|
|
|
|
Document Preview Conversion Valuation Appraisal |
||||
|
|
||||
|
Click "Add to Cart" button to purchase document. |
||||
|
|
||||
|
Title: |
Conversion Valuation Appraisal |
|||
|
Entities: |
||||
|
Date: |
2003 |
|||
|
Size: |
Preview shows 19KB of 216KB total |
|||
|
Price: |
$66 |
|||
|
ID: |
#401145 |
|||
|
|
||||
|
||||
|
|
||||
|
Start of Preview |
||||
{TEXT}
================================================================================
CLIFTON SAVINGS
BANCORP, INC.
CONVERSION
VALUATION
APPRAISAL
September 11, 2003
================================================================================
{PAGE}
Table of Contents
Clifton Savings Bancorp, Inc.
Clifton, New Jersey
TABLE OF CONTENTS I
--------------------------------------------------------------------------------
INTRODUCTION 1
--------------------------------------------------------------------------------
1. OVERVIEW AND FINANCIAL ANALYSIS 4
--------------------------------------------------------------------------------
GENERAL OVERVIEW 4
HISTORY 5
STRATEGIC DIRECTION 6
BALANCE SHEET TRENDS 9
LOAN PORTFOLIO 12
INVESTMENTS 15
INVESTMENTS AND MORTGAGE-BACKED SECURITIES 16
ASSET QUALITY 17
FUNDING COMPOSITION 20
ASSET/LIABILITY MANAGEMENT 22
NET WORTH AND CAPITAL 23
INCOME AND EXPENSE TRENDS 24
LEGAL PROCEEDINGS 29
SUBSIDIARIES 29
2. MARKET AREA ANALYSIS 30
--------------------------------------------------------------------------------
MARKET AREA DEMOGRAPHICS 31
MARKET AREA DEPOSIT CHARACTERISTICS 35
3. COMPARISONS WITH PUBLICLY TRADED THRIFTS 40
--------------------------------------------------------------------------------
INTRODUCTION 40
SELECTION SCREENS AND CRITERIA 41
4. MARKET VALUE DETERMINATION 47
--------------------------------------------------------------------------------
COMPARABLE GROUP ADJUSTMENTS 47
BALANCE SHEET STRENGTH 49
ASSET QUALITY 52
PROFITABILITY AND GROWTH 53
--------------------------------------------------------------------------------
I
{PAGE}
EARNINGS QUALITY 55
DIVIDENDS 57
LIQUIDITY OF THE ISSUE/SIZE OF THE OFFERING 59
RECENT REGULATORY MATTERS 61
MARKET FOR SEASONED THRIFT STOCKS 62
ACQUISITION MARKET 68
ADJUSTMENTS TO VALUE IN RELATION TO THE COMPARABLE GROUP 70
5. OTHER FACTORS 71
--------------------------------------------------------------------------------
MANAGEMENT 71
MARKET AREA 72
SUBSCRIPTION INTEREST 75
ADJUSTMENTS TO VALUE IN RELATION TO OTHER FACTORS 78
6. VALUATION 79
--------------------------------------------------------------------------------
DISCUSSION OF WEIGHT GIVEN TO VALUATION MULTIPLES 79
FULL OFFERING VALUE IN RELATION TO COMPARABLES 81
COMPARISON TO RECENT AND HISTORICAL STANDARD CONVERSIONS 83
VALUATION CONCLUSION 85
--------------------------------------------------------------------------------
II
{PAGE}
List of Figures
Clifton Savings Bancorp, Inc.
