Exhibit 99.1
Brookline Bancorp Announces 2010 Third Quarter Earnings and Dividend Declaration
BROOKLINE, Mass.--(BUSINESS WIRE)--October 20, 2010--Brookline Bancorp, Inc. (the “Company”) (NASDAQ: BRKL) announced today its earnings for the 2010 third quarter and approval by the Board of Directors of a regular quarterly dividend of $0.085 per share payable on November 15, 2010 to stockholders of record on October 29, 2010.
The Company earned $7,038,000, or $0.12 per share on a basic and diluted basis, for the quarter ended September 30, 2010 compared to $5,242,000, or $0.09 per share on a basic and diluted basis, for the quarter ended September 30, 2009. Net income for the nine months ended September 30, 2010 was $20,474,000, or $0.35 per share on a basic and diluted basis, compared to $13,364,000, or $0.23 per share on a basic and diluted basis, for the nine months ended September 30, 2009. Operating highlights included:
- Improvement in performance ratios both on third quarter and nine month comparisons
- annualized return on average stockholders’ equity (third quarter – 5.69% in 2010 and 4.31% in 2009; nine months – 5.55% in 2010 and 3.66% in 2009)
- annualized return on average assets (third quarter – 1.06% in 2010 and 0.79% in 2009; nine months – 1.03% in 2010 and 0.68% in 2009)
- An increase in net interest income of $2,493,000 (11.4%) in the 2010 third quarter compared to the 2009 third quarter and $8,443,000 (13.5%) in the 2010 nine month period compared to the 2009 nine month period. The 2009 nine month period included $1,614,000 of interest income from the payoff of a loan on which there was unaccreted interest.
- Continued improvement in net interest margin – 3.76% in the 2010 third quarter compared to 3.67% in the 2010 second quarter and 3.39% in the 2009 third quarter
- Lower provisions for credit losses - $551,000 in the 2010 third quarter compared to $2,473,000 in the 2009 third quarter and $2,479,000 in the 2010 nine month period compared to $7,150,000 in the 2009 nine month period. The reductions resulted from lower loan charge-offs and slower growth in loans.
- Total loans (excluding deferred loan origination costs) - $16.7 million increase in the 2010 third quarter and a $24.8 million increase in the 2010 nine month period
- Non-performing assets - $6.0 million (0.23% of total assets) at September 30, 2010 compared to $6.0 million (0.23%) at June 30, 2010 and $7.7 million (0.29%) at December 31, 2009. Restructured loans on accrual were $7.4 million, $7.0 million and $3.9 million at those respective dates.
- Allowance for loan losses - $30.4 million (1.39% of total loans outstanding) at September 30, 2010 compared to $30.6 million (1.41%) at June 30, 2010 and $31.1 million (1.44%) at December 31, 2009
- Deposit growth - $57.6 million (3.4%) in the 2010 third quarter and $126.6 million (7.7%) in the 2010 nine month period. (Transaction deposit accounts increased $170.6 million, or 21.3%, while certificates of deposit declined $44.0 million, or 5.3%).
- To lower funding costs and reduce interest rate risk, the Company prepaid borrowings from the Federal Home Loan Bank of Boston (“FHLB”) with high interest rates and re-borrowed funds from the FHLB at lower interest rates and with longer periods to maturity. Penalties from prepayments amounted to $555,000 in the 2010 third quarter compared to $533,000 in the 2009 third quarter and $1,468,000 in the 2010 nine month period compared to $1,115,000 in the 2009 nine month period.
- Gains from sales of securities were $594,000 in the 2009 third quarter (none in the 2010 third quarter), $834,000 in the 2010 nine month period and $940,000 in the 2009 nine month period. Impairment loss on securities, net of non-credit impairment loss, was $49,000 in the 2010 nine month period compared to $726,000 in the 2009 nine month period.
The quarterly and nine month period increases in net interest income were due primarily to a higher portion of interest-earning assets being funded by lower cost deposits and a more rapid decline in rates paid on interest-bearing liabilities than in the yield on interest-earning assets. Including non-interest bearing checking accounts, the average balance of deposits (excluding brokered deposits) in the 2010 nine month period was $233.1 million (16.1%) higher than in the 2009 nine month period and the average rate paid on deposits (excluding brokered deposits) declined to 1.30% from 2.21% in those respective periods. The average rate paid on deposits in the 2010 third quarter declined further to 1.17%.
