Exhibit 99
Contact Info: | Mary Ellen Fitzpatrick (978) 656-5520 |
| Senior Vice President, Corporate Communications |
Enterprise Bancorp, Inc. announces First Quarter 2009 Net Income of $1.5 million, strong loan and deposit growth, and branch expansion.
LOWELL, Mass (April 23, 2009). Enterprise Bancorp, Inc. (the “Company”) (NASDAQ:EBTC), parent of Enterprise Bank, announced net income of $1.5 million for the three months ended March 31, 2009, compared to $2.0 million for the three months ended March 31, 2008. Diluted earnings per share were $0.19 compared to $0.25 for the same period in 2008.
As previously announced on April 21, 2009, the Company declared a quarterly dividend of $0.095 per share to be paid on June 1, 2009, to shareholders of record as of May 11, 2009, compared to a quarterly dividend of $0.09 per share paid on June 2, 2008.
Loans increased by 3% or $27.8 million since December 31, 2008, a quarterly increase which amounts to an annualized growth rate of 12%, and loan quality remains solid. Total deposits, excluding brokered deposits, increased 6% or $52.4 million since December 31, 2008, representing an annualized growth rate of 24%. On January 12, 2009, Enterprise opened its sixteenth branch in Acton, MA and in March 2009, the Company opened a loan production office in Derry, NH.
Chief Executive Officer Jack Clancy commented, “The current environment continues to provide many opportunities for a strong, well-capitalized, local community commercial bank like Enterprise, as demonstrated by our strong loan and deposit growth, as we continue to provide capital to the local businesses in the communities in which we operate. During the quarter, we celebrated the opening of our Acton branch, as well as the Derry loan production office, which was opened in anticipation of our full-service Derry branch that we expect to have in operation in 2009. We are also expanding our presence in Salem, NH and will be relocating to a larger facility on the same property during the second quarter. This is a testament to the hard work of the Salem team, and our successful expansion in that market. Although these growth initiatives and accompanying expenses have impacted earnings in the short term, such initiatives are an investment in the long-term growth and value of the Company and are reflective of the opportunities in the marketplace for community banks such as Enterprise. Our Enterprise Bank team continues to grow as the leading, most capable and trusted source of commercial loans, cash management, insurance services, and investment management in our region.”
Founder and Chairman of the Board George Duncan stated, “Enterprise Bank continues to apply its consistent and disciplined lending strategy with ongoing investments in our products, customer service, employees and branch network, allowing us to benefit from the market shift towards community banks. Our strong tradition of community involvement continues with our non-profit collaborative series and philanthropic activity. Given the current economic environment, we believe that these efforts are extremely important. We are committed to stimulating economic growth within the communities we serve in the Merrimack Valley and North Central regions of Massachusetts and South Central New Hampshire. In essence, our role as a stable and trusted financial advisor and strong corporate citizen is more important today than ever before.”
Results of Operations
Net income for the March 2009 quarter, when compared to the same quarter in 2008, was impacted primarily by an increase in the provision for loan losses and non-interest expenses, partially offset by an increase in net interest income.
Net interest income for the quarter ended March 31, 2009 amounted to $11.2 million, compared to $9.9 million in the March 2008 quarter, an increase of $1.3 million or 13%. The increase in net interest income over the comparable prior-year period was due primarily to strong loan growth. Average loan balances increased $119.4 million, or 14%, for the quarter ended March 31, 2009 compared to the first quarter in 2008. Quarterly net interest margin was 4.17% for the three months ended March 31, 2009, compared to 4.24% and 4.18% for the quarters ended December 31, 2008 and March 31, 2008, respectively.
The provision for loan losses amounted to $1.1 million for the three months ended March 31, 2009 compared to $317 thousand for the same period in 2008. The increased provision was due to several factors, including 2009 net charge-offs of $386 thousand compared to net recoveries of $24 thousand for the same period last year; an increase in specific reserves on impaired loans; and loan growth during the period. The allowance for loan losses to total loans ratio was 1.64% at March 31, 2009, compared to 1.61% at March 31, 2008. In light of the current economic environment, overall asset quality remains solid, with annualized year-to-date net charge-offs amounting to 0.16% of average total loans in 2009, and non-performing assets to total assets of 0.93% at March 31, 2009 compared to 0.73% and 0.55% at December 31, 2008 and March 31, 2008, respectively.
