The Bank of N.T. Butterfield & Son Limited (NTB)
Filed: 4 Aug 16, 12:00am
Wachtell, Lipton, Rosen & Katz
MARTIN LIPTON | DAVID M. SILK |
| 51 WEST 52ND STREET |
| IGOR KIRMAN | JOSHUA A. FELTMAN | ||
HERBERT M. WACHTELL | ROBIN PANOVKA |
| NEW YORK, N.Y. 10019-6150 |
| JONATHAN M. MOSES | ELAINE P. GOLIN | ||
PAUL VIZCARRONDO, JR. | DAVID A. KATZ |
| TELEPHONE: (212) 403 -1000 |
| T. EIKO STANGE | EMIL A. KLEINHAUS | ||
PETER C. HEIN | ILENE KNABLE GOTTS |
| FACSIMILE: (212) 403 -2000 |
| DAVID A. SCHWARTZ | KARESSA L. CAIN | ||
HAROLD S. NOVIKOFF | JEFFREY M. WINTNER |
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| JOHN F. LYNCH | RONALD C. CHEN | ||
THEODORE N. MIRVIS | TREVOR S. NORWITZ |
| GEORGE A. KATZ (1965-1989) |
| WILLIAM SAVITT | GORDON S. MOODIE | ||
EDWARD D. HERLIHY | BEN M. GERMANA |
| JAMES H. FOGELSON (1967-1991) |
| ERIC M. ROSOF | DONGJU SONG | ||
DANIEL A. NEFF | ANDREW J. NUSSBAUM |
| LEONARD M. ROSEN (1965-2014) |
| MARTIN J.E. ARMS | BRADLEY R. WILSON | ||
ANDREW R. BROWNSTEIN | RACHELLE SILVERBERG |
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| GREGORY E. OSTLING | GRAHAM W. MELI | ||
PAUL K. ROWE | STEVEN A. COHEN |
| OF COUNSEL |
| DAVID B. ANDERS | GREGORY E. PESSIN | ||
MARC WOLINSKY | DEBORAH L. PAUL |
| ANDREA K. WAHLQUIST | CARRIE M. REILLY | ||||
DAVID GRUENSTEIN | DAVID C. KARP |
| WILLIAM T. ALLEN |
| DAVID M. MURPHY |
| ADAM J. SHAPIRO | MARK F. VEBLEN |
STEVEN A. ROSENBLUM | RICHARD K. KIM |
| MICHAEL H. BYOWITZ |
| DAVID S. NEILL |
| NELSON O. FITTS | VICTOR GOLDFELD |
JOHN F. SAVARESE | JOSHUA R. CAMMAKER |
| PETER C. CANELLOS |
| BERNARD W. NUSSBAUM |
| JOSHUA M. HOLMES | EDWARD J. LEE |
SCOTT K. CHARLES | MARK GORDON |
| DAVID M. EINHORN |
| LAWRENCE B. PEDOWITZ |
| DAVID E. SHAPIRO | BRANDON C. PRICE |
JODI J. SCHWARTZ | JOSEPH D. LARSON |
| KENNETH B. FORREST |
| ERIC S. ROBINSON |
| DAMIAN G. DIDDEN | KEVIN S. SCHWARTZ |
ADAM O. EMMERICH | LAWRENCE S. MAKOW |
| THEODORE GEWERTZ |
| PATRICIA A. ROBINSON* |
| IAN BOCZKO | MICHAEL S. BENN |
GEORGE T. CONWAY III | JEANNEMARIE O’BRIEN |
| MAURA R. GROSSMAN |
| ERIC M. ROTH |
| MATTHEW M. GUEST | SABASTIAN V. NILES |
RALPH M. LEVENE | WAYNE M. CARLIN |
| RICHARD D. KATCHER |
| MICHAEL W. SCHWARTZ |
| DAVID E. KAHAN | ALISON ZIESKE PREISS |
RICHARD G. MASON | STEPHEN R. DiPRIMA |
| MEYER G. KOPLOW |
| STEPHANIE J. SELIGMAN |
| DAVID K. LAM |
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MICHAEL J. SEGAL | NICHOLAS G. DEMMO |