Over 95% of the growth in the average balances of deposits were used to pay off higher cost borrowed funds and brokered deposits. The average balance of deposits (excluding brokered deposits) to the average balance of all deposits and borrowings increased from 68.6% in the 2009 nine month period to 79.2% in the 2010 nine month period. The average balance of loans to the average balance of deposits (excluding brokered deposits) declined from 147.0% to 128.8% in those respective periods. At September 30, 2010, deposits equaled 82.3% of all deposits and borrowed funds and loans equaled 124.4% of deposits.
The provisions for credit losses in the 2010 and 2009 third quarters were $551,000 and $2,473,000, respectively, while net loan charge-offs in those periods were $826,000 (an annualized charge-off rate of 0.15% based on average loans outstanding) and $1,820,000 (0.34%), respectively. The provisions for credit losses in the 2010 and 2009 nine month periods were $2,479,000 and $7,150,000, respectively, while net loan charge-offs in those periods were $3,200,000 (0.20%) and $5,420,000 (0.34%), respectively.
The provisions for credit losses were higher than net loan charge-offs in the 2009 quarterly and nine month periods because of growth in the loan portfolio and concern about the growing trend in problem loans and net charge-offs, especially relating to indirect auto loans and loans in the portfolio of Eastern Funding, a specialty finance subsidiary of the Company. In the 2009 nine month period, loans (excluding deferred loan origination costs) increased $65.0 million despite decreases in indirect auto loans and one-to-four family mortgage loans of $30.3 million and $19.5 million, respectively.
The provisions for credit losses were less than net loan charge-offs in the 2010 quarterly and nine month periods due primarily to a significantly lower rate of indirect auto loan net charge-offs than contemplated which resulted in a lowering of the level of allowance for loan losses considered adequate for that segment of the loan portfolio. In the 2010 nine month period, loan growth (excluding deferred loan origination costs) was modest at $24.8 million, or 1.2%. Eastern Funding loans increased $28.3 million (17.1%) due in part to the purchase of $11.8 million of seasoned loans in the 2010 third quarter. Increases in multi-family mortgage loans and commercial real estate loans of $22.0 million and $10.7 million, respectively, were offset by reductions in one-to-four family mortgage loans and commercial loans of $33.9 million and $4.5 million, respectively.
Net charge-offs of indirect auto loans declined to $627,000 in the 2010 third quarter (an annualized rate of 0.46% based on average loans outstanding during that period excluding deferred loan origination costs) and $2,227,000 (0.55%) in the 2010 nine month period from $1,348,000 (0.95%) in the 2009 third quarter and $4,438,000 (1.02%) in the 2009 nine month period. Indirect auto loan net charge-offs had equaled 1.00% in 2009 and 1.12% in 2008. Since the Company commenced originating indirect auto loans in 2003, 8% of such originations were to borrowers with credit scores below 660. In the year 2009 and the 2010 nine month period, loan originations to borrowers with credit scores below 660 declined to 2.5% and 2.0%, respectively. Indirect auto loans delinquent over 30 days declined to $7.3 million (1.35% of loans outstanding) at September 30, 2010 from $8.0 million (1.47%) at June 30, 2010 and $11.0 million (2.02%) at December 31, 2009. The allowance for loan losses related to indirect auto loans (excluding deferred loan origination costs) was $7,422,000 (1.37% of loans outstanding) at September 30, 2010 compared to $7,873,000 (1.45%) at June 30, 2010 and $8,479,000 (1.57%) at December 31, 2009.
Net charge-offs of Eastern Funding loans in the 2010 and 2009 third quarters were $212,000 and $152,000, respectively, and in the 2010 and 2009 nine month periods $664,000 and $660,000, respectively. Additionally, write-downs of assets acquired were $53,000, $72,000, $186,000 and $429,000, respectively. The annualized rate of net charge-offs, combined with write-downs of assets acquired, equaled 0.58%, 0.58%, 0.64% and 0.96%, respectively. The allowance for loan losses related to Eastern Funding loans (excluding deferred loan origination costs) was $3,602,000 (1.86% of loans outstanding) at September 30, 2010 compared to $3,643,000 (2.01%) at June 30, 2010 and $3,057,000 (1.85%) at December 31, 2009.
