CAMDEN, Maine, July 26, 2016 /PRNewswire/ -- Camden
National Corporation (NASDAQ: CAC; "Camden National" or the
"Company"), a $3.9 billion bank
holding company headquartered in Camden,
Maine, reported net income for the second quarter of 2016 of
$9.6 million and diluted earnings per
shares ("EPS") of $0.92 per share,
representing an increase over the first quarter of 2016 of 11% and
10%, respectively. Total revenues1 for the second
quarter of 2016 reached $39.1
million, representing a 9% increase over prior quarter, and
operating expenses were $22.3
million, a decrease of 3% over prior quarter. For the second
quarter of 2016, the Company's return on average assets was 1.01%,
return on tangible equity was 14.50%, and efficiency
ratio2 was 56.53%.
"We continue to see positive momentum across the organization
with total assets reaching $3.9
billion at June 30, 2016 and
strong operating results for the second quarter, highlighting the
successes and accomplishments over the past nine months as we
continue to leverage the benefits of The Bank of Maine merger and implement several strategic
initiatives," said Gregory A.
Dufour, president and chief executive officer of Camden
National. "We had solid net income growth of 11% for the second
quarter of 2016 over last quarter, driven by strong loan growth and
higher fee income, as well as lower operating costs."
Dufour added, "We continuously assess all aspects of our
business to ensure we are making the right strategic decisions for
the longevity of the Company, and in doing so, we will close two
banking centers located in Bangor
and Orono, Maine."
Subject to the regulatory notice periods, the Company
anticipates that the Bangor and
Orono, Maine banking centers will
close in the fourth quarter of 2016. Affected customers will not
need to take any action, and there will be no interruption of
service. All employees from the closing locations will be
provided other opportunities through open positions within the
Company.
Dufour continued, "We weigh the opening and closing of banking
centers very heavily and our decision was based on many factors,
including local economic conditions, financial considerations and
the impact to our customers, who will continue to be served by
existing banking centers located less than five miles from the
closed locations, as well as our extensive online and mobile
banking channels."
SECOND QUARTER 2016 FINANCIAL HIGHLIGHTS (compared to the
first quarter of 2016, unless otherwise stated)
- Net income reached $9.6 million,
representing a $970,000, or 11%,
increase over last quarter.
- Diluted EPS reached $0.92 per
share, representing a $0.08 per
share, or 10%, increase over last quarter.
- The return on average assets was 1.01% compared to 0.93% last
quarter.
- The return on average tangible equity was 14.50% compared to
13.56% last quarter.
- The efficiency ratio for the second quarter of 2016 improved to
56.53% compared to 61.18% last quarter as the Company implemented
all of its planned synergies and cost saving strategies from its
acquisition of SBM Financial, Inc. ("SBM"), the parent company of
The Bank of Maine, in October 2015.
- Tangible book value per share2 increased 8% to
$27.47 per share since year-end.
- Annualized loan growth through the first half of 2016 was 9%,
while annualized core deposits growth for the same period was
6%.
- The provision for credit losses was $2.9
million, representing a $2.0
million increase over last quarter, primarily due to the
deterioration of two commercial loans. Overall asset quality
remains strong with lower net charge-offs and 30-89 days past due
loans compared to last quarter.
_____________________________________________________________________________________________
1 Revenue is defined as the sum of net interest
income and non-interest income.
2 This is a non-GAAP measure. Please refer to
"Reconciliation of non-GAAP to GAAP Financial Measures" for further
details.
FINANCIAL CONDITION
Total assets at June 30, 2016 were
$3.9 billion compared to $3.7 billion at December
31, 2015, representing an increase of $201.0 million, or 11% annualized. Our asset
growth for the first half of 2016 was driven by strong loan growth
of $107.1 million, a $66.0 million increase in our investment
portfolio, and a $16.7 million
investment in bank-owned life insurance.
Loan growth (excluding loans held for sale) of $95.1 million was driven by our commercial loan
portfolio, which increased $121.9
million since year-end, partially offset by a decrease
within our retail loan portfolio of $26.8
million since year-end. We experienced strong positive
momentum throughout the first half of 2016 within our commercial
real estate loan portfolio, which made up 74% of our commercial
loan growth through the first six months of 2016. We continue to
see commercial borrowers looking to lock in long-term fixed rate
borrowings at today's low interest rates, and we continue to
utilize our commercial loan swap program to achieve this for our
commercial customers, while simultaneously improving our interest
rate sensitivity. At June 30, 2016,
the Company had $232.3 million of
back-to-back loans swaps with its commercial customers and dealer
banks, compared to $142.9 million at
December 31, 2015. The decrease in
our retail loan portfolio since year-end was primarily driven by a
decrease in residential mortgage loans of $20.1 million. The Company has sold approximately
70% of its originated residential mortgages through the first six
months of 2016 to generate fee income and enhance its interest rate
sensitivity. For the six months ended June
30, 2016, the Company sold $95.2
million of residential mortgage loans compared to
$12.5 million for the same period a
year ago.
Total deposits at June 30, 2016
were $2.8 billion, representing an
increase of $47.1 million since
year-end. Core deposits (demand, interest checking, savings and
money market) at June 30, 2016
totaled $2.1 billion, representing an
increase of $63.5 million since
year-end. Total borrowings at June 30,
2016 increased $118.1 million
to $690.5 million.
The Company and its wholly-owned subsidiary Camden National Bank, continue to maintain
risk-based capital ratios in excess of the regulatory levels
required for an institution to be considered "well capitalized." At
June 30, 2016, the Company's total
risk-based capital ratio, Tier I risk-based capital ratio, common
equity Tier I risk-based capital ratio, and Tier I leverage capital
ratio were 12.94%, 11.51%, 10.25%, and 8.44%, respectively.
FINANCIAL OPERATING RESULTS
SECOND QUARTER 2016 COMPARED TO FIRST QUARTER
2016:
Net income for the second quarter of 2016 was $9.6 million, representing an increase of
$970,000, or 11%, over the prior
quarter. Diluted EPS for the second quarter of 2016 was
$0.92 per share compared to
$0.84 per share last quarter.
Core operating earnings2 for the second quarter of
2016 was $9.7 million, representing
an increase over last quarter of $666,000, or 7%. Core diluted EPS2 for
the second quarter of 2016 increased $0.05 per share to $0.93 per share over last quarter. Our core
return on average assets2 and tangible
equity2 for the second quarter was 1.02% and 14.67%,
respectively, compared to 0.97% and 14.19% last quarter.
Revenues increased $3.2 million,
or 9%, for the second quarter of 2016 to $39.1 million compared to last quarter. The
increase in revenues was driven by a $2.6
million increase in non-interest income and a $552,000 increase in net interest income.
- Net interest income of $28.5
million increased 2% due to:
- Average interest-earning assets for the second quarter of 2016
grew $75.1 million, or 2%, compared
to last quarter, driven by higher average loan balances of
$54.2 million and higher average
investment balances of $20.9
million.
- Net interest margin decreased one basis point to 3.34% in the
second quarter of 2016 compared to last quarter. Excluding the
impact of the fair value mark accretion from purchase accounting
and collection of previously charged-off acquired loans, our
normalized net interest margin(2) was 3.09%, compared to
3.14% last quarter. The decrease in our normalized margin was
driven by a higher loan mix of variable rate commercial loans as we
continue to see growth within this portfolio and utilize commercial
loan swaps.
- Non-interest income of $10.6
million increased 33% due to:
- An increase in fee income generated from our commercial
back-to-back loan swap program of $937,000. Total fees generated in the second
quarter of 2016 were $1.2 million on
$73.1 million of back-to-back loan
swap agreements.
- An increase in mortgage banking income of $898,000 primarily due to an increase in mortgage
gains of $528,000 as a result of
higher loan sale volume in the second quarter of 2016 of
$17.4 million. Additionally, mortgage
servicing rights ("MSR") costs from amortization and valuation
adjustments were $280,000 lower in
the second quarter of 2016 compared to last quarter primarily as
the valuation adjustment of our MSRs largely occurred last quarter
with the sharp fall in U.S. Treasury rates.
- An increase in bank-owned life insurance income of $470,000 primarily due to death benefits of
$394,000 received on an insured.
Non-interest expenses for the second quarter of 2016 totaled
$22.3 million, representing a
decrease of $579,000 compared to last
quarter. Our efficiency ratio for the second quarter of 2016 was
56.53% compared to 61.18% last quarter. The decrease in
non-interest expenses was driven by:
- Lower merger and acquisition expenses of $467,000 as non-recurring costs associated with
the SBM acquisition in October 2015
wind-down.
- Lower other real estate owned ("OREO") and collection costs of
$160,000 primarily due to the sale of
three OREO properties resulting in gains of $218,000, whereas last quarter a loss of
$66,000 was recognized on the sale of
an OREO property. Partially offsetting the gains on sale in the
second quarter were higher costs associated with collections and
foreclosure activity of $123,000.
