First Quarter Highlights:
- First quarter 2018 Net income
attributable to the Company was $22.7 million and Diluted earnings
per share was $0.27.
- Return on average common equity for the
first quarter was 12.0% and Return on average tangible common
equity was 15.2%.
- Average total deposits increased 1%
year-over-year to $6.4 billion, and Average total loans increased
6% year-over-year to $6.5 billion.
- Total assets under management ("AUM"),
excluding Anchor Capital Advisors LLC (“Anchor”), were $21.2
billion at the end of the first quarter, and Net flows during the
first quarter were $198 million.
Boston Private Financial Holdings, Inc. (NASDAQ: BPFH) (the
“Company” or “BPFH”) today reported first quarter 2018 GAAP Net
income attributable to the Company of $22.7 million, compared to a
Net loss of $18.3 million for the fourth quarter of 2017 and Net
income of $15.7 million for the first quarter of 2017. First
quarter 2018 Diluted earnings / (loss) per share were $0.27,
compared to $(0.24) in the fourth quarter of 2017, and $0.17 in the
first quarter of 2017.
Summary Financial Results -
Reported % Change ($ in millions, except for per share
data)
1Q18 4Q17 1Q17
LinkedQuarter
Year overYear
Net income/ (loss) attributable to the Company $22.7 $(18.3) $15.7
nm 45 % Diluted earnings/ (loss) per share $0.27 $(0.24) $0.17 nm
59 %
Non-GAAP
Financial Measures:
Pre-tax, pre-provision income $26.3 $2.5 $21.4 nm 23 % Return on
average common equity 12.0 % (9.9 )% 8.3 % Return on average
tangible common equity 15.2 % (11.9 )% 11.4 % nm = not meaningful
In addition to presenting the Company’s results in conformity
with GAAP, the Company uses certain non-GAAP financial measures to
provide information for investors to effectively analyze financial
trends of ongoing business activities, and to enhance comparability
with peers across the financial sector. For
additional information on non-GAAP financial measures, see
page 6. A full reconciliation of GAAP to non-GAAP results can be
found in the footnotes beginning on page 16.
Summary Financial Results - Operating Basis
(non-GAAP) % Change ($ in millions, except
for per share data)
1Q18 4Q171 1Q17
LinkedQuarter Year overYear Net income/
(loss) attributable to the Company $22.7 $20.6 $15.7 10 % 45 %
Diluted earnings/ (loss) per share $0.27 $0.22 $0.17 23 % 59 %
Pre-tax, pre-provision income $26.3 $29.0 $21.4 (9 )% 23 %
Return on average common equity 12.0 % 10.2 % 8.3 % Return on
average tangible common equity 15.2 % 13.4 % 11.4 %
1 4Q17 results have been adjusted to exclude the impact of items
related to the divestiture of Anchor, impairment of goodwill and
the Tax Cuts and Jobs ActSee footnote 16 for a GAAP to non-GAAP
reconciliation
“Overall, we are pleased with this quarter's results. Our
Company demonstrated 59% year-over-year growth in diluted earnings
per share and achieved a 12.0% return on average common equity,”
said Clayton G. Deutsch, CEO. “This quarter's performance reflects
year-over-year pre-tax, pre-provision income growth of 23% with
positive operating leverage achieved through strong revenue growth
and expense growth in line with our expectations. We have worked
hard to return to positive operating leverage following stepped up
investments in staff and technology throughout 2017.”
“The bank continues to exhibit strong credit quality in the form
of lower Criticized and Classified loans, and our market-linked fee
businesses achieved positive net flows on a consolidated basis amid
increasing market volatility. Additionally, we announced that on
April 13, we successfully completed the sale of our ownership
interest in Anchor.”
Net Interest Income and Margin (non-GAAP, except
for Net Interest Income) % Change
($ in millions)
1Q18 4Q17 1Q17
LinkedQuarter Year overYear Net
interest income $57.4 $57.3 $53.6 —
% 7 % Add: FTE adjustment 1.0 2.9 2.8 (66 )%
(65 )%
Net interest income, FTE basis 58.4
60.1 56.5 (3 )% 3 % Less:
Interest recovered on previous nonaccrual loans 0.1 0.4 0.3 (81 )%
(73 )%
Core net interest income, FTE basis $58.3
$59.7 $56.2 (2 )% 4 %
Net interest margin (FTE basis) 2.95 % 3.04 % 2.94 % Core
net interest margin (FTE basis) 2.94 % 3.02 % 2.92 % Core net
interest margin (non-FTE basis) 2.90 % 2.87 % 2.78 %
Net interest income for the first quarter was $57.4 million,
flat linked quarter, and an increase of 7% year-over-year. The
year-over-year increase was primarily driven by higher yields on
interest-earning assets, and higher asset volumes, partially offset
by higher costs of deposits and borrowing volumes. The Company’s
Core net interest margin (non-FTE basis) increased 3 basis points
linked quarter to 2.90% driven primarily by higher asset yields and
a mix shift from investments to loans, partially offset by
increased deposit and borrowing costs.
Net interest margin (FTE basis) was 2.95% for the first quarter
of 2018, a decrease of 9 basis points from the fourth quarter of
2017 and an increase of 1 basis point from the first quarter of
2017. The linked quarter decrease was driven primarily by a lower
tax benefit on tax-exempt income.
Noninterest Income %
Change ($ in millions)
1Q18 4Q17 1Q17
LinkedQuarter
Year overYear Investment management fees $11.4 $12.3
$10.8 (7 )% 5 % Wealth advisory fees 13.5 13.5 12.8 — % 5 % Wealth
management and trust fees 12.2 11.8 10.8 3 % 12 % Private banking
fees2 2.3 2.6 1.8 (10 )% 28 %
Total core fees and income
$39.4 $40.2 $36.3 (2 )% 9
% Total other income $0.3 $(1.0) $0.2 nm 66 %
Total
noninterest income $39.7 $39.2 $36.5
1 % 9 %
2 Private banking fees includes Other banking fee income and
Gain/ (loss) on sale of loans, net
Total core fees and income for the first quarter were $39.4
million, a 2% decrease on a linked quarter basis and a 9% increase
year-over-year. The year-over-year increase was primarily driven by
higher levels of assets under management in the Investment
Management, Wealth Advisory, and Wealth Management and Trust
segments. Investment management fees declined on a linked quarter
basis primarily driven by $0.9 million of performance fees received
in the fourth quarter. Private banking fees increased on a
year-over-year basis due to increases in BOLI income.
