EX-99 2 ex99-3x31x17financialpress.htm EXHIBIT 99 MARCH 31, 2017 FINANCIAL PRESS RELEASE Exhibit
Exhibit 99

Contact Info:    James A. Marcotte, Executive Vice President, Chief Financial Officer and Treasurer (978) 656-5614

Enterprise Bancorp, Inc. Announces First Quarter 2017 Net Income of $5.6 Million
LOWELL, Mass., April 20, 2017 (GLOBE NEWSWIRE) - Enterprise Bancorp, Inc. (the “Company”) (NASDAQ: EBTC), parent of Enterprise Bank, announced net income for the three months ended March 31, 2017 of $5.6 million, an increase of $1.3 million, or 29%, compared to the three months ended March 31, 2016. Diluted earnings per share were $0.48 for the three months ended March 31, 2017, an increase of 17%, compared to the three months ended March 31, 2016. Diluted earnings per share for the first quarter of 2017 includes the dilutive impact of the Company’s equity offering in the second quarter of 2016.
  
As previously announced on April 18, 2017, the Company declared a quarterly dividend of $0.135 per share to be paid on June 1, 2017 to shareholders of record as of May 11, 2017. The 2017 dividend rate represents a 3.8% increase over the 2016 dividend rate.

Chief Executive Officer Jack Clancy commented, “The increase in our 2017 earnings compared to 2016 has been positively impacted by our growth over the last twelve months. Total assets, loans, and customer deposits have increased 12%, 11%, and 11%, respectively, as compared to March 31, 2016. This growth continues to be driven by the collective efforts and contributions of our dedicated Enterprise team, active community involvement, relationship building and a customer-focused mindset, market expansion, and ongoing enhancements to our state-of-the-art product and service offerings.”

Mr. Clancy continued, “Strategically, our focus remains on organic growth and continually planning for and investing in our future. We look forward to opening our 24th branch office in Windham, NH near the end of the second quarter. The relocation of our branches in Salem, NH and Leominster, MA will provide improved and state-of-the-art branches in those communities to better serve our customers. We expect the Salem branch to be completed in July of 2017 and Leominster to be completed in late 2017 to early 2018.”

Founder and Chairman of the Board George Duncan commented, “This quarter represents our 110th consecutive profitable quarter and our consistency is a record few banks in the country could duplicate. We are approaching $3.5 billion in assets under management which is a testimony to our long term strategic planning. We also appreciate the tremendous support, including many business referrals, that we have received from our shareholders.”

Results of Operations

Net interest income for the three months ended March 31, 2017 amounted to $22.8 million, an increase of $1.8 million, or 8%, compared to the three months ended March 31, 2016. The increase in net interest income was due primarily to loan growth. Average loan balances (including loans held for sale) increased $183.7 million for the three months ended March 31, 2017 compared to the same 2016 period averages. Net interest margin was 3.90% for the three months ended March 31, 2017, compared to 4.02% for the three months ended March 31, 2016. The quarterly net interest margin for the three months ended December 31, 2016 was 3.86%.

For the three months ended March 31, 2017 and March 31, 2016, the provision for loan losses amounted to $125 thousand and $850 thousand, respectively. The decrease in the provision in the first quarter was due primarily to net recoveries in the current year, and generally improving credit quality metrics, partially offset by increased loan growth compared to the prior year.
Contributing to the changes in the provision for loan losses compared to the prior year were:
•
The Company recorded net recoveries of $216 thousand for the three months ended March 31, 2017, compared to net recoveries of $52 thousand for the three months ended March 31, 2016.



•
Total non-performing loans as a percentage of total loans (a measure of credit risk) declined to 0.45% at March 31, 2017, compared to 0.60% at March 31, 2016.

•
The balance of the allowance for loan losses allocated to impaired and adversely classified loans amounted to $4.1 million at March 31, 2017, compared to $4.3 million at March 31, 2016.

•
Loan growth for three months ended March 31, 2017 was $42.1 million, compared to $4.7 million during the three months ended March 31, 2016.

