EXHIBIT 99.1
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FOR IMMEDIATE RELEASE | CONTACT: | Sandy Pfaff |
| | | 415-819-7447 |
| | | sandy@pfaffpr.com |
BANK OF MARIN BANCORP REPORTS RECORD QUARTERLY EARNINGS OF $5.2 MILLION
NOVATO, CA, July 21, 2014 - Bank of Marin Bancorp, "Bancorp" (NASDAQ: BMRC), parent company of Bank of Marin, announced record earnings of $5.2 million in the second quarter of 2014, compared to $4.5 million in the first quarter of 2014 and $3.1 million in the second quarter of 2013. Diluted earnings per share totaled $0.86 in the second quarter, compared to $0.76 in the prior quarter and $0.55 in the same quarter a year ago. June 30, 2014 year-to-date earnings totaled $9.7 million compared to $7.9 million for the same period a year ago. Diluted earnings per share for the six-month period totaled $1.62 as compared to $1.44 for the same period in 2013.
“We are pleased to report record earnings this quarter, driven by new loan and core deposit growth across the franchise,” said Russell A. Colombo, President and Chief Executive Officer. “The Bank is built on a foundation of strong credit quality and a commitment to our long-term strategy as a relationship-driven, community bank.”
Bancorp also provided the following highlights on its operating and financial performance for the second quarter of 2014:
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| • | Loans grew to $1.3 billion, an increase of $60.5 million, or 4.7%, over March 31, 2014, and $247.0 million, or 22.6% over June 30, 2013. The increase in loans from a year ago reflects both acquired loans and organic growth. Credit quality improved with non-accrual loans representing 0.76% of total loans at June 30, 2014, down from 0.79% at March 31, 2014 and 1.69% a year ago. Net recoveries for the second quarter totaled $68 thousand, compared to net charge-offs of $142 thousand in the prior quarter and net charge-offs of $177 thousand in the same quarter a year ago. |
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| • | Non-interest expense totaled $11.5 million in the second quarter of 2014, a decrease of $1.4 million, or 10.8%, compared to the prior quarter. The second quarter of 2104 reflects normalization of non-interest expense with significant drops in salaries and related benefits, data processing costs and professional services as the expenses of the merger with NorCal Community Bancorp (NorCal”), parent company of Bank of Alameda, were fully absorbed in the fourth quarter of 2013 and the first quarter of 2014. |
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| • | Developments during the quarter included the relocation of our Sausalito branch, the third in the Bank’s strategy to reduce square footage as customers increasingly utilize online banking channels. Regarding key products, the Bank reinstated its floating home loan program as of July 1 and has been successful with Tenant in Common loans in the San Francisco market. After an extensive review, the Bank is discontinuing the small mortgage brokerage acquired from NorCal as the broker model is not consistent with Bank of Marin's underwriting philosophy. The financial impact is not material. |
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| • | The total risk-based capital ratio for Bancorp was 13.5% at both June 30, 2014 and March 31, 2014, compared to 14.0% at June 30, 2013. The ratio declined as compared to the same quarter a year ago due to $10.6 million in goodwill and intangibles related to the NorCal acquisition, which are excluded from regulatory capital. The risk-based capital ratio continues to be well above regulatory requirements for a well-capitalized institution as well as new requirements that will take effect in 2015 (Basel Committee on Bank Supervision guidelines for determining regulatory capital). Tangible common equity to tangible assets totaled 9.9% at June 30, 2014, compared to 9.8% at the end of the prior quarter. |
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| • | Quarterly return on assets (“ROA”) of 1.14% at June 30, 2014, increased from 1.01% at March 31, 2014 and 0.86% a year ago. Quarterly return on equity (“ROE”) totaled 10.96% at June 30, 2014, compared to 9.97% at March 31, 2014 and 7.72% at June 30, 2013. The increase in ROA and ROE in the current quarter was driven by record earnings. |
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| • | On July 18, 2014, the Board of Directors declared a quarterly cash dividend of $0.20 per share, a $0.01 increase from prior quarter. The cash dividend is payable to shareholders of record at the close of business on August 1, 2014 and will be payable on August 8, 2014. |
Loans and Credit Quality
Gross loans increased $60.5 million from the prior quarter, which was driven by an increase in commercial real estate and commercial and industrial loans. Loans increased $247.0 million from a year ago which reflects both loans acquired from NorCal and organic growth. Non-accrual loans decreased from $18.5 million a year ago to $10.1 million at June 30, 2014 and March 31, 2014. The decrease in non-accrual loans from June 30, 2013 primarily relates to $6.5 million in pay-offs and pay-downs associated with two borrowers. Accruing loans past due 30 to 89 days totaled $1.5 million at June 30, 2014, compared to $2.8 million at March 31, 2014 and $566 thousand a year ago.
The provision for loan losses of $600 thousand in the second quarter of 2014 relates to loan growth and compares to $150 thousand in the prior quarter and $1.1 million in the same quarter a year ago. The ratio of loan loss reserve to loans remained unchanged from March 31, 2014 at 1.11%. The decline compared to 1.32% at June 30, 2013 is primarily due to the loans acquired from Bank of Alameda marked down to fair value without allowances established.