Clifton, New Jersey
FIGURE 1 - CURRENT FACILITIES LIST 4
FIGURE 2 - ASSET AND RETAINED EARNINGS CHART 9
FIGURE 3 - KEY BALANCE SHEET DATA 10
FIGURE 4 - KEY RATIOS 11
FIGURE 5 - NET LOANS RECEIVABLE CHART 12
FIGURE 6 - LOAN MIX AS OF JUNE 30, 2003 CHART 13
FIGURE 7 - LOAN MIX 14
FIGURE 8 - SECURITIES CHART 15
FIGURE 9 - INVESTMENT MIX 16
FIGURE 10 - ASSET QUALITY CHART 17
FIGURE 11 - NON-PERFORMING LOANS 18
FIGURE 12 - ALLOWANCE FOR POSSIBLE LOAN AND LEASE LOSSES CHART 19
FIGURE 13 - DEPOSIT AND BORROWING TREND CHART 20
FIGURE 14 - DEPOSIT MIX 21
FIGURE 15 - NET PORTFOLIO VALUE 22
FIGURE 16 - CAPITAL ANALYSIS 23
FIGURE 17 - NET INCOME CHART 24
FIGURE 18 - AVERAGE YIELDS AND COSTS 25
FIGURE 19 - SPREAD AND MARGIN CHART 26
FIGURE 20 - INCOME STATEMENT TRENDS 27
FIGURE 21 - PROFITABILITY TREND CHART 28
FIGURE 22 - MARKET AREA MAPS 30
FIGURE 23 - POPULATION DEMOGRAPHICS 31
FIGURE 23 - POPULATION DEMOGRAPHICS 2 32
FIGURE 24 - HOUSEHOLD CHARACTERISTICS 33
FIGURE 24 - HOUSEHOLD CHARACTERISTICS 2 34
FIGURE 25 - 1433 VAN HOUTEN MARKET SHARE 35
FIGURE 26 - 646 VAN HOUTEN AVE MARKET SHARE 35
FIGURE 27 - CLIFTON AVE MARKET SHARE 36
FIGURE 28 - LANZA AVE MARKET SHARE 36
FIGURE 29 - LAKEVIEW AVE AND VILLAGE SQUARE MARKET SHARE 37
FIGURE 30 - PALISADE AVE MARKET SHARE 37
FIGURE 31 - VALLEY ROAD MARKET SHARE 38
FIGURE 32 - WAYNE MARKET SHARE 38
FIGURE 33 - WALLINGTON AVE MARKET SHARE 39
FIGURE 34 - COMPARABLE GROUP 42
FIGURE 35 - KEY FINANCIAL INDICATORS 45
FIGURE 36 - KEY BALANCE SHEET DATA 49
FIGURE 37 - BALANCE SHEET GROWTH DATA 50
FIGURE 38 - CAPITAL DATA 51
FIGURE 39 - ASSET QUALITY TABLE 52
FIGURE 40 - NET INCOME TREND 53
FIGURE 41 - PROFITABILITY DATA 54
FIGURE 42 - INCOME STATEMENT DATA 56
FIGURE 43 - DIVIDEND DATA 57
FIGURE 44 - MARKET CAPITALIZATION DATA 59
FIGURE 45 - INDUSTRY MULTIPLES BY MARKET CAPITALIZATION 60
FIGURE 46 - SNL THRIFT INDEX CHART 62
--------------------------------------------------------------------------------
III
{PAGE}
FIGURE 47 - HISTORICAL SNL THRIFT INDEX 63
FIGURE 48 - EQUITY INDICES 65
FIGURE 49 - HISTORICAL MARKET INDICES 66
FIGURE 50 - HISTORICAL RATES 67
FIGURE 51 - DEALS FOR LAST THIRTY THREE QUARTERS 68
FIGURE 52 - DEAL MULTIPLES 69
FIGURE 53 - NEW JERSEY THRIFT DEALS SINCE ANNOUNCED AFTER 2000 69
FIGURE 54 - COUNTY DEMOGRAPHIC DATA 72
FIGURE 55 - BRANCH PERFORMANCE BY COUNTY 73
FIGURE 56 - NEW JERSEY RELATIVE TO THE REGION 74
FIGURE 57 - STANDARD CONVERSION PRO FORMA PRICING MULTIPLES 76
FIGURE 58 - AFTER MARKET PERFORMANCE 77
FIGURE 59 - VALUE RANGE - FULL OFFERING 81
FIGURE 60 - VALUE RANGE PRICING MULTIPLES 81
FIGURE 61 - COMPARABLE PRICING MULTIPLES TO THE BANK'S PRO FORMA MIDPOINT 82
FIGURE 62 - COMPARABLE PRICING MULTIPLES TO THE BANK'S PRO FORMA SUPER
MAXIMUM 82
FIGURE 63 - PENDING STANDARD CONVERSION APPLICATIONS 83
FIGURE 64 - HIGHEST PRICED STANDARD CONVERSIONS 83
FIGURE 65 - HIGH TANGIBLE EQUITY ANALYSIS 84
--------------------------------------------------------------------------------
IV
{PAGE}
List of Exhibits
Clifton Savings Bancorp, Inc.
