EX-99.1 2 ex-99d1.htm EX-99.1 pfis_Ex99_1

Exhibit 99.1

NEWS RELEASE

TO BUSINESS EDITOR:

PEOPLES FINANCIAL SERVICES CORP. Reports Fourth Quarter 2018 Earnings

Scranton, PA, January 29, 2019/PRNEWSWIRE/ – Peoples Financial Services Corp. (“Peoples”) (NASDAQ: PFIS), the bank holding company for Peoples Security Bank and Trust Company, today reported unaudited financial results at and for the three and twelve months ended December 31, 2018.  Peoples reported net income of $6.4 million, or $0.86 per share for the fourth quarter of 2018, compared to $2.6 million, or $0.36 per share for the comparable period of 2017. The increase in earnings for the three months ended December 31, 2018 is the product of higher net interest income of $1.6 million due to growth in our average earning assets of $138.5 million from the year ago period and a reduction in income taxes due to the Tax Cuts and Jobs Act of 2017 (TCJA), which reduced the Company’s statutory federal tax rate from 35% to 21% effective January 1, 2018 and resulted in a one-time tax charge of $2.6 million, or $0.35 per share for the three months ending December 31, 2017.  

Net income for the twelve months ended December 31, 2018, totaled $24.9 million or $3.37 per share, a 35.0% increase compared to $18.5 million or $2.50 per share for the same period last year.  The increase in earnings for the twelve months ended December 31, 2018 is the result of higher net interest income of $5.8 million due to our earning asset growth coupled with the $4.8 million reduction in income taxes due to the lower corporate tax rate. These increases were partially offset by lower noninterest income in the amount of $3.5 million due in part to the sale of our merchant services business in the second quarter of 2017.

In addition to evaluating its results of operations in accordance with GAAP, Peoples routinely supplements its evaluation with an analysis of certain non-GAAP financial measures, such as tangible stockholders’ equity and core net income ratios. The reported results included herein contain items, which Peoples considers non-core, namely gains and losses incurred within investment securities available-for-sale, gains on the sale of other business lines and the non-recurring tax provision related to the TCJA. Peoples believes the reported non-GAAP financial measures provide information useful to investors in understanding its operating performance and trends. Where non-GAAP disclosures are used in this press release, a reconciliation to the comparable GAAP measure is provided in the accompanying tables. The non-GAAP financial measures Peoples uses may differ from the non-GAAP financial measures of other financial institutions.

Core net income, which we have defined to exclude gains or losses on investment securities and gains from other nonrecurring sources, for the three months ended December 31, totaled $6.4 million and $5.3 million in 2018 and 2017, respectively. Core net income per share for the three months ended December 31, 2018 was $0.86, an increase from $0.71 for the same period in 2017. Core net income in 2017 excludes the one-time tax charge in the amount of $2.6 million resulting from the revaluation of the Company’s net deferred tax asset related to the TCJA.

Core net income for the twelve months ended December 31, 2018 was $24.7 million or $3.34 per share, a 24.8% increase compared to $19.8 million or $2.67 per share for the same period of 2017. Results for the twelve months ended December 31, 2018 exclude a  pre-tax $14 thousand gain in the value of our equity investment securities portfolio and a nonrecurring pre-tax gain of $291 thousand from the sale of our credit card portfolio during the second quarter. The 2017 results were impacted by the pre-tax gain of $2.3 million from the sale of our merchant services business which was offset by an additional one-time federal income tax expense in the amount of $2.6 million related to the TCJA.

 

NOTABLES

·

Loans, net growth of $130.2 million or 7.7% for the twelve months ended December 31, 2018.

·

Deposits grew $156.0 million or 9.1% for the twelve months ended December 31, 2018.

·

Tangible book value per share improved to $28.84 at December 31, 2018 from $27.99 at September 30, 2018 and from $26.83 at December 31, 2017.

1

 

·

Tax-equivalent net interest income increased $4.1 million or 6.0% to $73.0 million for the twelve months ended December 31, 2018 compared to $68.9 million for the same period in 2017.

·

Return on average assets was 1.12% for the three and twelve months ended December 31, 2018.

·

Nonperforming assets to loans, net, and foreclosed assets decreased to 0.55% at December 31, 2018, from 0.65% at September 30, 2018 and 0.68% at December 31, 2017.

·

The effective tax rate decreased to 12.0% for the twelve months ended December 31, 2018 resulting from the tax reform legislation enacted in December 2017. This compares favorably to 30.7% for the same period in 2017.

·

We opened a limited purpose banking office in Orwigsburg, Schuylkill County, Pennsylvania in the fourth quarter of 2018.

 

 INCOME STATEMENT REVIEW

Our tax-equivalent net interest margin for the three and twelve months ended December 31  were 3.63% and 3.59%  respectively in 2018, compared to 3.63% and 3.69% respectively for the same periods in 2017. Yields and interest income on our tax-exempt loans and investment securities were computed on a taxable-equivalent basis assuming a 21% tax rate in 2018 and a 35% tax rate in 2017, reflecting the 21% statutory tax rate that became effective for Peoples on January 1, 2018, under the TCJA of 2017. The tax-equivalent yield on earning assets increased 25 basis points and 8 basis points respectively for the three and twelve months ended December 31, 2018 from the corresponding period of 2017. At the same time, we experienced higher interest-bearing liability costs due to increases in short-term market rates. The 33 basis point and 25 basis point increase, respectively to our cost of funds, which represents our average rate paid on total interest-bearing liabilities, for the three and twelve months ended December 31, 2018 when compared to those same periods in 2017 caused the tax-equivalent net interest margin to remain level for the quarter while the increase in cost of funds for the twelve month period more than offset increases to the yield on earning assets causing the decrease for the annual period.