Additional net loan charge-offs in the 2010 and 2009 nine month periods were $309,000 and $322,000, respectively. Substantially all of those amounts related to one commercial real estate loan for which a specific reserve had been previously established. Excluding Eastern Funding loans ($2,683,000) and indirect auto loans ($121,000), other loans on non-accrual amounted to $2,340,000 at September 30, 2010, $1,241,000 of which was one-to-four family mortgage loans. Restructured loans on accrual included $4.1 million of one-to-four family mortgage loans, $2.3 million of commercial real estate loans and $1.0 million of Eastern Funding loans.
In the 2010 third quarter, $15.9 million of borrowings from the FHLB with a weighted average interest rate of 4.24% and maturing within approximately ten months were prepaid resulting in a penalty of $555,000 and, in the same quarter, $12.0 million was re-borrowed from the FHLB at a weighted average interest rate of 0.93% and a weighted average life to maturity of 2.5 years. In the 2010 second quarter, $24 million of FHLB borrowings with a weighted average rate of 4.03% and maturing within approximately one year were prepaid resulting in a penalty of $913,000 and, in the same quarter, $24 million was re-borrowed from the FHLB at a weighted average annual rate of 2.02% for 3.26 years. Prepayments of FHLB borrowings in the 2009 third quarter and nine month period resulted in penalties of $533,000 and $1,115,000, respectively.
Investment securities (primarily equity securities) were sold in the 2010 second quarter at a gain of $834,000. Mortgage-backed securities were sold in the 2009 second and third quarters at gains of $346,000 and $594,000, respectively. On an after tax basis, those gains primarily offset penalties incurred in the same periods from prepayment of FHLB borrowings. Impairment loss on securities, net of non-credit impairment loss, in the 2010 and 2009 nine month periods of $49,000 and $726,000, respectively, resulted from write-downs of perpetual preferred stock and a trust preferred security.
Fees, charges and other income remained relatively constant in the 2010 and 2009 quarters at $927,000, and $934,000, respectively, and in the 2010 and 2009 nine month periods at $2,885,000 and $2,838,000, respectively. As a result of recent overdraft legislation, overdraft fees declined and are expected to continue to decline prospectively. The amounts of decline, however, are not expected to have a significant effect on earnings.
Total non-interest expenses were $11.9 million in the 2010 third quarter compared to $11.1 million in the 2009 third quarter, an increase of 6.7%, and $35.6 million in the 2010 nine month period compared to $34.4 million in the 2009 nine month period, an increase of 3.4%. The increases resulted primarily from higher compensation and employee benefits due in part to added personnel in business banking and investment advisory services and higher bonus accruals, the opening of two new branches in June 2010, higher marketing expenses due in part to product promotions and higher professional fees related to corporate issues and initiatives, offset in part by lower FDIC insurance expense (2009 included a $1.1 million special assessment) and a reduction in loan collection related expenses.
The above text contains statements about future events that constitute forward looking statements. Projections about future events are subject to risks and uncertainties that could cause actual results to differ materially. Factors that could cause such differences include, but are not limited to, general economic conditions, changes in interest rates, regulatory considerations and competition.
