Exhibit 99.1
Bar Harbor Bankshares Reports Strong Second Quarter Results
While Completing Systems Conversion
BAR HARBOR, MAINE - July 27, 2017 -- Bar Harbor Bankshares (NYSE: BHB) reported second quarter 2017 net income of $6.6 million, or 42 cents per share. Core earnings totaled $8.1 million, or 52 cents per share. Net income increased 56% over the prior quarter and core earnings increased 21% reflecting the strength of the expanded operations. Merger-related and systems conversion costs in the second quarter of 2017 totaled $0.10 per share (after-tax).
SECOND QUARTER FINANCIAL HIGHLIGHTS (comparisons are to prior quarter unless otherwise stated):
| • | 11% increase in net interest income |
| • | 10% increase in fee income |
| • | 20 bps improvement in core ROA to .94% (non-GAAP measure) |
| • | 56.0% efficiency ratio (non-GAAP measure) |
| • | 7.1% annualized deposit growth |
| • | 0.22% non-performing loans to total loans |
President and Chief Executive Officer, Curtis C. Simard stated, “The second quarter results are reflective of the momentum and drive we experienced across all our markets. We remain focused on executing profitability strategies while maintaining our commitment to our communities. Not only did we experience strong and disciplined improvement in all performance metrics, we successfully completed our systems conversion on time and according to plan. This has been an active quarter in every way, and I am proud of what our teams have accomplished. It is a direct reflection of our commitment and what defines our culture.”
Mr. Simard further stated “We continue to strengthen our balance sheet by delivering positive operating leverage through revenue diversification and maximizing operational efficiencies. All the while, our commitment to credit risk and asset quality remains a top priority as the second quarter ratio of non-performing loans to total loans came in at a mere 22 basis points.”
RESULTS OF OPERATIONS
GAAP earnings increased to $6.6 million in the second quarter from $4.2 million in the linked quarter driven by higher interest income and fee income, and lower merger related expenses. Core income, which is a non-GAAP measure excluding tax-effected acquisition and system related costs, was $8.1 million in the second quarter compared to $6.2 million in the prior quarter. Second quarter earnings includes a full quarter earnings from the Lake Sunapee Bank Group merger that closed on January 13, 2017. Net interest
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income was affected positively by a 6 basis point increase in net interest spread. The yield on earning assets also benefited from purchase loan accretion.
Total non-interest income increased $0.5 million to $6.6 million compared to $5.9 million in the prior quarter. Trust and investment management fees increased $0.5 million in the current quarter as we continue to leverage the expanded operations from the merger. Customer service fees increased $0.6 million compared to the prior quarter as a result of a higher number of ATM transactions and a full quarter impact from the acquired operations.
Non-interest expense decreased $0.8 million in the current quarter primarily due to lower merger related and system conversion costs. The efficiency ratio (a non-GAAP financial measure) was 56.0% compared to 63.0% in the prior quarter and 60.0% in the second quarter of 2016. This decrease reflects disciplined cost control and execution against anticipated cost saves with the acquisition.
The effective tax was 31.6% in the second quarter compared to 26.0% in the first quarter, reflecting higher pretax income. The first quarter also benefited from a merger related discrete tax adjustment that reduced the quarterly rate based on the revaluation of the Company’s net deferred tax assets to the New Hampshire state rate.
FINANCIAL CONDITION
Total assets measured $3.5 billion at June 30, 2017. While total loan growth was relatively flat due to a large commercial real estate loan payoff just prior to quarter end, total average balances increased for the quarter. Commercial and industrial product lines increased 46.3% from the prior quarter, which are generally variable rate in nature and are favorable in the current interest rate environment.
The Company’s book value per share increased to $22.53 from $22.17 in the first quarter while tangible book value per share, a non-GAAP financial measure, increased to $15.44 from $15.07. The loan to deposit ratio improved to 107% from 109% in the prior quarter primarily due to growth in time deposits as we continue to leverage and deepen the expanded customer base. Asset quality continues to be strong as the ratio of non-accruing loans to total loans decreased to 0.22% from 0.25% in the previous quarter and net charge-offs to total loans remains close to zero at 0.03%.
BACKGROUND
Bar Harbor Bankshares (NYSE MKT: BHB) is the parent company of its wholly owned subsidiary, Bar Harbor Bank & Trust. Founded in 1887, Bar Harbor Bank & Trust is a true community bank serving the financial needs of its clients for over 125 years. Bar Harbor provides full service community banking with office locations in all three Northern New England states of Maine, New Hampshire and Vermont. For more information, visit www.bhbt.com.
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FORWARD LOOKING STATEMENTS
This document contains forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. There are several factors that could cause actual results to differ significantly from expectations described in the forward-looking statements. For a discussion of such factors, please see the Company’s most recent reports on Forms 10-K and 10-Q filed with the Securities and Exchange Commission and available on the SEC’s website at www.sec.gov. The Company does not undertake any obligation to update forward-looking statements.
NON-GAAP FINANCIAL MEASURES
This document contains certain non-GAAP financial measures in addition to results presented in accordance with Generally Accepted Accounting Principles (“GAAP”). These non-GAAP measures provide supplemental perspectives on operating results, performance trends, and financial condition. They are not a substitute for GAAP measures; they should be read and used in conjunction with the Company’s GAAP financial information. A reconciliation of non-GAAP financial measures to GAAP measures is included beginning on page J in the accompanying financial tables. In all cases, it should be understood that non-GAAP per share measures do not depict amounts that accrue directly to the benefit of shareholders.