Deposits
Deposits totaled $1.6 billion at both June 30, 2014 and March 31, 2014, an increase of $374 million compared to $1.2 billion at June 30, 2013. The increase in deposits from a year ago reflects the Bank's move into the East Bay market as well as organic growth in the Marin and Sonoma markets, with higher balances seen in all deposit categories except CDARS time deposits. Non-interest bearing deposits totaled $724 million at June 30, 2014, an increase of $23.4 million when compared to March 31, 2014, and represented 45.3% of total deposits as of June 30, 2014, up from 44.5% at the prior quarter-end and 40.7% at June 30, 2013.
Earnings
“Discipline around balance sheet and expense management contributed to the strong results for the quarter as did the absence of nonrecurring acquisition expenses” said Tani Girton, Chief Financial Officer. “The Bank’s stable net interest margin, improved efficiency ratio, and solid return on assets reflect our continued focus on those areas.”
Net interest income totaled $17.9 million in both the second quarter of 2014 and the prior quarter, compared to $14.3 million in the same quarter a year ago. The increase from the same quarter a year
ago relates to higher balances on loans and investments, as well as accretion and gains on pay-offs of acquired loans. The tax-equivalent net interest margin was 4.23%, 4.25% and 4.30% for those respective periods. The decrease in the second quarter of 2014 compared to the same quarter a year ago primarily relates to the impact of the low interest rate environment on the loan portfolio and higher cash balances as a percentage of interest-earning assets, partially offset by the accretion and gains on pay-offs of acquired loans.
Summary of Charter Oak and NorCal acquisitions' impact on net interest margin:
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| | Three months ended |
| | June 30, 2014 | | March 31, 2014 | | June 30, 2013 |
| (dollars in thousands; unaudited) | Dollar Amount | Basis point impact to net interest margin | | Dollar Amount | Basis point impact to net interest margin | | Dollar Amount | Basis point impact to net interest margin |
| Accretion on PCI loans | | $ | 187 |
| | 4 bps | | | $ | 180 |
| | 4 bps | | | $ | 156 |
| | 5 bps |
| Accretion on non-PCI loans | | $ | 713 |
| | 17 bps | | | $ | 1,330 |
| | 31 bps | | | $ | 246 |
| | 7 bps |
| Gains on pay-offs of PCI loans | | $ | 622 |
| | 14 bps | | | $ | — |
| | 0 bps | | | $ | 149 |
| | 4 bps |
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| | Six months ended | |
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| | June 30, 2014 | | June 30, 2013 | |
| (dollars in thousands; unaudited) | Dollar Amount | Basis point impact to net interest margin | | Dollar Amount | Basis point impact to net interest margin | |
| Accretion on PCI loans | $ | 367 |
| 4 bps | | $ | 392 |
| 6 bps | |
| Accretion on non-PCI loans | $ | 2,043 |
| 24 bps | | $ | 378 |
| 6 bps | |
| Gains on pay-offs of PCI loans | $ | 622 |
| 7 bps | | $ | 469 |
| 7 bps | |
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For acquired loans not considered credit-impaired, the level of accretion varies due to maturities and early pay-offs of these loans. Accretion on PCI loans fluctuates based on changes in cash flows expected to be collected. Gains on pay-offs of PCI loans are recorded as interest income when the pay-off amounts exceed the recorded investment.
Non-interest income in the second quarter of 2014 totaled $2.4 million, compared to $2.2 million in the prior quarter and $1.9 million in the same quarter a year ago. The increase from the same quarter a year ago primarily relates to gains on the sale of investment securities, higher dividend income from the Federal Home Loan Bank of San Francisco and higher debit card interchange fees.
Non-interest expense totaled $11.5 million in the second quarter of 2014, compared to $12.8 million in the prior quarter and $10.4 million in the same quarter a year ago. Second quarter 2014 non-interest expense decreased $1.4 million, or 10.8%, compared to the prior quarter, primarily related to the absence of acquisition-related expenses and miscellaneous cost savings in the second quarter. The increase in non-interest expense from the same quarter a year ago reflects the higher cost base associated with a larger-sized Bank, expansion into the East Bay, and increased lending staff in the North Bay.
Earnings Call and Webcast Information
Bank of Marin Bancorp will webcast its second quarter earnings call on Monday, July 21, 2014 at 8:30 a.m. PT/ 11:30 a.m. ET. Investors will have the opportunity to listen to the conference call online through Bank of Marin’s web site at http://www.bankofmarin.com under “Latest Press and News.” To listen to the live call, please go to the website at least 15 minutes early to register, download and install any necessary audio software. For those who cannot listen to the live broadcast, a replay will be available at the same website location shortly after the call.
About Bank of Marin Bancorp
Bank of Marin is a leading business and community bank in the San Francisco Bay Area, with assets of $1.8 billion. Founded in 1989 and headquartered in Novato, Bank of Marin is the sole subsidiary of Bank of Marin Bancorp (NASDAQ: BMRC). With 21 offices in San Francisco, Marin, Napa, Sonoma and Alameda counties, Bank of Marin provides business and personal banking, commercial lending, and wealth management services. Specializing in providing legendary service to its customers and investing in its local communities, Bank of Marin has consistently been ranked one of the “Top Corporate Philanthropists" by the San Francisco Business Times and one of the “Best Places to Work” by the North Bay Business Journal. Bank of Marin Bancorp is included in the Russell 2000 Small-Cap Index and has been recognized as a Top 200 Community Bank by US Banker Magazine for the past five years. For more information, visit www.bankofmarin.com.
