UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of Earliest Event Reported): January 27, 2011
Boston Private Financial Holdings, Inc.
(Exact Name of Registrant as Specified in its Charter)
| | |
| Massachusetts | 0-17089 | 04-2976299 |
| (State or other jurisdiction of incorporation) | (Commission File Number) | (IRS Employer Identification Number) |
Ten Post Office Square, Boston, Massach usetts 02109
(Address of principal executive offices)
(617) 912-1900
(Registrant's telephone number, including area code)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Item 8.01. Other Events.
Boston Private Financial Holdings, Inc. (NASDAQ: BPFH) (the “Company” or “BPFH”) today reported a fourth quarter 2010 GAAP Net Loss Attributable to the Company of $10 million, compared to a $7.2 million net loss in the third quarter of 2010. The net loss for the fourth quarter was primarily driven by $32.6 million in Provision for Loan Losses, largely attributable to continued credit-related stress in the commercial real estate (“CRE”) portfolio at the Company's Northern California banking affiliate.
After accounting for non-cash equity adjustments and preferred dividends, BPFH reported a fourth quarter 2010 GAAP net loss per share of $0.14 compared to a $0.10 GAAP net loss per share in t he third quarter of 2010.
For the full year 2010, the Company reported a GAAP net loss of $11 million, compared to GAAP net income of $5.2 million for 2009. After accounting for non-cash equity adjustments and preferred dividends, BPFH reported a 2010 GAAP net loss per share of $0.29, compared to a $0.52 GAAP net loss per share for 2009.
In addition to reporting fourth quarter results, the Company made two additional restructuring announcements.
The BPFH board of directors has approved a plan to merge the Company's four private banks into one consolidated banking entity. While subject to regulatory and related approvals, the Company intends to begin immediately working on a 12-month integration program. The Company believes that the integration, when fully implemented, will result in estimated cost savings of up to 9% of the Company's current banking cost base.
In a separate announcement, BPFH's wealth advisory affiliate Coldstream Holdings, Inc. announced today that it has repurchased all of BPFH's stock holdings in the firm. BPFH had been a minority shareholde r of Coldstream since 2002. Coldstream contributed less than $0.1 million to the Company's total revenue in 2010. This transaction is expected to result in a pre-tax gain of $0.5 million in the first quarter of 2011.
Key Financials (Note: All comparisons relate only to continuing operations).
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| • | Revenue for the fourth quarter was $76.4 million, an increase of $2.6 million, or 4%, from $73.7 million on a linked quarter basis. On a year to date basis, Revenue was up 2% to $292.5 million. |
| |
| ◦ | Net Interest Income for the fourth quarter was $45 million, a decrease of $1.5 million, or 3%, from $46.4 million on a linked quarter basis. On a year to date basis, Net Interest Income was up 13% to $180.7 million. |
| |
| ◦ | Fee Income (Investment Management, Wealth Advisory and Other Private Banking Fees) for the fourth quarter was $26.7 million, an increase of $1.2 million , or 5%, from $25.5 million on linked quarter basis. On a year to date basis, Fee Income was up 10%, to $103.5 million. |
| |
| • | Net Interest Margin for the fourth quarter was 3.18%, down 24 basis points from 3.42% on a linked quarter basis, primarily due to the expiration of an interest rate hedge in November, the impact of new non accrual loans in both the fourth quarter and late in the third quarter, as well as residential loans that repriced at lower rates. Net Interest Margin for the year was 3.30%, up 21 basis points from the prior year, primarily due to BPFH's banking subsidiaries' lower deposit rates, CDs maturing and repricing at lower rates or shifting to lower-cost money market accounts, and FHLB borrowings maturing and repricing at lower rates. |
| |
| • | Operating Expenses f or the fourth quarter were $63.2 million, an increase of $2.2 million, or 4%, from $61 million on a linked quarter basis, primarily due to a legal settlement at the Company's Southern California bank. On a year to date basis, Operating Expenses were up 6% to $236.9 million, primarily due to the increase in Salaries and Benefit expenses as a result of certain separation and retirement expenses, increased fixed compensation, and increases in variable and equity compensation as a result of savings recognized in 2009. |
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| • | Total Balance Sheet Assets as of the end of the fourth quarter were $6.2 billion, an increase of $121.6 million, or 2%, from $6.0 billion as of the end of the third quarter and were up 2% from $6.0 billion as of the end of 2009. |
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| • | Provision for Loan Losses for the fourth quarter was $32.6 million, an increase of $0.5 million, or 2%, from $32.1 million on a linked quarter basis. On a year to date basis, Provision for Loan Losses was $87.2 million, up 94% from $45 million as of the end of 2009, primarily due to further degradation of criticized CRE loans in the portfolio of the Company's Northern California bank. |
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| • | Allowance for Loan Losses as a percentage of Total Loans as of the end of the fourth quarter was 2.20%, down 1 basis point from 2.21%, as of the end of the third quarter and up 61 basis points from 1.59% as of the end of 2009. The year-over-year increase is primarily due to increased levels of classified loans and continued loan charge-offs, particularly in Northern California, other qualitative risk factors, and growth in the loan portfolio, offset slightly by a change in the mix of loan types in the loan portfolio. |
Total Deposits w ere flat on a linked quarter basis at $4.5 billion and were up 5% from $4.3 billion as of the end of 2009. Total Loans decreased 1% as of the end of the fourth quarter to $4.5 billion from the end of the third quarter, and were up 4% from $4.3 billion as of the end of 2009.
