Fourth Quarter and Full Year Highlights:
- Net Interest Income Growth: Net
Interest Income for the fourth quarter increased 7% year-over-year
and 3% linked quarter to $51.5 million. Net Interest Income for the
full year of 2016 was $200.4 million, an 8% increase compared to
2015.
- Deposit and Loan Growth: Average
Total Deposits increased 2% year-over-year to $6.0 billion, and
Average Total Loans increased 6% year-over-year to $6.0
billion.
- Assets Under Management: Total
Assets Under Management/Advisory (“AUM”) of $27.6 billion were flat
year-over-year and linked quarter.
- Dividend Increase: The Board of
Directors approved a quarterly cash dividend of $0.11 per share of
common stock, an increase from $0.10 per share in the prior
quarter.
- Notable Items: During the fourth
quarter, the Company recorded a net after-tax charge of $4.3
million or $0.05 of diluted earnings per share related to goodwill
impairment charges and gain on sale of offices.
Boston Private Financial Holdings, Inc. (NASDAQ: BPFH) (the
“Company” or “BPFH”) today reported fourth quarter 2016 GAAP Net
Income Attributable to the Company of $17.6 million, compared to
$19.6 million for the third quarter of 2016 and $15.0 million for
the fourth quarter of 2015. Fourth quarter 2016 diluted earnings
per share were $0.19, compared to $0.22 in the third quarter of
2016, and $0.17 in the fourth quarter of 2015. Excluding Notable
Items and the related tax impact, adjusted Net Income Attributable
to the Company for the fourth quarter of 2016 was $21.9 million,
and adjusted diluted earnings per share were $0.24.
For the full year of 2016, BPFH reported GAAP Net Income
Attributable to the Company of $71.6 million or $0.81 of diluted
earnings per share, compared to $64.9 million or $0.74 of diluted
earnings per share for the full year of 2015.
“2016 was a year of progress for the Company,” said Clayton G.
Deutsch, CEO. "The overall Company delivered 10% annual profit
growth despite the impact of a goodwill impairment charge, and
returned record levels of capital to shareholders through dividends
and share repurchases.
“Our Private Bank contributed pristine asset quality and
reliable earnings growth throughout a challenging yield
environment, while Wealth Management & Trust demonstrated
ongoing progress towards stability. Our Investment Managers and
Wealth Advisors continue to contribute high returns to Company-wide
financial performance. As we enter 2017, we are focused on
perfecting our client service offering, improving profitability in
all of our businesses, and positioning for long term growth.”
Notable Items Impacting Fourth Quarter Results
During the fourth quarter, the Company recorded two Notable
Items that resulted in a net after-tax charge of $4.3 million. The
Notable Items include a pre-tax, non-cash charge of $9.5 million
for goodwill impairment related to the Wealth Management &
Trust segment, and a pre-tax net gain on sale of $2.9 million
related to the divestiture of two Southern California offices. The
office divestiture, which closed during the fourth quarter,
included $104 million of deposits. The tax effect was calculated by
applying the federal statutory rate of 35%.
Core Fees and Income/Assets Under Management
Core Fees and Income for the fourth quarter were $38.5 million,
a 2% increase linked quarter and a 4% increase year-over-year. For
the full year 2016, Core Fees and Income decreased 3% to $151.7
million due to lower AUM in the Wealth Management & Trust
segment, partially offset by higher Other Banking Fee Income.
AUM was $27.6 billion at the end of the fourth quarter, flat
from the previous quarter and year-over-year. The Company
experienced net flows of negative $176 million during the fourth
quarter, compared to negative $336 million and negative $543
million in the third quarter of 2016 and fourth quarter of 2015,
respectively. During the fourth quarter, net flows by segment were
negative $82 million for Wealth Management & Trust, negative
$23 million for Investment Management, and negative $71 million for
Wealth Advisory.
Net Interest Income
Net Interest Income for the fourth quarter was $51.5 million, an
increase of 3% from $49.9 million for the third quarter of 2016 and
an increase of 7% from $48.1 million for the fourth quarter of
2015. The current quarter includes $0.4 million of interest
recovered on previous nonaccrual loans compared to $0.3 million for
both the third quarter of 2016 and fourth quarter of 2015.
Excluding interest recovered on previous nonaccrual loans, Net
Interest Income on an FTE basis increased 4% linked quarter and 6%
year-over-year.
Net Interest Margin was 2.88% for the fourth quarter of 2016,
unchanged from both the third quarter of 2016 and the fourth
quarter of 2015. Excluding interest recovered on previous
nonaccrual loans, Net Interest Margin was 2.86%, also unchanged
from the third quarter of 2016 and the fourth quarter of 2015.
Total Operating Expenses
Total Operating Expenses for the fourth quarter of 2016 were
$71.8 million, up 16% from $61.7 million for the third quarter of
2016, primarily due to the goodwill impairment. Excluding the
goodwill impairment, Total Operating Expenses for the fourth
quarter were $62.3 million, a 1% increase from the previous
quarter.
On a year-over-year basis, Total Operating Expenses increased 7%
from $67.4 million. Excluding the fourth quarter 2016 goodwill
impairment and a fourth quarter 2015 restructuring charge of $2.0
million, Total Operating Expenses declined 5% year-over-year.
Provision and Asset Quality
The Company recorded a provision credit of $1.1 million for the
fourth quarter of 2016, compared to a provision credit of $0.1
million for the third quarter of 2016 and $1.7 million for the
fourth quarter of 2015. The provision credit in the fourth quarter
of 2016 was due to net recoveries and a decrease in Criticized and
Classified loans, partially offset by an increase in loan
volume.
Criticized Loans decreased 25% linked quarter and 23%
year-over-year to $118.5 million. Nonaccrual Loans (“Nonaccruals”)
increased 5% to $17.3 million on a linked quarter basis. On a
year-over-year basis, Nonaccruals decreased 35% from $26.6 million.
As a percentage of Total Loans, Nonaccruals were 28 basis points at
December 31, 2016, flat compared to September 30, 2016, and down 18
basis points from December 31, 2015.
Additional credit metrics are listed below:
(
In millions)
December 31, 2016
September 30, 2016
June 30, 2016 March 31,
2016 December 31, 2015
Total Criticized Loans $ 118.5 $ 158.8 $ 150.7 $ 166.9
$ 154.1 Total Loans 30-89 Days Past Due and Accruing
(13) $ 15.1 $ 4.6 $ 7.6 $ 8.3 $ 13.1 Total Net Loans (Charged-off)/
Recovered $ 1.5 $ 2.1 $ 1.9 $ 1.1 $ 0.9 Allowance for Loan Losses/
Total Loans
1.28 % 1.32 % 1.32 % 1.35 % 1.37 %
Capital Ratios
Capital ratios are listed below:
December 31, 2016
September 30, 2016 June 30,
2016 March 31, 2016
December 31, 2015 BPFH Ratios:
Total Risk-Based Capital * 13.9 % 14.0 % 14.0 % 14.0 % 13.9
% Tier I Risk-Based Capital * 12.7 % 12.7 % 12.7 % 12.7 % 12.6 %
Tier I Leverage Capital * 9.4 % 9.5 % 9.6 % 9.5 % 9.5 % TCE/TA (4)
7.1 % 7.4 % 7.4 % 7.3 % 7.0 % Tier I Common Equity/
Risk Weighted Assets *
10.0 % 10.0 % 10.0 % 9.9 % 9.8 %
*December 31, 2016 information is presented based on estimated
data.
