Bar Harbor Bankshares (NYSE
American: BHB) reported record GAAP earnings in 2017 of
$26.0 million, or $1.70 per share, compared with $14.9 million in
2016, or $1.63 per share. Core earnings in 2017 increased to $32.1
million, or $2.10 per share, from $13.9 million in 2016, or $1.52
per share. Earnings grew during 2017 due to business expansion,
investments in talent and increased operational efficiencies.
Fourth quarter GAAP earnings were $6.6 million, or 43 cents per
share. Core earnings totaled $9.0 million, or 58 cents per share.
GAAP earnings included a $4.0 million income tax charge due to the
revaluation of net deferred tax assets required by the Tax Cuts and
Jobs Act of 2017 (“TCJA”). In addition, there was a net benefit of
$2.6 million, which included the sale of the insurance subsidiary
offset by other one-time charges.
FOURTH QUARTER FINANCIAL HIGHLIGHTS (comparisons are to
prior quarter unless otherwise stated):
- 1.02% core return on assets (non-GAAP
measure)
- 21% annualized commercial loan
growth
- 13% annualized total deposit
growth
- 53% efficiency ratio (non-GAAP
measure)
- 9.97% core return on equity (non-GAAP
measure)
President and Chief Executive Officer, Curtis C. Simard stated,
“We delivered a strong finish to all of our key performance
indicators within mere quarters of doubling our asset size and
successfully completing a system conversion. Based on our momentum,
we are well ahead of the earn back period from the acquisition and
are poised to deliver another great year as we hold firm to our
model of balancing growth and earnings.”
Mr. Simard went on to say, “Management continues to evolve as we
attract seasoned, proven executives and senior managers to join our
team. Earlier this week we announced a new EVP, Director of Retail
Delivery, Marion Colombo, who will be joining the bank to lead our
retail franchise.” Mr. Simard commented, “Simply put, retail branch
activity is at the very heart of our business. Finding a long-term
proven leader like Marion, who comes with over twenty-nine years of
retail experience in many diverse markets, is a significant
indication of our commitment to being a true community bank with a
growing retail franchise.”
Excluding the impact of TCJA and other one-time adjustments, our
fourth quarter performance peaked for the year with a return on
assets of 1.02% and a return on equity of 9.97%. The tangible
equity to tangible asset ratio (a non-GAAP measure) decreased to
7.12% at the end of the fourth quarter primarily due to the impact
of the TCJA adjustment. We expect this reduction will be earned
back from related tax savings within the first half of 2018 with
opportunities for further expansion thereafter.
Mr. Simard further stated, “Our Commercial teams continue to
penetrate their markets as is evidenced by another strong quarter
of 21% loan growth led by commercial and industrial loans at 34%.
Asset quality metrics remain strong while charge-offs are at
historical lows. We also expanded our Treasury Management Services
platform during the fourth quarter, which was rolled out in January
2018. Given the talent we have hired to manage this business and
the enhanced capabilities, we expect this to be a significant
contributor in 2018 in terms of both fee revenue and deposit
gathering.”
Mr. Simard concluded, “As we enter 2018, we are positioned to
continue with the momentum seen during the second half of 2017
while executing on our strategy to provide our customers with the
best customer service. We remain committed to our communities and
will seek opportunities to expand our branch model as a true
community bank in 2018.”
RESULTS OF OPERATIONSGAAP earnings decreased to $6.6
million in the fourth quarter from $8.6 million in the third
quarter. The decrease was primarily due to the TCJA charge offset
by other one-time adjustments including the sale of our insurance
subsidiary. Core earnings (a non-GAAP measure) increased to $9.0
million in the fourth quarter compared to $8.8 million in the prior
quarter. Yields on loans decreased 1 basis point to 4.12% in the
fourth quarter due to lower purchased loan accretion as compared to
the third quarter. Excluding the impact of purchase loan accretion,
loan yield expanded 2 basis points to 3.92% in the fourth quarter
from 3.90% in the third quarter. The loan yield benefited from a
$29 million average balance increase in fixed rate commercial real
estate products. Security yields decreased in the fourth quarter as
a result of accelerated premium amortization. The cost of
interest-bearing deposits increased as a result of both interest
rate hikes and an extension in maturities as we manage our overall
interest rate risk. The Company’s overall cost of funds remained
relatively flat for the quarter as the 13% growth in deposits
offset more expensive alternative borrowing costs.