Tax-equivalent net interest income for the twelve months ended December 31, increased $4.1 million or 6.0% to $73.0 million in 2018 from $68.9 million in 2017. The increase in tax equivalent net interest income was primarily due to a $170.4 million increase in average earning assets for the twelve months ended December 31, 2018 when compared to the same period in 2017. The tax-equivalent yield on the loan portfolio increased to 4.51% for the twelve months ended December 31, 2018, compared to 4.39% for the comparable period in 2017. The tax-equivalent yield on the loan portfolio for the twelve months ended December 31, 2018 would have been 4.56% had it been calculated using the 35% tax rate. Loans, net averaged $1.8 billion for the twelve months ended December 31, 2018 and $1.6 billion for the comparable period in 2017. For the twelve months ended December 31, the tax-equivalent yield on total investments decreased to 2.60% in 2018 from 2.84% in 2017. The tax-equivalent yield on total investments would have increased to 2.86% for the twelve months ended December 31, 2018 had it been calculated using the 35% tax rate. Average investments totaled $281.7 million in 2018 and $272.4 million in 2017. Average interest-bearing liabilities increased $127.2 million for the twelve months ended December 31, 2018, compared to the corresponding period last year. The cost of funds, which represents our average rate paid on total interest-bearing liabilities, increased to 0.86% in the twelve months ended December 31, 2018 from 0.61% for the same period of 2017 due to increases in short-term interest rates, the result of the Federal Open Market Committee’s (FOMC) actions to increase the federal funds rate 100 basis points in 2018.  

For the twelve months ended December 31, noninterest income totaled $13.7 million in 2018, a decrease from $17.2 million in 2017. The gain on sale of our credit card portfolio was $291 thousand and gains on investment securities were $14 thousand in 2018 compared to a gain on the sale of our merchant services portfolio of $2.3 million in 2017. Otherwise, increases in service charges, fees and commissions, which included bank owned life insurance (“BOLI”) proceeds and higher dividend income received on Federal Home Loan Bank (“FHLB”) stock, and income generated from wealth management services partially offset decreases in revenues from merchant services, income from fiduciary activities, revenues generated from interest rate swap transactions, income from mortgage banking activities and life insurance investment income. For the three months ended December 31, noninterest income totaled $3.2 million in 2018, a decrease from $3.4  million in the comparable 2017 period. Decreases in service charges, fees and commissions was due to lower revenue generated from interest rate swap transactions during the three months ended December 31, 2018 when compared to the corresponding year ago period.  

2

 

Noninterest expense increased $1.2 million or 2.3% to $52.5 million for the twelve months ended December 31, 2018, from $51.3 million for the twelve months ended December 31, 2017. Salaries and employee benefits increased $1.7 million or 6.5% due to merit increases and continued investment in our expansion markets in the Lehigh Valley and King of Prussia. Occupancy and equipment expenses also increased due to our market expansion when comparing the twelve months ending December 31, 2018 and 2017 as those expenses increased $922 thousand or 9.2%. Offsetting the increase in salaries and occupancy expenses, merchant services related expenses decreased $1.8 million for the twelve months ended December 31, 2018 due to the sale of our merchant business in the second quarter of 2017. Rounding out the twelve months ended December 31, 2018, decreases to other expenses and amortization of intangibles expense were more than offset by increases in FDIC insurance and assessments, professional fees and outside services and donations. For the fourth quarter of 2018, noninterest expense increased to $13.4 million compared $12.5 million for the same period in 2017. As with the results for the twelve months ended December 31, 2018, the buildout of our expansion plan led to increases in salaries and employee benefit expense as well as occupancy expenses when comparing the two periods. Also increasing were professional fees and outside services, FDIC insurance and assessments, donation and other expenses with only minimal decreases to merchant services costs and amortization expense.

 

 BALANCE SHEET REVIEW

At December 31, 2018, total assets, loans and deposits were $2.3 billion, $1.8 billion and $1.9 billion, respectively. Loans, net increased $130.2 million, or 7.7% from December 31, 2017. The growth in loans was primarily from commercial real estate. Total deposits grew $156.0 million, or 9.1% from December 31, 2017, including $50 million in callable brokered certificates of deposit.  Non-interest bearing deposits increased $29.5 million or 7.8% while interest–bearing deposits increased $126.5 million or 9.5% during the twelve months ended December 31, 2018. Short-term borrowings decreased $37.2 million in conjunction with the increase in deposits. Total investments were $278.3 million at December 31, 2018, including $269.7 million securities classified as available-for-sale and $8.4 million classified as held-to-maturity.

Stockholders’ equity equaled $279.1 million or $37.72 per share at December 31, 2018, and $265.0 million or $35.82 per share at December 31, 2017. Tangible stockholders’ equity improved to $28.84 per share at December 31, 2018, from $26.83 per share at December 31, 2017. Dividends declared for the twelve months ended December 31, 2018 amounted to $1.31 per share, a 4.0% increase from the year ago period, representing a dividend payout ratio of 38.9%.

ASSET QUALITY REVIEW

Nonperforming assets were $10.0 million or 0.55% of loans, net and foreclosed assets at December 31, 2018, compared to $11.6 million or 0.68% of loans, net and foreclosed assets at December 31, 2017. The allowance for loan losses equaled $21.4 million or 1.17% of loans, net at December 31, 2018 compared to $19.0 million or 1.12% of loans, net, at December 31, 2017. Loans charged-off, net of recoveries, for the twelve months ended December 31, 2018, equaled $1.8 million or 0.10% of average loans, compared to $1.8 million or 0.11% of average loans for the comparable period last year.

About Peoples:

Peoples Financial Services Corp. is the parent company of Peoples Security Bank and Trust Company, a community bank serving Bucks, Lackawanna, Lehigh, Luzerne, Monroe, Montgomery, Northampton, Schuylkill, Susquehanna, Wayne and Wyoming Counties in Pennsylvania and Broome County in New York through 27 offices. Each office, interdependent with the community, offers a comprehensive array of financial products and services to individuals, businesses, not-for-profit organizations and government entities. Peoples’ business philosophy includes offering direct access to senior management and other officers and providing friendly, informed and courteous service, local and timely decision making, flexible and reasonable operating procedures and consistently applied credit policies.

 

 

 

SOURCE: Peoples Financial Services Corp.

