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 $4.8 MILLION
NOVATO, CA, October 16, 2015 - Bank of Marin Bancorp, "Bancorp" (NASDAQ: BMRC), parent company of Bank of Marin, announced earnings of $4.8 million in the third quarter of 2015, compared to $4.3 million in the second quarter of 2015 and $5.4 million in the third quarter of 2014. Diluted earnings per share totaled $0.79 in the third quarter, compared to $0.71 in the prior quarter and $0.89 in the same quarter a year ago. Year-to-date earnings totaled $13.5 million compared to $15.1 million for the same nine-month period a year ago. Year-to-date diluted earnings per share totaled $2.23 compared to $2.51 for the same period in 2014.
“Loan originations continued to trend up for the third straight quarter. That combined with the lowest quarterly loan payoffs so far this year resulted in strong net loan growth for the quarter," said Russell A. Colombo, President and Chief Executive Officer.
Bancorp also provided the following highlights on its operating and financial performance for the third quarter of 2015:
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| • | Loans totaled $1,363.2 million at September 30, 2015, compared to $1,339.2 million at June 30, 2015 and $1,361.0 million at September 30, 2014. The third quarter was highlighted by strong loan volume of approximately $57 million. Although payoffs offset some of the new volume, net loans grew by $24.0 million in the quarter, including utilization and amortization on existing loans. Loan payoffs were distributed among all loan types. Less than 10% were loans lost to competition. |
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| • | Credit quality continues to improve with non-accrual loans trending downward, representing 0.19% of total loans at September 30, 2015, down from 0.53% at June 30, 2015 and 0.73% a year ago. The Texas ratio was 1.41% at September 30, 2015, down from 3.54% at the end of the prior quarter, and 5.14% a year ago. Classified loans totaled $24.0 million, down from $27.8 million at the end of the prior quarter and $39.0 million a year ago. No provision for loan losses was recorded in the third quarter of 2015 as the continued improvement in credit quality reinforced the adequacy of the existing loan loss reserve. |
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| • | The total risk-based capital ratio for Bancorp was 14.0% at September 30, 2015 compared to 14.1% at June 30, 2015. The common equity tier one ratio, a regulatory ratio under Basel III (Basel Committee on Bank Supervision guidelines for determining regulatory capital), was 12.7% at September 30, 2015, compared to 12.8% at June 30, 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 10.8% at September 30, 2015, compared to 10.6% at June 30, 2015 and 10.3% at September 30, 2014. |
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| • | The cashless exercise of a warrant to purchase common stock at a per share exercise price of $26.63 in September 2015 resulted in a net increase of 70,591 shares of outstanding common stock. The warrant was issued to the U.S. Treasury under the United States Department of the Treasury Capital Purchase Program (the “TCPP”) in 2008 and was subsequently auctioned to two institutional investors. |
Loans and Credit Quality
Loans totaled $1,363.2 million at September 30, 2015, compared to $1,339.2 million at June 30, 2015 and $1,361.0 million at September 30, 2014. There was good distribution of loan volume during the quarter across our entire footprint. Commercial real estate and commercial and industrial (and related owner-occupied commercial real estate) accounted for the vast majority of new loan volume.
Non-accrual loans totaled $2.6 million at September 30, 2015, down from $7.1 million at June 30, 2015 and $9.8 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 $2.7 million loan that was returned to accrual status and the payoff of a $1.4 million loan. Accruing loans past due 30 to 89 days totaled $3.4 million at September 30, 2015, compared to $1.2 million at June 30, 2015 and $299 thousand a year ago. The increase in past due loans is primarily due to five loans totaling $1.2 million, which paid off subsequent to quarter end.
There was no provision for loan losses recorded in the third quarter of 2015, consistent with the prior quarter and the same quarter a year ago, as the existing level of loan loss reserve and continued improvement in credit quality did not warrant a provision. The ratio of loan loss reserve to loans totaled 1.06% at September 30, 2015, compared to 1.07% at June 30, 2015 and 1.11% at September 30, 2014.
Investments
The investment portfolio grew $71.8 million to $420.3 million at September 30, 2015 from June 30, 2015, as excess cash and new deposits were deployed into short duration high quality securities and municipal bonds.
Deposits
Deposits totaled $1,635.5 million at September 30, 2015, and grew $5.0 million over June 30, 2015 and $63.9 million over September 30, 2014. Non-interest bearing deposits increased to $752.3 million, or 46.0% of total deposits, compared to 45.5% at June 30, 2015 and 45.7% at September 30, 2014.