Total non-interest income was $6.5 million in the fourth quarter
compared to $7.0 million in the prior quarter. The decrease is
primarily due to seasonality effects on customer service fees and
the curtailment of revenue with the sale of our insurance
subsidiary in October 2017. As previously announced, the sale of
the insurance subsidiary was part of a strategic decision to
redeploy capital and management resources to core businesses. The
sale had no significant impact to core net income as the
contribution margin was neutral. Trust and management fee income
during the fourth quarter remained flat with the third quarter.
Overall, the unfavorable variability of transactional fees during
2017 was offset by the growth of assets under management to $445
million at the end of 2017 from $425 million at the end of 2016.
Non-interest expense excluding acquisition, conversion and other
one-time adjustments decreased $362 thousand in the fourth quarter
compared to the linked quarter. The efficiency ratio was 53% for
the quarter compared to 54% in the third quarter, which reflects
further disciplined cost control.
FINANCIAL CONDITIONTotal assets grew $89 million during
the fourth quarter to $3.6 billion driven by total loan growth of
$57 million, or 9% on an annualized basis. The majority of the loan
growth was led by the commercial portfolio, which had an annualized
growth rate of 21%. Total loan growth was funded by growth in
deposits, which increased $77 million, or 13% on an annualized
basis. Non-accruing loans increased by $7.5 million during the
quarter primarily due to the deterioration of one specific
commercial relationship, which is expected to be settled at the
full contractual obligation. Asset quality metrics remain strong
with charge-offs at historical lows and an allowance for credit
losses to total loans ratio of 0.50%. The Company's book value per
share increased to $22.96 from $22.90 in the third quarter while
tangible book value (a non-GAAP measure) increased to $15.94 from
$15.84.
BACKGROUNDBar Harbor Bankshares (NYSE American: 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.
FORWARD LOOKING STATEMENTSThis 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 MEASURESThis 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, acquisition 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 the
acquisition of Lake Sunapee Bank Group consist 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 acquisition.
TABLE
INDEX
CONSOLIDATED FINANCIAL SCHEDULES (UNAUDITED)
A
Selected Financial
Highlights
B
Footnotes to
Selected Financial Highlights
C
Balance
Sheets
D
Loan and Deposit
Analysis
E
Statements of
Income
F
Statements of Income
(Five Quarter Trend)
G
Average Yields and
Costs
H
Average
Balances
I
Asset Quality
Analysis
J
Reconciliation of
Non-GAAP Financial Measures (Five Quarter Trend) and Supplementary
Data
BAR HARBOR BANKSHARES SELECTED FINANCIAL
HIGHLIGHTS - UNAUDITED At or for the Quarters
Ended (1)(3) Dec 31,2017 Sep 30,2017
Jun 30,2017 Mar 31,2017 Dec
31,2016
PER SHARE DATA Net earnings, diluted $ 0.43 $ 0.56 $
0.42 $ 0.29 $ 0.28 Core earnings, diluted (1) (2) 0.58 0.57 0.52