/Contact: 

MEDIA/INVESTORS, Marie L. Luciani, Investor Relations Officer, 570.346.7741 or marie.luciani@psbt.com

Co:

Peoples Financial Services Corp.

St:

Pennsylvania

In:

Fin

3

 

Safe Harbor Forward-Looking Statements:

We make statements in this press release, and we may from time to time make other statements regarding our outlook or expectations for future financial or operating results and/or other matters regarding or affecting Peoples Financial Services Corp., Peoples Security Bank and Trust Company, and its subsidiaries (collectively, “Peoples”) that are considered “forward-looking statements” as defined in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such forward-looking statements may be identified by the use of such words as “believe,” “expect,” “anticipate,” “should,” “planned,” “estimated,” “intend” and “potential.” For these statements, Peoples claims the protection of the statutory safe harbors for forward-looking statements.

Peoples cautions you that a number of important factors could cause actual results to differ materially from those currently anticipated in any forward-looking statement. Such factors include, but are not limited to: prevailing economic and political conditions, particularly in our market area; credit risk associated with our lending activities; changes in interest rates, loan demand, real estate values and competition; changes in accounting principles, policies, and guidelines; changes in any applicable law, rule, regulation or practice with respect to tax or legal issues; our ability to identify and address cyber-security risks and other economic, competitive, governmental, regulatory and technological factors affecting Peoples’ operations, pricing, products and services and other factors that may be described in Peoples’ Annual Reports on Form 10-K and Quarterly Reports on Form 10-Q as filed with the Securities and Exchange Commission from time to time.

In addition to these risks, acquisitions and business combinations, present risks other than those presented by the nature of the business acquired. Acquisitions and business combinations may be substantially more expensive to complete than originally anticipated, and the anticipated benefits may be significantly harder-or take longer-to achieve than expected. As regulated financial institutions, our pursuit of attractive acquisition and business combination opportunities could be negatively impacted by regulatory delays or other regulatory issues. Regulatory and/or legal issues related to the pre-acquisition operations of an acquired or combined business may cause reputational harm to Peoples following the acquisition or combination, and integration of the acquired or combined business with ours may result in additional future costs arising as a result of those issues.

 

 The forward-looking statements are made as of the date of this release, and, except as may be required by applicable law or regulation, Peoples assumes no obligation to update the forward-looking statements or to update the reasons why actual results could differ from those projected in the forward-looking statements.

 

[TABULAR MATERIAL FOLLOWS]

 

4

 

Summary Data

Peoples Financial Services Corp.

Five Quarter Trend

(In thousands, except share and per share data)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

  

Dec 31

  

Sept 30

  

June 30

  

Mar 31

  

Dec 31

 

 

 

2018

 

2018

 

2018

 

2018

 

2017

 

Key performance data:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Per share data:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income

 

$

0.86

 

$

0.91

 

$

0.81

 

$

0.79

 

$

0.36

 

Core net income (1)

 

$

0.86

 

$

0.91

 

$

0.77

 

$

0.79

 

$

0.71

 

Cash dividends declared

 

$

0.33

 

$

0.33

 

$

0.33

 

$

0.32

 

$

0.32

 

Book value

 

$

37.72

 

$

36.89

 

$

36.43

 

$

36.05

 

$

35.82

 

Tangible book value (1)

 

$

28.84

 

$

27.99

 

$

27.50

 

$

27.08

 

$

26.83

 

Market value:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

High

 

$

44.06

 

$

48.10

 

$

51.68

 

$

47.53

 

$

51.06

 

Low

 

$

40.00

 

$

42.40

 

$

43.72

 

$

41.06

 

$

44.04

 

Closing

 

$

44.06

 

$

42.40

 

$

47.02

 

$

45.65

 

$

46.58

 

Market capitalization

 

$

326,002

 

$

313,720

 

$

347,904

 

$

337,650

 

$

344,529

 

Common shares outstanding

 

 

7,399,054

 

 

7,399,054

 

 

7,399,054

 

 

7,396,505

 

 

7,396,505

 

Selected ratios:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Return on average stockholders’ equity

 

 

9.21

% 

 

9.81

% 

 

8.90

% 

 

8.89

% 

 

3.92

% 

Core return on average stockholders’ equity (1)

 

 

9.21

% 

 

9.79

% 

 

8.55

% 

 

8.90

% 

 

7.81

% 

Return on average tangible stockholders’ equity

 

 

12.10

% 

 

12.95

% 

 

11.81

% 

 

11.84

% 

 

5.22

% 

Core return on average tangible stockholders’ equity (1)

 

 

12.10

% 

 

12.93

% 

 

11.34

% 

 

11.85

% 

 

10.39

% 

Return on average assets

 

 

1.12

%

 

1.19

%

 

1.08

%

 

1.08

%

 

0.49

%

Core return on average assets (1)

 

 

1.12

% 

 

1.19

% 

 

1.03

% 

 

1.08

% 

 

0.98

% 

Stockholders’ equity to total assets

 

 

12.20

% 

 

12.09

% 

 

12.06

% 

 

12.17

% 

 

12.21

% 

Efficiency ratio (2)

 

 

59.42

% 

 

57.00

% 

 

61.98

% 

 

60.69

% 

 

57.81

% 

Nonperforming assets to loans, net, and foreclosed assets

 

 

0.55

% 

 

0.65

% 

 

0.63

% 

 

0.72

% 

 

0.68

% 

Net charge-offs to average loans, net

 

 

0.02

% 

 

0.05

% 

 

0.28

% 

 

0.07

% 

 

0.26

% 

Allowance for loan losses to loans, net

 

 

1.17

% 

 

1.15

% 

 

1.12

% 

 

1.14

% 

 

1.12

% 

Interest-bearing assets yield (FTE) (3)

 

 

4.38

% 

 

4.25

% 

 

4.20

% 

 

4.14

% 

 

4.13

% 

Cost of funds

 

 

0.99

% 

 

0.89

% 

 

0.81

% 

 

0.74

% 

 

0.66

% 

Net interest spread (FTE) (3)

 

 

3.39

% 

 

3.36

% 

 

3.39

% 

 

3.40

% 

 

3.47

% 

Net interest margin (FTE) (3)

 

 

3.63

% 

 

3.57

% 

 

3.58

% 

 

3.57

% 

 

3.63

% 

(1)

See Reconciliation of Non-GAAP financial measures.