The allowance for loan losses to total loans ratio was 1.53% at March 31, 2017, 1.55% at December 31, 2016 and 1.60% at March 31, 2016.
Non-interest income for the three months ended March 31, 2017 amounted to $4.1 million, an increase of $928 thousand, or 29%, compared to the three months ended March 31, 2016. This increase was due primarily to an increase in net gains on the sales of investment securities. Additionally, the Company's growth has contributed to increases in the main components of other non-interest income.

For the three months ended March 31, 2017, non-interest expense amounted to $19.4 million, an increase of $2.6 million, or 15%, over the three months ended March 31, 2016. Increases in expenses over the prior year primarily related to the Company’s strategic growth and market expansion initiatives, particularly increases in salaries and benefits expenses.

In the first quarter of 2017, the Company implemented accounting pronouncement ASU No. 2016-09 “Compensation-Stock Compensation (Topic 718) Improvements to Employee Share-Based Payment Accounting,” which reduced tax expense and increased earnings by approximately $667 thousand. One of the aspects of this pronouncement relates to the tax treatment of employee and director equity compensation.

Key Financial Highlights

▪
Total assets amounted to $2.57 billion at March 31, 2017, compared to $2.53 billion at December 31, 2016, an increase of $46.1 million, or 2%.
▪
Total loans amounted to $2.06 billion at March 31, 2017, compared to $2.02 billion at December 31, 2016, an increase of $42.1 million, or 2%.
▪
Customer deposits (total deposits excluding brokered deposits) were $2.22 billion at March 31, 2017, compared to $2.21 billion at December 31, 2016, an increase of $6.0 million. Brokered deposits were $59.4 million at both March 31, 2017 and December 31, 2016.
▪
Investment assets under management amounted to $747.5 million at March 31, 2017, compared to $725.3 million at December 31, 2016, an increase of $22.1 million, or 3%.
▪
Total assets under management amounted to $3.40 billion at March 31, 2017, compared to $3.33 billion at December 31, 2016, an increase of $69.9 million, or 2%.

Enterprise Bancorp, Inc. is a Massachusetts corporation that conducts substantially all of its operations through Enterprise Bank and Trust Company, commonly referred to as Enterprise Bank. The Company is principally engaged in the business of attracting deposits from the general public and investing in commercial loans and investment securities. Through Enterprise Bank and its subsidiaries, the Company offers a range of commercial, residential and consumer loan products, and deposit products and cash management services, as well as investment advisory and wealth management, trust, and insurance services. The Company’s headquarters and the bank’s main office are located at 222 Merrimack Street in Lowell, Massachusetts. The Company’s primary market area is the Greater Merrimack Valley and North Central regions of Massachusetts and Southern New Hampshire. Enterprise Bank has 23 full-service branch offices located in the Massachusetts communities of Lowell, Acton, Andover, Billerica, Chelmsford, Dracut, Fitchburg, Lawrence, Leominster, Methuen, Tewksbury, Tyngsborough and Westford and in the New Hampshire communities of Derry, Hudson, Nashua, Pelham and Salem. The Company also anticipates that the Windham, NH office will open mid-year 2017.




This earnings release contains statements about future events that constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by references to a future period or periods or by the use of the words “believe,” “expect,” “anticipate,” “intend,” “estimate,” “assume,” “will,” “should,” “plan,” and other similar terms or expressions. Forward-looking statements should not be relied on because they involve known and unknown risks, uncertainties and other factors, some of which are beyond the control of the Company. These risks, uncertainties and other factors may cause the actual results, performance, and achievements of the Company to be materially different from the anticipated future results, performance or achievements expressed or implied by the forward-looking statements. Factors that could cause such differences include, but are not limited to, general economic conditions, changes in interest rates, regulatory considerations, competition, and the receipt of required regulatory approvals. For more information about these factors, please see our reports filed with or furnished to the Securities and Exchange Commission (the “SEC”), including our most recent Annual Report on Form 10-K on file with the SEC, including the sections entitled “Risk Factors” and “Management's Discussion and Analysis of Financial Condition and Results of Operations.” Any forward-looking statements contained in this press release are made as of the date hereof, and we undertake no duty, and specifically disclaim any duty, to update or revise any such statements, whether as a result of new information, future events or otherwise, except as required by applicable law.
 



