PITTSFIELD, Mass., April 28, 2014 /PRNewswire/ -- Berkshire
Hills Bancorp, Inc. (NYSE: BHLB) reported that core earnings per
share increased by 5% to $0.42 in the
first quarter of 2014 compared to $0.40 in the previous quarter due to strong
balance sheet growth. Core earnings per share decreased from
$0.54 in the first quarter of 2013
due primarily to lower income on real estate related loans
resulting from interest rate related market shifts in 2013.
![LOGO LOGO](http://photos.prnewswire.com/prnvar/20120131/NE44966LOGO)
On January 17, 2014, Berkshire completed the acquisition of 20
branches in Central New York from
Bank of America. During the first quarter, the Company
recorded non-core charges totaling $0.46 per share after-tax, primarily related to
one-time costs recorded with this acquisition. This
included $0.25 per share from the
Company's election to terminate interest rate swaps; these charges
had no net impact on shareholders' equity. Including non-core
charges, Berkshire recorded a GAAP
loss of $0.04 per share during the
first quarter of 2014, compared to per share income of $0.42 in the prior quarter and the first quarter
of 2013.
FIRST QUARTER FINANCIAL HIGHLIGHTS (income related
comparisons are to prior quarter):
- 7% increase in net interest income
- 14% increase in fee income
- 9% annualized increase in commercial loans
- 11% annualized increase in consumer loans
- 10% increase in deposits, including acquired branches
- 3.35% net interest margin, increased from 3.26% in the prior
quarter
- 0.46% non-performing assets/total assets
- 0.30% net loan charge-offs/average loans
CEO Michael Daly stated, "We
started the year with solid growth. Commercial loans
increased at a near double digit annualized rate, as our lending
teams continue to garner market share and new relationships across
our footprint. We opened a new branch office in Loudonville, New York and continued to develop
our consumer deposit and loan business. Our insurance and
wealth management revenues improved and we are extending our reach
in newer markets.
"We completed the acquisition of 20 Central New York branches
near the start of the year. The integration of these new
customers has been successful and our total branch count has
increased to 90 full service offices, including 46 in New
York. We also announced the recruitment of Scott Houghtaling as SVP/Commercial Leader for
our expanded New York
operations."
Mr. Daly concluded, "Our net interest margin improved as a
result of the branch acquisition. While non-interest expense
also increased, organic expense growth was mostly limited to
seasonal factors. Our non-core costs were primarily due to the
branch acquisition and related termination of interest rate swaps
which were previously disclosed. Going forward, we anticipate
that our net results will mirror our core operating
profitability. We continue to be selective and disciplined in
managing our revenue growth, with a goal of maintaining forward
momentum in operating results."
DIVIDEND DECLARED
The Board of Directors voted to declare a cash dividend of
$0.18 per share to shareholders of
record at the close of business on May 15,
2014, payable on May 29,
2014. This dividend equates to a 2.8% annualized yield based
on the $25.56 average closing price
of Berkshire's common stock during
the first quarter of 2014.
FINANCIAL CONDITION
Berkshire increased its total
assets by $338 million (6%) in the
most recent quarter due to growth in loans and investment
securities. Acquired deposits were used to repay borrowings
and to fund asset growth. At quarter-end, measures of asset
quality, liquidity, interest rate sensitivity, and capital remained
within targets.
As of March 31, 2014, tangible
book value per share measured $15.84,
compared to $16.27 at the start of
the quarter due primarily to the impacts of the branch
acquisition. Total book value per share measured $26.99 and $27.08
at these dates, respectively.
Investment securities increased by $275
million during the first quarter. Growth consisted
primarily of medium term U.S. agency collateralized mortgage
securities, along with municipal bonds and corporate equities.
Total loans increased by $62
million (6% annualized) including 9% annualized commercial
loan growth and 11% annualized consumer loan growth. This
follows the trend of double digit annualized growth in these loans
reported in prior quarters. All regions contributed to
commercial loan originations, with strong contributions from
Berkshire County and Central and
Eastern Massachusetts, as well as
asset based lending. Consumer loan growth was primarily in
automobile loans reflecting continued expansion by the Syracuse based consumer team. Most of
the total loan growth was recorded in the final month of the
quarter.
Asset quality metrics remained favorable. Annualized net
loan charge-offs measured 0.30% of average loans.
Quarter-end non-performing assets decreased to 0.46% of total
assets and accruing delinquent loans decreased to 0.59% of total
loans. The loan loss allowance measured 0.79% of total loans;
approximately 23% of quarter-end loans were balances recorded at
fair value in recent bank acquisitions.
Total deposits increased by $370
million (10%) during the first quarter. Deposits added
from the New York branch
acquisition were recorded at $440
million and acquired balances were retained during the
quarter. In conjunction with the deposit
acquisition, the Company has de-emphasized select municipal deposit
sources and other higher cost deposits. Ongoing development
of consumer relationships was demonstrated by a 5% organic increase
in personal demand deposit balances, excluding acquired
balances. Due to the deposit growth, the loans/deposits ratio
decreased to 101% from 109% during the quarter.
Borrowings were initially reduced with the acquired funds and
subsequently were increased to fund asset growth. In
conjunction with the branch acquisition, the Company terminated all
of its interest rate swaps associated with FHLB advances, which had
a notional value of $410
million. During the quarter, the Company initiated
$300 million in new medium term
forward starting swaps.
The ratio of equity/assets measured 11.3% at quarter-end,
decreasing from 12.0% at the start of the quarter due to the 6.0%
increase in total assets following the branch acquisition.
This transaction also increased goodwill and intangible
assets. Excluding these assets, the ratio of tangible
equity/assets decreased to 6.9% from 7.5%.
RESULTS OF OPERATIONS
First quarter 2014 core earnings totaled $10.4 million ($0.42 per share), compared to $10.0 million ($0.40 per share) in the prior quarter and to
$13.5 million ($0.54 per share) in the first quarter of
2013. The core return on assets measured 0.71%, 0.73%, and
1.03% for these periods respectively. The branch acquisition
resulted in higher core revenue and expenses in the most recent
quarter, compared to the prior quarter.
GAAP earnings include the impact of net non-core charges.
The reconciliation of net income and core income, together with
related financial measures, is shown in financial table F-9.
Non-core charges totaled $11.5
million ($0.46 per share)
after-tax in the most recent quarter. These charges included
$0.25 per share recorded as a loss on
termination of interest rate swap hedges. This was a charge
with no impact on shareholders' equity and was related to the
branch acquisition. Other non-core charges included
$0.10 per share in transaction and
integration expenses for the branch acquisition, $0.07 per share in expenses for restructuring and
systems conversions, and $0.04 per
share for an out-of-period adjustment to interest income recorded
on loans previously acquired in business combinations.
Including these net non-core charges, first quarter 2014 GAAP
results were a loss of $1.1 million
($0.04 per share). GAAP net
income totaled $10.5 million
($0.42 per share) in both the prior
quarter and in the first quarter of 2013. The GAAP loss
resulted in a GAAP ROA of (0.08%) in the most recent quarter,
compared to 0.77% and 0.80% in the prior periods, respectively.