The Company utilizes the non-GAAP measure of core earnings in evaluating operating trends, including components for core revenue and expense. These measures exclude items which the Company does not view as related to its normalized operations. These items include securities gains/losses, merger costs, restructuring costs, and systems conversion costs. Non-core adjustments are presented net of an adjustment for income tax expense. This adjustment is determined as the difference between the GAAP tax rate and the effective tax rate applicable to core income. The efficiency ratio is adjusted for non-core revenue and expense items and for tax preference items. The Company also calculates measures related to tangible equity, which adjust equity (and assets where applicable) to exclude intangible assets due to the importance of these measures to the investment community. Charges related to merger of Lake Sunapee Bank Group consists primarily of severance and retention cost, systems conversion and integration costs, and professional fees. The Company’s disclosure of organic growth of loans in 2017 is also adjusted for the Lake Sunapee Bank Group merger.
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CONTACTS
Josephine Iannelli; EVP, Chief Financial Officer & Treasurer; (207) 288-3314
Marsha Sawyer; EVP, Investor Relations; (207) 288-3314
TABLE INDEX | CONSOLIDATED FINANCIAL SCHEDULES (UNAUDITED) |
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| BAR HARBOR BANKSHARES | ||||||||||||||||||||
| SELECTED FINANCIAL HIGHLIGHTS - UNAUDITED | ||||||||||||||||||||
| At or for the Quarters Ended (1)(3) | ||||||||||||||||||||
| Jun 30, 2017 (3) | Mar 31, 2017 | Dec 31, 2016 | Sep 30, 2016 | Jun 30, 2016 | ||||||||||||||||
| PER SHARE DATA | ||||||||||||||||||||
| Net earnings, diluted | $ | 0.42 | $ | 0.29 | $ | 0.28 | $ | 0.40 | $ | 0.47 | ||||||||||
| Core earnings, diluted (1) (2) | 0.52 | 0.43 | 0.41 | 0.34 | 0.39 | |||||||||||||||
| Total book value | 22.53 | 22.17 | 17.19 | 18.09 | 18.27 | |||||||||||||||
| Tangible book value (2) | 15.44 | 15.07 | 16.61 | 17.51 | 17.67 | |||||||||||||||
| Market price at period end | 30.82 | 33.08 | 31.55 | 24.48 | 23.40 | |||||||||||||||
| Dividends | 0.187 | 0.187 | 0.187 | 0.183 | 0.180 | |||||||||||||||
PERFORMANCE RATIOS | ||||||||||||||||||||
| Return on assets | 0.76 | % | 0.50 | % | 0.59 | % | 0.86 | % | 1.04 | % | ||||||||||
| Core return on assets (1) (2) | 0.94 | 0.74 | 0.87 | 0.73 | 0.85 | |||||||||||||||
| Return on equity | 7.55 | 5.34 | 6.36 | 8.78 | 10.67 | |||||||||||||||
| Core return on equity (1) (2) | 9.32 | 7.88 | 9.34 | 7.49 | 8.72 | |||||||||||||||
| Core return on tangible equity (1) (2) | 13.78 | 12.24 | 9.66 | 7.75 | 9.03 | |||||||||||||||
| Net interest margin, fully taxable equivalent (FTE) (4) | 3.16 | 3.11 | 2.89 | 2.84 | 3.04 | |||||||||||||||
| Net interest margin (FTE), excluding purchased loan accretion (4) | 3.02 | 3.01 | 2.89 | 2.84 | 3.04 | |||||||||||||||
| Efficiency ratio (2) | 0.56 | 0.63 | 0.61 | 0.62 | 0.6 | |||||||||||||||
GROWTH (Year-to-date) | ||||||||||||||||||||
| Total commercial loans, (annualized) (2) | (5.4 | )% | 20.0 | % | 14.9 | % | 3.3 | % | (0.1 | )% | ||||||||||
| Total loans, (annualized) (2) | 0.7 | 13.3 | 15.0 | 15.0 | 16.9 | |||||||||||||||
| Total deposits, (annualized) (2) | 7.1 | (10.2 | ) | 6.5 | 17.7 | 11.3 | ||||||||||||||
FINANCIAL DATA (In millions) | ||||||||||||||||||||
| Total assets | $ | 3,503 | $ | 3,427 | $ | 1,755 | $ | 1,718 | $ | 1,688 | ||||||||||
| Total earning assets | 3,139 | 3,139 | 1,683 | 1,649 | 1,608 | |||||||||||||||
| Total investments | 763 | 767 | 554 | 561 | 559 | |||||||||||||||
| Total loans | 2,377 | 2,372 | 1,129 | 1,088 | 1,049 | |||||||||||||||
| Allowance for loan losses | 11 | 11 | 10 | 10 | 10 | |||||||||||||||
| Total goodwill and intangible assets | 109 | 109 | 5 | 5 | 5 | |||||||||||||||
| Total deposits | 2,213 | 2,174 | 1,050 | 1,034 | 990 | |||||||||||||||
| Total shareholders' equity | 347 | 341 | 157 | 164 | 165 | |||||||||||||||
| Net income | 7 | 4 | 3 | 4 | 4 | |||||||||||||||
| Core income (4) | 8 | 6 | 4 | 3 | 4 | |||||||||||||||
| ASSET QUALITY AND CONDITION RATIOS | ||||||||||||||||||||
| Net charge-offs (current quarter annualized)/average loans (5) | 0.03 | % | 0.06 | % | (0.03 | )% | (0.03 | )% | 0.03 | % | ||||||||||
| Allowance for loan losses/total loans (5) | 0.48 | 0.46 | 0.92 | 0.93 | 0.94 | |||||||||||||||
| Loans/deposits | 107 | 109 | 108 | 105 | 106 | |||||||||||||||
| Shareholders' equity to total assets | 9.91 | 9.95 | 8.93 | 9.57 | 9.79 | |||||||||||||||
| Tangible shareholders' equity to tangible assets (2) | 7.01 | 6.99 | 8.65 | 9.29 | 9.50 | |||||||||||||||
(1) Adjusted measurements are non-GAAP financial measures that are adjusted to exclude net non-operating charges primarily related to acquisitions, and gain on sale of securities. Refer to the Reconciliation of Non-GAAP Financial Measures in table J for additional information. (2) Non-GAAP financial measure.