(2)

Total noninterest expense less amortization of intangible assets divided by tax-equivalent net interest income and noninterest income less net gains(losses) on investment securities available-for-sale.

(3)

Tax-equivalent adjustments were calculated using the federal statutory tax rate prevailing during the indicated periods of 21% in 2018 and 35% in 2017.

5

 

Peoples Financial Services Corp.

Consolidated Statements of Income

(In thousands, except per share data)

 

 

 

 

 

 

 

 

 

 

    

Dec 31

    

Dec 31

 

Year Ended

 

2018

 

2017

 

Interest income:

 

 

 

 

 

 

 

Interest and fees on loans:

 

 

 

 

 

 

 

Taxable

 

$

74,352

 

$

64,946

 

Tax-exempt

 

 

3,666

 

 

3,163

 

Interest and dividends on investment securities:

 

 

 

 

 

 

 

Taxable

 

 

3,942

 

 

2,949

 

Tax-exempt

 

 

2,621

 

 

2,999

 

Dividends

 

 

72

 

 

52

 

Interest on interest-bearing deposits in other banks

 

 

 8

 

 

133

 

Total interest income

 

 

84,661

 

 

74,242

 

Interest expense:

 

 

 

 

 

 

 

Interest on deposits

 

 

9,346

 

 

6,450

 

Interest on short-term borrowings

 

 

2,738

 

 

900

 

Interest on long-term debt

 

 

1,238

 

 

1,348

 

Total interest expense

 

 

13,322

 

 

8,698

 

Net interest income

 

 

71,339

 

 

65,544

 

Provision for loan losses

 

 

4,200

 

 

4,800

 

Net interest income after provision for loan losses

 

 

67,139

 

 

60,744

 

Noninterest income:

 

 

 

 

 

 

 

Service charges, fees, commissions

 

 

7,678

 

 

7,344

 

Merchant services income

 

 

809

 

 

2,543

 

Commissions and fees on fiduciary activities

 

 

2,036

 

 

2,057

 

Wealth management income

 

 

1,447

 

 

1,411

 

Mortgage banking income

 

 

627

 

 

784

 

Life insurance investment income

 

 

757

 

 

769

 

Net gain on investment securities

 

 

14

 

 

 

 

Net gain on sale of credit card loans

 

 

291

 

 

 

 

Net gains on sale of merchant services business

 

 

 

 

 

2,278

 

Total noninterest income

 

 

13,659

 

 

17,186

 

Noninterest expense:

 

 

 

 

 

 

 

Salaries and employee benefits expense

 

 

28,407

 

 

26,670

 

Net occupancy and equipment expense

 

 

10,897

 

 

9,975

 

Merchant services expense

 

 

 9

 

 

1,808

 

Amortization of intangible assets

 

 

881

 

 

1,034

 

Other expenses

 

 

12,293

 

 

11,806

 

Total noninterest expense

 

 

52,487

 

 

51,293

 

Income before income taxes

 

 

28,311

 

 

26,637

 

Provision for income tax expense

 

 

3,391

 

 

8,180

 

Net income

 

$

24,920

 

$

18,457

 

Other comprehensive income (loss):

 

 

 

 

 

 

 

Unrealized losses on investment securities available-for-sale

 

$

(2,014)

 

$

(1,790)

 

Change in pension liability

 

 

 

 

 

318

 

Change in value-interest rate floor

 

 

246

 

 

 

 

Income tax related to other comprehensive income

 

 

(371)

 

 

(515)

 

Other comprehensive loss, net of income taxes

 

 

(1,397)

 

 

(957)

 

Comprehensive income

 

$

23,523

 

$

17,500

 

Per share data:

 

 

 

 

 

 

 

Net income

 

$

3.37

 

$

2.50

 

Cash dividends declared

 

$

1.31

 

$

1.26

 

Average common shares outstanding

 

 

7,397,797

 

 

7,395,837

 

 

 

6

 

Peoples Financial Services Corp.

Consolidated Statements of Income

(In thousands, except per share data)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    

Dec 31

    

Sept 30

    

June 30

    

Mar 31

    

Dec 31

 

Three months ended

 

2018

 

2018

 

2018

 

2018

 

2017

 

Interest income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest and fees on loans:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Taxable

 

$

19,806

 

$

18,798

 

$

18,239

 

$

17,509

 

$

16,925

 

Tax-exempt

 

 

1,006

 

 

919

 

 

871

 

 

870

 

 

829

 

Interest and dividends on investment securities available-for-sale:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Taxable

 

 

1,009

 

 

998

 

 

934

 

 

858

 

 

819

 

Tax-exempt

 

 

620

 

 

639

 

 

661

 

 

701

 

 

737

 

Dividends

 

 

21

 

 

16

 

 

19

 

 

16

 

 

15

 

Interest on interest-bearing deposits in other banks

 

 

20

 

 

49

 

 

42

 

 

40

 

 

26

 

Total interest income

 

 

22,482

 

 

21,419

 

 

20,766

 

 

19,994

 

 

19,351

 

Interest expense:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest on deposits

 

 

3,211

 

 

2,342

 

 

1,959

 

 

1,834

 

 

1,833

 

Interest on short-term borrowings

 

 

421

 

 

809

 

 

841

 

 

667

 

 

301

 

Interest on long-term debt

 

 

302

 

 

315

 

 

315

 

 

306

 

 

307

 

Total interest expense

 

 

3,934

 

 

3,466

 

 

3,115

 

 

2,807

 

 

2,441

 

Net interest income

 

 

18,548

 

 

17,953

 

 

17,651

 

 

17,187

 

 

16,910

 

Provision for loan losses

 

 

1,050

 

 

1,050

 

 

1,050

 

 

