2.56) $1.26
Net income (loss) per common share
Basic ($0.18) ($0.62) ($1.78) $1.52
Diluted (2) ($0.18) ($0.62) ($1.78) $1.51
Weighted average common shares
outstanding
Basic 122,809 127,267 131,153 126,801
Diluted 122,809 127,798 131,153 127,792
EPS INFORMATION FOR HPU SHARES
Income (loss) from continuing
operations per HPU share (1)
Basic ($65.60) ($126.46) ($482.46) $239.60
Diluted (2) ($65.60) ($125.94) ($482.46) $237.07
Net income (loss) per HPU share (3)
Basic ($34.80) ($116.93) ($336.33) $287.93
Diluted (2) ($34.80) ($116.47) ($336.33) $285.00
Weighted average HPU shares
outstanding
Basic and diluted 15 15 15 15
(1) For the three months ended December 31, 2008 and 2007, excludes
preferred dividends of $10,580. For the years ended December 31, 2008
and 2007, excludes preferred dividends of $42,320.
(2) For the year ended December 31, 2007, includes the allocable share of
$85 of joint venture income.
(3) As more fully explained in the Company's quarterly SEC filings, three
plans of the Company's HPU program vested in December 2002, December
2003 and December 2004. Each of the respective plans contain 5 HPU
shares. Cumulatively, these 15 shares were entitled to ($522) and
($1,754) of net income (loss) for the three months ended December 31,
2008 and 2007, respectively, and ($5,045) and $4,319 of net income
(loss) for the years ended December 31, 2008 and 2007, respectively.
On a diluted basis, these cumulative 15 shares were entitled to ($522)
and ($1,747) of net income (loss) for the three months ended December
31, 2008 and 2007, respectively, and ($5,045) and $4,275 of net income
(loss) for the years ended December 31, 2008 and 2007, respectively.
iStar Financial Inc.
Reconciliation of Adjusted Earnings to GAAP Net Income
(In thousands, except per share amounts)
(unaudited)
Three Months Ended Twelve Months Ended
December 31, December 31,
2008 2007 2008 2007
---- ---- ---- ----
ADJUSTED EARNINGS (1)
Net income (loss) ($12,517) ($69,845) ($196,791) $238,958
Add: Depreciation, depletion
and amortization 24,596 28,254 102,745 99,427
Add: Joint venture depreciation,
depletion and amortization 1,953 9,834 14,466 40,826
Add: Amortization of
deferred financing costs 9,907 8,145 43,800 28,367
Add: Impairment of goodwill
and intangible assets 9,069 - 60,618 -
Less: Hedge ineffectiveness, net 9,533 (3,183) 7,427 (239)
Less: Gain from discontinued
operations, net of minority
interest (18,971) (9) (87,769) (7,832)
Less: Gain on sale of joint
venture interest, net of
minority interest - - (261,659) (1,572)
Less: Preferred dividends (10,580) (10,580) (42,320) (42,320)
------- ------- ------- -------
Adjusted earnings (loss) allocable
to common shareholders and HPU
holders:
Basic $12,990 ($37,384) ($359,483) $355,615
Diluted $12,992 ($37,384) ($359,483) $355,707
Adjusted earnings (loss) per
common share:
Basic (2) $0.10 ($0.29) ($2.68) $2.74
Diluted (3) $0.10 ($0.29) ($2.68) $2.72
Weighted average common
shares outstanding:
Basic 122,809 127,267 131,153 126,801
Diluted 123,800 127,798 131,153 127,792
Common shares outstanding
at end of period:
Basic 105,457 133,929 105,457 133,929
Diluted 105,457 134,465 105,457 134,465
(1) Adjusted earnings should be examined in conjunction with net income as
shown in the Consolidated Statements of Operations. Adjusted earnings
should not be considered as an alternative to net income (determined
in accordance with GAAP) as an indicator of the Company's performance,
or to cash flows from operating activities (determined in accordance
with GAAP) as a measure of the Company's liquidity, nor is this
measure indicative of funds available to fund the Company's cash needs
or available for distribution to shareholders. Rather, adjusted
earnings is an additional measure the Company uses to analyze how its
business is performing. It should be noted that the Company's manner
of calculating adjusted earnings may differ from the calculations of
similarly-titled measures by other companies.
(2) For the three months ended December 31, 2008 and 2007, excludes $293
and ($816) of net income (loss) allocable to HPU holders,
respectively. For the years ended December 31, 2008 and 2007,
excludes ($7,461) and $7,799 of net income (loss) allocable to HPU
holders, respectively.
(3) For the three months ended December 31, 2008 and 2007, excludes $291
and ($812) of net income (loss) allocable to HPU holders,
respectively. For the years ended December 31, 2008 and 2007,
excludes ($7,461) and $7,730 of net income (loss) allocable to HPU
holders, respectively.
iStar Financial Inc.
Consolidated Balance Sheets
(In thousands)
As of As of
December 31, 2008 December 31, 2007
----------------- -----------------
(unaudited)
ASSETS
Loans and other lending investments, net $10,586,644 $10,949,354
Corporate tenant lease assets, net 3,044,811 3,309,866
Other investments 447,318 856,609
Other real estate owned 242,505 128,558
Assets held for sale - 74,335
Cash and cash equivalents 496,537 104,507
Restricted cash 155,965 32,977
Accrued interest and operating lease
income receivable, net 87,151 121,405
Deferred operating lease income receivable 116,793 102,135
Deferred expenses and other assets, net 114,838 125,274
Goodwill 4,186 43,278
----------- -----------
Total assets $15,296,748 $15,848,298
=========== ===========
LIABILITIES AND SHAREHOLDERS' EQUITY
Accounts payable, accrued expenses
and other liabilities $354,492 $495,311
Debt obligations:
Unsecured senior notes 7,218,160 7,916,853
Unsecured revolving credit facilities 3,281,273 2,681,174
Secured revolving credit facility 306,867 -
Interim financing facility - 1,289,811
Secured term loans 1,611,650 413,682
Other debt obligations 98,073 98,038
----------- -----------
Total liabilities 12,870,515 12,894,869
Minority interest in consolidated entities 36,853 53,948
Shareholders' equity 2,389,380 2,899,481
----------- -----------
Total liabilities and
shareholders' equity $15,296,748 $15,848,298
=========== ===========
iStar Financial Inc.
Supplemental Information
(In thousands)
(unaudited)
PERFORMANCE STATISTICS Three Months Ended
December 31, 2008
-----------------
Net Finance Margin
------------------
Weighted average GAAP yield of loan and CTL investments 7.44%
Less: Cost of debt 5.29%
----------
Net Finance Margin (1) 2.15%
Net Finance Margin Excluding Amortization of Discount
on Fremont Loans 1.99%
Return on Average Common Book Equity
------------------------------------
Average total book equity $2,421,731
Less: Average book value of preferred equity (506,176)
----------
Average common book equity (A) $1,915,555
Net income (loss) allocable to common
shareholders and HPU holders ($23,097)
Net income (loss) allocable to common
shareholders and HPU holders - Annualized (B) ($92,388)
Return on Average Common Book Equity (B) / (A) (4.8%)
Adjusted basic earnings (loss) allocable to
common shareholders and HPU holders (2) $12,990
Adjusted basic earnings (loss) allocable to
common shareholders and HPU holders - Annualized (C) $51,960
Adjusted Return on Average Common Book Equity (C) / (A) 2.7%
Expense Ratio
-------------
General and administrative expenses (3) (D) $34,693
Total revenue (3) (E) $291,731
Expense Ratio (D) / (E) 11.9%
(1) Weighted average GAAP yield is the annualized sum of interest income
and operating lease income, divided by the sum of average gross
corporate tenant lease assets, average loans and other lending
investments, average SFAS No. 141 purchase intangibles and average
assets held for sale over the period. Cost of debt is the annualized
sum of interest expense and operating costs-corporate tenant lease
assets, divided by the average gross debt obligations over the period.