0.43 0.41 Total book value 22.96 22.90 22.53 22.17 17.19 Tangible
book value (2) 15.94 15.84 15.44 15.07 16.61 Market price at period
end 27.01 31.36 30.82 33.08 31.55 Dividends 0.19 0.19 0.19 0.19
0.19
PERFORMANCE RATIOS Return on assets 0.75 % 0.99
% 0.76 % 0.50 % 0.59 % Core return on assets (1) (2) 1.02 1.01 0.94
0.74 0.87 Return on equity 7.35 9.67 7.55 5.34 6.36 Core return on
equity (1) (2) 9.97 9.90 9.32 7.88 9.34 Core return on tangible
equity (1) (2) 14.53 14.51 13.78 12.24 9.66 Net interest margin,
fully taxable equivalent (FTE) (4) 3.04 3.06 3.16 3.11 2.89 Net
interest margin (FTE), excluding purchased loan accretion (4) 2.93
2.93 3.02 3.01 2.89 Efficiency ratio (2) 53.09 53.59 54.64 61.62
59.24
GROWTH (Year-to-date, annualized) Total
commercial loans (2) 23.8 % 20.5 % 7.2 % 20.0 % 14.9 % Total loans
(2) 13.1 12.2 7.0 13.3 15.0 Total deposits (2) 14.4 10.6 2.3 (10.2
) 6.5
FINANCIAL DATA (In millions) Total assets $
3,565 $ 3,476 $ 3,503 $ 3,427 $ 1,755 Total earning assets 3,241
3,184 3,139 3,139 1,683 Total investments 755 756 763 767 554 Total
loans 2,486 2,429 2,377 2,372 1,129 Allowance for loan losses 12 12
11 11 10 Total goodwill and intangible assets 108 109 109 109 5
Total deposits 2,352 2,275 2,213 2,174 1,050 Total shareholders'
equity 355 353 347 341 157 Net income 7 9 7 4 3 Core income (2) 9 9
8 6 4
ASSET QUALITY AND CONDITION RATIOS Net
charge-offs (current quarter annualized)/average loans (5) 0.04 %
0.01 % 0.03 % 0.06 % (0.03 )% Allowance for loan losses/total loans
(5) 0.50 0.49 0.48 0.46 0.92 Loans/deposits 106 107 107 109 108
Shareholders' equity to total assets 9.95 10.17 9.91 9.95 8.93
Tangible shareholders' equity to tangible assets (2)
7.12 7.26 7.01
6.99 8.65
(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.
BAR HARBOR BANKSHARES CONSOLIDATED BALANCE SHEETS - UNAUDITED
(In thousands) Dec 31, 2017 Sep 30, 2017 Jun 30, 2017 Mar
31, 2017 Dec 31, 2016
Assets Cash and due from banks $
34,262 $ 31,223 $ 28,112 $ 29,245 $ 8,219 Interest-bearing deposit
with the Federal Reserve Bank 56,423 17,501 90,881
12,781 220 Total cash and cash equivalents
90,685 48,724 118,993 42,026 8,439 Securities available for sale,
at fair value 717,242 718,459 718,364 724,224 528,856 Federal Home
Loan Bank stock 38,105 37,107 44,168 42,404
25,331 Total securities 755,347 755,566 762,532
766,628 554,187 Commercial real estate 826,746 793,572 738,584
779,635 418,119 Commercial and industrial 379,423 357,072 350,002
309,995 151,240 Residential real estate 1,155,682 1,152,628
1,160,832 1,155,436 506,612 Consumer 123,762 125,590
127,229 127,370 53,093 Total loans 2,485,613
2,428,862 2,376,647 2,372,436 1,129,064 Less: Allowance for loan
losses (12,325 ) (11,950 ) (11,442 ) (10,884 ) (10,419 ) Net loans
2,473,288 2,416,912 2,365,205 2,361,552 1,118,645 Premises
and equipment, net 47,708 48,309 48,590 45,581 23,419 Other real
estate owned 122 122 122 363 90 Goodwill 100,085 100,255 100,255
99,901 4,935 Other intangible assets 8,383 8,811 9,047 9,282 377
Cash surrender value of bank-owned life insurance 57,997 57,613
