UNITED STATES |
SECURITIES AND EXCHANGE COMMISSION |
Washington, D.C. 20549 |
WASHINGTON TRUST BANCORP, INC. |
Rhode Island | 001-32991 | 05-0404671 | ||
(State or other jurisdiction of | (Commission File Number) | (IRS Employer Identification No.) | ||
incorporation) |
23 Broad Street | ||||
Westerly, Rhode Island | 02891 | |||
(Address of Principal Executive Offices) | (Zip Code) |
(401) 348-1200 |
(Registrant's telephone number, including area code) |
N/A |
(Former name or address, if changed from last report) |
o | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
o | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
o | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
o | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Emerging growth company o |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition |
period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the |
Exchange Act. o |
(d) | Exhibits. | |||
Exhibit No. | Exhibit | |||
Press release dated January 30, 2018* | ||||
*Filed herewith |
WASHINGTON TRUST BANCORP, INC. | ||||
Date: | January 30, 2018 | By: | /s/ David V. Devault | |
David V. Devault | ||||
Vice Chair, Secretary and Chief Financial Officer |
• | Full-year 2017 net interest income increased by 8% over the prior year and amounted to $120 million, a record level for Washington Trust. |
• | Total loans were $3.4 billion at December 31, 2017, up by 2% in the fourth quarter and up by 4% from a year ago. |
• | Deposits totaled $3.2 billion at December 31, 2017, up by 3% in the fourth quarter and up by 6% from a year ago. |
• | Wealth management assets grew to a record $6.7 billion at December 31, 2017. Full-year 2017 wealth management revenues amounted to an all-time high of $39.3 million, up by 5% from the prior year. |
• | Average interest-earning assets were up by $79 million, reflecting growth in average loan balances. The yield on interest-earning assets for the fourth quarter was 3.70%, up by 3 basis points from the preceding quarter. |
• | Average interest-bearing liabilities increased by $54 million, with growth in average in-market deposits, partially offset by declines in average wholesale funding balances (Federal Home Loan Bank advances and wholesale brokered time deposits). The cost of interest-bearing funds was 0.93%, up by 1 basis point from the preceding quarter. |
• | Wealth management revenues totaled $9.9 million in the fourth quarter of 2017, compared to $10.0 million in the preceding quarter. Full-year 2017 wealth management revenues amounted to $39.3 million, up by $1.8 million, or 5%, from the prior year, due to growth in asset-based revenues. |
• | Mortgage banking revenues totaled $3.1 million in the fourth quarter of 2017, up modestly from the preceding quarter. Residential mortgage loans sold to the secondary market amounted to $145 million in the fourth quarter, compared to $147 million in the preceding quarter. |
• | Loan related derivative income totaled $470 thousand in the fourth quarter of 2017, down by $982 thousand, or 68%, from the preceding quarter, due to a lower volume of commercial borrower loan related derivative transactions. Full-year 2017 loan related derivative income amounted to $3.2 million, essentially unchanged from the full-year amount recognized in 2016. |
• | A reduction to noninterest expenses of $333 thousand ($0.02 per diluted share) was recognized in the fourth quarter resulting from a nontaxable downward adjustment in the fair value of a contingent consideration liability that was initially recorded upon the completion of a 2015 acquisition. |
• | During the fourth quarter, Washington Trust received $325 thousand (after-tax $205 thousand, or $0.01 per diluted share) in settlement of a claim against another bank related to a previously disclosed dispute. This matter was the subject of a $570 thousand expense charge recognized in the third quarter. The settlement was recorded as a reduction to other |
Washington Trust Bancorp, Inc. and Subsidiaries | |||||||||||||||
CONDENSED CONSOLIDATED BALANCE SHEETS | |||||||||||||||
(Unaudited; Dollars in thousands) | |||||||||||||||
Dec 31, 2017 | Sep 30, 2017 | Jun 30, 2017 | Mar 31, 2017 | Dec 31, 2016 | |||||||||||
Assets: | |||||||||||||||
Cash and due from banks | $79,853 | $128,580 | $117,608 | $111,941 | $106,185 | ||||||||||
Short-term investments | 3,070 | 2,600 | 2,324 | 2,039 | 1,612 | ||||||||||