Clifton, New Jersey
Exhibit
---------
1. Profile of FinPro, Inc.
2. Statements of Financial Condition
3. Statements of Income
4. Reconciliation of the TFR Schedule SO and the Audited Income Statement
5. Statements of Retained Earnings
6. Statements of Cash Flows
7. Selected Financial Data
8. Industry Multiples
9. Industry Multiples by Market Capitalization
10. Standard Conversions 2000 to Date
11. Appraisal Pro Forma June 30, 2003 - Full Offering 12 Months
12. Offering Circular Pro Forma March 31, 2003 - Full Offering 12 Months
13. Stub Pro Forma June 30, 2003 - Full Offering 3 Months
--------------------------------------------------------------------------------
V
{PAGE}
Conversion Valuation Appraisal Report Page: 1 - 1
================================================================================
Introduction
This report represents FinPro, Inc.'s ("FinPro") updated independent appraisal
of the estimated pro forma market value of the common stock (the "Common Stock")
of Clifton Savings Bancorp, Inc. (the "Company") in connection with the Plan of
Conversion (the "Conversion") of Clifton Savings Bank, S.L.A., (the "Bank" or
"Clifton Savings") from a state chartered mutual savings and loan association to
a stock savings and loan association. As part of the Conversion, the Bank will
become a wholly owned subsidiary of Clifton Savings Bancorp, Inc.
In compiling the pro forma financials, FinPro relied upon the assumptions
provided by the Bank and its agents. The pro forma assumptions are as follows:
o 100% of the stock will be offered to the public,
o the stock will be issued at $10.00 per share,
o the conversion expenses will be $3.3 million at the midpoint,
o there will be an 8% ESOP funded internally, amortized over 25 years
straight-line,
o there will be a 4% MRP, amortized over 5 years straight-line,
o the tax rate is assumed at 39.94%, and
o the net proceeds will be invested at the three-year treasury rate of
1.95%, pre-tax.
It is our understanding that the Company will offer its stock in a subscription
and community offering to Eligible Account Holders, to the tax qualified
Employee Plans, to Supplemental Eligible Account Holders, and to Other Members.
This appraisal has been prepared in accordance with the "Guidelines for
Appraisal Reports for the Valuation of Savings and Loan Associations Converting
from Mutual to Stock Form of Organization" of the Office of Thrift Supervision
("OTS") which have been adopted in practice by the Federal Deposit Insurance
Corporation ("FDIC"), including the most recent revisions as of October 21,
1994, and applicable regulatory interpretations thereof.
{PAGE}
Conversion Valuation Appraisal Report Page: 1 - 2
================================================================================
In the course of preparing our report, we reviewed the financial statements of
the Bank's operations for the three months ended June 30, 2003, and the Bank's
audited financials for the years ended March 31, 2003 and March 31, 2002. We
also reviewed the Bank's Application for Approval of Conversion including the
Proxy Statement and the Company's Form S-1 registration statement as filed with
the Securities and Exchange Commission ("SEC"). We have conducted due diligence
analysis of the Bank and the Company (hereinafter, collectively referred to as
"the Bank") and held due diligence related discussions with the Bank's
management and board, Radics & Co., LLC (the Bank's independent auditor), Keefe
Bruyette & Woods, Inc. (the Bank's underwriter), and Muldoon Murphy & Faucette
LLP (the Bank's special counsel). The valuation parameters set forth in the
appraisal were predicated on these discussions but all conclusions related to
the valuation were reached and made independent of such discussions.
Where appropriate, we considered information based upon other publicly available
sources, which we believe to be reliable; however, we cannot guarantee the
accuracy or completeness of such information. We visited the Bank's primary
market area and reviewed the market area economic condition. We also reviewed
the competitive environment in which the Bank operates and its relative
strengths and weaknesses. We compared the Bank's performance with selected
publicly traded thrift institutions. We reviewed conditions in the securities
markets in general and in the market for savings institutions in particular. Our
analysis included a review of the estimated effects of the Conversion of the
Bank on the operations and expected financial performance as they related to the
Bank's estimated pro forma value.
In preparing our valuation, we relied upon and assumed the accuracy and
completeness of financial and other information provided to us by the Bank and
its independent accountants. We did not independently verify the financial
statements and other information provided by the Bank and its independent
accountants, nor did we independently value any of the Bank's assets or
liabilities. This estimated valuation considers the Bank only as a going concern
and should not be considered as an indication of its liquidation value.
Our valuation is not intended, and must not be construed, to be a recommendation
of any kind as the advisability of purchasing shares of Common Stock in the
stock issuance. Moreover, because such valuation is necessarily based upon
estimates and projections of a number of matters, all of which are subject to
change from time to time, no assurance can be given that persons who purchase
shares of Common Stock in the stock issuance will thereafter be able to sell
such shares at prices related to the foregoing valuation of the pro forma market
value thereof. FinPro is not a seller of securities within the meaning of any
federal or state securities laws and any report prepared by FinPro shall not be
used as an offer or solicitation with respect to the purchase or sale of any
|
End of Preview |
Home Intelligence Services Subscriptions News About Us