Operating lease income and operating costs-corporate tenant lease
assets exclude SFAS No. 144 adjustments from discontinued operations
of $1,822 and $127, respectively. The Company does not consider net
finance margin to be a measure of the Company's liquidity or cash
flows. It is one of several measures that management considers to be
an indicator of the profitability of its operations.
(2) Adjusted earnings should be examined in conjunction with net income
(loss) as shown in the Consolidated Statements of Operations. Adjusted
earnings should not be considered as an alternative to net income
(loss) (determined in accordance with GAAP) as an indicator of the
Company's performance, or to cash flows from operating activities
(determined in accordance with GAAP) as a measure of the Company's
liquidity, nor is this measure indicative of funds available to fund
the Company's cash needs or available for distribution to
shareholders. Rather, adjusted earnings is an additional measure the
Company uses to analyze how its business is performing. It should be
noted that the Company's manner of calculating adjusted earnings may
differ from the calculations of similarly-titled measures by other
companies.
(3) Total revenue and general and administrative expenses exclude SFAS
No. 144 adjustments from discontinued operations of $1,822 and ($72),
respectively.
iStar Financial Inc.
Supplemental Information
(In thousands)
(unaudited)
CREDIT STATISTICS Three Months Ended
December 31, 2008
-----------------
Book debt, net of unrestricted cash (A) $12,019,486
Book equity 2,389,380
Add: Accumulated depreciation and loan loss reserves 1,456,371
-----------
Sum of book equity, accumulated depreciation and
loan loss reserves (B) $3,845,751
Leverage (1) (A) / (B) 3.1x
Ratio of Earnings (Loss) to Fixed Charges 0.8x
Ratio of Earnings (Loss) to Fixed Charges and
Preferred Stock Dividends 0.8x
Covenant Calculation of Fixed Charge Coverage Ratio (2) 2.7x
Interest Coverage
-----------------
EBITDA (3) (C) $175,185
GAAP interest expense (D) 161,153
EBITDA / GAAP Interest Expense (3) (C) / (D) 1.1x
RECONCILIATION OF NET INCOME TO EBITDA (3)
Net income (loss) ($12,517)
Add: GAAP interest expense 161,153
Add: Depreciation, depletion and amortization 24,596
Add: Joint venture depreciation, depletion and amortization 1,953
-----------
EBITDA (3) $175,185
(1) Leverage is calculated by dividing book debt net of unrestricted cash
by the sum of book equity, accumulated depreciation and loan loss
reserves.
(2) This measure, which is a trailing twelve-month calculation and
excludes the effect of impairment charges and other non-cash items, is
consistent with covenant calculations included in the Company's
unsecured credit facilities; therefore, we believe it is a useful
measure for investors to consider.
(3) EBITDA should be examined in conjunction with net income (loss) as
shown in the Consolidated Statements of Operations. EBITDA should not
be considered as an alternative to net income (loss) (determined in
accordance with GAAP) as an indicator of the Company's performance, or
to cash flows from operating activities (determined in accordance with
GAAP) as a measure of the Company's liquidity, nor is this measure
indicative of funds available to fund the Company's cash needs or
available for distribution to shareholders. It should be noted that
the Company's manner of calculating EBITDA may differ from the
calculations of similarly-titled measures by other companies.
iStar Financial Inc.
Supplemental Information
(In thousands)
(unaudited)
FINANCING VOLUME SUMMARY STATISTICS
Three Months Ended
December 31, 2008 LOAN ORIGINATIONS
------------------------------
Total/
Floating Weighted CORPORATE OTHER
Fixed Rate Rate Average LEASING INVESTMENTS
---------- -------- -------- --------- -----------
Amount funded $23,216 $622,458 $645,674 $9,411 $28,152
Weighted average
GAAP yield 5.91% 7.37% 7.31% 11.78% N/A
Weighted average
all-in spread/margin
(basis points) (1) 568 665 661 N/A N/A
Weighted average
first $ loan-to-value
ratio 45.07% 0.86% 2.36% N/A N/A
Weighted average
last $ loan-to-value
ratio 84.39% 75.10% 75.42% N/A N/A
UNFUNDED COMMITMENTS
Number of assets with unfunded commitments 194
Discretionary commitments $163,393
Non-discretionary commitments 2,263,966
-------------------
Total unfunded commitments $2,427,359
Estimated weighted average funding period Approximately 2.1 years
UNENCUMBERED ASSETS / UNSECURED DEBT
Unencumbered assets (A) $13,540,138
Unsecured debt (B) $10,612,225
Unencumbered Assets / Unsecured Debt (A) / (B) 1.3x
RISK MANAGEMENT STATISTICS
(weighted average
risk rating) 2008 2007
--------------------------------------------- ------------
December 31, September 30, June 30, March 31, December 31,
------------ ------------- -------- --------- ------------
Structured
Finance Assets
(principal risk) 3.53 3.41 3.28 3.12 3.07
Corporate Tenant
Lease Assets 2.58 2.55 2.55 2.51 2.50
(1=lowest risk; 5=highest risk)
(1) Represents spread over base rate LIBOR (floating-rate loans) and
interpolated U.S. Treasury rates (fixed-rate loans) during the
quarter.
iStar Financial Inc.
Supplemental Information
(In thousands, except per share amounts)
(unaudited)
LOANS AND OTHER LENDING INVESTMENTS CREDIT STATISTICS
As of
------------------------------------
December 31, 2008 December 31, 2007
----------------- -----------------
Value of non-performing loans (1) /
As a percentage of total managed
loans $3,458,157 27.48% $1,193,669 8.71%
Reserve for loan losses /
As a percentage of total managed
loans $976,788 7.76% $217,910 1.59%
As a percentage of non-performing
loans (1) 28.25% 18.26%
(1) Non-performing loans include iStar's book value and Fremont's
A-participation interest on the associated assets.
iStar Financial Inc.
Supplemental Information
(In millions)
(unaudited)
PORTFOLIO STATISTICS December 31, 2008 (1)
Asset Type
----------
First Mortgages / Senior Loans $10,670 68.4%
Corporate Tenant Leases 3,597 23.1
Mezzanine / Subordinated Debt 893 5.7
Other Investments 434 2.8
------- -----
Total $15,594 100.0%
======= =====
Property / Collateral Type
--------------------------
Apartment / Residential $4,244 27.2%
Land 2,359 15.1
Office 1,895 12.1
Industrial / R&D 1,489 9.5
Retail 1,348 8.7
Entertainment / Leisure 967 6.2
Corporate - Real Estate 868 5.6
Hotel 821 5.3
Mixed Use / Mixed Collateral 641 4.1
Other 582 3.7
Corporate - Non-Real Estate 380 2.5
------- -----
Total $15,594 100.0%
======= =====
Geography
---------
West $3,581 23.0%
Northeast 2,843 18.2
Southeast 2,659 17.1
Mid-Atlantic 1,672 10.7
Central 927 6.0
Southwest 923 5.9
Various 892 5.7
International 797 5.1
South 515 3.3
Northcentral 435 2.8
Northwest 350 2.2
------- -----
Total $15,594 100.0%
======= =====
(1) Figures presented prior to loan loss reserves, accumulated
depreciation and impact of Statement of Financial Accounting Standards
No. 141, "Business Combinations."