Mortgage loans held for sale | 26,943 | 28,484 | 32,784 | 25,414 | 29,434 | ||||||||||
Securities: | |||||||||||||||
Available for sale, at fair value | 780,954 | 714,355 | 749,486 | 754,720 | 739,912 | ||||||||||
Held to maturity, at amortized cost | 12,541 | 13,241 | 13,942 | 14,721 | 15,633 | ||||||||||
Total securities | 793,495 | 727,596 | 763,428 | 769,441 | 755,545 | ||||||||||
Federal Home Loan Bank stock, at cost | 40,517 | 42,173 | 44,640 | 43,714 | 43,129 | ||||||||||
Loans: | |||||||||||||||
Commercial mortgages | 1,072,487 | 1,085,535 | 1,009,096 | 1,076,648 | 1,074,186 | ||||||||||
Commercial construction & development | 138,008 | 126,257 | 112,177 | 123,841 | 121,371 | ||||||||||
Commercial & industrial | 612,334 | 588,324 | 577,116 | 562,010 | 576,109 | ||||||||||
Residential real estate | 1,227,248 | 1,195,537 | 1,168,105 | 1,131,210 | 1,122,748 | ||||||||||
Consumer | 323,994 | 327,425 | 333,606 | 331,151 | 339,957 | ||||||||||
Total loans | 3,374,071 | 3,323,078 | 3,200,100 | 3,224,860 | 3,234,371 | ||||||||||
Less allowance for loan losses | 26,488 | 27,308 | 26,662 | 26,446 | 26,004 | ||||||||||
Net loans | 3,347,583 | 3,295,770 | 3,173,438 | 3,198,414 | 3,208,367 | ||||||||||
Premises and equipment, net | 28,333 | 28,591 | 28,508 | 28,853 | 29,020 | ||||||||||
Investment in bank-owned life insurance | 73,267 | 72,729 | 72,183 | 71,642 | 71,105 | ||||||||||
Goodwill | 63,909 | 63,909 | 63,909 | 64,059 | 64,059 | ||||||||||
Identifiable intangible assets, net | 9,140 | 9,388 | 9,642 | 9,898 | 10,175 | ||||||||||
Other assets | 63,740 | 69,410 | 67,065 | 63,348 | 62,484 | ||||||||||
Total assets | $4,529,850 | $4,469,230 | $4,375,529 | $4,388,763 | $4,381,115 | ||||||||||
Liabilities: | |||||||||||||||
Deposits: | |||||||||||||||
Demand deposits | $661,138 | $621,273 | $587,813 | $596,974 | $585,960 | ||||||||||
NOW accounts | 466,605 | 448,128 | 448,617 | 454,344 | 427,707 | ||||||||||
Money market accounts | 731,345 | 716,827 | 666,047 | 762,233 | 730,075 | ||||||||||
Savings accounts | 368,524 | 367,912 | 364,002 | 362,281 | 358,397 | ||||||||||
Time deposits | 1,015,095 | 1,002,941 | 954,710 | 939,739 | 961,613 | ||||||||||
Total deposits | 3,242,707 | 3,157,081 | 3,021,189 | 3,115,571 | 3,063,752 | ||||||||||
Federal Home Loan Bank advances | 791,356 | 814,045 | 869,733 | 798,741 | 848,930 | ||||||||||
Junior subordinated debentures | 22,681 | 22,681 | 22,681 | 22,681 | 22,681 | ||||||||||
Other liabilities | 59,822 | 61,195 | 55,884 | 53,985 | 54,948 | ||||||||||
Total liabilities | 4,116,566 | 4,055,002 | 3,969,487 | 3,990,978 | 3,990,311 | ||||||||||
Shareholders’ Equity: | |||||||||||||||
Total shareholders’ equity | 413,284 | 414,228 | 406,042 | 397,785 | 390,804 | ||||||||||
Total liabilities and shareholders’ equity | $4,529,850 | $4,469,230 | $4,375,529 | $4,388,763 | $4,381,115 |
CONSOLIDATED STATEMENTS OF INCOME | ||||||||||||||||||||||
(Unaudited; Dollars in thousands, except per share amounts) | ||||||||||||||||||||||
For the Twelve Months Ended | ||||||||||||||||||||||
For the Three Months Ended | ||||||||||||||||||||||
Dec 31, 2017 | Sep 30, 2017 | Jun 30, 2017 | Mar 31, 2017 | Dec 31, 2016 | Dec 31, 2017 | Dec 31, 2016 | ||||||||||||||||
Interest income: | ||||||||||||||||||||||
Interest and fees on loans | $33,459 | $32,509 | $31,642 | $30,352 | $30,738 | $127,962 | $119,491 | |||||||||||||||
Taxable interest on securities | 4,719 | 4,655 | 4,844 | 4,709 | 3,703 | 18,927 | 11,584 | |||||||||||||||
Nontaxable interest on securities | 24 | 41 | 72 | 112 | 157 | 249 | 982 | |||||||||||||||
Dividends on Federal Home Loan Bank stock | 481 | 467 | 439 | 387 | 362 | 1,774 | 1,091 | |||||||||||||||
Other interest income | 217 | 197 | 156 | 104 | 95 | 674 | 322 | |||||||||||||||
Total interest and dividend income | 38,900 | 37,869 | 37,153 | 35,664 | 35,055 | 149,586 | 133,470 | |||||||||||||||
Interest expense: | ||||||||||||||||||||||
Deposits | 4,136 | 3,835 | 3,591 | 3,502 | 3,445 | 15,064 | 12,504 | |||||||||||||||
Federal Home Loan Bank advances | 3,708 | 3,816 | 3,509 | 3,344 | 2,886 | 14,377 | 9,992 | |||||||||||||||
Junior subordinated debentures | 167 | 159 | 149 | 138 | 135 | 613 | 491 | |||||||||||||||
Other interest expense | — | — | — | 1 | 1 | 1 | 5 | |||||||||||||||
Total interest expense | 8,011 | 7,810 | 7,249 | 6,985 | 6,467 | 30,055 | 22,992 | |||||||||||||||
Net interest income | 30,889 | 30,059 | 29,904 | 28,679 | 28,588 | 119,531 | 110,478 | |||||||||||||||