Assets Under Management
% Change ($ in millions)
1Q18 4Q17 1Q17
LinkedQuarter Year overYear Wealth
Management and Trust $7,831 $7,865 $7,260 — % 8 % Investment
Management 3 1,920 2,004 1,849 (4 )% 4 % Wealth Advisory 11,446
11,350 10,579 1 % 8 %
Total assets under management 3
4 $21,186 $21,208 $19,677 —
% 8 % Net flows 1Q18
4Q17 1Q17 Wealth Management and Trust $77 $79 $34
Investment Management 3 (15) 20 30 Wealth Advisory 136 29 263
Total net flows 3 $198 $128 $327
3 Information excludes Anchor4 Segments do not sum to Total
assets under management due to $11 million intercompany
relationship
Total assets under management, excluding Anchor, were $21.2
billion at the end of the first quarter, flat linked quarter and an
increase of 8% year-over-year. The year-over-year increase was
driven primarily by positive market action and positive net
flows.
Operating Expense %
Change ($ in millions)
1Q18 4Q17 1Q17
LinkedQuarter Year overYear Salaries
and employee benefits $47.2 $43.9 $45.8 8 % 3 % Occupancy and
equipment 7.7 7.8 7.2 — % 8 % Professional services 3.2 4.0 3.3 (21
)% (4 )% Marketing and business development 1.6 1.9 1.7 (17 )% (4
)% Information systems 5.9 5.6 5.4 4 % 9 % Amortization of
intangibles 0.8 1.3 1.4 (43 )% (47 )% Impairment of goodwill - 24.9
- (100 )% nm FDIC insurance 0.7 0.7 0.8 10 % (3 )% Other 3.7 3.8
3.2 (2 )% 16 %
Total operating expense $70.9
$94.0 $68.8 (25 )% 3 %
Less: Impairment of goodwill - 24.9 - nm nm Less: Anchor
divestiture legal expense
- 0.4
- nm nm
Adjusted
operating expense (non-GAAP) 5 $70.9 $68.7
$68.8 3 % 3 %
5 For information on non-GAAP financial measures, see page 7
Adjusted operating expense for the first quarter of 2018 was
$70.9 million, up 3% linked quarter and 3% year-over-year. Salaries
and employee benefits expense increased 8% linked quarter primarily
driven by seasonal payroll expenses. The year-over-year increase in
Salaries and employee benefits in the first quarter is primarily
driven by incentive compensation and merit increases partially
offset by a decrease in vacation accruals. Information systems
expense increased 4% linked quarter and 9% year-over-year due to
information technology investments. Amortization of intangible
expense decreased 43% linked quarter primarily as a result of
classifying Anchor as held for sale.
Income Tax Expense
The effective tax rate for continuing operations (excluding
non-GAAP adjustments) for the first quarter decreased to 21.5% from
30.5% in the fourth quarter of 2017 and 30.7% in the first quarter
of 2017. The decrease was primarily driven by the decrease in the
corporate federal income tax rate from 35% to 21% enacted as part
of the Tax Cuts and Jobs Act on December 22, 2017.
Loans and Deposits - QTD
Averages % Change ($ in millions)
1Q18
4Q17 1Q17 LinkedQuarter Year
overYear Commercial and industrial $933 $962 $984 (3 )%
(5 )% Commercial real estate 2,441 2,370 2,324 3 % 5 % Construction
and land 169 131 114 29 % 49 % Residential 2,702 2,650 2,425 2 % 11
% Home equity 97 105 118 (7 )% (17 )% Other consumer 186 178 192 4
% (3 )%
Total loans $6,529 $6,396
$6,157 2 % 6 %
Non-interest bearing deposits
1,872 1,895 1,844 (1 )% 2 % Interest bearing deposits 4,516 4,550
4,455 (1 )% 1 %
Total deposits $6,388 $6,445
$6,299 (1 )% 1 %
Non-interest bearing deposits as a % of
Total deposits
29 % 29 % 29 %
Average total loans in the first quarter increased 6%
year-over-year driven primarily by increases in Residential and
Commercial real estate loans partially offset by a decrease in
Commercial and industrial loans.
Average total deposits increased 1% year-over-year. Average
non-interest bearing deposits comprised 29% of Average total
deposits in the first quarter of 2018 and the first quarter of
2017.
Provision and Asset
Quality ($ in millions)
1Q18 4Q17
3Q17 2Q17 1Q17 Provision/ (credit) for loan
loss $(1.8) $(0.9) $(0.4) $(6.1) $(0.2) Total criticized loans
124.1 154.8 146.0 129.5 135.1 Total nonaccrual loans 16.4 14.3 13.6
16.2 20.9 Total loans 30-89 days past due and accruing 20.4 25.0
5.3 3.2 28.7 Total net loans (charged-off)/ recovered - 0.8 0.3 3.1
0.1
Ratios: Allowance for loan losses as a % of Total
loans 1.10 % 1.15 % 1.17 % 1.19 % 1.25 % Nonaccrual loans as a % of
Total loans 0.25 % 0.22 % 0.21 % 0.26 % 0.34 %
The Company recorded a provision credit of $1.8 million for the
first quarter of 2018, compared to a credit of $0.9 million for the
fourth quarter of 2017 and a credit of $0.2 million for the first
quarter of 2017. The provision credit in the first quarter of 2018
was primarily driven by a decline in Total criticized loans and
improved loss rates, partially offset by loan growth.
Total criticized loans as of March 31, 2018 were $124.1 million,
decreases of 20% linked quarter and 8% year-over-year.
Total nonaccrual loans (“Nonaccruals”) as of March 31, 2018 were
$16.4 million, an increase of 15% linked quarter and a decrease of
22% year-over-year. As a percentage of Total loans, Nonaccruals
were 25 basis points as of March 31, 2018, up 3 basis points
compared to December 31, 2017, and down 9 basis points from March
31, 2017.