Dividend PaymentsConcurrent with
the release of fourth quarter 2016 earnings, the Board of Directors
of the Company declared a cash dividend to common shareholders of
$0.11 per share. The record date for this dividend is February 3,
2017, and the payment date is February 17, 2017.
The Board of Directors of the Company also declared a cash
dividend to holders of the Non-Cumulative Perpetual Preferred
Stock, Series D of $17.375 per share, which will result in a
dividend of $0.434375 per depositary share. The record date for
this dividend is February 15, 2017, and the payment date is March
15, 2017.
Non-GAAP Financial MeasuresThe
Company uses certain non-GAAP financial measures, such as tangible
book value per share; the TCE/TA ratio; return on average common
equity; return on average tangible common equity; pre-tax,
pre-provision earnings; total operating expense excluding
intangibles, goodwill impairment, and restructuring; the efficiency
ratio (FTE basis); the efficiency ratio (FTE basis) excluding
amortization of intangibles, goodwill impairment, and
restructuring; net income attributable to the Company excluding
notable items; diluted earnings per share excluding notable items;
and Net Interest Income and Net Interest Margin excluding interest
recovered on previous nonaccrual loans; to provide information for
investors to effectively analyze financial trends of ongoing
business activities, and to enhance comparability with peers across
the financial sector. A detailed reconciliation table of the
Company's GAAP to the non-GAAP measures is attached.
Conference CallManagement will hold
a conference call at 8 a.m. Eastern Time on Thursday, January 19,
2017, to discuss the financial results, business highlights and
outlook. To access the call:
Dial In #: (888) 317-6003Elite Entry Number: 6886722
Replay Information:Available from January 19, 2017 at 12 noon
until January 26, 2017Dial In #: (877) 344-7529Conference Number:
10098672
The call will be simultaneously webcast and may be accessed on
www.bostonprivate.com.
Boston Private Financial Holdings,
Inc.Boston Private Financial Holdings, Inc. is a national
financial services organization that owns Wealth Management and
Private Banking affiliates with offices in Boston, New York, Los
Angeles, San Francisco, San Jose, Florida, and Wisconsin. The
Company has total assets of approximately $8 billion, and manages
over $27 billion of client assets.
The Company positions its affiliates to serve the high net worth
marketplace with high quality products and services of unique
appeal to private clients. The Company also provides strategic
oversight and access to resources, both financial and intellectual,
to support affiliate management, marketing, compliance and legal
activities. (NASDAQ: BPFH)
For more information about BPFH, visit the Company's website
at www.bostonprivate.com.
Forward-Looking StatementsCertain
statements in this press release that are not historical facts may
constitute 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 current 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, 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 weakness in general economic
conditions on a national basis or in the local markets in which the
Company operates; changes in loan defaults and charge-off rates;
changes in the value of securities and other assets, adequacy of
loan loss reserves, or decreases in deposit levels necessitating
increased borrowing to fund loans and investments; changes in
government regulation; the risk that goodwill and intangibles
recorded in the Company's financial statements will become
impaired; the risk that the Company's deferred tax asset may not be
realized; risks related to the identification and implementation of
acquisitions, dispositions and restructurings; 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. Forward-looking statements speak only as of
the date on which they are made. 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 statement is made.
Note to Editors:Boston Private
Financial Holdings, Inc. is not to be confused with Boston Private
Bank & Trust Company. Boston Private Bank & Trust Company
is a wholly-owned subsidiary of BPFH. The information reported in
this press release is related to the performance and results of
BPFH.
Boston Private Financial Holdings, Inc.
Selected Financial Data
(Unaudited) (In thousands, except share and per share
data)
12/31/2016 9/30/2016 6/30/2016
3/31/2016 12/31/2015 Assets: Cash and cash
equivalents
$ 106,557 $ 67,631 $ 126,167 $ 113,946 $
238,694 Investment securities available-for-sale
1,264,132
1,249,578 1,191,523 1,151,529 1,084,510 Investment securities
held-to-maturity
93,079 98,881 105,297 111,337 116,352 Stock
in Federal Home Loan Banks
44,077 36,084 44,374 34,202
35,181 Loans held for sale
3,464 5,316 4,677 5,383 8,072
Total loans
6,114,354 5,869,498 5,751,497 5,658,181
5,719,212 Less: Allowance for loan losses
78,077
77,669 75,753 76,427 78,500
Net loans
6,036,277 5,791,829 5,675,744 5,581,754
5,640,712 Other real estate owned (“OREO”)
1,690 1,800 2,042
98 776 Premises and equipment, net
31,827 32,089 31,752
31,575 31,036 Goodwill
142,554 152,082 152,082 152,082
152,082 Intangible assets, net
26,725 28,267 29,836 31,422
33,007 Fees receivable
13,400 11,185 11,129 11,041 11,258
Accrued interest receivable
20,479 18,062 18,061 17,590
17,950 Deferred income taxes, net
55,460 39,319 36,942
43,164 51,699 Other assets
130,753
149,427 149,975 128,540 121,179 Total
assets
$ 7,970,474 $ 7,681,550 $ 7,579,601 $
7,413,663 $ 7,542,508
Liabilities:
Deposits
$ 6,085,146 $ 5,812,243 $ 5,536,092 $
5,786,860 $ 6,040,437 Deposits held for sale
— 105,788
110,558 — — Securities sold under agreements to repurchase
59,624 77,466 43,304 63,182 58,215 Federal funds purchased
80,000 125,000 180,000 40,000 — Federal Home Loan Bank
borrowings
734,205 522,681 678,012 523,953 461,324 Junior
subordinated debentures
106,363 106,363 106,363 106,363
106,363 Other liabilities
119,683
134,322 135,289 114,222 111,468 Total
liabilities
7,185,021 6,883,863
6,789,618 6,634,580 6,777,807
Redeemable
Noncontrolling Interests 16,972 16,199 15,843 16,938
18,088
Shareholders’ Equity: Preferred stock, $1.00 par
value; authorized: 2,000,000 shares
47,753 47,753 47,753
47,753 47,753 Common stock, $1.00 par value; authorized:
170,000,000 shares
83,732 83,195 83,380 83,024 83,411
Additional paid-in capital
597,454 597,209 597,989 599,825
600,670 Retained earnings
47,929 39,415 28,985 21,740 12,886
Accumulated other comprehensive income/ (loss)
(12,548 ) 10,134 12,654 6,687
(1,500 ) Total Company’s shareholders’ equity
764,320 777,706 770,761 759,029
743,220 Noncontrolling interests
4,161
3,782 3,379 3,116 3,393
Total shareholders’ equity
768,481
781,488 774,140 762,145 746,613 Total
liabilities, redeemable noncontrolling interests and shareholders’
equity
$ 7,970,474 $ 7,681,550 $ 7,579,601 $
7,413,663 $ 7,542,508
Boston Private Financial Holdings, Inc.