Non-Performing Loans for the fourth quarter were $107 million, a decrease of $36.1 million, or 25% from $143.1 million on a linked quarter basis. Non-Performing Loans as a percentage of Total Loans were 2.39% as of the end of the fourth quarter, down from 3.16% as of the end of the third quarter of 2010. The decline in Non-Performing Loans was the result of charge-offs, resolutions, and a slow down of new problem loans. Net Charge-offs for the fourth quarter 2010 were $34.2 million, which represen ted approximately 76 basis points of Total Loans, compared to $11.1 million of Net Charge-offs during the third quarter 2010, or 25 basis points of Total Loans. Past Due Loans (30-89 days) as a percentage of Total Loans increased 18 basis points on a linked quarter basis to 0.55%.
Total Assets Under Management/Advisory (“AUM”) increased 5%, or $932 million, to $19.5 billion in the fourth quarter. Total AUM was up 11% on a year-over-year basis. The Company experienced fourth quarter AUM inflows of $69 million, as compared to $2 million of inflows in the prior quarter. AUM inflows for the year were $151 million.
Dividend Payments
Concurrent with the release of the fourth quarter 2010 earnings, the Board of Directors of the Company declared a cash dividend to shareholders of $0.01 per share. The record date for this dividend is February 14, 2011 and the payment date is February 28, 2011.
Forward-Looking Statements
Statements in this press release that are not historical facts are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and are intended to be covered by the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve risks and uncertainties. These statements include, among others, statements regarding our strategy, evaluations of future interest rate trends and liquidity, prospects for growth in assets, 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 the Company's control. Forward-looking statements are based on the cu rrent assumptions and beliefs of management and are only expectations of future results. The Company's actual results could differ materially from those projected in the forward-looking statements as a result of, among other factors, changes in assumptions or unanticipated factors adversely affecting the timing, among other matters, of expenses or cost savings relating to or resulting from the consolidation of the Company's banking subsidiaries; adverse conditions in the capital and debt markets and the impact of such conditions on the Company's private banking, investment management and wealth advisory activities; changes in interest rates; competitive pressures from other financial institutions; the effects of a continuing deterioration in general economic conditions on a national basis or in the local markets in which the Company operates, including changes which adversely affect borrowers' ability to service and repay our loans; changes in loan defaults and charge-off rates; changes in the value of sec urities and other assets, adequacy of loan loss reserves, or deposit levels necessitating increased borrowing to fund loans and investments; increasing government regulation, such as the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010; the risk that goodwill and intangibles recorded in the Company's financial statements will become impaired; risks related to the identification and implementation of acquisitions; changes in assumptions used in making such forward-looking statements; and the other risks and uncertainties detailed in the Company's Annual Report on Form 10-K and updated by the Company's Quarterly Reports on Form 10-Q; and other filings submitted to the Securities and Exchange Commission. The Company 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.
Boston Private Financial Holdings, Inc.