Capital
1Q18 4Q17 3Q17 2Q17 1Q17
Tangible common equity/ Total assets 7 7.4 % 7.3 % 7.4 % 7.4 % 7.0
% Tangible book value per share 7 $7.17 $7.12 $7.16 $6.97 $6.73
Regulatory Capital Ratios: 8 Tier 1 common
equity 10.4 % 10.3 % 10.4 % 10.3 % 10.0 % Total risk-based capital
14.2 % 14.1 % 14.3 % 14.1 % 13.8 % Tier 1 risk-based capital 12.9 %
12.9 % 13.0 % 12.9 % 12.6 % Tier 1 leverage capital 9.4 % 9.3 % 9.4
% 9.3 % 9.2 %
7 See footnote 6 for a GAAP to non-GAAP reconciliation.8 Current
quarter information is presented based on estimated data.
Tangible book value per share as of March 31, 2018 increased 7%
year-over-year to $7.17.
On March 28, 2018, the Company received a notice of
non-objection from the Federal Reserve for a share repurchase
program of up to $20 million of the Company’s outstanding shares.
Shares may be repurchased from time to time in the open market for
a two-year period.
Divestiture
On April 13, 2018, the Company completed the sale of its
ownership interest in Anchor. Anchor’s results remain consolidated
in the Company’s results during current and prior periods. For
presentation purposes, Anchor’s AUM are excluded from current and
prior period AUM amounts, but are included in the calculation of
Core Fees and Income. The Company classified the assets and
liabilities of Anchor as held for sale at March 31, 2018, which are
included with Other assets and Other liabilities, respectively, on
the Company’s consolidated balance sheet.
As a result of the transaction, Boston Private received
approximately $32 million of cash and will receive future revenue
share payments that have a net present value of approximately $15
million. During the second quarter, the Company will recognize a
tax expense of approximately $11 million to $12 million
attributable to the transaction. The net financial impact will
increase the Company’s Tier 1 common equity by approximately $34
million to $35 million.
Dividend Payments
Concurrent with the release of first quarter 2018 earnings, the
Board of Directors of the Company declared a cash dividend to
common shareholders of $0.12 per share. The record date for this
dividend is May 4, 2018, and the payment date is May 18, 2018.
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 May 15, 2018, and the payment date is June 15,
2018.
Non-GAAP Financial Measures
The Company uses certain non-GAAP financial measures to provide
information for investors to effectively analyze financial trends
of ongoing business activities, and to enhance comparability with
peers across the financial sector.
These non-GAAP financial measures include tangible book value
per share; the TCE/TA ratio; return on average common equity;
return on average tangible common equity; pre-tax, pre-provision
income; 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 interest
income and net interest margin excluding interest recovered on
previous nonaccrual loans, also referred to as core net interest
margin; net income attributable to the Company excluding notable
items; net income attributable to the common shareholders, treasury
stock method, excluding notable items (non-GAAP); diluted earnings
per share excluding notable items; operating basis total revenue;
operating basis total operating expenses; operating basis pre-tax,
pre-provision income; operating basis income before income taxes;
operating basis income tax expense; operating basis net income/
(loss) attributable to the Company; operating basis net income/
(loss) attributable to the Common Shareholders; operating basis
weighted average diluted shares outstanding; operating basis
diluted total earnings/ (loss) per share; operating basis return on
average common equity; operating basis return on average tangible
common equity; and operating basis effective tax rate.
A detailed reconciliation table of the Company’s GAAP to
non-GAAP measures is attached.
Conference Call
Management will hold a conference call at 8 a.m. Eastern Time on
Thursday, April 19, 2018, to discuss the financial results,
business highlights and outlook. To access the call:
Dial In #: (888) 317-6003Elite Entry Number: 1736451
Replay Information:Available from April 19, 2018 at 12 noon
until April 26, 2018Dial In #: (877) 344-7529Conference Number:
10118831
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, Trust, 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 $21 billion of client assets.
The Company’s affiliates 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 Statements
Certain 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, wealth advisory, and trust 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; operational
risks including, but not limited to, cybersecurity, fraud and
natural disasters; 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)
March 31, 2018 December
31, 2017 September 30, 2017
June 30, 2017 March 31, 2017
(In thousands, except share and per share data)
Assets: Cash and cash equivalents
$ 77,085 $
120,541 $ 110,440 $ 97,032 $ 165,186 Investment securities
available-for-sale
1,118,497 1,170,328 1,189,827 1,188,720
1,256,208 Investment securities held-to-maturity
70,809
74,576 84,090 99,024 98,424 Stock in Federal Home Loan Bank and
Federal Reserve Bank
54,455 59,973 61,714 45,568 50,133
Loans held for sale
3,918 4,697 1,957 2,870 350 Total loans
6,602,327 6,505,028 6,413,201 6,279,928 6,250,217 Less:
Allowance for loan losses
72,898 74,742 74,873
75,009 78,031 Net loans
6,529,429
6,430,286 6,338,328 6,204,919 6,172,186 Premises and equipment, net
43,627 37,640 36,546 34,135 32,974 Goodwill (1)
75,598 75,598 142,554 142,554 142,554 Intangible assets, net
(1)
15,334 16,083 22,447 23,873 25,299 Fees receivable
10,640 11,154 12,560 12,639 12,230 Accrued interest
receivable
22,614 22,322 21,823 20,680 20,790 Deferred
income taxes, net
32,058 29,031 46,088 49,827 53,686 Other
assets (1)
264,295 259,515 201,024
185,805 185,100 Total assets
$
8,318,359 $ 8,311,744 $ 8,269,398 $
8,107,646 $ 8,215,120
Liabilities: Deposits
$ 6,584,322 $ 6,510,246 $ 6,262,347 $ 6,381,339 $
6,246,620 Securities sold under agreements to repurchase
85,257 32,169 59,903 29,232 67,249 Federal funds purchased
— 30,000 70,000 40,000 — Federal Home Loan Bank borrowings
611,588 693,681 812,773 618,989 885,445 Junior subordinated
debentures
106,363 106,363 106,363 106,363 106,363 Other
liabilities (1)
125,004 135,880 127,069
115,088 110,310 Total liabilities
7,512,534
7,508,339 7,438,455 7,291,011 7,415,987
Redeemable noncontrolling interests (“RNCI”)
16,322 17,461 15,882 17,216 17,232
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
84,194
84,208 84,082 84,015 84,134 Additional paid-in capital
612,526 607,929 606,802 602,507 602,748 Retained earnings
61,518 49,526 76,455 66,807 53,510 Accumulated other
comprehensive income/ (loss)
(21,313 ) (8,658 )
(4,823 ) (6,038 ) (10,237 ) Total Company’s shareholders’ equity
784,678 780,758 810,269 795,044
777,908 Noncontrolling interests
4,825 5,186
4,792 4,375 3,993 Total shareholders’
equity
789,503 785,944 815,061 799,419
781,901 Total liabilities, redeemable noncontrolling
interests and shareholders’ equity
$ 8,318,359
$ 8,311,744 $ 8,269,398 $ 8,107,646 $
8,215,120
Boston Private Financial Holdings,
Inc.