Selected Financial Data (Unaudited) Three Months
Ended (In thousands, except share and per share data)
12/31/2016 9/30/2016 6/30/2016
3/31/2016 12/31/2015 Interest and dividend
income: Loans
$ 51,499 $ 50,074 $ 49,731 $ 50,046
$ 49,463 Taxable investment securities
1,592 1,537 1,507
1,594 1,239 Non-taxable investment securities
1,520 1,444
1,400 1,390 1,348 Mortgage-backed securities
3,290 3,079
2,982 3,065 2,863 Federal funds sold and other
508
469 405 507
449 Total interest and dividend income
58,409
56,603 56,025 56,602
55,362
Interest expense: Deposits
4,152 4,163 4,075 4,182 4,281 Federal Home Loan Bank
borrowings
1,987 1,929 2,139 1,953 1,960 Junior subordinated
debentures
674 591 584 578 973 Repurchase agreements and
other short-term borrowings
77 49
58 10 8 Total
interest expense
6,890 6,732
6,856 6,723 7,222 Net
interest income
51,519 49,871 49,169 49,879 48,140
Provision/ (credit) for loan losses
(1,128 )
(138 ) (2,535 ) (3,133 ) (1,655 ) Net
interest income after provision/ (credit) for loan losses
52,647 50,009 51,704
53,012 49,795
Fees and other
income: Investment management fees
12,408 10,717 10,627
10,658 10,889 Wealth advisory fees
12,568 12,750 12,551
12,712 12,569 Wealth management and trust fees
11,031 10,826
11,208 10,916 11,782 Other banking fee income
2,387 3,447
2,982 3,233 1,719 Gain on sale of loans, net
105
156 197 209
178 Total core fees and income
38,499
37,896 37,565 37,728
37,137 Gain/ (loss) on sale of investments, net
2 273 245 1 215 Gain/ (loss) on OREO, net
(110
) 137 — 280 — Gain on sale of offices
2,862 — — — —
Other
2,705 1,706 (1,015
) 13 366 Total other income
5,459 2,116 (770 ) 294
581
Operating expense: Salaries and
employee benefits
39,669 40,924 40,614 42,560 39,520
Occupancy and equipment
10,039 9,521 9,928 9,587 9,989
Professional services
2,756 2,290 3,015 3,515 3,778
Marketing and business development
2,022 1,623 1,811 2,170
4,001 Contract services and data processing
1,743 1,865
1,737 1,679 1,505 Amortization of intangibles
1,542 1,568
1,586 1,586 1,799 Impairment of goodwill
9,528 — — — — FDIC
insurance
727 722 1,015 1,020 1,089 Restructuring
— —
905 1,112 2,000 Other
3,817 3,157
4,120 3,480 3,726
Total operating expense
71,843 61,670
64,731 66,709 67,407
Income before income taxes
24,762 28,351 23,768
24,325 20,106 Income tax expense
7,247
8,652 7,626 7,438 5,638
Net income from continuing operations
17,515 19,699
16,142 16,887 14,468 Net income from discontinued operations (1)
1,184 1,047 1,245
2,065 1,455 Net income before
attribution to noncontrolling interests
18,699 20,746 17,387
18,952 15,923 Less: Net income attributable to noncontrolling
interests
1,147 1,110 989
911 921
Net income
attributable to the Company $ 17,552 $
19,636 $ 16,398 $ 18,041 $ 15,002
Boston Private Financial Holdings, Inc.
Selected Financial Data
(Unaudited) Year Ended (In thousands, except share
and per share data)
12/31/2016 12/31/2015 Interest
and dividend income: Loans
$ 201,349 $ 192,184
Taxable investment securities
6,230 4,403 Non-taxable
investment securities
5,754 4,758 Mortgage-backed securities
12,416 10,933 Federal funds sold and other
1,890 1,390 Total interest and dividend
income
227,639 213,668
Interest expense: Deposits
16,571 16,002 Federal Home
Loan Bank borrowings
8,008 7,959 Junior subordinated
debentures
2,427 3,875 Repurchase agreements and other
short-term borrowings
195 62
Total interest expense
27,201 27,898
Net interest income
200,438 185,770 Provision/
(credit) for loan losses
(6,935 )
(1,555 ) Net interest income after provision/ (credit) for loan
losses
207,373 187,325
Fees
and other income: Investment management fees
44,410
45,694 Wealth advisory fees
50,581 50,437 Wealth management
and trust fees
43,980 51,309 Other banking fee income
12,050 8,440 Gain on sale of loans, net
667
1,207 Total core fees and income
151,688 157,087 Gain/ (loss) on sale of
investments, net
521 236 Gain/ (loss) on OREO, net
306 124 Gain on sale of offices
2,862 — Other
3,410 3,722 Total other income
7,099 4,082
Operating expense:
Salaries and employee benefits
163,767 159,401 Occupancy and
equipment
39,075 37,183 Professional services
11,576
12,861 Marketing and business development
7,626 9,063
Contract services and data processing
7,024 6,037
Amortization of intangibles
6,282 6,711 Impairment of
goodwill
9,528 — FDIC insurance
3,484 3,979
Restructuring
2,017 3,724 Other
14,574
16,222 Total operating expense
264,953
255,181 Income before income taxes
101,207 93,313 Income tax expense
30,963
30,392 Net income from continuing operations
70,244 62,921 Net income from discontinued operations (1)
5,541 6,411 Net income before
attribution to noncontrolling interests
75,785 69,332 Less:
Net income attributable to noncontrolling interests
4,157 4,407
Net income attributable
to the Company $ 71,628 $ 64,925
Boston
Private Financial Holdings, Inc. Selected Financial Data
(Unaudited) (In thousands, except share and per share data)
Three Months Ended PER SHARE DATA: 12/31/2016
9/30/2016 6/30/2016 3/31/2016
12/31/2015 Calculation of Income for EPS: Net income
attributable to the Company
$ 17,552 $ 19,636 $
16,398 $ 18,041 $ 15,002 Adjustments to Net Income Attributable to
the Company to arrive at Net Income Attributable to Common
Shareholders, treasury stock method (2)
(1,798
) (1,006 ) (970 ) (289 ) (1,182
)
Net Income Attributable to the Common Shareholders, treasury
stock method $ 15,755 $ 18,630 $
15,428 $ 17,752 $ 13,820
End of
Period Common Shares Outstanding 83,731,769 83,194,714
83,380,426 83,023,755 83,410,961
Weighted Average Shares
Outstanding: Weighted average basic shares outstanding
81,217,391 81,301,499 81,236,809 81,301,499 81,134,931
Weighted average diluted shares outstanding (3)
83,438,137
83,562,283 83,519,939 83,279,866 83,579,050
Diluted Total
Earnings per Share $ 0.19 $ 0.22 $ 0.18 $ 0.21 $
0.17 (In thousands,
except share and per share data)
Year Ended PER SHARE