57,233 56,627 24,450 Deferred tax asset, net 7,180 13,052 13,211
14,158 5,990 Other assets 24,389 26,368 28,223
31,365 14,817 Total assets $ 3,565,184 $
3,475,732 $ 3,503,411 $ 3,427,483 $ 1,755,349
Liabilities and shareholders' equity Demand
and other non-interest bearing deposits $ 349,055 $ 357,398 $
332,339 $ 349,896 $ 98,856 NOW deposits 466,610 442,085 451,171
242,876 175,150 Savings deposits 364,799 373,118 360,306 511,091
77,623 Money market deposits 305,275 300,398 285,312 349,491
282,234 Time deposits 866,346 802,110 783,876
720,899 416,437 Total deposits 2,352,085 2,275,109
2,213,004 2,174,253 1,050,300 Senior borrowings 786,688
775,582 872,021 842,150 531,596 Subordinated borrowings 43,033
43,048 43,063 43,078 5,000 Total
borrowings 829,721 818,630 915,084 885,228 536,596 Other
liabilities 28,737 28,534 28,201 26,954
11,713 Total liabilities 3,210,543 3,122,273 3,156,289
3,086,435 1,598,609 Total common shareholders' equity
354,641 353,459 347,122 341,048 156,740
Total liabilities and shareholders' equity $ 3,565,184
$ 3,475,732 $ 3,503,411 $ 3,427,483 $
1,755,349
Net shares outstanding (2)
15,443 15,432
15,407 15,385 9,116
(1) The Company completed the acquisition of Lake Sunapee Bank
Group on January 13, 2017.(2) Adjusted for 3-for-2 stock-split
completed in March 2017.
BAR HARBOR BANKSHARES CONSOLIDATED LOAN & DEPOSIT
ANALYSIS - UNAUDITED
LOAN
ANALYSIS
Organic Annualized Growth % (1)
December 31, 2017 (in thousands) Dec 31, 2017 Sep 30, 2017 Jun 30,
2017 Mar 31, 2017 Acquired Lake Sunapee Bank (2) Dec 31, 2016
Quarter End Year to Date Commercial real estate $
826,746 $ 793,572 $ 738,584 $ 779,635 $ 345,586 $ 418,119 16.7 %
15.1 % Commercial and industrial 293,707 270,759
269,960 236,526 89,259 135,564 33.9
50.8 Total commercial loans 1,120,453 1,064,331
1,008,544 1,016,161 434,845 553,683 21.1 23.8 Residential real
estate 1,155,682 1,152,628 1,160,832 1,155,436 652,255 506,612 1.1
(0.6 ) Consumer 123,762 125,590 127,229 127,370 76,489 53,093 (5.8
) (11.0 ) Tax exempt and other 85,716 86,313 80,042
73,469 44,611 15,676 (2.8 ) 162.2
Total loans $ 2,485,613 $
2,428,862 $ 2,376,647 $
2,372,436 $ 1,208,200 $
1,129,064 9.3 % 13.1 %
(1) Non-GAAP financial measure.(2) Acquired Lake Sunapee Bank
loans are as of January 13, 2017.
DEPOSIT
ANALYSIS
Organic Annualized Growth % (1)
December 31, 2017 (in thousands) Dec 31, 2017 Sep 30, 2017 Jun 30,
2017 Mar 31, 2017 Acquired Lake Sunapee Bank (2) Dec 31, 2016
Quarter End Year to Date Demand $ 349,055 $ 357,398 $
332,339 $ 349,896 $ 248,051 $ 98,856 (9.3 )% 2.2 % NOW 466,610
442,085 451,171 242,876 39,999 175,150 22.2 143.6 Money market
305,275 300,398 285,312 349,491 103,142 282,234 6.5 (28.4 ) Savings
364,799 373,118 360,306 511,091 467,735
77,623 (8.9 ) (232.6 ) Total non-maturity deposits
1,485,739 1,472,999 1,429,128 1,453,354 858,927 633,863 3.5 (1.1 )
Total time deposits 866,346 802,110 783,876
720,899 291,684 416,437 32.0 38.0
Total deposits $ 2,352,085
$ 2,275,109 $ 2,213,004
$ 2,174,253 $ 1,150,611
$ 1,050,300 13.5 % 14.4 %
(1) Non-GAAP financial measure.(2) Acquired Lake Sunapee Bank
deposits are as of January 13, 2017.