Selected Financial Data
(Unaudited)
Three Months Ended March 31,
2018 December 31, 2017
September 30, 2017 June 30, 2017
March 31, 2017 Interest and dividend
income: (In thousands, except share and per share data)
Loans
$ 60,929 $ 59,496 $ 58,096 $ 57,736 $ 53,636
Taxable investment securities
1,510 1,562 1,569 1,592 1,670
Non-taxable investment securities
1,730 1,697 1,664 1,655
1,606 Mortgage-backed securities
3,178 3,125 3,267 3,495
3,504 Federal funds sold and other
1,009 978
916 831 600 Total interest and dividend income
68,356 66,858 65,512 65,309
61,016
Interest expense: Deposits
6,524 6,048
5,356 4,949 4,531 Federal Home Loan Bank borrowings
3,344
2,626 2,657 2,489 2,111 Junior subordinated debentures
846
771 761 716 671 Repurchase agreements and other short-term
borrowings
259 141 111 10 61
Total interest expense
10,973 9,586
8,885 8,164 7,374 Net interest income
57,383 57,272 56,627 57,145 53,642 Provision/ (credit) for
loan losses
(1,795 ) (942 ) (432 ) (6,114 ) (181 )
Net interest income after provision/ (credit) for loan losses
59,178 58,214 57,059 63,259
53,823
Fees and other income: Investment management
fees
11,425 12,321 11,274 11,081 10,839 Wealth advisory fees
13,512 13,496 13,279 12,961 12,823 Wealth management and
trust fees
12,151 11,756 11,619 11,161 10,826 Other banking
fee income
2,273 2,531 2,726 1,964 1,694 Gain on sale of
loans, net
74 85 169 59 138
Total core fees and income
39,435 40,189
39,067 37,226 36,320 Gain/ (loss) on
sale of investments, net
(24 ) (110 ) 230 237 19
Gain/ (loss) on OREO, net
— — — — (46 ) Gain/ (loss) on sale
of affiliates or offices
— (1,264 ) — — — Other
332
360 970 555 213 Total other
income
308 (1,014 ) 1,200 792 186
Total revenue (2) 97,126 96,447 96,894 95,163
90,148
Operating expense: Salaries and employee benefits
47,219 43,920 45,168 43,493 45,825 Occupancy and equipment
7,748 7,753 7,944 7,283 7,185 Professional services
3,177 4,035 3,308 3,106 3,314 Marketing and business
development
1,593 1,919 2,216 1,971 1,660 Information
systems
5,886 5,635 5,282 5,500 5,379 Amortization of
intangibles
750 1,323 1,426 1,426 1,426 Impairment of
goodwill
— 24,901 — — — FDIC insurance
744 677 647
879 766 Other
3,740 3,826 3,355 4,163
3,225 Total operating expense
70,857
93,989 69,346 67,821 68,780 Income
before income taxes
28,064 3,400 27,980 33,456 21,549 Income
tax expense
6,026 21,391 8,289 9,963
6,553 Net income/ (loss) from continuing operations
22,038 (17,991 ) 19,691 23,493 14,996 Net income from
discontinued operations (3)
1,698 989 1,186
1,063 1,632 Net income/ (loss) before
attribution to noncontrolling interests
23,736 (17,002 )
20,877 24,556 16,628 Less: Net income attributable to
noncontrolling interests
1,050 1,278 1,074
1,150 966
Net income/ (loss) attributable
to the Company $ 22,686 $ (18,280 ) $
19,803 $ 23,406 $ 15,662
Boston Private Financial Holdings,
Inc.
Selected Financial Data
(Unaudited)
Three Months Ended PER SHARE DATA:
March 31, 2018 December 31, 2017
September 30, 2017 June 30,
2017 March 31, 2017 (In thousands,
except share and per share data) Calculation of income for
EPS: Net income/ (loss) attributable to the Company
$
22,686 $ (18,280 ) $ 19,803 $ 23,406 $ 15,662 Adjustments to
Net income/ (loss) attributable to the Company to arrive at Net
income/ (loss) attributable to common shareholders, treasury stock
method (4)
(23 ) (1,998 ) (1,146 ) (577 ) (1,166 )
Net income/ (loss) attributable to the common shareholders,
treasury stock method $ 22,663 $ (20,278 )
$ 18,657 $ 22,829 $ 14,496
End of
period common shares outstanding 84,194,267 84,208,538
84,082,250 84,015,141 84,134,104
Weighted average shares
outstanding: Weighted average basic shares outstanding
83,097,758 82,904,776 82,556,225 82,298,493 81,951,179
Weighted average diluted shares outstanding (5)
85,271,650
82,904,776 84,888,311 84,741,680 84,560,918
Diluted total
earnings/ (loss) per share $ 0.27 $ (0.24 ) $
0.22 $ 0.27 $ 0.17
Boston Private Financial Holdings,
Inc.