Earnings
"The high quality of the Bank's loan and deposit relationships and credit portfolio is reflected in our consistent performance," said Tani Girton, Chief Financial Officer. "Our 1.0% return on assets and 9.0% return on equity are supported by robust capital and liquidity as well as disciplined expense management."
Net interest income totaled $16.9 million in the third quarter of 2015, compared to $16.5 million in the prior quarter and $17.5 million in the same quarter a year ago. The increase from the prior quarter primarily relates to higher investment security and loan balances, as well as an additional day in the third quarter, partially offset by lower yields on loans and securities. The decrease from the same quarter a year ago relates to lower accretion income on acquired loans and new securities and loans yielding lower rates, partially offset by higher securities balances.
The tax-equivalent net interest margin was 3.79% in the third quarter of 2015, compared to 3.86% in the prior quarter and 4.03% in the same quarter a year ago. The decrease in tax-equivalent net interest margin from the prior quarter and the same quarter a year ago primarily relates to a higher percentage of securities on the balance sheet as average deposit levels outpaced loan growth. Additionally, income recognition on acquired loans continues to fall and interest rates on new loans are somewhat lower than the rates on loans that have paid off.
Loans acquired through the acquisition of other banks are classified as Purchased 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 payoffs. Accretion on PCI loans fluctuates based on changes in cash flows expected to be collected. Gains on payoffs of PCI loans are recorded as interest income when the payoff amounts exceed the recorded investment. PCI loans totaled $3.7 million, $5.1 million, and $5.2 million at September 30, 2015, June 30, 2015 and September 30, 2014, respectively.
Accretion and gains on payoffs of purchased loans recorded to interest income were as follows:
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| | Three months ended |
| | September 30, 2015 | | June 30, 2015 | | September 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 | | $ | 128 |
| | 3 bps | | | $ | 120 |
| | 3 bps | | | $ | 126 |
| | 3 bps |
| Accretion on non-PCI loans | | $ | 366 |
| | 8 bps | | | $ | 465 |
| | 11 bps | | | $ | 774 |
| | 17 bps |
| Gains on payoffs of PCI loans | | $ | 1 |
| | 0 bps | | | $ | — |
| | 0 bps | | | $ | — |
| | 0 bps |
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| | Nine months ended | |
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| | September 30, 2015 | | September 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 | $ | 367 |
| 3 bps | | $ | 494 |
| 4 bps | |
| Accretion on non-PCI loans | $ | 1,202 |
| 9 bps | | $ | 2,817 |
| 22 bps | |
| Gains on payoffs of PCI loans | $ | 44 |
| 0 bps | | $ | 622 |
| 5 bps | |
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Non-interest income in the third quarter of 2015 totaled $2.3 million, compared to $2.6 million in the prior quarter and $2.3 million in the same quarter a year ago. Non-interest income decreased compared to the prior quarter as the second quarter included 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 decrease is partially offset by a $72 thousand gain on the sale of four investment securities in the third quarter of 2015.
Non-interest expense totaled $11.6 million in the third quarter of 2015, compared to $12.3 million in the prior quarter and $11.4 million in the same quarter a year ago. Several non-interest expense items decreased from the prior quarter including personnel expense by $372 thousand and one-time lease accounting adjustments of $337 thousand recorded in the second quarter of 2015. Reductions were partially offset by a $324 thousand provision for losses on off-balance sheet commitments due to an increase in available commitments in the third quarter of 2015, compared to a $109 thousand reversal in the second quarter related to the reduced effect of historical charge-offs. The increase in non-interest expense from the same quarter a year ago primarily relates to the provision for losses on off-balance sheet commitments recorded in the third quarter of 2015.