DATA: 12/31/2016 12/31/2015 Calculation of
Income for EPS: Net income attributable to the Company
$
71,628 $ 64,925 Adjustments to Net Income Attributable to
the Company to arrive at Net Income Attributable to Common
Shareholders, treasury stock method (2)
(4,063
) (3,011 )
Net Income Attributable to the Common
Shareholders, treasury stock method $ 67,565
$ 61,914
Weighted Average Shares
Outstanding: Weighted average basic shares outstanding
81,264,273 80,885,253 Weighted average diluted shares
outstanding (3)
83,209,126 83,225,153
Diluted
Total Earnings per Share $ 0.81 $ 0.74
Boston Private
Financial Holdings, Inc. Selected Financial Data
(Unaudited) (In thousands, except per share data)
FINANCIAL DATA: 12/31/2016 9/30/2016
6/30/2016 3/31/2016 12/31/2015 Book Value Per
Common Share
$ 8.61 $ 8.82 $ 8.71 $ 8.60 $ 8.38
Tangible Book Value Per Share (4)
$ 6.59 $ 6.65 $
6.53 $ 6.39 $ 6.16 Market Price Per Share
$ 16.55 $
12.83 $ 11.78 $ 11.45 $ 11.34
ASSETS UNDER MANAGEMENT AND
ADVISORY: Wealth Management and Trust
$ 7,008,000
$ 7,334,000 7,313,000 7,137,000 $ 7,976,000 Investment Managers
10,571,000 10,176,000 10,006,000 9,838,000 9,952,000 Wealth
Advisory
9,989,000 10,028,000 9,974,000 9,857,000 9,688,000
Less: Inter-company Relationship
(11,000 )
(11,000 ) (17,000 ) (21,000 ) (21,000 )
Total Assets Under Management and Advisory
$
27,557,000 $ 27,527,000 27,276,000
26,811,000 $ 27,595,000
FINANCIAL RATIOS:
Total Equity/ Total Assets
9.64 % 10.17 % 10.21 %
10.28 % 9.90 % Tangible Common Equity/ Tangible Assets (4)
7.07 % 7.38 % 7.36 % 7.34 % 6.98 % Tier I Common
Equity/ Risk Weighted Assets (4)
10.00 % 10.02 % 9.95
% 9.92 % 9.80 % Allowance for Loan Losses/ Total Loans
1.28
% 1.32 % 1.32 % 1.35 % 1.37 % Allowance for Loan Losses/
Nonaccrual Loans
451 % 471 % 395 % 314 % 295 %
Return on Average Assets - Three Months Ended (Annualized)
0.89 % 1.03 % 0.88 % 0.99 % 0.81 % Return on Average
Common Equity - Three Months Ended (Annualized) (5)
9.07
% 10.20 % 8.68 % 9.84 % 8.06 % Return on Average Tangible
Common Equity - Three Months Ended (Annualized) (5)
12.75
% 14.30 % 12.43 % 14.11 % 11.92 % Efficiency Ratio - Three
Months Ended (6)
61.87 % 65.04 % 70.41 % 70.87 %
71.59 %
DEPOSIT DETAIL: Demand deposits
(noninterest-bearing)
$ 1,753,648 $ 1,770,631 $
1,636,273 $ 1,609,669 $ 1,689,604 NOW
578,657 556,096
547,777 565,394 588,337 Savings
74,162 74,866 70,553 76,019
72,336 Money market
3,102,048 2,879,952 2,771,080 2,959,328
3,105,172 Certificates of deposit
576,631
530,698 510,409 576,450
584,988 Total Deposits
$ 6,085,146
$ 5,812,243 $ 5,536,092 $ 5,786,860 $
6,040,437
Boston
Private Financial Holdings, Inc. Selected Financial Data
(Unaudited) Average Balance Interest
Income/Expense Average Yield/Rate (In thousands)
Three Months Ended Three Months Ended Three Months
Ended AVERAGE BALANCE SHEET: 12/31/16
09/30/16 12/31/15 12/31/16 09/30/16
12/31/15 12/31/16 09/30/16 12/31/15
AVERAGE ASSETS Interest-Earning Assets: Cash and
Investments: Taxable investment securities
$ 375,913
$ 372,852 $ 368,573
$ 1,592 $ 1,537 $ 1,239
1.69 % 1.65 % 1.35 % Non-taxable investment
securities (9)
285,330 271,864 258,755
2,338 2,221
2,074
3.28 % 3.27 % 3.21 % Mortgage-backed securities
679,644 629,748 526,987
3,290 3,079 2,863
1.94
% 1.96 % 2.17 % Federal funds sold and other
130,740 152,892 220,618
508
469 449
1.53 % 1.20 % 0.80 % Total Cash
and Investments
1,471,627 1,427,356
1,374,933
7,728 7,306 6,625
2.10
% 2.05 % 1.92 % Loans (10): Commercial and Industrial (9)
1,110,268 1,065,787 1,053,290
10,892 10,626 10,865
3.84 % 3.90 % 4.04 % Commercial Real Estate (9)
2,109,601 1,976,327 1,897,943
21,153 19,860 19,981
3.92 % 3.93 % 4.12 % Construction and Land
96,242 117,183 182,648
1,018 1,263 1,634
4.14
% 4.22 % 3.50 % Residential
2,350,644 2,300,392
2,224,614
17,999 17,812 17,272
3.06 % 3.10 %
3.11 % Home Equity
117,985 122,505 117,892
1,050
1,105 1,015
3.54 % 3.59 % 3.41 % Other Consumer
188,908 182,315 166,184
1,323 1,154 967
2.79 % 2.52 %
2.31 % Total Loans
5,973,648 5,764,509
5,642,571
53,435 51,820 51,734
3.53 % 3.55 % 3.62 % Total Earning Assets
7,445,275 7,191,865 7,017,504
61,163 59,126 58,359
3.25 % 3.25
% 3.28 % LESS: Allowance for Loan Losses
79,440 76,424
79,389 Cash and due From Banks (Non-Interest Bearing)
39,133
39,301 39,453 Other Assets
427,545 445,517
411,642
TOTAL AVERAGE ASSETS $
7,832,513 $ 7,600,259 $ 7,389,210
AVERAGE LIABILITIES,
RNCI, AND
SHAREHOLDERS' EQUITY
Interest-Bearing Liabilities: Interest-Bearing Deposits (10): NOW
$ 567,538 $ 551,085 $ 512,973
$ 126 $
120 $ 82
0.09 % 0.09 % 0.06 % Savings
76,033
76,999 73,380
18 25 23
0.09 % 0.13 % 0.12 %
Money Market
2,969,292 2,922,687 3,063,533
2,807
2,877 2,995
0.38 % 0.39 % 0.39 % Certificates of
Deposit
563,045 560,546 593,286
1,201 1,141 1,181
0.85 % 0.81 %
0.79 % Total Interest-Bearing Deposits (14)
4,175,908
4,111,317 4,243,172
4,152 4,163 4,281
0.40 %
0.40 % 0.40 % Junior Subordinated Debentures
106,363 106,363
106,363
674 591 973
2.48 % 2.17 % 3.58 % FHLB
Borrowings and Other
742,247 624,528
491,115
2,064 1,978 1,968
1.09
% 1.24 % 1.57 % Total Interest-Bearing Liabilities
5,024,518 4,842,208 4,840,650
6,890 6,732 7,222
0.54 % 0.55 %
0.59 % Noninterest Bearing Demand Deposits (10) (14)
1,870,130 1,824,548 1,673,122 Payables and Other Liabilities
140,006 135,901 110,951 Total Average
Liabilities
7,034,654 6,802,657 6,624,723 Redeemable
Noncontrolling Interests
20,393 19,504 21,337 Average
Shareholders' Equity
777,466 778,098
743,150
TOTAL AVERAGE LIABILITIES, RNCI, AND SHAREHOLDERS'
EQUITY $ 7,832,513 $ 7,600,259 $ 7,389,210 Net
Interest Income - on a Fully Taxable Equivalent Basis (FTE)
$ 54,273 $ 52,394 $ 51,137 LESS: FTE Adjustment (9)
2,754 2,523 2,997 Net Interest Income
(GAAP Basis)
$ 51,519 $ 49,871 $ 48,140 Interest Rate
Spread
2.71 % 2.70 % 2.69 % Bank only Net Interest
Margin
2.91 % 2.92 % 2.94 % Net Interest Margin
2.88 % 2.88 % 2.88 %
Boston Private Financial Holdings, Inc.
