EXHIBIT 99.1
Blue Hills Bancorp, Inc. Announces First Quarter 2015 Earnings
NORWOOD, Mass.--(BUSINESS WIRE)—Blue Hills Bancorp, Inc. (the “Company” or "Blue Hills Bancorp") (NASDAQ: BHBK), the parent of Blue Hills Bank (the "Bank"), today announced net income of $1,306,000 for the first quarter of 2015 compared to net income, excluding certain nonrecurring items, of $2,563,000 for the fourth quarter of 2014 and net income of $435,000 for the first quarter of 2014.
The following nonrecurring items were excluded from the results discussed above for the fourth quarter of 2014 and the first quarter of 2014 (see page 12 for a reconciliation of GAAP to non-GAAP measures; no items were excluded from the first quarter of 2015).
| |
| • | A gain of $182,000 for the quarter ended December 31, 2014 related to non-taxable death benefits received on bank-owned life insurance. |
| |
| • | Pre-tax expenses of $775,000 and $488,000, respectively, for the quarter ended March 31, 2014, related to the January 2014 Nantucket Bank acquisition and the Company's mutual to stock conversion. Related income tax benefits amounted to $429,000. |
On a GAAP basis, which includes the nonrecurring items discussed above, the Company reported net income of $1,306,000 for the quarter ended March 31, 2015, net income of $2,745,000 for the quarter ended December 31, 2014, and a net loss of $399,000 for the quarter ended March 31, 2014.
Diluted earnings per share was $0.05 for the first quarter of 2015 compared to $0.10 for the fourth quarter of 2014. Fourth quarter 2014 earnings per share was the same with and without the nonrecurring item mentioned above. Blue Hills Bancorp was not a publicly traded company in the first quarter of 2014 and earnings per share is not applicable for that period.
Commenting on the first quarter results, William Parent, President and Chief Executive Officer of Blue Hills Bancorp, said "We continued to make progress this quarter in executing our plan of becoming a diversified full service community bank. While competition for lending business is very intense and we endured some abnormally bad weather, we were still able to grow our loan portfolio by 3%, or 12% annualized, from the end of 2014. Deposits were up slightly from the end of the year even with an expected seasonal decline in Nantucket and we are very pleased with the progress made by our Milton branch with over $25 million of deposits at the end of March from its opening in October of last year. In addition, the quarter also reflected good expense control with noninterest expense down slightly from the fourth quarter."
Mr. Parent continued, "Our mutual to stock conversion has provided us with a significant amount of capital. With a tangible common equity ratio above 23%, we are mindful of deploying the excess capital in ways that are both consistent with our long-term goals and in the best interest of our shareholders."
BALANCE SHEET
Total assets grew $30 million during the first three months of 2015 to $1.8 billion at March 31, 2015, mainly due to loans which were up $33 million, or 3%. The higher level of loans was driven primarily by growth in the commercial real estate portfolio which was up $20 million, or 5%, from December 31, 2014. Other loan categories had smaller increases the largest of which was construction loans, up $6 million, or 12%.
Compared to March 31, 2014, total assets increased $258 million, or 17%. Loans accounted for essentially all of the growth in total assets reflecting a combination of originations and participations as the Company continued to execute on its strategy to diversify its balance sheet. By category, commercial real estate loans were up $95 million, or 31%; residential mortgages were up $82 million, or 21%; commercial business loans were up $39 million, or 34%; and construction loans were up $36 million, or 150%.
Total deposits grew $8 million, or less than 1%, during the first quarter of 2015, to $1.2 billion at March 31, 2015. Compared to the end of 2014, small increases in the NOW/demand and the certificates of deposit categories were partially offset by slight
declines in regular savings and money market deposits. Deposits were impacted by continued growth in our new Milton, Massachusetts branch and a seasonal decline at Nantucket Bank. Brokered deposit balances were essentially unchanged from December 31, 2014 while short-term borrowings increased $30 million during the first quarter to $70 million at March 31, 2015. Compared to March 31, 2014, deposits increased $104 million, or 9%. This included an increase of $42 million in customer deposits, which was mainly due to a higher level of money market deposits partially offset by a decline in regular savings deposits. Brokered deposits grew $62 million from a year ago.
Stockholders’ equity was $415 million at March 31, 2015 compared to $412 million at December 31, 2014 and $173 million at December 31, 2013. The increase from a year ago reflects the Company's mutual to stock conversion that was completed in July 2014. Proceeds from the stock offering were used to fund asset growth and to pay down debt and, as a result, borrowings declined to $105 million at March 31, 2015 from $195 million at March 31, 2014. As part of the conversion, the Company also (1) redeemed $18.7 million of preferred stock that had been issued to the U.S. Treasury as part of the Small Business Lending Fund Program and (2) established an employee stock ownership plan ("ESOP") which acquired 8% of the shares issued in the conversion. The $21.8 million related to the ESOP is shown as a reduction to stockholders' equity on the balance sheet. The tangible common equity to tangible assets ratio increased to 23.04% at March 31, 2015 from 9.40% at March 31, 2014 as a result of the additional capital received from the mutual to stock conversion.
NET INTEREST AND DIVIDEND INCOME
Net interest and dividend income was $10.7 million in the first quarter of 2015, down $1.9 million, or 15%, from $12.6 million in the fourth quarter of 2014. Net interest margin declined to 2.62% in the first quarter of 2015 from 3.07% in the fourth quarter of 2014. The decline in net interest income and margin from the fourth quarter was due to a $2.1 million drop in dividend income reflecting a lower level of dividends received on mutual fund investments. The vast majority of dividends from the mutual fund investments is typically received in the second half of the year. Excluding the decline in mutual fund dividends, net interest income increased $221,000, or 2%, from the fourth quarter of 2014 while net interest margin improved 7 basis points to 2.67% in the first quarter of 2015 from 2.60% in the fourth quarter of 2014. The improvement, was due in part to a repositioning of our debt securities portfolio which has resulted in a higher yield. In addition, net interest income benefited from a $30 million, or 3%, increase in average loans. Partially offsetting these improvements was a 4 basis point increase in the cost of interest bearing liabilities to 0.69% in the first quarter of 2015 due primarily to the impact of promotional rate deposit pricing programs. Net interest income and margin in both quarters were impacted by purchase accounting accretion related to the January 2014 Nantucket Bank acquisition. Accretion in the first quarter of 2015 contributed $220,000 to net interest income compared to $186,000 in the fourth quarter of 2014. Nantucket accretion also added approximately 5 basis points to net interest margin in each quarter. The $3.4 million remaining balance of accretable yield at March 31, 2015 is expected to be recorded to net interest income in future quarters.
