EXHIBIT 99.1
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FOR IMMEDIATE RELEASE | CONTACT: | Sandy Pfaff |
| | | 415-819-7447 |
| | | sandy@pfaffpr.com |
BANK OF MARIN BANCORP REPORTS QUARTERLY EARNINGS OF $4.3 MILLION
DEPOSIT GROWTH AND LOAN ORIGINATIONS HIGHLIGHT QUARTER
NOVATO, CA, July 20, 2015 - Bank of Marin Bancorp, "Bancorp" (NASDAQ: BMRC), parent company of Bank of Marin, announced earnings of $4.3 million in the second quarter of 2015, compared to $4.5 million in the first quarter of 2015 and $5.2 million in the second quarter of 2014. Diluted earnings per share totaled $0.71 in the second quarter, compared to $0.74 in the prior quarter and $0.86 in the same quarter a year ago. Year-to-date earnings totaled $8.7 million compared to $9.7 million for the same six-month period a year ago. Diluted earnings per share for the six-month period totaled $1.44 compared to $1.62 for the same period in 2014.
“Loan originations were strong for the quarter, especially commercial loans to wine related businesses, and we experienced solid deposit growth in our core market of Marin,” said Russell A. Colombo, President and Chief Executive Officer. "While we experienced significant loan pay-offs, they were driven by positive events for our customers, as commercial real estate continues to attract high prices in the Bay Area. Our relationship banking model allows us to work with these clients, and we expect to finance their other opportunities in the future."
Bancorp also provided the following highlights on its operating and financial performance for the second quarter of 2015:
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| • | Loans totaled $1.34 billion at June 30, 2015, compared to $1.35 billion at March 31, 2015 and $1.34 billion at June 30, 2014. Strong new loan volume of approximately $52 million in the second quarter of 2015 was offset by pay-offs of approximately $55 million, and combined with utilization and amortization on existing loans resulted in a net decrease of $7.3 million since March 31, 2015. The successful completion of several construction projects and the resolution of problem credits contributed to the decline in the quarter. |
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| • | Deposits totaled $1.6 billion at June 30, 2015, and grew $45.4 million over March 31, 2015. Non-interest bearing deposits increased $24.4 million in the second quarter and represent 45.5% of total deposits, compared to 45.2% at March 31, 2015 and 45.3% at June 30, 2014. |
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| • | Credit quality remains strong with non-accrual loans continuing to trend downward, representing 0.53% of total loans at June 30, 2015, down from 0.70% at March 31, 2015 and 0.76% a year ago. Classified loans totaled $27.8 million, down from $34.1 million at the end of the prior quarter and $33.2 million a year ago. Net charge-offs for the second quarter totaled $801 thousand, compared to net recoveries of $57 thousand in the prior quarter and net recoveries of $68 thousand in the same quarter a year ago. No provision for loan losses was recorded in the second quarter of 2015 as the continued reduction in credit risk did not warrant a provision. |
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| • | The total risk-based capital ratio for Bancorp was 14.1% at June 30, 2015 compared to 13.8% at March 31, 2015. The common equity tier one ratio, a regulatory ratio under Basel III (Basel Committee on Bank Supervision guidelines for determining regulatory capital), was 12.8% at June 30, 2015, compared to 12.5% at March 31, 2015. All capital ratios are well above regulatory |
requirements for a well-capitalized institution under the new requirements that took effect January 1, 2015. Tangible common equity to tangible assets totaled 10.6% at June 30, 2015, compared to 10.7% at March 31, 2015 and 9.9% at June 30, 2014.
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| • | On July 17, 2015, the Board of Directors declared a quarterly cash dividend of $0.22 per share. The cash dividend is payable to shareholders of record at the close of business on July 31, 2015 and will be payable on August 7, 2015. |
Loans and Credit Quality
Loans totaled $1.34 billion at June 30, 2015, compared to $1.35 billion at March 31, 2015 and $1.34 billion at June 30, 2014. Non-accrual loans continued to trend downward totaling $7.1 million at June 30, 2015, compared to $9.5 million at March 31, 2015 and $10.1 million a year ago. The decrease in non-accrual loans from the prior quarter and the same quarter a year ago primarily relates to a long-time land development loan that was sold in the second quarter resulting in an $839 thousand charge-off to the allowance for loan losses. Accruing loans past due 30 to 89 days totaled $1.2 million at June 30, 2015, compared to $949 thousand at March 31, 2015 and $1.5 million a year ago.