Forward Looking Statements
This release may contain certain forward-looking statements that are based on management's current expectations regarding economic, legislative, and regulatory issues that may impact Bancorp's earnings in future periods. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. They often include the words “believe,” “expect,” “intend,” “estimate” or words of similar meaning, or future or conditional verbs such as “will,” “would,” “should,” “could” or “may.” Factors that could cause future results to vary materially from current management expectations include, but are not limited to, our ability to integrate the business of NorCal, general economic conditions, economic uncertainty in the United States and abroad, changes in interest rates, deposit flows, real estate values, expected future cash flows on acquired loans, competition, changes in accounting principles, policies or guidelines, legislation or regulation, and other economic, competitive, governmental, regulatory and technological factors affecting Bancorp's operations, pricing, products and services. These and other important factors, including the impact of the NorCal acquisition, are detailed in various securities law filings made periodically by Bancorp, copies of which are available from Bancorp without charge. Bancorp undertakes no obligation to release publicly the result of any revisions to these forward-looking statements that may be made to reflect events or circumstances after the date of this press release or to reflect the occurrence of unanticipated events.
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| BANK OF MARIN BANCORP | |
| FINANCIAL HIGHLIGHTS | |
| June 30, 2014 | |
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| (dollars in thousands, except per share data; unaudited) | | |
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| QUARTER-TO-DATE | June 30, 2014 |
|
| | March 31, 2014 |
| | | June 30, 2013 |
|
| |
| | NET INCOME | $ | 5,168 |
|
| | $ | 4,533 |
| | | $ | 3,055 |
|
| |
| | DILUTED EARNINGS PER COMMON SHARE | $ | 0.86 |
|
| | $ | 0.76 |
| | | $ | 0.55 |
|
| |
| | RETURN ON AVERAGE ASSETS (ROA) | 1.14 |
| % | | 1.01 |
| % | | 0.86 |
| % | |
| | RETURN ON AVERAGE EQUITY (ROE) | 10.96 |
| % | | 9.97 |
| % | | 7.72 |
| % | |
| | EFFICIENCY RATIO | 56.60 |
| % | | 63.86 |
| % | | 64.12 |
| % | |
| | TAX-EQUIVALENT NET INTEREST MARGIN1 | 4.23 |
| % | | 4.25 |
| % | | 4.30 |
| % | |
| | NET CHARGE-OFFS/(RECOVERIES) | $ | (68 | ) |
| | $ | 142 |
| | | $ | 177 |
|
| |
| | NET CHARGE-OFFS/(RECOVERIES) TO AVERAGE LOANS | (0.01 | ) | % | | 0.01 |
| % | | 0.02 |
| % | |
| | | | | | | | | | | |
| YEAR-TO-DATE | | | | | | | | | |
| NET INCOME | $ | 9,701 |
|
| |
|
| | | $ | 7,921 |
|
| |
| DILUTED EARNINGS PER COMMON SHARE | $ | 1.62 |
|
| |
|
| | | $ | 1.44 |
|
| |
| RETURN ON AVERAGE ASSETS (ROA) | 1.08 |
| % | |
|
|
| | 1.12 |
| % | |
| RETURN ON AVERAGE EQUITY (ROE) | 10.47 |
| % | |
|
|
| | 10.19 |
| % | |
| EFFICIENCY RATIO | 60.22 |
| % | |
|
|
| | 60.67 |
| % | |
| TAX-EQUIVALENT NET INTEREST MARGIN1 | 4.24 |
| % | |
|
|
| | 4.39 |
| % | |
| NET CHARGE-OFFS/(RECOVERIES) | $ | 75 |
|
| |
|
| | | $ | 174 |
|
| |
| NET CHARGE-OFFS/(RECOVERIES) TO AVERAGE LOANS | 0.01 |
| % | |
|
|
| | 0.02 |
| % | |
| | | | | | | | | | | |
| AT PERIOD END | | | | | | | | | |
| | TOTAL ASSETS | $ | 1,823,901 |
|
| | $ | 1,797,852 |
| | | $ | 1,428,518 |
|
| |
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| | LOANS: | | | | | | | | | |
| | COMMERCIAL AND INDUSTRIAL | $ | 194,402 |
|
| | $ | 177,995 |
| | | $ | 170,443 |
|
| |
| | REAL ESTATE |
|
|
| | | | | |
| |
| | COMMERCIAL OWNER-OCCUPIED | $ | 233,267 |
|
| | $ | 232,117 |
| | | $ | 206,191 |
|
| |