Selected Financial Data (1)
(In Thousands, except share data)
(Unaudited)
| | | | | | | | | |
| (In thousands, except per share data) | December 31, 2 010 | December 31, 2009 | September 30, 2010 |
| FINANCIAL DATA: |
| Total Balance Sheet Assets (1) | $ | 6,152,901 | | $ | 6,049,265 | | $ | 6,031,266 | |
| Total Equity | 518,878 | | 651,154 | | 533,762 | |
| Cash and Investment Securities | 1,338,238 | | 1,387,483 | | 1,157,657 | |
| | | | |
| Commercial Loans | 2,356,233 | | 2,213,020 | | 2,386,378 | |
| Construction and Land Loans | 150,702 | | 315,661 | | 210,915 | |
| Residential Mortgage Loans | 1 ,673,934 | | 1,494,703 | | 1,634,958 | |
| Home Equity and Other Consumer Loans | 299,478 | | 283,656 | | 298,023 | |
| Total Loans | 4,480,347 | | 4,307,040 | | 4,530,274 | |
| | | | |
| Loans Held for Sale | 9,145 | | 12,714 | | 22,290 | |
| Other Real Estate Owned ("OREO") | 12,925 | &nbs p; | 16,600 | | 13,069 | |
| | | | |
| Deposits | 4,486,726 | | 4,255,219 | | 4,492,516 | |
| Borrowings | 1,027,925 | | 992,034 | | 886,741 | |
| | | | |
| Book Value Per Common Share | $ | 6.04 | | $ | 6.51 | | $ | 6.21 | |
| Market Price Per Share | $ | 6.55 | | $ | 5.77 | | $ | 6.54 | |
| | | | |
| ASSETS UNDER MANAGEMENT AND ADVISORY: | | | |
| Private Banking | $ | 3,592,000 | | $ | 3,479,000 | | $ | 3,561,000 | |
| Investment Managers | 8,140,000 | | 7,048,000 | | 7,521,000 | |
| Wealth Advisory | 7,836,000 | | 7,161,000 | | 7,553,000 | |
| Less: Inter-company Relationship | (19,000 | ) | (18,000 | ) | (18,000 | ) |
| Assets Under Management and Advisory | $ | 19,549,000 | | $ | 17,670,000 | | $ | 18,617,000 | |
| | | | &n bsp; |
| FINANCIAL RATIOS: | | | |
| Total Equity/Total Assets | 8.43 | % | 10.76 | % | 8.85 | % |
| Allowance for Loan Losses/Total Loans | 2.20 | % | 1.59 | % | 2. 21 | % |
| Allowance for Loan Losses/Non-Accrual Loans | 93 | % | 79 | % | 71 | % |
Boston Private Financial Holdings, Inc.
Selected Financial Data (1)
(In Thousands, except share data)
(Unaudited)
| | | | | | | | | | | | | | | | |
| | Three Months Ended | | Twelve Months Ended |
| | Dec 31, | Dec 31, | Sept 30, | | Dec 31, | Dec 31, |
| OPERATING RESULTS: | 2010 | 2009 | 2010 | | 2010 | 2009 |
| Net Interest Income | $ | 44,953 | | $ | 41,057 | | $ | 46,444 | | | $ | 180,725 | | $ | 159,485 | |
| Investment Management and Trust Fees: | | | | | | |
| Private Banking | 5,744 | | 5,482 | | 5,599 | | | 22,826 | | 20,810 | |
| Investment Managers | 9,682 | | 9,029 | | 8,712 | | | 36,941 | | 33,189 | |
| Total Investment Management and Trust Fees | 15,426 | | 14,511 | | 14,311 | | | 59,767 | | 53,999 | |
| Total Wealth Advisory Fees | 9,787 | | 9,138 | | 9,525 | | | 37,874 | | 34,834 | |
| Other Private Banking Fees | 1,513 | | 1,249 | | 1,678 | | | 5,832 | | 5,652 | |
| Total Fees | 26,726 | | 24,898 | | 25,514 | | | 103,473 | | 94,485 | |
| Gain on Repurchase of Debt | — | | 18,332 | | — | | | — | | 18,739 | |
| Gain/(Loss) on Sale of Loans and OREO, net | 3,385 | | (2,120 | ) | 713 | | | 2,410 | | 4,302 | |
| Other Revenue, Gains and (Losses), net (3) | 1,301 | | 1,254 | | 1,072 | | | 5,889 | | 8,923 | |
| Total Fees and Other Income | 31,412 | | 42,364 | | 27,299 | | | 111,772 | | 126,449 | |
| Total Revenue | 76,365 | | 83,421 | | 73,743 | | | 292,497 | | 285,934 | |
| | | | | &n bsp; | | |
| Provision for Loan Losses | 32,551 | | 13,804 | | 32,050 | | | 87,178 | | 44,959 | |
| | | | | | | |
| Salaries and Employee Benefits | 36,084 | | 32,434 | | 38,662 | | | 143,248 | | 127,707 | |
| Occupancy and Equipment | 7,254 | | 6,981 | | 7,036 | | | 27,773 | | 26,818 | |
| Professional Services | 5,470 | | 5,479 | | 4,857 | | | 19,495 | | 19,841 | |
| FDIC Insurance | 2,113 | | 2,012 | | 2,137 | | | 8,603 | | 9,746 | |
| Other Operating Expenses (4) | 12,256 | | 10,833 | | 8,287 | | | 37,736 | | 38,846 | |
| Total Operating Expense | 63,177 | | 57,739 | | 60,979 | | | 236,855 | | 222,958 | |
| | | | | | | |
| Income/(Loss) from Continuing Operations, before Tax | (19,363 | ) | 11,878 | | (19,286 | ) | | (31,536 | ) | 18,017 | |
| Income Tax Expense/(Benefit) | (8,172 | ) | 2 | | (12,412 | ) | | (19,451 | ) | 1,632 | |
| Net Income/(Loss) from Continuing Operations | (11,191 | ) | 11,876 | | (6,874 | ) | | (12,085 | ) | 16,385 | |
| Discontinued Operations, Net of Tax (1) | 1,917 | | 31,501 | | 267 | | | 3,729 | | (7,505 | ) |
| Net Income/(Loss) before Attribution to Noncontrolling Interest | (9,274 | ) | 43,377 | | (6,607 | ) | | (8,356 | ) | 8,880 | |
| Less: Net Income Attributable to the Noncontrolling Interest | 684 | | 1,169 | | 629 | | | 2,614 | | 3,649 | |
| Net Income/(Loss) Attributable to the Company | $ | (9,958 | ) | $ | 42,208 | | $ | (7,236 | ) | | $ | (10,970 | ) | $ | 5,231 | |
Boston Private Financial Holdings, Inc.