There was no provision for loan losses recorded in the second quarter of 2015 as the continued reduction in credit risk did not warrant a provision. This compares to no provision in the prior quarter and a provision of $600 thousand in the second quarter of 2014. The ratio of loan loss reserve to loans totaled 1.07% at June 30, 2015, compared to 1.13% at March 31, 2015 and 1.11% at June 30, 2014.
Deposits
Deposits totaled $1.6 billion at June 30, 2015, and grew $45.4 million over March 31, 2015 and $31.7 million over June 30, 2014. Non-interest bearing deposits of $741.1 million at June 30, 2015 increased $24.4 million when compared to March 31, 2015 and $16.1 million when compared to June 30, 2014. While day-to-day deposit volatility continues due to normal seasonal activity and new business ventures by several of our largest business customers, the overall trend is upward in both average and ending balances.
Earnings
“What sets Bank of Marin apart is the quality of our loans and deposits, which we continue to build,” said Tani Girton, Chief Financial Officer. “Our return-on-assets, return-on-equity and loan-to-deposit ratios are all at healthy levels, and we have robust loan and deposit pipelines. Our consistent credit quality, strong liquidity and expense discipline position the Bank to take advantage of growth opportunities.”
Net interest income totaled $16.5 million in the second quarter of 2015, compared to $16.6 million in the prior quarter and $17.9 million in the same quarter a year ago. The tax-equivalent net interest margin was 3.86%, 4.00% and 4.23% for those respective periods. The decrease in tax-equivalent net interest margin from the prior quarter primarily relates to a higher concentration of low yielding cash balances and new loans and securities yielding lower rates. The decrease from the same quarter a year ago primarily relates to lower gains and accretion income related to acquired loans and new loans and securities yielding lower rates.
Loans acquired through the acquisition of other banks are classified as Purchase Credit Impaired ("PCI") or non-PCI loans and are recorded at fair value at acquisition date. For acquired loans not considered credit impaired, the level of accretion varies due to maturities and early pay-offs. 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.
Accretion and gains on pay-offs of purchased loans recorded to interest income were as follows:
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| | Three months ended |
| | June 30, 2015 | | March 31, 2015 | | June 30, 2014 |
| (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 | | $ | 120 |
| | 3 bps | | | $ | 119 |
| | 3 bps | | | $ | 187 |
| | 4 bps |
| Accretion on non-PCI loans | | $ | 465 |
| | 11 bps | | | $ | 371 |
| | 9 bps | | | $ | 713 |
| | 17 bps |
| Gains on pay-offs of PCI loans | | $ | — |
| | 0 bps | | | $ | 43 |
| | 1 bps | | | $ | 622 |
| | 14 bps |
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| | Six months ended | |
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| | June 30, 2015 | | June 30, 2014 | |
| (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 | $ | 239 |
| 3 bps | | $ | 367 |
| 4 bps | |
| Accretion on non-PCI loans | $ | 837 |
| 10 bps | | $ | 2,043 |
| 24 bps | |
| Gains on pay-offs of PCI loans | $ | 43 |
| 0 bps | | $ | 622 |
| 7 bps | |
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Non-interest income in the second quarter of 2015 totaled $2.6 million, compared to $2.2 million in the prior quarter and $2.4 million in the same quarter a year ago. The increase from the prior quarter and same quarter a year ago relates to a $305 thousand special dividend from the Federal Home Loan Bank of San Francisco and a $147 thousand payment from a bankruptcy claim recorded in miscellaneous income. The same increases from the second quarter of 2014 were partially offset by the absence of gains on the sale of investment securities and lower merchant card interchange fees in the second quarter of 2015.
Non-interest expense totaled $12.3 million in the second quarter of 2015, compared to $11.8 million in the prior quarter and $11.5 million in the same quarter a year ago. The increase in non-interest expense from the prior quarter primarily relates to $337 thousand in occupancy and depreciation expense relating to one-time lease accounting adjustments. The increase in non-interest expense from the same quarter a year ago primarily relates to higher personnel expense due to annual merit increases and incentive compensation, and higher occupancy expense as discussed above.