| | COMMERCIAL INVESTOR-OWNED | $ | 669,225 |
|
| | $ | 640,843 |
| | | $ | 535,260 |
|
| |
| | CONSTRUCTION | $ | 40,197 |
|
| | $ | 32,512 |
| | | $ | 27,728 |
|
| |
| | HOME EQUITY | $ | 106,201 |
|
| | $ | 99,723 |
| | | $ | 90,296 |
|
| |
| | OTHER RESIDENTIAL | $ | 80,399 |
|
| | $ | 78,772 |
| | | $ | 43,290 |
|
| |
| | INSTALLMENT AND OTHER CONSUMER LOANS | $ | 14,820 |
|
| | $ | 16,028 |
| | | $ | 18,274 |
|
| |
| | TOTAL LOANS | $ | 1,338,511 |
|
| | $ | 1,277,990 |
| | | $ | 1,091,482 |
|
| |
| | | | | | | | | | | |
| | NON-PERFORMING LOANS2: |
|
|
| | | | | |
| |
| | COMMERCIAL AND INDUSTRIAL | $ | 335 |
|
| | $ | 154 |
| | | $ | 2,022 |
|
| |
| | REAL ESTATE |
|
|
| | | | | |
| |
| | COMMERCIAL OWNER-OCCUPIED | $ | 1,403 |
|
| | $ | 1,403 |
| | | $ | 1,403 |
|
| |
| | COMMERCIAL INVESTOR-OWNED | $ | 2,618 |
|
| | $ | 2,694 |
| | | $ | 6,024 |
|
| |
| | CONSTRUCTION | $ | 5,197 |
|
| | $ | 4,813 |
| | | $ | 7,046 |
|
| |
| | HOME EQUITY | $ | 444 |
|
| | $ | 228 |
| | | $ | 524 |
|
| |
| | OTHER RESIDENTIAL | $ | — |
|
| | $ | 646 |
| | | $ | 1,148 |
|
| |
| | INSTALLMENT AND OTHER CONSUMER LOANS | $ | 152 |
|
| | $ | 161 |
| | | $ | 321 |
|
| |
| | TOTAL NON-ACCRUAL LOANS | $ | 10,149 |
|
| | $ | 10,099 |
| | | $ | 18,488 |
|
| |
| | | | | | | | | | | |
| | CLASSIFIED LOANS (GRADED SUBSTANDARD & DOUBTFUL) | $ | 33,246 |
| | | $ | 34,285 |
| | | $ | 27,602 |
| | |
| | TOTAL ACCRUING LOANS 30-89 DAYS PAST DUE | $ | 1,471 |
|
| | $ | 2,809 |
| | | $ | 566 |
|
| |
| | LOAN LOSS RESERVE TO LOANS | 1.11 |
| % | | 1.11 |
| % | | 1.32 |
| % | |
| | LOAN LOSS RESERVE TO NON-ACCRUAL LOANS | 1.47 |
| x | | 1.41 |
| x | | 0.78 |
| x | |
| | NON-ACCRUAL LOANS TO TOTAL LOANS | 0.76 |
| % | | 0.79 |
| % | | 1.69 |
| % | |
| | TEXAS RATIO3 | 5.43 |
| % | | 5.57 |
| % | | 10.82 |
| % | |
| | | | | | | | | | | |
| | TOTAL DEPOSITS | $ | 1,598,823 |
|
| | $ | 1,576,340 |
| | | $ | 1,224,437 |
|
| |
| | LOAN TO DEPOSIT RATIO | 83.7 |
| % | | 81.1 |
| % | | 89.1 |
| % | |
| | STOCKHOLDERS' EQUITY | $ | 190,906 |
|
| | $ | 186,165 |
| | | $ | 158,359 |
|
| |
| | BOOK VALUE PER SHARE | $ | 32.29 |
|
| | $ | 31.51 |
| | | $ | 29.10 |
|
| |
| | TANGIBLE COMMON EQUITY TO TANGIBLE ASSETS4 | 9.9 |
| % | | 9.8 |
| % | | 11.1 |
| % | |
| | TOTAL RISK BASED CAPITAL RATIO-BANK5 | 13.0 |
| % | | 13.0 |
| % | | 13.7 |
| % | |
| | TOTAL RISK BASED CAPITAL RATIO-BANCORP5 | 13.5 |
| % | | 13.5 |
| % | | 14.0 |
| % | |
| | FULL TIME EQUIVALENT EMPLOYEES | 263 |
| | | 277 |
| | | 243 |
| | |
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1 Net interest income is annualized by dividing actual number of days in the period times 360 days. |
2 Excludes accruing troubled-debt restructured loans of $14.3 million, $14.5 million and $10.0 million at June 30, 2014, March 31, 2014 and June 30, 2013, respectively. Excludes purchased credit-impaired (PCI) loans with carrying values of $3.8 million, $5.8 million and $2.1 million that were accreting interest at June 30, 2014, March 30, 2014 and June 30, 2013, respectively. These amounts are excluded as PCI loan accretable yield interest recognition is independent from the underlying contractual loan delinquency status. Total PCI loans were $5.2 million, $7.2 million and $3.5 million at June 30, 2014, March 31, 2014 and June 30, 2013. |
3 (Non-performing assets + 90 day delinquent loans)/(tangible common equity + allowance for loan losses). |
4 Tangible common equity to tangible assets is considered to be a meaningful non-GAAP financial measure of capital adequacy and is useful for investors to assess Bancorp's ability to absorb potential losses. Tangible common equity includes common stock, retained earnings and unrealized gain on available for sale securities, net of tax, less goodwill and intangible assets of $10.6 million and $10.7 million at June 30, 2014 and March 31, 2014, respectively. Tangible assets excludes goodwill and intangible assets. |