SOURCE iStar Financial Inc. -0- 02/26/2009
CONTACT:
Catherine D. Rice,
Chief Financial Officer,
or
Andrew G. Backman,
Senior Vice President - Investor Relations,
both of iStar Financial Inc.,
+1-212-930-9400
iStar Financial Announces Fourth Quarter And Fiscal Year-End 2008 Results
- Total revenues were $289.9 million and $1.4 billion for the fourth quarter and fiscal year 2008, respectively.
- Company records $252.0 million of loan loss provisions during the quarter versus $411.1 million during the prior quarter.
- Adjusted earnings (loss) allocable to common shareholders for the fourth quarter and fiscal year were $12.7 million and ($352.0) million, respectively, or $0.10 and ($2.68) per diluted common share, respectively.
- Net income (loss) allocable to common shareholders for the fourth quarter and fiscal year were ($22.6) million and ($234.1) million, respectively, or ($0.18) and ($1.78) per diluted common share, respectively.
NEW YORK, Feb. 26 /PRNewswire-FirstCall/ -- iStar Financial Inc. (NYSE: SFI), a leading publicly traded finance company focused on the commercial real estate industry, today reported results for the fourth quarter and fiscal year ended December 31, 2008.
Fourth Quarter 2008 Results
iStar reported adjusted earnings (loss) allocable to common shareholders for the quarter of $12.7 million or $0.10 per diluted common share, compared with ($36.6) million or ($0.29) per diluted common share for the fourth quarter 2007. Adjusted earnings (loss) represent net income computed in accordance with GAAP, adjusted primarily for preferred dividends, depreciation, depletion, amortization, impairments of goodwill and intangible assets, hedge ineffectiveness and gain (loss) from discontinued operations.
Net income (loss) allocable to common shareholders for the fourth quarter was ($22.6) million, or ($0.18) per diluted common share, compared to ($78.7) million or ($0.62) per diluted common share for the fourth quarter 2007. Please see the financial tables that follow the text of this press release for a detailed reconciliation of adjusted earnings to GAAP net income.
Results for the quarter included $252.0 million of loan loss provisions, $150.0 million of impairments, $323.0 million of gains associated with the early extinguishment of debt and $19.0 million of gains from the sale of seven corporate tenant lease (CTL) assets. Gains on the sale of CTL assets are excluded from adjusted earnings, but included in net income.
Net investment income for the quarter was $435.4 million, compared to $218.5 million for the fourth quarter 2007. The increase is primarily due to gains associated with early extinguishment of debt. Net investment income represents interest income, operating lease income, earnings (loss) from equity method investments and gain (loss) on early extinguishment of debt, less interest expense and operating costs for corporate tenant lease assets.
During the quarter, the Company funded a total of $683.2 million under new and pre-existing commitments and received $730.0 million in gross principal repayments. Of the gross principal repayments, $278.9 million was utilized to pay down the A-participation interest associated with the Fremont portfolio.
The Company's equity represented 24.2% of total capitalization at quarter end versus 23.4% at the end of the prior quarter. The Company's leverage, calculated as book debt net of unrestricted cash and cash equivalents, divided by the sum of book equity, accumulated depreciation and loan loss reserves, each as determined in accordance with GAAP, was 3.1x at December 31, 2008 versus 3.3x at September 30, 2008.
The Company's net finance margin, calculated as the rate of return on assets less the cost of debt, was 2.15% for the quarter. Excluding the impact of the amortization of the Fremont portfolio purchase discount, the Company's net finance margin was 1.99% for the quarter, versus 2.74% in the prior quarter.
Fiscal Year 2008 Results
Adjusted earnings (loss) allocable to common shareholders for the year ended December 31, 2008, were ($352.0) million or ($2.68) per diluted common share. This compares to $347.8 million or $2.72 per diluted share for the year ended December 31, 2007.
Net income (loss) allocable to common shareholders for the year ended December 31, 2008, was ($234.1) million or ($1.78) per diluted common share, compared to $192.3 million or $1.51 per diluted common share for the year ended December 31, 2007.
Results for fiscal year 2008 included $1.0 billion of loan loss provisions, $334.8 million of impairments, $392.9 of gains associated with the early extinguishment of debt, $64.3 million of gains from sale of 49 CTL assets and $285.1 million of gains from the sale of the Company's timber investments, net of minority interest.
Net investment income and total revenue were $981.9 million and $1.4 billion, respectively, for the year ended December 31, 2008, versus $686.0 million and $1.4 billion, respectively, for the year ended December 31, 2007.
Capital Markets
The Company is currently working with members of its existing bank group and has received the requisite consents and commitments for a new secured facility and restructuring of existing bank facilities. The Company expects that, if completed, its principal amount of the new secured facility would be between $700 million and $1.0 billion. The Company currently has commitments of approximately $700 million.
If completed, the new secured facility would mature in June 2012 and would bear interest at a rate of LIBOR + 2.50%. Lenders who participate in the new secured loan would receive collateral security for their outstanding unsecured positions in the Company's existing unsecured bank lines and the interest on these loans would increase to LIBOR + 1.50%. The new facilities would also provide for additional operating flexibility through the modification of certain financial covenants.
The new secured facility and the restructuring of the existing facilities are currently expected to close in March. However, they are subject to closing conditions including the negotiation of definitive documents. There can be no assurance that these transactions will be completed in this timeframe or at all.
As of December 31, 2008, the Company had $558.1 million of unrestricted cash and available capacity under $3.7 billion in revolving credit facilities versus $877.7 million at the end of the prior quarter. The Company is currently in compliance with all of its bank and bond covenants.
During the quarter, the Company repurchased $635.9 million face amount of its unsecured bonds in open market transactions resulting in a gain of $323.0 million. In addition, the Company repurchased approximately 26.7 million shares of its common stock pursuant to its existing repurchase program.
Risk Management
At December 31, 2008, first mortgages, participations in first mortgages, senior loans and corporate tenant lease investments collectively comprised 91.5% of the Company's asset base, versus 90.7% in the prior quarter. The Company's loan portfolio consisted of 79.8% floating rate and 20.2% fixed rate loans, with a weighted average maturity of 2.3 years. Of the Company's floating rate loans, 62.3% had a weighted average floor of 3.99%.
The weighted average last dollar loan-to-value ratio for all structured finance assets was 75.8%. At quarter end, the Company's corporate tenant lease assets were 95.2% leased with a weighted average remaining lease term of 11.9 years. At December 31, 2008, the weighted average risk ratings of the Company's structured finance and corporate tenant lease assets were 3.53 and 2.58, respectively, versus 3.41 and 2.55, respectively, in the prior quarter.
As of December 31, 2008, 68 of the Company's 357 total loans were on non-performing loan (NPL) status. These loans represent $3.5 billion or 27.5% of total managed loans, compared to 51 loans representing $2.5 billion or 19.4% of total managed loans in the prior quarter. Managed asset and loan values represent iStar's book value plus the A-participation interest associated with the Fremont portfolio. The Company's total managed loan value at quarter end was $12.6 billion. The Company's policy is to stop the accrual of interest on loans placed on NPL status.
During the quarter, the Company sold two NPLs with managed asset value of $18.5 million and reclassified three loans with managed asset value of $71.7 million as other real estate owned (OREO).