Total net interest and fee revenue was $55.4 million in the most recent quarter, which
was a 9% increase over the prior quarter, and 2% lower than the
first quarter of the previous year due to the decline in
residential mortgage fees. First quarter 2014 net interest
income totaled $42.8 million,
increasing by 7% over the prior quarter and 2% over the first
quarter of 2013.
The net interest margin measured 3.35%, 3.26% and 3.73% for
these periods, respectively. In the most recent quarter, the
margin benefited from the lower cost of acquired deposits and lower
interest cost on borrowings as a result of the swap
terminations. The cost of funds decreased to 0.56% from 0.73%
in the prior quarter and from 0.81% in the first quarter of
2013.
Net interest income includes purchased loan accretion related to
loans acquired in business combinations, including recoveries on
the collection of acquired impaired loans. Current
period purchased loan accretion totaled $2.8
million in the most recent quarter, compared to $2.4 million in the prior quarter, and
$3.8 million in the first quarter of
2013. Excluding current and out-of-period purchased loan
accretion, the net interest margin was 3.24%, 3.07%, and 3.39% in
these respective periods.
Fee income totaled $12.7 million,
increasing by $1.6 million (14%)
compared to the prior quarter and including the benefit of acquired
branch operations and seasonal insurance contingency
revenues. Fee income decreased by $1.8
million (12%) compared to the first quarter of 2013.
Revenue from mortgage banking and loan related fee income decreased
from elevated levels last year due to the midyear increase in
interest rates in 2013. Wealth management fees increased by
13% over the first quarter of 2013 due to account growth and
improved market conditions. Wealth management generated new
business at a 9% annualized rate in the most recent quarter, and
the portfolio totaled $1.3 billion at
quarter-end. Insurance fees increased by 2% over this
period.
The provision for loan losses totaled $3.4 million, continuing its gradual increasing
trend as loan volume has increased and acquired loans season.
Net charge-offs totaled $3.1 million
during the quarter. The provision totaled $3.1 million in the prior quarter and
$2.4 million in the first quarter of
2013.
First quarter 2014 core non-interest expense totaled
$39.1 million. Including the 20
acquired branches, core expense increased by $4.4 million (13%) compared to the prior quarter
and by a similar amount compared to the first quarter of
2013. First quarter expense includes seasonally higher
benefits and maintenance expense. Expense growth in the most
recent quarter also included targeted investment in commercial and
retail market teams. Including net charges for non-core
merger, conversion, and restructuring costs previously discussed,
GAAP non-interest expense totaled $45.4
million in the most recent quarter. Full time
equivalent staff totaled 1,050 at quarter-end, compared to 939 at
the start of the quarter. During the first quarter,
Berkshire consolidated two of the
acquired New York branches which had overlap with existing
locations. Additionally, two other branches have been
consolidated in 2014 as part of the expense restructuring
program. The effective income tax rate was 29% in the most
recent quarter, unchanged from the effective rate for the year
2013.
CONFERENCE CALL
Berkshire will conduct a
conference call/webcast at 10:00 a.m.
eastern time on Tuesday, April 29,
2014 to discuss the results for the quarter and provide
guidance about expected future results. Participants should dial-in
to the call a few minutes before it begins. Information about the
conference call follows:
Dial-in:
|
888-317-6003
|
Elite Entry
Number:
|
0011655
|
Webcast:
|
berkshirebank.com
(investor relations link)
|
A PDF version of this earnings release is available at the above
link. A telephone replay of the call will be available
through Wednesday, May 7, 2014 by
calling 877-344-7529 and entering conference number: 10043772. The
webcast will be available at Berkshire's website above for an extended
period of time.
BACKGROUND
Berkshire Hills Bancorp is the parent of Berkshire Bank –
America's Most Exciting Bank®. The Company has
$6.0 billion in assets and 90 full
service branch offices in Massachusetts, New
York, Connecticut, and
Vermont providing personal and
business banking, insurance, and wealth management
services.
FORWARD LOOKING STATEMENTS
This document contains forward-looking statements as defined in
the Private Securities Litigation Reform Act of 1995. There
are several factors that could cause actual results to differ
significantly from expectations described in the forward-looking
statements. For a discussion of such factors, please see
Berkshire's most recent report on
Form 10-K filed with the Securities and Exchange Commission and
available on the SEC's website at www.sec.gov. Berkshire does not undertake any obligation to
update forward-looking statements.
OUT OF PERIOD ADJUSTMENT
In the first quarter of 2014, the Company recorded a correction
of an error to reduce interest income by $1.4 million representing interest income
previously recorded on loans acquired in prior years. After
evaluating the quantitative and qualitative aspects of these
adjustments, the Company concluded that its prior period financial
statements were not materially misstated and, therefore, no
restatement was required.
NON-GAAP FINANCIAL MEASURES
This document contains certain non-GAAP financial measures in
addition to results presented in accordance with Generally Accepted
Accounting Principles ("GAAP"). These non-GAAP measures
provide supplemental perspectives on operating results, performance
trends, and financial condition. They are not a substitute
for GAAP measures; they should be read and used in conjunction with
the Company's GAAP financial information. A reconciliation of
non-GAAP financial measures to GAAP measures is included in the
accompanying financial tables. In all cases, it should be
understood that non-GAAP per share measures do not depict amounts
that accrue directly to the benefit of shareholders. The
Company utilizes the non-GAAP measure of core earnings in
evaluating operating trends, including components for core revenue
and expense. These measures exclude amounts which the Company
views as unrelated to its normalized operations, including
securities gains/losses, losses recorded for hedge terminations,
merger costs, restructuring costs, systems conversion costs, and
out-of-period adjustments. Non-core adjustments are presented
net of estimated income tax expense or benefit. Similarly,
the efficiency ratio is also adjusted for these non-core items and
for tax preference items. The Company also adjusts certain
equity related measures to exclude intangible assets due to the
importance of these measures to the investment community.
Charges related to merger and acquisition activity consist
primarily of severance/benefit related expenses, contract
termination costs, and professional fees. Systems conversion
costs relate primarily to the Company's core systems conversion and
systems conversions costs in conjunction with this which have been
recorded in recent periods. Restructuring costs primarily
consist of employee severance costs and costs and losses associated
with the disposition of assets which were undertaken as a project
to right-size expenses following a decline in revenue in
2013. Out-of-period accounting adjustments for interest
income on acquired loans were recorded following systems
conversions and merger related accounting activity and were deemed
non-core. Non-core expenses include variable rate
compensation related to non-core items. The Company evaluates
GAAP, core, and non-core items to analyze its effective tax rate
and to arrive at core income that is net of an effective core tax
rate which is consistent with its analysis of expected core tax
items for the year.