- Lower operating costs, including marketing costs of
$166,000, check and debit card fraud
losses of $66,000, and other
expenses.
- Partially offset by higher compensation and employee benefit
costs of $408,000 due to timing of
merit increases and an increase in incentive compensation based on
year-to-date performance.
In the second quarter of 2016, the Company adopted Accounting
Standards Update 2016-09, Compensation - Stock Compensation
(Topic 718): Improvements to Employee Share-Based Payment
Accounting ("ASU 2016-09"). The standard was adopted effective
as of the beginning of 2016 and, thus, the first quarter 2016
financial information was revised to present such accordingly.
The Company's effective tax rate for the second quarter of 2016
was 30.7% compared to 28.5% last quarter, reflecting the discrete
period impact of windfall tax benefits recognized within the first
and second quarter of 2016 of $299,000 and $65,000, respectively, upon adoption of ASU
2016-09.
SIX MONTHS ENDED JUNE 30,
2016 COMPARED TO SIX MONTHS ENDED JUNE 30, 2015:
Net income for the six months ended June
30, 2016 was $18.3 million
compared to $12.8 million for the
same period in 2015, representing an increase of $5.5 million, or 43%. Diluted EPS for the six
months ended June 30, 2016 was
$1.76 per share compared to
$1.71 per share for the same period
in 2015, representing an increase of $0.05 per share, or 3%. The increase in net
income and diluted EPS for the six months ended June 30, 2016 over the same period a year ago
highlights the benefits of the SBM acquisition completed in
October 2015.
Our return on average assets and average tangible equity for the
six months ended June 30, 2016 was
0.97% and 14.04%, respectively, compared to 0.92% and 13.08% for
the six months ended June 30, 2015.
Our efficiency ratio for the six months ended June 30, 2016 was 58.77% compared to 60.24% for
the same period a year ago.
Core operating earnings for the six months ended
June 30, 2016 was $18.8 million, representing an increase over the
same period last year of $5.2
million, or 38%. Core diluted EPS for the six months
ended June 30, 2016 and 2015 was
$1.81 per share. Our core return on
average assets and tangible equity for the six months ended
June 30, 2016 was 1.00% and 14.44%,
respectively, compared to 0.98% and 13.84% for the same period last
year.
ASSET QUALITY
The provision for credit losses was $2.9
million for the second quarter of 2016, representing an
increase of $2.0 million over last
quarter. The increase was a combination of seasonality, growth in
the commercial portfolio and deterioration of one commercial real
estate and one commercial credit accounting for $2.3 million of the second quarter provision for
credit losses. Aside from these two loans, which we view as
borrower specific, we saw positive momentum across our portfolio
through loan credit rating upgrades. For the second quarter,
annualized quarter-to-date net charge-offs to average loans were
0.07%, representing a decrease of 0.04% from last quarter.
Non-performing loans at June 30,
2016 increased $8.4 million
since March 31, 2016 as the
commercial real estate loan noted above totaling $11.7 million was placed on non-performing status
in the second quarter of 2016. At June 30,
2016, our ratio of non-performing loans to total loans was
1.10%, representing an increase of 0.30% since March 31, 2016 and 0.17% since year-end, while
our ratio of loans 30-89 days past due to total loans was 0.27%,
representing a decrease of 0.03% since March
31, 2016 and 0.13% since year-end.
SECOND QUARTER 2016 DIVIDEND
The board of directors approved a dividend of $0.30 per share, payable on July 29, 2016, to shareholders of record as of
July 15, 2016. This distribution
represents an annualized dividend yield of 2.86%, based on the
June 30, 2016 closing price of Camden
National's common stock at $42.00 per
share as reported by NASDAQ.
CONFERENCE CALL
Camden National will host a conference call and webcast at
3:30 p.m. eastern time on
July 26, 2016 to discuss our second
quarter 2016 financial results and outlook. Participants should
dial in to the call 10 - 15 minutes before it begins. Information
about the conference call is as follows:
Live dial-in
(domestic):
|
(888)
349-0139
|
Live dial-in
(international):
|
(412)
542-4154
|
Live
webcast:
|
http://services.choruscall.com/links/cac160726
|
A link to the live webcast will be will be available on Camden
National's website under "Investor Relations" at
www.CamdenNational.com prior to the meeting. The transcript of
the conference call will also be available on Camden National's
website approximately two days after the conference call.
ABOUT CAMDEN NATIONAL CORPORATION
Camden National Corporation is the holding company of
Camden National Bank and Acadia
Trust, N.A. Headquartered in Camden,
Maine, Camden National Corporation has $3.9 billion in assets and is the largest
publicly traded bank holding company in Northern New England
(NASDAQ: CAC). Camden National Bank
is a full-service community bank that employs over 650 people,
features a network of 63 banking centers and 85 ATMs in
Maine, and offers state-of-the-art
online and mobile banking resources as well as investment,
insurance and financial planning services through its division,
Camden Financial Consultants. With offices in Portland, Bangor, and Ellsworth, Acadia Trust, N.A. provides
comprehensive wealth management, investment management and trust
services to individual and institutional clients throughout
Maine and New England. To learn
more, visit www.CamdenNational.com.
FORWARD-LOOKING STATEMENTS
Certain statements contained in this press release that are not
statements of historical fact constitute forward-looking statements
within the meaning of the Private Securities Litigation Reform Act
of 1995, including certain plans, expectations, goals, projections
and other statements, which are subject to numerous risks,
assumptions and uncertainties. Forward-looking statements can be
identified by the fact that they do not relate strictly to
historical or current facts. They often include words like
"believe," "expect," "anticipate," "estimate," and "intend" or
future or conditional verbs such as "will," "would," "should,"
"could" or "may." Certain factors that could cause actual results
to differ materially from expected results include difficulties in
achieving cost savings in connection with the recent acquisition of
SBM or in achieving such cost savings within the expected time
frame, increased competitive pressures, changes in the interest
rate environment, changes in general economic conditions,
legislative and regulatory changes that adversely affect the
business in which Camden National is engaged, changes in the
securities markets and other risks and uncertainties disclosed from
time to time in in Camden National's Annual Report on Form 10-K for
the year ended December 31, 2015, as
updated by other filings with the Securities and Exchange
Commission ("SEC"). Camden National does not have any obligation to
update forward-looking statements.
USE OF NON-GAAP MEASURES
In addition to evaluating the Company's results of operations in
accordance with GAAP, management supplements this evaluation with
certain non-GAAP financial measures, such as the efficiency, core
operating expenses to total average assets, tangible common equity,
and core return ratios; core operating earnings; core diluted EPS;
core operating expenses; normalized net interest margin; tangible
book value per share; and tax-equivalent net interest income.
Management believes these non-GAAP financial measures help
investors in understanding the Company's operating performance and
trends and allow for better performance comparisons to other banks.
In addition, these non-GAAP financial measures remove the impact of
unusual items that may obscure trends in the Company's underlying
performance. These disclosures should not be viewed as a substitute
for GAAP operating results, nor are they necessarily comparable to
non-GAAP performance measures that may be presented by other
financial institutions. Reconciliation to the comparable GAAP
financial measure can be found in this document.
ANNUALIZED DATA
Certain returns, yields and performance ratios are presented on
an "annualized" basis. This is done for analytical and
decision-making purposes to better discern underlying performance
trends when compared to full-year or year-over-year amounts.