BROOKLINE BANCORP, INC. AND SUBSIDIARIES Consolidated Balance Sheets (In thousands except share data) | ||||||||||||||
| ||||||||||||||
| September 30, | June 30, | December 31, | ||||||||||||
| 2010 | 2010 | 2009 | ||||||||||||
ASSETS | ||||||||||||||
| Cash and due from banks | $ | 18,870 | $ | 20,592 | $ | 17,635 | ||||||||
| Short-term investments | 49,349 | 67,622 | 48,886 | |||||||||||
| Securities available for sale | 310,664 | 306,504 | 293,023 | |||||||||||
| Securities held to maturity (market value of $97, $124 and $121, respectively) | 87 | 110 | 112 | |||||||||||
| Restricted equity securities | 36,335 | 36,335 | 36,335 | |||||||||||
| Loans | 2,189,014 | 2,172,465 | 2,164,295 | |||||||||||
| Allowance for loan losses | (30,362 | ) | (30,637 | ) | (31,083 | ) | ||||||||
| Net loans | 2,158,652 | 2,141,828 | 2,133,212 | |||||||||||
| Accrued interest receivable | 8,581 | 8,556 | 9,062 | |||||||||||
| Bank premises and equipment, net | 11,374 | 11,477 | 10,685 | |||||||||||
| Deferred tax asset | 9,012 | 9,325 | 10,178 | |||||||||||
| Prepaid income taxes | 782 | 371 | - | |||||||||||
| Goodwill | 43,241 | 43,241 | 43,241 | |||||||||||
| Identified intangible assets, net of accumulated amortization of $10,775, $10,469 and $9,857, respectively | 2,177 | 2,483 | 3,095 | |||||||||||
| Other assets | 11,272 | 10,974 | 10,420 | |||||||||||
| Total assets | $ | 2,660,396 | $ | 2,659,418 | $ | 2,615,884 | ||||||||
LIABILITIES AND EQUITY | ||||||||||||||
| Deposits | $ | 1,760,271 | $ | 1,702,658 | $ | 1,633,687 | ||||||||
| Borrowed funds | 378,234 | 439,254 | 468,766 | |||||||||||
| Mortgagors’ escrow accounts | 6,225 | 6,079 | 5,938 | |||||||||||
| Income taxes payable | - | - | 1,115 | |||||||||||
| Accrued expenses and other liabilities | 18,112 | 16,949 | 16,955 | |||||||||||
| Total liabilities | 2,162,842 | 2,164,940 | 2,126,461 | |||||||||||
| Equity: | ||||||||||||||
| Brookline Bancorp, Inc. stockholders’ equity: | ||||||||||||||
| Preferred stock, $0.01 par value; 50,000,000 shares authorized; none issued | - | - | - | |||||||||||
| Common stock, $0.01 par value; 200,000,000 shares authorized; 64,436,889 shares, 64,411,889 shares and 64,404,419 shares issued, respectively | 644 | 644 | 644 | |||||||||||
| Additional paid-in capital | 524,336 | 524,191 | 523,736 | |||||||||||
| Retained earnings, partially restricted | 30,937 | 28,876 | 25,420 | |||||||||||
| Accumulated other comprehensive income | 3,828 | 3,257 | 2,201 | |||||||||||
| Treasury stock, at cost - 5,373,733 shares | (62,107 | ) | (62,107 | ) | (62,107 | ) | ||||||||
| Unallocated common stock held by ESOP – 436,469 shares, 448,514 shares and 472,604 shares, respectively | (2,381 | ) | (2,445 | ) | (2,577 | ) | ||||||||
| Total Brookline Bancorp, Inc. stockholders’ equity | 495,257 | 492,416 | 487,317 | |||||||||||
| Noncontrolling interest in subsidiary | 2,297 | 2,062 | 2,106 | |||||||||||
| Total equity | 497,554 | 494,478 | 489,423 | |||||||||||
| Total liabilities and equity | $ | 2,660,396 | $ | 2,659,418 | $ | 2,615,884 | ||||||||
BROOKLINE BANCORP, INC. AND SUBSIDIARIES Consolidated Statements of Income (In thousands except share data) | ||||||||||||||||||
| Three months ended | Nine months ended | |||||||||||||||||
| September 30, | September 30, | |||||||||||||||||
| 2010 | 2009 | 2010 | 2009 | |||||||||||||||
| Interest income: | ||||||||||||||||||
| Loans | $ | 30,488 | $ | 31,722 | $ | 92,130 | $ | 96,583 | ||||||||||
| Debt securities | 1,927 | 2,528 | 5,810 | 8,449 | ||||||||||||||
| Short-term investments | 32 | 48 | 76 | 296 | ||||||||||||||
| Equity securities | 4 | 24 | 40 | 71 | ||||||||||||||
| Total interest income | 32,451 | 34,322 | 98,056 | 105,399 | ||||||||||||||