Selected Financial Data (Unaudited) Average
Balance Interest Income/Expense Average
Yield/Rate (In thousands)
Year Ended Year Ended
Year Ended AVERAGE BALANCE SHEET: 12/31/16
12/31/15 12/31/16 12/31/15 12/31/16
12/31/15 AVERAGE ASSETS Interest-Earning Assets: Cash
and Investments: Taxable investment securities
$
373,937 $ 343,130
$ 6,230 $ 4,403
1.67
% 1.28 % Non-taxable investment securities (9)
270,320 245,402
8,850 7,320
3.27 % 2.98
% Mortgage-backed securities
615,873 527,057
12,416
10,933
2.02 % 2.07 % Federal funds sold and other
152,616 167,847
1,890
1,390
1.24 % 0.83 % Total Cash and Investments
1,412,746 1,283,436
29,386
24,046
2.08 % 1.87 % Loans (10): Commercial and
Industrial (9)
1,081,658 1,000,139
43,250 42,879
4.00 % 4.29 % Commercial Real Estate (9)
1,964,544 1,820,142
80,369 76,770
4.09
% 4.22 % Construction and Land
134,651 156,669
5,385 5,404
4.00 % 3.45 % Residential
2,284,478 2,183,830
70,553 67,648
3.09
% 3.10 % Home Equity
120,878 117,520
4,310
4,084
3.57 % 3.48 % Other Consumer
176,683 167,297
4,516 3,872
2.56 % 2.31 % Total Loans
5,762,892
5,445,597
208,383 200,657
3.62
% 3.68 % Total Earning Assets
7,175,638
6,729,033
237,769 224,703
3.31 %
3.34 % LESS: Allowance for Loan Losses
78,368 78,164 Cash
and due From Banks (Non-Interest Bearing)
39,669 39,513
Other Assets
430,972 410,375
TOTAL AVERAGE
ASSETS $ 7,567,911 $ 7,100,757
AVERAGE
LIABILITIES, RNCI, AND
SHAREHOLDERS' EQUITY
Interest-Bearing Liabilities: Interest-Bearing Deposits (10): NOW
$ 553,981 $ 516,720
$ 437 $ 318
0.08 % 0.06 % Savings
75,977 72,275
89
81
0.12 % 0.11 % Money Market
2,960,702
2,894,615
11,422 10,871
0.39 % 0.38 %
Certificates of Deposit
565,274 597,153
4,623 4,732
0.82 % 0.79 % Total
Interest-Bearing Deposits (14)
4,155,934 4,080,763
16,571 16,002
0.40 % 0.39 % Junior
Subordinated Debentures
106,363 106,363
2,427 3,875
2.28 % 3.64 % FHLB Borrowings and Other
652,998 516,237
8,203 8,021
1.26 % 1.55 % Total Interest-Bearing Liabilities
4,915,295 4,703,363
27,201
27,898
0.55 % 0.59 % Noninterest Bearing
Demand Deposits (10) (14)
1,736,637 1,542,254 Payables and
Other Liabilities
126,039 103,669 Total
Average Liabilities
6,777,971 6,349,286 Redeemable
Noncontrolling Interests
20,323 21,982 Average Shareholders'
Equity
769,617 729,489
TOTAL AVERAGE
LIABILITIES, RNCI, AND
SHAREHOLDERS' EQUITY
$ 7,567,911 $ 7,100,757 Net Interest Income - on a
Fully Taxable Equivalent Basis (FTE)
$ 210,568 $
196,805 LESS: FTE Adjustment (9)
10,130 11,035
Net Interest Income (GAAP Basis)
$ 200,438 $ 185,770
Interest Rate Spread
2.76 % 2.75 % Bank only Net
Interest Margin
2.95 % 2.99 % Net Interest Margin
2.93 % 2.92 %
Boston Private Financial
Holdings, Inc.