Selected Financial
Data (unaudited)
|
|
|
At or For
The
Three Months
Ended
|
|
At or For The
Six Months Ended
|
(In thousands,
except number of shares and per share data)
|
|
June 30,
2016
|
|
March 31,
2016(2)
|
|
June 30,
2015
|
|
June 30,
2016
|
|
June 30,
2015
|
Financial
Condition Data
|
|
|
|
|
|
|
|
|
|
|
Investments
|
|
$
|
921,989
|
|
|
$
|
909,584
|
|
|
$
|
822,991
|
|
|
$
|
921,989
|
|
|
$
|
822,991
|
|
Loans and loans held
for sale
|
|
2,608,228
|
|
|
2,509,266
|
|
|
1,808,433
|
|
|
2,608,228
|
|
|
1,808,433
|
|
Allowance for loan
losses
|
|
(23,717)
|
|
|
(21,339)
|
|
|
(21,194)
|
|
|
(23,717)
|
|
|
(21,194)
|
|
Total
assets
|
|
3,910,386
|
|
|
3,762,540
|
|
|
2,837,921
|
|
|
3,910,386
|
|
|
2,837,921
|
|
Deposits
|
|
2,773,487
|
|
|
2,674,832
|
|
|
1,981,131
|
|
|
2,773,487
|
|
|
1,981,131
|
|
Borrowings
|
|
690,476
|
|
|
659,111
|
|
|
564,097
|
|
|
690,476
|
|
|
564,097
|
|
Shareholders'
equity
|
|
384,856
|
|
|
375,458
|
|
|
254,540
|
|
|
384,856
|
|
|
254,540
|
|
Operating
Data
|
|
|
|
|
|
|
|
|
|
|
Net interest
income
|
|
$
|
28,504
|
|
|
$
|
27,952
|
|
|
$
|
20,635
|
|
|
$
|
56,456
|
|
|
$
|
40,069
|
|
Provision for credit
losses
|
|
2,852
|
|
|
872
|
|
|
254
|
|
|
3,724
|
|
|
700
|
|
Non-interest
income
|
|
10,552
|
|
|
7,917
|
|
|
6,310
|
|
|
18,469
|
|
|
12,457
|
|
Non-interest
expense
|
|
22,330
|
|
|
22,909
|
|
|
16,157
|
|
|
45,239
|
|
|
32,958
|
|
Income before income
taxes
|
|
13,874
|
|
|
12,088
|
|
|
10,534
|
|
|
25,962
|
|
|
18,868
|
|
Income tax
expense
|
|
4,258
|
|
|
3,442
|
|
|
3,341
|
|
|
7,700
|
|
|
6,064
|
|
Net income
|
|
$
|
9,616
|
|
|
$
|
8,646
|
|
|
$
|
7,193
|
|
|
$
|
18,262
|
|
|
$
|
12,804
|
|
Core operating
earnings(1)
|
|
$
|
9,731
|
|
|
$
|
9,065
|
|
|
$
|
7,308
|
|
|
$
|
18,796
|
|
|
$
|
13,572
|
|
Key
Ratios
|
|
|
|
|
|
|
|
|
|
|
Return on average
assets
|
|
1.01
|
%
|
|
0.93
|
%
|
|
1.02
|
%
|
|
0.97
|
%
|
|
0.92
|
%
|
Core return on
average assets(1)
|
|
1.02
|
%
|
|
0.97
|
%
|
|
1.04
|
%
|
|
1.00
|
%
|
|
0.98
|
%
|
Return on average
equity
|
|
10.22
|
%
|
|
9.41
|
%
|
|
11.35
|
%
|
|
9.82
|
%
|
|
10.29
|
%
|
Core return on
average equity(1)
|
|
10.34
|
%
|
|
9.87
|
%
|
|
11.50
|
%
|
|
10.11
|
%
|
|
10.81
|
%
|
Return on average
tangible equity(1)
|
|
14.50
|
%
|
|
13.56
|
%
|
|
14.33
|
%
|
|
14.04
|
%
|
|
13.08
|
%
|
Core return on
average tangible equity(1)
|
|
14.67
|
%
|
|
14.19
|
%
|
|
14.56
|
%
|
|
14.44
|
%
|
|
13.84
|
%
|
Tangible common
equity ratio(1)
|
|
7.42
|
%
|
|
7.43
|
%
|
|
7.42
|
%
|
|
7.42
|
%
|
|
7.42
|
%
|
Efficiency
ratio(1)
|
|
56.53
|
%
|
|
61.18
|
%
|
|
58.60
|
%
|
|
58.77
|
%
|
|
60.24
|
%
|
Yield on average
interest-earning assets
|
|
3.83
|
%
|
|
3.83
|
%
|
|
3.67
|
%
|
|
3.83
|
%
|
|
3.61
|
%
|
Average cost of
funds
|
|
0.51
|
%
|
|
0.49
|
%
|
|
0.48
|
%
|
|
0.50
|
%
|
|
0.48
|
%
|
Net interest
margin
|
|
3.34
|
%
|
|
3.35
|
%
|
|
3.21
|
%
|
|
3.34
|
%
|
|
3.14
|
%
|
Non-performing loans
to total loans
|
|
1.10
|
%
|
|
0.80
|
%
|
|
0.89
|
%
|
|
1.10
|
%
|
|
0.89
|
%
|
Non-performing assets
to total assets
|
|
0.75
|
%
|
|
0.56
|
%
|
|
0.59
|
%
|
|
0.75
|
%
|
|
0.59
|
%
|
Annualized
charge-offs to average loans
|
|
0.07
|
%
|
|
0.11
|
%
|
|
0.07
|
%
|
|
0.09
|
%
|
|
0.07
|
%
|
Tier I leverage
capital ratio
|
|
8.44
|
%
|
|
8.42
|
%
|
|
9.39
|
%
|
|
8.44
|
%
|
|
9.39
|
%
|
Common equity tier I
risk-based capital ratio
|
|
10.25
|
%
|
|
10.37
|
%
|
|
11.40
|
%
|
|
10.25
|
%
|
|
11.40
|
%
|
Tier I risk-based
capital ratio
|
|
11.51
|
%
|
|
11.69
|
%
|
|
13.66
|
%
|
|
11.51
|
%
|
|
13.66
|
%
|
Total risk-based
capital ratio
|
|
12.94
|
%
|
|
13.08
|
%
|
|
14.78
|
%
|
|
12.94
|
%
|
|
14.78
|
%
|
Per Share
Data
|
|
|
|
|
|
|
|
|
|
|
Basic earnings per
share
|
|
$
|
0.93
|
|
|
$
|
0.84
|
|
|
$
|
0.97
|
|
|
$
|
1.77
|
|
|
$
|
1.72
|
|
Core basic earnings
per share(1)
|
|
$
|
0.94
|
|
|
$
|
0.88
|
|
|
$
|
0.98
|
|
|
$
|
1.82
|
|
|
$
|
1.82
|
|
Diluted earnings per
share
|
|
$
|
0.92
|
|
|
$
|
0.84
|
|
|
$
|
0.96
|
|
|
$
|
1.76
|
|
|
$
|
1.71
|
|
Core diluted earnings
per share(1)
|
|
$
|
0.93
|
|
|
$
|
0.88
|
|
|
$
|
0.97
|
|
|
$
|
1.81
|
|
|
$
|
1.81
|
|
Cash dividends
declared per share
|
|
$
|
0.30
|
|
|
$
|
0.30
|
|
|
$
|
0.30
|
|
|
$
|
0.60
|
|
|
$
|
0.60
|
|
Book value per
share
|
|
$
|
37.43
|
|
|
$
|
36.56
|
|
|
$
|
34.17
|
|
|
$
|
37.43
|
|
|
$
|
34.17
|
|
Tangible book value
per share(1)
|
|
$
|
27.47
|
|
|
$
|
26.48
|
|
|
$
|
27.78
|
|
|
$
|
27.47
|
|
|
$
|
27.78
|
|
Weighted average
number of common shares outstanding
|
|
10,276,876
|
|
|
10,259,995
|
|
|
7,446,156
|
|
|
10,268,440
|
|
|
7,438,626
|
|
Diluted weighted
average number of common shares outstanding
|
|
10,327,374
|
|
|
10,306,400
|
|
|
7,467,365
|
|
|
10,315,245
|
|
|
7,459,464
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Please see
"Reconciliation of non-GAAP to GAAP Financial Measures."
|
|
|
|
|
|
|
|
|
|
(2) In the second
quarter of 2016, the Company adopted ASU 2016-09. First quarter
2016 financial information as presented reflects the impact of the
ASU as adopted.