1,050

 

 

1,200

 

Net interest income after provision for loan losses

 

 

17,498

 

 

16,903

 

 

16,601

 

 

16,137

 

 

15,710

 

Noninterest income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Service charges, fees, commissions

 

 

1,822

 

 

1,883

 

 

1,885

 

 

2,088

 

 

1,934

 

Merchant services income

 

 

122

 

 

128

 

 

309

 

 

250

 

 

185

 

Commissions and fees on fiduciary activities

 

 

484

 

 

570

 

 

485

 

 

497

 

 

515

 

Wealth management income

 

 

399

 

 

305

 

 

332

 

 

411

 

 

330

 

Mortgage banking income

 

 

155

 

 

163

 

 

162

 

 

147

 

 

208

 

Life insurance investment income

 

 

189

 

 

190

 

 

191

 

 

187

 

 

192

 

Net gain (loss) on investment securities

 

 

 

 

 

14

 

 

 8

 

 

(8)

 

 

 

 

Net gain on sale of credit card loans

 

 

 

 

 

 

 

 

291

 

 

 

 

 

 

 

Total noninterest income

 

 

3,171

 

 

3,253

 

 

3,663

 

 

3,572

 

 

3,364

 

Noninterest expense:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Salaries and employee benefits expense

 

 

7,116

 

 

6,946

 

 

7,390

 

 

6,955

 

 

6,819

 

Net occupancy and equipment expense

 

 

2,682

 

 

2,681

 

 

2,720

 

 

2,814

 

 

2,648

 

Merchant services expense

 

 

 3

 

 

 3

 

 

 1

 

 

 2

 

 

12

 

Amortization of intangible assets

 

 

211

 

 

220

 

 

220

 

 

230

 

 

249

 

Other expenses

 

 

3,361

 

 

2,687

 

 

3,165

 

 

3,080

 

 

2,727

 

Total noninterest expense

 

 

13,373

 

 

12,537

 

 

13,496

 

 

13,081

 

 

12,455

 

Income before income taxes

 

 

7,296

 

 

7,619

 

 

6,768

 

 

6,628

 

 

6,619

 

Income tax expense

 

 

904

 

 

902

 

 

811

 

 

774

 

 

3,971

 

Net income

 

$

6,392

 

$

6,717

 

$

5,957

 

$

5,854

 

$

2,648

 

Other comprehensive income (loss):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Unrealized gains (losses) on investment securities available-for-sale

 

$

2,380

 

$

(1,179)

 

$

(839)

 

$

(2,376)

 

$

(2,866)

 

Change in pension liability

 

 

 

 

 

 

 

 

 

 

 

 

 

 

318

 

Change in value-interest rate floor

 

 

246

 

 

 

 

 

 

 

 

 

 

 

 

 

Income tax related to other comprehensive income (loss)

 

 

554

 

 

(248)

 

 

(176)

 

 

(501)

 

 

(892)

 

Reclassification related to tax reform legislation

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1,101)

 

Other comprehensive income (loss), net of income taxes

 

 

2,072

 

 

(931)

 

 

(663)

 

 

(1,875)

 

 

(2,757)

 

Comprehensive income (loss)

 

$

8,464

 

$

5,786

 

$

5,294

 

$

3,979

 

$

(109)

 

Per share data:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income

 

$

0.86

 

$

0.91

 

$

0.81

 

$

0.79

 

$

0.36

 

Cash dividends declared

 

$

0.33

 

$

0.33

 

$

0.33

 

$

0.32

 

$

0.32

 

Average common shares outstanding

 

 

7,399,054

 

 

7,399,054

 

 

7,396,533

 

 

7,396,505

 

 

7,396,505

 

 

7

 

Peoples Financial Services Corp.

Details of Net Interest and Net Interest Margin

(In thousands, fully taxable equivalent basis)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    

Dec 31

    

Sept 30

    

June 30

    

Mar 31

    

Dec 31

 

Three months ended

 

2018

 

2018

 

2018

 

2018

 

2017

 

Net interest income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loans, net:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Taxable

 

$

19,806

 

$

18,798

 

$

18,239

 

$

17,509

 

$

16,925

 

Tax-exempt

 

 

1,274

 

 

1,162

 

 

1,103

 

 

1,101

 

 

1,274

 

Total loans, net

 

 

21,080

 

 

19,960

 

 

19,342

 

 

18,610

 

 

18,199

 

Investments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Taxable

 

 

1,047

 

 

1,062

 

 

993

 

 

912

 

 

858

 

Tax-exempt

 

 

785

 

 

811

 

 

835

 

 

887

 

 

1,133

 

Total investments

 

 

1,832

 

 

1,873

 

 

1,828

 

 

1,799

 

 

1,991

 

Interest on interest-bearing balances in other banks

 

 

 3

 

 

 1

 

 

 2

 

 

 2

 

 

 2

 

Federal funds sold

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total interest income

 

 

22,915

 

 

21,834

 

 

21,172

 

 

20,411

 

 

20,192

 

Interest expense:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deposits

 

 

3,211

 

 

2,342

 

 

1,959

 

 

1,834

 

 

1,833

 

Short-term borrowings

 

 

421

 

 

809

 

 

841

 

 

667

 

 

301

 

Long-term debt

 

 

302

 

 

315

 

 

315

 

 

306

 

 

307

 

Total interest expense

 

 

3,934

 

 

3,466

 

 

3,115

 

 

2,807

 

 

2,441

 

Net interest income

 

$

18,981

 

$

18,368

 

$

18,057

 

$

17,604

 

$

17,751

 

Loans, net:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Taxable

 

 

4.73

%  

 

4.57

%  

 

4.52

%  

 

4.45

%  

 

4.36

%

Tax-exempt

 

 

3.80

%  

 

3.74

%  

 

3.60

%  

 

3.57

%  

 

4.36

%

Total loans, net

 

 

4.66

%  

 

4.51

%  

 

4.46

%  

 

4.38

%  

 

4.36

%

Investments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Taxable

 

 

2.25

%  

 

2.28

%  

 