Selected Financial Data
(Unaudited)
(In thousands, except per share data)
March 31, 2018
December 31, 2017 September 30,
2017 June 30, 2017 March
31, 2017 FINANCIAL DATA: Book value per common
share
$ 8.81 $ 8.77 $ 9.13 $ 8.95 $ 8.73 Tangible
book value per share (6)
$ 7.17 $ 7.12 $ 7.16 $ 6.97
$ 6.73 Market price per share
$ 15.05 $ 15.45 $ 16.55
$ 15.35 $ 16.40
ASSETS UNDER MANAGEMENT AND ADVISORY:
Wealth Management and Trust
$ 7,831,000 $ 7,865,000 $
7,703,000 $ 7,429,000 $ 7,260,000 Investment Managers (7)
1,920,000 2,004,000 1,902,000 1,829,000 1,849,000 Wealth
Advisory
11,446,000 11,350,000 10,992,000 10,744,000
10,579,000 Less: Inter-company Relationship
(11,000 )
(11,000 ) (11,000 ) (11,000 ) (11,000 ) Total Assets Under
Management and Advisory, excluding Anchor (7)
$
21,186,000 $ 21,208,000 $ 20,586,000 $
19,991,000 $ 19,677,000 Assets under management and
advisory at Anchor
9,042,000 9,277,000
9,181,000 9,072,000 9,058,000 Total assets
under management and advisory, including Anchor
$
30,228,000 $ 30,485,000 $ 29,767,000 $
29,063,000 $ 28,735,000
FINANCIAL
RATIOS: Total equity/ Total assets
9.49 % 9.46 %
9.86 % 9.86 % 9.52 % Tangible common equity/ Tangible assets (6)
7.38 % 7.33 % 7.43 % 7.37 % 7.04 % Tier 1 common
equity/ Risk weighted assets (6)
10.39 % 10.32 %
10.42 % 10.28 % 9.97 % Allowance for loan losses/ Total loans
1.10 % 1.15 % 1.17 % 1.19 % 1.25 % Allowance for loan
losses/ Nonaccrual loans
445 % 523 % 550 % 464 % 373
% Return on average assets - three months ended (annualized)
1.11 % (0.88 )% 0.96 % 1.15 % 0.79 % Return on
average common equity - three months ended (annualized) (8)
12.02 % (9.92 )% 9.87 % 12.12 % 8.26 % Return on
average tangible common equity - three months ended (annualized)
(8)
15.20 % (11.94 )% 13.24 % 16.27 % 11.43 %
Efficiency ratio - three months ended (9)
71.46 %
68.23 % 68.06 % 67.69 % 72.45 %
DEPOSIT DETAIL:
Demand deposits (noninterest-bearing)
$ 1,932,732 $
2,025,690 $ 1,850,833 $ 1,935,622 $ 1,772,854 NOW
689,526
645,361 636,013 631,973 620,280 Savings
73,580 70,935 74,333
69,892 74,293 Money market
3,177,692 3,121,811 3,009,779
3,055,642 3,176,472 Certificates of deposit
710,792
646,449 691,389 688,210 602,721 Total
deposits
$ 6,584,322 $ 6,510,246 $
6,262,347 $ 6,381,339 $ 6,246,620
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: 03/31/18
12/31/17 03/31/17 03/31/18
12/31/17 03/31/17 03/31/18
12/31/17 03/31/17 AVERAGE ASSETS
Interest-earning assets: Cash
and investments: Taxable investment securities
$
333,253 $ 345,743 $ 395,728
$ 1,510 $ 1,562 $
1,670
1.81 % 1.81 % 1.69 % Non-taxable investment
securities (10)
296,958 298,851 295,015
2,190 2,611
2,471
2.95 % 3.50 % 3.35 % Mortgage-backed securities
588,461 608,508 672,683
3,178 3,125 3,504
2.16
% 2.05 % 2.08 % Federal funds sold and other
161,573
172,656 160,001
1,009 978
600
2.51 % 2.23 % 1.51 % Total
cash and investments
1,380,245 1,425,758
1,523,427
7,887 8,276 8,245
2.29 % 2.32 % 2.17 % Loans (11):
Commercial and industrial (10)
933,209 962,159 983,697
8,756 9,603 9,303
3.75 % 3.91 % 3.78 %
Commercial real estate (10)
2,441,215 2,369,526 2,324,367
26,341 26,473 23,544
4.32 % 4.37 % 4.05 %
Construction and land (10)
169,384 131,107 113,963
1,965 1,568 1,244
4.64 % 4.68 % 4.36 %
Residential
2,702,317 2,650,014 2,424,772
21,766
21,248 18,991
3.22 % 3.21 % 3.13 % Home equity
97,191 105,044 117,702
1,042 1,074 1,089
4.35
% 4.06 % 3.75 % Other consumer
185,596 177,951
192,136
1,573 1,489 1,420
3.44 % 3.32 % 3.00 % Total loans
6,528,912 6,395,801 6,156,637
61,443 61,455 55,591
3.77
% 3.79 % 3.61 % Total earning assets
7,909,157 7,821,559 7,680,064
69,330 69,731 63,836
3.51
% 3.52 % 3.33 % LESS: Allowance for loan
losses
74,834 75,608 78,122 Cash and due from banks
(non-interest bearing)
51,944 43,648 41,469 Other assets
425,617 452,744 398,751
TOTAL
AVERAGE ASSETS $ 8,311,884 $ 8,242,343
$ 8,042,162
AVERAGE LIABILITIES, RNCI, AND
SHAREHOLDERS’ EQUITY Interest-bearing liabilities:
Interest-bearing deposits (11): Savings and NOW
$
716,930 $ 687,172 $ 652,038
$ 215 $ 148 $ 128
0.12 % 0.09 % 0.08 % Money market
3,141,564
3,177,687 3,213,092
4,314 3,998 3,122
0.56 %
0.50 % 0.39 % Certificates of deposit
657,109 685,136
589,900
1,995 1,902 1,281
1.23 % 1.10 % 0.88 % Total
interest-bearing deposits (12)
4,515,603 4,549,995 4,455,030
6,524 6,048 4,531
0.59 % 0.53 % 0.41 % Junior
subordinated debentures
106,363 106,363 106,363
846
771 671
3.18 % 2.84 % 2.52 % FHLB borrowings and
other
878,093 728,374 726,978
3,603 2,767 2,172
1.64 %
1.49 % 1.19 % Total interest-bearing liabilities
5,500,059 5,384,732 5,288,371
10,973 9,586 7,374
0.80 %
0.70 % 0.56 %
Non-interest bearing demand deposits (11)
(12)
1,872,472 1,894,924 1,843,830 Payables and other liabilities
133,243 128,075 117,132 Total average
liabilities
7,505,774 7,407,731 7,249,333 Redeemable
noncontrolling interests
22,085 21,094 18,578 Average
shareholders’ equity
784,025 813,518 774,251
TOTAL AVERAGE LIABILITIES, RNCI, AND SHAREHOLDERS’
EQUITY $ 8,311,884 $ 8,242,343 $
8,042,162 Net interest income - on a fully taxable
equivalent basis (FTE)
$ 58,357 $ 60,145 $ 56,462
LESS: FTE adjustment (10)
974 2,873 2,820
Net interest income (GAAP basis)
$ 57,383
$ 57,272 $ 53,642 Interest rate spread
2.71 % 2.82 % 2.77 % Bank only net interest margin
3.00 % 3.08 % 2.98 % Net interest margin
2.95
% 3.04 % 2.94 %
Boston Private Financial Holdings,
Inc.