Compared to the first quarter of 2014, net interest and dividend income increased $2.2 million, or 25%, while net interest margin improved 10 basis points. The improvement in net interest income reflects a $298 million, or 34%, increase in average loans driven by higher levels of loans in all categories, with the biggest growth seen in the residential mortgage and commercial real estate portfolios. The bulk of the loan growth was funded with a significant increase in noninterest bearing funds, which benefited both net interest income and margin. Average equity increased $241 million due to the Company's mutual to stock conversion while average noninterest bearing deposits increased $30 million, or 31%, to $126 million in the first quarter of 2015. Purchase accounting accretion related to the January 2014 Nantucket Bank acquisition contributed $220,000 to net interest income and 5 basis points to net interest margin in the first quarter of 2015 compared to $190,000 and 6 basis points, respectively, in the first quarter of 2014. These benefits were partially offset by an 11 basis point increase in the cost of interest bearing liabilities from the first quarter of last year.
NONINTEREST INCOME
Noninterest income was $2.2 million in the first quarter of 2015 compared to $2.1 million in the fourth quarter of 2014, excluding a $182,000 bank-owned life insurance death benefit that was recognized last quarter. Securities gains increased $884,000 to $1.3 million in the first quarter of 2015. This increase was partially offset by (1) lower deposit account fees and interchange and ATM fees due to seasonality, (2) a decline in mortgage banking income mainly due to lower gains on the sale of jumbo residential loans, and (3) a decline in loan level derivative income reflecting fewer conversions of commercial loans from floating to fixed rate. In addition, the Company reported negative miscellaneous income in the first quarter as a decline in interest rates resulted in higher negative marks on commercial loan customer interest rate swap contracts. While these interest rate marks create quarterly volatility in the results which is at times significant, barring
unforeseen circumstances there is no net impact to earnings over the life of each contract. Miscellaneous income was also impacted by the absence of income recorded in the fourth quarter of 2014 from a commercial loan prepayment and the settlements of class action lawsuits related to legacy investments.
Compared to the first quarter of 2014, noninterest income increased $555,000, or 34%, due mainly to a $777,000 increase in securities gains. In addition, deposit account fees and interchange and ATM fees improved due to changes in the fee structure, debit card activity, and a full quarter of fees from Nantucket Bank in 2015 vs. a partial quarter in 2014. Mortgage banking income also increased from a year ago due mainly to higher gains from the sale of conventional residential mortgage loans. These improvements were partially offset by some of the factors discussed above including a lower level of loan derivative income and a higher negative mark on commercial loan customer interest rate swap contracts related to changes in interest rates.
NONINTEREST EXPENSE
Noninterest expense was $10.6 million in the first quarter of 2015 compared to $10.7 million in the fourth quarter of 2014.
The decline from last quarter reflected a $257,000 drop in expenses related to the employee stock ownership plan (ESOP) that was implemented last year in connection with the mutual to stock conversion. The equivalent of a full year of ESOP expense was recorded in the final two quarters of 2014 and the ESOP expense in the first quarter of 2015 is more representative of a normal quarterly cost for this plan. In addition, advertising expense declined $153,000. These declines were partially offset by higher occupancy and equipment expense due, in part, to a significant increase in snow removal costs related to the severe winter weather experienced throughout our service area.
Noninterest expense of $10.3 million in the first quarter of 2014 included $775,000 of one-time costs related to the January 2014 Nantucket Bank acquisition and $488,000 related to the Company's mutual to stock conversion. Excluding these items, noninterest expense was $9.0 million in the first quarter of 2014, compared to $10.6 million in the first quarter of 2015. The $1.6 million increase reflects (1) a full quarter of operating expenses and core deposit intangible amortization for Nantucket Bank in the first quarter of 2015 vs. a partial quarter a year ago, (2) higher advertising expense, (3) the opening of the Milton, Massachusetts branch and the establishment of a loan production office in Plymouth, Massachusetts, (4) higher expenses related to the ESOP which went into effect at the time of the mutual to stock conversion, and (5) an increase in snow removal costs.
ASSET QUALITY
The provision for loan losses was $279,000 in the first quarter of 2015 compared to $270,000 in the fourth quarter of 2014 and $714,000 in the first quarter of 2014. The provisions in all quarters reflect management’s assessment of the risks inherent in the loan portfolio. Provisions in each of the three quarters were significantly higher than net chargeoffs. The Company had net loan chargeoffs of $14,000 in the first quarter of 2015, $19,000 in the fourth quarter of 2014 and $39,000 in the first quarter of 2014.
The allowance for loan losses as a percentage of total loans was 1.12% at March 31, 2015 compared to 1.13% at December 31, 2014, and 1.12% at March 31, 2014. The allowance for loan losses as a percentage of nonaccrual loans was 278% at March 31, 2015 compared to 290% at December 31, 2014 and 268% at March 31, 2014.
Nonperforming assets were $4.8 million at March 31, 2015 compared to $4.5 million at December 31, 2014 and $3.9 million at March 31, 2014. Nonperforming assets as a percentage of total assets were 0.27% at March 31, 2015 compared to 0.26% at both December 31, 2014 and March 31, 2014.
ABOUT BLUE HILLS BANCORP
Blue Hills Bancorp, Inc., with corporate headquarters in Norwood MA, had assets of $1.8 billion at March 31, 2015 and operates 10 branch offices in Brookline, Dedham, Hyde Park, Milton, Nantucket, Norwood and West Roxbury, Massachusetts. Blue Hills Bank is a full service, community bank with its main office in Hyde Park, Massachusetts. The three branches in Nantucket, Massachusetts operate under the name, Nantucket Bank, a division of Blue Hills Bank. The Bank provides consumer and commercial deposit and loan products to Eastern Massachusetts through a growing branch network and eCommerce channels. The Bank offers commercial and industrial and commercial real estate loans in addition to cash management services and commercial deposit accounts. The Bank also serves consumers through a full suite of consumer banking products including checking accounts, mortgage loans, equity lines of credit and traditional savings and certificate of deposit accounts. The Bank has invested substantially in online technology including online account opening and funding, online mortgage applications,
online banking, mobile banking, bill pay and mobile deposits. Previously known as Hyde Park Savings Bank, Blue Hills Bank has been serving area residents for over 140 years. For more information about Blue Hills Bank, visit the Blue Hills web site at www.bluehillsbank.com.