|
Consolidated
Statements of Condition Data (unaudited)
|
|
|
|
(In thousands, except number of shares)
|
|
June
30,
2016
|
|
December 31,
2015
|
ASSETS
|
|
|
|
|
Cash and due from
banks
|
|
$
|
96,443
|
|
|
$
|
79,488
|
|
Securities:
|
|
|
|
|
Available-for-sale
securities, at fair value
|
|
799,526
|
|
|
750,338
|
|
Held-to-maturity
securities, at amortized cost
|
|
93,609
|
|
|
84,144
|
|
Federal Home Loan
Bank and Federal Reserve Bank stock, at cost
|
|
28,854
|
|
|
21,513
|
|
Total
securities
|
|
921,989
|
|
|
855,995
|
|
Loans held for
sale
|
|
22,928
|
|
|
10,958
|
|
Loans
|
|
2,585,300
|
|
|
2,490,206
|
|
Less: allowance for
loan losses
|
|
(23,717)
|
|
|
(21,166)
|
|
Net loans
|
|
2,561,583
|
|
|
2,469,040
|
|
Goodwill
|
|
94,697
|
|
|
95,657
|
|
Other intangible
assets
|
|
7,715
|
|
|
8,667
|
|
Bank-owned life
insurance
|
|
77,352
|
|
|
59,917
|
|
Premises and
equipment, net
|
|
44,299
|
|
|
45,959
|
|
Deferred tax
assets
|
|
34,559
|
|
|
39,716
|
|
Interest receivable
|
|
8,757
|
|
|
7,985
|
|
Other real estate
owned
|
|
855
|
|
|
1,304
|
|
Other
assets
|
|
39,209
|
|
|
34,658
|
|
Total
assets
|
|
$
|
3,910,386
|
|
|
$
|
3,709,344
|
|
LIABILITIES AND
SHAREHOLDERS' EQUITY
|
|
|
|
|
Liabilities
|
|
|
|
|
Deposits:
|
|
|
|
|
Demand
|
|
$
|
381,323
|
|
|
$
|
357,673
|
|
Interest
checking
|
|
752,036
|
|
|
740,084
|
|
Savings and money
market
|
|
940,577
|
|
|
912,668
|
|
Certificates of
deposit
|
|
493,488
|
|
|
516,867
|
|
Brokered
deposits
|
|
206,063
|
|
|
199,087
|
|
Total
deposits
|
|
2,773,487
|
|
|
2,726,379
|
|
Federal Home Loan
Bank advances
|
|
45,000
|
|
|
55,000
|
|
Other borrowed
funds
|
|
586,799
|
|
|
458,763
|
|
Subordinated
debentures
|
|
58,677
|
|
|
58,599
|
|
Accrued interest and
other liabilities
|
|
61,567
|
|
|
47,413
|
|
Total
liabilities
|
|
3,525,530
|
|
|
3,346,154
|
|
Shareholders'
Equity
|
|
|
|
|
Common stock, no par
value; authorized 20,000,000 shares, issued and outstanding
10,281,113 and 10,220,478 shares as of June 30, 2016 and December
31, 2015, respectively
|
|
154,574
|
|
|
153,083
|
|
Retained
earnings
|
|
234,290
|
|
|
222,329
|
|
Accumulated other
comprehensive loss:
|
|
|
|
|
Net unrealized gains
(losses) on available-for-sale securities, net of tax
|
|
7,347
|
|
|
(3,801)
|
|
Net unrealized losses
on cash flow hedging derivative instruments, net of tax
|
|
(9,384)
|
|
|
(6,374)
|
|
Net unrecognized
losses on postretirement plans, net of tax
|
|
(1,971)
|
|
|
(2,047)
|
|
Total accumulated
other comprehensive loss
|
|
(4,008)
|
|
|
(12,222)
|
|
Total
shareholders' equity
|
|
384,856
|
|
|
363,190
|
|
Total liabilities
and shareholders' equity
|
|
$
|
3,910,386
|
|
|
$
|
3,709,344
|
|
Consolidated
Statements of Income Data (unaudited)
|
|
|
For
The
Three Months
Ended
|
(In thousands, except per share data)
|
|
June
30,
2016
|
|
March
31,
2016
|
|
June
30,
2015
|
Interest
Income
|
|
|
|
|
|
|
Interest and fees on
loans
|
|
$
|
27,706
|
|
|
$
|
27,016
|
|
|
$
|
19,342
|
|
Interest on U.S.
government and sponsored enterprise obligations
|
|
4,016
|
|
|
3,990
|
|
|
3,717
|
|
Interest on state and
political subdivision obligations
|
|
711
|
|
|
714
|
|
|
493
|
|
Interest on federal
funds sold and other investments
|
|
342
|
|
|
261
|
|
|
105
|
|
Total interest
income
|
|
32,775
|
|
|
31,981
|
|
|
23,657
|
|
Interest
Expense
|
|
|
|
|
|
|
Interest on
deposits
|
|
2,109
|
|
|
2,042
|
|
|
1,544
|
|
Interest on
borrowings
|
|
1,313
|
|
|
1,136
|
|
|
847
|
|
Interest on
subordinated debentures
|
|
849
|
|
|
851
|
|
|
631
|
|
Total interest
expense
|
|
4,271
|
|
|
4,029
|
|
|
3,022
|
|
Net interest
income
|
|
28,504
|
|
|
27,952
|
|
|
20,635
|
|
Provision for
credit losses
|
|
2,852
|
|
|
872
|
|
|
254
|
|
Net interest
income after provision for credit losses
|
|
25,652
|
|
|
27,080
|
|
|
20,381
|
|
Non-Interest
Income
|
|
|
|
|
|
|
Service charges on
deposit accounts
|
|
1,833
|
|
|
1,724
|
|
|
1,593
|
|
Other service charges
and fees
|
|
2,331
|
|
|
2,328
|
|
|
1,584
|
|
Mortgage banking
income, net
|
|
1,706
|
|
|
808
|
|
|
346
|
|
Income from fiduciary
services
|
|
1,342
|
|
|
1,169
|
|
|
1,328
|
|
Bank-owned life
insurance
|
|
892
|
|
|
422
|
|
|
402
|
|
Brokerage and
insurance commissions
|
|
517
|
|
|
458
|
|
|
502
|
|
Net gain on sale of
securities
|
|
4
|
|
|
—
|
|
|
—
|
|
Other
income
|
|
1,927
|
|
|
1,008
|
|
|
555
|
|
Total non-interest
income
|
|
10,552
|
|
|
7,917
|
|
|
6,310
|
|
Non-Interest
Expense
|
|
|
|
|
|
|
Salaries and employee
benefits
|
|
11,999
|
|
|
11,591
|
|
|
8,484
|
|
Furniture, equipment
and data processing
|
|
2,381
|
|
|
2,427
|
|
|
1,902
|
|
Net occupancy
costs
|
|
1,790
|
|
|
1,877
|
|
|
1,239
|
|
Consulting and
professional fees
|
|
982
|
|
|
885
|
|
|
673
|
|
Regulatory
assessments
|
|
774
|
|
|
721
|
|
|
511
|
|
Other real estate
owned and collection costs
|
|
496
|
|
|
656
|
|
|
449
|
|
Amortization of
intangible assets
|
|
476
|
|
|
476
|
|
|
287
|
|
Merger and
acquisition costs
|
|
177
|
|
|
644
|
|
|
128
|
|
Other
expenses
|
|
3,255
|
|
|
3,632
|
|
|
2,484
|
|
Total non-interest
expense
|
|
22,330
|
|
|
22,909
|
|
|
16,157
|
|
Income before
income taxes
|
|
13,874
|
|
|
12,088
|
|
|
10,534
|
|
Income
Taxes
|
|
4,258
|
|
|
3,442
|
|
|
3,341
|
|
Net
Income
|
|
$
|
9,616
|
|
|
$
|
8,646
|
|
|
$
|
7,193
|
|
Per Share
Data
|
|
|
|
|
|
|
Basic earnings per
share
|
|
$
|
0.93
|
|
|
$
|
0.84
|
|
|
$
|
0.97
|
|
Diluted earnings per
share
|
|
$
|
0.92
|
|
|
$
|
0.84
|
|
|
$
|
0.96
|
|
Consolidated
Statements of Income Data (unaudited)
|
|
|
For
The
Six Months
Ended
June 30,
|
(In thousands, except per
share data)
|
|
2016
|
|
2015
|
Interest
Income
|
|
|
|
|
Interest and fees on
loans
|
|
$
|
54,722
|
|
|
$
|
37,426
|
|
Interest on U.S.