Provision for loan losses | 200 | 1,300 | 700 | 400 | 2,900 | 2,600 | 5,650 | |||||||||||||||
Net interest income after provision for loan losses | 30,689 | 28,759 | 29,204 | 28,279 | 25,688 | 116,931 | 104,828 | |||||||||||||||
Noninterest income: | ||||||||||||||||||||||
Wealth management revenues | 9,914 | 10,013 | 9,942 | 9,477 | 9,291 | 39,346 | 37,569 | |||||||||||||||
Mortgage banking revenues | 3,097 | 3,036 | 2,919 | 2,340 | 4,541 | 11,392 | 13,183 | |||||||||||||||
Service charges on deposit accounts | 946 | 942 | 901 | 883 | 945 | 3,672 | 3,702 | |||||||||||||||
Card interchange fees | 904 | 894 | 902 | 802 | 858 | 3,502 | 3,385 | |||||||||||||||
Income from bank-owned life insurance | 537 | 546 | 542 | 536 | 549 | 2,161 | 2,659 | |||||||||||||||
Loan related derivative income | 470 | 1,452 | 1,144 | 148 | 912 | 3,214 | 3,243 | |||||||||||||||
Other income | 342 | 400 | 456 | 324 | 224 | 1,522 | 1,388 | |||||||||||||||
Total noninterest income | 16,210 | 17,283 | 16,806 | 14,510 | 17,320 | 64,809 | 65,129 | |||||||||||||||
Noninterest expense: | ||||||||||||||||||||||
Salaries and employee benefits | 17,083 | 17,251 | 17,358 | 16,795 | 16,528 | 68,487 | 67,221 | |||||||||||||||
Net occupancy | 1,859 | 1,928 | 1,767 | 1,967 | 1,775 | 7,521 | 7,151 | |||||||||||||||
Equipment | 1,198 | 1,380 | 1,313 | 1,467 | 1,556 | 5,358 | 6,208 | |||||||||||||||
Outsourced services | 1,960 | 1,793 | 1,710 | 1,457 | 1,311 | 6,920 | 5,222 | |||||||||||||||
Legal, audit and professional fees | 562 | 534 | 582 | 616 | 597 | 2,294 | 2,579 | |||||||||||||||
FDIC deposit insurance costs | 389 | 308 | 469 | 481 | 390 | 1,647 | 1,878 | |||||||||||||||
Advertising and promotion | 466 | 416 | 362 | 237 | 403 | 1,481 | 1,458 | |||||||||||||||
Amortization of intangibles | 248 | 253 | 257 | 277 | 318 | 1,035 | 1,284 | |||||||||||||||
Debt prepayment penalties | — | — | — | — | — | — | 431 | |||||||||||||||
Change in fair value of contingent consideration | (333 | ) | — | — | (310 | ) | — | (643 | ) | (898 | ) | |||||||||||
Other expenses | 2,322 | 2,891 | 2,488 | 2,299 | 2,095 | 10,000 | 8,569 | |||||||||||||||
Total noninterest expense | 25,754 | 26,754 | 26,306 | 25,286 | 24,973 | 104,100 | 101,103 | |||||||||||||||
Income before income taxes | 21,145 | 19,288 | 19,704 | 17,503 | 18,035 | 77,640 | 68,854 | |||||||||||||||
Income tax expense | 13,163 | 6,326 | 6,505 | 5,721 | 5,873 | 31,715 | 22,373 | |||||||||||||||
Net income | $7,982 | $12,962 | $13,199 | $11,782 | $12,162 | $45,925 | $46,481 | |||||||||||||||
Net income available to common shareholders: | ||||||||||||||||||||||
Basic | $7,958 | $12,934 | $13,170 | $11,755 | $12,137 | $45,817 | $46,384 | |||||||||||||||
Diluted | $7,958 | $12,934 | $13,170 | $11,755 | $12,137 | $45,817 | $46,384 | |||||||||||||||
Weighted average common shares outstanding: | ||||||||||||||||||||||
Basic | 17,223 | 17,212 | 17,206 | 17,186 | 17,142 | 17,207 | 17,081 | |||||||||||||||
Diluted | 17,349 | 17,318 | 17,316 | 17,293 | 17,245 | 17,338 | 17,208 | |||||||||||||||
Earnings per common share: | ||||||||||||||||||||||
Basic | $0.46 | $0.75 | $0.77 | $0.68 | $0.71 | $2.66 | $2.72 | |||||||||||||||
Diluted | $0.46 | $0.75 | $0.76 | $0.68 | $0.70 | $2.64 | $2.70 | |||||||||||||||
Cash dividends declared per share | $0.39 | $0.39 | $0.38 | $0.38 | $0.37 | $1.54 | $1.46 |
SELECTED FINANCIAL HIGHLIGHTS | |||||||||||||||
(Unaudited; Dollars in thousands, except per share amounts) | |||||||||||||||
Dec 31, 2017 | Sep 30, 2017 | Jun 30, 2017 | Mar 31, 2017 | Dec 31, 2016 | |||||||||||
Share and Equity Related Data: | |||||||||||||||
Book value per share | $23.99 | $24.06 | $23.59 | $23.14 | $22.76 | ||||||||||
Tangible book value per share - Non-GAAP (1) | $19.75 | $19.81 | $19.32 | $18.83 | $18.44 | ||||||||||
Market value per share | $53.25 | $57.25 | $51.55 | $49.30 | $56.05 | ||||||||||
Shares issued and outstanding at end of period | 17,227 | 17,214 | 17,210 | 17,193 | 17,171 | ||||||||||
Capital Ratios: | |||||||||||||||
Tier 1 risk-based capital | 11.65% (i) | 11.69 | % | 11.92 | % | 11.54 | % | 11.44 | % | ||||||
Total risk-based capital | 12.45% (i) | 12.53 | % | 12.78 | % | 12.38 | % | 12.26 | % | ||||||
Tier 1 leverage ratio | 8.79% (i) | 8.83 | % | 8.78 | % | 8.58 | % | 8.67 | % | ||||||
Common equity tier 1 | 10.99% (i) | 11.02 | % | 11.23 | % | 10.86 | % | 10.75 | % | ||||||
Equity to assets | 9.12 | % | 9.27 | % | 9.28 | % | 9.06 | % | 8.92 | % | |||||