Earnings Call and Webcast Information
Bank of Marin Bancorp will webcast its second quarter earnings call on Monday, July 20, 2015 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” or “Investor Relations.” 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 and trust 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, go to 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, general economic conditions, economic uncertainty in the United States and abroad, changes in interest rates, deposit flows, real estate values, costs or effects of future acquisitions, competition, changes in accounting principles, policies or guidelines, legislation or regulation, and other economic, competitive, governmental, regulatory and technological factors (including external fraud and cyber-security threats) affecting Bancorp's operations, pricing, products and services. These and other important factors, 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, 2015 | |
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| (dollars in thousands, except per share data; unaudited) | | |
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| QUARTER-TO-DATE | June 30, 2015 |
| | March 31, 2015 |
| | | June 30, 2014 |
| |
| | NET INCOME | $ | 4,286 |
|
| | $ | 4,457 |
| | | $ | 5,168 |
|
| |
| | DILUTED EARNINGS PER COMMON SHARE | $ | 0.71 |
|
| | $ | 0.74 |
| | | $ | 0.86 |
|
| |
| | RETURN ON AVERAGE ASSETS (ROA) | 0.93 |
| % | | 1.00 |
| % | | 1.14 |
| % | |
| | RETURN ON AVERAGE EQUITY (ROE) | 8.33 |
| % | | 8.92 |
| % | | 10.96 |
| % | |
| | EFFICIENCY RATIO | 64.62 |
| % | | 63.07 |
| % | | 56.60 |
| % | |
| | TAX-EQUIVALENT NET INTEREST MARGIN1 | 3.86 |
| % | | 4.00 |
| % | | 4.23 |
| % | |
| | NET CHARGE-OFFS/(RECOVERIES) | $ | 801 |
|
| | $ | (57 | ) | | | $ | (68 | ) |
| |
| | NET CHARGE-OFFS/(RECOVERIES) TO AVERAGE LOANS | 0.06 |
| % | | — |
| % | | (0.01 | ) | % | |
| | | | | | | | | | | |
| YEAR-TO-DATE | | | | | | | | | |
| NET INCOME | $ | 8,743 |
|
| |
|
| | | $ | 9,701 |
|
| |
| DILUTED EARNINGS PER COMMON SHARE | $ | 1.44 |
|
| |
|
| | | $ | 1.62 |
|
| |
| RETURN ON AVERAGE ASSETS (ROA) | 0.96 |
| % | |
|
|
| | 1.08 |
| % | |
| RETURN ON AVERAGE EQUITY (ROE) | 8.62 |
| % | |
|
|
| | 10.47 |
| % | |
| EFFICIENCY RATIO | 63.86 |
| % | |
|
|
| | 60.22 |
| % | |
| TAX-EQUIVALENT NET INTEREST MARGIN1 | 3.93 |
| % | |
|
|
| | 4.24 |
| % | |
| NET CHARGE-OFFS/(RECOVERIES) | $ | 744 |
|
| |
|
| | | $ | 75 |
|
| |
| NET CHARGE-OFFS/(RECOVERIES) TO AVERAGE LOANS | 0.06 |
| % | |
|
|
| | 0.01 |
| % | |
| | | | | | | | | | | |
| AT PERIOD END | | | | | | | | | |
| | TOTAL ASSETS | $ | 1,870,762 |
|
| | $ | 1,826,149 |
| | | $ | 1,823,901 |
|
| |
| | | | | | | | | | | |
| | LOANS: | | | | | | | | | |
| | COMMERCIAL AND INDUSTRIAL | $ | 185,020 |
|
| | $ | 196,442 |
| | | $ | 194,402 |
|
| |
| | REAL ESTATE |
|
|
| | | | | |
| |
| | COMMERCIAL OWNER-OCCUPIED | $ | 235,121 |
|
| | $ | 235,337 |
| | | $ | 233,267 |
|
| |
| | COMMERCIAL INVESTOR-OWNED | $ | 663,357 |
|
| | $ | 653,848 |
| | | $ | 669,225 |
|
| |
| | CONSTRUCTION | $ | 48,754 |
|
| | $ | 57,050 |
| | | $ | 40,197 |
|
| |
| | HOME EQUITY | $ | 115,493 |
|
| | $ | 113,277 |
| | | $ | 106,201 |
|
| |