Selected Financial Data
(Unaudited)
(In thousands)
March 31, 2018
December 31, 2017
September 30, 2017 June 30, 2017
March 31, 2017 LOAN DATA (13): Other
commercial and industrial loans: New England
$
444,419 $ 438,322 $ 503,322 $ 429,598 $ 458,687 San
Francisco Bay Area
23,491 23,311 50,686 49,163 55,289
Southern California
63,183 59,359
64,248 62,995 66,378 Total other
commercial and industrial loans
$ 531,093 $
520,992 $ 618,256 $ 541,756 $ 580,354
Commercial tax-exempt loans:
New England
$ 313,955 $ 305,792 $ 320,172 $ 312,783 $
318,137 San Francisco Bay Area
95,380 101,340 99,540 91,666
79,517 Southern California
11,422 11,566
11,638 11,708 11,778
Total commercial tax-exempt loans
$ 420,757 $
418,698 $ 431,350 $ 416,157 $ 409,432 Total
commercial and industrial loans
$ 951,850
$
939,690
$
1,049,606
$
957,913
$
989,786
Commercial real estate loans: New England
$ 1,046,178
$ 1,002,092 $ 988,788 $ 993,426 $ 1,017,565 San Francisco Bay Area
721,871 725,454 698,148 688,751 686,019 Southern California
696,954 712,674 676,223
674,168 665,043 Total commercial real estate
loans
$ 2,465,003 $ 2,440,220 $
2,363,159 $ 2,356,345 $ 2,368,627 Construction and
land loans: New England
$ 79,563 $ 86,874 $ 61,635 $
74,919 $ 58,737 San Francisco Bay Area
34,050 27,891 20,893
22,177 28,148 Southern California
51,627
50,225 35,763 33,808
30,122 Total construction and land loans
$ 165,240
$ 164,990 $ 118,291 $ 130,904 $ 117,007
Residential loans: New England
$ 1,619,856 $
1,598,072 $ 1,558,587 $ 1,540,393 $ 1,508,138 San Francisco Bay
Area
511,903 512,189 510,956 488,854 474,294 Southern
California
605,610 572,272
531,245 495,978 481,184 Total
residential loans
$ 2,737,369 $ 2,682,533
$ 2,600,788 $ 2,525,225 $ 2,463,616 Home
equity loans: New England
$ 65,434 $ 67,435 $ 72,149
$ 71,953 $ 80,904 San Francisco Bay Area
19,314 22,462
26,052 28,400 26,006 Southern California
9,583
10,061 9,026 8,196 7,626
Total home equity loans
$ 94,331 $ 99,958
$ 107,227 $ 108,549 $ 114,536 Other consumer
loans: New England
$ 166,413 $ 149,022 $ 150,309 $
175,644 $ 175,096 San Francisco Bay Area
13,569 14,707
15,302 17,909 17,163 Southern California
8,552
13,908 8,519 7,439 4,386
Total other consumer loans
$ 188,534 $ 177,637
$ 174,130 $ 200,992 $ 196,645 Total loans: New
England
$ 3,735,818 $ 3,647,609 $ 3,654,962 $
3,598,716 $ 3,617,264 San Francisco Bay Area
1,419,578
1,427,354 1,421,577 1,386,920 1,366,436 Southern California
1,446,931 1,430,065 1,336,662
1,294,292 1,266,517 Total loans
$ 6,602,327 $ 6,505,028 $ 6,413,201
$ 6,279,928 $ 6,250,217
Boston Private Financial Holdings,
Inc.
Selected Financial Data
(Unaudited)
(In thousands)
March 31, 2018
December 31, 2017 September 30,
2017 June 30, 2017 March
31, 2017 CREDIT QUALITY (13): Special mention
loans: New England
$ 33,282 $ 45,640 $ 37,569 $
34,538 $ 21,596 San Francisco Bay Area
14,117 23,400 23,898
23,399 23,850 Southern California
15,689 18,134
17,207 4,327 4,350 Total special mention loans
$ 63,088 $ 87,174 $ 78,674 $
62,264 $ 49,796 Accruing substandard loans (14): New England
$ 8,767 $ 10,911 $ 8,196 $ 10,185 $ 12,157 San
Francisco Bay Area
14,970 11,615 11,622 6,574 15,824
Southern California
21,436 30,826 33,923
34,339 36,398 Total accruing substandard loans
$ 45,173 $ 53,352 $ 53,741 $
51,098 $ 64,379 Nonaccruing loans: New England
$
8,056 $ 6,061 $ 7,380 $ 9,880 $ 14,407 San Francisco Bay
Area
1,442 1,473 1,494 1,857 2,312 Southern California
6,882 6,761 4,749 4,439 4,226
Total nonaccruing loans
$ 16,380 $ 14,295
$ 13,623 $ 16,176 $ 20,945 Loans 30-89 days
past due and accruing: New England
$ 10,571 $ 19,725
$ 4,664 $ 3,182 $ 9,843 San Francisco Bay Area
2,251 1,911
430 12 10,111 Southern California
7,554 3,412
198 — 8,771 Total loans 30-89 days past due and
accruing
$ 20,376 $ 25,048 $ 5,292
$ 3,194 $ 28,725 Loans (charged-off)/ recovered, net
for the three months ended: New England
$ (285
) $ 1,020 $ 73 $ 667 $ 79 San Francisco Bay Area
67
64 206 2,856 35 Southern California
169 (273 ) 17
(431 ) 21 Total net loans (charged-off)/ recovered
$
(49 ) $ 811 $ 296 $ 3,092 $ 135
Boston Private Financial Holdings,
Inc.Selected Financial Data(Unaudited)
FOOTNOTES:
(1) On December 20, 2017, Boston Private Financial Holdings,
Inc. (the “Company”) announced an agreement, effective December 19,
2017, to sell all of its current equity interest in Anchor Capital
Advisors LLC, an indirect, majority-owned subsidiary of the Company
(“Anchor”), to the management team of Anchor for an upfront cash
payment and a non-voting, revenue share participation interest in
Anchor. On April 13, 2018, the Company completed the sale of its
ownership interest in Anchor. Anchor’s results remain consolidated
in the Company’s results during current and prior periods. For
presentation purposes, Anchor’s AUM are excluded from current and
prior period AUM amounts, but are included in the calculation of
Core Fees and Income. The Company classified the assets and
liabilities of Anchor as held for sale at March 31, 2018 and
December 31, 2017, which are included with Other assets and Other
liabilities, respectively, on the Company’s consolidated balance
sheet. For regulatory purposes, the goodwill and intangible assets
of Anchor will be included in consolidated calculations. See
footnotes 6 and 8, below.
