Exhibit 99.1
| FOR IMMEDIATE RELEASE | CONTACT: | Kate Rajeck | ||||
| Investor Relations | ||||||
| (617) 912-4380 | ||||||
| www.bostonprivate.com |
Boston Private Reports Strong Fourth Quarter Results
2004 full year earnings per share up 28%
Boston, MA, January 26, 2005– Boston Private Financial Holdings, Inc. (NASDAQ: BPFH) today reported fourth quarter 2004 earnings of $0.33 per diluted share, up 18% compared to $0.28 per diluted share for the fourth quarter 2003. Net income for the fourth quarter 2004 was up 38% to $9.5 million, compared to net income of $6.9 million a year ago. For the year ended December 31, 2004, Boston Private reported earnings of $1.18 per diluted share, up 28% compared to $0.92 per diluted share for the year ended December 31, 2003. Net income for 2004 was up 54% to $33.6 million, compared to net income of $21.8 million a year ago. The Company also announced its quarterly cash dividend to shareholders increased 17% to $0.07 per share.
Cash earnings for the fourth quarter 2004 increased 31% to $0.38 per diluted share compared to $0.29 per diluted share for the fourth quarter 2003. Cash earnings for 2004 increased 28% to $1.37 per diluted share compared to $1.07 per diluted share for 2003. Boston Private calculates its cash earnings by adjusting net income to exclude significant nonrecurring items, and net amortization of intangibles and tax benefits related to purchase accounting. The Company provides this information to permit investors to compare Boston Private with similar companies that have not made acquisitions. (A detailed reconciliation table is attached.)
Timothy L. Vaill, Chairman and Chief Executive Officer, said, “Boston Private achieved strong growth this year and I am proud of our Affiliates’ accomplishments. The increase in profits reflects the organic growth realized throughout our organization, the strength of our diversified business model and the success of our geographic expansion. We are encouraged by the opportunities for growth that we see in the wealth management marketplace and we are focused on executing our business objectives as we to strive to deliver solid results for our shareholders.”
Fourth Quarter 2004 Results
Boston Private reported revenues increased 55% to $55.9 million for the fourth quarter 2004, over revenues of $36.2 million for the fourth quarter 2003. This increase was due to growth achieved in each of the Company’s businesses: private banking, wealth advisory and investment management, as well as the affiliation with three new companies in 2004. (The Company has incorporated presentations in the attached financial schedules excluding the impact of these affiliations in 2004 to facilitate an analysis of financial results on a “same affiliates” basis.)
The Company’s net interest income increased 45% or $7.9 million for fourth quarter 2004 compared to fourth quarter 2003. On a same affiliate basis, net interest income
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increased 26% for this period. Boston Private’s net interest margin decreased 7 basis points to 3.61% in the fourth quarter 2004 compared to the third quarter, primarily due to increased interest expense associated with the Company’s trust preferred convertible debt offering. Excluding the impact of the trust preferred offering in October, which was used to finance acquisitions, the consolidated bank net interest margin was 3.77% in the fourth quarter 2004. Income from other private banking fees, gains on sale of loans and investments and earnings in equity investments was up 108% to $3.3 million in the fourth quarter 2004 compared to $1.6 million in the prior year.
Boston Private’s loan portfolio achieved strong growth in 2004 with commercial loans up 54% and residential loans up 22% over the prior year. Commercial loans totaled $1.4 billion and represented 60% of the combined loan portfolio. Residential loans totaled $797 million and represented 35% of the total portfolio. Combined, the loan portfolio grew 39% over the past twelve months. This loan growth was supported by growth in deposits, which increased 44% to $2.4 billion in the fourth quarter 2004 over the prior year. The acquisitions of First State Bank in February and Encino State Bank in October added $346 million in deposits and $267 million in loans in 2004.
In Boston Private’s wealth advisory fee income grew 5.4% to $1.9 million for the fourth quarter 2004 over $1.8 million for the prior year. Investment management fee income for the fourth quarter 2004 totaled $25.2 million, up 66% over fourth quarter 2003. On a same affiliate basis, investment management fees increased 22% for the same period. Assets under advisory increased 76% to $19.3 billion at December 31, 2004 from $11.0 billion at December 31, 2003. Including the Company’s unconsolidated affiliates, total assets under advisory increased 84% to $21.1 billion over the prior year. Organic net new sales were $36 million in the fourth quarter and totaled $862 million for the full year 2004, representing an annualized growth rate of 8%. Market action, or general appreciation in the market prices of securities, resulted in an increase of $1.3 billion during the fourth quarter of 2004.
Operating expenses, including the impact of acquisitions, were $39.3 million for the fourth quarter 2004, up 57% over the fourth quarter 2003. Operating expenses, excluding the impact of acquisitions, rose 27% during the same period. The main drivers of operating expense growth were operating expenses of the acquired affiliates, incentive compensation and investments in new business initiatives.
Walter M. Pressey, President, commented, “Boston Private finished 2004 with a strong fourth quarter and I am pleased with our new business volumes and our ability to execute competitively. Our strategy to enter attractive markets and grow those businesses organically gives us a strong diversified revenue base that benefits from positive market trends and helps to mitigate the impact of periodic adverse conditions. Additionally, we have been careful to manage our operating leverage while investing in our infrastructure and future growth.”
2004 Year-End Results
For the year ended December 31, 2004, Boston Private reported total revenues of $196.8 million, an increase of 47% from $133.6 million for 2003. Net income for 2004 was $33.6 million, up 54% from $21.8 million for 2003.
In the Company’s private banking business, net interest income increased 33% to $89.7 million, up from $67.5 million for 2003. Increased business volume added approximately $22.9 million of interest income, more than offsetting the effect of interest rate margin compression, which decreased net interest income by approximately $717,000. The Company’s net interest margin for the year was 3.61%, down 3 basis points from 3.64% a year ago due to interest rate compression
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widespread in the banking industry, combined with the increased interest expense related to the Company’s convertible trust preferred financing. Excluding the impact of the trust preferred offering, the consolidated bank net interest margin was 3.66% for 2004. Boston Private’s balance sheet assets increased 49% to approximately $3.3 billion, compared to $2.2 billion at year-end 2003.
Boston Private’s wealth advisory fee income grew 14% to $7.9 million for 2004 over $7.0 million for the prior year. Investment management fee income for 2004 was $92.1 million, up 86% from $49.4 million in 2003. Total fees and other income were $108.2 million in 2004, representing 55% of total revenues. Including the Company’s unconsolidated affiliates, assets under management and advisory at year-end 2004 were $21.1 billion, up 84% from $11.5 billion at year-end 2003. Organic growth across the affiliates accounted for $1.0 billion, or 10% of the increase and $1.8 billion, or 19% of the increase, resulted from market appreciation. Acquired assets of $6.9 billion from Dalton, Greiner, Hartman, & Maher LLC, KLS Professional Advisors Group, LLC and Bingham, Osborn & Scarborough LLC accounted for 71% of the increase.
Operating expenses, including the impact of acquisitions, were $138.9 million for the year, up 45% over the prior year. Excluding the impact of acquisitions, operating expenses rose 22% during the same period. The main drivers of Boston Private’s operating expense growth in 2004 were operating expenses of the acquired affiliates, incentive compensation and investments in new business, reflecting Boston Private’s increased sales and profits, geographic expansion and the increased number of operating companies.