2.23

%  

 

2.15

%  

 

2.00

%

Tax-exempt

 

 

3.25

%  

 

3.25

%  

 

3.24

%  

 

3.33

%  

 

4.09

%

Total investments

 

 

2.60

%  

 

2.62

%  

 

2.60

%  

 

2.61

%  

 

2.82

%

Interest-bearing balances with banks

 

 

2.28

%  

 

1.05

%  

 

2.35

%  

 

1.74

%  

 

0.74

%

Federal funds sold

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total interest-bearing assets

 

 

4.38

%  

 

4.25

%  

 

4.20

%  

 

4.14

%  

 

4.13

%

Interest expense:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deposits

 

 

0.87

%  

 

0.69

%  

 

0.59

%  

 

0.56

%  

 

0.54

%

Short-term borrowings

 

 

2.56

%  

 

2.23

%  

 

2.06

%  

 

1.66

%  

 

1.43

%

Long-term debt

 

 

2.63

%  

 

2.57

%  

 

2.57

%  

 

2.51

%  

 

2.44

%

Total interest-bearing liabilities

 

 

0.99

%  

 

0.89

%  

 

0.81

%  

 

0.74

%  

 

0.66

%

Net interest spread

 

 

3.39

%  

 

3.36

%  

 

3.39

%  

 

3.40

%  

 

3.47

%

Net interest margin

 

 

3.63

%  

 

3.57

%  

 

3.58

%  

 

3.57

%  

 

3.63

%

 

8

 

Peoples Financial Services Corp.

Consolidated Balance Sheets

(In thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    

Dec 31

    

Sept 30

    

June 30

    

Mar 31

    

Dec 31

 

At period end

 

2018

 

2018

 

2018

 

2018

 

2017

 

Assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash and due from banks

 

$

32,569

 

$

40,458

 

$

35,249

 

$

26,699

 

$

36,336

 

Interest-bearing balances in other banks

 

 

47

 

 

137

 

 

130

 

 

76

 

 

1,152

 

Federal funds sold

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Investment securities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Available-for-sale

 

 

269,682

 

 

274,794

 

 

275,050

 

 

271,378

 

 

272,502

 

Equity investments carried at fair value

 

 

291

 

 

291

 

 

278

 

 

189

 

 

46

 

Held-to-maturity

 

 

8,361

 

 

8,551

 

 

8,780

 

 

9,028

 

 

9,274

 

Loans held for sale

 

 

749

 

 

98

 

 

 

 

 

 

 

 

106

 

Loans, net

 

 

1,823,266

 

 

1,779,445

 

 

1,753,389

 

 

1,725,781

 

 

1,693,065

 

Less: allowance for loan losses

 

 

21,379

 

 

20,413

 

 

19,573

 

 

19,718

 

 

18,960

 

Net loans

 

 

1,801,887

 

 

1,759,032

 

 

1,733,816

 

 

1,706,063

 

 

1,674,105

 

Premises and equipment, net

 

 

38,889

 

 

37,467

 

 

37,148

 

 

37,511

 

 

37,557

 

Accrued interest receivable

 

 

7,115

 

 

6,565

 

 

6,802

 

 

6,482

 

 

6,936

 

Goodwill

 

 

63,370

 

 

63,370

 

 

63,370

 

 

63,370

 

 

63,370

 

Other intangible assets, net

 

 

2,296

 

 

2,507

 

 

2,727

 

 

2,948

 

 

3,178

 

Other assets

 

 

62,933

 

 

64,573

 

 

72,276

 

 

66,644

 

 

64,469

 

Total assets

 

$

2,288,189

 

$

2,257,843

 

$

2,235,626

 

$

2,190,388

 

$

2,169,031

 

Liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deposits:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest-bearing

 

$

410,260

 

$

404,293

 

$

400,518

 

$

394,729

 

$

380,729

 

Interest-bearing

 

 

1,464,762

 

 

1,423,571

 

 

1,318,343

 

 

1,325,289

 

 

1,338,289

 

Total deposits

 

 

1,875,022

 

 

1,827,864

 

 

1,718,861

 

 

1,720,018

 

 

1,719,018

 

Short-term borrowings

 

 

86,500

 

 

99,450

 

 

187,450

 

 

142,500

 

 

123,675

 

Long-term debt

 

 

37,906

 

 

48,461

 

 

48,911

 

 

49,265

 

 

49,734

 

Accrued interest payable

 

 

1,195

 

 

745

 

 

538

 

 

518

 

 

497

 

Other liabilities

 

 

8,486

 

 

8,352

 

 

10,322

 

 

11,463

 

 

11,131

 

Total liabilities

 

 

2,009,109

 

 

1,984,872

 

 

1,966,082

 

 

1,923,764

 

 

1,904,055

 

Stockholders’ equity:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common stock

 

 

14,788

 

 

14,798

 

 

14,798

 

 

14,793

 

 

14,793

 

Capital surplus

 

 

135,320

 

 

135,226

 

 

135,143

 

 

135,080

 

 

135,043

 

Retained earnings

 

 

136,582

 

 

132,631

 

 

128,356

 

 

124,841

 

 

121,353

 

Accumulated other comprehensive loss

 

 

(7,610)

 

 

(9,684)

 

 

(8,753)

 

 

(8,090)

 

 

(6,213)

 

Total stockholders’ equity

 

 

279,080

 

 

272,971

 

 

269,544

 

 

266,624

 

 

264,976

 

Total liabilities and stockholders’ equity

 

$

2,288,189

 

$

2,257,843

 

$

2,235,626

 

$

2,190,388

 

$

2,169,031

 

 

9

 

Peoples Financial Services Corp.