BAR HARBOR BANKSHARES CONSOLIDATED STATEMENTS OF INCOME -
UNAUDITED
Three Months Ended December 31, Twelve Months Ended December
31, (In thousands, except per share data) 2017 2016 2017 2016
Interest and dividend income Loans $ 24,895 $ 11,026 $
94,976 $ 41,653 Securities and other 5,261 3,820
21,093 15,834 Total interest and dividend income 30,156
14,846 116,069 57,487
Interest expense Deposits 3,381 1,768
11,307 6,699 Borrowings 3,279 1,421 12,607
5,414 Total interest expense 6,660 3,189 23,914
12,113
Net interest income 23,496 11,657
92,155 45,374 Provision for loan losses 597 225 2,788
979 Net interest income after provision for loan losses 22,899
11,432 89,367 44,395
Non-interest
income Trust and investment management fee income 3,042 951
12,270 3,829 Insurance and brokerage service income 77 — 1,097 —
Customer service fees 2,495 649 8,484 2,648 Gain on sales of
securities, net — 9 19 4,498 Bank-owned life insurance income 374
163 1,539 703 Other income 530 263 2,573 671
Total non-interest income 6,518 2,035 25,982
12,349
Non-interest expense Salaries and employee benefits
9,524 5,127 39,589 19,775 Occupancy and equipment 3,060 1,144
11,633 4,610 Loss on sales of premises and equipment, net — 32 94
248 Outside services 780 337 3,000 767 Professional services 298
405 1,655 1,489 Communication 249 94 1,289 586 Amortization of
intangible assets 186 1 720 26 Acquisition, conversion and other
expenses (2,615 ) 1,838 3,302 2,650 Other expenses 2,781
1,479 11,444 5,784 Total non-interest expense 14,263
10,457 72,726 35,935 Income before
income taxes 15,154 3,010 42,623 20,809 Income tax expense 8,545
426 16,630 5,876
Net income
$ 6,609 $ 2,584 $
25,993 $ 14,933
Earnings per
share: Basic (1) $ 0.43 $ 0.28 $ 1.71 $ 1.65 Diluted (1) 0.43
0.28 1.70 1.63
Weighted average shares outstanding:
Basic (1) 15,437 9,096 15,184 9,069 Diluted (1)
15,537 9,215 15,290
9,143
(1) Adjusted for 3-for-2 stock-split completed in March
2017.