| | OTHER RESIDENTIAL | $ | 73,721 |
|
| | $ | 73,375 |
| | | $ | 80,399 |
|
| |
| | INSTALLMENT AND OTHER CONSUMER LOANS | $ | 17,739 |
|
| | $ | 17,155 |
| | | $ | 14,820 |
|
| |
| | TOTAL LOANS | $ | 1,339,205 |
|
| | $ | 1,346,484 |
| | | $ | 1,338,511 |
|
| |
| | | | | | | | | | | |
| | NON-PERFORMING LOANS2: |
|
|
| | | | | |
| |
| | COMMERCIAL AND INDUSTRIAL | $ | 347 |
|
| | $ | 373 |
| | | $ | 335 |
|
| |
| | REAL ESTATE |
|
|
| | | | | |
| |
| | COMMERCIAL OWNER-OCCUPIED | $ | 1,403 |
|
| | $ | 1,403 |
| | | $ | 1,403 |
|
| |
| | COMMERCIAL INVESTOR-OWNED | $ | 2,278 |
|
| | $ | 2,354 |
| | | $ | 2,618 |
|
| |
| | CONSTRUCTION | $ | 2,733 |
|
| | $ | 5,107 |
| | | $ | 5,197 |
|
| |
| | HOME EQUITY | $ | 265 |
|
| | $ | 166 |
| | | $ | 444 |
|
| |
| | OTHER RESIDENTIAL | $ | — |
|
| | $ | — |
| | | $ | — |
|
| |
| | INSTALLMENT AND OTHER CONSUMER LOANS | $ | 42 |
|
| | $ | 79 |
| | | $ | 152 |
|
| |
| | TOTAL NON-ACCRUAL LOANS | $ | 7,068 |
|
| | $ | 9,482 |
| | | $ | 10,149 |
|
| |
| | | | | | | | | | | |
| | CLASSIFIED LOANS (GRADED SUBSTANDARD & DOUBTFUL) | $ | 27,806 |
| | | $ | 34,129 |
| | | $ | 33,246 |
| | |
| | TOTAL ACCRUING LOANS 30-89 DAYS PAST DUE | $ | 1,151 |
|
| | $ | 949 |
| | | $ | 1,471 |
|
| |
| | LOAN LOSS RESERVE TO LOANS | 1.07 |
| % | | 1.13 |
| % | | 1.11 |
| % | |
| | LOAN LOSS RESERVE TO NON-ACCRUAL LOANS | 2.03 |
| x | | 1.60 |
| x | | 1.47 |
| x | |
| | NON-ACCRUAL LOANS TO TOTAL LOANS | 0.53 |
| % | | 0.70 |
| % | | 0.76 |
| % | |
| | TEXAS RATIO3 | 3.54 |
| % | | 4.71 |
| % | | 5.43 |
| % | |
| | | | | | | | | | | |
| | TOTAL DEPOSITS | $ | 1,630,483 |
|
| | $ | 1,585,120 |
| | | $ | 1,598,823 |
|
| |
| | LOAN-TO-DEPOSIT RATIO | 82.1 |
| % | | 84.9 |
| % | | 83.7 |
| % | |
| | STOCKHOLDERS' EQUITY | $ | 207,182 |
|
| | $ | 204,506 |
| | | $ | 190,906 |
|
| |
| | BOOK VALUE PER SHARE | $ | 34.63 |
|
| | $ | 34.27 |
| | | $ | 32.29 |
|
| |
| | TANGIBLE COMMON EQUITY TO TANGIBLE ASSETS4 | 10.6 |
| % | | 10.7 |
| % | | 9.9 |
| % | |
| | TOTAL RISK-BASED CAPITAL RATIO-BANK5 | 13.8 |
| % | | 13.5 |
| % | | 13.0 |
| % | |
| | TOTAL RISK-BASED CAPITAL RATIO-BANCORP5 | 14.1 |
| % | | 13.8 |
| % | | 13.5 |
| % | |
| | FULL-TIME EQUIVALENT EMPLOYEES | 261 |
| | | 267 |
| | | 263 |
| | |
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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 $16.1 million, $15.6 million and $14.3 million at June 30, 2015, March 31, 2015 and June 30, 2014, respectively. Excludes purchased credit-impaired (PCI) loans with carrying values of $3.7 million, $3.7 million and $3.8 million that were accreting interest at June 30, 2015, March 31, 2015 and June 30, 2014, 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 $5.1 million, $5.1 million and $5.2 million at June 30, 2015, March 31, 2015 and June 30, 2014. |
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 $9.9 million, $10.0 million and $10.6 million at June 30, 2015, March 31, 2015 and June 30, 2014, respectively. Tangible assets exclude goodwill and intangible assets. |
5 Current period estimated. |
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BANK OF MARIN BANCORP CONSOLIDATED STATEMENTS OF CONDITION |
| at June 30, 2015, March 31, 2015 and June 30, 2014 |