At the end of the fourth quarter, the Company had 28 loans on its watch list representing $1.3 billion or 10.1% of total managed loans, compared to 29 loans representing $1.3 billion or 10.2% of total managed loans in the prior quarter. Assets on the Company's watch list are all performing loans.
At the end of the fourth quarter, the Company had 11 assets classified as OREO with a book value of $242.5 million. During the quarter, the Company took title to three properties that served as collateral on its loans, resulting in $30.7 million of charge-offs against the Company's reserve for loan losses. All of the loans were previously on NPL status and had a managed asset value of $71.7 million prior to the Company receiving title to the properties. The Company sold two OREO assets during the quarter, generating net proceeds of $61.4 million resulting in non-cash impairments of $3.1 million. In addition, the Company recorded $16.4 million of non-cash impairment charges on five OREO assets.
During the quarter, the Company recorded $109.9 million of non-cash impairment charges associated with five credits in its Corporate Loan and Debt portfolio and its Other Investments.
At December 31, 2008, the Company had $976.8 million in loan loss reserves versus $832.7 million at September 30, 2008, consisting of $177.2 million of general reserves and $799.6 million of asset specific reserves. The provisions reflect the severe deterioration in the overall credit markets and its impact on the portfolio as determined in the Company's regular quarterly risk ratings review process performed following the end of the quarter.
The Company's total loss coverage, defined as the combination of loan loss reserves of $976.8 million and remaining unamortized purchase discount from the Fremont acquisition of $55.9 million, was $1.0 billion or 8.2% of total managed loans at the end of the fourth quarter. This compares to total loss coverage of $908.2 million or 7.1% of total managed loans in the prior quarter.
Summary of Fremont Contributions to Quarterly Results
At the end of the fourth quarter, the Fremont portfolio, including additional fundings made during the quarter, had a managed asset value of $4.0 billion consisting of 140 loans versus $4.3 billion consisting of 152 loans at the end of the third quarter 2008.
At the end of the fourth quarter, the value of the A-participation interest in the portfolio was $1.3 billion versus $1.6 billion on September 30, 2008. The book value of iStar's B-participation interest at the end of the fourth quarter was $2.7 billion versus $2.7 billion on September 30, 2008. During the quarter, iStar received $398.4 million in principal repayments, of which the Company retained 30%. The balance of principal repayments was paid to the A-participation interest. The current weighted average maturity of the Fremont portfolio is eight months.
During the fourth quarter, iStar funded $218.6 million of commitments related to the portfolio. Unfunded commitments at the end of the fourth quarter were $0.7 billion, of which the Company expects to fund approximately $0.4 billion based upon its comprehensive review of the portfolio. This compares to unfunded commitments of $0.9 billion at the end of the prior quarter.
At December 31, 2008, there were 37 Fremont loans on NPL status with a managed asset value of $1.2 billion versus 29 loans at the prior quarter end, with $777.8 million of managed asset value. In addition, there were 18 loans on the Company's watch list with a managed asset value of $758.6 million versus 14 loans at the prior quarter end, with $578.1 million of managed asset value.
Earnings Guidance and Dividend Expectations
Given the continued uncertainty in the market, the Company will not be providing guidance for fiscal year 2009 at this time.
The Company's Board of Directors has concluded that the Company has already paid out 100% of its 2008 taxable income. As a result, the Company will not pay a fourth quarter cash dividend on its common shares. For the year, the Company has paid a total of $1.74 per share in common share dividends.
[Financial Tables to Follow]
* * *
iStar Financial Inc. is a leading publicly traded finance company focused on the commercial real estate industry. The Company primarily provides custom-tailored investment capital to high-end private and corporate owners of real estate, including senior and mezzanine real estate debt, senior and mezzanine corporate capital, as well as corporate net lease financing and equity. The Company, which is taxed as a real estate investment trust ("REIT"), seeks to generate attractive risk-adjusted returns on equity to shareholders by providing innovative and value-added financing to its customers.
iStar Financial will hold a quarterly earnings conference call at 10:00 a.m. ET today, February 26, 2009. This conference call will be broadcast live over the Internet and can be accessed by all interested parties through iStar Financial's website, www.istarfinancial.com, under the "Investor Relations" section. To listen to the live call, please go to the website's "Investor Relations" section at least 15 minutes prior to the start of the call to register, download and install any necessary audio software. For those who are not available to listen to the live broadcast, a replay will be available shortly after the call on the iStar Financial website.
(Note: Statements in this press release which are not historical fact may be deemed forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Although iStar Financial Inc. believes the expectations reflected in any forward-looking statements are based on reasonable assumptions, the Company can give no assurance that its expectations will be attained. Factors that could cause actual results to differ materially from iStar Financial Inc.'s expectations include, but are not limited to, completion of pending investments, continued ability to originate new investments, the mix of originations between structured finance and corporate tenant lease assets, repayment levels, the timing of receipt of prepayment penalties, the availability and cost of capital for future investments, competition within the finance and real estate industries, economic conditions, loss experience and other risks detailed from time to time in iStar Financial Inc.'s periodic reports filed with the Securities and Exchange Commission, including the annual reports on Form 10-K and quarterly reports on Form 10-Q.)
Selected Income Statement Data
(In thousands)
(unaudited)
Three Months Ended Twelve Months Ended
December 31, December 31,
2008 2007 2008 2007
---- ---- ---- ----
Net investment income (1) $435,395 $218,516 $981,880 $685,953
Other income 9,144 20,530 97,851 99,938
Non-interest expense (2) (477,404) (315,960) (1,642,656) (580,868)
Minority interest in
consolidated entities (78) 514 991 816
Gain on sale of joint venture
interest, net of minority
interest - - 261,659 -
-------- -------- --------- --------
Income (loss) from continuing
operations (32,943) (76,400) (300,275) 205,839
Income from discontinued
operations 1,455 6,546 15,715 25,287
Gain from discontinued
operations, net of minority
interest 18,971 9 87,769 7,832
Preferred dividends (10,580) (10,580) (42,320) (42,320)
-------- -------- --------- --------
Net income (loss) allocable to
common shareholders and HPU
holders (3) ($23,097) ($80,425) ($239,111) $196,638
======== ======== ========= ========
(1) Includes interest income, operating lease income, earnings (loss) from
equity method investments and gain (loss) on early extinguishment of
debt, less interest expense and operating costs for corporate tenant
lease assets.
(2) Includes depreciation and amortization, general and administrative
expenses, provision for loan losses, impairments and other expense.
(3) HPU holders are Company employees who purchased high performance
common stock units under the Company's High Performance Unit Program.
Selected Balance Sheet Data
(In thousands)
(unaudited) As of As of
December 31, 2008 December 31, 2007
----------------- -----------------
Loans and other lending
investments, net $10,586,644 $10,949,354
Corporate tenant lease
assets, net 3,044,811 3,309,866
Other investments 447,318 856,609
Total assets 15,296,748 15,848,298
Debt obligations 12,516,023 12,399,558
Total liabilities 12,870,515 12,894,869
Total shareholders' equity 2,389,380 2,899,481
iStar Financial Inc.