CONTACTS
Investor Relations Contact
Allison O'Rourke, Vice President - Investor
Relations; 413-236-3149
Media Contact
Ray
Smith, Assistant Vice President - Marketing;
413-236-3756
BERKSHIRE HILLS
BANCORP, INC.
|
CONSOLIDATED
BALANCE SHEETS - UNAUDITED - (F-1)
|
|
|
|
March 31,
|
|
December
31,
|
|
(In
thousands)
|
2014
|
|
2013
|
|
Assets
|
|
|
|
|
Cash and due from
banks
|
$
60,023
|
|
$
56,841
|
|
Short-term
investments
|
12,650
|
|
18,698
|
|
Total cash and
short-term investments
|
72,673
|
|
75,539
|
|
|
|
|
|
|
Trading
security
|
14,923
|
|
14,840
|
|
Securities available
for sale, at fair value
|
1,033,637
|
|
760,048
|
|
Securities held to
maturity, at amortized cost
|
43,159
|
|
44,921
|
|
Federal Home Loan
Bank stock and other restricted securities
|
53,124
|
|
50,282
|
|
Total
securities
|
1,144,843
|
|
870,091
|
|
|
|
|
|
|
Loans held for sale,
at fair value
|
7,669
|
|
15,840
|
|
|
|
|
|
|
Residential
mortgages
|
1,377,771
|
|
1,384,274
|
|
Commercial real
estate
|
1,456,976
|
|
1,417,120
|
|
Commercial and
industrial loans
|
696,895
|
|
687,293
|
|
Consumer
loans
|
710,985
|
|
691,836
|
|
Total
loans
|
4,242,627
|
|
4,180,523
|
|
Less: Allowance for
loan losses
|
(33,602)
|
|
(33,323)
|
|
Net loans
|
4,209,025
|
|
4,147,200
|
|
|
|
|
|
|
Premises and
equipment, net
|
87,805
|
|
84,459
|
|
Other real estate
owned
|
2,418
|
|
2,758
|
|
Goodwill
|
264,770
|
|
256,871
|
|
Other intangible
assets
|
15,035
|
|
13,791
|
|
Cash surrender value
of bank-owned life insurance
|
102,343
|
|
101,530
|
|
Deferred tax asset,
net
|
40,202
|
|
50,711
|
|
Other
assets
|
63,548
|
|
54,009
|
|
Total
assets
|
$
6,010,331
|
|
$
5,672,799
|
|
|
|
|
|
|
Liabilities and
stockholders' equity
|
|
|
|
|
Demand
deposits
|
$
770,841
|
|
$
677,917
|
|
NOW
deposits
|
434,833
|
|
353,612
|
|
Money market
deposits
|
1,459,062
|
|
1,383,856
|
|
Savings
deposits
|
478,107
|
|
431,496
|
|
Time
deposits
|
1,075,740
|
|
1,001,648
|
|
Total
deposits
|
4,218,583
|
|
3,848,529
|
|
|
|
|
|
|
Senior
borrowings
|
936,747
|
|
974,428
|
|
Subordinated
borrowings
|
89,696
|
|
89,679
|
|
Total
borrowings
|
1,026,443
|
|
1,064,107
|
|
|
|
|
|
|
Other
liabilities
|
87,715
|
|
82,101
|
|
Total
liabilities
|
5,332,741
|
|
4,994,737
|
|
|
|
|
|
|
Total stockholders'
equity
|
677,590
|
|
678,062
|
|
Total liabilities and
stockholders' equity
|
$
6,010,331
|
|
$
5,672,799
|
|
|
|
|
|
|
(1) The Company
acquired 20 branches in Central New York on January 17, 2014,
including $440 million in deposits
|
and $4 million in
loans from the branch acquisition as of that date.
|
BERKSHIRE HILLS
BANCORP, INC.
|
CONSOLIDATED LOAN
& DEPOSIT ANALYSIS - UNAUDITED - (F-2)
|
|
LOAN
ANALYSIS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Annualized growth
%
|
(Dollars in
millions)
|
|
Mar. 31, 2014
Balance
|
|
|
|
Dec. 31, 2013
Balance
|
|
Quarter ended
March 31, 2014
|
|
|
|
|
|
|
|
|
|
|
Total residential
mortgages
|
|
$
1,378
|
|
|
|
$
1,384
|
|
(2)
|
%
|
|
|
|
|
|
|
|
|
|
|
Total commercial real
estate
|
|
1,457
|
|
|
|
1,417
|
|
11
|
|
Total commercial and
industrial loans
|
|
697
|
|
|
|
688
|
|
5
|
|
Total commercial
loans
|
|
2,154
|
|
|
|
2,105
|
|
9
|
|
|
|
|
|
|
|
|
|
|
|
Home
equity
|
|
305
|
|
|
|
307
|
|
(3)
|
|
Auto and
other
|
|
406
|
|
|
|
385
|
|
22
|
|
Total consumer
loans
|
|
711
|
|
|
|
692
|
|
11
|
|
Total
loans
|
|
$
4,243
|
|
|
|
$
4,181
|
|
6
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
DEPOSIT
ANALYSIS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Annualized growth
%
|
(Dollars in
millions)
|
|
Mar. 31, 2014
Balance
|
|
Branch
Acquisition
Balance
|
|
Dec. 31, 2013
Balance
|
|
Quarter ended
March 31, 2014
|
Demand
|
|
$
771
|
|
$
110
|
|
$
678
|
|
55
|
%
|
NOW
|
|
435
|
|
80
|
|
354
|
|
92
|
|
Money
market
|
|
1,459
|
|
124
|
|
1,384
|
|
22
|
|
Savings
|
|
478
|
|
36
|
|
431
|
|
44
|
|
Total non-maturity
deposits
|
|
3,143
|
|
350
|
|
2,847
|
|
42
|
|
|
|
|
|
|
|
|
|
|
|
Total time
deposits
|
|
1,076
|
|
90
|
|
1,002
|
|
30
|
|
Total
deposits
|
|
$
4,219
|
|
$
440
|
|
$
3,849
|
|
38
|
%
|
|
|
|
|
|
|
|
|
|
|
(1) The Company
acquired 20 branches in Central New York on January 17, 2014,
including $440 million in deposits,
|
as shown above,
and $4 million in loans from the branch acquisition as of that
date.
|
BERKSHIRE HILLS
BANCORP, INC.