Strategic Expansion Developments
In October, 2004, the Company acquired of Encino State Bank (ENST.OB) of Encino, California, for approximately $33.1 million. Encino, a $189 million asset commercial bank with three offices in West Los Angeles, was merged with First State Bank, resulting in a combined private bank with over $400 million in assets. In December, Boston Private acquired an 81% interest in KLS Professional Advisors Group, LLC (KLS) for approximately $30 million. Located in New York City, KLS is a wealth management firm with approximately $2.9 billion of client assets under advisory.
To support the Company’s acquisition strategy and maintain capital requirements, Boston Private Capital Trust I issued approximately $105 million of convertible trust preferred securities guaranteed by the Company in October 2004. A portion of the proceeds from this offering were used to finance acquisitions and to pay down borrowings under the Company’s line of credit. The Company has approximately $26 million in cash and short-term investments which it anticipates using to fund future acquisitions.
Dividend Payment Increases 17%
Concurrent with the release of the fourth quarter 2004 earnings, the Board of Directors of Boston Private Financial Holdings declared a cash dividend to shareholders of $0.07 per share, reflecting the quarterly earnings performance and an increase of 17% over the prior quarter’s cash dividend of $0.06 per share. The record date for this dividend is February 1, 2005 and the payment date is February 15, 2005.
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Conference Call
Management will host a conference call to review the Company’s financial performance and business developments on January 27, 2005 at 9.a.m.Eastern time. Interested parties may join the call by dialing 877-707-9628 and the password required is “Boston”. The call will be simultaneously web cast and may be accessed on the Internet by linking throughwww.bostonprivate.com,www.prnewswire.com, or Yahoo! Finance. A continuous telephone replay will be available beginning at 10:30 a.m. Eastern time. The replay telephone number is 800-388-9064.
Boston Private Wealth Management Group
Boston Private is a financial services company which owns independently-operated affiliates located in key geographic regions of the U.S. Boston Private’s affiliates offer private banking, wealth advisory and investment management services to the high net worth marketplace, selected businesses and institutions. The Company’s strategy is to enter new markets primarily through selected acquisitions, and then expand its wealth management business by way of organic growth. It makes investments in mid-size firms in demographically attractive areas, forming geographic clusters that represent the firm’s core competencies. Boston Private provides continuing assistance to its affiliates with strategic matters, marketing, compliance and operations. For more information about Boston Private, visit the company’s web site atwww.bostonprivate.com.
This press release contains financial information determined by methods other than in accordance with accounting principles generally accepted in the United States of America (“GAAP”). The Company’s management uses these non-GAAP measures in its analysis of the Company’s performance. These measures typically adjust GAAP performance measures to exclude the effects of charges and expenses related to the consummation of mergers and acquisitions and costs related to the integration of merged entities, as well as excluding other significant gains or losses that are unusual in nature, and are calculated on a fully taxable equivalent income basis. Because these items and their impact on the Company’s performance are difficult to predict, management believes that presentations of financial measures excluding the impact of these items provide useful supplemental information that is essential to a proper understanding of the operating results of the Company’s businesses. These disclosures should not be viewed as a substitute for operating results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures which may be presented by other companies.
Statements in this press release that are not historical facts are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve risks and uncertainties. These statements include, but are not limited to,prospects for long term financial performance, the impact on the Company’s results of improved market conditions and prevailing and future interest rates, prospects for growth in balance sheet assets and assets under advisory, and prospects for overall results over the long term. You should not place undue reliance on our forward-looking statements. You should exercise caution in interpreting and relying on forward-looking statements because they are subject to significant risks, uncertainties and other factors which are, in some cases, beyond Boston Private’s control and could cause actual results to differ materially from those set forth in the forward-looking statements. Factors that could cause actual results to differ materially from those set forth in the forward-looking statements include, among others, adverse conditions in the capital markets and the impact of such conditions on Boston Private’s investment advisory activities; continued or increased interest rate compression which may adversely impact net interest income; competitive pressures from other financial institutions which, together with other factors, may affect the Company’s growth and financial performance; the effects of national and local economic conditions; and the risk that goodwill and intangibles recorded in the Company’s financial statements will become impaired; as well as the other risks and uncertainties detailed in Boston Private’s Annual Report on Form 10-K and other filings submitted to the Securities and Exchange Commission. Boston Private does not undertake any obligation to update any forward-looking statement to reflect circumstances or events that occur after the date the forward-looking statements are made.