Selected Financial Data (1)
(In Thousands, except share data)
(Unaudited)
| | | | | | | | | | | | | | | | |
| | Three Months Ended | | Twelve Months Ended |
| | Dec 31, | Dec 31, | Sept 30, | | Dec 31, | Dec 31, |
| PER SHARE DATA: | 2010 | 2009 | 2010 | | 2010 | 2009 |
| Calculation of Income/(Loss) for EPS: | | | | | | |
| Net Income/(Loss) from Continuing Operations | $ | (11,191 | ) | $ | 11,876 | | $ | (6,874 | ) | | $ | (12,085 | ) | $ | 16,385 | |
| Less: Net Income Attributable to Noncontrolling Interests | 684 | | 1,169 | | 629 | | | 2,614 | | 3,649 | |
| Net Income/(Loss) from Continuing Operations Attributable to the Company | $ | (11,875 | ) | $ | 10,707 | | $ | (7,503 | ) | | $ | (14,699 | ) | $ | 12,736 | |
| Adjustments to Net Income/(Loss) Attributable to the Company to Arrive at Net Income/(Loss) Attributable to Common Shareholders (5) | (300 | ) | (13,873 | ) | 163 | | | (9,766 | ) | (40,231 | ) |
| Net Income/(Loss) from Continuing Operations Attributable to the Common Shareholders | $ | (12,175 | ) | $ | (3,166 | ) | $ | (7,340 | ) | | $ | (24,465 | ) | $ | (27,495 | ) |
| Net Income/(Loss) from Discontinued Operations | $ | 1,917 | | $ | 31,501 | | $ | 267 | | | $ | 3,729 | | $ | (7,505 | ) |
| Net Income/(Loss) Attributable to the Common Shareholder | $ | (10,258 | ) | $ | 28,335 | | $ | (7,073 | ) | | $ | (20,736 | ) | $ | (35,000 | ) |
| | | | | | | |
| Calculation of Average Shares Outstanding: | | | | | | |
| Weighted Average Basic and Diluted Shares | 74,371 | | 67,637 | | 74,154 | | | 71,321 | | 66,697 | |
| | | | | | | |
| Earnings/(Loss) per Share - Basic and Diluted | | | | | | |
| Earnings/(Loss) per Share from Continuing Operations | $ | (0.16 | ) | $ | (0.05 | ) | $ | (0.10 | ) | | $ | (0.34 | ) | $ | (0.41 | ) |
| Income/(Loss) per Share from Discontinued Operations | $ | 0.02 | | $ | 0.47 | | $ | — | | | $ | 0.05 | | $ | (0.11 | ) |
| Earnings/(Loss) per Share | $ | (0.14 | ) | $ | 0.42 | | $ | (0.10 | ) | | $ | (0.29 | ) | $ | (0.52 | ) |
Boston Private Financial Holdings, Inc.