| DOUGLAS K. MAYER |
| ELLIOTT V. STEIN |
| BENJAMIN M. ROTH |
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| ROBERT B. MAZUR |
| WARREN R. STERN |
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| MARSHALL L. MILLER |
| PATRICIA A. VLAHAKIS |
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| PHILIP MINDLIN |
| ANTE VUCIC |
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| ROBERT M. MORGENTHAU |
| AMY R. WOLF |
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| DAVID M. ADLERSTEIN |
| PAULA N. GORDON |
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| AMANDA K. ALLEXON |
| NANCY B. GREENBAUM |
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| LOUIS J. BARASH |
| MARK A. KOENIG |
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| FRANCO CASTELLI |
| LAUREN M. KOFKE |
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| DIANNA CHEN |
| J. AUSTIN LYONS |
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| ANDREW J.H. CHEUNG |
| ALICIA C. McCARTHY |
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| PAMELA EHRENKRANZ |
| AMANDA N. PERSAUD |
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| UMUT ERGUN |
| S. CHRISTOPHER SZCZERBAN |
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| KATHRYN GETTLES-ATWA |
| JEFFREY A. WATIKER |
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| ADAM M. GOGOLAK |
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August 4, 2016
VIA EDGAR AND FEDERAL EXPRESS
Mr. Christian N. Windsor
Division of Corporation Finance
U.S. Securities and Exchange Commission
100 F. Street, N.W.
Washington, DC 20549
Re: The Bank of N.T. Butterfield & Son Limited
Amendment No. 1 to
Draft Registration Statement on Form F-1
Submitted July 7, 2016
CIK No. 0001653242
Dear Mr. Windsor:
On behalf of The Bank of N.T. Butterfield & Son Limited, a Bermuda company (the “Company”), we are submitting this letter in response to comments from the staff (the “Staff”) of the Securities and Exchange Commission (the “Commission”) received by letter dated July 21, 2016 (the “Comment Letter”) relating to the above-referenced submission (the “Confidential Submission”). The Company is concurrently filing a Registration Statement on Form F-1 (the “Registration Statement”) via EDGAR, and five courtesy copies of the
Mr. Christian N. Windsor
August 4, 2016
Page 2
Registration Statement marked to show changes to the Confidential Submission are being sent to the Staff under separate cover.
For the convenience of the Staff, each of the Staff’s comments is reproduced below in bold and is followed by the corresponding response of the Company. Unless otherwise indicated, capitalized terms used herein have the meanings assigned to them in the Registration Statement. All page references in the responses set forth below refer to pages of the Registration Statement.
Prospectus Summary, page 1
Overview, page 1
1. We note your charts presenting your “Core Net Income to Common” and “Core Earnings per Common Share Fully Diluted” on pages 3 and 81. We also note your charts presenting “Core ROATCE” on pages 10 and 88. These presentations appear to give undue prominence to these non-GAAP measures as they are not balanced with the presentation of your comparable GAAP measures for the periods presented. Refer to Question 102.10 of the Non-GAAP Compliance and Disclosure Interpretations, available on our website at http://www.sec.gov/divisions/corpfin/guidance/ nongaapinterp.htm, and revise your presentation accordingly.
Response: In response to the Staff’s comment, pages 3, 11, 85 and 93 of the Registration Statement have been revised.
A decline in the residential real estate market, in particular in Bermuda, could increase the risk of loans being impaired…, page 27
2. We note your revised disclosure in response to comment 20 that indices for the value of residential real estate did not exist in Bermuda, the UK or the Cayman Islands. Revise this risk factor, or add a separate risk factor, that discusses the risks to investors from the fact that you do not have a mechanism to value the overall real estate market in your key business areas, and therefore must rely on observations of the valuation of your own real estate originations in order to assess whether the value of mortgaged real estate has declined.
Response: In response to the Staff’s comment, pages 28 - 29 of the Registration Statement have been revised.
Reconciliation of Non-GAAP Financial Measures, page 69
3. We note your response to prior comment 6 of our letter dated June 16, 2016 and your revised disclosures related to your non-GAAP adjustments. A number of the adjustments are characterized as “non-recurring” or “individually non-recurring,” even though some
Mr. Christian N. Windsor
August 4, 2016
Page 3
of these adjustments do not meet the characteristics of non-recurring provided in Item 10(e)(1)(ii)(B) of Regulation S-K as they are likely to recur in the next two years or there was a similar adjustment within the prior two years. Therefore, please revise your descriptions of such adjustments to comply with the guidance of Regulation 10(e). Refer also to Non-GAAP Compliance and Disclosure Interpretations Question 102.03.
Response: In response to the Staff’s comment, pages 70 and 74 - 75 of the Registration Statement have been revised.
Earnings Upside Potential, page 89
4. In this section you discuss the potential positive impact on your business from an increase in market interest rates. It also appears that, world-wide, interest rates have trended downward, with some nations borrowing at negative rates. Revise this section to discuss the impact on your earnings from a continuation of the low-rate environment, and also the impact of lowered rates over the short term upon your earnings. Make similar revisions to your disclosure on page 10. Also, revise this section to discuss the extent to which management believes that some of your non-interest bearing deposits might withdraw in search of more yield in the event that rates did increase.
Response: In response to the Staff’s comment, pages 11 - 12 and 93 of the Registration Statement have been revised.
5. Please tell us, with a view towards revised disclosure, whether management has identified any specific acquisition targets, particularly in the wealth management area.
Response: The Company supplementally advises the Staff that, from time to time, the Company identifies potential acquisition targets in connection with its growth and development strategy, and the Company may engage in informal discussions with potential acquisition targets. Any potential acquisition target is determined with reference to the Company’s board of directors’ approved corporate development framework, which operates within a closely monitored risk appetite. The Company further advises the Staff that it has not, to date, engaged in any substantive discussions with respect to any potential acquisitions that are reasonably expected to lead to a transaction that is expected to be material to the Company.
* * *
If you have any questions, please do not hesitate to contact the undersigned at (212) 403-1155.
| Very truly yours, |
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| /s/ Edward J. Lee |
| Edward J. Lee |
Mr. Christian N. Windsor
August 4, 2016
Page 4
Enclosure
cc: E. Barclay Simmons (The Bank of N.T. Butterfield & Son Limited)
Shaun Morris (The Bank of N.T. Butterfield & Son Limited)
John B. Meade (Davis Polk & Wardwell LLP)