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Boston Private Financial Holdings, Inc.
Selected Financial Data
(Unaudited)
(In Thousands)
| December 31, 2004 | December 31, 2003 | % Change | ||||||||
FINANCIAL DATA: | |||||||||||
Total Balance Sheet Assets | $ | 3,270,277 | $ | 2,196,297 | 48.9 | % | |||||
Stockholders’ Equity | 321,227 | 235,452 | 36.4 | % | |||||||
Tangible Capital: | |||||||||||
Boston Private Bank | 116,164 | 103,063 | 12.7 | % | |||||||
Borel Private Bank | 59,242 | 45,500 | 30.2 | % | |||||||
First State Bank | 29,856 | — | nm | ||||||||
Investment Securities | 559,190 | 407,868 | 37.1 | % | |||||||
Goodwill | 130,486 | 17,181 | nm | ||||||||
Intangible Assets | 56,677 | 3,137 | nm | ||||||||
Commercial Loans | 1,357,067 | 880,626 | 54.1 | % | |||||||
Residential Mortgage Loans | 796,991 | 651,290 | 22.4 | % | |||||||
Home Equity and Other Consumer Loans | 94,542 | 80,648 | 17.2 | % | |||||||
Total Loans | 2,248,600 | 1,612,564 | 39.4 | % | |||||||
Loans Held for Sale | 42,384 | 4,900 | nm | ||||||||
Allowance for Loan Losses | 27,937 | 20,172 | 38.5 | % | |||||||
Non-performing Loans | 1,137 | 1,311 | (13.3 | )% | |||||||
Other Real Estate Owned | 377 | — | nm | ||||||||
Total Non-performing Assets | 1,514 | 1,311 | 15.5 | % | |||||||
Deposits | 2,386,368 | 1,658,461 | 43.9 | % | |||||||
Borrowings | 474,171 | 263,620 | 79.9 | % | |||||||
Book Value Per Share | $ | 11.61 | $ | 9.36 | 24.0 | % | |||||
Market Price Per Share | $ | 28.17 | $ | 24.84 | 13.4 | % | |||||
ASSETS UNDER ADVISORY: | |||||||||||
Westfield Capital Management | $ | 7,707,000 | $ | 6,153,000 | 25.3 | % | |||||
Boston Private Bank | 2,010,000 | 1,986,000 | 1.2 | % | |||||||
Sand Hill Advisors | 1,062,000 | 860,000 | 23.5 | % | |||||||
Boston Private Value Investors | 860,000 | 779,000 | 10.4 | % | |||||||
RINET Company | 1,051,000 | 800,000 | 31.4 | % | |||||||
Borel Private Bank | 568,000 | 538,000 | 5.6 | % | |||||||
Dalton, Greiner, Hartman, Maher & Co. | 3,353,000 | — | nm | ||||||||
KLS Professional Advisors Group | 2,880,000 | — | nm | ||||||||
Less: Inter-company Relationship | (185,000 | ) | (150,000 | ) | 23.3 | % | |||||
Consolidated Assets Under Advisory | $ | 19,306,000 | $ | 10,966,000 | 76.1 | % | |||||
Coldstream Capital Management | 600,000 | 500,000 | 20.0 | % | |||||||
Bingham, Osborn, & Scarborough | 1,167,000 | — | nm | ||||||||
Total Unconsolidated Assets Under Advisory | 21,073,000 | 11,466,000 | 83.8 | % | |||||||
FINANCIAL RATIOS: | |||||||||||
Stockholders’ Equity/Total Assets | 9.82 | % | 10.72 | % | (8.4 | )% | |||||
Non-performing Loans/Total Loans | 0.05 | % | 0.08 | % | (0.4 | ) | |||||
Allowance for Loan Losses/Total Loans | 1.24 | % | 1.25 | % | (0.8 | )% | |||||
Allowance for Loan Losses/Non-performing Assets | 1845.24 | % | 1538.67 | % | 19.9 | % | |||||
Total Tangible Capital/Total Tangible Assets | 4.35 | % | 9.89 | % | (56.0 | )% | |||||
| Three Months Ended | % Change | Twelve Months Ended | % Change | |||||||||||||||
| December 31, 2004 | December 31, 2003 | December 31, 2004 | December 31, 2003 | |||||||||||||||
OPERATING RESULTS: | ||||||||||||||||||
Net Interest Income on a Fully Taxable Equivalent (FTE) | $ | 26,542 | $ | 18,427 | 44.0 | % | $ | 92,683 | $ | 70,454 | 31.6 | % | ||||||
FTE Adjustment | 1,076 | 871 | 23.5 | % | 4,104 | 2,689 | 52.6 | % | ||||||||||
Net Interest Income | 25,466 | 17,556 | 45.1 | % | 88,579 | 67,765 | 30.7 | % | ||||||||||
Investment Management Fees: | ||||||||||||||||||
Westfield Capital Management | 11,755 | 9,434 | 24.6 | % | 43,829 | 28,492 | 53.8 | % | ||||||||||
Boston Private Bank | 2,962 | 2,633 | 12.5 | % | 11,555 | 9,946 | 16.2 | % | ||||||||||
Sand Hill Advisors | 1,530 | 1,153 | 32.7 | % | 5,682 | 3,849 | 47.6 | % | ||||||||||
Boston Private Value Investors | 1,522 | 1,301 | 17.0 | % | 5,922 | 4,511 | 31.3 | % | ||||||||||
Borel Private Bank | 789 | 657 | 20.1 | % | 2,937 | 2,628 | 11.8 | % | ||||||||||
Dalton, Greiner, Hartman, Maher & Co. | 6,687 | — | nm | 22,222 | — | nm | ||||||||||||
KLS Professional Advisors Group | — | — | nm | — | — | nm | ||||||||||||
Total Investment Management Fees | 25,245 | 15,178 | 66.3 | % | 92,147 | 49,426 | 86.4 | % | ||||||||||
Wealth Advisory Fees | 1,921 | 1,823 | 5.4 | % | 7,898 | 6,951 | 13.6 | % | ||||||||||
Other Fees | 2,031 | 813 | 149.8 | % | 5,352 | 3,926 | 36.3 | % | ||||||||||
Total Fees | 29,197 | 17,814 | 63.9 | % | 105,397 | 60,303 | 74.8 | % | ||||||||||
Earnings in Equity Investments | 804 | 37 | nm | 1,019 | 202 | nm | ||||||||||||
Gain on Sale of Loans, Net | 478 | 151 | 216.6 | % | 1,424 | 2,854 | (50.1 | )% | ||||||||||
Gain on Sale of Investments, Net | — | 594 | (100.0 | )% | 373 | 2,508 | (85.1 | )% | ||||||||||
Total Fees and Other Income | 30,479 | 18,596 | 63.9 | % | 108,213 | 65,867 | 64.3 | % | ||||||||||
Total Revenue | 55,945 | 36,152 | 54.7 | % | 196,792 | 133,632 | 47.3 | % | ||||||||||
Provision for Loan Losses | 1,411 | 820 | 72.1 | % | 4,567 | 3,155 | 44.8 | % | ||||||||||
Salaries and Employee Benefits | 26,340 | 17,356 | 51.8 | % | 93,218 | 62,668 | 48.7 | % | ||||||||||
Occupancy and Equipment | 4,517 | 3,233 | 39.7 | % | 15,702 | 15,634 | 0.4 | % | ||||||||||
Professional Services | 2,172 | 1,305 | 66.4 | % | 7,477 | 5,265 | 42.0 | % | ||||||||||
Marketing and Business Development | 1,304 | 899 | 45.1 | % | 5,148 | 3,647 | 41.2 | % | ||||||||||
Contract Services and Processing | 830 | 587 | 41.4 | % | 2,936 | 1,856 | 58.2 | % | ||||||||||
Amortization of Intangibles | 1,388 | 88 | nm | 4,664 | 239 | nm | ||||||||||||
Other | 2,725 | 1,583 | 72.1 | % | 9,725 | 6,541 | 48.7 | % | ||||||||||
Total Operating Expense | 39,276 | 25,051 | 56.8 | % | 138,870 | 95,850 | 44.9 | % | ||||||||||
Minority Interest | 460 | — | nm | 1,428 | — | nm | ||||||||||||
Income Before Income Taxes | 14,798 | 10,281 | 43.9 | % | 51,927 | 34,627 | 50.0 | % | ||||||||||
Income Tax Expense | 5,332 | 3,403 | 56.7 | % | 18,293 | 12,804 | 42.9 | % | ||||||||||
Net Income | $ | 9,466 | $ | 6,878 | 37.6 | % | $ | 33,634 | $ | 21,823 | 54.1 | % | ||||||
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Boston Private Financial Holdings, Inc.