Selected
Financial Data (Unaudited) (In thousands)
LOAN DATA (11):
12/31/2016 9/30/2016
6/30/2016 3/31/2016 12/31/2015
Other Commercial and Industrial Loans: New England
$
493,451 $ 461,201 $ 428,515 $ 457,520 $ 500,389 San
Francisco Bay Area
50,578 59,936 64,762 66,629 70,702
Southern California
67,341 67,583
66,379 68,640 61,928 Total Other Commercial and
Industrial Loans
$ 611,370 $ 588,720 $ 559,656 $
592,789 $ 633,019 Commercial Tax Exempt Loans: New England
$
317,691 $ 263,418 $ 260,739 $ 268,270 $ 267,595 San
Francisco Bay Area
69,064 69,366 51,462 51,756 52,052
Southern California
11,849 11,918
11,986 12,053 12,120 Total Commercial Tax Exempt
Loans
$ 398,604 $ 344,702 $ 324,187 $ 332,079 $
331,767 Total Commercial and Industrial Loans
$
1,009,974 $ 933,422 $ 883,843 $ 924,868 $ 964,786 Commercial
Real Estate Loans: New England
$ 1,012,284 $ 987,758
$ 923,035 $ 940,149 $ 925,402 San Francisco Bay Area
637,042
611,224 633,735 611,461 622,123 Southern California
652,918 621,336 579,616 519,012
513,378 Total Commercial Real Estate Loans
$
2,302,244 $ 2,220,318 $ 2,136,386 $ 2,070,622 $ 2,060,903
Construction and Land Loans: New England
$ 47,434 $
56,268 $ 90,408 $ 106,258 $ 106,048 San Francisco Bay Area
29,629 26,400 36,808 35,281 52,876 Southern California
27,776 16,028 15,333 25,135
24,510 Total Construction and Land Loans
$
104,839 $ 98,696 $ 142,549 $ 166,674 $ 183,434 Residential
Loans: New England
$ 1,456,592 $ 1,409,385 $
1,385,102 $ 1,361,547 $ 1,368,192 San Francisco Bay Area
473,102 476,986 470,694 463,645 462,327 Southern California
450,167 429,719 424,320 391,683
399,021 Total Residential Loans
$ 2,379,861 $
2,316,090 $ 2,280,116 $ 2,216,875 $ 2,229,540 Home Equity Loans:
New England
$ 87,280 $ 90,592 $ 91,728 $ 84,693 $
83,712 San Francisco Bay Area
25,129 23,826 26,714 26,134
28,966 Southern California
6,408 6,851
7,044 7,980 7,150 Total Home Equity Loans
$
118,817 $ 121,269 $ 125,486 $ 118,807 $ 119,828 Other
Consumer Loans: New England
$ 186,680 $ 167,140 $
166,998 $ 145,450 $ 152,984 San Francisco Bay Area
7,517
6,764 8,299 8,347 4,530 Southern California
4,422
5,799 7,820 6,538 3,207 Total Other
Consumer Loans
$ 198,619 $ 179,703 $ 183,117 $
160,335 $ 160,721 Total Loans: New England
$
3,601,412 $ 3,435,762 $ 3,346,525 $ 3,363,887 $ 3,404,322
San Francisco Bay Area
1,292,061 1,274,502 1,292,474
1,263,253 1,293,576 Southern California
1,220,881
1,159,234 1,112,498 1,031,041 1,021,314
Total Loans
$ 6,114,354 $ 5,869,498 $ 5,751,497 $
5,658,181 $ 5,719,212
Boston Private Financial Holdings,
Inc.
Selected
Financial Data (Unaudited) (In thousands)
CREDIT QUALITY (11):
12/31/2016 9/30/2016
6/30/2016 3/31/2016
12/31/2015 Special Mention Loans: New England
$ 14,750 $ 25,248 $ 27,903 $ 38,927 $ 40,121 San
Francisco Bay Area
21,901 22,786 24,381 23,288 15,764
Southern California
884 6,278
15,044 24,710 13,326 Total Special
Mention Loans
$ 37,535 $ 54,312 $ 67,328 $
86,925 $ 69,211
Accruing Substandard Loans (12):
New England
$ 10,972 $ 19,748 $ 17,447 $ 19,157 $
22,026 San Francisco Bay Area
15,890 19,157 19,750 20,235
19,990 Southern California
36,809
49,148 27,027 16,299 16,398
Total Accruing Substandard Loans
$ 63,671 $
88,053 $ 64,224 $ 55,691 $ 58,414 Nonaccruing Loans:
New England
$ 10,081 $ 11,020 $ 13,028 $ 17,988 $
19,572 San Francisco Bay Area
2,989 3,543 4,196 4,369 4,977
Southern California
4,245 1,928
1,964 1,999 2,022 Total Nonaccruing
Loans
$ 17,315 $ 16,491 $ 19,188 $ 24,356
$ 26,571 Other Real Estate Owned: New England
$ 1,690 $ 1,800 $ 2,042 $ 98 $ 191 San Francisco Bay
Area
— — — — 585 Southern California
—
— — — — Total Other Real
Estate Owned
$ 1,690 $ 1,800 $ 2,042 $ 98
$ 776
Loans 30-89 Days Past Due and Accruing
(13):
New England
$ 10,311 $ 2,735 $ 5,213 $ 4,723 $ 7,118
San Francisco Bay Area
591 1,018 70 986 2,806 Southern
California
4,235 836 2,343
2,598 3,170 Total Loans 30-89 Days Past
Due and Accruing
$ 15,137 $ 4,589 $ 7,626 $
8,307 $ 13,094 Loans (Charged-off)/ Recovered, Net
for the Three Months Ended: New England
$ 1,120 $
1,704 $ 1,276 $ (2,146 ) $ 120 San Francisco Bay Area
384
318 537 3,454 703 Southern California
33
32 48 (248 ) 86 Total Net Loans
(Charged-off)/ Recovered
$ 1,537 $ 2,054 $
1,861 $ 1,060 $ 909 Loans (Charged-off)/ Recovered,
Net for the Twelve Months Ended: New England
$ 1,954
$ (502 ) San Francisco Bay Area
4,693 4,217 Southern
California
(135 ) 502 Total Net
Loans (Charged-off)/ Recovered
$ 6,512 $ 4,217
Boston Private
Financial Holdings, Inc. Selected Financial Data
(Unaudited) FOOTNOTES: (1 ) Net income from
discontinued operations consists of contingent payments or expenses
related to our divested affiliates, including Westfield Capital
Management Company, LLC.
(2
)
Adjustments to net income attributable to the Company to arrive at
net income attributable to the common shareholders, as presented in
these tables, include decrease/ (increase) in noncontrolling
interests redemption value and dividends paid on preferred stock.
(3 ) When the Company has positive net income from
continuing operations attributable to the common shareholders, the
Company adds additional shares to basic weighted average shares
outstanding to arrive at diluted weighted average shares
outstanding for the diluted earnings per share calculation. These
additional shares reflect the assumed exercise, conversion, or
contingent issuance of dilutive securities. If the additional
shares would result in anti-dilution they would be excluded from
the diluted earnings per share calculation. The potential dilutive
shares relate to: unexercised stock options, unvested restricted
stock, and unexercised stock warrants. See Part II. Item 8.
"Financial Statements and Supplementary Data - Note 16: Earnings
Per Share" in the Company's Annual Report on Form 10-K for the year
ended December 31, 2015 for additional information. (4 )
The Company uses certain non-GAAP
financial measures, such as: Tangible Book Value Per Share and the
Tangible Common Equity ("TCE") to Tangible Assets ("TA") ratio to
provide information for investors to effectively analyze financial
trends of ongoing business activities, and to enhance comparability
with peers across the financial sector.