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
This press release, as well as other written communications made from time to time by the Company and its subsidiaries and oral communications made from time to time by authorized officers of the Company, may contain statements relating to the future results of the Company (including certain projections and business trends) that are considered "forward-looking statements" as defined in the Private Securities Litigation Reform Act of 1995 (the PSLRA). Such forward-looking statements may be identified by the use of such words as "believe," "expect," "anticipate," "should," "planned," "estimated," "intend" and "potential." For these statements, the Company claims the protection of the safe harbor for forward-looking statements contained in the PSLRA.
The Company cautions you that a number of important factors could cause actual results to differ materially from those currently anticipated in any forward-looking statement. Such factors include, but are not limited to: our ability to implement successfully our new business strategy, which includes significant asset and liability growth; changes that could adversely affect the business in which the Company and the Bank are engaged; prevailing economic and geopolitical conditions; changes in interest rates, loan demand, real estate values and competition; changes in accounting principles, policies, and guidelines; changes in any applicable law, rule, regulation or practice with respect to tax or legal issues; and other economic, competitive, governmental, regulatory and technological factors affecting the Company's operations, pricing, products and services. For additional information on some of the risks and important factors that could affect the Company’s future results and financial condition, see “Risk Factors” in the Company’s Annual Report on Form 10-K as filed with the Securities and Exchange Commission. The forward-looking statements are made as of the date of this release, and, except as may be required by applicable law or regulation, the Company assumes no obligation to update the forward-looking statements or to update the reasons why actual results could differ from those projected in the forward-looking statements.
Media and Investor Contact:
William Parent, 617-360-6520
Blue Hills Bancorp, Inc.
Consolidated Balance Sheets
|
| | | | | | | | | | | | | |
| (Dollars in thousands) | | % Change |
| | March 31, 2015 | December 31, 2014 | March 31, 2014 | March 31, 2015 vs. December 31, 2014 | March 31, 2015 vs. March 31, 2014 |
| Assets | | | | | |
| Cash and due from banks | $ | 10,045 |
| $ | 15,345 |
| $ | 17,811 |
| (34.5 | )% | (43.6 | )% |
| Short term investments | 26,966 |
| 44,801 |
| 29,402 |
| (39.8 | ) | (8.3 | ) |
| Total cash and cash equivalents | 37,011 |
| 60,146 |
| 47,213 |
| (38.5 | ) | (21.6 | ) |
| Securities available for sale, at fair value | 429,551 |
| 416,447 |
| 444,959 |
| 3.1 |
| (3.5 | ) |
| Federal Home Loan Bank stock, at cost | 11,702 |
| 11,702 |
| 11,246 |
| — |
| 4.1 |
|
| Loans held for sale | 17,681 |
| 14,591 |
| 874 |
| 21.2 |
| 1,923.0 |
|
| Loans: | | | | | |
| 1-4 family residential | 463,334 |
| 461,719 |
| 381,613 |
| 0.3 |
| 21.4 |
|
| Home equity | 63,276 |
| 61,508 |
| 63,433 |
| 2.9 |
| (0.2 | ) |
| Commercial real estate | 405,670 |
| 385,228 |
| 310,266 |
| 5.3 |
| 30.7 |
|
| Construction | 59,513 |
| 53,258 |
| 23,787 |
| 11.7 |
| 150.2 |
|
| Total real estate loans | 991,793 |
| 961,713 |
| 779,099 |
| 3.1 |
| 27.3 |
|
| Commercial business | 154,367 |
| 151,521 |
| 115,099 |
| 1.9 |
| 34.1 |
|
| Consumer | 32,845 |
| 32,653 |
| 29,571 |
| 0.6 |
| 11.1 |
|
| Total loans | 1,179,005 |
| 1,145,887 |
| 923,769 |
| 2.9 |
| 27.6 |
|
| Allowance for loan losses | (13,238 | ) | (12,973 | ) | (10,346 | ) | 2.0 |
| 28.0 |
|
| Loans, net | 1,165,767 |
| 1,132,914 |
| 913,423 |
| 2.9 |
| 27.6 |
|
| Premises and equipment, net | 18,869 |
| 18,788 |
| 18,281 |
| 0.4 |
| 3.2 |
|
| Accrued interest receivable | 4,793 |
| 4,433 |
| 3,906 |
| 8.1 |
| 22.7 |
|
| Goodwill and core deposit intangible | 12,955 |
| 13,392 |
| 14,870 |
| (3.3 | ) | (12.9 | ) |
| Net deferred tax asset | 5,172 |
| 6,233 |
| 1,859 |
| (17.0 | ) | 178.2 |
|
| Bank-owned life insurance | 30,848 |
| 30,595 |
| 30,080 |
| 0.8 |
| 2.6 |
|
| Other assets | 23,535 |
| 18,907 |
| 12,816 |
| 24.5 |
| 83.6 |
|
| Total assets | $ | 1,757,884 |
| $ | 1,728,148 |
| $ | 1,499,527 |
| 1.7 | % | 17.2 | % |
| Liabilities and Stockholders' Equity | | | | | |
| NOW and demand | $ | 256,746 |
| $ | 245,117 |
| $ | 242,544 |
| 4.7 | % | 5.9 | % |
| Regular savings | 301,932 |
| 303,834 |
| 351,040 |
| (0.6 | ) | (14.0 | ) |
| Money market | 269,164 |
| 280,139 |
| 195,713 |
| (3.9 | ) | 37.5 |
|
| Certificates of deposit | 310,672 |
| 301,755 |
| 306,759 |
| 3.0 |
| 1.3 |
|
| Brokered money market | 23,991 |
| 23,166 |
| — |
| 3.6 |
| 100.0 |
|
| Brokered certificates of deposit | 58,705 |
| 58,705 |
| 20,705 |
| — |
| 183.5 |