(3) All performance ratios are annualized and are based on average balance sheet amounts, where applicable. (4) Fully taxable equivalent considers the impact of tax advantaged investment securities and loans. (5) Generally accepted accounting principles require that loans acquired in a business combination be recorded at fair value, whereas loans from business activities are recorded at cost. The fair value of loans acquired in a business combination includes expected loan losses, and there is no loan loss allowance recorded for these loans at the time of acquisition. Accordingly, the ratio of the loan loss allowance to total loans is reduced as a result of the existence of such loans, and this measure is not directly comparable to prior periods. Similarly, net loan charge-offs are normally reduced for loans acquired in a business combination since these loans are recorded net of expected loan losses. Therefore, the ratio of net loan charge-offs to average loans is reduced as a result of the existence of such loans, and this measure is not directly comparable to prior periods. Other institutions may have loans acquired in a business combination, and therefore there may be no direct comparability of these ratios between and among other institutions.
A
| BAR HARBOR BANKSHARES | ||||||||||||
| CONSOLIDATED BALANCE SHEETS - UNAUDITED | ||||||||||||
| (In thousands) | June 30, 2017 | March 31, 2017 (1) | December 31, 2016 | |||||||||
| Assets | ||||||||||||
| Cash and due from banks | $ | 28,112 | $ | 29,245 | $ | 8,219 | ||||||
| Interest-bearing deposit with the Federal Reserve Bank | 90,881 | 12,781 | 220 | |||||||||
| Total cash and cash equivalents | 118,993 | 3,385,456 | 8,439 | |||||||||
| Securities available for sale, at fair value | 718,364 | 724,224 | 528,856 | |||||||||
| Federal Home Loan Bank stock | 44,168 | 42,404 | 25,331 | |||||||||
| Total securities | 762,532 | 766,628 | 554,187 | |||||||||
| Commercial real estate | 738,584 | 779,635 | 418,119 | |||||||||
| Commercial and industrial | 350,002 | 309,995 | 151,240 | |||||||||
| Residential real estate | 1,160,832 | 1,155,436 | 506,612 | |||||||||
| Consumer | 127,229 | 127,370 | 53,093 | |||||||||
| Total loans | 2,376,647 | 2,372,436 | 1,129,064 | |||||||||
| Less: Allowance for loan losses | (11,442 | ) | (10,884 | ) | (10,419 | ) | ||||||
| Net loans | 2,365,205 | 2,361,552 | 1,118,645 | |||||||||
| Premises and equipment, net | 48,590 | 45,581 | 23,419 | |||||||||
| Other real estate owned | 122 | 363 | 90 | |||||||||
| Goodwill | 100,255 | 99,901 | 4,935 | |||||||||
| Other intangible assets | 9,047 | 9,282 | 377 | |||||||||
| Cash surrender value of bank-owned life insurance | 57,233 | 56,627 | 24,450 | |||||||||
| Deferred tax asset, net | 13,211 | 14,158 | 5,990 | |||||||||
| Other assets | 28,223 | 31,364 | 14,817 | |||||||||
| Total assets | $ | 3,503,411 | $ | 3,427,483 | $ | 1,755,349 | ||||||
| Liabilities and shareholders' equity | ||||||||||||
| Demand and other non-interest bearing deposits | $ | 332,339 | $ | 349,896 | $ | 98,856 | ||||||
| NOW deposits | 451,171 | 242,876 | 175,150 | |||||||||
| Savings deposits | 360,306 | 511,091 | 77,623 | |||||||||
| Money market deposits | 285,312 | 349,491 | 282,234 | |||||||||
| Time deposits | 783,876 | 720,899 | 416,437 | |||||||||
| Total deposits | 2,213,004 | 2,174,253 | 1,050,300 | |||||||||
| Senior borrowings | 872,021 | 842,150 | 531,596 | |||||||||
| Subordinated borrowings | 43,063 | 43,078 | 5,000 | |||||||||
| Total borrowings | 915,084 | 885,228 | 536,596 | |||||||||
| Other liabilities | 28,201 | 26,954 | 11,713 | |||||||||
| Total liabilities | 3,156,289 | 3,086,435 | 1,598,609 | |||||||||
| Total common shareholders' equity | 347,122 | 341,048 | 156,740 | |||||||||
| Total liabilities and shareholders' equity | $ | 3,503,411 | $ | 3,427,483 | $ | 1,755,349 | ||||||
| Net shares outstanding (2) | 15,407 | 15,385 | 9,116 | |||||||||