|
CONSOLIDATED
STATEMENTS OF OPERATIONS - UNAUDITED - (F-3)
|
|
|
|
Three Months
Ended
|
|
|
March 31,
|
|
(In thousands,
except per share data)
|
2014
|
|
2013
|
|
Interest and
dividend income
|
|
|
|
|
Loans
|
$ 42,494
|
|
$ 47,081
|
|
Securities and
other
|
7,301
|
|
3,800
|
|
Total interest and
dividend income
|
49,795
|
|
50,881
|
|
Interest
expense
|
|
|
|
|
Deposits
|
4,721
|
|
5,363
|
|
Borrowings
|
2,308
|
|
3,581
|
|
Total interest
expense
|
7,029
|
|
8,944
|
|
Net interest
income
|
42,766
|
|
41,937
|
|
Non-interest
income
|
|
|
|
|
Loan related
fees
|
1,248
|
|
2,717
|
|
Mortgage banking
fees
|
372
|
|
2,217
|
|
Deposit related
fees
|
5,439
|
|
4,259
|
|
Insurance commissions
and fees
|
3,049
|
|
2,997
|
|
Wealth management
fees
|
2,549
|
|
2,264
|
|
Total fee
income
|
12,657
|
|
14,454
|
|
Other
|
524
|
|
344
|
|
Gain on sale of
securities, net
|
34
|
|
-
|
|
Loss on termination
of hedges
|
(8,792)
|
|
-
|
|
Total non-interest
income
|
4,423
|
|
14,798
|
|
Total net
revenue
|
47,189
|
|
56,735
|
|
Provision for loan
losses
|
3,396
|
|
2,400
|
|
Non-interest
expense
|
|
|
|
|
Compensation and
benefits
|
19,859
|
|
17,741
|
|
Occupancy and
equipment
|
6,814
|
|
5,768
|
|
Technology and
communications
|
3,778
|
|
2,991
|
|
Marketing and
promotion
|
521
|
|
638
|
|
Professional
services
|
1,152
|
|
1,490
|
|
FDIC premiums and
assessments
|
1,009
|
|
828
|
|
Other real estate
owned and foreclosures
|
523
|
|
23
|
|
Amortization of
intangible assets
|
1,306
|
|
1,377
|
|
Merger, restructuring
and conversion expenses
|
6,301
|
|
5,064
|
|
Other
|
4,097
|
|
3,563
|
|
Total non-interest
expense
|
45,360
|
|
39,483
|
|
|
|
|
|
|
(Loss) income before
income taxes
|
(1,567)
|
|
14,852
|
|
Income tax (benefit)
expense
|
(461)
|
|
4,387
|
|
Net (loss)
income
|
$ (1,106)
|
|
$ 10,465
|
|
|
|
|
|
|
Basic and diluted
(loss) earnings per share:
|
$
(0.04)
|
|
$
0.42
|
|
|
|
|
|
|
Weighted average
shares
outstanding:
|
|
|
|
|
Basic
|
24,698
|
|
24,948
|
|
Diluted
|
24,698
|
|
25,143
|
|
|
|
|
|
|
(1) The Company
acquired 20 branches in Central New York on January 17, 2014. The
income statement for the
|
three months ended
March 31, 2014 includes operations of the branch acquisition
beginning on that date.
|
(2) Merger,
restructuring and conversion expenses include acquisition related
expenses.
|
BERKSHIRE HILLS
BANCORP, INC.
|
CONSOLIDATED
STATEMENTS OF OPERATIONS - UNAUDITED - (F-4)
|
|
Quarters
Ended
|
|
|
|
|
Mar. 31,
|
|
Dec. 31,
|
|
Sept. 30,
|
|
June 30,
|
|
Mar. 31,
|
|
(In thousands,
except per share data)
|
2014
|
|
2013
|
|
2013
|
|
2013
|
|
2013
|
|
Interest and
dividend income
|
|
|
|
|
|
|
|
|
|
|
Loans
|
$ 42,494
|
|
$ 43,566
|
|
$ 50,025
|
|
$ 45,443
|
|
$ 47,081
|
|
Securities and
other
|
7,301
|
|
5,093
|
|
4,479
|
|
4,254
|
|
3,800
|
|
Total interest and
dividend income
|
49,795
|
|
48,659
|
|
54,504
|
|
49,697
|
|
50,881
|
|
Interest
expense
|
|
|
|
|
|
|
|
|
|
|
Deposits
|
4,721
|
|
5,166
|
|
5,278
|
|
5,052
|
|
5,363
|
|
Borrowings
|
2,308
|
|
3,651
|
|
3,357
|
|
3,541
|
|
3,581
|
|
Total interest
expense
|
7,029
|
|
8,817
|
|
8,635
|
|
8,593
|
|
8,944
|
|
Net interest
income
|
42,766
|
|
39,842
|
|
45,869
|
|
41,104
|
|
41,937
|
|
Non-interest
income
|
|
|
|
|
|
|
|
|
|
|
Loan related
fees
|
1,248
|
|
1,578
|
|
1,308
|
|
2,644
|
|
2,717
|
|
Mortgage banking
fees
|
372
|
|
445
|
|
444
|
|
2,129
|
|
2,217
|
|
Deposit related
fees
|
5,439
|
|
4,717
|
|
4,559
|
|
4,805
|
|
4,259
|
|
Insurance commissions
and fees
|
3,049
|
|
2,143
|
|
2,473
|
|
2,407
|
|
2,997
|
|
Wealth management
fees
|
2,549
|
|
2,212
|
|
2,137
|
|
2,070
|
|
2,264
|
|
Total fee
income
|
12,657
|
|
11,095
|
|
10,921
|
|
14,055
|
|
14,454
|
|
Other
|
524
|
|
1,227
|
|
832
|
|
546
|
|
344
|
|
Gain on sale of
securities, net
|
34
|
|
3,392
|
|
361
|
|
1,005
|
|
-
|
|
Loss on termination
of hedges
|
(8,792)
|
|
-
|
|
-
|
|
-
|
|
-
|
|
Total non-interest
income
|
4,423
|
|
15,714
|
|
12,114
|
|
15,606
|
|
14,798
|
|
Total net
revenue
|
47,189
|
|
55,556
|
|
57,983
|
|
56,710
|
|
56,735
|
|
Provision for loan
losses
|
3,396
|
|
3,100
|
|
3,178
|
|
2,700
|
|
2,400
|
|
Non-interest
expense
|
|
|
|
|
|
|
|
|
|
|
Compensation and
benefits
|
19,859
|
|
16,736
|
|
18,506
|
|
18,151
|
|
17,741
|
|
Occupancy and
equipment
|
6,814
|
|
5,421
|
|
5,614
|
|
5,737
|
|
5,768
|
|
Technology and
communications
|
3,778
|
|
3,169
|
|
3,304
|
|
3,480
|
|
2,991
|
|
Marketing and
promotion
|
521
|
|
765
|
|
590
|
|
603
|
|
638
|
|
Professional
services
|
1,152
|
|
1,558
|
|
1,757
|
|
1,764
|
|
1,490
|
|
FDIC premiums and
assessments
|
1,009
|
|
899
|
|
856
|
|
890
|
|
828
|
|
Other real estate
owned and foreclosures
|
523
|
|
255
|
|
138
|
|
284
|
|
23
|
|
Amortization of
intangible assets
|
1,306
|
|
1,239
|
|
1,307
|
|
1,345
|
|
1,377
|
|
Merger, restructuring
and conversion expenses
|
6,301
|
|
2,493
|
|
6,516
|
|
775
|
|
5,064
|
|
Other
|
4,097
|
|
4,622
|
|
4,196
|
|
4,906
|
|
3,563
|
|
Total non-interest
expense
|
45,360
|
|
37,157
|
|
42,784
|
|
37,935
|
|
39,483
|
|
|
|
|
|
|
|
|
|
|
|
|
(Loss) income before
income taxes
|
(1,567)
|
|
15,299
|
|
12,021
|
|
16,075
|
|
14,852
|
|
Income tax (benefit)
expense
|
(461)
|
|
4,762
|
|
3,917
|
|
4,038
|
|
4,387
|
|
Net (loss)
income
|
$ (1,106)
|
|
$ 10,537
|
|
$
8,104
|
|
$ 12,037
|
|
$ 10,465
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Loss) earnings
per share:
|
|
|
|
|
|
|
|
|
|
|
Basic
|
$
(0.04)
|
|
$
0.43
|
|
$
0.33
|
|
$
0.49
|
|
$
0.42
|
|
Diluted
|
$
(0.04)
|
|
$
0.42
|
|
$
0.33
|
|
$
0.48
|
|
$
0.42
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
shares
outstanding:
|
|
|
|
|
|
|
|
|
|
|
Basic
|
24,698
|
|
24,701
|
|
24,748
|
|
24,779
|
|
24,948
|
|
Diluted
|
24,698
|
|
24,857
|
|
24,873
|
|
24,956
|
|
25,143
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) See notes on Page
F-3
|
|
|
|
|
|
|
|
|
|
|
BERKSHIRE HILLS
BANCORP, INC.