Earnings Call and Webcast Information
Bank of Marin Bancorp will webcast its third quarter earnings call on Friday, October 16, 2015 at 10:30 a.m. PT/ 1:30 p.m. ET. Investors will have the opportunity to listen to the conference call online through Bank of Marin’s website at http://www.bankofmarin.com on the “Investor Relations” page. 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 $1.9 billion. Founded in 1989 and headquartered in Novato, Bank of Marin is the sole subsidiary of Bank of Marin Bancorp (NASDAQ: BMRC). With 20 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 | |
| September 30, 2015 | |
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| (dollars in thousands, except per share data; unaudited) | | |
| | | | | | | | | | | |
| QUARTER-TO-DATE | September 30, 2015 |
| | June 30, 2015 |
| | | September 30, 2014 |
| |
| | NET INCOME | $ | 4,773 |
|
| | $ | 4,286 |
| | | $ | 5,378 |
|
| |
| | DILUTED EARNINGS PER COMMON SHARE | $ | 0.79 |
|
| | $ | 0.71 |
| | | $ | 0.89 |
|
| |
| | RETURN ON AVERAGE ASSETS (ROA) | 1.00 |
| % | | 0.93 |
| % | | 1.15 |
| % | |
| | RETURN ON AVERAGE EQUITY (ROE) | 9.00 |
| % | | 8.33 |
| % | | 10.98 |
| % | |
| | EFFICIENCY RATIO | 60.67 |
| % | | 64.62 |
| % | | 57.23 |
| % | |
| | TAX-EQUIVALENT NET INTEREST MARGIN1 | 3.79 |
| % | | 3.86 |
| % | | 4.03 |
| % | |
| | NET CHARGE-OFFS/(RECOVERIES) | $ | (102 | ) |
| | $ | 801 |
| | | $ | (149 | ) |
| |
| | NET CHARGE-OFFS/(RECOVERIES) TO AVERAGE LOANS | (0.01 | ) | % | | 0.06 |
| % | | (0.01 | ) | % | |
| | | | | | | | | | | |
| YEAR-TO-DATE | | | | | | | | | |
| NET INCOME | $ | 13,516 |
|
| |
|
| | | $ | 15,079 |
|
| |
| DILUTED EARNINGS PER COMMON SHARE | $ | 2.23 |
|
| |
|
| | | $ | 2.51 |
|
| |
| RETURN ON AVERAGE ASSETS (ROA) | 0.97 |
| % | |
|
|
| | 1.10 |
| % | |
| RETURN ON AVERAGE EQUITY (ROE) | 8.75 |
| % | |
|
|
| | 10.65 |
| % | |
| EFFICIENCY RATIO | 62.79 |
| % | |
|
|
| | 59.24 |
| % | |
| TAX-EQUIVALENT NET INTEREST MARGIN1 | 3.88 |
| % | |
|
|
| | 4.17 |
| % | |
| NET CHARGE-OFFS/(RECOVERIES) | $ | 643 |
|
| |
|
| | | $ | (74 | ) |
| |
| NET CHARGE-OFFS/(RECOVERIES) TO AVERAGE LOANS | 0.05 |
| % | |
|
|
| | (0.01 | ) | % | |
| | | | | | | | | | | |
| AT PERIOD END | | | | | | | | | |
| | TOTAL ASSETS | $ | 1,882,794 |
|
| | $ | 1,870,762 |
| | | $ | 1,802,657 |
|
| |
| | | | | | | | | | | |
| | LOANS: | | | | | | | | | |
| | COMMERCIAL AND INDUSTRIAL | $ | 189,967 |
|
| | $ | 185,020 |
| | | $ | 201,516 |
|
| |
| | REAL ESTATE |
|
|
| | | | | |
| |
| | COMMERCIAL OWNER-OCCUPIED | $ | 239,335 |
|
| | $ | 235,121 |
| | | $ | 234,493 |
|
| |
| | COMMERCIAL INVESTOR-OWNED | $ | 671,677 |
|
| | $ | 663,357 |
| | | $ | 674,428 |
|
| |
| | CONSTRUCTION | $ | 54,921 |
|
| | $ | 48,754 |
| | | $ | 45,948 |
|
| |
| | HOME EQUITY | $ | 113,731 |
|
| | $ | 115,493 |
| | | $ | 109,655 |
|
| |
| | OTHER RESIDENTIAL | $ | 71,682 |
|
| | $ | 73,721 |
| | | $ | 75,992 |
|
| |
| | INSTALLMENT AND OTHER CONSUMER LOANS | $ | 21,887 |
|
| | $ | 17,739 |
| | | $ | 18,953 |
|
| |
| | TOTAL LOANS | $ | 1,363,200 |
|
| | $ | 1,339,205 |
| | | $ | 1,360,985 |
|
| |
| | | | | | | | | | | |
| | NON-PERFORMING LOANS2: |
|
|
| | | | | |
| |