Tangible equity to tangible assets - Non-GAAP (1) | 7.63 | % | 7.76 | % | 7.73 | % | 7.51 | % | 7.35 | % | |||||
(i) - estimated |
For the Twelve Months Ended | |||||||||||||||
For the Three Months Ended | |||||||||||||||
Dec 31, 2017 | Sep 30, 2017 | Jun 30, 2017 | Mar 31, 2017 | Dec 31, 2016 | Dec 31, 2017 | Dec 31, 2016 | |||||||||
Performance Ratios: | |||||||||||||||
Net interest margin (FTE) | 2.95 | % | 2.93 | % | 2.97 | % | 2.87 | % | 2.89 | % | 2.93 | % | 3.02 | % | |
Return on average assets | 0.71 | % | 1.18 | % | 1.21 | % | 1.08 | % | 1.14 | % | 1.04 | % | 1.16 | % | |
Return on average tangible assets - Non-GAAP (1) | 0.73 | % | 1.20 | % | 1.23 | % | 1.10 | % | 1.16 | % | 1.06 | % | 1.19 | % | |
Return on average equity | 7.65 | % | 12.56 | % | 13.06 | % | 11.87 | % | 12.26 | % | 11.26 | % | 11.96 | % | |
Return on average tangible equity - Non-GAAP (1) | 9.27 | % | 15.27 | % | 15.98 | % | 14.59 | % | 15.09 | % | 13.73 | % | 14.82 | % |
(1) | See the section labeled “SUPPLEMENTAL INFORMATION - Calculation of Non-GAAP Financial Measures” at the end of this document. |
SELECTED FINANCIAL HIGHLIGHTS | ||||||||||||||||||||||
(Unaudited; Dollars in thousands) | ||||||||||||||||||||||
For the Twelve Months Ended | ||||||||||||||||||||||
For the Three Months Ended | ||||||||||||||||||||||
Dec 31, 2017 | Sep 30, 2017 | Jun 30, 2017 | Mar 31, 2017 | Dec 31, 2016 | Dec 31, 2017 | Dec 31, 2016 | ||||||||||||||||
Wealth Management Results | ||||||||||||||||||||||
Wealth Management Revenues: | ||||||||||||||||||||||
Asset-based revenues | 9,686 | 9,791 | 9,401 | 9,247 | 9,054 | 38,125 | 36,139 | |||||||||||||||
Transaction-based revenues | 228 | 222 | 541 | 230 | 237 | 1,221 | 1,430 | |||||||||||||||
Total wealth management revenues | $9,914 | $10,013 | $9,942 | $9,477 | $9,291 | $39,346 | $37,569 | |||||||||||||||
Assets Under Administration: | ||||||||||||||||||||||
Balance at beginning of period | $6,587,899 | $6,403,501 | $6,243,301 | $6,063,293 | $6,056,859 | $6,063,293 | $5,844,636 | |||||||||||||||
Net investment appreciation (depreciation) & income | 163,681 | 270,549 | 162,924 | 220,423 | (8,506 | ) | 817,577 | 277,848 | ||||||||||||||
Net client asset flows | (36,943 | ) | (86,151 | ) | (2,724 | ) | (40,415 | ) | 14,940 | (166,233 | ) | (59,191 | ) | |||||||||
Balance at end of period | $6,714,637 | $6,587,899 | $6,403,501 | $6,243,301 | $6,063,293 | $6,714,637 | $6,063,293 | |||||||||||||||
Mortgage Banking Results | ||||||||||||||||||||||
Mortgage Banking Revenues: | ||||||||||||||||||||||
Gains & commissions on loan sales, net | $2,987 | $2,952 | $2,784 | $2,268 | $4,455 | $10,991 | $13,137 | |||||||||||||||
Residential mortgage servicing fee income, net | 110 | 84 | 135 | 72 | 86 | 401 | 46 | |||||||||||||||
Total mortgage banking revenues | $3,097 | $3,036 | $2,919 | $2,340 | $4,541 | $11,392 | $13,183 | |||||||||||||||
Residential Mortgage Loan Originations: | ||||||||||||||||||||||
Originations for retention in portfolio | $75,595 | $90,378 | $94,794 | $57,907 | $72,533 | $318,674 | $264,466 | |||||||||||||||
Originations for sale to secondary market (1) | 143,834 | 143,112 | 144,491 | 102,441 | 185,626 | 533,878 | 600,800 | |||||||||||||||
Total mortgage loan originations | $219,429 | $233,490 | $239,285 | $160,348 | $258,159 | $852,552 | $865,266 | |||||||||||||||
Residential Mortgage Loans Sold: | ||||||||||||||||||||||
Sold with servicing rights retained | $39,769 | $37,823 | $29,199 | $22,567 | $48,545 | $129,358 | $165,414 | |||||||||||||||
Sold with servicing rights released (1) | 105,416 | 109,508 | 108,245 | 84,345 | 151,506 | 407,514 | 443,824 | |||||||||||||||
Total mortgage loans sold | $145,185 | $147,331 | $137,444 | $106,912 | $200,051 | $536,872 | $609,238 |
(1) | Also includes loans originated in a broker capacity. |
END OF PERIOD LOAN AND DEPOSIT COMPOSITION | |||||||||||||||
(Unaudited; Dollars in thousands) | |||||||||||||||
Dec 31, 2017 | Sep 30, 2017 | Jun 30, 2017 | Mar 31, 2017 | Dec 31, 2016 | |||||||||||
Commercial: | |||||||||||||||
Mortgages | $1,072,487 | $1,085,535 | $1,009,096 | $1,076,648 | $1,074,186 | ||||||||||
Construction & development | 138,008 | 126,257 | 112,177 | 123,841 | 121,371 | ||||||||||
Commercial & industrial | 612,334 | 588,324 | 577,116 | 562,010 | 576,109 | ||||||||||
Total commercial | 1,822,829 | 1,800,116 | 1,698,389 | 1,762,499 | 1,771,666 | ||||||||||
Residential Real Estate: | |||||||||||||||