BAR HARBOR BANKSHARES CONSOLIDATED STATEMENTS OF INCOME
(5 Quarter Trend) - UNAUDITED
(In thousands, except per
share data) Dec 31,2017 Sep 30,2017 Jun 30,2017 Mar 31,2017 Dec
31,2016
Interest and dividend income Loans $ 24,895 $ 24,661
$ 24,226 $ 21,194 $ 11,026 Securities and other 5,261 5,402
5,439 4,991 3,820 Total interest and dividend
income 30,156 30,063 29,665 26,185 14,846
Interest expense
Deposits 3,381 3,177 2,539 2,210 1,768 Borrowings 3,279
3,408 3,317 2,603 1,421 Total interest expense
6,660 6,585 5,856 4,813 3,189
Net
interest income 23,496 23,478 23,809 21,372 11,657 Provision
for loan losses 597 660 736 795 225 Net
interest income after provision for loan losses 22,899
22,818 23,073 20,577 11,432
Non-interest
income Trust and investment management fee income 3,042 3,040
3,324 2,864 951 Insurance and brokerage service income 77 329 327
364 — Customer service fees 2,495 2,638 1,991 1,360 649 Gain on
sales of securities, net — 19 — — 9 Bank-owned life insurance
income 374 380 386 399 163 Other income 530 554 530
959 263 Total non-interest income 6,518 6,960
6,558 5,946 2,035
Non-interest expense
Salaries and employee benefits 9,524 9,617 10,127 10,321 5,127
Occupancy and equipment 3,060 2,894 3,013 2,666 1,144 Loss on sales
of premises and equipment,net — (1 ) — 95 32 Outside services 780
907 716 597 337 Professional services 298 428 489 440 405
Communication 249 382 290 368 94 Amortization of intangible assets
186 189 188 157 1 Acquisition, conversion and other expenses (2,615
) 346 2,459 3,112 1,838 Other expenses 2,781 2,824
2,764 3,075 1,479 Total non-interest expense 14,263
17,586 20,046 20,831 10,457
Income before income taxes 15,154 12,192 9,585 5,692 3,010 Income
tax expense 8,545 3,575 3,029 1,481 426
Net income $ 6,609 $
8,617 $ 6,556 $ 4,211
$ 2,584
Earnings per share:
Basic (1) $ 0.43 $ 0.56 $ 0.43 $ 0.29 $ 0.28 Diluted (1) 0.43 0.56
0.42 0.29 0.28
Weighted average shares outstanding:
Basic (1) 15,437 15,420 15,393 14,471 9,096 Diluted (1)
15,537 15,511
15,506 14,591 9,215
(1) Adjusted for 3-for-2 stock split completed in March
2017.
BAR HARBOR BANKSHARES AVERAGE YIELDS AND COSTS (Fully
Taxable Equivalent - Annualized) - UNAUDITED
Quarters
Ended Dec 31,2017 Sep 30,2017 Jun 30,2017 Mar 31,2017 Dec
31,2016
Earning assets Loans 4.12 % 4.13 % 4.14 % 4.00 %
3.94 % Securities and other 3.06 3.13 3.19
3.01 3.01 Total earning assets 3.87 % 3.89 % 3.91 %
3.76 % 3.65 %
Funding liabilities Interest bearing
deposits 0.70 % 0.66 % 0.56 % 0.52 % 0.76 % Borrowings 1.62
1.66 1.41 1.25 1.05 Total
interest-bearing liabilities 0.97 % 0.96 % 0.85 % 0.76 % 0.86 %
Net interest
spread 2.90 2.93 3.06 3.00 2.79 Net interest margin
3.04 3.06 3.16
3.11 2.89
BAR
HARBOR BANKSHARES AVERAGE BALANCES - UNAUDITED
Quarters Ended (In thousands) Dec 31,2017 Sep 30,2017 Jun 30,2017
Mar 31,2017 Dec 31,2016
Assets Total loans (1) $ 2,433,585 $
2,402,171 $ 2,377,141 $ 2,346,340 $ 1,119,065 Securities and other
(2) 753,282 754,450 761,546 746,653
556,365 Total earning assets 3,186,867 3,156,621 3,138,687
3,092,993 1,675,430 Cash and due from banks 65,145 49,169 87,332
25,556 5,976 Allowance for loan losses (12,202 ) (11,786 ) (11,292
) (10,584 ) (10,336 ) Goodwill and other intangible assets 108,769
109,147 109,108 109,261 5,324 Other assets 144,359 149,394
110,129 122,396 71,807 Total assets $
3,492,938 $ 3,452,545 $ 3,433,964 $ 3,339,622
$ 1,748,201
Liabilities and shareholders'
equity Total interest-bearing deposits $ 1,925,802 $ 1,901,501
$ 1,811,226 $ 1,798,014 $ 930,983 Borrowings 803,469 812,938
941,789 856,328 537,818 Total
interest-bearing liabilities 2,729,271 2,714,439 2,753,015
2,654,342 1,468,801 Non-interest-bearing demand deposits 376,066
354,470 320,503 350,497 108,961 Other liabilities 30,971
30,079 13,145 19,334 7,929 Total
liabilities 3,136,308 3,098,988 3,086,663 3,024,173 1,585,691
Total shareholders' equity 356,630 353,557 347,301 315,449
162,510 Total liabilities
and shareholders' equity $ 3,492,938
$ 3,452,545 $ 3,433,964
$ 3,339,622 $ 1,748,201
(1) Total loans include non-accruing loans.(2) Average balances
for securities available-for-sale are based on amortized cost.