|
ASSET QUALITY
ANALYSIS - (F-5)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At or for the
Quarters Ended
|
|
|
|
Mar. 31,
|
|
Dec. 31,
|
|
Sept. 30,
|
|
June 30,
|
|
Mar. 31,
|
|
(Dollars in
thousands)
|
|
|
2014
|
|
2013
|
|
2013
|
|
2013
|
|
2013
|
|
NON-PERFORMING
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-accruing
loans:
|
|
|
|
|
|
|
|
|
|
|
|
|
Residential
mortgages
|
|
|
$
6,071
|
|
$
7,867
|
|
$
8,487
|
|
$
5,945
|
|
$
8,818
|
|
Commercial real
estate
|
|
|
13,036
|
|
13,739
|
|
13,800
|
|
14,948
|
|
12,396
|
|
Commercial and
industrial loans
|
|
|
2,411
|
|
2,356
|
|
2,753
|
|
3,481
|
|
3,519
|
|
Consumer
loans
|
|
|
3,846
|
|
3,493
|
|
3,227
|
|
2,405
|
|
2,325
|
|
Total non-accruing
loans
|
|
|
25,364
|
|
27,455
|
|
28,267
|
|
26,779
|
|
27,058
|
|
Other real estate
owned
|
|
|
2,418
|
|
2,758
|
|
3,561
|
|
2,713
|
|
2,513
|
|
Total non-performing
assets
|
|
|
$ 27,782
|
|
$ 30,213
|
|
$ 31,828
|
|
$ 29,492
|
|
$ 29,571
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total non-accruing
loans/total loans
|
|
|
0.60%
|
|
0.66%
|
|
0.70%
|
|
0.69%
|
|
0.70%
|
|
Total non-performing
assets/total assets
|
|
|
0.46%
|
|
0.53%
|
|
0.58%
|
|
0.56%
|
|
0.56%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
PROVISION AND
ALLOWANCE FOR LOAN LOSSES
|
|
|
|
|
|
|
|
|
|
|
Balance at beginning
of period
|
|
|
$ 33,323
|
|
$ 33,248
|
|
$ 33,248
|
|
$ 33,263
|
|
$ 33,208
|
|
Charged-off
loans
|
|
|
(3,317)
|
|
(3,462)
|
|
(3,417)
|
|
(3,457)
|
|
(2,501)
|
|
Recoveries on
charged-off loans
|
|
|
200
|
|
437
|
|
239
|
|
742
|
|
156
|
|
Net loans
charged-off
|
|
|
(3,117)
|
|
(3,025)
|
|
(3,178)
|
|
(2,715)
|
|
(2,345)
|
|
Provision for loan
losses
|
|
|
3,396
|
|
3,100
|
|
3,178
|
|
2,700
|
|
2,400
|
|
Balance at end of
period
|
|
|
$ 33,602
|
|
$ 33,323
|
|
$ 33,248
|
|
$ 33,248
|
|
$ 33,263
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Allowance for loan
losses/total loans
|
|
|
0.79%
|
|
0.80%
|
|
0.83%
|
|
0.86%
|
|
0.86%
|
|
Allowance for loan
losses/non-accruing loans
|
|
|
132%
|
|
121%
|
|
118%
|
|
124%
|
|
123%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NET LOAN
CHARGE-OFFS
|
|
|
|
|
|
|
|
|
|
|
|
|
Residential
mortgages
|
|
|
$ (1,055)
|
|
$
(564)
|
|
$
(351)
|
|
$
(852)
|
|
$
(260)
|
|
Commercial real
estate
|
|
|
(1,105)
|
|
(763)
|
|
(1,480)
|
|
(1,283)
|
|
(952)
|
|
Commercial and
industrial loans
|
|
|
(215)
|
|
(1,042)
|
|
(940)
|
|
(93)
|
|
(631)
|
|
Home
equity
|
|
|
(458)
|
|
45
|
|
(174)
|
|
(121)
|
|
(199)
|
|
Auto and other
consumer
|
|
|
(284)
|
|
(701)
|
|
(233)
|
|
(366)
|
|
(303)
|
|
Total, net
|
|
|
$ (3,117)
|
|
$ (3,025)
|
|
$ (3,178)
|
|
$ (2,715)
|
|
$ (2,345)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net charge-offs (QTD
annualized)/average loans
|
|
0.30%
|
|
0.31%
|
|
0.32%
|
|
0.27%
|
|
0.23%
|
|
Net charge-offs (YTD
annualized)/average loans
|
|
0.30%
|
|
0.29%
|
|
0.28%
|
|
0.26%
|
|
0.23%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
DELINQUENT AND
NON-ACCRUING LOANS/TOTAL LOANS
|
|
|
|
|
|
|
|
|
|
30-89 Days
delinquent
|
|
|
0.37%
|
|
0.51%
|
|
0.42%
|
|
0.70%
|
|
0.61%
|
|
90+ Days delinquent
and still accruing
|
|
|
0.22%
|
|
0.22%
|
|
0.29%
|
|
0.40%
|
|
0.47%
|
|
Total accruing
delinquent loans
|
|
|
0.59%
|
|
0.73%
|
|
0.71%
|
|
1.10%
|
|
1.08%
|
|
Non-accruing
loans
|
|
|
0.60%
|
|
0.66%
|
|
0.70%
|
|
0.69%
|
|
0.70%
|
|
Total delinquent and
non-accruing loans
|
|
|
1.19%
|
|
1.39%
|
|
1.41%
|
|
1.79%
|
|
1.78%
|
|
BERKSHIRE HILLS
BANCORP, INC.