|
| | | | | | | | | | | |
| (in thousands, except share data; unaudited) | June 30, 2015 | | March 31, 2015 | | June 30, 2014 |
| Assets | |
| | | | |
| Cash and due from banks | $ | 117,533 |
| | $ | 103,164 |
| | $ | 81,380 |
|
| Investment securities | |
| | |
| | |
| Held-to-maturity, at amortized cost | 94,475 |
| | 107,476 |
| | 123,085 |
|
| Available-for-sale (at fair value; amortized cost $252,709, $201,568, and $214,627 at June 30, 2015, March 31, 2015 and June 30, 2014, respectively) | 254,018 |
| | 204,680 |
| | 215,873 |
|
| Total investment securities | 348,493 |
| | 312,156 |
| | 338,958 |
|
| Loans, net of allowance for loan losses of $14,355, $15,156 and $14,900 at June 30, 2015, March 31, 2015 and June 30, 2014, respectively | 1,324,851 |
| | 1,331,328 |
| | 1,323,611 |
|
| Bank premises and equipment, net | 9,673 |
| | 9,852 |
| | 9,296 |
|
| Goodwill | 6,436 |
| | 6,436 |
| | 6,436 |
|
| Core deposit intangible | 3,423 |
| | 3,577 |
| | 4,117 |
|
| Interest receivable and other assets | 60,353 |
| | 59,636 |
| | 60,103 |
|
| Total assets | $ | 1,870,762 |
| | $ | 1,826,149 |
| | $ | 1,823,901 |
|
| | | | | | |
| Liabilities and Stockholders' Equity | |
| | |
| | |
| Liabilities | |
| | |
| | |
| Deposits | | | |
| | |
| Non-interest bearing | $ | 741,107 |
| | $ | 716,719 |
| | $ | 724,975 |
|
| Interest bearing | | | |
| | |
| Transaction accounts | 95,622 |
| | 95,439 |
| | 95,052 |
|
| Savings accounts | 132,377 |
| | 133,792 |
| | 121,890 |
|
| Money market accounts | 502,263 |
| | 478,145 |
| | 500,720 |
|
| Time accounts | 159,114 |
| | 161,025 |
| | 156,186 |
|
| Total deposits | 1,630,483 |
| | 1,585,120 |
| | 1,598,823 |
|
| Federal Home Loan Bank ("FHLB") borrowings | 15,000 |
| | 15,000 |
| | 15,000 |
|
| Subordinated debentures | 5,291 |
| | 5,238 |
| | 5,077 |
|
| Interest payable and other liabilities | 12,806 |
| | 16,285 |
| | 14,095 |
|
| Total liabilities | 1,663,580 |
| | 1,621,643 |
| | 1,632,995 |
|
| | | | | | |
| 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 - 5,983,551, 5,967,614
and 5,912,774 at June 30, 2015, March 31, 2015 and
June 30, 2014, respectively | 83,826 |
| | 83,011 |
| | 81,219 |
|
| Retained earnings | 122,625 |
| | 119,652 |
| | 108,922 |
|
| Accumulated other comprehensive income, net | 731 |
| | 1,843 |
| | 765 |
|
| Total stockholders' equity | 207,182 |
| | 204,506 |
| | 190,906 |
|
| Total liabilities and stockholders' equity | $ | 1,870,762 |
| | $ | 1,826,149 |
| | $ | 1,823,901 |
|
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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, 2015 | | March 31, 2015 | | June 30, 2014 | | June 30, 2015 | | June 30, 2014 |
| Interest income | | | | | | | | | |
| Interest and fees on loans | $ | 15,287 |
| | $ | 15,379 |
| | $ | 16,363 |
| | $ | 30,666 |
| | $ | 32,682 |
|
| Interest on investment securities |
|
| |
|
| |
|
| | | | |
| Securities of U.S. government agencies | 990 |
| | 1,035 |
| | 1,193 |
| | 2,025 |
| | 2,425 |
| Obligations of state and political subdivisions | 511 |
| | 540 |
| | 607 |
| | 1,051 |
| | 1,241 |
|
| Corporate debt securities and other | 179 |
| | 205 |
| | 256 |
| | 384 |
| | 524 |
|