BAR HARBOR BANKSHARES ASSET QUALITY ANALYSIS -
UNAUDITED
At or for the Quarters Ended (in thousands)
Dec 31,2017 Sep 30,2017 Jun 30,2017 Mar 31,2017 Dec 31,2016
NON-PERFORMING ASSETS Non-accruing loans: Commercial real
estate $ 8,343 $ 2,467 $ 2,090 $ 2,354 $ 2,564 Commercial
installment 1,209 236 270 451 315 Residential real estate 4,266
3,619 2,783 3,066 3,419 Consumer installment 500 496
160 160 198 Total non-accruing loans 14,318
6,818 5,303 6,031 6,496 Other real estate owned 122 122
122 363 90 Total non-performing assets
$ 14,440 $ 6,940 $ 5,425 $ 6,394 $
6,586 Total non-accruing loans/total loans 0.58 %
0.28 % 0.22 % 0.25 % 0.58 % Total non-performing assets/total
assets 0.41 0.20 0.15 0.19 0.38
PROVISION AND ALLOWANCE
FOR LOAN LOSSES Balance at beginning of period $ 11,950 $
11,442 $ 10,884 $ 10,419 $ 10,103 Charged-off loans (277 ) (297 )
(213 ) (344 ) (28 ) Recoveries on charged-off loans 55 145
35 14 119 Net loans charged-off (222 )
(152 ) (178 ) (330 ) 91 Provision for loan losses 597 660
736 795 225 Balance at end of period $
12,325 $ 11,950 $ 11,442 $ 10,884 $
10,419 Allowance for loan losses/total loans 0.50 %
0.49 % 0.48 % 0.46 % 0.92 % Allowance for loan losses/non-accruing
loans 86 175 216 180 160
NET LOAN CHARGE-OFFS
Commercial real estate $ (92 ) $ (16 ) $ (6 ) $ (103 ) $ 5
Commercial installment 1 6 (138 ) (17 ) 89 Residential real estate
— (79 ) (13 ) (198 ) 8 Consumer installment (131 ) (63 ) (21 ) (12
) (11 ) Total, net $ (222 ) $ (152 ) $ (178 ) $ (330 ) $ 91
Net charge-offs (QTD annualized)/average loans 0.04 % 0.01 %
0.03 % 0.06 % (0.03 )% Net charge-offs (YTD annualized)/average
loans 0.04 0.04 0.04 0.06 (0.03 )
DELINQUENT AND
NON-ACCRUING LOANS/TOTAL LOANS 30-89 Days delinquent 0.37 %
0.35 % 0.55 % 0.33 % 0.54 % 90+ Days delinquent and still accruing
0.02 0.01 — — — Total accruing
delinquent loans 0.39 0.36 0.55 0.33 0.54 Non-accruing loans 0.58
0.28 0.22 0.25 0.58 Total
delinquent and non-accruing loans 0.97 %
0.64 % 0.77 % 0.58 %
1.12 %
BAR HARBOR BANKSHARES RECONCILIATION
OF NON-GAAP FINANCIAL MEASURES AND SUPPLEMENTARY DATA -
UNAUDITED At or for the Quarters Ended (in
thousands) Dec 31,2017 Sep 30,2017
Jun 30,2017 Mar 31,2017 Dec
31,2016 Net income $ 6,609 $ 8,617 $ 6,556 $ 4,211 $ 2,584 Adj:
Security Gains — (19 ) — — (9 ) Adj: Loss on sale of fixed assets,
net — (1 ) — 95 32 Adj: Acquisition, conversion and other expenses
(2,615 ) 346 2,459 3,112 1,838 Adj: Income taxes (37.57% in 2017,
35.0% in 2016) 982 (122 ) (924 ) (1,205 ) (651 ) Adj: Tax reform