|
| Total deposits | 1,221,210 |
| 1,212,716 |
| 1,116,761 |
| 0.7 |
| 9.4 |
|
| Short-term borrowings | 70,000 |
| 40,000 |
| 150,000 |
| 75.0 |
| (53.3 | ) |
| Long-term debt | 35,000 |
| 35,000 |
| 45,000 |
| — |
| (22.2 | ) |
| Other liabilities | 16,730 |
| 28,826 |
| 14,601 |
| (42.0 | ) | 14.6 |
|
| Total liabilities | 1,342,940 |
| 1,316,542 |
| 1,326,362 |
| 2.0 |
| 1.2 |
|
| Preferred stock | — |
| — |
| 18,724 |
| — |
| (100.0 | ) |
| Common stock | 285 |
| 285 |
| — |
| — |
| 100.0 |
|
| Additional paid-in capital | 281,094 |
| 281,035 |
| — |
| — |
| 100.0 |
|
| Unearned compensation- ESOP | (21,825 | ) | (22,014 | ) | — |
| (0.9 | ) | 100.0 |
|
| Retained earnings | 151,029 |
| 149,723 |
| 149,742 |
| 0.9 |
| 0.9 |
|
| Accumulated other comprehensive income | 4,361 |
| 2,577 |
| 4,699 |
| 69.2 |
| (7.2 | ) |
| Total stockholders' equity | 414,944 |
| 411,606 |
| 173,165 |
| 0.8 | % | 139.6 | % |
| Total liabilities and stockholders' equity | $ | 1,757,884 |
| $ | 1,728,148 |
| $ | 1,499,527 |
| 1.7 | % | 17.2 | % |
Blue Hills Bancorp, Inc
Consolidated Balance Sheet Trend
|
| | | | | | | | | | | | | | | |
| (Dollars in thousands) | March 31, 2015 | December 31, 2014 | September 30, 2014 | June 30, 2014 | March 31, 2014 |
| Assets | | | | | |
| Cash and due from banks | $ | 10,045 |
| $ | 15,345 |
| $ | 14,632 |
| $ | 15,308 |
| $ | 17,811 |
|
| Short term investments | 26,966 |
| 44,801 |
| 39,229 |
| 281,618 |
| 29,402 |
|
| Total cash and cash equivalents | 37,011 |
| 60,146 |
| 53,861 |
| 296,926 |
| 47,213 |
|
| Securities available for sale, at fair value | 429,551 |
| 416,447 |
| 417,164 |
| 417,581 |
| 444,959 |
|
| Federal Home Loan Bank stock, at cost | 11,702 |
| 11,702 |
| 11,702 |
| 11,702 |
| 11,246 |
|
| Loans held for sale | 17,681 |
| 14,591 |
| 2,465 |
| 22,398 |
| 874 |
|
| Loans: | | | | | |
| 1-4 family residential | 463,334 |
| 461,719 |
| 466,963 |
| 408,528 |
| 381,613 |
|
| Home equity | 63,276 |
| 61,508 |
| 62,958 |
| 62,508 |
| 63,433 |
|
| Commercial real estate | 405,670 |
| 385,228 |
| 368,069 |
| 334,647 |
| 310,266 |
|
| Construction | 59,513 |
| 53,258 |
| 56,939 |
| 45,192 |
| 23,787 |
|
| Total real estate loans | 991,793 |
| 961,713 |
| 954,929 |
| 850,875 |
| 779,099 |
|
| Commercial business | 154,367 |
| 151,521 |
| 138,357 |
| 120,313 |
| 115,099 |
|
| Consumer | 32,845 |
| 32,653 |
| 32,210 |
| 30,457 |
| 29,571 |
|
| Total loans | 1,179,005 |
| 1,145,887 |
| 1,125,496 |
| 1,001,645 |
| 923,769 |
|
| Allowance for loan losses | (13,238 | ) | (12,973 | ) | (12,721 | ) | (11,292 | ) | (10,346 | ) |
| Loans, net | 1,165,767 |
| 1,132,914 |
| 1,112,775 |
| 990,353 |
| 913,423 |
|
| Premises and equipment, net | 18,869 |
| 18,788 |
| 18,616 |
| 18,209 |
| 18,281 |
|
| Accrued interest receivable | 4,793 |
| 4,433 |
| 4,367 |
| 4,127 |
| 3,906 |
|
| Goodwill and core deposit intangible | 12,955 |
| 13,392 |
| 13,854 |
| 14,361 |
| 14,870 |
|
| Net deferred tax asset | 5,172 |
| 6,233 |
| 4,456 |
| 1,020 |
| 1,859 |
|
| Bank-owned life insurance | 30,848 |
| 30,595 |
| 30,576 |
| 30,326 |
| 30,080 |
|
| Other assets | 23,535 |
| 18,907 |
| 16,775 |
| 16,102 |
| 12,816 |
|
| Total assets | $ | 1,757,884 |
| $ | 1,728,148 |
| $ | 1,686,611 |
| $ | 1,823,105 |
| $ | 1,499,527 |
|
| Liabilities and Stockholders' Equity | | | | | |
| NOW and demand | $ | 256,746 |
| $ | 245,117 |
| $ | 252,439 |
| $ | 237,586 |
| $ | 242,544 |
|
| Regular savings | 301,932 |
| 303,834 |
| 318,557 |
| 343,697 |
| 351,040 |
|
| Money market | 269,164 |
| 280,139 |
| 233,392 |
| 195,264 |
| 195,713 |
|
| Certificates of deposit | 310,672 |
| 301,755 |
| 289,384 |
| 293,516 |
| 306,759 |
|
| Brokered money market | 23,991 |
| 23,166 |
| — |
| — |
| — |
|
| Brokered certificates of deposit | 58,705 |
| 58,705 |
| 58,705 |
| 81,205 |
| 20,705 |
|
| Total deposits | 1,221,210 |
| 1,212,716 |
| 1,152,477 |
| 1,151,268 |
| 1,116,761 |
|
| Stock subscriptions | — |
| — |
| — |
| 283,958 |
| — |
|
| Short-term borrowings | 70,000 |
| 40,000 |
| 75,000 |
| 160,000 |
| 150,000 |
|
| Long-term debt | 35,000 |
| 35,000 |
| 35,000 |
| 35,000 |
| 45,000 |
|
| Other liabilities | 16,730 |
| 28,826 |
| 14,068 |
| 16,724 |
| 14,601 |
|
| Total liabilities | 1,342,940 |
| 1,316,542 |
| 1,276,545 |
| 1,646,950 |
| 1,326,362 |
|
| Preferred stock | — |
| — |
| — |
| 18,724 |
| 18,724 |
|
| Common stock | 285 |
| 285 |
| 285 |
| — |
| — |
|
| Additional paid-in capital | 281,094 |
| 281,035 |
| 280,926 |
| — |
| — |
|
| Unearned compensation- ESOP | (21,825 | ) | (22,014 | ) | (22,393 | ) | — |
| — |
|
| Retained earnings | 151,029 |
| 149,723 |
| 146,979 |
| 149,959 |
| 149,742 |
|
| Accumulated other comprehensive income | 4,361 |
| 2,577 |
| 4,269 |
| 7,472 |
| 4,699 |
|
| Total stockholders' equity | 414,944 |
| 411,606 |
| 410,066 |
| 176,155 |
| 173,165 |
|
| Total liabilities and stockholders' equity | $ | 1,757,884 |
| $ | 1,728,148 |
| $ | 1,686,611 |
| $ | 1,823,105 |
| $ | 1,499,527 |
|
Blue Hills Bancorp, Inc.