5 Current period estimated. |
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BANK OF MARIN BANCORP CONSOLIDATED STATEMENTS OF CONDITION |
| at June 30, 2014, March 31, 2013 and June 30, 2013 |
|
| | | | | | | | | | | | |
| (in thousands, except share data; unaudited) | June 30, 2014 | | March 31, 2014 | | June 30, 2013 | |
| Assets | |
| | | | | |
| Cash and due from banks | $ | 81,380 |
| | $ | 91,567 |
| | $ | 32,175 |
| |
| Investment securities | |
| | |
| | | |
| Held-to-maturity, at amortized cost | 123,085 |
| | 132,019 |
| | 131,839 |
| |
| Available-for-sale (at fair value; amortized cost $214,627, $230,067 and $127,989 at June 30, 2014, March 31, 2014 and June 30, 2013, respectively) | 215,873 |
| | 230,337 |
| | 129,562 |
| |
| Total investment securities | 338,958 |
| | 362,356 |
| | 261,401 |
| |
| Loans, net of allowance for loan losses of $14,900, $14,232 and $14,357 at June 30, 2014, March 31, 2014 and June 30, 2013, respectively | 1,323,611 |
| | 1,263,758 |
| | 1,077,125 |
| |
| Bank premises and equipment, net | 9,296 |
| | 9,036 |
| | 9,178 |
| |
| Goodwill | 6,436 |
| | 6,436 |
| | — |
| |
| Core deposit intangible | 4,117 |
| | 4,310 |
| | — |
| |
| Interest receivable and other assets | 60,103 |
| | 60,389 |
| | 48,639 |
| |
| Total assets | $ | 1,823,901 |
| | $ | 1,797,852 |
| | $ | 1,428,518 |
| |
| | | | | | | |
| Liabilities and Stockholders' Equity | |
| | |
| | | |
| Liabilities | |
| | |
| | | |
| Deposits | | | |
| | | |
| Non-interest bearing | $ | 724,975 |
| | $ | 701,561 |
| | $ | 498,572 |
| |
| Interest bearing | | | |
| | | |
| Transaction accounts | 95,052 |
| | 96,550 |
| | 80,221 |
| |
| Savings accounts | 121,890 |
| | 119,361 |
| | 95,317 |
| |
| Money market accounts | 500,720 |
| | 499,909 |
| | 410,676 |
| |
| CDARS® time accounts | — |
| | — |
| | 4,296 |
| |
| Other time accounts | 156,186 |
| | 158,959 |
| | 135,355 |
| |
| Total deposits | 1,598,823 |
| | 1,576,340 |
| | 1,224,437 |
| |
| Federal Home Loan Bank borrowings | 15,000 |
| | 15,000 |
| | 32,200 |
| |
| Subordinated debentures | 5,077 |
| | 5,023 |
| | — |
| |
| Interest payable and other liabilities | 14,095 |
| | 15,324 |
| | 13,522 |
| |
| Total liabilities | 1,632,995 |
| | 1,611,687 |
| | 1,270,159 |
| |
| | | | | | | |
| Stockholders' Equity | |
| | |
| | | |
Preferred stock, no par value,
Authorized - 5,000,000 shares, none issued | — |
|
| — |
|
| — |
| |
Common stock, no par value,
Authorized - 15,000,000 shares;
Issued and outstanding - 5,912,774, 5,906,881
and 5,442,628 at June 30, 2014, March 31, 2014 and
June 30, 2013, respectively | 81,219 |
| | 81,049 |
| | 60,312 |
| |
| Retained earnings | 108,922 |
| | 104,877 |
| | 97,135 |
| |
| Accumulated other comprehensive income, net | 765 |
| | 239 |
| | 912 |
| |
| Total stockholders' equity | 190,906 |
| | 186,165 |
| | 158,359 |
| |
| Total liabilities and stockholders' equity | $ | 1,823,901 |
| | $ | 1,797,852 |
| | $ | 1,428,518 |
| |
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BANK OF MARIN BANCORP CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME |
|
| | | | | | | | | | | | | | | | | | | |
| | Three months ended | | Six months ended |
| (in thousands, except per share amounts; unaudited) | June 30, 2014 | | March 31, 2014 | | June 30, 2013 | | June 30, 2014 | | June 30, 2013 |
| Interest income | | | | | | | | | |
| Interest and fees on loans | $ | 16,363 |
| | $ | 16,319 |
| | $ | 13,366 |
| | $ | 32,682 |
| | $ | 27,001 |
|
| Interest on investment securities |
|
| |
|
| |
|
| | | | |