| | COMMERCIAL AND INDUSTRIAL | $ | 354 |
|
| | $ | 347 |
| | | $ | 193 |
|
| |
| | REAL ESTATE |
|
|
| | | | | |
| |
| | COMMERCIAL OWNER-OCCUPIED | $ | — |
|
| | $ | 1,403 |
| | | $ | 1,403 |
|
| |
| | COMMERCIAL INVESTOR-OWNED | $ | 2,020 |
|
| | $ | 2,278 |
| | | $ | 2,505 |
|
| |
| | CONSTRUCTION | $ | 2 |
|
| | $ | 2,733 |
| | | $ | 5,173 |
|
| |
| | HOME EQUITY | $ | 172 |
|
| | $ | 265 |
| | | $ | 436 |
|
| |
| | OTHER RESIDENTIAL | $ | — |
|
| | $ | — |
| | | $ | — |
|
| |
| | INSTALLMENT AND OTHER CONSUMER LOANS | $ | 90 |
|
| | $ | 42 |
| | | $ | 128 |
|
| |
| | TOTAL NON-ACCRUAL LOANS | $ | 2,638 |
|
| | $ | 7,068 |
| | | $ | 9,838 |
|
| |
| | | | | | | | | | | |
| | CLASSIFIED LOANS (GRADED SUBSTANDARD & DOUBTFUL) | $ | 24,023 |
| | | $ | 27,806 |
| | | $ | 38,999 |
| | |
| | TOTAL ACCRUING LOANS 30-89 DAYS PAST DUE | $ | 3,361 |
|
| | $ | 1,151 |
| | | $ | 299 |
|
| |
| | LOAN LOSS RESERVE TO LOANS | 1.06 |
| % | | 1.07 |
| % | | 1.11 |
| % | |
| | LOAN LOSS RESERVE TO NON-ACCRUAL LOANS | 5.48 |
| x | | 2.03 |
| x | | 1.53 |
| x | |
| | NON-ACCRUAL LOANS TO TOTAL LOANS | 0.19 |
| % | | 0.53 |
| % | | 0.73 |
| % | |
| | TEXAS RATIO3 | 1.41 |
| % | | 3.54 |
| % | | 5.14 |
| % | |
| | | | | | | | | | | |
| | TOTAL DEPOSITS | $ | 1,635,482 |
|
| | $ | 1,630,483 |
| | | $ | 1,571,624 |
|
| |
| | LOAN-TO-DEPOSIT RATIO | 83.4 |
| % | | 82.1 |
| % | | 86.6 |
| % | |
| | STOCKHOLDERS' EQUITY | $ | 211,954 |
|
| | $ | 207,182 |
| | | $ | 195,674 |
|
| |
| | BOOK VALUE PER SHARE | $ | 34.97 |
|
| | $ | 34.63 |
| | | $ | 33.00 |
|
| |
| | TANGIBLE COMMON EQUITY TO TANGIBLE ASSETS4 | 10.8 |
| % | | 10.6 |
| % | | 10.3 |
| % | |
| | TOTAL RISK-BASED CAPITAL RATIO-BANK5 | 13.6 |
| % | | 13.8 |
| % | | 13.3 |
| % | |
| | TOTAL RISK-BASED CAPITAL RATIO-BANCORP5 | 14.0 |
| % | | 14.1 |
| % | | 13.6 |
| % | |
| | FULL-TIME EQUIVALENT EMPLOYEES | 257 |
| | | 261 |
| | | 257 |
| | |
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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 $18.8 million, $16.1 million and $16.9 million at September 30, 2015, June 30, 2015 and September 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 September 30, 2015, June 30, 2015 and September 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 $3.7 million, $5.1 million and $5.2 million at September 30, 2015, June 30, 2015 and September 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 $9.7 million, $9.9 million and $10.4 million at September 30, 2015, June 30, 2015 and September 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 September 30, 2015, June 30, 2015 and September 30, 2014 |
|
| | | | | | | | | | | |
| (in thousands, except share data; unaudited) | September 30, 2015 | | June 30, 2015 | | September 30, 2014 |
| Assets | |
| | | | |
| Cash and due from banks | $ | 35,315 |
| | $ | 117,533 |
| | $ | 46,424 |
|
| Investment securities | |
| | |
| | |
| Held-to-maturity, at amortized cost | 86,471 |
| | 94,475 |
| | 118,843 |
|
| Available-for-sale (at fair value; amortized cost $331,024, $252,709 and $210,676 at September 30, 2015, June 30, 2015 and September 30, 2014, respectively) | 333,856 |
| | 254,018 |
| | 211,582 |
|