Consolidated Statement of Operations-Quarters
|
| | | | | | | | | | | | | |
| (Dollars in thousands, except share data) | Quarters Ended | % Change |
| | March 31, 2015 | December 31, 2014 | March 31, 2014 | March 31, 2015 vs. December 31, 2014 | March 31, 2015 vs. March 31, 2014 |
| Interest and fees on loans | $ | 10,427 |
| $ | 10,207 |
| $ | 8,051 |
| 2.2 | % | 29.5 | % |
| Interest on securities | 2,136 |
| 2,027 |
| 1,937 |
| 5.4 | % | 10.3 | % |
| Dividends | 100 |
| 2,221 |
| 166 |
| (95.5 | )% | (39.8 | )% |
| Other | 19 |
| 30 |
| 15 |
| (36.7 | )% | 26.7 | % |
| Total interest and dividend income | 12,682 |
| 14,485 |
| 10,169 |
| (12.4 | )% | 24.7 | % |
| Interest on deposits | 1,763 |
| 1,675 |
| 1,351 |
| 5.3 | % | 30.5 | % |
| Interest on borrowings | 254 |
| 243 |
| 304 |
| 4.5 | % | (16.4 | )% |
| Total interest expense | 2,017 |
| 1,918 |
| 1,655 |
| 5.2 | % | 21.9 | % |
| Net interest and dividend income | 10,665 |
| 12,567 |
| 8,514 |
| (15.1 | )% | 25.3 | % |
| Provision for loan losses | 279 |
| 270 |
| 714 |
| 3.3 | % | (60.9 | )% |
| Net interest and dividend income, after provision for loan losses | 10,386 |
| 12,297 |
| 7,800 |
| (15.5 | )% | 33.2 | % |
| Deposit account fees | 333 |
| 342 |
| 291 |
| (2.6 | )% | 14.4 | % |
| Interchange and ATM fees | 326 |
| 351 |
| 285 |
| (7.1 | )% | 14.4 | % |
| Mortgage banking | 101 |
| 300 |
| 68 |
| (66.3 | )% | 48.5 | % |
| Loan level derivative income | 4 |
| 157 |
| 150 |
| (97.5 | )% | (97.3 | )% |
| Realized securities gains and impairment losses, net | 1,318 |
| 434 |
| 541 |
| 203.7 | % | 143.6 | % |
| Gain on trading assets, net | — |
| — |
| 25 |
| — | % | (100.0 | )% |
| Bank-owned life insurance income | 253 |
| 261 |
| 249 |
| (3.1 | )% | 1.6 | % |
| Bank-owned life insurance death benefit gains | — |
| 182 |
| — |
| (100.0 | )% | — | % |
| Miscellaneous | (151 | ) | 267 |
| 20 |
| (156.6 | )% | (855.0 | )% |
| Total noninterest income | 2,184 |
| 2,294 |
| 1,629 |
| (4.8 | )% | 34.1 | % |
| Salaries and employee benefits | 5,489 |
| 5,543 |
| 5,129 |
| (1.0 | )% | 7.0 | % |
| Occupancy and equipment | 1,498 |
| 1,256 |
| 1,601 |
| 19.3 | % | (6.4 | )% |
| Data processing | 819 |
| 878 |
| 605 |
| (6.7 | )% | 35.4 | % |
| Professional fees | 632 |
| 575 |
| 1,159 |
| 9.9 | % | (45.5 | )% |
| Advertising | 500 |
| 653 |
| 301 |
| (23.4 | )% | 66.1 | % |
| FDIC deposit insurance | 292 |
| 532 |
| 178 |
| (45.1 | )% | 64.0 | % |
| Directors' fees | 124 |
| 30 |
| 150 |
| 313.3 | % | (17.3 | )% |
| Amortization of core deposit intangible | 437 |
| 461 |
| 353 |
| (5.2 | )% | 23.8 | % |
| Other general and administrative | 835 |
| 814 |
| 780 |
| 2.6 | % | 7.1 | % |
| Total noninterest expense | 10,626 |
| 10,742 |
| 10,256 |
| (1.1 | )% | 3.6 | % |
| Income (loss) before income taxes | 1,944 |
| 3,849 |
| (827 | ) | (49.5 | )% | 335.1 | % |
| Provision (benefit) for income taxes | 638 |
| 1,104 |
| (428 | ) | (42.2 | )% | 249.1 | % |
| Net income (loss) | $ | 1,306 |
| $ | 2,745 |
| $ | (399 | ) | (52.4 | )% | 427.3 | % |
| | | | | | |
| Earnings per common share: | | | | | |
| Basic | $ | 0.05 |
| $ | 0.10 |
| n/a |
| n/a |
| n/a |
|
| Diluted | $ | 0.05 |
| $ | 0.10 |
| n/a |
| n/a |
| n/a |
|
| Weighted average shares outstanding: | | | | | |
| Basic | 26,274,738 |
| 26,243,957 |
| n/a |
| n/a |
| n/a |
|
| Diluted | 26,274,738 |
| 26,243,957 |
| n/a |
| n/a |
| n/a |
|
|
| | | | | | | | | | | | | | | |
| Blue Hills Bancorp Inc. |
| Consolidated Statements of Operations - Trend |
| | Quarters Ended |
| (Dollars in thousands, except share data) | March 31, | December 31, | September 30, | June 30, | March 31, |
| | 2015 | 2014 | 2014 | 2014 | 2014 |
| Interest and fees on loans | $ | 10,427 |
| $ | 10,207 |
| $ | 9,725 |
| $ | 9,399 |
| $ | 8,051 |
|
| Interest on securities | 2,136 |
| 2,027 |
| 1,892 |
| 2,003 |
| 1,937 |
|
| Dividends | 100 |
| 2,221 |
| 1,388 |
| 119 |
| 166 |
|
| Other | 19 |
| 30 |
| 65 |
| 30 |
| 15 |
|
| Total interest and dividend income | 12,682 |
| 14,485 |
| 13,070 |
| 11,551 |
| 10,169 |
|
| Interest on deposits | 1,763 |
| 1,675 |
| 1,376 |
| 1,348 |
| 1,351 |
|
| Interest on borrowings | 254 |