Selected Financial Data
(Unaudited)
| Three Months Ended | Twelve Months Ended | |||||||||||||||||
| December 31, 2004 | December 31, 2003 | % Change | December 31, 2004 | December 31, 2003 | % Change | |||||||||||||
RECONCILIATION OF GAAP EARNINGS TO ADJUSTED AND CASH EARNINGS: | ||||||||||||||||||
Adjusted Net Income | ||||||||||||||||||
Net Income (GAAP Basis) | $ | 9,466 | $ | 6,878 | 37.6 | % | $ | 33,634 | $ | 21,823 | 54.1 | % | ||||||
Retroactive REIT Tax Adjustment | — | — | nm | — | 1,438 | (100.0 | )% | |||||||||||
Lease Abandonment | — | — | nm | — | 1,544 | (100.0 | )% | |||||||||||
Adjusted Net Income | $ | 9,466 | $ | 6,878 | 37.6 | % | $ | 33,634 | $ | 24,805 | 35.6 | % | ||||||
Cash Basis Earnings (2) | ||||||||||||||||||
Book Amortization of Purchased Intangibles, Net of Tax | 680 | 52 | nm | 2,251 | 140 | nm | ||||||||||||
Cash Benefit of Tax Deductions from Purchased Intangibles & Goodwill | 821 | 160 | nm | 3,259 | 554 | nm | ||||||||||||
Total Cash Basis Adjustment | 1,501 | 212 | nm | 5,510 | 694 | nm | ||||||||||||
Cash Basis Earnings | $ | 10,967 | $ | 7,090 | 54.7 | % | $ | 39,144 | $ | 25,499 | 53.5 | % | ||||||
| Three Months Ended | Twelve Months Ended | |||||||||||||||||
| December 31, 2004 | December 31, 2003 | % Change | December 31, 2004 | December 31, 2003 | % Change | |||||||||||||
PER SHARE DATA: | ||||||||||||||||||
Earnings Per Share | ||||||||||||||||||
Basic Earnings Per Share | $ | 0.35 | $ | 0.29 | 20.7 | % | $ | 1.23 | $ | 0.95 | 29.5 | % | ||||||
Diluted Earnings Per Share | $ | 0.33 | $ | 0.28 | 17.9 | % | $ | 1.18 | $ | 0.92 | 28.3 | % | ||||||
Average Common Shares Outstanding | 27,280 | 23,770 | 14.8 | % | 27,313 | 22,955 | 19.0 | % | ||||||||||
Average Diluted Common Shares Outstanding | 31,005 | 24,896 | 24.5 | % | 28,964 | 23,847 | 21.5 | % | ||||||||||
RECONCILIATION OF GAAP EPS TO ADJUSTED AND CASH EPS: | ||||||||||||||||||
Earnings Per Share (GAAP Basis) | $ | 0.33 | $ | 0.28 | 17.9 | % | $ | 1.18 | $ | 0.92 | 28.3 | % | ||||||
Retroactive REIT Tax Adjustment | — | — | nm | — | $ | 0.06 | (100.0 | )% | ||||||||||
Lease Abandonment | — | — | nm | — | $ | 0.06 | (100.0 | )% | ||||||||||
Eliminate Increase in Shares Outstanding-FAS 128 Revision | — | — | $ | 0.01 | — | nm | ||||||||||||
Adjusted Earnings Per Share | $ | 0.33 | $ | 0.28 | 17.9 | % | $ | 1.19 | $ | 1.04 | 14.4 | % | ||||||
Cash Basis Adjustment | $ | 0.05 | $ | 0.01 | nm | $ | 0.18 | $ | 0.03 | nm | ||||||||
Cash Basis Earnings Per Diluted Share | $ | 0.38 | $ | 0.29 | 31.0 | % | $ | 1.37 | $ | 1.07 | 28.0 | % | ||||||
DETAILED RECONCILIATION OF GAAP AND ADJUSTED EARNINGS
Twelve Months Ended December 31, 2003 | ||||||||||||||
| GAAP Earnings | Retroactive REIT Tax Adjustment | Lease Abandonment | Adjusted Earnings | |||||||||||
Revenues | $ | 133,632 | — | — | $ | 133,632 | ||||||||
Provision for Loan Losses | 3,155 | — | — | 3,155 | ||||||||||
Expenses | 95,850 | (244 | ) | (2,375 | ) | 93,231 | ||||||||
Pre-Tax Income | 34,627 | 244 | 2,375 | 37,246 | ||||||||||
Income Tax Expense | 12,804 | (1,194 | ) | 831 | 12,441 | |||||||||
Net Income | $ | 21,823 | $ | 1,438 | $ | 1,544 | $ | 24,805 | ||||||
Diluted Earnings Per Share | $ | 0.92 | $ | 0.06 | $ | 0.06 | $ | 1.04 | ||||||
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Boston Private Financial Holdings, Inc.
Selected Financial Data
(Unaudited)
| Three Months Ended | Twelve Months Ended | |||||||||||||||||||||
| December 31, 2004 | December 31, 2003 | % Change | December 31, 2004 | December 31, 2003 | % Change | |||||||||||||||||
OPERATING RATIOS & STATISTICS: | ||||||||||||||||||||||
Return on Average Equity | 11.99 | % | 13.99 | % | (14.3 | )% | 11.42 | % | 12.16 | % | (6.1 | )% | ||||||||||
Return on Average Assets | 1.16 | % | 1.24 | % | (6.3 | )% | 1.18 | % | 1.06 | % | 11.3 | % | ||||||||||
Net Interest Margin | 3.61 | % | 3.47 | % | 4.0 | % | 3.61 | % | 3.64 | % | (0.8 | )% | ||||||||||
Core Net Interest Margin(3) | 3.77 | % | 3.47 | % | 8.6 | % | 3.66 | % | 3.64 | % | 0.5 | % | ||||||||||
Total Fees and Other Income/Total Revenue | 54.48 | % | 51.44 | % | 5.9 | % | 54.99 | % | 49.29 | % | 11.6 | % | ||||||||||
Efficiency Ratio | 67.97 | % | 68.88 | % | (1.3 | )% | 67.75 | % | 73.12 | % | (7.3 | )% | ||||||||||
Loans Charged-off, Net of (Recoveries) | $ | (52 | ) | — | nm | $ | 4 | 33 | (87.9 | )% | ||||||||||||
ADJUSTED OPERATING RATIOS: | ||||||||||||||||||||||
Return on Average Equity | 11.99 | % | 13.99 | % | (14.3 | )% | 11.42 | % | 13.83 | % | (17.4 | )% | ||||||||||
Return on Average Assets | 1.16 | % | 1.24 | % | (6.5 | )% | 1.18 | % | 1.21 | % | (2.5 | )% | ||||||||||
Efficiency Ratio | 67.97 | % | 68.88 | % | (1.3 | )% | 67.75 | % | 71.12 | % | (4.7 | )% | ||||||||||
CASH OPERATING RATIOS: | ||||||||||||||||||||||
Return on Average Equity | 13.90 | % | 14.42 | % | (3.6 | )% | 13.30 | % | 14.21 | % | (6.4 | )% | ||||||||||
Return on Average Assets | 1.35 | % | 1.28 | % | 5.5 | % | 1.38 | % | 1.24 | % | 11.3 | % | ||||||||||
| Three Months Ended | Twelve Months Ended | |||||||||||||||||||||
| December 31, 2004 | December 31, 2003 | % Change | December 31, 2004 | December 31, 2003 | % Change | |||||||||||||||||
AVERAGE BALANCE SHEET: | ||||||||||||||||||||||
AVERAGE ASSETS: | ||||||||||||||||||||||
Interest-Bearing Cash | $ | 1,775 | $ | 673 | 163.7 | % | $ | 1,432 | $ | 730 | 96.2 | % | ||||||||||