government and sponsored enterprise obligations
|
|
8,006
|
|
|
7,589
|
|
Interest on state and
political subdivision obligations
|
|
1,425
|
|
|
880
|
|
Interest on federal
funds sold and other investments
|
|
603
|
|
|
210
|
|
Total interest
income
|
|
64,756
|
|
|
46,105
|
|
Interest
Expense
|
|
|
|
|
Interest on
deposits
|
|
4,151
|
|
|
3,073
|
|
Interest on
borrowings
|
|
2,449
|
|
|
1,707
|
|
Interest on junior
subordinated debentures
|
|
1,700
|
|
|
1,256
|
|
Total interest
expense
|
|
8,300
|
|
|
6,036
|
|
Net interest
income
|
|
56,456
|
|
|
40,069
|
|
Provision for
credit losses
|
|
3,724
|
|
|
700
|
|
Net
interest income after provision for credit losses
|
|
52,732
|
|
|
39,369
|
|
Non-Interest
Income
|
|
|
|
|
Service charges on
deposit accounts
|
|
3,557
|
|
|
3,080
|
|
Other service charges
and fees
|
|
4,659
|
|
|
3,094
|
|
Mortgage banking
income, net
|
|
2,514
|
|
|
585
|
|
Income from fiduciary
services
|
|
2,511
|
|
|
2,548
|
|
Bank-owned life
insurance
|
|
1,314
|
|
|
824
|
|
Brokerage and
insurance commissions
|
|
975
|
|
|
951
|
|
Net gain on sale of
securities
|
|
4
|
|
|
—
|
|
Other
income
|
|
2,935
|
|
|
1,375
|
|
Total non-interest
income
|
|
18,469
|
|
|
12,457
|
|
Non-Interest
Expense
|
|
|
|
|
Salaries and employee
benefits
|
|
23,590
|
|
|
16,859
|
|
Furniture, equipment
and data processing
|
|
4,808
|
|
|
3,825
|
|
Net occupancy
costs
|
|
3,667
|
|
|
2,711
|
|
Consulting and
professional fees
|
|
1,867
|
|
|
1,264
|
|
Regulatory
assessments
|
|
1,495
|
|
|
1,021
|
|
Other real estate
owned and collection costs
|
|
1,152
|
|
|
1,011
|
|
Amortization of
intangible assets
|
|
952
|
|
|
574
|
|
Merger and
acquisition costs
|
|
821
|
|
|
863
|
|
Other
expenses
|
|
6,887
|
|
|
4,830
|
|
Total non-interest
expense
|
|
45,239
|
|
|
32,958
|
|
Income before
income taxes
|
|
25,962
|
|
|
18,868
|
|
Income
Taxes
|
|
7,700
|
|
|
6,064
|
|
Net
Income
|
|
$
|
18,262
|
|
|
$
|
12,804
|
|
Per Share
Data
|
|
|
|
|
Basic earnings per
share
|
|
$
|
1.77
|
|
|
$
|
1.72
|
|
Diluted earnings per
share
|
|
$
|
1.76
|
|
|
$
|
1.71
|
|
Quarterly Average
Balance, Interest and Yield/Rate Analysis
(unaudited)
|
|
|
At or for the
Three Months Ended
|
|
At or for the
Three Months Ended
|
|
|
June 30,
2016
|
|
June 30,
2015
|
(In
thousands)
|
|
Average
Balance
|
|
Interest
|
|
Yield/
Rate
|
|
Average
Balance
|
|
Interest
|
|
Yield/
Rate
|
Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-earning
assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
Securities -
taxable
|
|
$
|
801,752
|
|
|
$
|
4,357
|
|
|
2.17
|
%
|
|
$
|
739,404
|
|
|
$
|
3,821
|
|
|
2.07
|
%
|
Securities -
nontaxable(1)
|
|
102,712
|
|
|
1,093
|
|
|
4.26
|
%
|
|
68,699
|
|
|
759
|
|
|
4.42
|
%
|
Loans(2):
|
|
|
|
|
|
|
|
|
|
|
|
|
Residential real
estate
|
|
823,908
|
|
|
8,782
|
|
|
4.26
|
%
|
|
585,978
|
|
|
6,388
|
|
|
4.36
|
%
|
Commercial real
estate(3)
|
|
983,965
|
|
|
10,241
|
|
|
4.12
|
%
|
|
659,252
|
|
|
7,769
|
|
|
4.66
|
%
|
Commercial(1)
|
|
294,795
|
|
|
3,112
|
|
|
4.18
|
%
|
|
248,044
|
|
|
2,374
|
|
|
3.79
|
%
|
Municipal(1)
|
|
17,847
|
|
|
136
|
|
|
3.04
|
%
|
|
13,929
|
|
|
116
|
|
|
3.34
|
%
|
Consumer
|
|
362,735
|
|
|
3,758
|
|
|
4.17
|
%
|
|
295,150
|
|
|
2,840
|
|
|
3.86
|
%
|
HPFC
|
|
72,417
|
|
|
1,825
|
|
|
9.97
|
%
|
|
—
|
|
|
—
|
|
|
—
|
%
|
Total
loans
|
|
2,555,667
|
|
|
27,854
|
|
|
4.34
|
%
|
|
1,802,353
|
|
|
19,487
|
|
|
4.30
|
%
|
Total
interest-earning assets
|
|
3,460,131
|
|
|
33,304
|
|
|
3.83
|
%
|
|
2,610,456
|
|
|
24,067
|
|
|
3.67
|
%
|
Cash and due from
banks
|
|
84,267
|
|
|
|
|
|
|
46,691
|
|
|
|
|
|
Other
assets
|
|
304,453
|
|
|
|
|
|
|
179,212
|
|
|
|
|
|
Less: allowance for
loan losses
|
|
(22,052)
|
|
|
|
|
|
|
(21,403)
|
|
|
|
|
|
Total
assets
|
|
$
|
3,826,799
|
|
|
|
|
|
|
$
|
2,814,956
|
|
|
|
|
|
Liabilities &
Shareholders' Equity
|
|
|
|
|
|
|
|
|
|
|
|
|
Deposits:
|
|
|
|
|
|
|
|
|
|
|
|
|
Demand
|
|
$
|
355,184
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
257,862
|
|
|
$
|
—
|
|
|
—
|
|
Interest
checking
|
|
729,907
|
|
|
228
|
|
|
0.13
|
%
|
|
496,254
|
|
|
102
|
|
|
0.08
|
%
|
Savings
|
|
448,594
|
|
|
66
|
|
|
0.06
|
%
|
|
270,559
|
|
|
40
|
|
|
0.06
|
%
|
Money
market
|
|
490,815
|
|
|
537
|
|
|
0.44
|
%
|
|
375,194
|
|
|
295
|
|
|
0.32
|
%
|
Certificates of
deposit
|
|
483,823
|
|
|
933
|
|
|
0.78
|
%
|
|
312,186
|
|
|
716
|
|
|
0.92
|
%
|
Total
deposits
|
|
2,508,323
|
|
|
1,764
|
|
|
0.28
|
%
|
|
1,712,055
|
|
|
1,153
|
|
|
0.27
|
%
|
Borrowings:
|
|
|
|
|
|
|
|
|
|
|
|
|
Brokered
deposits
|
|
207,371
|
|
|
345
|
|
|
0.67
|
%
|
|
250,484
|
|
|
391
|
|
|
0.63
|
%
|
Subordinated
debentures
|
|
58,658
|
|
|
849
|
|
|
5.82
|
%
|
|
44,063
|
|
|
631
|
|
|
5.75
|
%
|
Other
borrowings
|
|
622,185
|
|
|
1,313
|
|
|
0.85
|
%
|
|
517,563
|
|
|
847
|
|
|
0.66
|
%
|
Total
borrowings
|
|
888,214
|
|
|
2,507
|
|
|
1.14
|
%
|
|
812,110
|
|
|
1,869
|
|
|
0.92
|
%
|
Total funding
liabilities
|
|
3,396,537
|
|
|
4,271
|
|
|
0.51
|
%
|
|
2,524,165
|
|
|
3,022
|
|
|
0.48
|
%
|
Other
liabilities
|
|
51,853
|
|
|
|
|
|
|
36,536
|
|
|
|
|
|
Shareholders'
equity
|
|
378,409
|
|
|
|
|
|
|
254,255
|
|
|
|
|
|
Total liabilities
& shareholders' equity
|
|
$
|
3,826,799
|
|
|
|
|
|
|
$
|
2,814,956
|
|
|
|
|
|
Net interest income
(fully-taxable equivalent)
|
|
|
|
29,033
|
|
|
|
|
|
|
21,045
|
|
|
|
Less: fully-taxable equivalent
adjustment
|
|
|
|
(529)
|
|
|
|
|
|
|
(410)
|
|
|
|
Net interest
income
|
|
|
|
$
|
28,504
|
|
|
|
|
|
|
$
|
20,635
|
|
|
|
Net interest rate
spread (fully-taxable equivalent)
|
|
3.32
|
%
|
|
|
|
|
|
3.19
|
%
|
Net interest
margin (fully-taxable equivalent)
|
|
3.34
|
%
|
|
|
|
|
|
3.21
|
%
|
|
|
|
|
|
|
|
(1) Reported on
tax-equivalent basis calculated using a tax rate of 35%, including
certain commercial loans.
|
(2) Non-accrual
loans and loans held for sale are included in total average
loans.
|
(3) Includes
$734,000 of income recognized in the second quarter of 2015 upon
payoff of one loan that was on non-accrual status.