| 243 |
| 275 |
| 326 |
| 304 |
|
| Total interest expense | 2,017 |
| 1,918 |
| 1,651 |
| 1,674 |
| 1,655 |
|
| Net interest and dividend income | 10,665 |
| 12,567 |
| 11,419 |
| 9,877 |
| 8,514 |
|
| Provision for loan losses | 279 |
| 270 |
| 1,438 |
| 959 |
| 714 |
|
| Net interest and dividend income, after provision for loan losses | 10,386 |
| 12,297 |
| 9,981 |
| 8,918 |
| 7,800 |
|
| Deposit account fees | 333 |
| 342 |
| 337 |
| 343 |
| 291 |
|
| Interchange and ATM fees | 326 |
| 351 |
| 390 |
| 371 |
| 285 |
|
| Mortgage banking | 101 |
| 300 |
| 341 |
| 75 |
| 68 |
|
| Loan level derivative income | 4 |
| 157 |
| 296 |
| 57 |
| 150 |
|
| Realized securities gains and impairment losses, net | 1,318 |
| 434 |
| 349 |
| 1,191 |
| 541 |
|
| Gains on trading assets, net | — |
| — |
| — |
| — |
| 25 |
|
| Bank-owned life insurance income | 253 |
| 261 |
| 250 |
| 246 |
| 249 |
|
| Bank-owned life insurance death benefit gains | — |
| 182 |
| — |
| — |
| — |
|
| Pension curtailment gain | — |
| — |
| 1,304 |
| — |
| — |
|
| Miscellaneous | (151 | ) | 267 |
| 107 |
| 27 |
| 20 |
|
| Total noninterest income | 2,184 |
| 2,294 |
| 3,374 |
| 2,310 |
| 1,629 |
|
| Salaries and employee benefits | 5,489 |
| 5,543 |
| 5,424 |
| 5,212 |
| 5,129 |
|
| Occupancy and equipment | 1,498 |
| 1,256 |
| 1,150 |
| 1,298 |
| 1,601 |
|
| Data processing | 819 |
| 878 |
| 805 |
| 701 |
| 605 |
|
| Professional fees | 632 |
| 575 |
| 694 |
| 1,123 |
| 1,159 |
|
| Advertising | 500 |
| 653 |
| 815 |
| 658 |
| 301 |
|
| FDIC deposit insurance | 292 |
| 532 |
| 360 |
| 196 |
| 178 |
|
| Directors' fees | 124 |
| 30 |
| 150 |
| 156 |
| 150 |
|
| Amortization of core deposit intangible | 437 |
| 461 |
| 485 |
| 509 |
| 353 |
|
| Charitable Foundation contribution | — |
| — |
| 7,000 |
| — |
| — |
|
| Other general and administrative | 835 |
| 814 |
| 865 |
| 809 |
| 780 |
|
| Total noninterest expense | 10,626 |
| 10,742 |
| 17,748 |
| 10,662 |
| 10,256 |
|
| Income (loss) before income taxes | 1,944 |
| 3,849 |
| (4,393 | ) | 566 |
| (827 | ) |
| Provision (benefit) for income taxes | 638 |
| 1,104 |
| (1,435 | ) | 137 |
| (428 | ) |
| Net income (loss) | $ | 1,306 |
| $ | 2,745 |
| $ | (2,958 | ) | $ | 429 |
| $ | (399 | ) |
| | | | | | |
| Earnings per common share: | | | | | |
| Basic | $ | 0.05 |
| $ | 0.10 |
| n/a |
| n/a |
| n/a |
|
| Diluted | $ | 0.05 |
| $ | 0.10 |
| n/a |
| n/a |
| n/a |
|
| Weighted average shares outstanding: | | | | | |
| Basic | 26,274,738 |
| 26,243,957 |
| n/a |
| n/a |
| n/a |
|
| Diluted | 26,274,738 |
| 26,243,957 |
| n/a |
| n/a |
| n/a |
|
|
| | | | | | | | | | | | | | | | | | | | | | | | | | |
| Blue Hills Bancorp Inc. |
| Average Balances/Yields |
| (Dollars in thousands) | Quarters Ended |
| | March 31, 2015 | | December 31, 2014 | | March 31, 2014 |
| | Average balance | Interest | Yield/Cost | | Average balance | Interest | Yield/Cost | | Average balance | Interest | Yield/Cost |
| Interest-earning assets | | | | | | | | | | | |
| Total loans | $ | 1,178,716 |
| $ | 10,427 |
| 3.59 | % | | $ | 1,148,744 |
| $ | 10,207 |
| 3.53 | % | | $ | 880,754 |
| $ | 8,051 |
| 3.71 | % |
| Securities | 422,092 |
| 2,185 |
| 2.10 |
| | 416,867 |
| 4,205 |
| 4.00 |
| | 443,084 |
| 2,066 |
| 1.89 |
|
| Other interest earning assets and FHLB stock | 50,603 |
| 70 |
| 0.56 |
| | 59,028 |
| 73 |
| 0.49 |
| | 46,176 |
| 52 |
| 0.46 |
|
| Total interest-earning assets | 1,651,411 |
| 12,682 |
| 3.11 | % | | 1,624,639 |
| 14,485 |
| 3.54 | % | | 1,370,014 |
| 10,169 |
| 3.01 | % |
| Non-interest-earning assets | 97,427 |
| | | | 92,241 |
| | | | 71,684 |
| | |
| Total assets | $ | 1,748,838 |
| | | | $ | 1,716,880 |
| | | | $ | 1,441,698 |
| | |
| | | | | | | | | | | | |
| Interest-bearing liabilities | | | | | | | | | | | |
| NOW | $ | 122,226 |
| $ | 14 |
| 0.05 | % | | $ | 136,210 |
| $ | 31 |
| 0.09 | % | | $ | 114,927 |
| $ | 21 |
| 0.07 | % |
| Regular savings | 301,135 |
| 319 |
| 0.43 |
| | 310,591 |
| 342 |
| 0.44 |
| | 350,377 |
| 354 |
| 0.41 |
|
| Money market | 297,359 |
| 508 |
| 0.69 |
| | 279,622 |
| 469 |
| 0.67 |
| | 170,283 |
| 209 |
| 0.50 |
|