| (1) | The Company completed the merger with Lake Sunapee Bank Group on January 13, 2017. |
| (2) | Adjusted for 3-for-2 stock-split March 2017. |
B
| BAR HARBOR BANKSHARES | ||||||||||||||||||||||
| CONSOLIDATED LOAN & DEPOSIT ANALYSIS - UNAUDITED | ||||||||||||||||||||||
| LOAN ANALYSIS | ||||||||||||||||||||||
| Organic Annualized Growth % (1) June 30, 2017 | ||||||||||||||||||||||
| (in thousands) | Jun 30, 2017 Balance | Mar 31, 2017 Balance | Acquired Lake Sunapee Bank Balance (2) | Dec 31, 2016 Balance | Quarter End | Year to Date | ||||||||||||||||
| Commercial real estate | $ | 738,584 | $ | 779,635 | $ | 345,586 | $ | 418,119 | (21.1 | )% | (12.0 | )% | ||||||||||
| Commercial and industrial | 263,903 | 236,526 | 89,259 | 135,564 | 46.3 | % | 57.7 | % | ||||||||||||||
| Total commercial loans | 1,002,487 | 1,016,161 | 434,845 | 553,683 | (5.4 | )% | 5.0 | % | ||||||||||||||
| Residential real estate | 1,160,832 | 1,155,436 | 652,255 | 506,612 | 1.9 | % | 0.8 | % | ||||||||||||||
| Consumer | 127,229 | 127,370 | 76,489 | 53,093 | (0.4 | )% | (8.9 | )% | ||||||||||||||
| Tax exempt and other | 86,099 | 73,469 | 44,611 | 15,676 | 68.8 | % | 329.3 | % | ||||||||||||||
| Total loans | $ | 2,376,647 | $ | 2,372,436 | $ | 1,208,200 | $ | 1,129,064 | 0.7 | % | 7.0 | % | ||||||||||
| (1) | Non-GAAP financial measure. |
| (2) | Acquired Lake Sunapee Bank loans are as of January 13, 2017. |
| DEPOSIT ANALYSIS | ||||||||||||||||||||||
| Organic Annualized Growth % (1) June 30, 2017 | ||||||||||||||||||||||
| (in thousands) | Jun 30, 2017 Balance | Mar 31, 2017 Balance | Acquired Lake Sunapee Bank Balance (2) | Dec 31, 2016 Balance | Quarter End | Year to Date | ||||||||||||||||
| Demand | $ | 332,339 | $ | 349,896 | $ | 248,051 | $ | 98,856 | (20.1 | )% | (29.5 | )% | ||||||||||
| NOW | 451,171 | 242,876 | 39,999 | 175,150 | 343.0 | % | 269.5 | % | ||||||||||||||
| Money market | 285,312 | 349,491 | 103,142 | 282,234 | (73.5 | )% | (70.9 | )% | ||||||||||||||
| Savings | 360,306 | 511,091 | 467,735 | 77,623 | (118.0 | )% | (476.8 | )% | ||||||||||||||
| Total non-maturity deposits | 1,429,128 | 1,453,354 | 858,927 | 633,863 | (6.7 | )% | (20.1 | )% | ||||||||||||||
| Total time deposits | 783,876 | 720,899 | 291,684 | 416,437 | 34.9 | % | 36.4 | % | ||||||||||||||
| Total deposits | $ | 2,213,004 | $ | 2,174,253 | $ | 1,150,611 | $ | 1,050,300 | 7.1 | % | 2.3 | % | ||||||||||
| (1) | Non-GAAP financial measure. |
| (2) | Acquired Lake Sunapee Bank deposits are as of January 13, 2017. |
C
| BAR HARBOR BANKSHARES | ||||||||||||||||
| CONSOLIDATED STATEMENTS OF INCOME - UNAUDITED | ||||||||||||||||
| Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
| (In thousands, except per share data) | 2017 | 2016 | 2017 | 2016 | ||||||||||||
| Interest and dividend income | ||||||||||||||||
| Loans | $ | 24,226 | $ | 10,249 | $ | 45,420 | $ | 20,332 | ||||||||
| Securities and other | 5,439 | 4,105 | 10,430 | 8,186 | ||||||||||||
| Total interest and dividend income | 29,665 | 14,354 | 55,850 | 28,518 | ||||||||||||
| Interest expense | ||||||||||||||||
| Deposits | 2,539 | 1,599 | 4,749 | 3,176 | ||||||||||||
| Borrowings | 3,317 | 1,373 | 5,920 | 2,624 | ||||||||||||
| Total interest expense | 5,856 | 2,972 | 10,669 | 5,800 | ||||||||||||
| Net interest income | 23,809 | 11,382 | 45,181 | 22,718 | ||||||||||||
| Provision for loan losses | 736 | 150 | 1,531 | 615 | ||||||||||||
| Net interest income after provision for loan losses | 23,073 | 11,232 | 43,650 | 22,103 | ||||||||||||
| Non-interest income | ||||||||||||||||
| Trust and investment management fee income | 3,324 | 955 | 6,188 | 1,903 | ||||||||||||
| Insurance and brokerage service income | 327 | — | 691 | — | ||||||||||||
| Customer service fees | 1,991 | 252 | 3,351 | 463 | ||||||||||||
| Gain on sales of securities, net | — | 1,699 | — | 3,135 | ||||||||||||
| Bank-owned life insurance income | 386 | 118 | 785 | 343 | ||||||||||||