Consolidated Statements of Operations
(In thousands, except per share amounts)
(unaudited)
Three Months Ended Twelve Months Ended
December 31, December 31,
2008 2007 2008 2007
---- ---- ---- ----
REVENUES
Interest income $199,201 $308,128 $947,661 $998,008
Operating lease income 81,564 81,622 318,600 314,740
Other income 9,144 20,530 97,851 99,938
-------- -------- --------- ---------
Total revenues 289,909 410,280 1,364,112 1,412,686
-------- -------- --------- ---------
COSTS AND EXPENSES
Interest expense 161,153 186,643 660,284 627,720
Operating costs - corporate
tenant lease assets 8,401 7,894 23,575 28,926
Depreciation and amortization 24,734 24,442 97,368 86,223
General and administrative (1) 34,765 36,950 159,096 165,128
Provision for loan losses 252,020 113,000 1,029,322 185,000
Impairment of goodwill - - 39,092 -
Impairment of other assets 149,972 144,184 295,738 144,184
Other expense 15,913 (2,616) 22,040 333
-------- -------- --------- ---------
Total costs and expenses 646,958 510,497 2,326,515 1,237,514
-------- -------- --------- ---------
Income (loss) from
continuing operations
before other items (357,049) (100,217) (962,403) 175,172
Gain on early
extinguishment of debt 323,027 225 392,943 225
Gain on sale of joint
venture interest, net of
minority interest - - 261,659 -
Earnings (loss) from
equity method investments 1,157 23,078 6,535 29,626
Minority interest
in consolidated entities (78) 514 991 816
-------- -------- --------- ---------
Income (loss) from continuing
operations (32,943) (76,400) (300,275) 205,839
Income from discontinued
operations 1,455 6,546 15,715 25,287
Gain from discontinued
operations, net of
minority interest 18,971 9 87,769 7,832
-------- -------- --------- ---------
Net income (loss) (12,517) (69,845) (196,791) 238,958
Preferred dividend
requirements (10,580) (10,580) (42,320) (42,320)
-------- -------- --------- ---------
Net income (loss) allocable
to common shareholders
and HPU holders ($23,097) ($80,425) ($239,111) $196,638
======== ======== ========= =========
Net income (loss) per
common share
Basic ($0.18) ($0.62) ($1.78) $1.52
Diluted (2) ($0.18) ($0.62) ($1.78) $1.51
Net income (loss)
per HPU share
Basic (3) ($34.80) ($116.93) ($336.33) $287.93
Diluted (2)(4) ($34.80) ($116.47) ($336.33) $285.00
(1) For the three months ended December 31, 2008 and 2007, includes
$5,817 and $5,549 of stock-based compensation expense, respectively.
For the years ended December 31, 2008 and 2007, includes $23,542 and
$17,601 of stock-based compensation expense, respectively.
(2) For the year ended December 31, 2007, includes the allocable share of
$85 joint venture income.
(3) For the three months ended December 31, 2008 and 2007, ($522) and
($1,754) of net income (loss) is allocable to HPU holders,
respectively. For the years ended December 31, 2008 and 2007, ($5,045)
and $4,319 of net income (loss) is allocable to HPU holders,
respectively.
(4) For the three months ended December 31, 2008 and 2007, ($522) and
($1,747) of net income (loss) is allocable to HPU holders,
respectively. For the years ended December 31, 2008 and 2007, ($5,045)
and $4,275 of net income (loss) is allocable to HPU holders,
respectively.
iStar Financial Inc.
Earnings Per Share Information
(In thousands, except per share amounts)
(unaudited)
Three Months Ended Twelve Months Ended
December 31, December 31,
2008 2007 2008 2007
---- ---- ---- ----
EPS INFORMATION FOR COMMON SHARES
Income (loss) from continuing
operations per common share (1)
Basic ($0.34) ($0.67) ($2.56) $1.26
Diluted (2) ($0.34) ($0.67) ($2.56) $1.26
Net income (loss) per common share
Basic ($0.18) ($0.62) ($1.78) $1.52
Diluted (2) ($0.18) ($0.62) ($1.78) $1.51
Weighted average common shares
outstanding
Basic 122,809 127,267 131,153 126,801
Diluted 122,809 127,798 131,153 127,792
EPS INFORMATION FOR HPU SHARES
Income (loss) from continuing
operations per HPU share (1)
Basic ($65.60) ($126.46) ($482.46) $239.60
Diluted (2) ($65.60) ($125.94) ($482.46) $237.07
Net income (loss) per HPU share (3)
Basic ($34.80) ($116.93) ($336.33) $287.93
Diluted (2) ($34.80) ($116.47) ($336.33) $285.00
Weighted average HPU shares
outstanding
Basic and diluted 15 15 15 15
(1) For the three months ended December 31, 2008 and 2007, excludes
preferred dividends of $10,580. For the years ended December 31, 2008
and 2007, excludes preferred dividends of $42,320.
(2) For the year ended December 31, 2007, includes the allocable share of
$85 of joint venture income.
(3) As more fully explained in the Company's quarterly SEC filings, three
plans of the Company's HPU program vested in December 2002, December
2003 and December 2004. Each of the respective plans contain 5 HPU
shares. Cumulatively, these 15 shares were entitled to ($522) and
($1,754) of net income (loss) for the three months ended December 31,
2008 and 2007, respectively, and ($5,045) and $4,319 of net income
(loss) for the years ended December 31, 2008 and 2007, respectively.
On a diluted basis, these cumulative 15 shares were entitled to ($522)
and ($1,747) of net income (loss) for the three months ended December
31, 2008 and 2007, respectively, and ($5,045) and $4,275 of net income
(loss) for the years ended December 31, 2008 and 2007, respectively.
iStar Financial Inc.
Reconciliation of Adjusted Earnings to GAAP Net Income
(In thousands, except per share amounts)
(unaudited)
Three Months Ended Twelve Months Ended
December 31, December 31,
2008 2007 2008 2007
---- ---- ---- ----
ADJUSTED EARNINGS (1)
Net income (loss) ($12,517) ($69,845) ($196,791) $238,958
Add: Depreciation, depletion
and amortization 24,596 28,254 102,745 99,427
Add: Joint venture depreciation,
depletion and amortization 1,953 9,834 14,466 40,826
Add: Amortization of
deferred financing costs 9,907 8,145 43,800 28,367
Add: Impairment of goodwill
and intangible assets 9,069 - 60,618 -
Less: Hedge ineffectiveness, net 9,533 (3,183) 7,427 (239)
Less: Gain from discontinued
operations, net of minority
interest (18,971) (9) (87,769) (7,832)
Less: Gain on sale of joint
venture interest, net of
minority interest - - (261,659) (1,572)
Less: Preferred dividends (10,580) (10,580) (42,320) (42,320)
------- ------- ------- -------
Adjusted earnings (loss) allocable
to common shareholders and HPU
holders:
Basic $12,990 ($37,384) ($359,483) $355,615
Diluted $12,992 ($37,384) ($359,483) $355,707
Adjusted earnings (loss) per
common share:
Basic (2) $0.10 ($0.29) ($2.68) $2.74
Diluted (3) $0.10 ($0.29) ($2.68) $2.72
Weighted average common
shares outstanding:
Basic 122,809 127,267 131,153 126,801
Diluted 123,800 127,798 131,153 127,792
Common shares outstanding
at end of period:
Basic 105,457 133,929 105,457 133,929
Diluted 105,457 134,465 105,457 134,465
(1) Adjusted earnings should be examined in conjunction with net income as
shown in the Consolidated Statements of Operations. Adjusted earnings
should not be considered as an alternative to net income (determined
in accordance with GAAP) as an indicator of the Company's performance,
or to cash flows from operating activities (determined in accordance
with GAAP) as a measure of the Company's liquidity, nor is this
measure indicative of funds available to fund the Company's cash needs
or available for distribution to shareholders. Rather, adjusted
earnings is an additional measure the Company uses to analyze how its
business is performing. It should be noted that the Company's manner
of calculating adjusted earnings may differ from the calculations of
similarly-titled measures by other companies.