Mortgages | 1,206,458 | 1,171,161 | 1,143,416 | 1,100,435 | 1,094,824 | ||||||||||
Homeowner construction | 20,790 | 24,376 | 24,689 | 30,775 | 27,924 | ||||||||||
Total residential real estate | 1,227,248 | 1,195,537 | 1,168,105 | 1,131,210 | 1,122,748 | ||||||||||
Consumer: | |||||||||||||||
Home equity lines | 258,114 | 259,880 | 263,934 | 258,695 | 264,200 | ||||||||||
Home equity loans | 34,353 | 34,777 | 35,173 | 36,050 | 37,272 | ||||||||||
Other | 31,527 | 32,768 | 34,499 | 36,406 | 38,485 | ||||||||||
Total consumer | 323,994 | 327,425 | 333,606 | 331,151 | 339,957 | ||||||||||
Total loans | $3,374,071 | $3,323,078 | $3,200,100 | $3,224,860 | $3,234,371 |
December 31, 2017 | December 31, 2016 | ||||||||||
Balance | % of Total | Balance | % of Total | ||||||||
Commercial Real Estate Loans by Property Location: | |||||||||||
Rhode Island, Connecticut, Massachusetts | $1,131,077 | 93.5 | % | $1,105,539 | 92.5 | % | |||||
New York, New Jersey, Pennsylvania | 66,857 | 5.5 | % | 77,038 | 6.4 | % | |||||
New Hampshire | 12,561 | 1.0 | % | 12,980 | 1.1 | % | |||||
Total commercial real estate loans (1) | $1,210,495 | 100.0 | % | $1,195,557 | 100.0 | % | |||||
Residential Mortgages by Property Location: | |||||||||||
Rhode Island, Connecticut, Massachusetts | $1,210,895 | 98.6 | % | $1,106,366 | 98.6 | % | |||||
New Hampshire, Vermont, Maine | 12,061 | 1.0 | % | 11,445 | 1.0 | % | |||||
New York, Virginia, New Jersey, Maryland, Pennsylvania | 2,168 | 0.2 | % | 2,648 | 0.2 | % | |||||
Ohio | 862 | 0.1 | % | 997 | 0.1 | % | |||||
Other | 1,262 | 0.1 | % | 1,292 | 0.1 | % | |||||
Total residential mortgages | $1,227,248 | 100.0 | % | $1,122,748 | 100.0 | % |
(1) | Commercial real estate loans consist of commercial mortgages and construction and development loans. Commercial mortgages are loans secured by income producing property. |
Dec 31, 2017 | Sep 30, 2017 | Jun 30, 2017 | Mar 31, 2017 | Dec 31, 2016 | |||||||||||
Deposits: | |||||||||||||||
Non-interest bearing demand deposits | $578,410 | $575,866 | $533,147 | $534,792 | $521,165 | ||||||||||
Interest-bearing demand deposits | 82,728 | 45,407 | 54,666 | 62,182 | 64,795 | ||||||||||
NOW accounts | 466,605 | 448,128 | 448,617 | 454,344 | 427,707 | ||||||||||
Money market accounts | 731,345 | 716,827 | 666,047 | 762,233 | 730,075 | ||||||||||
Savings accounts | 368,524 | 367,912 | 364,002 | 362,281 | 358,397 | ||||||||||
Time deposits (in-market) | 617,368 | 587,166 | 553,783 | 557,312 | 549,376 | ||||||||||
Wholesale brokered time deposits | 397,727 | 415,775 | 400,927 | 382,427 | 412,237 | ||||||||||
Total deposits | $3,242,707 | $3,157,081 | $3,021,189 | $3,115,571 | $3,063,752 |
CREDIT & ASSET QUALITY DATA | |||||||||||||||
(Unaudited; Dollars in thousands) | |||||||||||||||
Dec 31, 2017 | Sep 30, 2017 | Jun 30, 2017 | Mar 31, 2017 | Dec 31, 2016 | |||||||||||
Asset Quality Ratios: | |||||||||||||||
Nonperforming assets to total assets | 0.34 | % | 0.44 | % | 0.49 | % | 0.54 | % | 0.53 | % | |||||
Nonaccrual loans to total loans | 0.45 | % | 0.56 | % | 0.63 | % | 0.69 | % | 0.68 | % | |||||
Total past due loans to total loans | 0.59 | % | 0.49 | % | 0.66 | % | 0.65 | % | 0.76 | % | |||||
Allowance for loan losses to nonaccrual loans | 174.14 | % | 147.52 | % | 132.00 | % | 119.52 | % | 117.89 | % | |||||
Allowance for loan losses to total loans | 0.79 | % | 0.82 | % | 0.83 | % | 0.82 | % | 0.80 | % | |||||
Nonperforming Assets: | |||||||||||||||
Commercial mortgages | $4,954 | $5,887 | $6,422 | $7,809 | $7,811 | ||||||||||
Commercial & industrial | 283 | 429 | 1,232 | 1,129 | 1,337 | ||||||||||
Residential real estate mortgages | 9,414 | 11,699 | 11,815 | 12,253 | 11,736 | ||||||||||
Consumer | 560 | 496 | 729 | 936 | 1,174 | ||||||||||
Total nonaccrual loans | 15,211 | 18,511 | 20,198 | 22,127 | 22,058 | ||||||||||
Other real estate owned | 131 | 1,038 | 1,342 | 1,410 | 1,075 | ||||||||||
Total nonperforming assets | $15,342 | $19,549 | $21,540 | $23,537 | $23,133 | ||||||||||
Past Due Loans (30 days or more past due): | |||||||||||||||
Commercial mortgages | $4,960 | $5,887 | $6,422 | $7,806 | $8,708 | ||||||||||
Commercial & industrial | 4,076 | 455 | 4,009 | 1,046 | 1,154 | ||||||||||
Residential real estate mortgages | 7,855 | 7,802 | 8,857 | 10,533 | 12,226 | ||||||||||
Consumer loans | 3,184 | 2,303 | 1,832 | 1,547 | 2,334 | ||||||||||
Total past due loans | $20,075 | $16,447 | $21,120 | $20,932 | $24,422 | ||||||||||