| Other income | 530 | 590 | 1,489 | 1,098 | ||||||||||||
| Total non-interest income | 6,558 | 3,614 | 12,504 | 6,942 | ||||||||||||
| Non-interest expense | ||||||||||||||||
| Salaries and employee benefits | 10,127 | 4,799 | 20,448 | 9,816 | ||||||||||||
| Occupancy and equipment | 3,013 | 1,152 | 5,679 | 2,310 | ||||||||||||
| Loss on sales of premises and equipment, net | — | — | 95 | — | ||||||||||||
| Outside services | 716 | 139 | 1,313 | 249 | ||||||||||||
| Professional services | 489 | 710 | 929 | 834 | ||||||||||||
| Communication | 290 | 271 | 658 | 364 | ||||||||||||
| Amortization of intangible assets | 188 | 1 | 345 | 2 | ||||||||||||
| Merger expenses | 2,459 | 492 | 5,571 | 492 | ||||||||||||
| Other expenses | 2,764 | 949 | 5,341 | 2,226 | ||||||||||||
| Total non-interest expense | 20,046 | 8,731 | 40,877 | 16,729 | ||||||||||||
| Income before income taxes | 9,585 | 6,115 | 15,277 | 12,316 | ||||||||||||
| Income tax expense | 3,029 | 1,804 | 4,510 | 3,600 | ||||||||||||
| Net income | $ | 6,556 | $ | 4,311 | $ | 10,767 | $ | 8,716 | ||||||||
| Earnings per share: | ||||||||||||||||
| Basic (1) | $ | 0.43 | $ | 0.48 | $ | 0.72 | $ | 0.97 | ||||||||
| Diluted (1) | 0.42 | 0.47 | 0.72 | 0.96 | ||||||||||||
| Weighted average shares outstanding: | ||||||||||||||||
| Basic (1) | 15,393 | 9,023 | 14,935 | 9,023 | ||||||||||||
| Diluted (1) | 15,506 | 9,125 | 15,049 | 9,125 | ||||||||||||
(1) Adjusted for 3-for-2 stock-split completed in March 2017
D
| BAR HARBOR BANKSHARES | ||||||||||||||||||||
| CONSOLIDATED STATEMENTS OF INCOME (5 Quarter Trend) - UNAUDITED | ||||||||||||||||||||
| (In thousands, except per share data) | Jun 30, 2017 | Mar 31, 2017 | Dec 31, 2016 | Sep 30, 2016 | Jun 30, 2016 | |||||||||||||||
| Interest and dividend income | ||||||||||||||||||||
| Loans | $ | 24,226 | $ | 21,194 | $ | 11,026 | $ | 10,295 | $ | 10,249 | ||||||||||
| Securities and other | 5,439 | 4,991 | 3,820 | 3,828 | 4,105 | |||||||||||||||
| Total interest and dividend income | 29,665 | 26,185 | 14,846 | 14,123 | 14,354 | |||||||||||||||
| Interest expense | ||||||||||||||||||||
| Deposits | 2,539 | 2,210 | 1,768 | 1,755 | 1,599 | |||||||||||||||
| Borrowings | 3,317 | 2,603 | 1,421 | 1,369 | 1,373 | |||||||||||||||
| Total interest expense | 5,856 | 4,813 | 3,189 | 3,124 | 2,972 | |||||||||||||||
| Net interest income | 23,809 | 21,372 | 11,657 | 10,999 | 11,382 | |||||||||||||||
| Provision for loan losses | 736 | 795 | 225 | 139 | 150 | |||||||||||||||
| Net interest income after provision for loan losses | 23,073 | 20,577 | 11,432 | 10,860 | 11,232 | |||||||||||||||
| Non-interest income | ||||||||||||||||||||
| Trust and investment management fee income | 3,324 | 2,864 | 951 | 975 | 955 | |||||||||||||||
| Insurance and brokerage service income | 327 | 364 | — | — | — | |||||||||||||||
| Customer service fees | 1,991 | 1,360 | 188 | 215 | 252 | |||||||||||||||
| Gain on sales of securities, net | — | — | 9 | 1,354 | 1,699 | |||||||||||||||
| Bank-owned life insurance income | 386 | 399 | 163 | 197 | 118 | |||||||||||||||
| Other income | 530 | 959 | 724 | 631 | 590 | |||||||||||||||
| Total non-interest income | 6,558 | 5,946 | 2,035 | 3,372 | 3,614 | |||||||||||||||
| Non-interest expense | ||||||||||||||||||||
| Salaries and employee benefits | 10,127 | 10,321 | 5,127 | 4,832 | 4,799 | |||||||||||||||
| Occupancy and equipment | 3,013 | 2,666 | 1,144 | 1,156 | 1,152 | |||||||||||||||
| Loss on sales of premises and equipment,net | — | 95 | 32 | 216 | — | |||||||||||||||
| Outside services | 716 | 597 | 337 | 181 | 139 | |||||||||||||||
| Professional services | 489 | 440 | 405 | 250 | 710 | |||||||||||||||
| Communication | 290 | 368 | 94 | 128 | 271 | |||||||||||||||
| Amortization of intangible assets | 188 | 157 | 1 | 1 | 1 | |||||||||||||||
| Merger expenses | 2,459 | 3,112 | 1,838 | 320 | 492 | |||||||||||||||