| Total investment securities | 420,327 |
| | 348,493 |
| | 330,425 |
|
| Loans, net of allowance for loan losses of $14,457, $14,355 and $15,049 at September 30, 2015, June 30, 2015 and September 30, 2014, respectively | 1,348,743 |
| | 1,324,851 |
| | 1,345,936 |
|
| Bank premises and equipment, net | 9,537 |
| | 9,673 |
| | 9,277 |
|
| Goodwill | 6,436 |
| | 6,436 |
| | 6,436 |
|
| Core deposit intangible | 3,268 |
| | 3,423 |
| | 3,925 |
|
| Interest receivable and other assets | 59,168 |
| | 60,353 |
| | 60,234 |
|
| Total assets | $ | 1,882,794 |
| | $ | 1,870,762 |
| | $ | 1,802,657 |
|
| | | | | | |
| Liabilities and Stockholders' Equity | |
| | |
| | |
| Liabilities | |
| | |
| | |
| Deposits | | | |
| | |
| Non-interest bearing | $ | 752,336 |
| | $ | 741,107 |
| | $ | 717,720 |
|
| Interest bearing | | | |
| | |
| Transaction accounts | 95,522 |
| | 95,622 |
| | 89,891 |
|
| Savings accounts | 136,021 |
| | 132,377 |
| | 127,774 |
|
| Money market accounts | 495,642 |
| | 502,263 |
| | 485,626 |
|
| Time accounts | 155,961 |
| | 159,114 |
| | 150,613 |
|
| Total deposits | 1,635,482 |
| | 1,630,483 |
| | 1,571,624 |
|
| Federal Home Loan Bank ("FHLB") borrowings | 15,000 |
| | 15,000 |
| | 15,000 |
|
| Subordinated debentures | 5,343 |
| | 5,291 |
| | 5,131 |
|
| Interest payable and other liabilities | 15,015 |
| | 12,806 |
| | 15,228 |
|
| Total liabilities | 1,670,840 |
| | 1,663,580 |
| | 1,606,983 |
|
| | | | | | |
| 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 - 6,060,744, 5,983,551 and
5,930,100 at September 30, 2015, June 30, 2015 and
September 30, 2014, respectively | 84,272 |
| | 83,826 |
| | 81,993 |
|
| Retained earnings | 126,082 |
| | 122,625 |
| | 113,115 |
|
| Accumulated other comprehensive income, net | 1,600 |
| | 731 |
| | 566 |
|
| Total stockholders' equity | 211,954 |
| | 207,182 |
| | 195,674 |
|
| Total liabilities and stockholders' equity | $ | 1,882,794 |
| | $ | 1,870,762 |
| | $ | 1,802,657 |
|
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BANK OF MARIN BANCORP CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME |
|
| | | | | | | | | | | | | | | | | | | |
| | Three months ended | | Nine months ended |
| (in thousands, except per share amounts; unaudited) | September 30, 2015 | | June 30, 2015 | | September 30, 2014 | | September 30, 2015 | | September 30, 2014 |
| Interest income | | | | | | | | | |
| Interest and fees on loans | $ | 15,498 |
| | $ | 15,287 |
| | $ | 16,195 |
| | $ | 46,164 |
| | $ | 48,877 |
|
| Interest on investment securities |
|
| |
|
| |
|
| | | | |
| Securities of U.S. government agencies | 1,223 |
| | 990 |
| | 1,126 |
| | 3,248 |
| | 3,551 |
| Obligations of state and political subdivisions | 527 |
| | 511 |
| | 496 |
| | 1,578 |
| | 1,737 |
|
| Corporate debt securities and other | 162 |
| | 179 |
| | 254 |
| | 546 |
| | 778 |
|
| Interest on Federal funds sold and due from banks | 35 |
| | 51 |
| | 37 |
| | 107 |
| | 125 |
|
| Total interest income | 17,445 |
| | 17,018 |
| | 18,108 |
| | 51,643 |
| | 55,068 |
|
| Interest expense | |
| | |
| | |
| | |
| | |
|
| Interest on interest-bearing transaction accounts | 28 |
| | 30 |
| | 25 |
| | 88 |