|
Year-To-Date
Average Balance, Interest and Yield/Rate Analysis
(unaudited)
|
|
|
At or for the Six
Months Ended
|
|
At or for the Six
Months Ended
|
|
|
June 30,
2016
|
|
June 30,
2015
|
(In
thousands)
|
|
Average
Balance
|
|
Interest
|
|
Yield/
Rate
|
|
Average
Balance
|
|
Interest
|
|
Yield/
Rate
|
Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-earning
assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
Securities -
taxable
|
|
$
|
791,638
|
|
|
$
|
8,608
|
|
|
2.17
|
%
|
|
$
|
742,444
|
|
|
$
|
7,799
|
|
|
2.10
|
%
|
Securities -
nontaxable(1)
|
|
102,385
|
|
|
2,192
|
|
|
4.28
|
%
|
|
59,947
|
|
|
1,354
|
|
|
4.52
|
%
|
Loans(2):
|
|
|
|
|
|
|
|
|
|
|
|
|
Residential real
estate
|
|
826,002
|
|
|
17,250
|
|
|
4.18
|
%
|
|
586,464
|
|
|
12,581
|
|
|
4.29
|
%
|
Commercial real
estate(3)
|
|
966,418
|
|
|
20,296
|
|
|
4.15
|
%
|
|
656,143
|
|
|
14,625
|
|
|
4.43
|
%
|
Commercial(1)
|
|
282,004
|
|
|
6,266
|
|
|
4.39
|
%
|
|
244,772
|
|
|
4,688
|
|
|
3.81
|
%
|
Municipal(1)
|
|
15,636
|
|
|
255
|
|
|
3.27
|
%
|
|
12,250
|
|
|
215
|
|
|
3.54
|
%
|
Consumer
|
|
364,088
|
|
|
7,545
|
|
|
4.17
|
%
|
|
292,241
|
|
|
5,599
|
|
|
3.86
|
%
|
HPFC
|
|
74,424
|
|
|
3,398
|
|
|
9.03
|
%
|
|
—
|
|
|
—
|
|
|
—
|
%
|
Total
loans
|
|
2,528,572
|
|
|
55,010
|
|
|
4.33
|
%
|
|
1,791,870
|
|
|
37,708
|
|
|
4.20
|
%
|
Total
interest-earning assets
|
|
3,422,595
|
|
|
65,810
|
|
|
3.83
|
%
|
|
2,594,261
|
|
|
46,861
|
|
|
3.61
|
%
|
Cash and due from
banks
|
|
81,936
|
|
|
|
|
|
|
46,832
|
|
|
|
|
|
Other
assets
|
|
301,759
|
|
|
|
|
|
|
180,062
|
|
|
|
|
|
Less: allowance for
loan losses
|
|
(21,668)
|
|
|
|
|
|
|
(21,316)
|
|
|
|
|
|
Total
assets
|
|
$
|
3,784,622
|
|
|
|
|
|
|
$
|
2,799,839
|
|
|
|
|
|
Liabilities &
Shareholders' Equity
|
|
|
|
|
|
|
|
|
|
|
|
|
Deposits:
|
|
|
|
|
|
|
|
|
|
|
|
|
Demand
|
|
$
|
350,179
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
257,513
|
|
|
$
|
—
|
|
|
—
|
|
Interest
checking
|
|
723,424
|
|
|
393
|
|
|
0.11
|
%
|
|
488,460
|
|
|
187
|
|
|
0.08
|
%
|
Savings
|
|
449,584
|
|
|
133
|
|
|
0.06
|
%
|
|
268,308
|
|
|
78
|
|
|
0.06
|
%
|
Money
market
|
|
484,003
|
|
|
1,005
|
|
|
0.42
|
%
|
|
382,839
|
|
|
586
|
|
|
0.31
|
%
|
Certificates of
deposit
|
|
496,023
|
|
|
1,863
|
|
|
0.76
|
%
|
|
312,848
|
|
|
1,437
|
|
|
0.93
|
%
|
Total
deposits
|
|
2,503,213
|
|
|
3,394
|
|
|
0.27
|
%
|
|
1,709,968
|
|
|
2,288
|
|
|
0.27
|
%
|
Borrowings:
|
|
|
|
|
|
|
|
|
|
|
|
|
Brokered
deposits
|
|
204,767
|
|
|
757
|
|
|
0.74
|
%
|
|
238,128
|
|
|
785
|
|
|
0.66
|
%
|
Junior subordinated
debentures
|
|
58,719
|
|
|
1,700
|
|
|
5.82
|
%
|
|
44,050
|
|
|
1,256
|
|
|
5.75
|
%
|
Other
borrowings
|
|
592,206
|
|
|
2,449
|
|
|
0.83
|
%
|
|
519,823
|
|
|
1,707
|
|
|
0.66
|
%
|
Total
borrowings
|
|
855,692
|
|
|
4,906
|
|
|
1.15
|
%
|
|
802,001
|
|
|
3,748
|
|
|
0.94
|
%
|
Total funding
liabilities
|
|
3,358,905
|
|
|
8,300
|
|
|
0.50
|
%
|
|
2,511,969
|
|
|
6,036
|
|
|
0.48
|
%
|
Other
liabilities
|
|
51,784
|
|
|
|
|
|
|
36,859
|
|
|
|
|
|
Shareholders'
equity
|
|
373,933
|
|
|
|
|
|
|
251,011
|
|
|
|
|
|
Total liabilities
& shareholders' equity
|
|
$
|
3,784,622
|
|
|
|
|
|
|
$
|
2,799,839
|
|
|
|
|
|
Net interest income
(fully-taxable equivalent)
|
|
|
|
57,510
|
|
|
|
|
|
|
40,825
|
|
|
|
Less: fully-taxable equivalent
adjustment
|
|
|
|
(1,054)
|
|
|
|
|
|
|
(756)
|
|
|
|
Net interest
income
|
|
|
|
$
|
56,456
|
|
|
|
|
|
|
$
|
40,069
|
|
|
|
Net interest rate
spread (fully-taxable equivalent)
|
|
3.33
|
%
|
|
|
|
|
|
3.13
|
%
|
Net interest
margin (fully-taxable equivalent)
|
|
3.34
|
%
|
|
|
|
|
|
3.14
|
%
|
|
|
|
|
|
(1) Reported on
tax-equivalent basis calculated using a tax rate of 35%, including
certain commercial loans.
|
|
|
|
|
(2) Non-accrual
loans and loans held for sale are included in total average
loans.
|
|
|
|
|
(3) Includes
$734,000 of income recognized in the second quarter of 2015 upon
payoff of one loan that was on non-accrual status.
|
Asset Quality Data
(unaudited)
|
(In
thousands)
|
|
At or For The
Six Months Ended
June 30, 2016
|
|
At or For The
Three Months Ended
March 31, 2016
|
|
At or For The
Year Ended
December 31, 2015
|
|
At or For The
Nine Months Ended
September 30, 2015
|
|
At or For The
Six Months Ended
June 30, 2015
|
Non-accrual
loans:
|
|
|
|
|
|
|
|
|
|
|
Residential real
estate
|
|
$
|
4,697
|
|
|
$
|
6,275
|
|
|
$
|
7,253
|
|
|
$
|
4,149
|
|
|
$
|
4,498
|
|
Commercial real
estate
|
|
13,752
|
|
|
3,044
|
|
|
4,529
|
|
|
3,384
|
|
|
2,813
|
|
Commercial
|
|
3,539
|
|
|
4,128
|
|
|
4,489
|
|
|
1,383
|
|
|
1,425
|
|
Consumer
|
|
1,615
|
|
|
1,572
|
|
|
2,051
|
|
|
1,243
|
|
|
1,957
|
|
HPFC
|
|
110
|
|
|
357
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Total non-accrual
loans
|
|
23,713
|
|
|
15,376
|
|
|
18,322
|
|
|
10,159
|
|
|
10,693
|
|
Loans 90 days past
due and accruing
|
|
112
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Accruing
troubled-debt restructured loans not included above
|
|
4,509
|
|
|
4,594
|
|
|
4,861
|
|
|
5,013
|
|
|
5,313
|
|
Total
non-performing loans
|
|
28,334
|
|
|
19,970
|
|
|
23,183
|
|
|
15,172
|
|
|
16,006
|
|
Other real estate
owned:
|
|
|
|
|
|
|
|
|
|
|
Residential real
estate
|
|
80
|
|
|
273
|
|
|
407
|
|
|
204
|
|
|
300
|
|
Commercial real
estate
|
|
775
|
|
|
955
|
|
|
897
|
|
|
—
|
|
|
351
|
|
Total other real
estate owned
|
|
855
|
|
|
1,228
|
|
|
1,304
|
|
|
204
|
|
|
651
|
|
Total