Accruing loans 90 days or more past due | $— | $— | $— | $— | $— | ||||||||||
Nonaccrual loans included in past due loans | $11,788 | $13,216 | $14,490 | $18,081 | $18,602 |
For the Twelve Months Ended | ||||||||||||||||||||||
For the Three Months Ended | ||||||||||||||||||||||
Dec 31, 2017 | Sep 30, 2017 | Jun 30, 2017 | Mar 31, 2017 | Dec 31, 2016 | Dec 31, 2017 | Dec 31, 2016 | ||||||||||||||||
Nonaccrual Loan Activity: | ||||||||||||||||||||||
Balance at beginning of period | $18,511 | $20,198 | $22,127 | $22,058 | $23,950 | $22,058 | $21,047 | |||||||||||||||
Additions to nonaccrual status | 462 | 1,969 | 1,946 | 2,138 | 2,105 | 6,515 | 15,278 | |||||||||||||||
Loans returned to accruing status | (1,316 | ) | (1,411 | ) | (778 | ) | (547 | ) | (718 | ) | (4,052 | ) | (1,516 | ) | ||||||||
Loans charged-off | (1,047 | ) | (694 | ) | (642 | ) | (79 | ) | (2,622 | ) | (2,462 | ) | (7,012 | ) | ||||||||
Loans transferred to other real estate owned | — | — | (98 | ) | (478 | ) | (30 | ) | (576 | ) | (1,075 | ) | ||||||||||
Payments, payoffs and other changes | (1,399 | ) | (1,551 | ) | (2,357 | ) | (965 | ) | (627 | ) | (6,272 | ) | (4,664 | ) | ||||||||
Balance at end of period | $15,211 | $18,511 | $20,198 | $22,127 | $22,058 | $15,211 | $22,058 | |||||||||||||||
Allowance for Loan Losses: | ||||||||||||||||||||||
Balance at beginning of period | $27,308 | $26,662 | $26,446 | $26,004 | $25,649 | $26,004 | $27,069 | |||||||||||||||
Provision charged to earnings | 200 | 1,300 | 700 | 400 | 2,900 | 2,600 | 5,650 | |||||||||||||||
Charge-offs | (1,047 | ) | (694 | ) | (642 | ) | (79 | ) | (2,622 | ) | (2,462 | ) | (7,012 | ) | ||||||||
Recoveries | 27 | 40 | 158 | 121 | 77 | 346 | 297 | |||||||||||||||
Balance at end of period | $26,488 | $27,308 | $26,662 | $26,446 | $26,004 | $26,488 | $26,004 | |||||||||||||||
Net Loan Charge-Offs (Recoveries): | ||||||||||||||||||||||
Commercial mortgages | $932 | $535 | $318 | $— | $2,510 | $1,785 | $5,760 | |||||||||||||||
Commercial & industrial | 43 | 114 | 115 | (105 | ) | (20 | ) | 167 | 603 | |||||||||||||
Residential real estate mortgages | 32 | (1 | ) | 8 | (4 | ) | 6 | 35 | 189 | |||||||||||||
Consumer | 13 | 6 | 43 | 67 | 49 | 129 | 163 | |||||||||||||||
Total | $1,020 | $654 | $484 | ($42 | ) | $2,545 | $2,116 | $6,715 | ||||||||||||||
Net charge-offs to average loans (annualized) | 0.12 | % | 0.08 | % | 0.06 | % | (0.01 | %) | 0.31 | % | 0.06 | % | 0.21 | % |
CONSOLIDATED AVERAGE BALANCE SHEETS (FTE Basis) | |||||||||||||||||||||||
(Unaudited; Dollars in thousands) | |||||||||||||||||||||||
For the Three Months Ended | December 31, 2017 | September 30, 2017 | December 31, 2016 | ||||||||||||||||||||
Average Balance | Interest | Yield/ Rate | Average Balance | Interest | Yield/ Rate | Average Balance | Interest | Yield/ Rate | |||||||||||||||
Assets: | |||||||||||||||||||||||
Commercial mortgages | $1,076,786 | $10,356 | 3.82 | $1,027,517 | $9,909 | 3.83 | $1,086,772 | $9,520 | 3.48 | ||||||||||||||
Construction & development | 142,584 | 1,487 | 4.14 | 133,190 | 1,326 | 3.95 | 110,342 | 927 | 3.34 | ||||||||||||||
Commercial & industrial | 598,790 | 6,897 | 4.57 | 590,915 | 6,684 | 4.49 | 575,983 | 6,927 | 4.78 | ||||||||||||||
Total commercial loans | 1,818,160 | $18,740 | 4.09 | 1,751,622 | $17,919 | 4.06 | 1,773,097 | $17,374 | 3.90 | ||||||||||||||
Residential real estate loans, including loans held for sale | 1,226,369 | 11,727 | 3.79 | 1,210,686 | 11,541 | 3.78 | 1,140,492 | 10,652 | 3.72 | ||||||||||||||
Consumer loans | 326,445 | 3,556 | 4.32 | 329,689 | 3,604 | 4.34 | 341,528 | 3,284 | 3.83 | ||||||||||||||
Total loans | 3,370,974 | 34,023 | 4.00 | 3,291,997 | 33,064 | 3.98 | 3,255,117 | 31,310 | 3.83 | ||||||||||||||
Cash, federal funds sold and short-term investments | 62,040 | 217 | 1.39 | 61,390 | 197 | 1.27 | 77,092 | 95 | 0.49 | ||||||||||||||
FHLBB stock | 41,003 | 481 | 4.65 | 44,057 | 467 | 4.21 | 39,212 | 362 | 3.67 | ||||||||||||||
Taxable debt securities | 756,322 | 4,719 | 2.48 | 751,735 | 4,655 | 2.46 | 636,277 | 3,703 | 2.32 | ||||||||||||||
Nontaxable debt securities | 2,625 | 38 | 5.74 | 4,287 | 65 | 6.02 | 16,003 | 244 | 6.07 | ||||||||||||||
Total securities | 758,947 | 4,757 | 2.49 | 756,022 | 4,720 | 2.48 | 652,280 | 3,947 | 2.41 | ||||||||||||||
Total interest-earning assets | 4,232,964 | 39,478 | 3.70 | 4,153,466 | 38,448 | 3.67 | 4,023,701 | 35,714 | 3.53 | ||||||||||||||