| Certificates of deposit | 353,480 |
| 922 |
| 1.06 |
| | 356,255 |
| 833 |
| 0.93 |
| | 355,463 |
| 767 |
| 0.88 |
|
| Total interest-bearing deposits | 1,074,200 |
| 1,763 |
| 0.67 |
| | 1,082,678 |
| 1,675 |
| 0.61 |
| | 991,050 |
| 1,351 |
| 0.55 |
|
| Borrowings | 108,556 |
| 254 |
| 0.95 |
| | 83,054 |
| 243 |
| 1.16 |
| | 165,333 |
| 304 |
| 0.75 |
|
| Total interest-bearing liabilities | 1,182,756 |
| 2,017 |
| 0.69 | % | | 1,165,732 |
| 1,918 |
| 0.65 | % | | 1,156,383 |
| 1,655 |
| 0.58 | % |
| Non-interest-bearing deposits | 125,915 |
| | | | 122,263 |
| | | | 96,193 |
| | |
| Other non-interest-bearing liabilities | 25,681 |
| | | | 16,876 |
| | | | 15,682 |
| | |
| Total liabilities | 1,334,352 |
| | | | 1,304,871 |
| | | | 1,268,258 |
| | |
| Stockholders' equity | 414,486 |
| | | | 412,009 |
| | | | 173,440 |
| | |
| Total liabilities and stockholders' equity | $ | 1,748,838 |
| | | | $ | 1,716,880 |
| | | | $ | 1,441,698 |
| | |
| | | | | | | | | | | | |
| Net interest and dividend income | | $ | 10,665 |
| | | | $ | 12,567 |
| | | | $ | 8,514 |
| |
| Net interest rate spread | | | 2.42 | % | | | | 2.89 | % | | | | 2.43 | % |
| Net interest margin | | | 2.62 | % | | | | 3.07 | % | | | | 2.52 | % |
| Total deposit cost | | | 0.60 | % | | | | 0.55 | % | | | | 0.50 | % |
|
| | | | | | | | | | | | | | | |
| Blue Hills Bancorp, Inc. |
| Average Balances - Trend |
| | Quarters ended |
| (Dollars in thousands) | March 31, | December 31, | September 30, | June 30, | March 31, |
| | 2015 | 2014 | 2014 | 2014 | 2014 |
| Interest-earning assets | | | | | |
| Total loans | $ | 1,178,716 |
| $ | 1,148,744 |
| $ | 1,085,951 |
| $ | 969,417 |
| $ | 880,754 |
|
| Securities | 422,092 |
| 416,867 |
| 414,864 |
| 422,335 |
| 443,084 |
|
| Other interest earning assets and FHLB stock | 50,603 |
| 59,028 |
| 113,163 |
| 94,149 |
| 46,176 |
|
| Total interest-earning assets | 1,651,411 |
| 1,624,639 |
| 1,613,978 |
| 1,485,901 |
| 1,370,014 |
|
| Non-interest-earning assets | 97,427 |
| 92,241 |
| 91,717 |
| 90,026 |
| 71,684 |
|
| Total assets | $ | 1,748,838 |
| $ | 1,716,880 |
| $ | 1,705,695 |
| $ | 1,575,927 |
| $ | 1,441,698 |
|
| | | | | | |
| Interest-bearing liabilities | | | | | |
| NOW | $ | 122,226 |
| $ | 136,210 |
| $ | 124,846 |
| $ | 121,263 |
| $ | 114,927 |
|
| Regular savings | 301,135 |
| 310,591 |
| 336,151 |
| 345,837 |
| 350,377 |
|
| Money market | 297,359 |
| 279,622 |
| 197,500 |
| 191,972 |
| 170,283 |
|
| Certificates of deposit | 353,480 |
| 356,255 |
| 346,807 |
| 359,668 |
| 355,463 |
|
| Total interest-bearing deposits | 1,074,200 |
| 1,082,678 |
| 1,005,304 |
| 1,018,740 |
| 991,050 |
|
| Borrowings | 108,556 |
| 83,054 |
| 145,848 |
| 206,077 |
| 165,333 |
|
| Total interest-bearing liabilities | 1,182,756 |
| 1,165,732 |
| 1,151,152 |
| 1,224,817 |
| 1,156,383 |
|
| Non-interest-bearing deposits | 125,915 |
| 122,263 |
| 117,393 |
| 112,849 |
| 96,193 |
|
| Other non-interest-bearing liabilities | 25,681 |
| 16,876 |
| 78,377 |
| 63,496 |
| 15,682 |
|
| Total liabilities | 1,334,352 |
| 1,304,871 |
| 1,346,922 |
| 1,401,162 |
| 1,268,258 |
|
| Stockholders' equity | 414,486 |
| 412,009 |
| 358,773 |
| 174,765 |
| 173,440 |
|
| Total liabilities and stockholders' equity | $ | 1,748,838 |
| $ | 1,716,880 |
| $ | 1,705,695 |
| $ | 1,575,927 |
| $ | 1,441,698 |
|
|
| | | | | |
| Blue Hills Bancorp, Inc. |
| Yield Trend |
| | Quarters Ended |
| | March 31, | December 31, | September 30, | June 30, | March 31, |
| | 2015 | 2014 | 2014 | 2014 | 2014 |
| Interest-earning assets | | | | | |
| Total loans | 3.59% | 3.53% | 3.55% | 3.89% | 3.71% |
| Securities | 2.10% | 4.00% | 3.10% | 1.98% | 1.89% |
| Other interest earning assets and FHLB stock | 0.56% | 0.49% | 0.38% | 0.30% | 0.46% |
| Total interest-earning assets | 3.11% | 3.54% | 3.21% | 3.12% | 3.01% |
| | | | | | |
| Interest-bearing liabilities | | | | | |
| NOW | 0.05% | 0.09% | 0.06% | 0.06% | 0.07% |
| Regular savings | 0.43% | 0.44% | 0.42% | 0.38% | 0.41% |
| Money market | 0.69% | 0.67% | 0.54% | 0.52% | 0.50% |
| Certificates of deposit | 1.06% | 0.93% | 0.83% | 0.84% | 0.88% |
| Total interest-bearing deposits | 0.67% | 0.61% | 0.54% | 0.53% | 0.55% |