Non-interest income for the three months ended March 31, 2009 and March 31, 2008 amounted to $2.4 million. Net gains on security sales of $971 thousand, resulting from the sale of securities in the first quarter of 2009, and $758 thousand in other than temporary impairment on certain equity securities amounted to a net of $213 thousand in income, which was an increase of $166 thousand compared to the quarter ended March 31, 2008. Investment advisory income decreased $171 thousand as a result of the decline in the value of assets under management due to market conditions.
Non-interest expense for the three months ended March 31, 2009, amounted to $10.3 million, an increase of 14%, compared to the same quarter last year. The increase in non-interest expense was related primarily to the Company’s strategic growth initiatives resulting in increases in the areas of compensation-related costs, occupancy, and advertising and public relations expenses. In addition, in 2009 the Company’s deposit insurance premiums increased due to changes in the FDIC insurance assessment rates which applied to all insured banks.
Key Financial Highlights
· Total assets were $1.22 billion at March 31, 2009 as compared to $1.18 billion at December 31, 2008, an increase of 3%.
· Total loans increased $27.8 million, or 3%, since December 31, 2008 amounting to $976.4 million at March 31, 2009.
· Total deposits, excluding brokered deposits, were $925 million at March 31, 2009 compared to $872.5 million at December 31, 2008, an increase of 6%. Brokered deposits amounted to $72.6 million and $75.4 million on those respective dates.
· Investment assets under management amounted to $409.8 million at March 31, 2009 compared to $439.7 million at December 31, 2008, a decrease of 7%. The decrease is attributable primarily to the effects of declines in the equity markets on investment account balances, as well as declines in commercial sweep account balances during the period.
· Total assets under management amounted to $1.65 billion at both March 31, 2009 and December 31, 2008.
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, and has reported 78
consecutive profitable quarters. The Company principally is engaged in the business of attracting deposits from the general public and investing in commercial loans and investment securities. Through the bank and its subsidiaries, the Company offers a range of commercial and consumer loan products, deposit and cash management products as well as investment 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 Merrimack Valley and North Central regions of Massachusetts and South Central New Hampshire. Enterprise Bank has sixteen full-service branch offices located in the Massachusetts cities and towns of Lowell, Acton, Andover, Billerica, Chelmsford, Dracut, Fitchburg, Leominster, Methuen, Tewksbury, and Westford and Salem, New Hampshire. The Company also has a loan production office in Derry, NH. The Company has obtained regulatory approvals to establish a new branch in Derry, NH, and anticipates that this office will be open for business in 2009.
The above text 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 the use of the words “believe,” “expect,” “anticipate,” “intend,” “estimate,” “assume,” “will,” “should,” and other expressions that predict or indicate future events or trends and which do not relate to historical matters. 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 and competition. For more information about these factors, please see 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.
ENTERPRISE BANCORP, INC.