Federal Funds Sold and Money Market Investments | 166,721 | 135,529 | 23.0 | % | 114,563 | 117,633 | (2.6 | )% | ||||||||||||||
U.S. Treasuries and Agencies | 201,194 | 179,181 | 12.3 | % | 191,576 | 170,524 | 12.3 | % | ||||||||||||||
Municipal Securities | 231,717 | 193,623 | 19.7 | % | 227,724 | 171,780 | 32.6 | % | ||||||||||||||
Corporate Bonds | 30,442 | 15,369 | 98.1 | % | 40,305 | 17,113 | 135.5 | % | ||||||||||||||
Mortgage-Backed Securities | 48,500 | 854 | nm | 49,451 | 1,068 | nm | ||||||||||||||||
Stock in Federal Home Loan Banks | 19,333 | 11,112 | 74.0 | % | 16,436 | 9,721 | 69.1 | % | ||||||||||||||
Commercial Loans | 1,308,253 | 834,897 | 56.7 | % | 1,116,592 | 764,585 | 46.0 | % | ||||||||||||||
Residential Mortgage Loans | 810,172 | 654,055 | 23.9 | % | 732,263 | 604,559 | 21.1 | % | ||||||||||||||
Home Equity and Other Consumer Loans | 90,753 | 79,469 | 14.2 | % | 82,053 | 78,456 | 4.6 | % | ||||||||||||||
Total Earning Assets | 2,908,860 | 2,104,762 | 38.2 | % | 2,572,395 | 1,936,169 | 32.9 | % | ||||||||||||||
Allowance for Loan Losses | (27,077 | ) | (19,594 | ) | 38.2 | % | (24,141 | ) | (18,481 | ) | 30.6 | % | ||||||||||
Goodwill | 110,776 | 17,181 | nm | 82,439 | 16,859 | nm | ||||||||||||||||
Intangible Assets | 46,558 | 3,166 | nm | 39,585 | 2,235 | nm | ||||||||||||||||
Other Assets | 220,906 | 116,274 | 90.0 | % | 174,616 | 114,548 | 52.4 | % | ||||||||||||||
TOTAL AVERAGE ASSETS | $ | 3,260,023 | $ | 2,221,789 | 46.7 | % | $ | 2,844,894 | $ | 2,051,330 | 38.7 | % | ||||||||||
AVERAGE LIABILITIES AND STOCKHOLDERS’ EQUITY: | ||||||||||||||||||||||
Savings Accounts | $ | 36,721 | $ | 25,356 | 44.8 | % | $ | 32,325 | $ | 24,448 | 32.2 | % | ||||||||||
NOW Accounts | 220,992 | 175,772 | 25.7 | % | 211,501 | 189,218 | 11.8 | % | ||||||||||||||
Money Market Accounts | 1,150,360 | 977,495 | 17.7 | % | 1,071,663 | 862,224 | 24.3 | % | ||||||||||||||
Certificates of Deposit | 532,860 | 255,610 | 108.5 | % | 423,125 | 253,659 | 66.8 | % | ||||||||||||||
Total Interest-Bearing Deposits | 1,940,933 | 1,434,233 | 35.3 | % | 1,738,614 | 1,329,549 | 30.8 | % | ||||||||||||||
Repurchase Agreements | 84,175 | 72,279 | 16.5 | % | 76,784 | 72,267 | 6.3 | % | ||||||||||||||
FHLB Borrowings | 258,135 | 200,168 | 29.0 | % | 243,957 | 177,097 | 37.8 | % | ||||||||||||||
Junior Subordinated Debentures | 94,767 | — | nm | 27,438 | — | nm | ||||||||||||||||
Other Borrowings | 5,978 | 33 | nm | 3,996 | 954 | nm | ||||||||||||||||
Total Interest-Bearing Liabilities | 2,383,988 | 1,706,713 | 39.7 | % | 2,090,789 | 1,579,867 | 32.3 | % | ||||||||||||||
Non-interest Bearing Deposits | 476,247 | 280,438 | 69.8 | % | 374,393 | 260,082 | 44.0 | % | ||||||||||||||
Other Liabilities | 84,102 | 37,966 | 121.5 | % | 85,305 | 31,969 | 166.8 | % | ||||||||||||||
Total Liabilities | 2,944,337 | 2,025,117 | 45.4 | % | 2,550,487 | 1,871,918 | 36.2 | % | ||||||||||||||
Stockholders’ Equity | 315,686 | 196,672 | 60.5 | % | 294,407 | 179,412 | 64.1 | % | ||||||||||||||
TOTAL AVERAGE LIABILITIES & STOCKHOLDERS’ EQUITY | $ | 3,260,023 | $ | 2,221,789 | 46.7 | % | $ | 2,844,894 | $ | 2,051,330 | 38.7 | % | ||||||||||
3
Boston Private Financial Holdings, Inc.
Selected Financial Data
(Unaudited)
| December 31, 2004 | September 30, 2004 | % Change | |||||||||
| FINANCIAL DATA: | |||||||||||
Total Balance Sheet Assets | $ | 3,270,277 | $ | 2,903,932 | 12.6 | % | |||||
Stockholders’ Equity | 321,227 | 309,527 | 3.8 | % | |||||||
Tangible Capital: | |||||||||||
Boston Private Bank | 116,164 | 112,869 | 2.9 | % | |||||||
Borel Private Bank | 59,242 | 56,742 | 4.4 | % | |||||||
First State Bank | 29,856 | 21,909 | 36.3 | % | |||||||
Investment Securities | 559,190 | 511,194 | 9.4 | % | |||||||
Goodwill | 130,486 | 87,878 | 48.5 | % | |||||||
Intangible Assets | 56,677 | 43,348 | 30.7 | % | |||||||
Commercial Loans | 1,357,067 | 1,203,679 | 12.7 | % | |||||||
Residential Mortgage Loans | 796,991 | 761,744 | 4.6 | % | |||||||
Home Equity and Other Consumer Loans | 94,542 | 83,484 | 13.2 | % | |||||||
Total Loans | 2,248,600 | 2,048,907 | 9.7 | % | |||||||
Loans Held for Sale | 42,384 | 6,208 | nm | ||||||||
Allowance for Loan Losses | 27,937 | 25,297 | 10.4 | % | |||||||
Non-performing Loans | 1,137 | 2,313 | (50.8 | )% | |||||||
Other Real Estate Owned | 377 | 377 | 0.0 | % | |||||||
Total Non-performing Assets | 1,514 | 2,690 | (43.7 | )% | |||||||
Deposits | 2,386,368 | 2,180,521 | 9.4 | % | |||||||
Borrowings | 474,171 | 342,224 | 38.6 | % | |||||||
Book Value Per Share | $ | 11.61 | $ | 11.23 | 3.4 | % | |||||
Market Price Per Share | $ | 28.17 | $ | 24.96 | 12.9 | % | |||||
| ASSETS UNDER ADVISORY: | |||||||||||
Westfield Capital Management | $ | 7,707,000 | $ | 6,960,000 | 10.7 | % | |||||
Boston Private Bank | 2,010,000 | 1,910,000 | 5.2 | % | |||||||
Sand Hill Advisors | 1,062,000 | 990,000 | 7.3 | % | |||||||
Boston Private Value Investors | 860,000 | 785,000 | 9.6 | % | |||||||
RINET Company | 1,051,000 | 978,000 | 7.5 | % | |||||||
Borel Private Bank | 568,000 | 591,000 | (3.9 | )% | |||||||
Dalton, Greiner, Hartman, Maher & Co. | 3,353,000 | 3,061,000 | 9.5 | % | |||||||
KLS Professional Advisors Group | 2,880,000 | — | nm | ||||||||
Less: Inter-company Relationship | (185,000 | ) | (156,000 | ) | 18.6 | % | |||||
Consolidated Assets Under Advisory | $ | 19,306,000 | $ | 15,119,000 | 27.7 | % | |||||