(2) For the three months ended December 31, 2008 and 2007, excludes $293
and ($816) of net income (loss) allocable to HPU holders,
respectively. For the years ended December 31, 2008 and 2007,
excludes ($7,461) and $7,799 of net income (loss) allocable to HPU
holders, respectively.
(3) For the three months ended December 31, 2008 and 2007, excludes $291
and ($812) of net income (loss) allocable to HPU holders,
respectively. For the years ended December 31, 2008 and 2007,
excludes ($7,461) and $7,730 of net income (loss) allocable to HPU
holders, respectively.
iStar Financial Inc.
Consolidated Balance Sheets
(In thousands)
As of As of
December 31, 2008 December 31, 2007
----------------- -----------------
(unaudited)
ASSETS
Loans and other lending investments, net $10,586,644 $10,949,354
Corporate tenant lease assets, net 3,044,811 3,309,866
Other investments 447,318 856,609
Other real estate owned 242,505 128,558
Assets held for sale - 74,335
Cash and cash equivalents 496,537 104,507
Restricted cash 155,965 32,977
Accrued interest and operating lease
income receivable, net 87,151 121,405
Deferred operating lease income receivable 116,793 102,135
Deferred expenses and other assets, net 114,838 125,274
Goodwill 4,186 43,278
----------- -----------
Total assets $15,296,748 $15,848,298
=========== ===========
LIABILITIES AND SHAREHOLDERS' EQUITY
Accounts payable, accrued expenses
and other liabilities $354,492 $495,311
Debt obligations:
Unsecured senior notes 7,218,160 7,916,853
Unsecured revolving credit facilities 3,281,273 2,681,174
Secured revolving credit facility 306,867 -
Interim financing facility - 1,289,811
Secured term loans 1,611,650 413,682
Other debt obligations 98,073 98,038
----------- -----------
Total liabilities 12,870,515 12,894,869
Minority interest in consolidated entities 36,853 53,948
Shareholders' equity 2,389,380 2,899,481
----------- -----------
Total liabilities and
shareholders' equity $15,296,748 $15,848,298
=========== ===========
iStar Financial Inc.
Supplemental Information
(In thousands)
(unaudited)
PERFORMANCE STATISTICS Three Months Ended
December 31, 2008
-----------------
Net Finance Margin
------------------
Weighted average GAAP yield of loan and CTL investments 7.44%
Less: Cost of debt 5.29%
----------
Net Finance Margin (1) 2.15%
Net Finance Margin Excluding Amortization of Discount
on Fremont Loans 1.99%
Return on Average Common Book Equity
------------------------------------
Average total book equity $2,421,731
Less: Average book value of preferred equity (506,176)
----------
Average common book equity (A) $1,915,555
Net income (loss) allocable to common
shareholders and HPU holders ($23,097)
Net income (loss) allocable to common
shareholders and HPU holders - Annualized (B) ($92,388)
Return on Average Common Book Equity (B) / (A) (4.8%)
Adjusted basic earnings (loss) allocable to
common shareholders and HPU holders (2) $12,990
Adjusted basic earnings (loss) allocable to
common shareholders and HPU holders - Annualized (C) $51,960
Adjusted Return on Average Common Book Equity (C) / (A) 2.7%
Expense Ratio
-------------
General and administrative expenses (3) (D) $34,693
Total revenue (3) (E) $291,731
Expense Ratio (D) / (E) 11.9%
(1) Weighted average GAAP yield is the annualized sum of interest income
and operating lease income, divided by the sum of average gross
corporate tenant lease assets, average loans and other lending
investments, average SFAS No. 141 purchase intangibles and average
assets held for sale over the period. Cost of debt is the annualized
sum of interest expense and operating costs-corporate tenant lease
assets, divided by the average gross debt obligations over the period.
Operating lease income and operating costs-corporate tenant lease
assets exclude SFAS No. 144 adjustments from discontinued operations
of $1,822 and $127, respectively. The Company does not consider net
finance margin to be a measure of the Company's liquidity or cash
flows. It is one of several measures that management considers to be
an indicator of the profitability of its operations.
(2) Adjusted earnings should be examined in conjunction with net income
(loss) as shown in the Consolidated Statements of Operations. Adjusted
earnings should not be considered as an alternative to net income
(loss) (determined in accordance with GAAP) as an indicator of the
Company's performance, or to cash flows from operating activities
(determined in accordance with GAAP) as a measure of the Company's
liquidity, nor is this measure indicative of funds available to fund
the Company's cash needs or available for distribution to
shareholders. Rather, adjusted earnings is an additional measure the
Company uses to analyze how its business is performing. It should be
noted that the Company's manner of calculating adjusted earnings may
differ from the calculations of similarly-titled measures by other
companies.
(3) Total revenue and general and administrative expenses exclude SFAS
No. 144 adjustments from discontinued operations of $1,822 and ($72),
respectively.
iStar Financial Inc.
Supplemental Information
(In thousands)
(unaudited)
CREDIT STATISTICS Three Months Ended
December 31, 2008
-----------------
Book debt, net of unrestricted cash (A) $12,019,486
Book equity 2,389,380
Add: Accumulated depreciation and loan loss reserves 1,456,371
-----------
Sum of book equity, accumulated depreciation and
loan loss reserves (B) $3,845,751
Leverage (1) (A) / (B) 3.1x
Ratio of Earnings (Loss) to Fixed Charges 0.8x
Ratio of Earnings (Loss) to Fixed Charges and
Preferred Stock Dividends 0.8x
Covenant Calculation of Fixed Charge Coverage Ratio (2) 2.7x
Interest Coverage
-----------------
EBITDA (3) (C) $175,185
GAAP interest expense (D) 161,153
EBITDA / GAAP Interest Expense (3) (C) / (D) 1.1x
RECONCILIATION OF NET INCOME TO EBITDA (3)
Net income (loss) ($12,517)
Add: GAAP interest expense 161,153
Add: Depreciation, depletion and amortization 24,596
Add: Joint venture depreciation, depletion and amortization 1,953
-----------
EBITDA (3) $175,185
(1) Leverage is calculated by dividing book debt net of unrestricted cash
by the sum of book equity, accumulated depreciation and loan loss
reserves.
(2) This measure, which is a trailing twelve-month calculation and
excludes the effect of impairment charges and other non-cash items, is
consistent with covenant calculations included in the Company's
unsecured credit facilities; therefore, we believe it is a useful
measure for investors to consider.
(3) EBITDA should be examined in conjunction with net income (loss) as
shown in the Consolidated Statements of Operations. EBITDA should not
be considered as an alternative to net income (loss) (determined in
accordance with GAAP) as an indicator of the Company's performance, or
to cash flows from operating activities (determined in accordance with
GAAP) as a measure of the Company's liquidity, nor is this measure
indicative of funds available to fund the Company's cash needs or
available for distribution to shareholders. It should be noted that
the Company's manner of calculating EBITDA may differ from the
calculations of similarly-titled measures by other companies.
iStar Financial Inc.