Consolidated Statements of Income
Three months ended March 31, 2009 and 2008
(unaudited)
|
| Three Months Ended March 31, |
| ||||
(Dollars in thousands, except per share data) |
| 2009 |
| 2008 |
| ||
|
|
|
|
|
| ||
Interest and dividend income: |
|
|
|
|
| ||
Loans |
| $ | 13,620 |
| $ | 14,562 |
|
Investment securities |
| 1,583 |
| 1,535 |
| ||
Short-term investments |
| 17 |
| 62 |
| ||
Total interest and dividend income |
| 15,220 |
| 16,159 |
| ||
|
|
|
|
|
| ||
Interest expense: |
|
|
|
|
| ||
Deposits |
| 3,639 |
| 5,363 |
| ||
Borrowed funds |
| 95 |
| 586 |
| ||
Junior subordinated debentures |
| 294 |
| 294 |
| ||
Total interest expense |
| 4,028 |
| 6,243 |
| ||
|
|
|
|
|
| ||
Net interest income |
| 11,192 |
| 9,916 |
| ||
|
|
|
|
|
| ||
Provision for loan losses |
| 1,102 |
| 317 |
| ||
|
|
|
|
|
| ||
Net interest income after provision for loan losses |
| 10,090 |
| 9,599 |
| ||
|
|
|
|
|
| ||
Non-interest income: |
|
|
|
|
| ||
Investment advisory fees |
| 649 |
| 820 |
| ||
Deposit service fees |
| 873 |
| 877 |
| ||
Bank-owned life insurance |
| 155 |
| 154 |
| ||
Other than temporary impairment on investment securities |
| (758 | ) | — |
| ||
Net gains on sales of investment securities |
| 971 |
| 47 |
| ||
Gains on sales of loans |
| 122 |
| 31 |
| ||
Other income |
| 361 |
| 468 |
| ||
Total non-interest income |
| 2,373 |
| 2,397 |
| ||
|
|
|
|
|
| ||
Non-interest expense: |
|
|
|
|
| ||
Salaries and employee benefits |
| 5,879 |
| 5,350 |
| ||
Occupancy expenses |
| 1,894 |
| 1,621 |
| ||
Audit, legal and other professional fees |
| 338 |
| 407 |
| ||
Advertising and public relations |
| 546 |
| 367 |
| ||
Deposit insurance premiums |
| 373 |
| 141 |
| ||
Supplies and postage |
| 205 |
| 235 |
| ||
Investment advisory and custodial expenses |
| 103 |
| 114 |
| ||
Other operating expenses |
| 987 |
| 796 |
| ||
Total non-interest expense |
| 10,325 |
| 9,031 |
| ||
|
|
|
|
|
| ||
Income before income taxes |
| 2,138 |
| 2,965 |
| ||
Provision for income taxes |
| 620 |
| 948 |
| ||
|
|
|
|
|
| ||
Net income |
| $ | 1,518 |
| $ | 2,017 |
|
|
|
|
|
|
| ||
Basic earnings per share |
| $ | 0.19 |
| $ | 0.25 |
|
|
|
|
|
|
| ||
Diluted earnings per share |
| $ | 0.19 |
| $ | 0.25 |
|
|
|
|
|
|
| ||
Basic weighted average common shares outstanding |
| 8,059,337 |
| 7,937,988 |
| ||
|
|
|
|
|
| ||
Diluted weighted average common shares outstanding |
| 8,065,636 |
| 7,980,505 |
|
ENTERPRISE BANCORP, INC.
Consolidated Balance Sheets
(unaudited)
|
| March 31, |
| December 31, |
| March 31, |
| |||
(Dollars in thousands) |
| 2009 |
| 2008 |
| 2008 |
| |||
|
|
|
|
|
|
|
| |||
Assets |
|
|
|
|
|
|
| |||
Cash and cash equivalents: |
|
|
|
|
|
|
| |||
Cash and due from banks |
| $ | 30,631 |
| $ | 21,479 |
| $ | 35,386 |
|
Short-term investments |
| 42,231 |
| 3,797 |
| 5,647 |
| |||
Total cash and cash equivalents |
| 72,862 |
| 25,276 |
| 41,033 |
| |||
|
|
|
|
|
|
|
| |||
Investment securities at fair value |
| 118,941 |
| 159,373 |
| 145,140 |
| |||
Loans, less allowance for loan losses of $15,985 at March 31, 2009, $15,269 at December 31, 2008 and $13,886 at March 31, 2008, respectively |
| 960,449 |
| 933,372 |
| 846,776 |
| |||
|
|
|
|
|
|
|
| |||
Premises and equipment |
| 22,457 |
| 21,651 |
| 19,763 |
| |||
Accrued interest receivable |
| 5,232 |
| 5,357 |