| Interest on Federal funds sold and due from banks | 51 |
| | 21 |
| | 37 |
| | 72 |
| | 88 |
|
| Total interest income | 17,018 |
| | 17,180 |
| | 18,456 |
| | 34,198 |
| | 36,960 |
|
| Interest expense | |
| | |
| | |
| | |
| | |
|
| Interest on interest-bearing transaction accounts | 30 |
| | 30 |
| | 26 |
| | 60 |
| | 49 |
|
| Interest on savings accounts | 13 |
| | 12 |
| | 11 |
| | 25 |
| | 22 |
|
| Interest on money market accounts | 123 |
| | 127 |
| | 131 |
| | 250 |
| | 289 |
|
| Interest on time accounts | 215 |
| | 231 |
| | 231 |
| | 437 |
| | 466 |
|
| Interest on FHLB and overnight borrowings | 78 |
| | 78 |
| | 78 |
| | 156 |
| | 156 |
|
| Interest on subordinated debentures | 105 |
| | 104 |
| | 105 |
| | 209 |
| | 210 |
|
| Total interest expense | 564 |
|
| 582 |
|
| 582 |
| | 1,137 |
| | 1,192 |
|
| Net interest income | 16,454 |
| | 16,598 |
| | 17,874 |
| | 33,061 |
| | 35,768 |
|
| Provision for loan losses | — |
| | — |
| | 600 |
| | — |
| | 750 |
|
| Net interest income after provision for loan losses | 16,454 |
| | 16,598 |
| | 17,274 |
| | 33,061 |
| | 35,018 |
|
| Non-interest income | |
| | |
| | |
| | |
| | |
|
| Service charges on deposit accounts | 504 |
| | 525 |
| | 528 |
| | 1,029 |
| | 1,084 |
|
| Wealth Management and Trust Services | 603 |
| | 638 |
| | 613 |
| | 1,241 |
| | 1,177 |
|
| Debit card interchange fees | 368 |
| | 347 |
| | 360 |
| | 715 |
| | 660 |
|
| Merchant interchange fees | 129 |
| | 130 |
| | 207 |
| | 259 |
| | 405 |
|
| Earnings on bank-owned life insurance | 203 |
| | 203 |
| | 211 |
| | 406 |
| | 424 |
|
| Dividends on FHLB stock | 461 |
| | 148 |
| | 130 |
| | 608 |
| | 260 |
|
| Gain on sale of securities | — |
| | 8 |
| | 97 |
| | 8 |
| | 89 |
|
| Other income | 340 |
| | 190 |
| | 222 |
| | 531 |
| | 485 |
|
| Total non-interest income | 2,608 |
| | 2,189 |
|
| 2,368 |
| | 4,797 |
| | 4,584 |
|
| Non-interest expense | |
| | |
| | |
| | |
| | |
|
| Salaries and related benefits | 6,672 |
| | 6,790 |
| | 6,232 |
| | 13,462 |
| | 13,162 |
|
| Occupancy and equipment | 1,493 |
| | 1,342 |
| | 1,329 |
| | 2,835 |
| | 2,663 |
|
| Depreciation and amortization | 650 |
| | 421 |
| | 403 |
| | 1,071 |
| | 819 |
|
| Federal Deposit Insurance Corporation insurance | 253 |
| | 236 |
| | 269 |
| | 489 |
| | 519 |
|
| Data processing | 792 |
| | 786 |
| | 748 |
| | 1,578 |
| | 2,108 |
|
| Professional services | 515 |
| | 564 |
| | 412 |
| | 1,079 |
| | 1,040 |
|
| Directors' expense | 247 |
| | 191 |
| | 157 |
| | 438 |
| | 312 |
|
| Information technology | 216 |
| | 152 |
| | 173 |
| | 368 |
| | 338 |
|
| Reversal of losses on off-balance sheet commitments | (109 | ) | | (201 | ) | | (15 | ) | | (310 | ) | | (15 | ) |
| Other expense | 1,590 |
| | 1,567 |
| | 1,749 |
| | 3,166 |
| | 3,354 |
|
| Total non-interest expense | 12,319 |
|
| 11,848 |
|
| 11,457 |
| | 24,176 |
| | 24,300 |
|
| Income before provision for income taxes | 6,743 |
| | 6,939 |
| | 8,185 |
| | 13,682 |
| | 15,302 |
|
| Provision for income taxes | 2,457 |
| | 2,482 |
| | 3,017 |
| | 4,939 |
| | 5,601 |
|
| Net income | $ | 4,286 |
| | $ | 4,457 |
| | $ | 5,168 |
| | $ | 8,743 |
| | $ | 9,701 |
|
| Net income per common share: | |
| | |
| | |
| | | | |