| Other expenses | 2,764 | 2,695 | 1,269 | 1,506 | 949 | |||||||||||||||
| Total non-interest expense | 20,046 | 20,831 | 10,457 | 8,750 | 8,731 | |||||||||||||||
| Income before income taxes | 9,585 | 5,692 | 3,010 | 5,482 | 6,115 | |||||||||||||||
| Income tax expense | 3,029 | 1,481 | 426 | 1,850 | 1,804 | |||||||||||||||
| Net income | $ | 6,556 | $ | 4,211 | $ | 2,584 | $ | 3,632 | $ | 4,311 | ||||||||||
| Earnings per share: | ||||||||||||||||||||
| Basic (1) | $ | 0.43 | $ | 0.29 | $ | 0.28 | $ | 0.40 | $ | 0.48 | ||||||||||
| Diluted (1) | 0.42 | 0.29 | 0.28 | 0.40 | 0.47 | |||||||||||||||
| Weighted average shares outstanding: | ||||||||||||||||||||
| Basic (1) | 15,393 | 14,471 | 9,096 | 9,064 | 9,032 | |||||||||||||||
| Diluted (1) | 15,506 | 14,591 | 9,215 | 9,162 | 9,129 | |||||||||||||||
(1) Adjusted for 3-for-2 stock split completed in March 2017
E
| BAR HARBOR BANKSHARES | |||||||||||||||
| AVERAGE YIELDS AND COSTS (Fully Taxable Equivalent - Annualized) - UNAUDITED | |||||||||||||||
| Quarters Ended | |||||||||||||||
| Jun 30, 2017 | Mar 31, 2017 | Dec 31, 2016 | Sep 30, 2016 | Jun 30, 2016 | |||||||||||
| Earning assets | |||||||||||||||
| Loans | 4.14 | % | 4.00 | % | 3.94 | % | 3.89 | % | 4.03 | % | |||||
| Securities and other | 3.19 | 3.01 | 3.01 | 3.07 | 3.37 | ||||||||||
| Total earning assets | 3.91 | % | 3.76 | % | 3.65 | % | 3.62 | % | 3.80 | % | |||||
| Funding liabilities | |||||||||||||||
| Interest bearing deposits | 0.56 | % | 0.52 | % | 0.76 | % | 0.78 | % | 0.76 | % | |||||
| Borrowings | 1.41 | 1.25 | 1.05 | 1.06 | 0.99 | ||||||||||
| Total interest-bearing liabilities | 0.85 | % | 0.76 | % | 0.86 | % | 0.88 | % | 0.85 | % | |||||
| Net interest spread | 3.06 | 3.00 | 2.79 | 2.74 | 2.95 | ||||||||||
| Net interest margin | 3.16 | 3.11 | 2.89 | 2.84 | 3.04 | ||||||||||
F
| BAR HARBOR BANKSHARES | ||||||||||||||||||||
| AVERAGE BALANCES - UNAUDITED | ||||||||||||||||||||
| Quarters Ended | ||||||||||||||||||||
| (In thousands) | Jun 30, 2017 | Mar 31, 2017 | Dec 31, 2016 | Sep 30, 2016 | Jun 30, 2016 | |||||||||||||||
| Assets | ||||||||||||||||||||
| Total loans (1) | $ | 2,377,141 | $ | 2,346,340 | $ | 1,119,065 | $ | 1,058,253 | $ | 1,028,748 | ||||||||||
| Securities and other (2) | 761,546 | 746,653 | 556,365 | 551,456 | 546,917 | |||||||||||||||
| Total earning assets | 3,138,687 | 3,092,994 | 1,675,430 | 1,609,709 | 1,575,665 | |||||||||||||||
| Cash and due from banks | 87,332 | 25,556 | 5,976 | 5,819 | 5,400 | |||||||||||||||
| Allowance for loan losses | (11,292 | ) | (10,584 | ) | (10,336 | ) | (10,095 | ) | (10,036 | ) | ||||||||||
| Goodwill and other intangible assets | 109,108 | 109,261 | 5,324 | 5,347 | 5,370 | |||||||||||||||
| Other assets | 110,129 | 122,396 | 71,807 | 78,755 | 75,177 | |||||||||||||||
| Total assets | $ | 3,433,964 | $ | 3,339,623 | $ | 1,748,201 | $ | 1,689,535 | $ | 1,651,576 | ||||||||||
| Liabilities and shareholders' equity | ||||||||||||||||||||
| Total interest-bearing deposits | $ | 1,811,226 | $ | 1,798,014 | $ | 930,983 | $ | 897,703 | $ | 845,042 | ||||||||||
| Borrowings | 941,789 | 856,328 | 537,818 | 514,999 | 557,593 | |||||||||||||||
| Total interest-bearing liabilities | 2,753,015 | 2,654,343 | 1,468,801 | 1,412,702 | 1,402,635 | |||||||||||||||
| Non-interest-bearing demand deposits | 320,503 | 350,497 | 108,961 | 103,971 | 80,119 | |||||||||||||||
| Other liabilities | 13,145 | 19,334 | 7,929 | 7,376 | 7,147 | |||||||||||||||
| Total liabilities | 3,086,663 | 3,024,174 | 1,585,691 | 1,524,049 | 1,489,901 | |||||||||||||||
| Total shareholders' equity | 347,301 | 315,449 | 162,510 | 165,486 | 161,675 | |||||||||||||||
| Total liabilities and shareholders' equity | $ | 3,433,964 | $ | 3,339,623 | $ | 1,748,201 | $ | 1,689,535 | $ | 1,651,576 | ||||||||||
| (1) | Total loans include non-accruing loans. |
| (2) | Average balances for securities available-for-sale are based on amortized cost. |