Noninterest-earning assets | 240,376 | 248,070 | 249,182 | ||||||||||||||||||||
Total assets | $4,473,340 | $4,401,536 | $4,272,883 | ||||||||||||||||||||
Liabilities and Shareholders' Equity: | |||||||||||||||||||||||
Interest-bearing demand deposits | $64,344 | $25 | 0.15 | $46,352 | $30 | 0.26 | $46,668 | $16 | 0.14 | ||||||||||||||
NOW accounts | 448,677 | 42 | 0.04 | 442,166 | 68 | 0.06 | 408,788 | 51 | 0.05 | ||||||||||||||
Money market accounts | 743,966 | 807 | 0.43 | 680,755 | 642 | 0.37 | 761,582 | 574 | 0.30 | ||||||||||||||
Savings accounts | 371,236 | 63 | 0.07 | 366,177 | 56 | 0.06 | 356,837 | 51 | 0.06 | ||||||||||||||
Time deposits (in-market) | 606,732 | 1,765 | 1.15 | 565,402 | 1,566 | 1.10 | 552,474 | 1,419 | 1.02 | ||||||||||||||
Wholesale brokered time deposits | 376,709 | 1,434 | 1.51 | 404,953 | 1,473 | 1.44 | 382,798 | 1,334 | 1.39 | ||||||||||||||
FHLBB advances | 785,169 | 3,708 | 1.87 | 837,300 | 3,816 | 1.81 | 732,269 | 2,886 | 1.57 | ||||||||||||||
Junior subordinated debentures | 22,681 | 167 | 2.92 | 22,681 | 159 | 2.78 | 22,681 | 135 | 2.37 | ||||||||||||||
Other | — | — | — | 1 | — | — | 40 | 1 | 9.95 | ||||||||||||||
Total interest-bearing liabilities | 3,419,514 | 8,011 | 0.93 | 3,365,787 | 7,810 | 0.92 | 3,264,137 | 6,467 | 0.79 | ||||||||||||||
Demand deposits | 582,714 | 567,737 | 548,595 | ||||||||||||||||||||
Other liabilities | 53,544 | 55,150 | 63,410 | ||||||||||||||||||||
Shareholders' equity | 417,568 | 412,862 | 396,741 | ||||||||||||||||||||
Total liabilities and shareholders' equity | $4,473,340 | $4,401,536 | $4,272,883 | ||||||||||||||||||||
Net interest income (FTE) | $31,467 | $30,638 | $29,247 | ||||||||||||||||||||
Interest rate spread | 2.77 | 2.75 | 2.74 | ||||||||||||||||||||
Net interest margin | 2.95 | 2.93 | 2.89 |
For the Three Months Ended | Dec 31, 2017 | Sep 30, 2017 | Dec 31, 2016 | ||||||
Commercial loans | $564 | $555 | $572 | ||||||
Nontaxable debt securities | 14 | 24 | 87 | ||||||
Total | $578 | $579 | $659 |
CONSOLIDATED AVERAGE BALANCE SHEETS (FTE Basis) | |||||||||||||||
(Unaudited; Dollars in thousands) | |||||||||||||||
For the Twelve Months Ended | December 31, 2017 | December 31, 2016 | |||||||||||||
Average Balance | Interest | Yield/ Rate | Average Balance | Interest | Yield/ Rate | ||||||||||
Assets: | |||||||||||||||
Commercial mortgages | $1,055,127 | $39,529 | 3.75 | $1,030,289 | $36,089 | 3.50 | |||||||||
Construction & development | 132,504 | 5,137 | 3.88 | 110,770 | 3,732 | 3.37 | |||||||||
Commercial & industrial | 584,647 | 26,347 | 4.51 | 584,307 | 27,398 | 4.69 | |||||||||
Total commercial loans | 1,772,278 | 71,013 | 4.01 | 1,725,366 | 67,219 | 3.90 | |||||||||
Residential real estate loans, including loans held for sale | 1,188,369 | 45,224 | 3.81 | 1,069,402 | 41,173 | 3.85 | |||||||||
Consumer loans | 330,783 | 13,947 | 4.22 | 342,431 | 13,328 | 3.89 | |||||||||
Total loans | 3,291,430 | 130,184 | 3.96 | 3,137,199 | 121,720 | 3.88 | |||||||||
Cash, federal funds sold and short-term investments | 60,033 | 674 | 1.12 | 75,997 | 322 | 0.42 | |||||||||
FHLBB stock | 43,256 | 1,774 | 4.10 | 33,643 | 1,091 | 3.24 | |||||||||
Taxable debt securities | 759,304 | 18,927 | 2.49 | 472,892 | 11,584 | 2.45 | |||||||||
Nontaxable debt securities | 6,347 | 384 | 6.05 | 24,939 | 1,520 | 6.09 | |||||||||
Total securities | 765,651 | 19,311 | 2.52 | 497,831 | 13,104 | 2.63 | |||||||||
Total interest-earning assets | 4,160,370 | 151,943 | 3.65 | 3,744,670 | 136,237 | 3.64 | |||||||||
Noninterest-earning assets | 238,636 | 249,808 | |||||||||||||
Total assets | $4,399,006 | $3,994,478 | |||||||||||||
Liabilities and Shareholders' Equity: | |||||||||||||||
Interest-bearing demand deposits | $55,534 | $62 | 0.11 | $45,038 | $49 | 0.11 | |||||||||
NOW accounts | 437,277 | 218 | 0.05 | 400,209 | 212 | 0.05 | |||||||||
Money market accounts | 722,590 | 2,688 | 0.37 | 741,925 | 2,035 | 0.27 | |||||||||
Savings accounts | 364,255 | 221 | 0.06 | 343,943 | 200 | 0.06 | |||||||||
Time deposits (in-market) | 571,733 | 6,208 | 1.09 | 546,460 | 5,486 | 1.00 | |||||||||
Wholesale brokered time deposits | 392,894 | 5,667 | 1.44 | 323,390 | 4,522 | 1.40 | |||||||||
FHLBB advances | 817,784 | 14,377 | 1.76 | 616,404 | 9,992 | 1.62 | |||||||||
Junior subordinated debentures | 22,681 | 613 | 2.70 | 22,681 | 491 | 2.16 | |||||||||
Other | 10 | 1 | 10.00 | 60 | 5 | 8.33 | |||||||||
Total interest-bearing liabilities | 3,384,758 | 30,055 | 0.89 | 3,040,110 | 22,992 | 0.76 | |||||||||