| Basic | $ | 0.72 |
| | $ | 0.75 |
| | $ | 0.88 |
| | $ | 1.47 |
| | $ | 1.65 |
|
| Diluted | $ | 0.71 |
| | $ | 0.74 |
| | $ | 0.86 |
| | $ | 1.44 |
| | $ | 1.62 |
|
| Weighted average shares used to compute net income per common share: |
|
| | | | |
| | | | |
| Basic | 5,945 |
| | 5,921 |
| | 5,888 |
| | 5,933 |
| | 5,879 |
|
| Diluted | 6,062 |
| | 6,048 |
| | 5,993 |
| | 6,055 |
| | 5,987 |
|
| Dividends declared per common share | $ | 0.22 |
| | $ | 0.22 |
| | $ | 0.19 |
| | $ | 0.44 |
| | $ | 0.38 |
|
| Comprehensive income: | | | | | | | | | |
| Net income | $ | 4,286 |
| | $ | 4,457 |
| | $ | 5,168 |
| | $ | 8,743 |
| | $ | 9,701 |
|
| Other comprehensive income |
|
| | | |
|
| |
|
| |
|
|
Change in net unrealized (loss) gain on available-for- sale securities | (1,803 | ) | | 1,317 |
| | 976 |
| | (486 | ) | | 2,391 |
|
Reclassification adjustment for (gain) loss on available- for-sale securities included in net income | — |
| | (8 | ) | | — |
| | (8 | ) | | 15 |
|
Net change in unrealized (loss) gain on available-for- sale securities, before tax | (1,803 | ) | | 1,309 |
| | 976 |
| | (494 | ) | | 2,406 |
|
| Deferred tax (benefit) expense | (691 | ) | | 554 |
| | 450 |
| | (137 | ) | | 969 |
|
| Other comprehensive (loss) income, net of tax | (1,112 | ) | | 755 |
| | 526 |
| | (357 | ) | | 1,437 |
|
| Comprehensive income | $ | 3,174 |
| | $ | 5,212 |
| | $ | 5,694 |
| | $ | 8,386 |
| | $ | 11,138 |
|
|
|
| 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, 2015 | March 31, 2015 | June 30, 2014 |
| | | | 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 | $ | 76,710 |
| $ | 52 |
| 0.27 | % | $ | 38,295 |
| $ | 21 |
| 0.22 | % | $ | 54,313 |
| $ | 37 |
| 0.27 | % |
| | Investment securities 2, 3 | 319,032 |
| 1,842 |
| 2.31 | % | 311,978 |
| 1,927 |
| 2.47 | % | 350,938 |
| 2,208 |
| 2.52 | % |
| | Loans 1, 3, 4 | 1,336,249 |
| 15,587 |
| 4.61 | % | 1,351,791 |
| 15,675 |
| 4.64 | % | 1,303,363 |
| 16,597 |
| 5.04 | % |
| | Total interest-earning assets 1 | 1,731,991 |
| 17,481 |
| 3.99 | % | 1,702,064 |
| 17,623 |
| 4.14 | % | 1,708,614 |
| 18,842 |
| 4.36 | % |
| | Cash and non-interest-bearing due from banks | 48,955 |
| | | 41,073 |
| | | 41,739 |
| | |
| | Bank premises and equipment, net | 9,841 |
| | | 9,839 |
| | | 9,228 |
| | |
| | Interest receivable and other assets, net | 58,744 |
| | | 58,132 |
| | | 56,954 |
| | |
| Total assets | $ | 1,849,531 |
| | | $ | 1,811,108 |
| | | $ | 1,816,535 |
| | |
| Liabilities and Stockholders' Equity | | | | | | | | | |
| | Interest-bearing transaction accounts | $ | 94,960 |
| $ | 30 |
| 0.13 | % | $ | 92,376 |
| $ | 30 |
| 0.13 | % | $ | 94,358 |
| $ | 26 |
| 0.11 | % |
| | Savings accounts | 131,564 |
| 12 |
| 0.04 | % | 133,877 |
| 12 |
| 0.04 | % | 120,071 |
| 11 |
| 0.04 | % |
| | Money market accounts | 488,422 |
| 123 |
| 0.10 | % | 486,830 |
| 127 |
| 0.11 | % | 504,597 |
| 131 |
| 0.10 | % |
| | Time accounts | 157,982 |
| 215 |
| 0.55 | % | 154,118 |
| 231 |
| 0.61 | % | 157,239 |
| 231 |
| 0.59 | % |
| | FHLB borrowing and overnight borrowings1 | 15,000 |
| 79 |
| 2.07 | % | 15,397 |
| 78 |
| 2.07 | % | 15,000 |
| 78 |
| 2.07 | % |
| | Subordinated debentures 1 | 5,259 |
| 105 |
| 7.90 | % | 5,207 |