G
| BAR HARBOR BANKSHARES | ||||||||||||||||||||
| ASSET QUALITY ANALYSIS - UNAUDITED | ||||||||||||||||||||
| At or for the Quarters Ended | ||||||||||||||||||||
| (in thousands) | Jun 30, 2017 | Mar 31, 2017 | Dec 31, 2016 | Sep 30, 2016 | Jun 30, 2016 | |||||||||||||||
| NON-PERFORMING ASSETS | ||||||||||||||||||||
| Non-accruing loans: | ||||||||||||||||||||
| Commercial real estate | $ | 2,090 | $ | 2,354 | $ | 2,564 | $ | 2,478 | $ | 1,900 | ||||||||||
| Commercial installment | 270 | 451 | 315 | 276 | 190 | |||||||||||||||
| Residential real estate | 2,783 | 3,066 | 3,419 | 3,429 | 3,157 | |||||||||||||||
| Consumer installment | 160 | 160 | 198 | 219 | 225 | |||||||||||||||
| Total non-accruing loans | 5,303 | 6,031 | 6,496 | 6,402 | 5,472 | |||||||||||||||
| Other real estate owned | 122 | 363 | 90 | 189 | 209 | |||||||||||||||
| Total non-performing assets | $ | 5,425 | $ | 6,394 | $ | 6,586 | $ | 6,591 | $ | 5,681 | ||||||||||
| Total non-accruing loans/total loans | 0.22 | % | 0.25 | % | 0.58 | % | 0.59 | % | 0.52 | % | ||||||||||
| Total non-performing assets/total assets | 0.15 | 0.19 | 0.38 | 0.38 | 0.34 | |||||||||||||||
| PROVISION AND ALLOWANCE FOR LOAN LOSSES | ||||||||||||||||||||
| Balance at beginning of period | $ | 10,884 | $ | 10,419 | $ | 10,103 | $ | 9,891 | $ | 9,814 | ||||||||||
| Charged-off loans | (214 | ) | (344 | ) | (28 | ) | (120 | ) | (99 | ) | ||||||||||
| Recoveries on charged-off loans | 35 | 14 | 119 | 193 | 26 | |||||||||||||||
| Net loans charged-off | (178 | ) | (330 | ) | 91 | 73 | (73 | ) | ||||||||||||
| Provision for loan losses | 736 | 795 | 225 | 139 | 150 | |||||||||||||||
| Balance at end of period | $ | 11,442 | $ | 10,884 | $ | 10,419 | $ | 10,103 | $ | 9,891 | ||||||||||
| Allowance for loan losses/total loans | 0.48 | % | 0.46 | % | 0.92 | % | 0.93 | % | 0.94 | % | ||||||||||
| Allowance for loan losses/non-accruing loans | 216 | 181 | 160 | 158 | 181 | |||||||||||||||
| NET LOAN CHARGE-OFFS | ||||||||||||||||||||
| Commercial real estate | $ | (6 | ) | $ | (103 | ) | $ | 5 | $ | (77 | ) | $ | 7 | |||||||
| Commercial installment | (138 | ) | (17 | ) | 89 | 156 | 2 | |||||||||||||
| Residential real estate | (13 | ) | (198 | ) | 8 | (11 | ) | (83 | ) | |||||||||||
| Consumer installment | (22 | ) | (12 | ) | (11 | ) | 5 | 1 | ||||||||||||
| Total, net | $ | (178 | ) | $ | (330 | ) | $ | 91 | $ | 73 | $ | (73 | ) | |||||||
| Net charge-offs (QTD annualized)/average loans | 0.03 | % | 0.06 | % | (0.03 | )% | (0.03 | )% | 0.03 | % | ||||||||||
| Net charge-offs (YTD annualized)/average loans | 0.04 | 0.06 | (0.03 | ) | 0.01 | 0.03 | ||||||||||||||
| DELINQUENT AND NON-ACCRUING LOANS/TOTAL LOANS | ||||||||||||||||||||
| 30-89 Days delinquent | 0.55 | % | 0.33 | % | 0.54 | % | 0.15 | % | 0.32 | % | ||||||||||
| 90+ Days delinquent and still accruing | — | — | — | — | 0.01 | |||||||||||||||
| Total accruing delinquent loans | 0.55 | 0.33 | 0.54 | 0.15 | 0.33 | |||||||||||||||
| Non-accruing loans | 0.22 | 0.25 | 0.58 | 0.59 | 0.52 | |||||||||||||||
| Total delinquent and non-accruing loans | 0.77 | % | 0.58 | % | 1.12 | % | 0.74 | % | 0.85 | % | ||||||||||
H
| BAR HARBOR BANKSHARES | |||||||||||||||||||||
| RECONCILIATION OF NON-GAAP FINANCIAL MEASURES AND SUPPLEMENTARY DATA- UNAUDITED | |||||||||||||||||||||
| At or for the Quarters Ended | |||||||||||||||||||||
| (in thousands) | Jun 30, 2017 | Mar 31, 2017 | Dec 31, 2016 | Sep 30, 2016 | Jun 30, 2016 | ||||||||||||||||
| Net income | $ | 6,556 | $ | 4,211 | $ | 2,584 | $ | 3,632 | $ | 4,311 | |||||||||||
| Adj: Security Gains | — | — | (9 | ) | (1,354 | ) | (1,699 | ) | |||||||||||||
| Adj: Loss on sale of fixed assets, net | — | 95 | 32 | 216 | — | ||||||||||||||||
| Adj: Merger and acquisition expense | 2,459 | 3,112 | 1,838 | 320 | 492 | ||||||||||||||||
| Adj: Income taxes (37.57% in 2017, 35.0% in 2016) | (924 | ) | (1,205 | ) | (651 | ) | 286 | 422 | |||||||||||||