| Interest expense: | ||||||||||||||||||
| Deposits (excluding brokered deposits) | 5,096 | 7,300 | 16,355 | 24,060 | ||||||||||||||
| Brokered deposits | - | - | - | 424 | ||||||||||||||
| Borrowed funds | 3,087 | 5,247 | 10,560 | 18,217 | ||||||||||||||
| Total interest expense | 8,183 | 12,547 | 26,915 | 42,701 | ||||||||||||||
| Net interest income | 24,268 | 21,775 | 71,141 | 62,698 | ||||||||||||||
| Provision for credit losses | 551 | 2,473 | 2,479 | 7,150 | ||||||||||||||
| Net interest income after provision for credit losses | 23,717 | 19,302 | 68,662 | 55,548 | ||||||||||||||
| Non-interest income: | ||||||||||||||||||
| Fees, charges and other income | 927 | 934 | 2,885 | 2,838 | ||||||||||||||
| Penalty from prepayment of borrowed funds | (555 | ) | (533 | ) | (1,468 | ) | (1,115 | ) | ||||||||||
| Gain on sales of securities | - | 594 | 834 | 940 | ||||||||||||||
| Loss on impairment of securities | - | - | (49 | ) | (779 | ) | ||||||||||||
| Less non-credit loss on impairment of securities | - | - | - | 53 | ||||||||||||||
| Total non-interest income | 372 | 995 | 2,202 | 1,937 | ||||||||||||||
| Non-interest expense: | ||||||||||||||||||
| Compensation and employee benefits | 5,895 | 5,195 | 17,008 | 15,455 | ||||||||||||||
| Occupancy | 1,128 | 1,015 | 3,373 | 3,153 | ||||||||||||||
| Equipment and data processing | 1,874 | 1,868 | 5,586 | 5,495 | ||||||||||||||
| Professional services | 668 | 566 | 2,599 | 1,787 | ||||||||||||||
| FDIC insurance | 418 | 435 | 1,246 | 2,438 | ||||||||||||||
| Advertising and marketing | 359 | 283 | 900 | 700 | ||||||||||||||
| Amortization of identified intangible assets | 306 | 372 | 918 | 1,116 | ||||||||||||||
| Other | 1,245 | 1,410 | 3,960 | 4,263 | ||||||||||||||
| Total non-interest expense | 11,893 | 11,144 | 35,590 | 34,407 | ||||||||||||||
| Income before income taxes | 12,196 | 9,153 | 35,274 | 23,078 | ||||||||||||||
| Provision for income taxes | 4,923 | 3,723 | 14,239 | 9,362 | ||||||||||||||
| Net income | 7,273 | 5,430 | 21,035 | 13,716 | ||||||||||||||
| Less net income attributable to noncontrolling interest in subsidiary | 235 | 188 | 561 | 352 | ||||||||||||||
| Net income attributable to Brookline Bancorp, Inc. | $ | 7,038 | $ | 5,242 | $ | 20,474 | $ | 13,364 | ||||||||||
| Earnings per common share attributable to Brookline Bancorp, Inc.: | ||||||||||||||||||
| Basic | $ | 0.12 | $ | 0.09 | $ | 0.35 | $ | 0.23 | ||||||||||
| Diluted | 0.12 | 0.09 | 0.35 | 0.23 | ||||||||||||||
Weighted average common shares outstanding during the period: | ||||||||||||||||||
| Basic | 58,586,274 | 58,522,547 | 58,571,938 | 58,313,465 | ||||||||||||||
| Diluted | 58,588,536 | 58,529,929 | 58,576,080 | 58,361,623 | ||||||||||||||
BROOKLINE BANCORP, INC. AND SUBSIDIARIES Average Yields / Costs | |||||||||||||||||||||||||||
| Three months ended | |||||||||||||||||||||||||||
| September 30, 2010 | June 30, 2010 | ||||||||||||||||||||||||||
Average | Interest (1) | Average | Average | Interest (1) | Average | ||||||||||||||||||||||
| (Dollars in thousands) | |||||||||||||||||||||||||||
Assets | |||||||||||||||||||||||||||
| Interest-earning assets: | |||||||||||||||||||||||||||
| Short-term investments | $ | 58,766 | $ | 32 | 0.22 | % | $ | 70,586 | $ | 29 | 0.16 | % | |||||||||||||||
| Debt securities (2) | 310,337 | 1,932 | 2.49 | 298,168 | 1,965 | 2.64 | |||||||||||||||||||||
| Equity securities (2) | 36,810 | 5 | 0.06 | 38,042 | 16 | 0.17 | |||||||||||||||||||||
| Mortgage loans (3)(4) | 1,252,610 | 16,466 | 5.26 | 1,251,800 | 16,600 | 5.30 | |||||||||||||||||||||
| Home equity loans (3) | 54,208 | 522 | 3.82 | 52,404 | 499 | 3.82 | |||||||||||||||||||||
