BofI Holding, Inc. (NASDAQ:BOFI) Q2 2015 Earnings Conference Call - Final Transcript

Jan 29, 2015 • 04:30 pm ET

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BofI Holding, Inc. (NASDAQ:BOFI) Q2 2015 Earnings Conference Call - Final Transcript

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Operator
operator

Good day, ladies and gentlemen. Thank you for standing by. Welcome to the BofI Holding, Inc. Second Quarter Fiscal 2015 Earnings Conference Call. (Operator Instructions) This conference is being recorded today, Thursday, January 29, 2015.

Now I would like to turn the conference over to Johnny Lai, from BofI Holding, Inc. Please go ahead, sir.

Executive
Johnny Y. Lai

Thank you, and good afternoon, everyone. Joining us today for BofI holding, Inc.'s Second Quarter Financial Results Conference Call are the company's President and Chief Executive Officer, Greg Garrabrants; and Executive Vice President and Chief Financial Officer, Andy Micheletti. Greg and Andy will review then and comment on the financial and operational results for the second quarter, and they will be available to answer questions after the prepared presentation.

(Forward-Looking Cautionary Statements)

This call is being webcast and there will be an audio replay available on our Investor Relations website located at www.bofiholding.com. All the details of this call were provided on the conference call announcement and in today's press release.

At this time, I would like to turn the call over to Mr. Greg Garrabrants, who will provide opening remarks. Greg, the floor is yours.

Executive
Gregory Garrabrants

Thank you, Johnny. Good afternoon, everyone, and thank you for joining us. I'd like to welcome everyone to BofI Holding's conference call for the second quarter of fiscal year 2015 ended December 31, 2014. I thank you for your interest in BofI Holding and BofI Federal Bank.

BofI announced record net income of $19,372,000 for its second quarter ended 2015, up 47.3% when compared to the $13,154,000 earned in the second quarter ended December 31, 2013, and up 8.6% when compared to the $17,841,000 earned last quarter. Earnings attributable to BofI's common stockholders were $19,294,000 or $1.26 per diluted share for the quarter ended December 31, 2014, compared to $0.91 per diluted share for the quarter ended December 31, 2013, and $1.20 per diluted share for the quarter ended September 30, 2014.

Excluding the after-tax impact of net gains related to investment securities, core earnings for the second quarter ended December 31, 2014, increased $5.6 million or 40.6% when compared to the quarter ended December 31, 2013.

Other highlights for the second quarter include total assets reached $5,194,000,000 at December 31, 2014, up $792 million compared to June 30, 2014, and up $1.6 billion from the second quarter of 2014. Return on equity reached 19.08% for the second quarter. The efficiency ratio was 34.55% for the second quarter of fiscal 2015, an improvement from 39.89% from the second quarter of fiscal 2014, and 34.81% in the first quarter of 2015.

Credit quality remains very good with 2 basis points of net charge-offs in the second quarter compared to 5 basis points in the corresponding period a year ago. Our loan units had another great quarter with $1,079,000,000 in gross loans originated in the second quarter. As a result, the bank achieved good quarterly loan growth as loan balances grew by 8.7% over the first quarter, which equates to a 34.8%