Supplemental Information
(In thousands)
(unaudited)
FINANCING VOLUME SUMMARY STATISTICS
Three Months Ended
December 31, 2008 LOAN ORIGINATIONS
------------------------------
Total/
Floating Weighted CORPORATE OTHER
Fixed Rate Rate Average LEASING INVESTMENTS
---------- -------- -------- --------- -----------
Amount funded $23,216 $622,458 $645,674 $9,411 $28,152
Weighted average
GAAP yield 5.91% 7.37% 7.31% 11.78% N/A
Weighted average
all-in spread/margin
(basis points) (1) 568 665 661 N/A N/A
Weighted average
first $ loan-to-value
ratio 45.07% 0.86% 2.36% N/A N/A
Weighted average
last $ loan-to-value
ratio 84.39% 75.10% 75.42% N/A N/A
UNFUNDED COMMITMENTS
Number of assets with unfunded commitments 194
Discretionary commitments $163,393
Non-discretionary commitments 2,263,966
-------------------
Total unfunded commitments $2,427,359
Estimated weighted average funding period Approximately 2.1 years
UNENCUMBERED ASSETS / UNSECURED DEBT
Unencumbered assets (A) $13,540,138
Unsecured debt (B) $10,612,225
Unencumbered Assets / Unsecured Debt (A) / (B) 1.3x
RISK MANAGEMENT STATISTICS
(weighted average
risk rating) 2008 2007
--------------------------------------------- ------------
December 31, September 30, June 30, March 31, December 31,
------------ ------------- -------- --------- ------------
Structured
Finance Assets
(principal risk) 3.53 3.41 3.28 3.12 3.07
Corporate Tenant
Lease Assets 2.58 2.55 2.55 2.51 2.50
(1=lowest risk; 5=highest risk)
(1) Represents spread over base rate LIBOR (floating-rate loans) and
interpolated U.S. Treasury rates (fixed-rate loans) during the
quarter.
iStar Financial Inc.
Supplemental Information
(In thousands, except per share amounts)
(unaudited)
LOANS AND OTHER LENDING INVESTMENTS CREDIT STATISTICS
As of
------------------------------------
December 31, 2008 December 31, 2007
----------------- -----------------
Value of non-performing loans (1) /
As a percentage of total managed
loans $3,458,157 27.48% $1,193,669 8.71%
Reserve for loan losses /
As a percentage of total managed
loans $976,788 7.76% $217,910 1.59%
As a percentage of non-performing
loans (1) 28.25% 18.26%
(1) Non-performing loans include iStar's book value and Fremont's
A-participation interest on the associated assets.
iStar Financial Inc.
Supplemental Information
(In millions)
(unaudited)
PORTFOLIO STATISTICS December 31, 2008 (1)
Asset Type
----------
First Mortgages / Senior Loans $10,670 68.4%
Corporate Tenant Leases 3,597 23.1
Mezzanine / Subordinated Debt 893 5.7
Other Investments 434 2.8
------- -----
Total $15,594 100.0%
======= =====
Property / Collateral Type
--------------------------
Apartment / Residential $4,244 27.2%
Land 2,359 15.1
Office 1,895 12.1
Industrial / R&D 1,489 9.5
Retail 1,348 8.7
Entertainment / Leisure 967 6.2
Corporate - Real Estate 868 5.6
Hotel 821 5.3
Mixed Use / Mixed Collateral 641 4.1
Other 582 3.7
Corporate - Non-Real Estate 380 2.5
------- -----
Total $15,594 100.0%
======= =====
Geography
---------
West $3,581 23.0%
Northeast 2,843 18.2
Southeast 2,659 17.1
Mid-Atlantic 1,672 10.7
Central 927 6.0
Southwest 923 5.9
Various 892 5.7
International 797 5.1
South 515 3.3
Northcentral 435 2.8
Northwest 350 2.2
------- -----
Total $15,594 100.0%
======= =====
(1) Figures presented prior to loan loss reserves, accumulated
depreciation and impact of Statement of Financial Accounting Standards
No. 141, "Business Combinations."
SOURCE iStar Financial Inc. -0- 02/26/2009
CONTACT:
Catherine D. Rice,
Chief Financial Officer,
or
Andrew G. Backman,
Senior Vice President - Investor Relations,
both of iStar Financial Inc.,
+1-212-930-9400
Sure would be nice.
Lot's of room for this to move up. That 200 MA is just calling our name. LOL.
Agreed, they will be much better off after they restructure. Holding long here.
Just got a email response from Guy, they are concentrating on getting production up and running right now which is understandable.
LOL....DOHHH!
Morning all, anyone hear anything lately?
The entire group in washington should be banned for life. Guess we just need to throw another trillion +++ out there and see if that works. Fuking morons.
Zale posts 2Q loss of $23.6 million
Zale posts quarterly loss on charges, discounts; closes stores and cuts jobs to boost savings
Wednesday February 25, 2009, 9:35 am EST
DALLAS (AP) -- Zale Corp. said Wednesday it posted a fiscal second-quarter loss of $23.6 million because of hefty charges and tough economic conditions, which caused the jeweler to discount merchandise at the expense of margins.
Related Quotes
Symbol Price Change
ZLC 1.46 0.00
{"s" : "zlc","k" : "c10,l10,p20,t10","o" : "","j" : ""} Also, the company plans to close 115 stores, which it expects to bring about $34 million in savings, and to cut 245 jobs, which Zale expects to bring $21 million in savings. Zale said some of the job cuts included positions that were already open.
Zale posted a loss of 74 cents per share, after profit of $60.8 million, or $1.34 per share, in the year-earlier period.
Results included store impairment charges of 16 cents per share, goodwill impairment charges of 16 cents per share and 58 cents in accounting-related charges.
Adjusted to exclude these charges, earnings were 16 cents per share.
For the quarter ended Jan. 31, sales declined 18 percent to $679.4 million from $827.8 million last year, while same-store sales also declined 18 percent. Same-store sales measure sales at stores open at least a year.
Analysts surveyed by Thomson Reuters expected 48 cents per share and sales of $693.3 million.
Chief Executive Neal Goldberg said operating results were hurt by the "extremely weak" economy.
"In response to the continued deterioration in the business, we aggressively promoted storewide discounts during our holiday sales season," Goldberg said.
Goldberg said the discounts hurt gross margin by about 500 basis points.
Yep, good to see some action here today. Patiently waiting on some updates on this one.
Still have some of that one as well in my long stash.
Looking good so far. Will add the dips and keep some for the long haul.
Just a matter of time bud.
Morning all. FITB GNW
Morning everyone. Maybe we get an update this week form the US visit.
Morning everyone. Still holding and waiting here.
Geitner just farted.
Damn, are we gonna test 7000 before this fuker turns?
Will be coming in this one shortly IH.
Would like to have snatched some of those 1.30's.
I could give 2 shts if you believe it or not. Someone asked if they heard from Shawn and I did so I responded. I will not do it again though.
Too funny, sad thing is it has a ring of truth to it.
If you don't think it's authentic then I suggest you contact the company yourself then.
Yep, very quite right now.
Got an email into them now. Will post when I get something back.
Morning all.
Welcome Cebu.
You and me both bud.
Got ya, well let's hope this opened thier eyes a bit.
You're kidding right?
If it's gonna be "R" VS. "D" then a better question would be why are they just now starting the process instead of 2 years ago when they gained majority in the both houses?
SEC Names Ex-Prosecutor Khuzami to Head Enforcement (Update1)
Email | Print | A A A
By David Scheer and Jesse Westbrook
Feb. 19 (Bloomberg) -- U.S. Securities and Exchange Commission Chairman Mary Schapiro named Robert Khuzami, a former prosecutor of white-collar criminals and terrorists, her enforcement chief as she tries to restore confidence in the agency’s ability to police financial markets.