Consolidated Balance Sheets

(In thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    

Dec 31

    

Sept 30

    

June 30

    

Mar 31

    

Dec 31

 

Average quarterly balances

 

2018

 

2018

 

2018

 

2018

 

2017

 

Assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loans, net:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Taxable

 

$

1,662,290

 

$

1,632,012

 

$

1,616,729

 

$

1,596,493

 

$

1,540,356

 

Tax-exempt

 

 

133,100

 

 

123,199

 

 

122,876

 

 

125,142

 

 

116,055

 

Total loans, net

 

 

1,795,390

 

 

1,755,211

 

 

1,739,605

 

 

1,721,635

 

 

1,656,411

 

Investments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Taxable

 

 

184,345

 

 

184,623

 

 

178,957

 

 

171,634

 

 

169,973

 

Tax-exempt

 

 

95,698

 

 

99,142

 

 

103,279

 

 

107,917

 

 

109,979

 

Total investments

 

 

280,043

 

 

283,765

 

 

282,236

 

 

279,551

 

 

279,952

 

Interest-bearing balances with banks

 

 

523

 

 

377

 

 

342

 

 

467

 

 

1,069

 

Federal funds sold

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total interest-bearing assets

 

 

2,075,956

 

 

2,039,353

 

 

2,022,183

 

 

2,001,653

 

 

1,937,432

 

Other assets

 

 

186,491

 

 

198,229

 

 

195,919

 

 

194,928

 

 

195,815

 

Total assets

 

$

2,262,447

 

$

2,237,582

 

$

2,218,102

 

$

2,196,581

 

$

2,133,247

 

Liabilities and stockholders’ equity:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deposits:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-bearing

 

$

1,459,155

 

$

1,351,709

 

$

1,327,036

 

$

1,323,993

 

$

1,338,282

 

Noninterest-bearing

 

 

403,488

 

 

405,671

 

 

394,461

 

 

377,124

 

 

376,888

 

Total deposits

 

 

1,862,643

 

 

1,757,380

 

 

1,721,497

 

 

1,701,117

 

 

1,715,170

 

Short-term borrowings

 

 

65,192

 

 

144,162

 

 

163,596

 

 

162,965

 

 

83,791

 

Long-term debt

 

 

45,503

 

 

48,670

 

 

49,136

 

 

49,486

 

 

49,949

 

Other liabilities

 

 

13,794

 

 

15,609

 

 

15,376

 

 

16,054

 

 

16,411

 

Total liabilities

 

 

1,987,132

 

 

1,965,821

 

 

1,949,605

 

 

1,929,622

 

 

1,865,321

 

Stockholders’ equity

 

 

275,315

 

 

271,761

 

 

268,497

 

 

266,959

 

 

267,926

 

Total liabilities and stockholders’ equity

 

$

2,262,447

 

$

2,237,582

 

$

2,218,102

 

$

2,196,581

 

$

2,133,247

 

 

10

 

Peoples Financial Services Corp.

Asset Quality Data

(In thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    

Dec 31

    

Sept 30

    

June 30

    

Mar 31

    

Dec 31

 

 

 

2018

 

2018

 

2018

 

2018

 

2017

 

At quarter end

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Nonperforming assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Nonaccrual/restructured loans

 

$

8,669

 

$

10,576

 

$

10,424

 

$

11,283

 

$

10,559

 

Accruing loans past due 90 days or more

 

 

923

 

 

584

 

 

84

 

 

435

 

 

734

 

Foreclosed assets

 

 

376

 

 

342

 

 

500

 

 

685

 

 

284

 

Total nonperforming assets

 

$

9,968

 

$

11,502

 

$

11,008

 

$

12,403

 

$

11,577

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three months ended

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Allowance for loan losses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Beginning balance

 

$

20,413

 

$

19,573

 

$

19,718

 

$

18,960

 

$

18,831

 

Charge-offs

 

 

202

 

 

328

 

 

1,398

 

 

426

 

 

1,139

 

Recoveries

 

 

118

 

 

118

 

 

203

 

 

134

 

 

68

 

Provision for loan losses

 

 

1,050

 

 

1,050

 

 

1,050

 

 

1,050

 

 

1,200

 

Ending balance

 

$

21,379

 

$

20,413

 

$

19,573

 

$

19,718

 

$

18,960

 

 

11

 

Peoples Financial Services Corp.

Reconciliation of Non-GAAP Financial Measures

(In thousands, except share and per share data)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    

Dec 31

    

Sept 30

 

June 30

    

Mar 31

    

Dec 31

 

Three months ended

 

2018

 

2018

 

2018

 

2018

 

2017

 

Core net income per share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income GAAP

 

$

6,392

 

$

6,717

 

$

5,957

 

$

5,854

 

$

2,648

 

Adjustments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Less: Gain on sale of business line

 

 

 

 

 

 

 

 

291

 

 

 

 

 

 

 

Add: (gains) losses on investment securities

 

 

 

 

 

(14)

 

 

(8)

 

 

 8

 

 

 

 

Less: (gains) losses on investment securities tax adjustment

 

 

 

 

 

(3)

 

 

(2)

 

 

 2

 

 

 

 

Add: Expenses related to sale of merchant services business

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Add: Gain on sale of business line tax adjustment

 

 

 

 

 

 

 

 
61

 

 

 

 

 

 

 

Add: Tax expense from the Tax Cuts and Jobs Act of 2017

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2,623

 

Net income Core

 

$

6,392

 

$

6,706

 

$

5,721

 

$

5,860

 

$

5,271

 

Average common shares outstanding

 

 

7,399,054

 

 

7,399,054

 

 

7,396,533

 

 

7,396,505

 

 

7,396,505

 

Core net income per share

 

$

0.86

 

$

0.91

 

$

0.77

 

$

0.79

 

$

0.71

 

Tangible book value:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total stockholders’ equity

 

$

279,080

 

$

272,971

 

$

269,544

 

$

266,624

 

$

264,976

 

Less: Goodwill

 

 

63,370

 

 

63,370

 

 

63,370

 

 

63,370

 

 

63,370

 

Less: Other intangible assets, net

 

 

2,296

 

 

2,507

 

 

2,727

 

 

2,948

 

 

3,178

 

Total tangible stockholders’ equity

 

$

213,414

 

$

207,094

 

$

203,447

 

$

200,306

 

$

198,428

 

Common shares outstanding

 

 