| Borrowings | 0.95% | 1.16% | 0.75% | 0.63% | 0.75% |
| Total interest-bearing liabilities | 0.69% | 0.65% | 0.57% | 0.55% | 0.58% |
| | | | | | |
| Net interest rate spread | 2.42% | 2.89% | 2.64% | 2.57% | 2.43% |
| Net interest margin | 2.62% | 3.07% | 2.81% | 2.67% | 2.52% |
| Total deposit cost | 0.60% | 0.55% | 0.49% | 0.48% | 0.50% |
| | | | | | |
| No tax equivalent yield adjustments have been made as the effect of such adjustments would not be material. |
|
| | | | | | | | | | | | | | | |
| Blue Hills Bancorp Inc. |
| Reconciliation of GAAP to Non-GAAP Net Income (Loss) |
| | | Quarters Ended |
| (Dollars in thousands) | March 31, | December 31, | September 30, | June 30, | March 31, |
| | 2015 | 2014 | 2014 | 2014 | 2014 |
| | | | | | |
| Net income (loss)-GAAP basis | $ | 1,306 |
| $ | 2,745 |
| $ | (2,958 | ) | $ | 429 |
| $ | (399 | ) |
| Noninterest income adjustments: | | | | | |
| Less gain on bank-owned life insurance death benefits | — |
| (182 | ) | — |
| — |
| — |
|
| Less pension curtailment gain | — |
| — |
| (1,304 | ) | — |
| — |
|
| Noninterest expense adjustments: | | | | | |
| Add Nantucket Bank acquisition expenses | — |
| — |
| 2 |
| 173 |
| 775 |
|
| Add expenses related to mutual to stock conversion | — |
| — |
| 51 |
| 330 |
| 488 |
|
| Add Charitable Foundation contribution | — |
| — |
| 7,000 |
| — |
| — |
|
| Income tax effects | — |
| — |
| (1,955 | ) | (171 | ) | (429 | ) |
| Net income-Non-GAAP basis | $ | 1,306 |
| $ | 2,563 |
| $ | 836 |
| $ | 761 |
| $ | 435 |
|
The Company’s management believes that the presentation of net income on a non-GAAP basis excluding nonrecurring items provides useful information for evaluating the Company’s operating results and any related trends that may be affecting the Company’s business. These disclosures should not be viewed as a substitute for operating results determined in accordance with GAAP.
|
| | | | | | | | | | | | |
| Blue Hills Bancorp, Inc. |
| Selected Financial Highlights |
| | Quarters Ended |
| (Dollars in thousands, except share data) | March 31, | December 31, | September 30, | June 30, | March 31, |
| | 2015 | 2014 | 2014 | 2014 | 2014 |
| Performance Ratios (annualized) | | | | | |
| Basic and diluted EPS | | | | | |
| GAAP | $ | 0.05 |
| $ | 0.10 |
| n/a | n/a | n/a |
| Non-GAAP(1) | $ | 0.05 |
| $ | 0.10 |
| n/a | n/a | n/a |
| Return (loss) on average assets (ROAA): | | | | | |
| GAAP | 0.30 | % | 0.63 | % | (0.69 | )% | 0.11 | % | (0.11 | )% |
| Non-GAAP(1) | 0.30 | % | 0.59 | % | 0.19 | % | 0.19 | % | 0.12 | % |
| Return (loss) on average equity (ROAE): | | | | | |
| GAAP | 1.28 | % | 2.64 | % | (3.27 | )% | 0.98 | % | (0.93 | )% |
| Non-GAAP(1) | 1.28 | % | 2.47 | % | 0.92 | % | 1.75 | % | 1.02 | % |
| Return (loss) on average tangible common equity (ROATCE): | | | | | |
| GAAP | 1.32 | % | 2.73 | % | (3.53 | )% | 1.21 | % | (1.12 | )% |
| Non-GAAP(1) | 1.32 | % | 2.55 | % | 1.00 | % | 2.14 | % | 1.22 | % |
| Efficiency Ratio: | | | | | |
| GAAP | 83 | % | 72 | % | 120 | % | 87 | % | 101 | % |
| Non-GAAP(1) | 83 | % | 73 | % | 79 | % | 83 | % | 89 | % |
(1) See page 12 for a reconciliation of Non-GAAP financial measures
|
| | | | | | | | | |
| At or for the Quarters Ended |
| | March 31, | December 31, | March 31, |
| | 2015 | 2014 | 2014 |
| Asset Quality | | | |
| Nonperforming Assets | $ | 4,766 |
| $ | 4,481 |
| $ | 3,857 |
|
| Nonperforming Assets/Total Assets | 0.27 | % | 0.26 | % | 0.26 | % |
| Allowance for Loan Losses/Total Loans | 1.12 | % | 1.13 | % | 1.12 | % |
| Net Chargeoffs (Recoveries) | $ | 14 |
| $ | 19 |
| $ | 39 |
|
| Annualized Chargeoffs Net (Recoveries)/Average Loans | — | % | — | % | 0.02 | % |
| Allowance for Loan Losses/ Nonperforming Loans | 278 | % | 290 | % | 268 | % |
| | | | |
| Capital/Other | | | |
| Common shares outstanding | 28,466,813 |
| 28,466,813 |
| n/a |
|
| Book value per share | $ | 14.58 |
| $ | 14.46 |
| n/a |
|
| Tangible book value per share | $ | 14.12 |
| $ | 13.99 |
| n/a |
|
| Tangible Common Equity/Tangible Assets | 23.04 | % | 23.22 | % | 9.40 | % |
| Full-time Equivalent Employees | 204 |
| 202 |
| 200 |
|