| Commercial loans -Eastern Funding (3) | 183,573 | 3,867 | 8.43 | 175,775 | 3,737 | 8.50 | |||||||||||||||||||||
| Other commercial loans (3) | 119,538 | 1,455 | 4.84 | 133,333 | 1,589 | 4.78 | |||||||||||||||||||||
| Indirect automobile loans (3) | 556,470 | 8,098 | 5.77 | 557,105 | 8,268 | 5.95 | |||||||||||||||||||||
| Other consumer loans (3) | 6,098 | 79 | 5.18 | 7,126 | 81 | 4.55 | |||||||||||||||||||||
| Total interest-earning assets | 2,578,410 | 32,456 | 5.02 | % | 2,584,339 | 32,784 | 5.08 | % | |||||||||||||||||||
| Allowance for loan losses | (30,517 | ) | (30,764 | ) | |||||||||||||||||||||||
| Non-interest earning assets | 108,199 | 108,260 | |||||||||||||||||||||||||
| Total assets | $ | 2,656,092 | $ | 2,661,835 | |||||||||||||||||||||||
Liabilities and Equity | |||||||||||||||||||||||||||
| Interest-bearing liabilities: | |||||||||||||||||||||||||||
| Deposits: | |||||||||||||||||||||||||||
| NOW accounts | $ | 109,890 | 40 | 0.14 | % | $ | 108,768 | 40 | 0.15 | % | |||||||||||||||||
| Savings accounts | 106,685 | 214 | 0.80 | 102,687 | 205 | 0.80 | |||||||||||||||||||||
| Money market savings accounts | 629,712 | 1,640 | 1.03 | 592,012 | 1,625 | 1.10 | |||||||||||||||||||||
| Certificates of deposit | 782,888 | 3,202 | 1.62 | 786,834 | 3,478 | 1.77 | |||||||||||||||||||||
| Total interest-bearing deposits (4) | 1,629,175 | 5,096 | 1.24 | 1,590,301 | 5,348 | 1.35 | |||||||||||||||||||||
| Borrowed funds | 401,679 | 3,083 | 3.00 | 459,278 | 3,699 | 3.19 | |||||||||||||||||||||
| Federal funds purchased | 4,652 | 3 | 0.25 | - | - | - | |||||||||||||||||||||
| Total interest bearing liabilities | 2,035,506 | 8,182 | 1.59 | % | 2,049,579 | 9,047 | 1.77 | % | |||||||||||||||||||
| Non-interest-bearing demand checking accounts (4) | 101,075 | 94,946 | |||||||||||||||||||||||||
| Other liabilities | 22,433 | 23,770 | |||||||||||||||||||||||||
| Total liabilities | 2,159,014 | 2,168,295 | |||||||||||||||||||||||||
| Brookline Bancorp, Inc. stockholders’ equity | 494,890 | 491,508 | |||||||||||||||||||||||||
| Noncontrolling interest in subsidiary | 2,188 | 2,032 | |||||||||||||||||||||||||
| Total liabilities and equity | $ | 2,656,092 | $ | 2,661,835 | |||||||||||||||||||||||
| Net interest income (tax equivalent basis)/interest rate spread (5) | 24,274 | 3.43 | % | 23,737 | 3.31 | % | |||||||||||||||||||||
| Less adjustment of tax exempt income | 6 | 9 | |||||||||||||||||||||||||
| Net interest income | $ | 24,268 | $ | 23,728 | |||||||||||||||||||||||
| Net interest margin (6) | 3.76 | % | 3.67 | % | |||||||||||||||||||||||
(1) Tax exempt income on equity securities and municipal bonds is included on a tax equivalent basis. | |||||||||||||||||||||||||||
(2) Average balances include unrealized gains (losses) on securities available for sale. Equity securities include marketable equity securities (preferred and common stocks) and restricted equity securities. | |||||||||||||||||||||||||||
(3) Loans on non-accrual status are included in average balances. | |||||||||||||||||||||||||||
(4) Including non-interest bearing checking accounts, the average interest rate on total deposits was 1.17% in the three months ended September 30, 2010 and 1.27% in the three months ended June 30, 2010. | |||||||||||||||||||||||||||
(5) Interest rate spread represents the difference between the yield on interest-earning assets and the cost of interest-bearing liabilities. | |||||||||||||||||||||||||||
(6) Net interest margin represents net interest income (tax equivalent basis) divided by average interest-earning assets. | |||||||||||||||||||||||||||
BROOKLINE BANCORP, INC. AND SUBSIDIARIES Average Yields / Costs | |||||||||||||||||||||||||||