Demand deposits | 555,548 | 503,806 | |||||||||||||
Other liabilities | 50,684 | 62,021 | |||||||||||||
Shareholders' equity | 408,016 | 388,541 | |||||||||||||
Total liabilities and shareholders' equity | $4,399,006 | $3,994,478 | |||||||||||||
Net interest income (FTE) | $121,888 | $113,245 | |||||||||||||
Interest rate spread | 2.76 | 2.88 | |||||||||||||
Net interest margin | 2.93 | 3.02 |
For the Twelve Months Ended | Dec 31, 2017 | Dec 31, 2016 | ||||
Commercial loans | $2,222 | $2,229 | ||||
Nontaxable debt securities | 135 | 538 | ||||
Total | $2,357 | $2,767 |
SUPPLEMENTAL INFORMATION - Calculation of Non-GAAP Financial Measures | |||||||||||||||
(Unaudited; Dollars in thousands, except per share amounts) | |||||||||||||||
Dec 31, 2017 | Sep 30, 2017 | Jun 30, 2017 | Mar 31, 2017 | Dec 31, 2016 | |||||||||||
Tangible Book Value per Share: | |||||||||||||||
Total shareholders' equity, as reported | $413,284 | $414,228 | $406,042 | $397,785 | $390,804 | ||||||||||
Less: | |||||||||||||||
Goodwill | 63,909 | 63,909 | 63,909 | 64,059 | 64,059 | ||||||||||
Identifiable intangible assets, net | 9,140 | 9,388 | 9,642 | 9,898 | 10,175 | ||||||||||
Total tangible shareholders' equity | $340,235 | $340,931 | $332,491 | $323,828 | $316,570 | ||||||||||
Shares outstanding, as reported | 17,227 | 17,214 | 17,210 | 17,193 | 17,171 | ||||||||||
Book value per share - GAAP | $23.99 | $24.06 | $23.59 | $23.14 | $22.76 | ||||||||||
Tangible book value per share - Non-GAAP | $19.75 | $19.81 | $19.32 | $18.83 | $18.44 | ||||||||||
Tangible Equity to Tangible Assets: | |||||||||||||||
Total tangible shareholders' equity | $340,235 | $340,931 | $332,491 | $323,828 | $316,570 | ||||||||||
Total assets, as reported | $4,529,850 | $4,469,230 | $4,375,529 | $4,388,763 | $4,381,115 | ||||||||||
Less: | |||||||||||||||
Goodwill | 63,909 | 63,909 | 63,909 | 64,059 | 64,059 | ||||||||||
Identifiable intangible assets, net | 9,140 | 9,388 | 9,642 | 9,898 | 10,175 | ||||||||||
Total tangible assets | $4,456,801 | $4,395,933 | $4,301,978 | $4,314,806 | $4,306,881 | ||||||||||
Equity to assets - GAAP | 9.12 | % | 9.27 | % | 9.28 | % | 9.06 | % | 8.92 | % | |||||
Tangible equity to tangible assets - Non-GAAP | 7.63 | % | 7.76 | % | 7.73 | % | 7.51 | % | 7.35 | % |
For the Three Months Ended | For the Twelve Months Ended | |||||||||||||||||||||
Dec 31, 2017 | Sep 30, 2017 | Jun 30, 2017 | Mar 31, 2017 | Dec 31, 2016 | Dec 31, 2017 | Dec 31, 2016 | ||||||||||||||||
Return on Average Tangible Assets: | ||||||||||||||||||||||
Net income, as reported | $7,982 | $12,962 | $13,199 | $11,782 | $12,162 | $45,925 | $46,481 | |||||||||||||||
Total average assets, as reported | $4,473,340 | $4,401,536 | $4,354,464 | $4,365,471 | $4,272,883 | $4,399,006 | $3,994,478 | |||||||||||||||
Less average balances of: | ||||||||||||||||||||||
Goodwill | 63,909 | 63,909 | 64,058 | 64,059 | 64,059 | 63,983 | 64,059 | |||||||||||||||
Identifiable intangible assets, net | 9,261 | 9,511 | 9,767 | 10,027 | 10,330 | 9,639 | 10,810 | |||||||||||||||
Total average tangible assets | $4,400,170 | $4,328,116 | $4,280,639 | $4,291,385 | $4,198,494 | $4,325,384 | $3,919,609 | |||||||||||||||
Return on average assets - GAAP | 0.71 | % | 1.18 | % | 1.21 | % | 1.08 | % | 1.14 | % | 1.04 | % | 1.16 | % | ||||||||
Return on average tangible assets - Non-GAAP | 0.73 | % | 1.20 | % | 1.23 | % | 1.10 | % | 1.16 | % | 1.06 | % | 1.19 | % | ||||||||
Return on Average Tangible Equity: | ||||||||||||||||||||||
Net income, as reported | $7,982 | $12,962 | $13,199 | $11,782 | $12,162 | $45,925 | $46,481 | |||||||||||||||
Total average equity, as reported | $417,568 | $412,862 | $404,238 | $397,117 | $396,741 | $408,016 | $388,541 | |||||||||||||||
Less average balances of: | ||||||||||||||||||||||
Goodwill | 63,909 | 63,909 | 64,058 | 64,059 | 64,059 | 63,983 | 64,059 | |||||||||||||||
Identifiable intangible assets, net | 9,261 | 9,511 | 9,767 | 10,027 | 10,330 | 9,639 | 10,810 | |||||||||||||||
Total average tangible equity | $344,398 | $339,442 | $330,413 | $323,031 | $322,352 | $334,394 | $313,672 | |||||||||||||||
Return on average equity - GAAP | 7.65 | % | 12.56 | % | 13.06 | % | 11.87 | % | 12.26 | % | 11.26 | % | 11.96 | % | ||||||||
Return on average tangible equity - Non-GAAP | 9.27 | % | 15.27 | % | 15.98 | % | 14.59 | % | 15.09 | % | 13.73 | % | 14.82 | % |
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