| 104 |
| 7.99 | % | 5,043 |
| 105 |
| 8.24 | % |
| | Total interest-bearing liabilities | 893,187 |
| 564 |
| 0.25 | % | 887,805 |
| 582 |
| 0.27 | % | 896,308 |
| 582 |
| 0.26 | % |
| | Demand accounts | 735,481 |
| | | 705,024 |
| | | 716,774 |
| | |
| | Interest payable and other liabilities | 14,358 |
| | | 15,594 |
| | | 14,281 |
| | |
| | Stockholders' equity | 206,505 |
| | | 202,685 |
| | | 189,172 |
| | |
| Total liabilities & stockholders' equity | $ | 1,849,531 |
| | | $ | 1,811,108 |
| | | $ | 1,816,535 |
| | |
Tax-equivalent net interest income/margin 1 | | $ | 16,917 |
| 3.86 | % | | $ | 17,041 |
| 4.00 | % | | $ | 18,260 |
| 4.23 | % |
Reported net interest income/margin 1 | | $ | 16,454 |
| 3.76 | % | | $ | 16,598 |
| 3.90 | % | | $ | 17,874 |
| 4.14 | % |
| Tax-equivalent net interest rate spread | |
| 3.74 | % | | | 3.88 | % | | | 4.10 | % |
| | | | | | | | | | | |
| | | Six months ended | Six months ended | |
| | | June 30, 2015 | June 30, 2014 | |
| | |
| 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 | $ | 57,608 |
| $ | 72 |
| 0.25 | % | $ | 69,945 |
| $ | 88 |
| 0.25 | % | | | |
| | Investment securities 2, 3 | 315,525 |
| 3,770 |
| 2.39 | % | 356,336 |
| 4,501 |
| 2.53 | % | | | |
| | Loans 1, 3, 4 | 1,343,977 |
| 31,263 |
| 4.63 | % | 1,286,197 |
| 33,117 |
| 5.12 | % | | | |
| | Total interest-earning assets 1 | 1,717,110 |
| 35,105 |
| 4.07 | % | 1,712,478 |
| 37,706 |
| 4.38 | % |
|
|
|
| |
| | Cash and non-interest-bearing due from banks | 45,036 |
|
|
| 41,766 |
|
|
| | | |
| | Bank premises and equipment, net | 9,840 |
|
|
| 9,158 |
|
|
| | | |
| | Interest receivable and other assets, net | 58,440 |
|
|
| 56,395 |
|
|
| | | |
| Total assets | $ | 1,830,426 |
|
|
| $ | 1,819,797 |
|
|
|
|
| | |
| Liabilities and Stockholders' Equity |
|
|
|
|
|
| | | |
| | Interest-bearing transaction accounts | $ | 93,676 |
| $ | 60 |
| 0.13 | % | $ | 110,637 |
| $ | 49 |
| 0.09 | % | | | |
| | Savings accounts | 132,714 |
| 25 |
| 0.04 | % | 120,671 |
| 22 |
| 0.04 | % | | | |
| | Money market accounts | 487,630 |
| 250 |
| 0.10 | % | 511,743 |
| 289 |
| 0.11 | % | | | |
| | Time accounts | 156,055 |
| 437 |
| 0.56 | % | 159,080 |
| 466 |
| 0.59 | % | | | |
| | FHLB borrowing and overnight borrowings1 | 15,197 |
| 156 |
| 2.07 | % | 15,000 |
| 156 |
| 2.07 | % | | | |
| | Subordinated debentures 1 | 5,233 |
| 209 |
| 8.05 | % | 5,015 |
| 210 |
| 8.48 | % | | | |
| Total interest-bearing liabilities | 890,505 |
| 1,137 |
| 0.26 | % | 922,146 |
| 1,192 |
| 0.26 | % | | | |
| Demand accounts | 720,342 |
|
|
| 695,848 |
|
|
| | | |
| Interest payable and other liabilities | 14,973 |
|
|
| 15,010 |
|
|
| | | |
| Stockholders' equity | 204,606 |
|
|
| 186,793 |
|
|
| | | |
| Total liabilities & stockholders' equity | $ | 1,830,426 |
|
|
| $ | 1,819,797 |
|
|
|
|
| | |
Tax-equivalent net interest income/margin 1 |
| $ | 33,968 |
| 3.93 | % |
| $ | 36,514 |
| 4.24 | % | | | |
Reported net interest income/margin 1 |
| $ | 33,061 |
| 3.83 | % |
| $ | 35,768 |
| 4.15 | % | | | |
| Tax-equivalent net interest rate spread |
|
| 3.81 | % |
|
| 4.12 | % | | | |
| | | | | |
| | | | | | | | | | | |
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. |