| Nine months ended | |||||||||||||||||||||||||||
| September 30, 2010 | September 30, 2009 | ||||||||||||||||||||||||||
Average | Interest (1) | Average yield/ cost | Average balance | Interest (1) | Average yield/ cost | ||||||||||||||||||||||
| (Dollars in thousands) | |||||||||||||||||||||||||||
Assets | |||||||||||||||||||||||||||
| Interest-earning assets: | |||||||||||||||||||||||||||
| Short-term investments | $ | 61,175 | $ | 76 | 0.17 | % | $ | 92,218 | $ | 296 | 0.43 | % | |||||||||||||||
| Debt securities (2) | 298,313 | 5,827 | 2.60 | 291,562 | 8,474 | 3.88 | |||||||||||||||||||||
| Equity securities (2) | 37,613 | 54 | 0.19 | 37,527 | 97 | 0.34 | |||||||||||||||||||||
| Mortgage loans (3)(4) | 1,251,985 | 49,796 | 5.30 | 1,219,234 | 52,156 | 5.70 | |||||||||||||||||||||
| Home equity loans (3) | 52,799 | 1,508 | 3.82 | 46,206 | 1,278 | 3.69 | |||||||||||||||||||||
| Commercial loans -Eastern Funding (3) | 176,041 | 11,207 | 8.49 | 151,753 | 10,286 | 9.04 | |||||||||||||||||||||
| Other commercial loans (3) | 128,329 | 4,610 | 4.80 | 120,080 | 4,181 | 4.64 | |||||||||||||||||||||
| Indirect automobile loans (3) | 554,834 | 24,767 | 5.97 | 593,475 | 28,525 | 6.41 | |||||||||||||||||||||
| Other consumer loans (3) | 6,624 | 242 | 4.87 | 3,878 | 157 | 5.40 | |||||||||||||||||||||
| Total interest-earning assets (4) | 2,567,713 | 98,087 | 5.10 | % | 2,555,933 | 105,450 | 5.50 | % | |||||||||||||||||||
| Allowance for loan losses | (30,760 | ) | (28,867 | ) | |||||||||||||||||||||||
| Non-interest earning assets | 109,559 | 104,166 | |||||||||||||||||||||||||
| Total assets | $ | 2,646,512 | $ | 2,631,232 | |||||||||||||||||||||||
Liabilities and Equity | |||||||||||||||||||||||||||
| Interest-bearing liabilities: | |||||||||||||||||||||||||||
| Deposits: | |||||||||||||||||||||||||||
| NOW accounts | $ | 105,696 | 112 | 0.14 | % | $ | 89,228 | 127 | 0.19 | % | |||||||||||||||||
| Savings accounts | 102,196 | 617 | 0.81 | 90,109 | 714 | 1.06 | |||||||||||||||||||||
| Money market savings accounts | 590,723 | 4,877 | 1.10 | 354,927 | 4,328 | 1.63 | |||||||||||||||||||||
| Certificates of deposit | 792,494 | 10,749 | 1.81 | 844,795 | 18,891 | 2.98 | |||||||||||||||||||||
| Total interest-bearing deposits excluding brokered deposits (5) | 1,591,109 | 16,355 | 1.37 | 1,379,059 | 24,060 | 2.33 | |||||||||||||||||||||
| Brokered deposits | - | - | - | 10,573 | 424 | 5.35 | |||||||||||||||||||||
| Total deposits | 1,591,109 | 16,355 | 1.37 | 1,389,632 | 24,484 | 2.35 | |||||||||||||||||||||
| Borrowed funds | 441,905 | 10,557 | 3.15 | 655,421 | 18,217 | 3.71 | |||||||||||||||||||||
| Federal funds purchased | 1,568 | 3 | 0.22 | - | - | - | |||||||||||||||||||||
| Total interest bearing liabilities | 2,034,582 | 26,915 | 1.77 | % | 2,045,053 | 42,701 | 2.78 | % | |||||||||||||||||||
| Non-interest-bearing demand checking accounts (5) | 94,373 | 73,288 | |||||||||||||||||||||||||
| Other liabilities | 23,307 | 23,741 | |||||||||||||||||||||||||
| Total liabilities | 2,152,262 | 2,142,082 | |||||||||||||||||||||||||
| Brookline Bancorp, Inc. stockholders’ equity | 492,113 | 487,358 | |||||||||||||||||||||||||
| Noncontrolling interest in subsidiary | 2,137 | 1,792 | |||||||||||||||||||||||||
| Total liabilities and equity | $ | 2,646,512 | $ | 2,631,232 | |||||||||||||||||||||||
| Net interest income (tax equivalent basis)/interest rate spread (4)(6) | 71,172 | 3.33 | % | 62,749 | 2.72 | % | |||||||||||||||||||||
| Less adjustment of tax exempt income | 31 | 51 | |||||||||||||||||||||||||
| Net interest income | $ | 71,141 | $ | 62,698 | |||||||||||||||||||||||
| Net interest margin (4)(7) | 3.70 | % | 3.27 | % | |||||||||||||||||||||||