Selected Financial Data (1)
(In Thousands, except share data)
(Unaudited)
| | | | | | | | | | | | | | | | | | | | | | | | |
| | Average Balance | Interest Income/Expense | Average Yeild/Rate |
| | Thr ee Months Ended | Three Months Ended | Three Months Ended |
| | Dec 31, | Dec 31, | Sept 30, | Dec 31, | Dec 31, | Sept 30, | Dec 31, | Dec 31, | Sept 30, |
| AVERAGE BALANCE SHEET: | 2010 | 2009 | 2010 | 2010 | 2009 | 2010 | 2010 | 2009 | 2010 |
| AVERAGE ASSETS | | | | | | | | | |
| Earning Assets | | | | | | | | | |
| Cash and Investments (6) | $ | 1,303,356 | | $ | 1,412,415 | | $ | 1,084,506 | | $ | 5,518 | | $ | 6,684 | | $ | 5,689 | | 1.69 | % | 1.89 | % | 2.10 | % |
| Loans (7) | | | | | | | | | |
| Commercial and Construction (6) | 2,568,964 | | 2,637,992 | | 2,587,847 | | 34,920 | | 37,395 | | 36,481 | | 5.35 | % | 5.62 | % | 5.56 | % |
| Residential Mortgage | 1,660,775 | | 1,478,772 | | 1,637,831 | | 19,183 | | 18,883 | | 19,621 | | 4.61 | % | 5.11 | % | 4.79 | % |
| Home Equity and Other Consumer | 300,273 | | 214,088 | | 295,395 | | 3,064 | | 2,500 | | 3,116 | | 4.02 | % | 4.59 | % | 4.16 | % |
| Total Earning Assets | 5,833,368 | | 5,743,267 | | 5,605,579 | | 62,685 | | 65,462 | | 64,907 | | 4.25 | % | 4.53 | % | 4.59 | % |
| Allowance for Loan Losses | (99,025 | ) | (73,613 | ) | (81,543 | ) | | | | | | |
| Cash and due From Banks (Non-Interest Bearing) | 32,516 | | 27,113 | | 27,983 | | | | | | | |
| Other Assets | 441,632 | | 580,466 | | 443,124 | | | | | | | |
| TOTAL AVERAGE ASSETS | $ | 6,208,491 | | $ | 6,277,233 | | $ | 5,995,143 | | | | | | | |
| | | | | | | | | | |
| AVERAGE LIABILITIES AND STOCKHOLDERS' EQUITY | | | | | | | | | |
| Interest-Bearing Liabilities: | | | | | | | | | |
| Deposits: | | | | | | | | | |
| Savings and NOW | $ | 608,474 | | $ | 492,295 | | $ | 559,413 | | 454 | | $ | 728 | | $ | 467 | | 0.30 | % | 0.59 | % | 0.33 | % |
| Money Market | 1,814,159 | | 1,576,760 | | 1,698,381 | | 3,718 | | 4,521 | | 3,821 | | 0.81 | % | 1.14 | % | 0.89 | % |
| Certificates of Deposits | 1,183,250 | | 1,569,426 | | 1,277,670 | | 3,877 | | 7,622 | | 4,422 | | 1.30 | % | 1.93 | % | 1.37 | % |
| Total Deposits | 3,605,883 | | 3,638,481 | | 3,535,464 | | 8,049 | | 12,871 | | 8,710 | | 0.89 | % | 1.40 | % | 0.98 | % |
| Junior Subordinated Debentures and Other Long-term Debt | 193,645 | | 215,895 | | 193,645 | | 2,523 | | 2,851 | | 2,511 | | 5.21 | % | 5.28 | % | 5.19 | % |
| FHLB Borrowings and Other | 685,208 | | 721,999 | | 614,459 | | 5,293 | | 6,916 | | 5,392 | | 3.02 | % | 3.75 | % | 3.43 | % |
| Total Interest-Bearing Liabilities | 4,484,736 | | 4,576,375 | | 4,343,568 | | 15,865 | | 22,638 | | 16,613 | | 1.40 | % | 1.96 | % | 1.51 | % |
| Non-interest Bearing Demand Deposits | 1,063,592 | | 906,351 | | 986,892 | | | | | | | |
| Payables and Other Liabilities | 112,406 | | 98,229 | | 104,806 | | | | | | | |
| Total Liabilitie s | 5,660,734 | | 5,580,955 | | 5,435,266 | | | | | | | |
| Redeemable Non-Controlling Interest | 19,070 | | 53,177 | | 19,542 | | | | | | | |
| Stockholders' Equity | 528,687 | | 643,101 | | 540,335 | | & nbsp; | | | | | |
| TOTAL AVERAGE LIABILITIES & STOCKHOLDERS' EQUITY | $ | 6,208,491 | | $ | 6,277,233 | | $ | 5,995,143 | | | | | | | |
| | | | | | | | | | |
| Net Interest Income - on a Fully Taxable Equivalent Basis (FTE) | | | | $ | 46,820 | | $ | 42,824 | | $ | 48,294 | | | | |
| FTE Adjustment (6) | | | | 1,867 | | 1, 767 | | 1,850 | | | | |
| Net Interest Income (GAAP Basis) | | | | $ | 44,953 | | $ | 41,057 | | $ | 46,444 | | | | |
| Interest Rate Spread | | | | | | | 2.85 | % | 2.57 | % | 3.08 | % |
| Net Interest Margin | | | | | | | 3.18 | % | 2.97 | % | 3.42 | % |
Boston Private Financial Holdings, Inc.