7,399,054

 

 

7,399,054

 

 

7,399,054

 

 

7,396,505

 

 

7,396,505

 

Tangible book value per share

 

$

28.84

 

$

27.99

 

$

27.50

 

$

27.08

 

$

26.83

 

Core return on average stockholders’ equity:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income GAAP

 

$

6,392

 

$

6,717

 

$

5,957

 

$

5,854

 

$

2,648

 

Adjustments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Less: Gain on sale of business line

 

 

 

 

 

 

 

 

291

 

 

 

 

 

 

 

Add: (gains) losses on investment securities

 

 

 

 

 

(14)

 

 

(8)

 

 

 8

 

 

 

 

Less: (gains) losses on investment securities tax adjustment

 

 

 

 

 

(3)

 

 

(2)

 

 

 2

 

 

 

 

Add: Expenses related to sale of merchant services business

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Add: Gain on sale of business line tax adjustment

 

 

 

 

 

 

 

 

61

 

 

 

 

 

 

 

Add: Tax expense from the Tax Cuts and Jobs Act of 2017

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2,623

 

Net income Core

 

$

6,392

 

$

6,706

 

$

5,721

 

$

5,860

 

$

5,271

 

Average stockholders’ equity

 

$

275,315

 

$

271,761

 

$

268,497

 

$

266,959

 

$

267,926

 

Core return on average stockholders’ equity

 

 

9.21

%  

 

9.79

%  

 

8.55

%  

 

8.90

%  

 

7.81

%

Return on average tangible equity:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income GAAP

 

$

6,392

 

$

6,717

 

$

5,957

 

$

5,854

 

$

2,648

 

Average stockholders’ equity

 

$

275,315

 

$

271,761

 

$

268,497

 

$

266,959

 

$

267,926

 

Less: average intangibles

 

 

65,772

 

 

65,987

 

 

66,208

 

 

66,433

 

 

66,673

 

Average tangible stockholders’ equity

 

$

209,543

 

$

205,774

 

$

202,289

 

$

200,526

 

$

201,253

 

Return on average tangible stockholders’ equity

 

 

12.10

%  

 

12.95

%  

 

11.81

%  

 

11.84

%  

 

5.22

%

Core return on average tangible stockholders’ equity:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income GAAP

 

$

6,392

 

$

6,717

 

$

5,957

 

$

5,854

 

$

2,648

 

Adjustments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Less: Gain on sale of business line

 

 

 

 

 

 

 

 

291

 

 

 

 

 

 

 

Add: (gains) losses on investment securities

 

 

 

 

 

(14)

 

 

(8)

 

 

 8

 

 

 

 

Less: (gains) losses on investment securities tax adjustment

 

 

 

 

 

(3)

 

 

(2)

 

 

 2

 

 

 

 

Add: Expenses related to sale of merchant services business

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Add: Gain on sale of business line tax adjustment

 

 

 

 

 

 

 

 

61

 

 

 

 

 

 

 

Add: Tax expense from the Tax Cuts and Jobs Act of 2017

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2,623

 

Net income Core

 

$

6,392

 

$

6,706

 

$

5,721

 

$

5,860

 

$

5,271

 

Average stockholders’ equity

 

$

275,315

 

$

271,761

 

$

268,497

 

$

266,959

 

$

267,926

 

Less: average intangibles

 

 

65,772

 

 

65,987

 

 

66,208

 

 

66,433

 

 

66,673

 

Average tangible stockholders’ equity

 

$

209,543

 

$

205,774

 

$

202,289

 

$

200,526

 

$

201,253

 

Core return on average tangible stockholders’ equity

 

 

12.10

%  

 

12.93

%  

 

11.34

%  

 

11.85

%  

 

10.39

%

Core return on average assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income GAAP

 

$

6,392

 

$

6,717

 

$

5,957

 

$

5,854

 

$

2,648

 

Adjustments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Less: Gain on sale of business line

 

 

 

 

 

 

 

 

291

 

 

 

 

 

 

 

Add: (gains) losses on investment securities

 

 

 

 

 

(14)

 

 

(8)

 

 

 8

 

 

 

 

Less: (gains) losses on investment securities tax adjustment

 

 

 

 

 

(3)

 

 

(2)

 

 

 2

 

 

 

 

Add: Expenses related to sale of merchant services business

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Add: Gain on sale of business line tax adjustment

 

 

 

 

 

 

 

 

61

 

 

 

 

 

 

 

Add: Tax expense from the Tax Cuts and Jobs Act of 2017

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2,623

 

Net income Core

 

$

6,392

 

$

6,706

 

$

5,721

 

$

5,860

 

$

5,271

 

Average assets

 

$

2,262,447

 

$

2,237,582

 

$

2,218,102

 

$

2,196,581

 

$

2,133,247

 

Core return on average assets

 

 

1.12

%  

 

1.19

%  

 

1.03

%  

 

1.08

%  

 

0.98

%

12

 

Peoples Financial Services Corp.

Reconciliation of Non-GAAP Financial Measures

(In thousands, except share and per share data)

 

 

 

 

 

 

 

 

 

 

    

Dec 31

    

Dec 31

 

Year Ended

 

2018

 

2017

 

Core net income per share:

 

 

 

 

 

 

 

Net income GAAP

 

$

24,920

 

$

18,457

 

Adjustments:

 

 

 

 

 

 

 

Less: Gain on sale of business line

 

 

291

 

 

2,278

 

Less: Gain on investment securities

 

 

14

 

 

 

 

Add: Expenses related to sale of business line

 

 

 

 

 

271

 

Add: Gain on sale of business line tax adjustment

 

 

61

 

 

702

 

Add: Gain on investment securities tax adjustment

 

 

 3

 

 

 

 

Add: Tax expense from the Tax Cuts and Jobs Act of 2017

 

 

 

 

 

2,623

 

Net income Core

 

$

24,679

 

$

19,775

 

Average common shares outstanding

 

 

7,397,797

 

 

7,395,837

 

Core net income per share

 

$

3.34

 

$

2.67

 

 

13