non-performing assets
|
|
$
|
29,189
|
|
|
$
|
21,198
|
|
|
$
|
24,487
|
|
|
$
|
15,376
|
|
|
$
|
16,657
|
|
Loans 30-89 days
past due:
|
|
|
|
|
|
|
|
|
|
|
Residential real
estate
|
|
$
|
2,159
|
|
|
$
|
1,109
|
|
|
$
|
3,590
|
|
|
$
|
1,153
|
|
|
$
|
1,287
|
|
Commercial real
estate
|
|
2,267
|
|
|
4,201
|
|
|
4,295
|
|
|
1,281
|
|
|
586
|
|
Commercial
|
|
630
|
|
|
667
|
|
|
637
|
|
|
497
|
|
|
718
|
|
Consumer
|
|
1,090
|
|
|
808
|
|
|
1,255
|
|
|
315
|
|
|
897
|
|
HPFC
|
|
876
|
|
|
624
|
|
|
165
|
|
|
—
|
|
|
—
|
|
Total loans 30-89
days past due
|
|
$
|
7,022
|
|
|
$
|
7,409
|
|
|
$
|
9,942
|
|
|
$
|
3,246
|
|
|
$
|
3,488
|
|
Allowance for loan
losses at the beginning of the period
|
|
$
|
21,166
|
|
|
$
|
21,166
|
|
|
$
|
21,116
|
|
|
$
|
21,116
|
|
|
$
|
21,116
|
|
Provision for loan
losses
|
|
3,724
|
|
|
870
|
|
|
1,938
|
|
|
972
|
|
|
691
|
|
Charge-offs:
|
|
|
|
|
|
|
|
|
|
|
Residential real
estate
|
|
229
|
|
|
210
|
|
|
801
|
|
|
468
|
|
|
292
|
|
Commercial real
estate
|
|
241
|
|
|
222
|
|
|
481
|
|
|
174
|
|
|
103
|
|
Commercial
|
|
429
|
|
|
226
|
|
|
655
|
|
|
387
|
|
|
243
|
|
Consumer
|
|
226
|
|
|
143
|
|
|
679
|
|
|
481
|
|
|
260
|
|
HPFC
|
|
302
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Total
charge-offs
|
|
1,427
|
|
|
801
|
|
|
2,616
|
|
|
1,510
|
|
|
898
|
|
Total
recoveries
|
|
254
|
|
|
104
|
|
|
728
|
|
|
554
|
|
|
285
|
|
Net
charge-offs
|
|
1,173
|
|
|
697
|
|
|
1,888
|
|
|
956
|
|
|
613
|
|
Allowance for loan
losses at the end of the period
|
|
$
|
23,717
|
|
|
$
|
21,339
|
|
|
$
|
21,166
|
|
|
$
|
21,132
|
|
|
$
|
21,194
|
|
Components of
allowance for credit losses:
|
|
|
|
|
|
|
|
|
|
|
Allowance for loan
losses
|
|
$
|
23,717
|
|
|
$
|
21,339
|
|
|
$
|
21,166
|
|
|
$
|
21,132
|
|
|
$
|
21,194
|
|
Liability for
unfunded credit commitments
|
|
22
|
|
|
24
|
|
|
22
|
|
|
24
|
|
|
26
|
|
Allowance for
credit losses
|
|
$
|
23,739
|
|
|
$
|
21,363
|
|
|
$
|
21,188
|
|
|
$
|
21,156
|
|
|
$
|
21,220
|
|
Ratios:
|
|
|
|
|
|
|
|
|
|
|
Non-performing loans
to total loans
|
|
1.10
|
%
|
|
0.80
|
%
|
|
0.93
|
%
|
|
0.83
|
%
|
|
0.89
|
%
|
Non-performing assets
to total assets
|
|
0.75
|
%
|
|
0.56
|
%
|
|
0.66
|
%
|
|
0.54
|
%
|
|
0.59
|
%
|
Allowance for loan
losses to total loans
|
|
0.92
|
%
|
|
0.86
|
%
|
|
0.85
|
%
|
|
1.15
|
%
|
|
1.17
|
%
|
Net charge-offs to
average loans (annualized):
|
|
|
|
|
|
|
|
|
|
|
Quarter-to-date
|
|
0.07
|
%
|
|
0.11
|
%
|
|
0.16
|
%
|
|
0.08
|
%
|
|
0.07
|
%
|
Year-to-date
|
|
0.09
|
%
|
|
0.11
|
%
|
|
0.10
|
%
|
|
0.07
|
%
|
|
0.07
|
%
|
Allowance for loan
losses to non-performing loans
|
|
85.71
|
%
|
|
106.86
|
%
|
|
91.30
|
%
|
|
139.27
|
%
|
|
132.41
|
%
|
Loans 30-89 days past
due to total loans
|
|
0.27
|
%
|
|
0.30
|
%
|
|
0.40
|
%
|
|
0.18
|
%
|
|
0.19
|
%
|
Reconciliation of
non-GAAP to GAAP Financial Measures
|
|
Efficiency
Ratio, Core Operating Expenses and Core Operating Expenses to Total
Average Assets:
|
|
|
For
the
Three Months
Ended
|
|
For the
Six Months Ended
|
(In
thousands)
|
|
June 30,
2016
|
|
March 31,
2016
|
|
June 30,
2015
|
|
June 30,
2016
|
|
June 30,
2015
|
Efficiency
Ratio and Core Operating Expenses:
|
|
|
|
|
|
|
|
|
|
|
Non-interest expense,
as presented
|
|
$
|
22,330
|
|
|
$
|
22,909
|
|
|
$
|
16,157
|
|
|
$
|
45,239
|
|
|
$
|
32,958
|
|
Less: merger and
acquisition costs
|
|
(177)
|
|
|
(644)
|
|
|
(128)
|
|
|
(821)
|
|
|
(863)
|
|
Core operating
expenses
|
|
$
|
22,153
|
|
|
$
|
22,265
|
|
|
$
|
16,029
|
|
|
$
|
44,418
|
|
|
$
|
32,095
|
|
Net interest income,
as presented
|
|
$
|
28,504
|
|
|
$
|
27,952
|
|
|
$
|
20,635
|
|
|
$
|
56,456
|
|
|
$
|
40,069
|
|
Add: effect of
tax-exempt income(1)
|
|
529
|
|
|
525
|
|
|
410
|
|
|
1,054
|
|
|
756
|
|
Non-interest income,
as presented
|
|
10,552
|
|
|
7,917
|
|
|
6,310
|
|
|
18,469
|
|
|
12,457
|
|
Less: net gain on
sale of securities
|
|
(4)
|
|
|
—
|
|
|
—
|
|
|
(4)
|
|
|
—
|
|
Less:
bank-owned life insurance death benefit
|
|
(394)
|
|
|
—
|
|
|
—
|
|
|
(394)
|
|
|
—
|
|
Adjusted net interest
income plus non-interest income
|
|
$
|
39,187
|
|
|
$
|
36,394
|
|
|
$
|
27,355
|
|
|
$
|
75,581
|
|
|
$
|
53,282
|
|
Non-GAAP efficiency
ratio
|
|
56.53
|
%
|
|
61.18
|
%
|
|
58.60
|
%
|
|
58.77
|
%
|
|
60.24
|
%
|
GAAP efficiency
ratio
|
|
57.17
|
%
|
|
63.87
|
%
|
|
59.96
|
%
|
|
60.38
|
%
|
|
62.75
|
%
|
Core Operating
Expenses to Total Average Assets:
|
|
|
|
|
|
|
|
|
|
|
Total average
assets
|
|
$
|
3,826,799
|
|
|
$
|
3,742,445
|
|
|
$
|
2,814,956
|
|
|
$
|
3,784,622
|
|
|
$
|
2,799,839
|
|
Core operating
expenses to total average assets (annualized)
|
|
2.32
|
%
|
|
2.38
|
%
|
|
2.28
|
%
|
|
2.35
|
%
|
|
2.29
|
%
|
Non-interest expense
to total average assets (annualized)
|
|
2.33
|
%
|
|
2.45
|
%
|
|
2.30
|
%
|
|
2.39
|
%
|
|
2.35
|
%
|
(1) Assumed a 35% tax
rate.
|
|
|
|
|
|
|
|
|
|
|
Tax-Equivalent
Net Interest Income:
|
|
|
|
|
|
|
|
|
For the
Three Months Ended
|
|
For the
Six Months Ended
|
(In
thousands)
|
|
June 30,
2016
|
|
March 31,
2016
|
|
June 30,
2015
|
|
June 30,
2016
|
|
June 30,
2015
|
Net interest income,
as presented
|
|
$
|
28,504
|
|
|
$
|
27,952
|
|
|
$
|
20,635
|
|
|
$
|
56,456
|
|
|
$
|
40,069
|
|
Add: effect of
tax-exempt income(1)
|
|
529
|
|
|
525
|
|
|
410
|
|
|
1,054
|
|
|
756
|
|
Net interest income,
tax equivalent
|
|
$
|
29,033
|
|
|
$
|
28,477
|
|
|
$
|
21,045
|
|
|
$
|
57,510
|
|
|
$
|
40,825
|
|
(1) Assumed a 35% tax
rate.