Reconciliations from the Company's GAAP Total Equity to
Total Assets ratio to the Non-GAAP TCE to TA ratio, and from GAAP
Book Value to Non-GAAP Tangible Book Value are presented below:
The Company calculates Tangible Assets by adjusting Total
Assets to exclude Goodwill and Intangible Assets. The
Company calculates Tangible Common Equity by adjusting Total Equity
to exclude non-convertible Series D Preferred stock and exclude
Goodwill and Intangible Assets, net. (In thousands, except
per share data)
12/31/2016
9/30/2016 6/30/2016
3/31/2016 12/31/2015 Total
Balance Sheet Assets
$ 7,970,474 $ 7,681,550 $
7,579,601 $ 7,413,663 $ 7,542,508 LESS: Goodwill and Intangible
Assets, net
(169,279 ) (180,349 )
(181,918 ) (183,504 ) (185,089 ) Tangible
Assets (non-GAAP)
$ 7,801,195 $ 7,501,201 $ 7,397,683
$ 7,230,159 $ 7,357,419 Total Shareholders' Equity
$
768,481 $ 781,488 $ 774,140 $ 762,145 $ 746,613 LESS: Series
D Preferred Stock (non-convertible)
(47,753 ) (47,753
) (47,753 ) (47,753 ) (47,753 ) LESS: Goodwill and Intangible
Assets, net
(169,279 ) (180,349 )
(181,918 ) (183,504 ) (185,089 ) Total
adjusting items
(217,032 ) (228,102 )
(229,671 ) (231,257 ) (232,842 ) Tangible
Common Equity (non-GAAP)
$ 551,449 $ 553,386
$ 544,469 $ 530,888 $ 513,771 Total
Equity/Total Assets
9.64 % 10.17 % 10.21 % 10.28 %
9.90 % Tangible Common Equity/Tangible Assets (non-GAAP)
7.07 % 7.38 % 7.36 % 7.34 % 6.98 % Total Risk
Weighted Assets *
$ 5,714,598 $ 5,534,711 $ 5,464,529
$ 5,412,514 $ 5,449,239 Tier I Common Equity *
$
571,665 $ 554,368 $ 543,801 $ 536,925 $ 534,241 Tier I
Common Equity/ Risk Weighted Assets
10.00 % 10.02 %
9.95 % 9.92 % 9.80 % End of Period Shares Outstanding
83,731,769 83,194,714 83,380,426 83,023,755 83,410,961
Book Value Per Common Share
$ 8.61 $ 8.82 $
8.71 $ 8.60 $ 8.38 Tangible Book Value Per Share (non-GAAP)
$ 6.59 $ 6.65 $ 6.53 $ 6.39 $ 6.16 * Risk Weighted
Assets and Tier I Common Equity for December 31, 2016 are presented
based on estimated data. (5 ) The Company uses certain
non-GAAP financial measures, such as: Return on Average Common
Equity and Return on Average Tangible Common Equity to provide
information for investors to effectively analyze financial trends
of ongoing business activities, and to enhance comparability with
peers across the financial sector. Reconciliations from the
Company's GAAP Return on Average Equity ratio to the Non-GAAP
Return on Average Common Equity ratio, and the Non-GAAP Return on
Average Tangible Common Equity ratio are presented below:
The Company annualizes income data based on the number of days in
the period presented and a 365 day year. The Company calculates
Average Common Equity by adjusting Average Equity to exclude
Average Preferred Equity. The Company calculates Average Tangible
Common Equity by adjusting Average Equity to exclude Average
Goodwill and Intangible Assets, net and Average Preferred Equity.
Three Months Ended (In thousands)
12/31/2016 9/30/2016
6/30/2016 3/31/2016
12/31/2015 Total average shareholders' equity
$ 777,466 $ 778,098 $ 765,063 $ 755,400 $ 743,150
LESS: Average Series D preferred stock (non-convertible)
(47,753 ) (47,753 ) (47,753 )
(47,753 ) (47,753 ) Average common equity (non-GAAP)
729,713 730,345 717,310
707,647 695,397 LESS: Average goodwill
and intangible assets, net
(179,535 )
(181,191 ) (182,787 ) (184,415 ) (185,983 )
Average Tangible Common Equity (non-GAAP)
$ 550,178
$ 549,154 $ 534,523 $ 523,232 $ 509,414
Net income attributable to the Company
$
17,552 $ 19,636 $ 16,398 $ 18,041 $ 15,002 LESS: Dividends
on Series D preferred stock
(869 ) (868
) (869 ) (869 ) (869 ) Common net income
(non-GAAP)
16,683 18,768 15,529 17,172 14,133 ADD:
Amortization of intangibles, net of tax (35%)
1,002
1,019 1,031 1,031
1,169 Tangible common net income (non-GAAP)
$
17,685 $ 19,787 $ 16,560 $ 18,203
$ 15,302 Return on Average Equity -
(Annualized)
8.96 % 10.01 % 8.60 % 9.69 % 8.01 %
Return on Average Common Equity - (Annualized) (non-GAAP)
9.07 % 10.20 % 8.68 % 9.84 % 8.06 % Return on Average
Tangible Common Equity - (Annualized) (non-GAAP)
12.75
% 14.30 % 12.43 % 14.11 % 11.92 %
Year ended
(In thousands)
12/31/2016
12/31/2015 Total average shareholders' equity $
769,617 $ 729,489 LESS: Average Series D preferred stock
(non-convertible) (47,753 ) (47,753 ) Average common
equity (non-GAAP) 721,864 681,736 LESS:
Average goodwill and intangible assets, net (181,976 )
(188,533 ) Average Tangible Common Equity (non-GAAP) $
539,888 $ 493,203 Net income attributable to
the Company $ 71,628 $ 64,925 LESS: Dividends on Series D preferred
stock (3,475 ) (3,475 ) Common net income (non-GAAP)
68,153 61,450 ADD: Amortization of intangibles, net of tax (35%)
4,083 4,362 Tangible common net income
(non-GAAP) $ 72,236 $ 65,812 Return on Average
Equity - (Annualized) 9.31 % 8.90 % Return on Average Common Equity
- (Annualized) (non-GAAP) 9.44 % 9.01 % Return on Average Tangible
Common Equity - (Annualized) (non-GAAP) 13.38 % 13.34 %
(6
)
The Company uses certain non-GAAP financial measures, such as:
pre-tax, pre-provision earnings, total operating expenses excluding
amortization of intangibles, goodwill impairment, and restructuring
expense, and the efficiency ratio to provide information for
investors to effectively analyze financial trends of ongoing
business activities, and to enhance comparability with peers across
the financial sector.