|
SELECTED FINANCIAL
HIGHLIGHTS - (F-6)
|
|
|
|
|
|
|
|
|
|
At or for the
Quarters Ended
|
|
|
|
|
Mar. 31,
|
|
Dec. 31,
|
|
Sept. 30,
|
|
June 30,
|
|
Mar. 31,
|
|
|
|
|
|
2014
|
|
2013
|
|
2013
|
|
2013
|
|
2013
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
PER SHARE
DATA
|
|
|
|
|
|
|
|
|
|
|
|
|
Core earnings,
diluted
|
$
0.42
|
|
$
0.40
|
|
$
0.43
|
|
$
0.48
|
|
$
0.54
|
|
|
|
Net earnings,
diluted
|
(0.04)
|
|
0.42
|
|
0.33
|
|
0.48
|
|
0.42
|
|
|
|
Tangible book
value
|
15.84
|
|
16.27
|
|
16.08
|
|
15.96
|
|
15.87
|
|
|
|
Total book
value
|
26.99
|
|
27.08
|
|
26.98
|
|
26.82
|
|
26.68
|
|
|
|
Market price at
period end
|
25.88
|
|
27.27
|
|
25.11
|
|
27.76
|
|
25.54
|
|
|
|
Dividends
|
|
0.18
|
|
0.18
|
|
0.18
|
|
0.18
|
|
0.18
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
PERFORMANCE
RATIOS
|
|
|
|
|
|
|
|
|
|
|
|
|
Core return on
assets
|
0.71
|
%
|
0.73
|
%
|
0.81
|
%
|
0.92
|
%
|
1.03
|
%
|
|
|
Return on
assets
|
(0.08)
|
|
0.77
|
|
0.61
|
|
0.93
|
|
0.80
|
|
|
|
Core return on
equity
|
6.02
|
|
5.87
|
|
6.29
|
|
7.13
|
|
8.10
|
|
|
|
Core return on
tangible equity
|
10.84
|
|
10.47
|
|
11.18
|
|
12.84
|
|
14.57
|
|
|
|
Return on
equity
|
(0.64)
|
|
6.18
|
|
4.74
|
|
7.21
|
|
6.28
|
|
|
|
Net interest margin,
fully taxable equivalent
|
3.35
|
|
3.26
|
|
3.93
|
|
3.63
|
|
3.73
|
|
|
|
Fee income/Net
interest and fee income
|
22.84
|
|
21.78
|
|
19.23
|
|
25.48
|
|
25.63
|
|
|
|
Efficiency
ratio
|
64.42
|
|
63.21
|
|
60.98
|
|
63.05
|
|
57.14
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GROWTH
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total commercial
loans, year-to-date (annualized)
|
9
|
%
|
5
|
%
|
1
|
%
|
(2)
|
%
|
0
|
%
|
|
|
Total loans,
year-to-date (annualized)
|
6
|
|
5
|
|
1
|
|
(6)
|
|
(10)
|
|
|
|
Total deposits,
year-to-date (annualized)
|
38
|
|
(6)
|
|
(7)
|
|
(14)
|
|
0
|
|
|
|
Total net revenues,
year-to-date, compared to prior year
|
(17)
|
|
15
|
|
24
|
|
28
|
|
39
|
|
|
|
Earnings per share,
year-to-date, compared to prior year
|
(110)
|
|
11
|
|
11
|
|
40
|
|
50
|
|
|
|
Core earnings per
share, year-to-date, compared to prior year
|
(22)
|
|
(6)
|
|
3
|
|
11
|
|
20
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FINANCIAL
DATA (In millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
assets
|
|
$ 6,010
|
|
$ 5,673
|
|
$ 5,450
|
|
$ 5,224
|
|
$ 5,245
|
|
|
|
Total earning
assets
|
5,408
|
|
5,085
|
|
4,856
|
|
4,629
|
|
4,646
|
|
|
|
Total
loans
|
|
4,243
|
|
4,181
|
|
4,024
|
|
3,871
|
|
3,889
|
|
|
|
Allowance for loan
losses
|
34
|
|
33
|
|
33
|
|
33
|
|
33
|
|
|
|
Total intangible
assets
|
280
|
|
271
|
|
272
|
|
272
|
|
273
|
|
|
|
Total
deposits
|
|
4,219
|
|
3,849
|
|
3,882
|
|
3,815
|
|
4,101
|
|
|
|
Total stockholders'
equity
|
678
|
|
678
|
|
673
|
|
673
|
|
674
|
|
|
|
Total core
income
|
10.4
|
|
10.0
|
|
10.7
|
|
11.9
|
|
13.5
|
|
|
|
Total net
income
|
(1.1)
|
|
10.5
|
|
8.1
|
|
12.0
|
|
10.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ASSET QUALITY
RATIOS
|
|
|
|
|
|
|
|
|
|
|
|
|
Net charge-offs
(current quarter annualized)/average loans
|
0.30
|
%
|
0.31
|
%
|
0.32
|
%
|
0.27
|
%
|
0.23
|
%
|
|
|
Allowance for loan
losses/total loans
|
0.79
|
|
0.80
|
|
0.83
|
|
0.86
|
|
0.86
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CONDITION
RATIOS
|
|
|
|
|
|
|
|
|
|
|
|
|
Stockholders' equity
to total assets
|
11.27
|
%
|
11.95
|
%
|
12.35
|
%
|
12.88
|
%
|
12.85
|
%
|
|
|
Tangible
stockholders' equity to tangible assets
|
6.94
|
|
7.54
|
|
7.74
|
|
8.10
|
|
8.06
|
|
|
|
Investments to total
assets
|
19.05
|
|
15.34
|
|
14.48
|
|
12.85
|
|
12.65
|
|
|
|
Loans/deposits
|
|
101
|
|
109
|
|
104
|
|
101
|
|
95
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Reconciliation of
Non-GAAP financial measures, including all references to core and
tangible amounts, appear on page F-9.
|
|
|
Tangible assets are
total assets less total intangible assets.
|
|
(2)
|
All performance
ratios are annualized and are based on average balance sheet
amounts, where applicable.
|
|
(3)
|
See note on Page F-9
on tangible equity.
|
BERKSHIRE HILLS
BANCORP, INC.
|
|
AVERAGE BALANCES -
(F-7)
|
|
|
|
|
|
Quarters
Ended
|
|
|
Mar.
31,
|
|
Dec.
31,
|
|
Sept.
30,
|
|
June
30,
|
|
Mar.