Coldstream Capital Management | 600,000 | 550,000 | 9.1 | % | |||||||
Bingham, Osborn, & Scarborough | 1,167,000 | 1,057,000 | 10.4 | % | |||||||
Total Unconsolidated Assets Under Advisory | 21,073,000 | $ | 16,726,000 | 26.0 | % | ||||||
| FINANCIAL RATIOS: | |||||||||||
Stockholders’ Equity/Total Assets | 9.82 | % | 10.66 | % | (7.9 | )% | |||||
Non-performing Loans/Total Loans | 0.05 | % | 0.11 | % | (54.5 | )% | |||||
Allowance for Loan Losses/Total Loans | 1.24 | % | 1.23 | % | 0.8 | % | |||||
Allowance for Loan Losses/Non-performing Assets | 1845.24 | % | 940.41 | % | 96.2 | % | |||||
Total Tangible Capital/Total Tangible Assets | 4.35 | % | 6.43 | % | (32.3 | )% | |||||
| Three Months Ended | |||||||||||
| December 31, 2004 | September 30, 2004 | % Change | |||||||||
| OPERATING RESULTS: | |||||||||||
Net Interest Income - (FTE) | $ | 26,542 | $ | 24,065 | 10.3 | % | |||||
FTE Adjustment | 1,076 | 1,056 | 1.9 | % | |||||||
Net Interest Income | 25,466 | 23,009 | 10.7 | % | |||||||
Investment Management Fees: | |||||||||||
Westfield Capital Management | 11,755 | 10,755 | 9.3 | % | |||||||
Boston Private Bank | 2,962 | 2,872 | 3.1 | % | |||||||
Sand Hill Advisors | 1,530 | 1,447 | 5.7 | % | |||||||
Boston Private Value Investors | 1,522 | 1,486 | 2.4 | % | |||||||
Borel Private Bank | 789 | 690 | 14.3 | % | |||||||
Dalton, Greiner, Hartman, Maher & Co. | 6,687 | 5,974 | 11.9 | % | |||||||
KLS Professional Advisors Group | — | — | nm | ||||||||
Total Investment Management Fees | 25,245 | 23,224 | 8.7 | % | |||||||
Wealth Advisory Fees | 1,921 | 1,993 | (3.6 | )% | |||||||
Other Fees | 2,031 | 1,060 | 91.6 | % | |||||||
Total Fees | 29,197 | 26,277 | 11.1 | % | |||||||
Earnings (Loss) in Equity Investments | 804 | 184 | nm | ||||||||
Gain on Sale of Loans, Net | 478 | 252 | 89.7 | % | |||||||
Gain on Sale of Investments, Net | — | 162 | (100.0 | )% | |||||||
Total Fees and Other Income | 30,479 | 26,875 | 13.4 | % | |||||||
Total Revenue | 55,945 | 49,884 | 12.2 | % | |||||||
Provision for Loan Losses | 1,411 | 1,130 | 24.9 | % | |||||||
Salaries and Employee Benefits | 26,340 | 23,012 | 14.5 | % | |||||||
Occupancy and Equipment | 4,517 | 4,006 | 12.8 | % | |||||||
Professional Services | 2,172 | 2,325 | (6.6 | )% | |||||||
Marketing and Business Development | 1,304 | 1,155 | 12.9 | % | |||||||
Contract Services and Processing | 830 | 751 | 10.5 | % | |||||||
Amortization of Intangibles | 1,388 | 1,244 | 11.6 | % | |||||||
Other | 2,725 | 2,315 | 17.7 | % | |||||||
Total Operating Expense | 39,276 | 34,808 | 12.84 | % | |||||||
Minority Interest | 460 | 366 | 25.7 | % | |||||||
Income Before Income Taxes | 14,798 | 13,580 | 9.0 | % | |||||||
Income Tax Expense | 5,332 | 4,800 | 11.1 | % | |||||||
Net Income | $ | 9,466 | $ | 8,780 | 7.8 | % | |||||
4
Boston Private Financial Holdings, Inc.
Selected Financial Data
(Unaudited)
| Three Months Ended | % Change | ||||||||||
| December 31, 2004 | September 30, 2004 | ||||||||||
RECONCILIATION OF GAAP EARNINGS TO ADJUSTED AND CASH EARNINGS: | |||||||||||
Adjusted Net Income | |||||||||||
Net Income (GAAP Basis) | $ | 9,466 | $ | 8,780 | 7.8 | % | |||||
Retroactive REIT Tax Adjustment | — | — | nm | ||||||||
Lease Abandonment | — | — | nm | ||||||||
Adjusted Net Income | $ | 9,466 | $ | 8,780 | 7.8 | % | |||||
Cash Basis Earnings (2) | |||||||||||
Book Amortization of Purchased Intangibles, Net of Tax | 680 | 597 | 13.9 | % | |||||||
Cash Benefit of Tax Deductions from Purchased Intangibles and Goodwill | 821 | 821 | 0.0 | % | |||||||
Total Cash Basis Adjustment | 1,501 | 1,418 | 5.9 | % | |||||||
Cash Basis Earnings | $ | 10,967 | $ | 10,198 | 7.5 | % | |||||
| Three Months Ended | % Change | ||||||||||
| December 31, 2004 | September 30, 2004 | ||||||||||
PER SHARE DATA: | |||||||||||
Earnings Per Share | |||||||||||
Basic Earnings Per Share | $ | 0.35 | $ | 0.32 | 9.4 | % | |||||
Diluted Earnings Per Share | $ | 0.33 | $ | 0.31 | 6.5 | % | |||||
Average Basic Common Shares Outstanding | 27,280 | 27,390 | (0.4 | )% | |||||||
Average Diluted Common Shares Outstanding | 31,005 | 28,522 | 8.7 | % | |||||||
Eliminate Increase in Shares Outstanding - FAS - 128 Revision | — | — | |||||||||
Adjusted Average Diluted Shares Outstanding | 31,005 | 28,522 | 8.7 | % | |||||||
RECONCILIATION OF GAAP EPS TO ADJUSTED AND CASH EPS: | |||||||||||
Earnings Per Share (GAAP Basis) | $ | 0.33 | $ | 0.31 | 6.5 | % | |||||
Retroactive REIT Tax Adjustment | — | — | nm | ||||||||
Lease Abandonment | — | — | nm | ||||||||
Eliminate Increase in Shares Outstanding - FAS 128 Revision | — | — | nm | ||||||||
Adjusted Earnings Per Share | $ | 0.33 | $ | 0.31 | 6.5 | % | |||||
Cash Basis Adjustment | $ | 0.05 | $ | 0.05 | 0.0 | % | |||||
Cash Basis Earnings Per Diluted Share | $ | 0.38 | $ | 0.36 | 5.6 | % | |||||
OPERATING RATIOS & STATISTICS: | |||||||||||
Return on Average Equity | 11.99 | % | 11.59 | % | 3.5 | % | |||||
Return on Average Assets | 1.16 | % | 1.22 | % | (4.9 | )% | |||||
Net Interest Margin | 3.61 | % | 3.68 | % | (1.9 | )% | |||||
Core Net Interest Margin (3) | 3.77 | % | 3.69 | % | 2.2 | % | |||||
Total Fees and Other Income/Total Revenue | 54.48 | % | 53.87 | % | 1.1 | % | |||||
Efficiency Ratio | 67.97 | % | 66.67 | % | 1.9 | % | |||||
Loans Charged-off, Net of Recoveries | $ | (52 | ) | $ | 44 | (218.2 | )% | ||||
5
Boston Private Financial Holdings, Inc.