(2) Total revenue is the sum of Net interest income, Total core
fees and income, and Total other income.
(3) Net income from discontinued operations consists of
contingent payments net of expenses related to our divested
affiliate, Westfield Capital Management Company, LLC. The Company
received its final contingent payment in the first quarter of 2018
related to this affiliate.
(4) 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.
(5) 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, 2017 for additional information.
(6) 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 share and
per share data)
March 31, 2018 December 31,
2017 September 30, 2017 June 30,
2017 March 31, 2017 Total balance sheet assets
$ 8,318,359 $ 8,311,744 $ 8,269,398 $ 8,107,646 $
8,215,120 LESS: Goodwill and intangible assets, net *
(138,026 ) (138,775 ) (165,001 ) (166,427 ) (167,853
) Tangible assets (non-GAAP)
$ 8,180,333 $ 8,172,969
$ 8,104,397 $ 7,941,219 $ 8,047,267 Total shareholders’ equity
$ 789,503 $ 785,944 $ 815,061 $ 799,419 $ 781,901
LESS: Series D preferred stock (non-convertible)
(47,753
) (47,753 ) (47,753 ) (47,753 ) (47,753 ) LESS: Goodwill and
intangible assets, net *
(138,026 ) (138,775 )
(165,001 ) (166,427 ) (167,853 ) Total adjusting items
(185,779 ) (186,528 ) (212,754 ) (214,180 ) (215,606
) Tangible common equity (non-GAAP)
$ 603,724
$ 599,416 $ 602,307 $ 585,239 $ 566,295
Total equity/ Total assets
9.49 % 9.46 % 9.86 % 9.86
% 9.52 % Tangible common equity/ Tangible assets (non-GAAP)
7.38 % 7.33 % 7.43 % 7.37 % 7.04 % Total risk
weighted assets **
$ 5,974,862 $ 5,892,286 $
5,831,558 $ 5,765,471 $ 5,806,853 Tier 1 common equity **
$
621,084 $ 607,800 $ 607,822 $ 592,845 $ 578,941 Tier 1
common equity/ Risk weighted assets **
10.39 % 10.32
% 10.42 % 10.28 % 9.97 % End of period shares outstanding
84,194,267 84,208,538 84,082,250 84,015,141 84,134,104
Book value per common share
$ 8.81 $ 8.77 $
9.13 $ 8.95 $ 8.73 Tangible book value per share (non-GAAP)
$ 7.17 $ 7.12 $ 7.16 $ 6.97 $ 6.73
* Includes goodwill and intangible assets at affiliates held for
sale.** Risk weighted assets and Tier 1 common equity for March 31,
2018 are presented based on estimated data.
Boston Private Financial Holdings,
Inc.Selected Financial Data(Unaudited)
(7) Assets under management and advisory for all periods shown
have been reduced to exclude those assets managed or advised by
Anchor.
(8) 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)
March 31,
2018 December 31, 2017
September 30, 2017 June 30, 2017
March 31, 2017 Total average shareholders’
equity
$ 784,025 $ 813,518 $ 808,596 $ 793,526 $
774,251 LESS: Average Series D preferred stock (non-convertible)
(47,753 ) (47,753 ) (47,753 ) (47,753 ) (47,753 )
Average common equity (non-GAAP)
736,272 765,765
760,843 745,773 726,498 LESS: Average
goodwill and intangible assets, net *
(138,451 )
(157,978 ) (165,766 ) (167,204 ) (168,681 ) Average tangible common
equity (non-GAAP)
$ 597,821 $ 607,787 $
595,077 $ 578,569 $ 557,817 Net income/
(loss) attributable to the Company
$ 22,686 $ (18,280
) $ 19,803 $ 23,406 $ 15,662 LESS: Dividends on Series D preferred
stock
(869 ) (869 ) (868 ) (869 ) (869 ) Common net
income/ (loss) (non-GAAP)
21,817 (19,149 ) 18,935 22,537
14,793 ADD: Amortization of intangibles, net of tax (35% in 2017,
21% in 2018)
593 860 927 927 927
Tangible common net income/ (loss) (non-GAAP)
$
22,410 $ (18,289 ) $ 19,862 $ 23,464 $
15,720 Return on average equity - (annualized)
11.73 % (8.91 )% 9.72 % 11.83 % 8.20 % Return on
average common equity - (annualized) (non-GAAP)
12.02
% (9.92 )% 9.87 % 12.12 % 8.26 % Return on average tangible
common equity - (annualized) (non-GAAP)
15.20 %
(11.94 )% 13.24 % 16.27 % 11.43 %
* Includes goodwill and intangible assets at affiliates held for
sale.
(9) The Company uses certain non-GAAP financial measures, such
as: pre-tax, pre-provision income, 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
income; 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)
March 31,
2018 December 31, 2017
September 30, 2017 June 30, 2017
March 31, 2017 Income before income taxes
(GAAP)
$ 28,064 $ 3,400 $ 27,980 $ 33,456 $ 21,549
ADD BACK: Provision/ (credit) for loan losses
(1,795
) (942 ) (432 ) (6,114 ) (181 ) Pre-tax, pre-provision
income (non-GAAP)
$ 26,269 $ 2,458 $ 27,548 $ 27,342
$ 21,368 Total operating expense (GAAP)
$
70,857 $ 93,989 $ 69,346 $ 67,821 $ 68,780 Less:
Amortization of intangibles
750 1,323 1,426 1,426 1,426
Less: Goodwill impairment
— 24,901 — —
— Total operating expense (excluding amortization of
intangibles, and goodwill impairment) (non-GAAP)
$
70,107 $ 67,765 $ 67,920 $ 66,395 $ 67,354 Net
interest income
$ 57,383 $ 57,272 $ 56,627 $ 57,145 $
53,642 Total core fees and income
39,435 40,189 39,067
37,226 36,320 Total other income
308 (1,014 ) 1,200 792 186
FTE income
974 2,873 2,899 2,923
2,820 Total revenue (FTE basis)
$ 98,100 $
99,320 $ 99,793 $ 98,086 $ 92,968 Efficiency ratio (GAAP)
72.95 % 97.45 % 71.57 % 71.27 % 76.30 % Efficiency
ratio, FTE Basis excluding amortization of intangibles, and
goodwill impairment (non-GAAP)
71.46 % 68.23 % 68.06
% 67.69 % 72.45 %
(10) Interest income on Non-taxable investments and loans are
presented on an FTE basis using the federal statutory rate of 35%
in 2017 and 21% in 2018 for each respective period presented.