| Securities of U.S. Government agencies | 1,193 |
| | 1,232 |
| | 585 |
| | 2,425 |
| | 1,210 |
| Obligations of state and political subdivisions | 607 |
| | 634 |
| | 437 |
| | 1,241 |
| | 1,075 |
|
| Corporate debt securities and other | 256 |
| | 268 |
| | 339 |
| | 524 |
| | 663 |
|
| Interest due from banks and other | 37 |
| | 51 |
| | 3 |
| | 88 |
| | 11 |
|
| Total interest income | 18,456 |
| | 18,504 |
| | 14,730 |
| | 36,960 |
| | 29,960 |
|
| Interest expense | |
| | |
| | |
| | |
| | |
|
| Interest on interest bearing transaction accounts | 26 |
| | 23 |
| | 12 |
| | 49 |
| | 23 |
|
| Interest on savings accounts | 11 |
| | 11 |
| | 8 |
| | 22 |
| | 16 |
|
| Interest on money market accounts | 131 |
| | 158 |
| | 95 |
| | 289 |
| | 194 |
|
| Interest on CDARS® time accounts | — |
| | — |
| | 2 |
| | — |
| | 7 |
|
| Interest on other time accounts | 231 |
| | 235 |
| | 224 |
| | 466 |
| | 456 |
|
| Interest on FHLB and overnight borrowings | 78 |
| | 78 |
| | 84 |
| | 156 |
| | 163 |
|
| Interest on subordinated debentures | 105 |
| | 105 |
| | — |
| | 210 |
| | — |
|
| Total interest expense | 582 |
|
| 610 |
|
| 425 |
| | 1,192 |
| | 859 |
|
| Net interest income | 17,874 |
| | 17,894 |
| | 14,305 |
| | 35,768 |
| | 29,101 |
|
| Provision for loan losses | 600 |
| | 150 |
| | 1,100 |
| | 750 |
| | 870 |
|
| Net interest income after provision for loan losses | 17,274 |
| | 17,744 |
| | 13,205 |
| | 35,018 |
| | 28,231 |
|
| Non-interest income | |
| | |
| | |
| | |
| | |
|
| Service charges on deposit accounts | 528 |
| | 556 |
| | 515 |
| | 1,084 |
| | 1,036 |
|
| Wealth Management and Trust Services | 613 |
| | 564 |
| | 539 |
| | 1,177 |
| | 1,086 |
|
| Debit card interchange fees | 360 |
| | 300 |
| | 280 |
| | 660 |
| | 532 |
|
| Merchant interchange fees | 207 |
| | 198 |
| | 222 |
| | 405 |
| | 427 |
|
| Earnings on Bank-owned life Insurance | 211 |
| | 213 |
| | 186 |
| | 424 |
| | 587 |
|
| Gain (loss) on sale of securities | 97 |
| | (8 | ) | | — |
| | 89 |
| | — |
|
| Other income | 352 |
| | 393 |
| | 202 |
| | 745 |
| | 382 |
|
| Total non-interest income | 2,368 |
| | 2,216 |
|
| 1,944 |
| | 4,584 |
| | 4,050 |
|
| Non-interest expense | |
| | |
| | |
| | |
| | |
|
| Salaries and related benefits | 6,232 |
| | 6,930 |
| | 5,430 |
| | 13,162 |
| | 10,728 |
|
| Occupancy and equipment | 1,329 |
| | 1,334 |
| | 1,052 |
| | 2,663 |
| | 2,125 |
|
| Depreciation and amortization | 403 |
| | 416 |
| | 353 |
| | 819 |
| | 689 |
|
| Federal Deposit Insurance Corporation insurance | 269 |
| | 250 |
| | 223 |
| | 519 |
| | 437 |
|
| Data processing | 748 |
| | 1,360 |
| | 696 |
| | 2,108 |
| | 1,245 |
|
| Professional services | 412 |
| | 628 |
| | 814 |
| | 1,040 |
| | 1,341 |
|
| Other expense | 2,064 |
| | 1,925 |
| | 1,851 |
| | 3,989 |
| | 3,549 |
|
| Total non-interest expense | 11,457 |
|
| 12,843 |
|
| 10,419 |
| | 24,300 |
| | 20,114 |
|
| Income before provision for income taxes | 8,185 |
| | 7,117 |
| | 4,730 |
| | 15,302 |
| | 12,167 |
|
| Provision for income taxes | 3,017 |
| | 2,584 |
| | 1,675 |
| | 5,601 |
| | 4,246 |
|
| Net income | $ | 5,168 |
| | $ | 4,533 |
| | $ | 3,055 |
| | $ | 9,701 |
| | $ | 7,921 |
|
| Net income per common share: | |
| | |
| | |
| | | | |
| Basic | $ | 0.88 |
| | $ | 0.77 |
| | $ | 0.56 |
| | $ | 1.65 |
| | $ | 1.47 |
|
| Diluted | $ | 0.86 |
| | $ | 0.76 |
| | $ | 0.55 |
| | $ | 1.62 |
| | $ | 1.44 |
|
| Weighted average shares used to compute net income per common share: |
|
| | | | |
| | | | |
| Basic | 5,888 |
| | 5,870 |
| | 5,419 |
| | 5,879 |
| | 5,404 |
|
| Diluted | 5,993 |
| | 5,980 |
| | 5,509 |
| | 5,987 |
| | 5,498 |
|
| Dividends declared per common share | $ | 0.19 |
| | $ | 0.19 |
| | $ | 0.18 |
| | $ | 0.38 |