Selected Financial Data (1)
(In Thousands, except share data)
(Unaudited)
| | | | | | | | | | | | | | | | |
| | Average Balance | Interest Income/Expense | Average Yeild/Rate |
| | Twelve Months Ended | Twelve Months Ended | Twelve Months Ended |
| | Dec 31, | Dec 31, | Dec 31, | Dec 31, | Dec 31, | Dec 31, |
| AVERAGE BALANCE SHEET: | 2010 | 2009 | 2010 | 2009 | 2010 | 2009 |
| AVERAGE ASSETS | | | | | | |
| Earning Assets | | | | | | |
| Cash and Investments (6) | $ | 1,255,767 | | $ | 1,127,045 | | $ | 23,360 | | $ | 30,530 | | 1.86 | % | 2.71 | % |
| Loans (7) | | | | | | |
| Commercial and Construction (6) | 2,567,009 | | 2,679,722 | | 144,402 | | 154,358 | | 5.63 | % | 5.76 | % |
| Residential Mortgage | 1,595,056 | | 1,377,159 | | 76,940 | | 72,214 | | 4.82 | % | 5.24 | % |
| Home Equity and Other Consumer | 286,044 | | 206,894 | | 12,482 | | 9,321 | | 4.36 | % | 4.51 | % |
| Total Earning Assets | 5,703,876 | | 5,390,820 | | 257,184 | | 266,423 | | 4.51 | % | 4.94 | % |
| Allowance for Loan Losses | (81,393 | ) | (70,771 | ) | | | | |
| Cash and due From Banks (Non-Interest Bearing) | 30,375 | | 25,677 | | | | | |
| Other Assets | 485,170 | | 610,657 | | | | | |
| TOTAL AVERAGE ASSETS | $ | 6,138,028 | | $ | 5,956,383 | | | | | |
| | | | | | | |
| AVERAGE LIABILITIES AND STOCKHOLDERS' EQUITY | | | | | | |
| Interest-Bearing Liabilities: | | | | | | |
| Deposits: | | | | | | |
| Savings and NOW | $ | 555,244 | | $ | 457,280 | | $ | 2,029 | | $ | 3,240 | | 0.37 | % | 0.71 | % |
| Money Market | 1,701,772 | | 1,315,082 | | 15,223 | | 19,518 | | 0.89 | % | 1.48 | % |
| Certificates of Deposits | 1,316,818 | | 1,525,844 | | 19,518 | | 36,114 | | 1.48 | % | 2.37 | % |
| Total Deposits | 3,573,834 | | 3,298,206 | | 36,770 | | 58,872 | | 1.03 | % | 1.78 | % |
| Junior Subordinated Debentures and Other Long-term Debt | 193,645 | | 240,419 | | 10,028 | | 12,324 | | 5.18 | % | 5.13 | % |
| FHLB Borrowings and Other | 648,226 | | 817,830 | | 22,414 | | 28,633 | | 3.46 | % | 3.50 | % |
| Total Interest-Bearing Liabilities | 4,415,705 | | 4,356,455 | | 69,212 | | 99,829 | | 1.57 | % | 2.29 | % |
| Non-interest Bearing Demand Deposits | 1,025,431 | | 846,916 | | | | | |
| Payables and Other Liabilities | 103,836 | | 62,599 | | | | | |
| Total Liabilities | 5,544,972 | | 5,265,970 | | | | | |
| Redeemable Non-Controlling Interest | 20,175 | | 42,119 | | | | | |
| Stockholders' Equity | 572,881 | | 648,294 | | | | | |
| TOTAL AVERAGE LIABILITIES & STOCKHOLDERS' EQUI TY | $ | 6,138,028 | | $ | 5,956,383 | | | | | |
| | | | | | | |
| Net Interest Income - on an FTE Basis | | | $ | 187,972 | | $ | 166,594 | | | |
| FTE Adjustment (6) | | | 7,247 | | 7,109 | | | |
| Net Interest Income (GAAP Basis) | | | $ | 180,725 | | $ | 159,485 | | | |
| Interest Rate Spread | | | | | 2.94 | % | 2.65 | % |
| Net Interest Margin | | | | | 3.30 | % | 3.09 | % |
| | | | | | | | |
| | Three Months Ended | | Twelve Months Ended |
| | Dec 31, | Dec 31, | Sept 30, | | Dec 31, | Dec 31, |
| | 2010 | 2009 | 2010 | | 2010 | 2009 |
| OPERATING RATIOS: | | | | | | |
| Return on Average Equity | (7.53%) | 26.25 | % | (5.36%) | | (1.91%) | 0.81 | % |
| Return on Average Assets | (0.64%) | 2.69 | % | (0.48%) | | (0.18%) | 0.09 | % |
Boston Private Financial Holdings, Inc.