(11) Average loans includes Loans held for sale and Nonaccrual
loans.
(12) Average total deposits is the sum of Average total
interest-bearing deposits and Average non-interest bearing demand
deposits.
(13) The concentration of the Private Banking loan data and
credit quality is primarily based on the location of the lender’s
regional offices.
(14) 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.
(15) 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, also referred to as core
net interest margin, 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)
March 31,
2018 December 31, 2017
September 30, 2017 June 30, 2017
March 31, 2017 Net interest income (GAAP
basis)
$ 57,383 $ 57,272 $ 56,627 $ 57,145 $ 53,642
ADD: FTE income
974 2,873 2,899 2,923
2,820 Net interest income, FTE basis
58,357
60,145 59,526 60,068 56,462 LESS: Interest recovered on previously
nonaccrual loans
80 429 133 1,971
299
Net interest income, FTE basis, excluding
interest recovered on previously nonaccrual loans (non-GAAP) - also
referred to as Core net interest income, FTE basis (non-GAAP)
58,277 59,716 59,393 58,097
56,163 Net interest margin (FTE basis)
2.95
% 3.04 % 3.02 % 3.07 % 2.94 % Net interest margin, FTE
basis, excluding interest recovered on previously nonaccrual loans
(non-GAAP) - also referred to as Core net interest margin (FTE
basis)
2.94 % 3.02 % 3.02 % 2.97 % 2.92 %
Net interest margin, non-FTE basis,
excluding interest recovered on previously nonaccrual loans
(non-GAAP) - also referred to as Core net interest margin (non-FTE
basis) (non-GAAP)
2.90 % 2.87 % 2.87 % 2.82 % 2.78 %
Boston Private Financial Holdings,
Inc.Selected Financial Data(Unaudited)
(16) 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)
March 31, 2018 December
31, 2017 September 30, 2017
June 30, 2017 March 31, 2017 Net
income/ (loss) attributable to the Company (GAAP)
$
22,686 $ (18,280 ) $ 19,803 $ 23,406 $ 15,662 LESS: Gain/
(loss) on sale of affiliates or offices
— (1,264 ) — — —
ADD BACK: Anchor divestiture legal
expense
— 400 — — — ADD BACK: Impairment of goodwill
— 24,901
— — — ADD BACK: Tax adjustments
— 12,880 — — — Tax effect at
35% statutory rate *
—
(582 ) — — —
Net income attributable to the Company
excluding notable items (non-GAAP)
$ 22,686 $ 20,583 $ 19,803 $ 23,406 $ 15,662
Net income/ (loss) attributable to the
common shareholders, treasury stock method (GAAP)
$ 22,663 $ (20,278 ) $ 18,657 $ 22,829 $ 14,496 LESS:
Gain/ (loss) on sale of affiliates or offices
— (1,264 ) — —
—
ADD BACK: Anchor divestiture legal
expense
— 400 — — — ADD BACK: Impairment of goodwill
— 24,901
— — — ADD BACK: Tax adjustments
— 12,880 — — — Tax effect at
35% statutory rate *
— (582 ) — — —
Net income attributable to the common shareholders, treasury
stock method, excluding notable items (non-GAAP)
$
22,663 $ 18,585 $ 18,657 $ 22,829 $ 14,496
Weighted average diluted shares
outstanding (GAAP)
85,271,650
82,904,776
84,888,311
84,741,680
84,560,918
Weighted average diluted shares
outstanding, excluding notable items (non-GAAP) **
85,271,650 85,196,760 84,888,311 84,741,680 84,560,918
Diluted total earnings/ (loss) per share (GAAP)
$
0.27 $ (0.24 ) $ 0.22 $ 0.27 $ 0.17 Diluted total earnings
per share, excluding notable items (non-GAAP)
$ 0.27
$ 0.22 $ 0.22 $ 0.27 $ 0.17 Average common equity (non-GAAP)
$ 736,272 $ 765,765 $ 760,843 $ 745,773 $ 726,498
Average tangible common equity (non-GAAP)
$ 597,821 $
607,787 $ 595,077 $ 578,569 $ 557,817 Return on average common
equity - (annualized), excluding notable items (non-GAAP)
12.02 % 10.21 % 9.87 % 12.12 % 8.26 % Return on
average tangible common equity - (annualized), excluding notable
items (non-GAAP)
15.20 % 13.43 % 13.24 % 16.27 %
11.43 %
Pre-tax, pre-provision income
(non-GAAP)
$
26,269
$
2,458
$
27,548
$
27,342
$
21,368
LESS: Gain/ (loss) on sale of affiliates
or offices
—
(1,264
)
—
—
—
ADD BACK: Anchor divestiture legal
expense
—
400
—
—
—
ADD BACK: Impairment of goodwill
—
24,901
—
—
—
Pre-tax, pre-provision income, excluding notable items
(non-GAAP)
$
26,269
$ 29,023 $ 27,548 $ 27,342 $ 21,368
* Due to the nature of the goodwill related to Anchor, no tax
effect is applied to the goodwill impairment in the fourth quarter
of 2017.** For the fourth quarter of 2017, weighted average diluted
shares outstanding include the dilutive effects when the excluded
notable items move net income/ (loss) attributable to the common
shareholders from a net loss to a net income position.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20180418006417/en/
Boston Private Financial Holdings, Inc.Adam Bromley(617)
912-4386abromley@bostonprivate.com
Boston Private Financial (NASDAQ:BPFH)
Historical Stock Chart
From Aug 2024 to Sep 2024
Boston Private Financial (NASDAQ:BPFH)
Historical Stock Chart
From Sep 2023 to Sep 2024