Khuzami, Deutsche Bank AG’s general counsel for the Americas, was appointed today to head the SEC’s biggest division, the agency said in a statement. No start date has been set, SEC spokesman John Nester said. Linda Thomsen, the unit’s chief since 2005, said Feb. 9 she plans to return to private practice.
“Throughout his career, Rob has demonstrated an unwavering commitment to prosecuting wrongdoers and protecting citizens,” Schapiro said in the statement. “As a former federal prosecutor, Rob is well-suited to lead the SEC’s Division of Enforcement as we continue to crack down on those who would betray the trust of investors.”
Khuzami, 52, is joining an agency that’s under fire from investors and lawmakers for missing Bernard Madoff’s alleged $50 billion Ponzi scheme. Former colleagues and legal opponents describe him as a tough attorney and public servant who keeps calm under pressure.
“People on Wall Street better watch out,” said Anthony Ricco, a New York lawyer who represented a defendant Khuzami helped convict in a trial connected to the 1993 bombing of the World Trade Center. “He is a person who really believes in the public good, and those people often make judgments that make Wall Street cringe.”
‘Financial Suffering’
In today’s SEC statement, Khuzami said he will “relentlessly pursue and bring to justice those whose misconduct infects our markets, corrodes investor confidence and has caused so much financial suffering.”
He spent 11 years at the U.S. Attorney’s Office for the Southern District of New York, which covers Manhattan. He focused on terrorism cases such as the plot by Omar Abdel-Rahman, who is known as the blind sheik, and others to blow up New York landmarks. Khuzami later headed that office’s Securities and Commodities Fraud Task Force for three years.
In 2000, Khuzami helped convict Patrick Bennett, the chief financial officer of Bennett Funding Group Inc., and other people in an equipment-leasing fraud. Bennett was sentenced to 22 years in prison.
“He always had really good judgment about bringing cases, and that’s going to be helpful to the SEC,” said Christopher Clark, a partner at Dewey & LeBoeuf LLP in New York who worked with Khuzami as a prosecutor. “He knew what cases weren’t worth bringing because they were weak or insignificant and which cases to go after for general deterrence purposes.”
Highest Citation
In the 1990s, Khuzami received the Justice Department’s highest citation, the Attorney General’s Award for Exceptional Service, as well as the Federal Law Enforcement Foundation’s Federal Prosecutor Award, the SEC said. The New York City bar association granted him the Henry L. Stimson award for outstanding public service in 2001.
The next year, he took a job at Deutsche Bank in New York, where he supervised more than 100 lawyers, the SEC said.
Khuzami’s securities firm ties won’t lead him to go soft on Wall Street, said Roger Stavis, a New York attorney who also represented a defendant in the World Trade Center case.
He will always be “identified as a former Southern District” attorney, said Stavis, a senior partner at Gallet, Dreyer & Berkey LLP in New York. “It travels with you. You can work on Wall Street but you are not of Wall Street.”
Giuliani, Fitzgerald
Southern District alumni include former New York City Mayor Rudolph Giuliani and U.S. Attorney Patrick Fitzgerald, who in December accused then-Illinois Governor Rod Blagojevich of trying to sell the U.S. Senate seat vacated by President Barack Obama and earlier probed the Bush administration over the leak of a Central Intelligence Agency official’s name to reporters.
Fitzgerald and Khuzami worked under former Assistant U.S. Attorney Andrew McCarthy in prosecuting Abdel-Rahman and his co- conspirators. Stavis said one of his lasting memories of the three men is that they showed up at the funeral of his father, who died during the trial.
“Even though we were on opposite sides, we worked very closely together,” Stavis said.
Madoff was arrested Dec. 11 after allegedly admitting his investment advisory business was “one big lie.” Congress has held three hearings to examine the case, and lawmakers on Feb. 4 assailed Thomsen, 54, and other agency officials for declining to discuss why the agency didn’t uncover Madoff’s scheme after repeated warnings by former money manager Harry Markopolos.
Political Spectrum
Schapiro, an independent appointed by Democrat Obama, took over the SEC last month and on Feb. 6 announced steps to speed up enforcement cases. The selection of Khuzami, a Republican, may reflect willingness to work across the political spectrum.
Khuzami spoke at the 2004 Republican National Convention in New York, encouraging Americans to re-elect then President George W. Bush to “protect both our lives and our liberties.”
He also contributed $2,300 to Arizona Senator John McCain’s presidential campaign, according to Federal Election Commission records. Obama defeated McCain in the November election.
Deutsche Bank skirted the worst of the U.S. subprime mortgage crash by short-selling bonds that contributed to more than $1 trillion of losses and writedowns at the world’s largest financial companies.
The Frankfurt-based bank has booked about 9.3 billion euros in markdowns since the U.S. subprime mortgage market collapsed in 2007. New York-based Citigroup Inc. has had $85 billion of markdowns, according to data compiled by Bloomberg.
To contact the reporters on this story: David Scheer in New York at dscheer@bloomberg.net; Jesse Westbrook in Washington at jwestbrook1@bloomberg.net
Maybe....just maybe they will follow through with it.
Bill Introduced to Reinstate the Uptick Rule
February 16, 2009
As some traders are already aware--on January 8, 2009, Rep. Gary Ackerman [D-NY] introduced Bill HR 302 IH in the House Of Representatives to "require the Securities and Exchange Commission to re-instate the uptick rule on short sales of securities."
The bill has now been referred to the Committee on Financial Services, and is co-sponsored by:
Rep. Carolyn McCarthy [D-NY]
Rep. Anthony Weiner [D-NY]
Rep. Carolyn Maloney [D-NY]
Rep. Michael Thompson [D-CA]
Rep. Nita Lowey [D-NY]
Rep. Michael Capuano [D-MA]
Rep. Ed Perlmutter [D-CO]
Here is the text of the bill:
SECTION 1. REINSTATEMENT REQUIRED.
Within 90 days after the date of enactment of this Act, the Securities and Exchange Commission shall--
(1) reinstate rule 10a-1 of the Commission’s rules (17 CFR 240.10a-1);
(2) rescind rule 201 of regulation SHO (17 CFR 242.201); and
(3) take such other actions as may be necessary to reinstate the price test restrictions that applied to short sales of securities prior to the Commission’s action in the proceeding entitled ‘Regulation SHO and Rule 10a-1’, adopted June 28, 2007 (Release No. 34-55970; File No. S7-21-06).
This is a bill to which all "longs" should immediately take the opportunity to write or email the aforementioned sponsors and your Representatives en masse, and state your full support.
As traders are fully aware, the uptick rule's rescission in June 2007 contributed directly to short-sellers (including funds) being able to relentlessly "pin the bids" of stocks, such as financials, forcing stock prices lower and lower, and causing massive damage to long investors. To date, shorts have conducted endless bear raids with impunity (and will continue to do so unless and until the uptick rule is restored).
The fact that the uptick rule had not already been re-instated, in the first place, throughout the entire market crash, is downright absurd (and suspicious). Regardless, there is now a bill on the table...and it is every "long" trader's responsibility to do his or her part- and get Congress off its butt to finally do something relevant for the stock market. And, the more the bill's sponsors and/or your Reps hear you all- the better.
This is the time to help effect real change in D.C.
Write or Email your Representative here.
Let's roll...
Well, Dow broke 7500. What's the word people?
Seriously debating it myself friend. Bring back the F'ing uptick rule!!!