charge 3,988 — — — —
Total core income (4) (A) $ 8,964 $ 8,821 $ 8,091
$ 6,213 $ 3,794 Net-interest income (B)
$ 23,496 $ 23,478 $ 23,809 $ 21,372 $ 11,657 Plus: Non-interest
income 6,518 6,960 6,558 5,946
2,035 Total Revenue 30,014 30,438 30,367 27,318 13,692 Adj:
Net security gains — (19 ) — — (9 )
Total core revenue (4) (C) $ 30,014 $ 30,419 $ 30,367
$ 27,318 $ 13,683 Total non-interest
expense $ 14,263 $ 17,586 $ 20,046 $ 20,831 $ 10,457 Less:
Acquisition expenses 2,615 (346 ) (2,459 ) (3,112 )
(1,838 ) Core non-interest expense (4) (D) $ 16,878 $ 17,240
$ 17,587 $ 17,719 $ 8,619 (in
millions) Total average earning assets (E) $ 3,187 $ 3,157 $ 3,139
$ 3,093 $ 1,675 Total average assets (F) 3,493 3,453 3,434 3,340
1,748 Total average shareholders' equity (G) 357 354 347 315 163
Total average tangible shareholders' equity (H) 248 244 238 206 157
Total tangible shareholders' equity, period-end (1) (I) 246 244 238
232 152 Total tangible assets, period-end (1) (J) 3,457 3,367 3,394
3,318 1,750 (in thousands) Total common shares outstanding,
period-end (K) 15,443 15,432 15,407 15,385 9,116 Average diluted
shares outstanding (L) 15,537 15,511 15,506 14,591 9,215
Core earnings per share, diluted (A/L) $ 0.58 $ 0.57 $ 0.52 $ 0.43
$ 0.41 Tangible book value per share, period-end (I/K) 15.94 15.84
15.44 15.07 16.61 Total tangible shareholders' equity/total
tangible assets (H/J) 7.12 7.26 7.01 6.99 8.65 Performance
ratios (2) GAAP return on assets 0.75 % 0.99 % 0.76 % 0.50 % 0.59 %
Core return on assets (4) (A/F) 1.02 1.01 0.94 0.74 0.87 GAAP
return on equity 7.35 9.67 7.55 5.34 6.36 Core return on equity (4)
(A/G) 9.97 9.90 9.32 7.88 9.34 Core return on tangible equity (3)
(4) (A/I) 14.53 14.51 13.78 12.24 9.66 Efficiency ratio (4)(5)
(D-N-P)/(C+M) 53.09 53.59 54.64 61.62 59.24 Net interest margin
(B+O)/E 3.04 3.06 3.16 3.11 2.89
Supplementary data (in
thousands) Taxable equivalent adjustment for efficiency ratio (M)
1,122 1,107 1,185 977 538 Franchise taxes included in non-interest
expense (N) 161 154 158 126 37 Tax equivalent adjustment for net
interest margin (O) 897 878 936 754 182 Intangible amortization (P)
186 189 188
157 157
(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.
View source
version on businesswire.com: http://www.businesswire.com/news/home/20180125006351/en/
Bar Harbor BanksharesJosephine Iannelli, 207-288-3314EVP, Chief
Financial Officer & TreasurerorMarsha Sawyer, 207-288-3314EVP,
Investor Relations
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