| | $ | 0.36 |
|
| Comprehensive income: | | | | | | | | | |
| Net income | $ | 5,168 |
| | $ | 4,533 |
| | $ | 3,055 |
| | $ | 9,701 |
| | $ | 7,921 |
|
| Other comprehensive income (loss) |
|
| | | |
|
| |
|
| |
|
|
Change in net unrealized gain (loss) on available-for-sale securities | 976 |
| | 1,415 |
| | (1,666 | ) | | 2,391 |
| | (1,969 | ) |
Reclassification adjustment for loss on sale of available-for-sale securities included in net income | — |
| | 15 |
| | — |
| | 15 |
| | — |
|
Net change in unrealized gain (loss) on available-for-sale securities, before tax | 976 |
| | 1,430 |
| | (1,666 | ) | | 2,406 |
| | (1,969 | ) |
| Deferred tax expense (benefit) | 450 |
| | 519 |
| | (700 | ) | | 969 |
| | (826 | ) |
| Other comprehensive income (loss), net of tax | 526 |
| | 911 |
| | (966 | ) | | 1,437 |
| | (1,143 | ) |
| Comprehensive income | $ | 5,694 |
| | $ | 5,444 |
| | $ | 2,089 |
| | $ | 11,138 |
| | $ | 6,778 |
|
|
|
| BANK OF MARIN BANCORP |
| AVERAGE STATEMENTS OF CONDITION AND ANALYSIS OF NET INTEREST INCOME |
|
| | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | |
| | | Three months ended | Three months ended | Three months ended |
| | | June 30, 2014 | March 31, 2014 | June 30, 2013 |
| | | | Interest | | | Interest | | | Interest | |
| | | Average | Income/ | Yield/ | Average | Income/ | Yield/ | Average | Income/ | Yield/ |
| (Dollars in thousands; unaudited) | Balance | Expense | Rate | Balance | Expense | Rate | Balance | Expense | Rate |
| Assets | | | | | | | | | |
| | Interest-bearing due from banks 1 | $ | 54,313 |
| $ | 37 |
| 0.27 | % | $ | 85,750 |
| $ | 51 |
| 0.24 | % | $ | 4,485 |
| $ | 3 |
| 0.26 | % |
| | Investment securities 2, 3 | 350,938 |
| 2,208 |
| 2.52 | % | 361,795 |
| 2,293 |
| 2.54 | % | 266,774 |
| 1,452 |
| 2.18 | % |
| | Loans 1, 3, 4 | 1,303,363 |
| 16,597 |
| 5.04 | % | 1,268,841 |
| 16,511 |
| 5.20 | % | 1,070,333 |
| 13,537 |
| 5.00 | % |
| | Total interest-earning assets 1 | 1,708,614 |
| 18,842 |
| 4.36 | % | 1,716,386 |
| 18,855 |
| 4.39 | % | 1,341,592 |
| 14,992 |
| 4.42 | % |
| | Cash and non-interest-bearing due from banks | 41,739 |
| | | 41,793 |
| | | 27,331 |
| | |
| | Bank premises and equipment, net | 9,228 |
| | | 9,088 |
| | | 9,313 |
| | |
| | Interest receivable and other assets, net | 56,954 |
| | | 55,829 |
| | | 38,981 |
| | |
| Total assets | $ | 1,816,535 |
| | | $ | 1,823,096 |
| | | $ | 1,417,217 |
| | |
| Liabilities and Stockholders' Equity | | | | | | | | | |
| | Interest-bearing transaction accounts | $ | 94,358 |
| $ | 26 |
| 0.11 | % | $ | 127,098 |
| $ | 23 |
| 0.07 | % | $ | 83,285 |
| $ | 12 |
| 0.06 | % |
| | Savings accounts | 120,071 |
| 11 |
| 0.04 | % | 121,278 |
| 11 |
| 0.04 | % | 95,083 |
| 8 |
| 0.03 | % |
| | Money market accounts | 504,597 |
| 131 |
| 0.10 | % | 518,930 |
| 158 |
| 0.12 | % | 410,823 |
| 95 |
| 0.09 | % |
| | CDARS® time accounts | — |
| — |
| — | % | 36 |
| — |
| — | % | 5,194 |
| 2 |
| 0.15 | % |
| | Other time accounts | 157,239 |
| 231 |
| 0.59 | % | 160,942 |
| 235 |
| 0.59 | % | 136,759 |
| 224 |
| 0.66 | % |
| | FHLB borrowings 1 | 15,000 |
| 78 |
| 2.07 | % | 15,000 |
| 78 |
| 2.07 | % | 27,785 |
| 84 |
| 1.20 | % |
| | Subordinated debentures 1 | 5,043 |
| 105 |
| 8.24 | % | 4,988 |
| 105 |
| 8.58 | % | — |
| — |
| — | % |
| | Total interest-bearing liabilities | 896,308 |
| 582 |
| 0.26 | % | 948,272 |
| 610 |
| 0.26 | % | 758,929 |
| 425 |
| 0.22 | % |
| | Demand accounts | 716,774 |
| | | 674,689 |
| | | 486,410 |
| | |
| | Interest payable and other liabilities | 14,281 |
| | | 15,748 |
| | | 13,092 |
| | |
| | Stockholders' equity | 189,172 |
| | | 184,387 |
| | | 158,786 |
| | |
| Total liabilities & stockholders' equity | $ | 1,816,535 |