ENTERPRISE BANCORP, INC.
Consolidated Balance Sheets
(unaudited)
 
(Dollars in thousands)
 
March 31,
2017
 
December 31,
2016
 
March 31,
2016
Assets
 
 

 
 

 
 
Cash and cash equivalents:
 
 

 
 

 
 
Cash and due from banks
 
$
35,432

 
$
33,047

 
$
34,018

Interest-earning deposits
 
18,858

 
17,428

 
24,912

Total cash and cash equivalents
 
54,290

 
50,475

 
58,930

Investment securities at fair value
 
376,212

 
374,790

 
304,946

Federal Home Loan Bank stock
 
3,174

 
2,094

 
2,793

Loans held for sale
 
752

 
1,569

 
770

Loans, less allowance for loan losses of $31,683 at March 31, 2017, $31,342 at December 31, 2016 and $29,910 at March 31, 2016
 
2,033,168

 
1,991,387

 
1,834,782

Premises and equipment, net
 
34,991

 
33,540

 
31,984

Accrued interest receivable
 
9,282

 
8,792

 
8,393

Deferred income taxes, net
 
16,387

 
17,020

 
12,962

Bank-owned life insurance
 
28,941

 
28,765

 
28,209

Prepaid income taxes
 
534

 
1,344

 
—

Prepaid expenses and other assets
 
8,972

 
10,837

 
15,207

Goodwill
 
5,656

 
5,656

 
5,656

Total assets
 
$
2,572,359

 
$
2,526,269

 
$
2,304,632

Liabilities and Stockholders’ Equity
 
 
 
 
 
 
Liabilities
 
 
 
 
 
 
Deposits
 
$
2,274,912

 
$
2,268,921

 
$
2,087,737

Borrowed funds
 
46,671

 
10,671

 
671

Subordinated debt
 
14,837

 
14,834

 
14,825

Accrued expenses and other liabilities
 
15,885

 
16,794

 
13,497

Income taxes payable
 
—

 
—

 
1,551

Accrued interest payable
 
226

 
263

 
266

Total liabilities
 
2,352,531

 
2,311,483

 
2,118,547

Commitments and Contingencies
 
 
 
 
 
 
Stockholders’ Equity
 
 
 
 
 
 
Preferred stock, $0.01 par value per share; 1,000,000 shares authorized; no shares issued
 
—

 
—

 
—

Common stock $0.01 par value per share; 20,000,000 shares authorized; 11,566,722 shares issued and outstanding at March 31, 2017 (including 139,782 shares of unvested participating restricted awards), 11,475,742 shares issued and outstanding at December 31, 2016 (including 141,580 shares of unvested participating restricted awards) and 10,473,738 shares issued and outstanding at March 31, 2016 (including 155,421 shares of unvested participating restricted awards)
 
116

 
115

 
105

Additional paid-in capital
 
85,813

 
85,421

 
61,927

Retained earnings
 
134,028

 
130,008

 
119,904

Accumulated other comprehensive (loss) / income
 
(129
)
 
(758
)
 
4,149

Total stockholders’ equity
 
219,828

 
214,786

 
186,085

Total liabilities and stockholders’ equity
 
$
2,572,359

 
$
2,526,269

 
$
2,304,632




ENTERPRISE BANCORP, INC.
Consolidated Statements of Income
(unaudited)

 
 
Three months ended March 31,
(Dollars in thousands, except per share data)
 
2017
 
2016
Interest and dividend income:
 
 
 