Reconciliations from the Company's GAAP
income from continuing operations before income taxes to non-GAAP
pre-tax, pre-provision earnings; from GAAP total operating expense
to non-GAAP total operating expense excluding amortization of
intangibles, goodwill impairment, and restructuring; and from GAAP
efficiency ratio to Non-GAAP efficiency ratio (FTE basis),
excluding amortization of intangibles, goodwill impairment, and
restructuring, are presented below:
Three Months Ended (In thousands)
12/31/2016 9/30/2016
6/30/2016 3/31/2016
12/31/2015 Income before income taxes (GAAP)
$
24,762 $ 28,351 $ 23,768 $ 24,325 $ 20,106 ADD BACK:
Provision/ (credit) for loan losses
(1,128 )
(138 ) (2,535 ) (3,133 ) (1,655 )
Pre-tax, pre-provision earnings (non-GAAP)
$ 23,634 $
28,213 $ 21,233 $ 21,192 $ 18,451 Total operating expense
(GAAP)
$ 71,843 $ 61,670 $ 64,731 $ 66,709 $ 67,407
Less: Amortization of intangibles
1,542 1,568 1,586 1,586
1,799 Less: Goodwill impairment
9,528 — — — — Less:
Restructuring
— — 905
1,112 2,000
Total operating expense (excluding
amortization of intangibles, goodwill impairment, and
restructuring) (non-GAAP)
$ 60,773 $ 60,102 $ 62,240 $ 64,011 $ 63,608
Net interest income
$ 51,519 $ 49,871 $ 49,169 $
49,879 $ 48,140 Total core fees and income
38,499 37,896
37,565 37,728 37,137 Total other income
5,459 2,116 (770 )
294 581 FTE income
2,754 2,523
2,437 2,416 2,997 Total
revenue (FTE basis)
$ 98,231 $ 92,406 $ 88,401 $
90,317 $ 88,855 Efficiency Ratio (GAAP)
75.25 % 68.61
% 75.30 % 75.89 % 78.51 % Efficiency Ratio, FTE Basis excluding
amortization of intangibles, goodwill impairment, and restructuring
(non-GAAP)
61.87 % 65.04 % 70.41 % 70.87 % 71.59 %
Year ended (In thousands)
12/31/2016
12/31/2015 Income before income taxes
(GAAP)
$ 101,207 $ 93,313 ADD BACK: Provision/
(credit) for loan losses
(6,935 )
(1,555 ) Pre-tax, pre-provision earnings (non-GAAP)
$
94,272 $ 91,758 Total operating expense (GAAP)
$ 264,953 $ 255,181 Less: Amortization of intangibles
6,282 6,711 Less: Goodwill impairment
9,528 — Less:
Restructuring
2,017 3,724
Total operating expense (excluding
amortization of intangibles, goodwill impairment, and
restructuring) (non-GAAP)
$ 247,126 $ 244,746 Net interest income
$ 200,438 $ 185,770 Total core fees and income
151,688 157,087 Total other income
7,099 4,082 FTE
income
10,130 11,035 Total
revenue (FTE basis)
$ 369,355 $ 357,974 Efficiency
Ratio (GAAP)
73.76 % 73.55 % Efficiency Ratio, FTE
Basis excluding amortization of intangibles, goodwill impairment,
and restructuring (non-GAAP)
66.91 % 68.37 %
(7 )
The Company uses certain non-GAAP
financial measures, such as: net income attributable to the Company
excluding notable items and diluted earnings per share excluding
notable items to provide information for investors to effectively
analyze financial trends of ongoing business activities, and to
enhance comparability with peers across the financial sector.
Reconciliations from the Company's GAAP net income
attributable to the Company to non-GAAP net income attributable to
the Company excluding notable items and from GAAP diluted earnings
per share to non-GAAP diluted earnings per share excluding notable
items are presented below:
Three Months Ended
(In thousands, except share and per share
data)
12/31/2016 9/30/2016
6/30/2016 3/31/2016
12/31/2015 Net income attributable to the
Company (GAAP)
$ 17,552 $ 19,636 $ 16,398 $ 18,041 $
15,002 LESS: Gain on sale of offices
2,862 — — — — ADD BACK:
Impairment of goodwill
9,528 — — — — Tax effect at 35%
statutory rate
(2,333 ) —
— — — Net income attributable to
the Company
excluding notable items (non-GAAP)
$ 21,885 $ 19,636 $ 16,398 $ 18,041 $ 15,002
Net Income Attributable to the Common Shareholders, treasury stock
method (GAAP)
$ 15,755 $ 18,630 $ 15,428 $ 17,752 $
13,820 LESS: Gain on sale of offices
2,862 — — — — ADD BACK:
Impairment of goodwill
9,528 — — — — Tax effect at 35%
statutory rate
(2,333 ) —
— — — Net Income Attributable to
the Common Shareholders, treasury stock method, excluding notable
items (non-GAAP)
$ 20,088 $ 18,630 $ 15,428 $ 17,752
$ 13,820 Weighted average diluted shares outstanding (3)
83,438,137 83,562,283 83,519,939 83,279,866 83,579,050
Diluted Total Earnings per Share (GAAP)
$ 0.19
$ 0.22 $ 0.18 $ 0.21 $ 0.17 Diluted Total Earnings per Share,
excluding notable items (non-GAAP)
$ 0.24 $ 0.22 $
0.18 $ 0.21 $ 0.17 (8 ) The Company uses certain non-GAAP
financial measures, such as: net interest income excluding interest
recovered on previous nonaccrual loans and net interest margin
excluding interest recovered on previous nonaccrual loans to
provide information for investors to effectively analyze financial
trends of ongoing business activities, and to enhance comparability
with peers across the financial sector. Reconciliations from
the Company's GAAP net interest income to non-GAAP net interest
income excluding interest recovered on previous nonaccrual loans;
and from GAAP net interest margin to non-GAAP net interest margin
excluding interest recovered on previous nonaccrual loans, are
presented below:
Three Months Ended (In thousands)
12/31/2016 9/30/2016
6/30/2016 3/31/2016
12/31/2015 Net interest income (GAAP basis)
$
51,519 $ 49,871 $ 49,169 $ 49,879 $ 48,140 ADD: FTE income
2,754 2,523 2,437
2,416 2,997 Net interest income, FTE
basis
54,273 52,394 51,606 52,295 51,137 LESS: Interest
recovered on previously nonaccrual loans
365
343 565 1,089 255
Net interest income, FTE basis, excluding interest recovered
on previously nonaccrual loans (non-GAAP)
53,908
52,051 51,041 51,206
50,882 Net Interest Margin (FTE basis)
2.88 % 2.88 % 2.91 % 2.96 % 2.88 % Net Interest
Margin, FTE basis, excluding interest recovered on previously
nonaccrual loans (non-GAAP)
2.86 % 2.86 % 2.88 % 2.90
% 2.86 % (9 ) Interest Income on Non-taxable Investments and
Loans are presented on an FTE basis using the federal statutory
rate of 35% for each period presented. (10 ) Average Loans
includes Loans Held for Sale and Nonaccrual Loans. Average Deposits
includes Deposits Held for Sale, if any. (11 ) The
concentration of the Private Banking loan data and credit quality
is primarily based on the location of the lender's regional
offices. (12 ) Accruing substandard loans include loans that
are classified as substandard but are still accruing interest
income. Boston Private Bank & Trust Company 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
nonaccrual at some time in the future. (13 ) In addition to
loans 30-89 days past due and accruing, at June 30, 2016, the
Company had one loan totaling $0.1 million that was more than 90
days past due but still on accrual status. This loan originated in
the San Francisco Bay Area region. At December 31, 2016, September
30, 2016, March 31, 2016, and December 31, 2015, the Company had no
loans outstanding more than 90 days past due but still on accrual
status. (14 ) Average Total Deposits is the sum of Average
Total Interest-Bearing Deposits and Average Noninterest Bearing
Demand Deposits.
View source
version on businesswire.com: http://www.businesswire.com/news/home/20170118006197/en/
Adam BromleyVice President Corporate Finance and Director of
Investor RelationsBoston Private Financial Holdings, Inc.(617)
912-4386abromley@bostonprivate.com
Boston Private Financial (NASDAQ:BPFH)
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