| | | $ | 1,823,096 |
| | | $ | 1,417,217 |
| | |
Tax-equivalent net interest income/margin 1 | | $ | 18,260 |
| 4.23 | % | | $ | 18,244 |
| 4.25 | % | | $ | 14,567 |
| 4.30 | % |
Reported net interest income/margin 1 | | $ | 17,874 |
| 4.14 | % | | $ | 17,894 |
| 4.17 | % | | $ | 14,305 |
| 4.21 | % |
| Tax-equivalent net interest rate spread | |
| 4.10 | % | | | 4.13 | % | | | 4.20 | % |
| | | | | | | | | | | |
| | | Six months ended | Six months ended | |
| | | June 30, 2014 | June 30, 2013 | |
| | |
| Interest |
|
| Interest |
| | | |
| | | Average | Income/ | Yield/ | Average | Income/ | Yield/ | | | |
| (Dollars in thousands; unaudited) | Balance | Expense | Rate | Balance | Expense | Rate | | | |
| Assets | | | | | | | | | |
| | Interest-bearing due from banks 1 | $ | 69,945 |
| $ | 88 |
| 0.25 | % | $ | 5,094 |
| $ | 11 |
| 0.43 | % | | | |
| | Investment securities 2, 3 | 356,336 |
| 4,501 |
| 2.53 | % | 275,553 |
| 3,236 |
| 2.35 | % | | | |
| | Loans 1, 3, 4 | 1,286,197 |
| 33,117 |
| 5.12 | % | 1,066,665 |
| 27,346 |
| 5.10 | % | | | |
| | Total interest-earning assets 1 | 1,712,478 |
| 37,706 |
| 4.38 | % | 1,347,312 |
| 30,593 |
| 4.52 | % |
|
|
|
| |
| | Cash and non-interest-bearing due from banks | 41,766 |
|
|
| 27,788 |
|
|
| | | |
| | Bank premises and equipment, net | 9,158 |
|
|
| 9,369 |
|
|
| | | |
| | Interest receivable and other assets, net | 56,395 |
|
|
| 38,440 |
|
|
| | | |
| Total assets | $ | 1,819,797 |
|
|
| $ | 1,422,909 |
|
|
|
|
| | |
| Liabilities and Stockholders' Equity |
|
|
|
|
|
| | | |
| | Interest-bearing transaction accounts | $ | 110,637 |
| $ | 49 |
| 0.09 | % | $ | 106,205 |
| $ | 23 |
| 0.04 | % | | | |
| | Savings accounts | 120,671 |
| 22 |
| 0.04 | % | 95,818 |
| 16 |
| 0.03 | % | | | |
| | Money market accounts | 511,743 |
| 289 |
| 0.11 | % | 421,430 |
| 194 |
| 0.09 | % | | | |
| | CDARS® time accounts | — |
| — |
| — | % | 9,009 |
| 7 |
| 0.16 | % | | | |
| | Other time accounts | 159,080 |
| 466 |
| 0.59 | % | 138,496 |
| 456 |
| 0.66 | % | | | |
| | FHLB borrowings 1 | 15,000 |
| 156 |
| 2.07 | % | 23,175 |
| 163 |
| 1.40 | % | | | |
| | Subordinated debentures 1 | 5,015 |
| 210 |
| 8.48 | % | — |
| — |
| — | % | | | |
| Total interest-bearing liabilities | 922,146 |
| 1,192 |
| 0.26 | % | 794,133 |
| 859 |
| 0.22 | % | | | |
| Demand accounts | 695,848 |
|
|
| 458,030 |
|
|
| | | |
| Interest payable and other liabilities | 15,010 |
|
|
| 13,987 |
|
|
| | | |
| Stockholders' equity | 186,793 |
|
|
| 156,759 |
|
|
| | | |
| Total liabilities & stockholders' equity | $ | 1,819,797 |
|
|
| $ | 1,422,909 |
|
|
|
|
| | |
Tax-equivalent net interest income/margin 1 |
| $ | 36,514 |
| 4.24 | % |
| $ | 29,734 |
| 4.39 | % | | | |
Reported net interest income/margin 1 |
| $ | 35,768 |
| 4.15 | % |
| $ | 29,101 |
| 4.30 | % | | | |
| Tax-equivalent net interest rate spread |
|
| 4.12 | % |
|
| 4.30 | % | | | |
| | | | | |
| | | | | | | | | | | |
1 Interest income/expense is divided by actual number of days in the period times 360 days to correspond to stated interest rate terms, where applicable. | |
2 Yields on available-for-sale securities are calculated based on amortized cost balances rather than fair value, as changes in fair value are reflected as a component of stockholders' equity. Investment security interest is earned on 30/360 day basis monthly. | |
3 Yields and interest income on tax-exempt securities and loans are presented on a taxable-equivalent basis using the Federal statutory rate of 35 percent. | |
4 Average balances on loans outstanding include non-performing loans. The amortized portion of net loan origination fees is included in interest income on loans, representing an adjustment to the yield. | |