Selected Financial Data
(Unaudited)
| As Reported December 31, 2004 | December 31, 2003 | % Change | Acquisitions December 31, 2004 | Same Affiliates December 31, 2004 | % Change | ||||||||||||||||
SAME AFFILIATES (1) | |||||||||||||||||||||
Growth Excluding Acquisitions | |||||||||||||||||||||
FINANCIAL DATA: (In Thousands) | |||||||||||||||||||||
Total Balance Sheet Assets | $ | 3,270,277 | $ | 2,196,297 | 48.9 | % | $ | 575,808 | $ | 2,694,469 | 22.7 | % | |||||||||
Stockholders’ Equity | 321,227 | 235,452 | 36.4 | % | 202,651 | 118,576 | (49.6 | )% | |||||||||||||
Tangible Capital: | |||||||||||||||||||||
Boston Private Bank | 116,164 | 103,063 | 12.7 | % | — | 116,164 | 12.7 | % | |||||||||||||
Borel Private Bank | 59,242 | 45,500 | 30.2 | % | — | 59,242 | 30.2 | % | |||||||||||||
First State Bank | 29,856 | — | nm | 29,856 | — | nm | |||||||||||||||
Investment Securities | 559,190 | 407,868 | 37.1 | % | 36,885 | 522,305 | 28.1 | % | |||||||||||||
Goodwill | 130,486 | 17,181 | nm | 113,461 | 17,025 | (0.9 | )% | ||||||||||||||
Intangible Assets | 56,677 | 3,137 | nm | 53,928 | 2,749 | (12.4 | )% | ||||||||||||||
Commercial Loans | 1,357,067 | 880,626 | 54.1 | % | 249,408 | 1,107,659 | 25.8 | % | |||||||||||||
Residential Mortgage Loans | 796,991 | 651,290 | 22.4 | % | 9,824 | 787,167 | 20.9 | % | |||||||||||||
Home Equity and Other Consumer Loans | 94,542 | 80,648 | 17.2 | % | 7,457 | 87,085 | 8.0 | % | |||||||||||||
Total Loans | 2,248,600 | 1,612,564 | 39.4 | % | 266,689 | 1,981,911 | 22.9 | % | |||||||||||||
Loans Held for Sale | 42,384 | 4,900 | nm | 29,585 | 12,799 | 161.2 | % | ||||||||||||||
Allowance for Loan Losses | 27,937 | 20,172 | 38.5 | % | 3,475 | 24,462 | 21.3 | % | |||||||||||||
Non-performing Loans | 1,137 | 1,311 | (13.3 | )% | 152 | 985 | (24.9 | )% | |||||||||||||
Other Real Estate Owned | 377 | — | nm | 377 | — | nm | |||||||||||||||
Total Non-performing Assets | 1,514 | 1,311 | 15.5 | % | 529 | 985 | (24.9 | )% | |||||||||||||
Deposits | 2,386,368 | 1,658,461 | 43.9 | % | 346,321 | 2,040,047 | 23.0 | % | |||||||||||||
Borrowings | 474,171 | 263,620 | 79.9 | % | 114,435 | 359,736 | 36.5 | % | |||||||||||||
ASSETS UNDER ADVISORY: | |||||||||||||||||||||
Westfield Capital Management | $ | 7,707,000 | $ | 6,153,000 | 25.3 | % | — | $ | 7,707,000 | 25.3 | % | ||||||||||
Boston Private Bank | 2,010,000 | 1,986,000 | 1.2 | % | — | 2,010,000 | 1.2 | % | |||||||||||||
Sand Hill Advisors | 1,062,000 | 860,000 | 23.5 | % | — | 1,062,000 | 23.5 | % | |||||||||||||
Boston Private Value Investors | 860,000 | 779,000 | 10.4 | % | — | 860,000 | 10.4 | % | |||||||||||||
RINET Company | 1,051,000 | 800,000 | 31.4 | % | — | 1,051,000 | 31.4 | % | |||||||||||||
Borel Private Bank | 568,000 | 538,000 | 5.6 | % | — | 568,000 | 5.6 | % | |||||||||||||
Dalton, Greiner, Hartman, Maher & Co. | 3,353,000 | — | nm | 3,353,000 | — | nm | |||||||||||||||
KLS Professional Advisors Group | 2,880,000 | — | 2,880,000 | — | nm | ||||||||||||||||
Less: Inter-company Relationship | (185,000 | ) | (150,000 | ) | 23.3 | % | — | (185,000 | ) | 23.3 | % | ||||||||||
Consolidated Assets Under Advisory | $ | 19,306,000 | $ | 10,966,000 | 76.1 | % | 6,233,000 | $ | 13,073,000 | 19.2 | % | ||||||||||
Coldstream Capital Management | $ | 600,000 | 500,000 | 20.0 | % | — | $ | 600,000 | 20.0 | % | |||||||||||
Bingham, Osborn, & Scarborough | $ | 1,167,000 | — | nm | $ | 1,167,000 | — | nm | |||||||||||||
Total Unconsolidated Assets Under Advisory | $ | 21,073,000 | 11,466,000 | 83.8 | % | $ | 7,400,000 | $ | 13,673,000 | 19.2 | % | ||||||||||
| Three Months Ended | |||||||||||||||||||||
| As Reported December 31, 2004 | December 31, 2003 | % Change | Acquisitions December 31, 2004 | Same Affiliates December 31, 2004 | % Change | ||||||||||||||||
OPERATING RESULTS: | |||||||||||||||||||||
Net Interest Income | $ | 26,542 | $ | 18,427 | 44.0 | % | $ | 3,282 | $ | 23,260 | 26.2 | % | |||||||||
FTE Adjustment | 1,076 | 871 | 23.5 | % | — | 1,076 | 23.5 | % | |||||||||||||
Net Interest Income | 25,466 | 17,556 | 45.1 | % | $ | 3,282 | 22,184 | 26.4 | % | ||||||||||||
Investment Management Fees: | |||||||||||||||||||||
Westfield Capital Management | 11,755 | 9,434 | 24.6 | % | — | 11,755 | 24.6 | % | |||||||||||||
Boston Private Bank | 2,962 | 2,633 | 12.5 | % | — | 2,962 | 12.5 | % | |||||||||||||
Sand Hill Advisors | 1,530 | 1,153 | 32.7 | % | — | 1,530 | 32.7 | % | |||||||||||||
Boston Private Value Investors | 1,522 | 1,301 | 17.0 | % | — | 1,522 | 17.0 | % | |||||||||||||
Borel Private Bank | 789 | 657 | 20.1 | % | — | 789 | 20.1 | % | |||||||||||||
Dalton, Greiner, Hartman, Maher & Co. | 6,687 | — | nm | 6,687 | — | nm | |||||||||||||||
KLS Professional Advisors Group | — | — | nm | — | — | nm | |||||||||||||||
Total Investment Management Fees | 25,245 | 15,178 | 66.3 | % | 6,687 | 18,558 | 22.3 | % | |||||||||||||
Wealth Advisory Fees | 1,921 | 1,823 | 5.4 | % | — | 1,921 | 5.4 | % | |||||||||||||
Other Fees | 2,031 | 813 | 149.8 | % | 482 | 1,549 | 90.5 | % | |||||||||||||
Total Fees | 29,197 | 17,814 | 63.9 | % | 7,169 | 22,028 | 23.7 | % | |||||||||||||
Earnings in Equity Investments | 804 | 37 | nm | 127 | 677 | nm | |||||||||||||||
Gain on Sale of Loans, Net | 478 | 151 | 216.6 | % | 281 | 197 | 30.5 | % | |||||||||||||
Gain on Sale of Investments, Net | — | 594 | (100.0 | )% | — | — | nm | ||||||||||||||
Total Fees and Other Income | 30,479 | 18,596 | 63.9 | % | 7,577 | 22,902 | 23.2 | % | |||||||||||||
Total Revenue | 55,945 | 36,152 | 54.7 | % | 10,859 | 45,086 | 24.7 | % | |||||||||||||
Provision for Loan Losses | 1,411 | 820 | 72.1 | % | 101 | 1,310 | 59.8 | % | |||||||||||||
Salaries and Employee Benefits | 26,340 | 17,356 | 51.8 | % | 4,292 | 22,048 | 27.0 | % | |||||||||||||
Occupancy and Equipment | 4,517 | 3,233 | 39.7 | % | 558 | 3,959 | 22.5 | % | |||||||||||||
Professional Services | 2,172 | 1,305 | 66.4 | % | 301 | 1,871 | 43.4 | % | |||||||||||||
Marketing and Business Development | 1,304 | 899 | 45.1 | % | 154 | 1,150 | 27.9 | % | |||||||||||||
Contract Services and Processing | 830 | 587 | 41.4 | % | 215 | 615 | 4.8 | % | |||||||||||||
Amortization of Intangibles | 1,388 | 88 | nm | 1,303 | 85 | (3.4 | )% | ||||||||||||||
Other | 2,725 | 1,583 | 72.1 | % | 706 | 2,019 | 27.5 | % | |||||||||||||
Total Operating Expense | 39,276 | 25,051 | 56.8 | % | 7,529 | 31,747 | 26.7 | % | |||||||||||||
Minority Interest | 460 | — | nm | 460 | — | nm | |||||||||||||||
Income Before Income Taxes | 14,798 | 10,281 | 43.9 | % | 2,769 | 12,029 | 17.0 | % | |||||||||||||
Income Tax Expense | 5,332 | 3,403 | 56.7 | % | 1,370 | 3,962 | 16.4 | % | |||||||||||||
Net Income | $ | 9,466 | $ | 6,878 | 37.6 | % | $ | 1,399 | $ | 8,067 | 17.3 | % | |||||||||
6
Boston Private Financial Holdings, Inc.