|
|
|
|
|
|
|
|
|
|
|
Tangible Book
Value Per Share and Tangible Common Equity
Ratio:
|
(In thousands,
except number of shares and per share data)
|
|
June 30,
2016
|
|
March 31,
2016
|
|
June 30,
2015
|
Tangible Book
Value Per Share:
|
|
Shareholders' equity,
as presented
|
|
$
|
384,856
|
|
|
$
|
375,458
|
|
|
$
|
254,540
|
|
Less: goodwill and
other intangible assets
|
|
(102,413)
|
|
|
(103,458)
|
|
|
(47,596)
|
|
Tangible
equity
|
|
$
|
282,443
|
|
|
$
|
272,000
|
|
|
$
|
206,944
|
|
Shares outstanding at
period end
|
|
10,281,113
|
|
|
10,270,989
|
|
|
7,449,645
|
|
Tangible book value
per share
|
|
$
|
27.47
|
|
|
$
|
26.48
|
|
|
$
|
27.78
|
|
Book value per
share
|
|
$
|
37.43
|
|
|
$
|
36.56
|
|
|
$
|
34.17
|
|
Tangible Common
Equity Ratio:
|
Total
assets
|
|
$
|
3,910,386
|
|
|
$
|
3,762,540
|
|
|
$
|
2,837,921
|
|
Less: goodwill and
other intangibles
|
|
(102,413)
|
|
|
(103,458)
|
|
|
(47,596)
|
|
Tangible
assets
|
|
$
|
3,807,973
|
|
|
$
|
3,659,082
|
|
|
$
|
2,790,325
|
|
Tangible common
equity ratio
|
|
7.42
|
%
|
|
7.43
|
%
|
|
7.42
|
%
|
Shareholders' equity
to total assets
|
|
9.84
|
%
|
|
9.98
|
%
|
|
8.97
|
%
|
Core Operating
Earnings, Core Diluted EPS, Core Return on Average Assets, and Core
Return on Average Equity:
|
|
|
For the
Three Months Ended
|
|
For the
Six Months Ended
|
(In thousands,
except per share data)
|
|
June 30,
2016
|
|
March 31,
2016
|
|
June 30,
2015
|
|
June 30,
2016
|
|
June 30,
2015
|
Core Operating
Earnings:
|
|
|
|
|
|
|
|
|
|
|
Net income, as
presented
|
|
$
|
9,616
|
|
|
$
|
8,646
|
|
|
$
|
7,193
|
|
|
$
|
18,262
|
|
|
$
|
12,804
|
|
Merger and
acquisition costs, net of tax(1)
|
|
115
|
|
|
419
|
|
|
115
|
|
|
534
|
|
|
768
|
|
Core operating
earnings
|
|
$
|
9,731
|
|
|
$
|
9,065
|
|
|
$
|
7,308
|
|
|
$
|
18,796
|
|
|
$
|
13,572
|
|
Core Basic
EPS:
|
|
|
|
|
|
|
|
|
|
|
Basic EPS, as
presented
|
|
$
|
0.93
|
|
|
$
|
0.84
|
|
|
$
|
0.97
|
|
|
$
|
1.77
|
|
|
$
|
1.72
|
|
Non-core transactions
impact
|
|
0.01
|
|
|
0.04
|
|
|
0.01
|
|
|
0.05
|
|
|
0.10
|
|
Core basic
EPS
|
|
$
|
0.94
|
|
|
$
|
0.88
|
|
|
$
|
0.98
|
|
|
$
|
1.82
|
|
|
$
|
1.82
|
|
Core Diluted
EPS:
|
|
|
|
|
|
|
|
|
|
|
Diluted EPS, as
presented
|
|
$
|
0.92
|
|
|
$
|
0.84
|
|
|
$
|
0.96
|
|
|
$
|
1.76
|
|
|
$
|
1.71
|
|
Non-core transactions
impact
|
|
0.01
|
|
|
0.04
|
|
|
0.01
|
|
|
0.05
|
|
|
0.10
|
|
Core diluted
EPS
|
|
$
|
0.93
|
|
|
$
|
0.88
|
|
|
$
|
0.97
|
|
|
$
|
1.81
|
|
|
$
|
1.81
|
|
Core Return on
Average Assets:
|
|
|
|
|
|
|
|
|
|
|
Return on average
assets, as presented
|
|
1.01
|
%
|
|
0.93
|
%
|
|
1.02
|
%
|
|
0.97
|
%
|
|
0.92
|
%
|
Non-core transactions
impact
|
|
0.01
|
%
|
|
0.04
|
%
|
|
0.02
|
%
|
|
0.03
|
%
|
|
0.06
|
%
|
Core return on
average assets
|
|
1.02
|
%
|
|
0.97
|
%
|
|
1.04
|
%
|
|
1.00
|
%
|
|
0.98
|
%
|
Core Return on
Average Equity:
|
|
|
|
|
|
|
|
|
|
|
Return on average
equity, as presented
|
|
10.22
|
%
|
|
9.41
|
%
|
|
11.35
|
%
|
|
9.82
|
%
|
|
10.29
|
%
|
Non-core transactions
impact
|
|
0.12
|
%
|
|
0.46
|
%
|
|
0.15
|
%
|
|
0.29
|
%
|
|
0.52
|
%
|
Core return on
average equity
|
|
10.34
|
%
|
|
9.87
|
%
|
|
11.50
|
%
|
|
10.11
|
%
|
|
10.81
|
%
|
(1) Assumed a 35% tax
rate for deductible expenses.
|
|
|
|
|
|
|
|
|
Core Return on
Average Tangible Equity:
|
|
|
|
|
|
|
|
|
For the
Three Months Ended
|
|
For the
Six Months Ended
|
(In
thousands)
|
|
June 30,
2016
|
|
March 31,
2016
|
|
June 30,
2015
|
|
June 30,
2016
|
|
June 30,
2015
|
Net income, as
presented
|
|
$
|
9,616
|
|
|
$
|
8,646
|
|
|
$
|
7,193
|
|
|
$
|
18,262
|
|
|
$
|
12,804
|
|
Amortization of
intangible assets, net of tax(1)
|
|
309
|
|
|
309
|
|
|
187
|
|
|
619
|
|
|
373
|
|
Net income,
adjusted
|
|
9,925
|
|
|
8,955
|
|
|
7,380
|
|
|
18,881
|
|
|
13,177
|
|
Merger and
acquisition costs, net of tax(2)
|
|
115
|
|
|
419
|
|
|
115
|
|
|
534
|
|
|
768
|
|
Core tangible
operating earnings
|
|
$
|
10,040
|
|
|
$
|
9,374
|
|
|
$
|
7,495
|
|
|
$
|
19,415
|
|
|
$
|
13,945
|
|
Average
equity
|
|
$
|
378,409
|
|
|
$
|
369,458
|
|
|
$
|
254,255
|
|
|
$
|
373,933
|
|
|
$
|
251,013
|
|
Less: average goodwill
and other intangible assets
|
|
(103,203)
|
|
|
(103,800)
|
|
|
(47,733)
|
|
|
(103,502)
|
|
|
(47,875)
|
|
Average tangible
equity
|
|
$
|
275,206
|
|
|
$
|
265,658
|
|
|
$
|
206,522
|
|
|
$
|
270,431
|
|
|
$
|
203,138
|
|
Core return on
average tangible equity
|
|
14.67
|
%
|
|
14.19
|
%
|
|
14.56
|
%
|
|
14.44
|
%
|
|
13.84
|
%
|
Return on average
tangible equity
|
|
14.50
|
%
|
|
13.56
|
%
|
|
14.33
|
%
|
|
14.04
|
%
|
|
13.08
|
%
|
Return on average
equity
|
|
10.22
|
%
|
|
9.41
|
%
|
|
11.35
|
%
|
|
9.82
|
%
|
|
10.29
|
%
|
(1) Assumed a 35% tax
rate.
|
|
|
|
|
|
|
|
|
|
|
(2) Assumed a 35% tax
rate for deductible expenses.
|
|
|
|
|
|
|
|
|
Normalized Net
Interest Margin
|
|
|
|
|
|
|
|
|
For the
Three Months Ended
|
|
For the
Six Months Ended
|
(In
thousands)
|
|
June 30,
2016
|
|
March 31,
2016
|
|
June 30,
2015
|
|
June 30,
2016
|
|
June 30,
2015
|
Net interest income,
tax equivalent, as presented
|
|
$
|
29,033
|
|
|
$
|
28,477
|
|
|
$
|
21,045
|
|
|
$
|
57,510
|
|
|
$
|
40,825
|
|
Less: fair value mark
accretion from purchase accounting
|
|
(1,731)
|
|
|
(1,409)
|
|
|
(16)
|
|
|
(3,140)
|
|
|
(51)
|
|
Less: collection of
previously charged-off acquired loans
|
|
(406)
|
|
|
(370)
|
|
|
—
|
|
|
(776)
|
|
|
—
|
|
Normalized net
interest income, tax equivalent
|
|
$
|
26,896
|
|
|
$
|
26,698
|
|
|
$
|
21,029
|
|
|
$
|
53,594
|
|
|
$
|
40,774
|
|
Average total
interest-earnings assets
|
|
$
|
3,460,131
|
|
|
$
|
3,385,057
|
|
|
$
|
2,610,456
|
|
|
$
|
3,422,595
|
|
|
$
|
2,594,261
|
|
Net interest margin
(fully-taxable equivalent)(1)
|
|
3.34
|
%
|
|
3.35
|
%
|
|
3.21
|
%
|
|
3.34
|
%
|
|
3.14
|
%
|
Normalized net
interest margin (fully-taxable equivalent)(1)
|
|
3.09
|
%
|
|
3.14
|
%
|
|
3.21
|
%
|
|
3.11
|
%
|
|
3.14
|
%
|
(1)
Annualized.
|
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SOURCE Camden National Corporation