Selected Financial Data (1)
(In Thousands, except share data)
(Unaudited)
| | | | | | | | | |
| LOAN DATA AND CREDIT QUALITY (8): | Dec 31, | Dec 31, | Sept 30, |
| | 2010 | 2009 | 2010 |
| Commercial Loans: | | | |
| New England | $ | 1,125,669 | | $ | 943,740 | | $ | 1,082,877 | |
| Northern California | 859,073 | | 927,074 | | 935,994 | |
| Southern California | 234,926 | | 231,684 | | 233,383 | |
| Pacific Northwest | 136,745 | | 111,039 | | 134,337 | |
| Eliminations and other, net | (180 | ) | (517 | ) | (213 | ) |
| Total Commercial Loans | $ | 2,356,233 | | $ | 2,213,020 | | $ | 2,386,378 | |
| | | | |
| Construction and Land Loans: | | | |
| New England | $ | 80,021 | | $ | 117,817 | | $ | 97,585 | |
| Northern California | 55,284 | | 161,839 | | 97,791 | |
| Southern California | 1,840 | | 7,719 | | 1,869 | |
| Pacific Northwest | 13,557 | | 28,286 | | 13,670 | |
| Total Construction and Land Loans | $ | 150,702 | | $ | 315,661 | | $ | 210,915 | |
| | | | |
| Residential Mortgage Loans: | | | |
| New England | $ | 1,181,399 | | $ | 1,113,842 | | $ | 1,154,671 | |
| Northern California | 293,622 | | 219,394 | | 277,321 | |
| Southern California | 153,102 | | 124,212 | | 159,321 | |
| Pacific Northwest | 45,811 | | 37,255 | | 43,645 | |
| Total Residential Mortgage Loans | $ | 1,673,934 | | $ | 1,494,703 | | $ | 1,634,958 | |
| | | | |
| Home Equity and Other Consumer Loans: | | | |
| New England | $ | 199,454 | | $ | 179,792 | | $ | 201,569 | |
| Northern California | 73,172 | | 74,192 | | 72,152 | |
| Southern California | 17,654 | | 20,947 | | 15,529 | |
| Pacific Northwest | 7,098 | | 5,278 | | 6,567 | |
| Eliminations and other, net | 2,100 | | 3,447 | | 2,206 | |
| Total Home Equity and Other Consumer Loans | $ | 299,478 | | $ | 283,656 | | $ | 298,023 | |
| | | | |
| Total Loans | | | |
| New England | $ | 2,586,543 | | $ | 2,355,191 | | $ | 2,536,702 | |
| Northern California | 1,281,151 | | 1,382,499 | | 1,383,258 | |
| Southern California | 407,522 | | 384,562 | | 410,102 | |
| Pacific Northwest | 203,211 | | 181,858 | | 198,219 | |
| Eliminations and other, net | 1,920 | | 2,930 | | 1,993 | |
| Total Loans | $ | 4,480,347 | | $ | 4,307,040 | | $ | 4,530,274 | |
Bo ston Private Financial Holdings, Inc.
Selected Financial Data (1)
(In Thousands, except share data) (Unaudited) | | | | | | | | | |
| &nbs p; | Dec 31, | Dec 31, | Sept 30, |
| | 2010 | 2009 | 2010 |
| Allowance for Loan Losses: | | | |
| New England | $ | 32,938 | | $ | 27,363 | | $ | 30,948 | |
| Northern California | 46,117 | | 19,950 | | 49,824 | |
| Southern California | 12,375 | | 11,659 | | 12,346 | |
| Pacific Northwest | 6,973 | | 9,472 | | 6,892 | |
| Total Allowance for Loan Losses | $ | 98,403 | | $ | 68,444 | | $ | 100,010 | |
| Special Mention Loans: | | | |
| New England | $ | 70,114 | | $ | 41,421 | | $ | 54,375 | |
| Northern California | 74,991 | | 20,5 77 | | 66,493 | |
| Southern California | 22,691 | | 8,900 | | 7,872 | |
| Pacific Northwest | 19,819 | | 18,255 | | 21,325 | |
| Total Special Mention Loans | $ | 187,615 | | $ | 89,153 | | $ | 150,065 | |
| Accruing Classified Loans (9): | | | |
| New England | $ | 19,745 | | $ | 14,534 | | $ | 19,228 | |
| Northern California | 62,518 | | 14,768 | | 66,061 | & nbsp; |
| Southern California | 6,802 | | 8,117 | | 11,467 | |
| Pacific Northwest | 8,373 | | 15,118 | | 9,308 | |
| Total Accr uing Classified Loans | $ | 97,438 | | $ | 52,537 | | $ | 106,064 | |
| Non-performing Loans: | | | |
| New England | $ | 25,172 | | $ | 8,346 | | $ | 20,872 | |
| Northern California | 60,373 | | 37,584 | | 99,573 | |
| Southern California (10) | 10,663 | | 21,953 | | 12,585 | |
| Pacific Northwest | 10,783 | | 22,455 | | 10,060 | |
| Total Non-performing Loans | $ | 106,991 | | $ | 90,338 | | $ | 143,090 | |
| Other Real Estate Owned: | | | |