 
Loans and loans held for sale
 
$
22,371

 
$
20,881

Investment securities
 
1,920

 
1,540

Other interest-earning assets
 
73

 
44

Total interest and dividend income
 
24,364

 
22,465

Interest expense:
 
 

 
 

Deposits
 
1,228

 
1,088

Borrowed funds
 
61

 
63

Subordinated debt
 
228

 
231

Total interest expense
 
1,517

 
1,382

Net interest income
 
22,847

 
21,083

Provision for loan losses
 
125

 
850

Net interest income after provision for loan losses
 
22,722

 
20,233

Non-interest income:
 
 

 
 

Investment advisory fees
 
1,225

 
1,104

Deposit and interchange fees
 
1,340

 
1,242

Income on bank-owned life insurance, net
 
176

 
191

Net gains on sales of investment securities
 
540

 
2

Gains on sales of loans
 
133

 
89

Other income
 
720

 
578

Total non-interest income
 
4,134

 
3,206

Non-interest expense:
 
 
 
 
Salaries and employee benefits
 
12,692

 
10,485

Occupancy and equipment expenses
 
1,939

 
1,813

Technology and telecommunications expenses
 
1,582

 
1,423

Advertising and public relations expenses
 
619

 
679

Audit, legal and other professional fees
 
363

 
457

Deposit insurance premiums
 
383

 
326

Supplies and postage expenses
 
233

 
229

Other operating expenses
 
1,609

 
1,457

Total non-interest expense
 
19,420

 
16,869

Income before income taxes
 
7,436

 
6,570

Provision for income taxes
 
1,864

 
2,257

Net income
 
$
5,572

 
$
4,313

 
 
 
 
 
Basic earnings per share
 
$
0.48

 
$
0.41

Diluted earnings per share
 
$
0.48

 
$
0.41

 
 
 
 
 
Basic weighted average common shares outstanding
 
11,508,811

 
10,405,112

Diluted weighted average common shares outstanding
 
11,598,862

 
10,471,784




ENTERPRISE BANCORP, INC.
Selected Consolidated Financial Data and Ratios
(unaudited)

(Dollars in thousands, except per share data)
 
At or for the
three months ended
March 31, 2017
 
At or for the
year ended
December 31, 2016
 
At or for the
three months ended March 31, 2016
 
 
 
 
 
 
 
 
 
BALANCE SHEET AND OTHER DATA
 
 

 
 

 
 

 
Total assets
 
$
2,572,359

 
$
2,526,269

 
$
2,304,632

 
Loans serviced for others
 
82,671

 
80,996

 
71,294

 
Investment assets under management
 
747,469

 
725,338

 
688,294

 
Total assets under management
 
$
3,402,499

 
$
3,332,603

 
$
3,064,220

 
 
 
 
 
 
 
 
 
Book value per share
 
$
19.01

 
$
18.72

 
$
17.77

 
Dividends paid per common share
 
$
0.135

 
$
0.520

 
$
0.130

 
Total capital to risk weighted assets
 
11.86
%
 
11.79
%
 
10.97
%
 
Tier 1 capital to risk weighted assets
 
9.87
%
 
9.80
%
 
8.93
%
 
Tier 1 capital to average assets
 
8.40
%
 
8.34
%
 
7.76
%
 
Common equity tier 1 capital to risk weighted assets
 
9.87
%
 
9.80
%
 
8.93
%
 
Allowance for loan losses to total loans
 
1.53
%
 
1.55
%
 
1.60
%
 
Non-performing assets
 
$
9,357

 
$
9,485

 
$
11,264

 
Non-performing assets to total assets
 
0.36
%
 
0.38
%
 
0.49
%
 
 
 
 
 
 
 
 
 
INCOME STATEMENT DATA (annualized)
 
 
 
 
 
 
 
Return on average total assets
 
0.88
%
 
0.78
%
 
0.76
%
 
Return on average stockholders’ equity
 
10.41
%
 
9.33
%
 
9.43
%
 
Net interest margin (tax equivalent)
 
3.90
%
 
3.94
%
 
4.02
%