| Total core income (4) | (A) | $ | 8,091 | $ | 6,213 | $ | 3,794 | $ | 3,100 | $ | 3,526 | ||||||||||
| Net-interest income | $ | 23,809 | $ | 21,372 | $ | 11,657 | $ | 10,999 | $ | 11,382 | |||||||||||
| Plus: Non-interest income | 6,558 | 5,946 | 2,035 | 3,372 | 3,614 | ||||||||||||||||
| Total Revenue | 30,367 | 27,318 | 13,692 | 14,371 | 14,996 | ||||||||||||||||
| Adj: Net security gains | — | — | (9 | ) | (1,354 | ) | (1,699 | ) | |||||||||||||
| Total core revenue (4) | (B) | $ | 30,367 | $ | 27,318 | $ | 13,683 | $ | 13,017 | $ | 13,297 | ||||||||||
| Total non-interest expense | $ | 20,046 | $ | 20,831 | $ | 10,457 | $ | 8,750 | $ | 8,731 | |||||||||||
| Less: Merger and acquisition expense | (2,459 | ) | (3,112 | ) | (1,838 | ) | (320 | ) | (492 | ) | |||||||||||
| Core non-interest expense (4) | (C) | $ | 17,587 | $ | 17,719 | $ | 8,619 | $ | 8,430 | $ | 8,239 | ||||||||||
| (in millions, except per share data) | |||||||||||||||||||||
| Total average assets | (D) | $ | 3,434 | $ | 3,340 | $ | 1,748 | $ | 1,690 | $ | 1,652 | ||||||||||
| Total average shareholders' equity | (E) | 347 | 315 | 163 | 165 | 162 | |||||||||||||||
| Total average tangible shareholders' equity | (F) | 238 | 206 | 157 | 160 | 156 | |||||||||||||||
| Total tangible shareholders' equity, period-end (1) | (G) | 238 | 232 | 151 | 159 | 160 | |||||||||||||||
| Total tangible assets, period-end (1) | (H) | 3,394 | 3,318 | 1,750 | 1,713 | 1,682 | |||||||||||||||
Total common shares outstanding, period-end (thousands) | (I) | 15,407 | 15,385 | 9,116 | 9,084 | 9,045 | |||||||||||||||
Average diluted shares outstanding (thousands) | (J) | 15,506 | 14,591 | 9,215 | 9,162 | 9,129 | |||||||||||||||
| Core earnings per share, diluted | (A/J) | $ | 0.52 | $ | 0.43 | $ | 0.41 | $ | 0.34 | $ | 0.39 | ||||||||||
| Tangible book value per share, period-end | (G/I) | 15.44 | 15.07 | 16.61 | 17.51 | 17.67 | |||||||||||||||
| Total tangible shareholders' equity/total tangible assets | (G)/(H) | 7.01 | 6.99 | 8.65 | 9.29 | 9.50 | |||||||||||||||
| Performance ratios (2) | |||||||||||||||||||||
| GAAP return on assets | 0.76 | % | 0.50 | % | 0.59 | % | 0.86 | % | 1.04 | % | |||||||||||
| Core return on assets (4) | (A/D) | 0.94 | 0.74 | 0.86 | 0.70 | 0.85 | |||||||||||||||
| GAAP return on equity | 7.55 | 5.34 | 6.36 | 8.78 | 10.67 | ||||||||||||||||
| Core return on equity (4) | (A/E) | 9.32 | 7.88 | 9.29 | 7.15 | 8.72 | |||||||||||||||
| Core return on tangible equity (3) (4) | (A/F) | 13.78 | 12.24 | 9.60 | 7.39 | 9.03 | |||||||||||||||
| Efficiency ratio (4)(5) | (C-M)/ (B+N) | 0.56 | 0.63 | 0.61 | 0.62 | 0.60 | |||||||||||||||
| Net interest margin | 3.16 | 3.11 | 2.89 | 2.84 | 3.04 | ||||||||||||||||
Supplementary data (in thousands) | |||||||||||||||||||||
| Fully taxable equivalent income adjustment | (N) | $ | 813 | $ | 754 | $ | 519 | $ | 511 | $ | 526 | ||||||||||
| Intangible amortization | (M) | 188 | 157 | 1 | 1 | 1 | |||||||||||||||
I
(1) Total tangible shareholders' equity is computed by taking total shareholders' equity less the intangible assets at period-end.
Total tangible assets is computed by taking total assets less the intangible assets at period-end.
(2) Ratios are annualized and based on average balance sheet amounts, where applicable. Quarterly data may not sum to
year-to-date data due to rounding.
(3) Core return on tangible equity is computed by dividing the total core income adjusted for the tax-effected amortization of
intangible assets, assuming a marginal rate of 37.57% in 2017 and 35.0% in 2016, by tangible equity.
(4) Non-GAAP financial measure.
(5) Efficiency ratio is computed by dividing total core tangible non-interest expense by the sum of total net interest income on a
fully taxable equivalent basis and total core non-interest income. The Company uses this non-GAAP measure to
provide important information about its operating efficiency.
J