31,
|
|
(In
thousands)
|
2014
|
|
2013
|
|
2013
|
|
2013
|
|
2013
|
|
Assets
|
|
|
|
|
|
|
|
|
|
|
Loans:
|
|
|
|
|
|
|
|
|
|
|
Residential
mortgages
|
$
1,379,266
|
|
$
1,330,674
|
|
$
1,247,661
|
|
$
1,218,192
|
|
$
1,290,989
|
|
Commercial real
estate
|
1,420,382
|
|
1,381,628
|
|
1,353,923
|
|
1,381,755
|
|
1,406,628
|
|
Commercial and
industrial loans
|
684,776
|
|
673,292
|
|
647,939
|
|
627,591
|
|
601,695
|
|
Consumer
loans
|
699,598
|
|
687,540
|
|
651,565
|
|
634,715
|
|
644,674
|
|
Total
loans
|
4,184,022
|
|
4,073,134
|
|
3,901,088
|
|
3,862,253
|
|
3,943,986
|
|
Securities
|
1,047,658
|
|
813,417
|
|
735,307
|
|
655,396
|
|
591,304
|
|
Short-term
investments and loans held for sale
|
28,631
|
|
35,438
|
|
60,820
|
|
90,680
|
|
98,160
|
|
Total earning
assets
|
5,260,311
|
|
4,921,989
|
|
4,697,215
|
|
4,608,329
|
|
4,633,450
|
|
Goodwill and other
intangible assets
|
278,386
|
|
271,147
|
|
271,670
|
|
272,421
|
|
273,428
|
|
Other
assets
|
312,145
|
|
305,617
|
|
317,722
|
|
317,856
|
|
333,485
|
|
Total
assets
|
$
5,850,842
|
|
$
5,498,753
|
|
$
5,286,607
|
|
$
5,198,606
|
|
$
5,240,363
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities and
stockholders' equity
|
|
|
|
|
|
|
|
|
|
|
Deposits:
|
|
|
|
|
|
|
|
|
|
|
NOW
|
$
409,631
|
|
$
348,600
|
|
$
345,682
|
|
$
358,255
|
|
$
368,392
|
|
Money
market
|
1,490,408
|
|
1,392,570
|
|
1,329,591
|
|
1,358,590
|
|
1,477,497
|
|
Savings
|
463,615
|
|
435,766
|
|
442,408
|
|
449,296
|
|
441,547
|
|
Time
|
1,069,987
|
|
1,044,850
|
|
1,064,199
|
|
1,087,357
|
|
1,148,345
|
|
Total
interest-bearing deposits
|
3,433,641
|
|
3,221,786
|
|
3,181,880
|
|
3,253,498
|
|
3,435,781
|
|
Borrowings
|
899,458
|
|
857,848
|
|
708,798
|
|
574,822
|
|
423,739
|
|
Total
interest-bearing liabilities
|
4,333,099
|
|
4,079,634
|
|
3,890,678
|
|
3,828,320
|
|
3,859,520
|
|
Non-interest-bearing
demand deposits
|
749,982
|
|
681,368
|
|
658,568
|
|
636,469
|
|
645,923
|
|
Other
liabilities
|
76,258
|
|
56,261
|
|
52,874
|
|
65,568
|
|
68,509
|
|
Total
liabilities
|
5,159,339
|
|
4,817,263
|
|
4,602,120
|
|
4,530,357
|
|
4,573,952
|
|
|
|
|
|
|
|
|
|
|
|
|
Total stockholders'
equity
|
691,503
|
|
681,490
|
|
684,487
|
|
668,249
|
|
666,411
|
|
|
|
|
|
|
|
|
|
|
|
|
Total liabilities and
stockholders' equity
|
$
5,850,842
|
|
$
5,498,753
|
|
$
5,286,607
|
|
$
5,198,606
|
|
$
5,240,363
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Supplementary
data
|
|
|
|
|
|
|
|
|
|
|
Total non-maturity
deposits
|
$
3,113,636
|
|
$
2,858,304
|
|
$
2,776,249
|
|
$
2,802,610
|
|
$
2,933,359
|
|
Total
deposits
|
4,183,623
|
|
3,903,154
|
|
3,840,448
|
|
3,889,967
|
|
4,081,704
|
|
Fully taxable
equivalent income adjustment
|
718
|
|
639
|
|
652
|
|
644
|
|
629
|
|
Total average
tangible equity
|
413,117
|
|
410,343
|
|
412,817
|
|
395,828
|
|
392,983
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Average balances
for securities available-for-sale are based on amortized
cost. Total loans include non-accruing loans.
|
(2) Total average
tangible equity results from the subtraction of average goodwill
and other intangible assets from total
average
|
stockholders'
equity.
|
(3) The average
balances of deposits include the deposits held for sale presented
under other liabilities on the consolidated balance
sheet.
|
BERKSHIRE HILLS
BANCORP, INC.
|
AVERAGE
YIELDS (Fully Taxable Equivalent - Annualized) -
(F-8)
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarters
Ended
|
|
Mar. 31,
|
|
Dec. 31,
|
|
Sept. 30,
|
|
June 30,
|
|
Mar. 31,
|
|
|
2014
|
|
2013
|
|
2013
|
|
2013
|
|
2013
|
|
|
|
|
|
|
|
|
|
|
|
|
Earning
assets
|
|
|
|
|
|
|
|
|
|
|
Loans:
|
|
|
|
|
|
|
|
|
|
|
Residential
mortgages
|
4.12
|
%
|
3.98
|
%
|
3.99
|
%
|
4.19
|
%
|
4.04
|
%
|
Commercial real
estate
|
4.44
|
|
4.73
|
|
5.80
|
|
5.27
|
|
5.45
|
|
Commercial and
industrial loans
|
3.97
|
|
3.91
|
|
6.09
|
|
4.04
|
|
4.40
|
|
Consumer
loans
|
3.56
|
|
4.01
|
|
4.39
|
|
4.78
|
|
4.94
|
|
Total
loans
|
4.13
|
|
4.26
|
|
5.02
|
|
4.67
|
|
4.75
|
|
Securities
|
3.04
|
|
2.72
|
|
2.77
|
|
3.00
|
|
3.04
|
|
Short-term
investments and loans held for sale
|
1.51
|
|
1.92
|
|
4.05
|
|
2.02
|
|
1.83
|
|
Total earning
assets
|
3.89
|
|
3.97
|
|
4.66
|
|
4.38
|
|
4.51
|
|
|
|
|
|
|
|
|
|
|
|
|
Funding
liabilities
|
|
|
|
|
|
|
|
|
|
|
Deposits:
|
|
|
|
|
|
|
|
|
|
|
NOW
|
0.15
|
|
0.18
|
|
0.18
|
|
0.26
|
|
0.29
|
|
Money
market
|
0.37
|
|
0.44
|
|
0.44
|
|
0.39
|
|
0.39
|
|
Savings
|
0.16
|
|
0.16
|
|
0.16
|
|
0.17
|
|
0.18
|
|
Time
|
1.15
|
|
1.25
|
|
1.29
|
|
1.23
|
|
1.23
|
|
Total
interest-bearing deposits
|
0.56
|
|
0.64
|
|
0.66
|
|
0.62
|
|
0.63
|
|
Borrowings
|
1.04
|
|
1.69
|
|
1.88
|
|
2.47
|
|
3.43
|
|
Total
interest-bearing liabilities
|
0.66
|
|
0.86
|
|
0.88
|
|
0.90
|
|
0.94
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest
spread
|
3.23
|
|
3.11
|
|
3.78
|
|
3.48
|
|
3.57
|
|
Net interest
margin
|
3.35
|
|
3.26
|
|
3.93
|
|
3.63
|
|
3.73
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of
funds
|
0.56
|
|
0.73
|
|
0.75
|
|
0.77
|
|
0.81
|
|
Cost of
deposits
|
0.46
|
|
0.53
|
|
0.55
|
|
0.52
|
|
0.53
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Cost of funds
includes all deposits and borrowings.
|
BERKSHIRE HILLS
BANCORP, INC.
|
|
RECONCILIATION OF
NON-GAAP FINANCIAL MEASURES - (F-9)
|
|
|
|
|
|
|
|
|
|
At or for the
Quarters Ended
|
|
|
|
Mar.