Selected Financial Data
(Unaudited)
| Twelve Months Ended | ||||||||||||||||||
| As Reported December 31, 2004 | December 31, 2003 | % Change | Acquisitions December 31, 2004 | Same Affiliates December 31, 2004 | % Change | |||||||||||||
OPERATING RESULTS: | ||||||||||||||||||
Net Interest Income - (FTE) | $ | 92,683 | $ | 70,454 | 31.6 | % | $ | 9,125 | $ | 83,558 | 18.6 | % | ||||||
FTE Adjustment | 4,104 | 2,689 | 52.6 | % | — | 4,104 | 52.6 | % | ||||||||||
Net Interest Income | 88,579 | 67,765 | 30.7 | % | $ | 9,125 | 79,454 | 17.2 | % | |||||||||
Investment Management Fees: | ||||||||||||||||||
Westfield Capital Management | 43,829 | 28,492 | 53.8 | % | — | 43,829 | 53.8 | % | ||||||||||
Boston Private Bank | 11,555 | 9,946 | 16.2 | % | — | 11,555 | 16.2 | % | ||||||||||
Sand Hill Advisors | 5,682 | 3,849 | 47.6 | % | — | 5,682 | 47.6 | % | ||||||||||
Boston Private Value Investors | 5,922 | 4,511 | 31.3 | % | — | 5,922 | 31.3 | % | ||||||||||
Borel Private Bank | 2,937 | 2,628 | 11.8 | % | — | 2,937 | 11.8 | % | ||||||||||
Dalton, Greiner, Hartman, Maher & Co. | 22,222 | — | nm | 22,222 | — | nm | ||||||||||||
KLS Professional Advisors Group | — | — | nm | — | — | nm | ||||||||||||
Total Investment Management Fees | 92,147 | 49,426 | 86.4 | % | 22,222 | 69,925 | 41.5 | % | ||||||||||
Wealth Advisory Fees | 7,898 | 6,951 | 13.6 | % | — | 7,898 | 13.6 | % | ||||||||||
Other Fees | 5,352 | 3,926 | 36.3 | % | 1,328 | 4,024 | 2.5 | % | ||||||||||
Total Fees | 105,397 | 60,303 | 74.8 | % | 23,550 | 81,847 | 35.7 | % | ||||||||||
(Loss) Earnings In Equity Investments | 1,019 | 202 | nm | 453 | 566 | 180.2 | % | |||||||||||
Gain on Sale of Loans, Net | 1,424 | 2,854 | (50.1 | )% | 433 | 991 | (65.3 | )% | ||||||||||
Gain on Sale of Investments, Net | 373 | 2,508 | (85.1 | )% | — | 373 | (85.1 | )% | ||||||||||
Total Fees and Other Income | 108,213 | 65,867 | 64.3 | % | 24,436 | 83,777 | 27.2 | % | ||||||||||
Total Revenue | 196,792 | 133,632 | 47.3 | % | 33,561 | 163,231 | 22.1 | % | ||||||||||
Provision for Loan Losses | 4,567 | 3,155 | 44.8 | % | 307 | 4,260 | 35.0 | % | ||||||||||
Salaries and Employee Benefits | 93,218 | 62,668 | 48.7 | % | 12,564 | 80,654 | 28.7 | % | ||||||||||
Occupancy and Equipment | 15,702 | 15,634 | 0.4 | % | 1,336 | 14,366 | (8.1 | )% | ||||||||||
Professional Services | 7,477 | 5,265 | 42.0 | % | 899 | 6,578 | 24.9 | % | ||||||||||
Marketing and Business Development | 5,148 | 3,647 | 41.2 | % | 444 | 4,704 | 29.0 | % | ||||||||||
Contract Services and Processing | 2,936 | 1,856 | 58.2 | % | 707 | 2,229 | 20.1 | % | ||||||||||
Amortization of Intangibles | 4,664 | 239 | nm | 4,318 | 346 | 44.8 | % | |||||||||||
Other | 9,725 | 6,541 | 48.7 | % | 1,887 | 7,838 | 19.8 | % | ||||||||||
Total Operating Expenses | 138,870 | 95,850 | 44.9 | % | 22,155 | 116,715 | 21.8 | % | ||||||||||
Minority Interest | 1,428 | — | nm | 1,428 | — | nm | ||||||||||||
Income Before Taxes | 51,927 | 34,627 | 50.0 | % | 9,671 | 42,256 | 22.0 | % | ||||||||||
Income Tax Expense | 18,293 | 12,804 | 42.9 | % | 4,261 | 14,032 | 9.6 | % | ||||||||||
Net Income | $ | 33,634 | $ | 21,823 | 54.1 | % | $ | 5,410 | $ | 28,224 | 29.3 | % | ||||||
| (1) | These amounts exclude Dalton, Greiner, Hartman, Maher & Co., First State Bank, Bingham Osborn & Scarborough, and KLS Professional Advisors Group and interest on the subordinated debentures. This data is shown for comparative purposes only to indicate the growth without the acquisitions made in 2004 |
7
Boston Private Financial Holdings, Inc.
Selected Financial Data
(Unaudited)
| (2) | The Company defines Cash Basis Earnings as adjusted earnings, plus the amortization of the purchased intangibles (net of tax), plus the tax benefit on the portion of the purchase price which is deductible over a 15 year life. |
These tax savings are deferred under GAAP accounting but are included in cash earnings since the tax savings (lower tax payment) will be retained unless the acquired company is sold.
| (3) | The Company defines Core Net Interest Margin as Net Interest Margin excluding the interest expense on the Junior Subordinate Debentures. |
8