| | 74 |
|
| Interest on savings accounts | 12 |
| | 13 |
| | 12 |
| | 37 |
| | 34 |
|
| Interest on money market accounts | 125 |
| | 123 |
| | 126 |
| | 375 |
| | 415 |
|
| Interest on time accounts | 212 |
| | 215 |
| | 229 |
| | 649 |
| | 695 |
|
| Interest on FHLB and overnight borrowings | 80 |
| | 78 |
| | 79 |
| | 236 |
| | 235 |
|
| Interest on subordinated debentures | 105 |
| | 105 |
| | 106 |
| | 314 |
| | 316 |
|
| Total interest expense | 562 |
|
| 564 |
|
| 577 |
| | 1,699 |
| | 1,769 |
|
| Net interest income | 16,883 |
| | 16,454 |
| | 17,531 |
| | 49,944 |
| | 53,299 |
|
| Provision for loan losses | — |
| | — |
| | — |
| | — |
| | 750 |
|
| Net interest income after provision for loan losses | 16,883 |
| | 16,454 |
| | 17,531 |
| | 49,944 |
| | 52,549 |
|
| Non-interest income | |
| | |
| | |
| | |
| | |
|
| Service charges on deposit accounts | 489 |
| | 504 |
| | 552 |
| | 1,518 |
| | 1,636 |
|
| Wealth Management and Trust Services | 568 |
| | 603 |
| | 567 |
| | 1,809 |
| | 1,744 |
|
| Debit card interchange fees | 372 |
| | 368 |
| | 375 |
| | 1,087 |
| | 1,035 |
|
| Merchant interchange fees | 171 |
| | 129 |
| | 224 |
| | 430 |
| | 629 |
|
| Earnings on bank-owned life insurance | 204 |
| | 203 |
| | 208 |
| | 610 |
| | 632 |
|
| Dividends on FHLB stock | 209 |
| | 461 |
| | 149 |
| | 817 |
| | 409 |
|
| Gain on sale of securities | 72 |
| | — |
| | 4 |
| | 80 |
| | 93 |
|
| Other income | 213 |
| | 340 |
| | 222 |
| | 744 |
| | 707 |
|
| Total non-interest income | 2,298 |
| | 2,608 |
|
| 2,301 |
| | 7,095 |
| | 6,885 |
|
| Non-interest expense | |
| | |
| | |
| | |
| | |
|
| Salaries and related benefits | 6,300 |
| | 6,672 |
| | 6,108 |
| | 19,762 |
| | 19,270 |
|
| Occupancy and equipment | 1,346 |
| | 1,493 |
| | 1,381 |
| | 4,181 |
| | 4,044 |
|
| Depreciation and amortization | 441 |
| | 650 |
| | 383 |
| | 1,512 |
| | 1,202 |
|
| Federal Deposit Insurance Corporation insurance | 250 |
| | 253 |
| | 261 |
| | 739 |
| | 780 |
|
| Data processing | 835 |
| | 792 |
| | 748 |
| | 2,413 |
| | 2,856 |
|
| Professional services | 493 |
| | 515 |
| | 537 |
| | 1,572 |
| | 1,577 |
|
| Directors' expense | 182 |
| | 247 |
| | 153 |
| | 620 |
| | 466 |
|
| Information technology | 186 |
| | 216 |
| | 180 |
| | 554 |
| | 517 |
|
| Provision for (reversal of) losses on off-balance sheet commitments | 324 |
| | (109 | ) | | 13 |
| | 14 |
| | (2 | ) |
| Other expense | 1,281 |
| | 1,590 |
| | 1,586 |
| | 4,447 |
| | 4,940 |
|
| Total non-interest expense | 11,638 |
|
| 12,319 |
|
| 11,350 |
| | 35,814 |
| | 35,650 |
|
| Income before provision for income taxes | 7,543 |
| | 6,743 |
| | 8,482 |
| | 21,225 |
| | 23,784 |
|
| Provision for income taxes | 2,770 |
| | 2,457 |
| | 3,104 |
| | 7,709 |
| | 8,705 |
|
| Net income | $ | 4,773 |
| | $ | 4,286 |
| | $ | 5,378 |
| | $ | 13,516 |
| | $ | 15,079 |
|
| Net income per common share: | |
| | |
| | |
| | | | |
| Basic | $ | 0.80 |
| | $ | 0.72 |
| | $ | 0.91 |
| | $ | 2.27 |
| | $ | 2.56 |
|
| Diluted | $ | 0.79 |
| | $ | 0.71 |
| | $ | 0.89 |
| | $ | 2.23 |
| | $ | 2.51 |
|
| Weighted average shares used to compute net income per common share: |
|
| | | | |