(1) Tax exempt income on equity securities and municipal bonds is included on a tax equivalent basis. | |||||||||||||||||||||||||||
(2) Average balances include unrealized gains (losses) on securities available for sale. Equity securities include marketable equity securities (preferred and common stocks) and restricted equity securities. | |||||||||||||||||||||||||||
(3) Loans on non-accrual status are included in average balances. | |||||||||||||||||||||||||||
(4) In the 2009 period, interest income included $1,614 due to the payoff of a loan on which there was unaccreted interest. Excluding this income, the yield on mortgage loans and interest-earning assets would have been 5.53% and 5.42%, respectively. Interest rate spread and net interest margin would have been 2.64% and 3.19%, respectively. | |||||||||||||||||||||||||||
(5) Including non-interest bearing checking accounts, the average interest rate on total deposits (excluding brokered deposits) was 1.30% in the 2010 period and 2.21% in the 2009 period. | |||||||||||||||||||||||||||
(6) Interest rate spread represents the difference between the yield on interest-earning assets and the cost of interest-bearing liabilities. | |||||||||||||||||||||||||||
(7) Net interest margin represents net interest income (tax equivalent basis) divided by average interest-earning assets. | |||||||||||||||||||||||||||
BROOKLINE BANCORP, INC. AND SUBSIDIARIES Selected Financial Ratios and Other Data | ||||||||||||||||||
| Three months ended | Nine months ended | |||||||||||||||||
| September 30, | September 30, | |||||||||||||||||
| 2010 | 2009 | 2010 | 2009 | |||||||||||||||
| Performance Ratios (annualized): | ||||||||||||||||||
| Return on average assets | 1.06 | % | 0.79 | % | 1.03 | % | 0.68 | % | ||||||||||
| Return on average stockholders’ equity | 5.69 | % | 4.31 | % | 5.55 | % | 3.66 | % | ||||||||||
| Interest rate spread | 3.43 | % | 2.90 | % | 3.33 | % | 2.72 | % | (A) | |||||||||
| Net interest margin | 3.76 | % | 3.39 | % | 3.70 | % | 3.27 | % | (A) | |||||||||
(A) Excluding interest income of $1,614,000 due to the payoff of a loan on which there was unaccreted discount, interest rate spread and net interest margin would have been 2.64% and 3.19%, respectively. | ||||||||||||||||||
| Dividends paid per share during period | $ | 0.085 | $ | 0.085 | $ | 0.255 | $ | 0.455 | ||||||||||
| At | At | At | |||||||||||||||
| September 30, | June 30, | December 31, | |||||||||||||||
| 2010 | 2010 | 2009 | |||||||||||||||
| (dollars in thousands except per share data) | |||||||||||||||||
| Capital Ratio: | |||||||||||||||||
| Stockholders’ equity to total assets | 18.62 | % | 18.52 | % | 18.63 | % | |||||||||||
| Tangible stockholders’ equity to total assets | 17.20 | % | 17.09 | % | 17.16 | % | |||||||||||
| Asset Quality: | |||||||||||||||||
| Non-accrual loans | $ | 5,144 | $ | 5,119 | $ | 6,233 | |||||||||||
| Non-performing assets | 6,022 | 6,030 | 7,663 | ||||||||||||||
| Restructured loans on accrual | 7,396 | 6,968 | 3,898 | ||||||||||||||
| Allowance for loan losses | 30,362 | 30,637 | 31,083 | ||||||||||||||
| Allowance for loan losses as a percent of total loans | 1.39 | % | 1.41 | % | 1.44 | % | |||||||||||
| Non-accrual loans as a percent of total loans | 0.23 | % | 0.24 | % | 0.29 | % | |||||||||||
| Non-performing assets as a percent of total assets | 0.23 | % | 0.23 | % | 0.29 | % | |||||||||||
| Per Share Data: | |||||||||||||||||
| Book value per share | $ | 8.39 | $ | 8.34 | $ | 8.26 | |||||||||||
| Tangible book value per share | 7.62 | 7.57 | 7.47 | ||||||||||||||
| Market value per share | 9.98 | 8.88 | 9.91 | ||||||||||||||
CONTACT:
Brookline Bancorp, Inc.
Paul Bechet, 617-278-6405