| New England | $ | — | | $ | 870 | | $ | 892 | |
| Northern California | 10,207 | | 9,025 | | 4,283 | |
| Southern California | 1,128 | | 4,382 | | 4,141 | |
| Pacific Northwest | 1,590 | | 2,323 | | 3,753 | |
| Total Other Real Estate Owned | $ | 12,925 | | $ | 16,600 | | $ | 13,069 | & nbsp; |
| Loans 30-89 Days Past Due: | | | |
| New England | $ | 12,844 | | $ | 6,658 | | $ | 5,515 | |
| Northern California | 11,219 | | 6,799 | | 8,270 | |
| Southern California | 682 | | 4,259 | | 2,860 | |
| Pacific Northwest | — | | 3,478 | | 226 | |
| Total Loans 30-89 Days Past Due | $ | 24,745 | | $ | 21,194 | | $ | 16,871 | |
| Loans Charged-off/(Recovered), Net for the Three Months Ended: | | | |
| New England | $ | 510 | | $ | 555 | | $ | 393 | |
| Northern California | 33,957 | | 6,937 | | 11,896 | |
| S outhern California | (118 | ) | 5,065 | | (1,224 | ) |
| Pacific Northwest | (191 | ) | 5,813 | | 48 | |
| Total Net Loans Charged-off | $ | 34,158 | | $ | 18,370 | | $ | 11,113 | |
| Loans Charged-off/(Recovered), Net for the Twelve Months Ended: | | | |
| New England | $ | 3,725 | | $ | 2,495 | | |
| Northern California | 54,858 | | 8,387 | | |
| Southern California | (1,753 | ) | 13,017 | | |
| Pacific Northwest | 389 | | 16,707 | | |
| Total Net Loans Charged-off | $ | 57,219 | | $ | 40,606 | | |
Boston Private Financial Holdings, Inc.
Selected Financial Data (1)
(In Thousands, except share data)
(Unaudited)
(1) In 2009, the Company completed the sale of its affiliates Boston Private Value Investors, Sand Hill Advisors, RINET, Gibraltar, and Westfield Capital Management. Accordingly, prior period and current financial information related to the divested companies are included with discontinued operations.
(3) Other Revenue, Gains and (Losses), net, as presented in these tables include Gain on Sale of Investments, net; and Other Miscellaneous Revenue.
(4) Other Operati ng Expenses, as presented in these tables, include expenses related to Marketing and Business Development, Contract Services and Processing, Impairment Expense and Amortization of Intangibles.
(5) Adjustments to Net Income Attributable to the Company to arrive at Net Income/(Loss) Attributable to the Common Shareholders, as presented in these tables, include decrease/ (increase) in Noncontrolling Interests Redemption Value; Dividends on Preferred Securities; Accretion of Discount on Series C Preferred Stock; and Accretion of Series B Preferred Stock Beneficial Conversion Feature.
(6) Interest Income on Non-taxable Investments and Loans are presented on an FTE basis using the federal statutory rate.
(7) Includes Loans Held for Sale and Non-accrual Loans.
(8) The concentration of the Private Banking loan data and credit quality is based on the location of the lender. Net loans from the Holding Company to certain principals of the Company's affiliate partners, loans at the Company's non-banking segments, and inter-company loan eliminations are identified as “Eliminations and other, net”.
(9) Accruing classified loans include loans that are classified as substandard but are still accruing interest income. The Banks may classify a loan as substandard where known information about possible credit problems of the related borrowers causes management to have doubts as to the ability of such borrowers to comply with the present repayment terms and which may result in disclosure of such loans as nonperforming at some time in the future.
(10) Includes the non-strategic loans held for sale of $1.5 million, $3.6 million, and $2.9 million, at Dec 31, 2010, Dec 31, 2009 and Sept 30, 2010, respectively.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunder duly authorized.
| | |
| | BOSTON PRIVATE FINANCIAL HOLDINGS, INC. |
| | | |
| | By: | /S/ DAVID J. KAYE |
| | Name: | David J. Kaye |
| | Title: | Chief Financial Officer |
| Date: January 27, 2011 | | &nb sp; |