31,
|
|
Dec.
31,
|
|
Sept.
30,
|
|
June
30,
|
|
Mar.
31,
|
|
(Dollars in
thousands)
|
|
2014
|
|
2013
|
|
2013
|
|
2013
|
|
2013
|
|
Net
income
|
|
$ (1,106)
|
|
$ 10,537
|
|
$
8,104
|
|
$ 12,037
|
|
$ 10,465
|
|
Adj: Gain on sale of
securities, net
|
|
(34)
|
|
(3,392)
|
|
(361)
|
|
(1,005)
|
|
-
|
|
Adj: Loss on
termination of hedges
|
|
8,792
|
|
-
|
|
-
|
|
-
|
|
-
|
|
Adj: Merger and
acquisition expenses
|
|
3,637
|
|
932
|
|
1,307
|
|
775
|
|
4,984
|
|
Adj: Restructuring,
conversion and other expenses (5)
|
|
2,665
|
|
1,561
|
|
5,709
|
|
-
|
|
80
|
|
Adj: Out-of-period
adjustment (6)
|
|
1,381
|
|
-
|
|
(2,222)
|
|
-
|
|
-
|
|
Adj: Income
taxes
|
|
(4,923)
|
|
364
|
|
(1,788)
|
|
93
|
|
(2,042)
|
|
Total core
income
|
(A)
|
$ 10,412
|
|
$ 10,002
|
|
$ 10,749
|
|
$ 11,900
|
|
$ 13,487
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
revenue
|
|
$ 47,189
|
|
$ 55,556
|
|
$ 57,983
|
|
$ 56,710
|
|
$ 56,735
|
|
Adj: Gain on sale of
securities, net
|
|
(34)
|
|
(3,392)
|
|
(361)
|
|
(1,005)
|
|
-
|
|
Adj: Loss on
termination of hedges
|
|
8,792
|
|
-
|
|
-
|
|
-
|
|
-
|
|
Adj: Out-of-period
adjustment (6)
|
|
1,381
|
|
-
|
|
(2,222)
|
|
-
|
|
-
|
|
Total core
revenue
|
|
$ 57,328
|
|
$ 52,164
|
|
$ 55,400
|
|
$ 55,705
|
|
$ 56,735
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total non-interest
expense
|
|
$ 45,360
|
|
$ 37,157
|
|
$ 42,784
|
|
$ 37,935
|
|
$ 39,483
|
|
Less: Total non-core
expense (see above)
|
|
(6,302)
|
|
(2,493)
|
|
(7,016)
|
|
(775)
|
|
(5,064)
|
|
Core non-interest
expense
|
|
$ 39,058
|
|
$ 34,664
|
|
$ 35,768
|
|
$ 37,160
|
|
$ 34,419
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Dollars in
millions, except per share data)
|
|
|
|
|
|
|
|
|
|
|
|
Total average
assets
|
(B)
|
$
5,851
|
|
$
5,499
|
|
$
5,287
|
|
$
5,199
|
|
$
5,240
|
|
Total average
stockholders'
equity
|
(C)
|
692
|
|
681
|
|
684
|
|
668
|
|
666
|
|
Total average
tangible stockholders'
equity
|
(D)
|
413
|
|
410
|
|
413
|
|
396
|
|
393
|
|
Total tangible
stockholders' equity, period-end (7)
|
(E)
|
398
|
|
407
|
|
401
|
|
401
|
|
401
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total shares
outstanding, period-end
(thousands)
|
(F)
|
25,105
|
|
25,036
|
|
24,952
|
|
25,096
|
|
25,254
|
|
Average diluted
shares outstanding (thousands) (8)
|
(G)
|
24,833
|
|
24,857
|
|
24,873
|
|
24,956
|
|
25,143
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Core earnings per
share, diluted
|
(A/G)
|
$
0.42
|
|
$
0.40
|
|
$
0.43
|
|
$
0.48
|
|
$
0.54
|
|
Tangible book value
per share, period-end
|
(E/F)
|
$
15.84
|
|
$
16.27
|
|
$
16.08
|
|
$
15.96
|
|
$
15.87
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Core return on
assets
|
(A/B)
|
0.71
|
%
|
0.73
|
%
|
0.81
|
%
|
0.92
|
%
|
1.03
|
%
|
Core return on
equity
|
(A/C)
|
6.02
|
|
5.87
|
|
6.29
|
|
7.13
|
|
8.10
|
|
Core return on
tangible equity (4)
|
(A/D)
|
10.84
|
|
10.47
|
|
11.18
|
|
12.84
|
|
14.57
|
|
Efficiency ratio
(1)
|
|
64.42
|
|
63.21
|
|
60.98
|
|
63.05
|
|
57.14
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Supplementary
data
|
|
|
|
|
|
|
|
|
|
|
|
Tax credit benefit of
tax shelter investments
|
|
$
555
|
|
$
80
|
|
$
458
|
|
$
458
|
|
$
458
|
|
Intangible
amortization
|
|
$
1,306
|
|
$
1,239
|
|
$
1,307
|
|
$
1,345
|
|
$
1,377
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Efficiency ratio
is computed by dividing total core tangible non-interest expense by
the sum of total net interest income on a fully
|
taxable equivalent
basis and total core non-interest income adjusted to include tax
credit benefit of tax shelter investments.
The
|
Company uses this
non-GAAP measure to provide important information regarding its
operational efficiency.
|
|
|
|
|
|
|
|
|
|
|
|
|
(2) Ratios are
annualized and based on average balance sheet amounts, where
applicable.
|
|
|
|
|
|
|
|
|
|
|
|
|
(3) Quarterly data
may not sum to year-to-date data due to the out-of-period
adjustment recorded in the third quarter of 2013
|
and
rounding.
|
|
|
|
|
|
|
|
|
|
|
|
|
(4) Core return on
tangible equity is computed by dividing the total core income
adjusted for the tax-affected amortization of
|
intangible assets,
assuming a 40% marginal rate, by tangible equity.
|
|
|
|
|
|
|
|
|
|
|
|
|
(5) Prior period
variable compensation is shown above under restructuring,
conversion and other expenses.
|
|
|
|
|
|
|
|
|
|
|
|
|
(6) The out of period
adjustments shown above relate to interest income earned on loans
acquired in bank acquisitions.
|
|
|
|
|
|
|
|
|
|
|
|
|
(7) Total tangible
stockholders' equity is computed by taking total stockholders'
equity less the intangible assets at period-end.
|
|
|
|
|
|
|
|
|
|
|
|
|
(8) Average diluted
shares computed for core earnings per share differ from GAAP
average diluted shares due to the GAAP net loss compared to core
net
|
income for the
period.
|
Photo -
http://photos.prnewswire.com/prnh/20120131/NE44966LOGO
SOURCE Berkshire Hills Bancorp