| | | | |
| Basic | 5,963 |
| | 5,945 |
| | 5,903 |
| | 5,943 |
| | 5,887 |
|
| Diluted | 6,067 |
| | 6,062 |
| | 6,014 |
| | 6,059 |
| | 5,996 |
|
| Dividends declared per common share | $ | 0.22 |
| | $ | 0.22 |
| | $ | 0.20 |
| | $ | 0.66 |
| | $ | 0.58 |
|
| Comprehensive income: | | | | | | | | | |
| Net income | $ | 4,773 |
| | $ | 4,286 |
| | $ | 5,378 |
| | $ | 13,516 |
| | $ | 15,079 |
|
| Other comprehensive income |
|
| | | |
|
| |
|
| |
|
|
Change in net unrealized gain (loss) on available-for- sale securities | 1,523 |
| | (1,803 | ) | | (344 | ) | | 1,037 |
| | 2,047 |
|
Reclassification adjustment for loss (gain) on available- for-sale securities included in net income | — |
| | — |
| | 4 |
| | (8 | ) | | 19 |
|
Net change in unrealized gain (loss) on available-for- sale securities, before tax | 1,523 |
| | (1,803 | ) | | (340 | ) | | 1,029 |
| | 2,066 |
|
| Deferred tax (benefit) expense | 654 |
| | (691 | ) | | (141 | ) | | 517 |
| | 828 |
|
| Other comprehensive income (loss), net of tax | 869 |
| | (1,112 | ) | | (199 | ) | | 512 |
| | 1,238 |
|
| Comprehensive income | $ | 5,642 |
| | $ | 3,174 |
| | $ | 5,179 |
| | $ | 14,028 |
| | $ | 16,317 |
|
|
|
| BANK OF MARIN BANCORP |
| AVERAGE STATEMENTS OF CONDITION AND ANALYSIS OF NET INTEREST INCOME |
|
| | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | |
| | | Three months ended | Three months ended | Three months ended |
| | | September 30, 2015 | June 30, 2015 | September 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 | $ | 51,378 |
| $ | 35 |
| 0.27 | % | $ | 76,710 |
| $ | 52 |
| 0.27 | % | $ | 58,088 |
| $ | 37 |
| 0.25 | % |
| | Investment securities 2, 3 | 389,260 |
| 2,094 |
| 2.15 | % | 319,032 |
| 1,842 |
| 2.31 | % | 332,920 |
| 1,997 |
| 2.40 | % |
| | Loans 1, 3, 4 | 1,352,023 |
| 15,800 |
| 4.57 | % | 1,336,249 |
| 15,587 |
| 4.61 | % | 1,349,740 |
| 16,489 |
| 4.78 | % |
| | Total interest-earning assets 1 | 1,792,661 |
| 17,929 |
| 3.91 | % | 1,731,991 |
| 17,481 |
| 3.99 | % | 1,740,748 |
| 18,523 |
| 4.16 | % |
| | Cash and non-interest-bearing due from banks | 43,054 |
| | | 48,955 |
| | | 46,258 |
| | |
| | Bank premises and equipment, net | 9,680 |
| | | 9,841 |
| | | 9,337 |
| | |
| | Interest receivable and other assets, net | 57,589 |
| | | 58,744 |
| | | 56,855 |
| | |
| Total assets | $ | 1,902,984 |
| | | $ | 1,849,531 |
| | | $ | 1,853,198 |
| | |
| Liabilities and Stockholders' Equity | | | | | | | | | |
| | Interest-bearing transaction accounts | $ | 93,933 |
| $ | 28 |
| 0.12 | % | $ | 94,960 |
| $ | 30 |
| 0.13 | % | $ | 92,907 |
| $ | 25 |
| 0.11 | % |
| | Savings accounts | 135,202 |
| 13 |
| 0.04 | % | 131,564 |
| 12 |
| 0.04 | % | 127,457 |
| 12 |
| 0.04 | % |
| | Money market accounts | 506,952 |
| 125 |
| 0.10 | % | 488,422 |
| 123 |
| 0.10 | % | 501,843 |
| 126 |
| 0.10 | % |
| | Time accounts | 157,252 |
| 212 |
| 0.53 | % | 157,982 |
| 215 |
| 0.55 | % | 152,995 |
| 229 |
| 0.59 | % |
| | FHLB borrowing and overnight borrowings1 | 15,188 |
| 79 |
| 2.07 | % | 15,000 |
| 79 |
| 2.07 | % | 15,000 |
| 79 |
| 2.07 | % |
| | Subordinated debentures 1 | 5,316 |
| 105 |
| 7.73 | % | 5,259 |
| 105 |
| 7.90 | % | 5,096 |