| 5,766 |
| |||
Deferred income taxes, net |
| 9,448 |
| 9,349 |
| 7,304 |
| |||
Bank-owned life insurance |
| 13,426 |
| 13,290 |
| 12,876 |
| |||
Prepaid income taxes |
| 507 |
| 1,034 |
| 2,786 |
| |||
Prepaid expenses and other assets |
| 5,908 |
| 5,910 |
| 58 |
| |||
Core deposit intangible, net of amortization |
| 176 |
| 209 |
| 309 |
| |||
Goodwill |
| 5,656 |
| 5,656 |
| 5,656 |
| |||
|
|
|
|
|
|
|
| |||
Total assets |
| $ | 1,215,062 |
| $ | 1,180,477 |
| $ | 1,087,467 |
|
|
|
|
|
|
|
|
| |||
Liabilities and Stockholders’ Equity |
|
|
|
|
|
|
| |||
|
|
|
|
|
|
|
| |||
Liabilities |
|
|
|
|
|
|
| |||
Deposits |
| $ | 997,597 |
| $ | 947,903 |
| $ | 905,587 |
|
Borrowed funds |
| 104,244 |
| 121,250 |
| 72,589 |
| |||
Junior subordinated debentures |
| 10,825 |
| 10,825 |
| 10,825 |
| |||
Accrued expenses and other liabilities |
| 8,919 |
| 7,546 |
| 6,709 |
| |||
Accrued interest payable |
| 1,309 |
| 1,849 |
| 3,176 |
| |||
|
|
|
|
|
|
|
| |||
Total liabilities |
| 1,122,894 |
| 1,089,373 |
| 998,886 |
| |||
|
|
|
|
|
|
|
| |||
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; 8,151,781 and, 8,025,239 and 7,956,187 shares issued and outstanding at March 31, 2009, December 31, 2008 and March 31, 2008, respectively |
| 82 |
| 80 |
| 80 |
| |||
Additional paid-in capital |
| 30,233 |
| 29,698 |
| 28,660 |
| |||
Retained earnings |
| 60,955 |
| 60,200 |
| 58,820 |
| |||
Accumulated other comprehensive income |
| 898 |
| 1,126 |
| 1,021 |
| |||
|
|
|
|
|
|
|
| |||
Total stockholders’ equity |
| 92,168 |
| 91,104 |
| 88,581 |
| |||
|
|
|
|
|
|
|
| |||
Total liabilities and stockholders’ equity |
| $ | 1,215,062 |
| $ | 1,180,477 |
| $ | 1,087,467 |
|
ENTERPRISE BANCORP, INC.
Selected Consolidated Financial Data and Ratios
(unaudited)
|
| At or for the |
| At or for the |
| At or for the |
| |||
|
| three months |
| year |
| three months |
| |||
|
| ended |
| ended |
| ended |
| |||
|
| March 31, |
| December 31, |
| March 31, |
| |||
(Dollars in thousands, except per share data) |
| 2009 |
| 2008 |
| 2008 |
| |||
Balance Sheet Items: |
|
|
|
|
|
|
| |||
Total assets |
| $ | 1,215,062 |
| $ | 1,180,477 |
| $ | 1,087,467 |
|
Loans serviced for others |
| 28,933 |
| 28,341 |
| 24,998 |
| |||
Investment assets under management |
| 409,772 |
| 439,711 |
| 532,687 |
| |||
Total assets under management |
| $ | 1,653,767 |
| $ | 1,648,529 |
| $ | 1,645,152 |
|
|
|
|
|
|
|
|
| |||
Book value per share |
| $ | 11.31 |
| $ | 11.35 |
| $ | 11.13 |
|
Dividends per common share |
| $ | 0.095 |
| $ | 0.360 |
| $ | 0.090 |
|
Total capital to risk weighted assets |
| 10.62 | % | 10.70 | % | 11.24 | % | |||
Tier 1 capital to risk weighted assets |
| 9.36 | % | 9.45 | % | 9.98 | % | |||
Tier 1 capital to average assets |
| 8.10 | % | 8.28 | % | 8.75 | % | |||
Allowance for loan losses to total loans |
| 1.64 | % | 1.61 | % | 1.61 | % | |||
Non-performing assets |
| $ | 11,272 |
| $ | 8,585 |
| $ | 5,971 |
|
Non-performing assets to total assets |
| 0.93 | % | 0.73 | % | 0.55 | % | |||
|
|
|
|
|
|
|
| |||
Income Statement Items (annualized): |
|
|
|
|
|
|
| |||
Return on average assets |
| 0.52 | % | 0.51 | % | 0.77 | % | |||
Return on average stockholders’ equity |
| 6.67 | % | 6.26 | % | 9.25 | % | |||
Net interest margin (tax equivalent) |
| 4.17 | % | 4.23 | % | 4.18 | % |