| 106 |
| 8.14 | % |
| | Total interest-bearing liabilities | 913,843 |
| 562 |
| 0.24 | % | 893,187 |
| 564 |
| 0.25 | % | 895,298 |
| 577 |
| 0.26 | % |
| | Demand accounts | 765,284 |
| | | 735,481 |
| | | 749,361 |
| | |
| | Interest payable and other liabilities | 13,467 |
| | | 14,358 |
| | | 14,167 |
| | |
| | Stockholders' equity | 210,390 |
| | | 206,505 |
| | | 194,372 |
| | |
| Total liabilities & stockholders' equity | $ | 1,902,984 |
| | | $ | 1,849,531 |
| | | $ | 1,853,198 |
| | |
Tax-equivalent net interest income/margin 1 | | $ | 17,367 |
| 3.79 | % | | $ | 16,917 |
| 3.86 | % | | $ | 17,946 |
| 4.03 | % |
Reported net interest income/margin 1 | | $ | 16,883 |
| 3.69 | % | | $ | 16,454 |
| 3.76 | % | | $ | 17,531 |
| 3.94 | % |
| Tax-equivalent net interest rate spread | |
| 3.67 | % | | | 3.74 | % | | | 3.91 | % |
| | | | | | | | | | | |
| | | Nine months ended | Nine months ended | |
| | | September 30, 2015 | September 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 | $ | 55,509 |
| $ | 107 |
| 0.25 | % | $ | 65,949 |
| $ | 125 |
| 0.25 | % | | | |
| | Investment securities 2, 3 | 340,373 |
| 5,864 |
| 2.30 | % | 348,445 |
| 6,498 |
| 2.49 | % | | | |
| | Loans 1, 3, 4 | 1,346,689 |
| 47,063 |
| 4.61 | % | 1,307,611 |
| 49,606 |
| 5.00 | % | | | |
| | Total interest-earning assets 1 | 1,742,571 |
| 53,034 |
| 4.01 | % | 1,722,005 |
| 56,229 |
| 4.31 | % |
|
|
|
| |
| | Cash and non-interest-bearing due from banks | 44,368 |
|
|
| 43,280 |
|
|
| | | |
| | Bank premises and equipment, net | 9,786 |
|
|
| 9,218 |
|
|
| | | |
| | Interest receivable and other assets, net | 58,153 |
|
|
| 56,550 |
|
|
| | | |
| Total assets | $ | 1,854,878 |
|
|
| $ | 1,831,053 |
|
|
|
|
| | |
| Liabilities and Stockholders' Equity |
|
|
|
|
|
| | | |
| | Interest-bearing transaction accounts | $ | 93,762 |
| $ | 88 |
| 0.13 | % | $ | 104,662 |
| $ | 74 |
| 0.09 | % | | | |
| | Savings accounts | 133,553 |
| 38 |
| 0.04 | % | 122,958 |
| 34 |
| 0.04 | % | | | |
| | Money market accounts | 494,142 |
| 375 |
| 0.10 | % | 508,544 |
| 415 |
| 0.11 | % | | | |
| | Time accounts | 156,458 |
| 648 |
| 0.55 | % | 156,892 |
| 695 |
| 0.59 | % | | | |
| | FHLB borrowing and overnight borrowings1 | 15,194 |
| 236 |
| 2.07 | % | 15,000 |
| 235 |
| 2.07 | % | | | |
| | Subordinated debentures 1 | 5,261 |
| 314 |
| 7.98 | % | 5,043 |
| 316 |
| 8.42 | % | | | |
| Total interest-bearing liabilities | 898,370 |
| 1,699 |
| 0.25 | % | 913,099 |
| 1,769 |
| 0.26 | % | | | |
| Demand accounts | 735,487 |
|
|
| 713,882 |
|
|
| | | |
| Interest payable and other liabilities | 14,466 |
|
|
| 14,725 |
|
|
| | | |
| Stockholders' equity | 206,555 |
|
|
| 189,347 |
|
|
| | | |
| Total liabilities & stockholders' equity | $ | 1,854,878 |
|
|
| $ | 1,831,053 |
|
|
|
|
| | |
Tax-equivalent net interest income/margin 1 |
| $ | 49,944 |
| 3.88 | % |
| $ | 54,460 |
| 4.17 | % | | | |
Reported net interest income/margin 1 |
| $ | 51,336 |
| 3.78 | % |
| $ | 53,299 |
| 4.08 | % | | | |
| Tax-equivalent net interest rate spread |
|
| 3.76 | % |
|
| 4.05 | % | | | |
| | | | | |
| | | | | | | | | | | |
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. |
