PITTSFIELD, Mass.,
Oct. 26, 2015 /PRNewswire/ -- Berkshire Hills Bancorp,
Inc. (NYSE: BHLB) reported $0.54 in
core earnings per share in the third quarter of 2015, which was a
17% increase year over year and a 6% increase over the prior
quarter. GAAP EPS totaled $0.49
in the most recent quarter including net non-core acquisition
related charges. For the year-to-date, core EPS increased by
17% to $1.55 and GAAP EPS increased
by 33% to $1.20.
Berkshire completed the acquisition of Firestone
Financial, a commercial equipment finance company, on August 7, 2015.
THIRD QUARTER FINANCIAL HIGHLIGHTS (comparisons are to
prior quarter unless otherwise stated):
- 6% increase in core earnings per share compared to prior
quarter
- 14% annualized organic increase in loans
- 9% annualized organic increase in commercial loans
- 3% increase in deposits
- 3.37% net interest margin
- 60.4% efficiency ratio
- 0.86% core ROA (0.78% GAAP ROA)
- 0.31% non-performing assets/assets
- 0.26% net loan charge-offs/average loans
CEO Michael Daly stated, "We are
producing strong quarterly core EPS growth, including margin
expansion and core profitability improvement. We
continue to post solid organic loan growth while maintaining our
financial and risk management disciplines. Our team is
delivering on the promise of our franchise, and this was reflected
in our recent leadership promotions as we empower our leaders to
further expand our market presence and bottom line results."
Mr. Daly continued, "Berkshire
completed its acquisition and integration of Firestone Financial in
the most recent quarter. I am very pleased at the prospects
for increased scale and cross sales in Firestone's lending
markets. The third quarter was also our first complete
quarter with the integrated operations of our Springfield area team from Hampden Bancorp and
we are seeing financial and market benefits there. Our
growing SBA lending volume has positioned us as a leading regional
originator of SBA 7(a) loans to small businesses. In
the third quarter, we recruited a team leader for our auto lending
operation which is expanding across our region. I'm proud of
the growth in banking solutions that we are providing to our
markets."
Mr. Daly concluded, "Our shareholder base has grown as a result
of recent acquisitions and we are advancing our per share core
earnings and book value metrics this year even as we absorb the
costs of business expansion. Our business momentum is
continuing into the fourth quarter, including recent hires in
wealth management and private banking. We have enhanced our
America's Most Exciting Bank® branding throughout our
offices in support of our growing recognition as a preferred
financial partner in our region."
DIVIDEND DECLARED
The Board of Directors voted to declare a cash dividend of
$0.19 per share to shareholders of
record at the close of business on November
12, 2015, payable on November
25, 2015. This dividend equates to a 2.7% annualized
yield based on the $28.28 average
closing price of Berkshire's
common stock during the third quarter.
FINANCIAL CONDITION
Total assets increased in the most recent quarter by
$286 million, or 4%, to $7.8 billion based on strong loan growth
including the Firestone acquisition. This growth was funded
primarily by a $185 million increase
in deposits, together with the utilization of excess cash and a
$42 million benefit from the issuance
of common stock for Firestone merger consideration.
Total loans increased by $380
million, including $192
million in commercial loans acquired with Firestone.
Annualized organic loan growth was 14% based on contributions from
commercial loans and residential mortgages. Loan growth was
supported by strong originations, including the benefit of higher
mortgage applications in the prior quarter. Quarterly results
benefited from targeted reductions in lower margin balances.
The loans acquired with Firestone consist primarily of variable
rate equipment term loans to a diversified portfolio of national
commercial borrowers. Firestone continues to operate as a
subsidiary of Berkshire Bank. As of period-end, commercial
loans increased to 54% of total loans, reflecting Berkshire's focus on building profitable
commercial relationships.
Asset quality metrics remained favorable during the
quarter. Annualized net loan charge-offs measured 0.26% of
average loans and quarter-end non-performing assets measured 0.31%
of total assets. The loan loss allowance has increased by 7%
in 2015 as a result of organic loan growth. Pursuant to
accounting principles, no loan loss allowance was recorded for the
acquired Firestone loans.
Total deposits increased by 3% in the most recent quarter.
Growth was concentrated in time deposits as the Company
utilized promotions and brokered deposits to raise funds to replace
more costly borrowed funds previously used by Firestone. The
ratio of loans/deposits stood at 103% at the end of the
quarter.
Shareholders' equity increased by $54
million including the Firestone stock consideration
consisting of 1.442 million shares issued for the acquisition and
recorded at $29.20 per share based on
the closing price of Berkshire's
stock on August 6. Goodwill and intangible assets increased
by $16 million during the quarter due
to the Firestone acquisition, and the ratio of tangible equity to
assets increased to 7.3% from 7.0%. Total equity
similarly increased to 11.3% of assets from 11.0%.
Tangible book value per share increased to $17.61 from $17.16
during the quarter and total book value per share improved to
$28.48 from $28.02.
RESULTS OF OPERATIONS
Many categories of revenue and expense increased in the most
recent quarter due to the added Firestone operations as of August
7. The third quarter also was the first full quarter to
benefit from the integrated operations of Hampden Bank. The third quarter efficiency
ratio improved to 60.4% as a result of revenue driven positive
operating leverage. Berkshire's core ROA and core ROE increased
compared to the prior quarter and to the third quarter of
2014. Third quarter core return on tangible equity measured
12.8%, while GAAP ROE measured 6.9%.
Third quarter net interest income increased by $4.3 million, or 8%, compared to the prior
quarter due to higher loan interest income including the benefit of
organic growth. Before accretion, the net interest margin
increased to 3.22% from 3.16% in the prior quarter and the yield on
commercial loans increased to 4.21% from 3.93%. Purchased
loan accretion increased to $2.7
million from $2.2 million,
including unanticipated recoveries from impaired loans collected at
quarter-end. With accretion, the net interest margin improved
to 3.37% from 3.30%.
Fee income decreased quarter over quarter due to a decline from
high second quarter volumes of mortgage banking and commercial loan
swap activity spurred by a dip in long term interest rates in the
first half of the year. Total fee income related to deposits,
insurance, and wealth management was up slightly from the prior
quarter.
The $4.2 million loan loss
provision was unchanged in the third quarter compared to the prior
quarter, and contributed to growth in the allowance after absorbing
net charge-offs. Core non-interest expense increased by
$0.7 million due to the Firestone
acquisition, and was down before these costs. Total
annualized core expense decreased to 2.44% of average assets from
2.52% in the prior quarter. GAAP non-interest expense totaled
$49.4 million in the third quarter
compared to $54.0 million in the
prior quarter due to the Hampden merger costs recorded in the prior
quarter. Full time equivalent staff totaled 1,169 positions
at quarter-end including 51 positions added with
Firestone.
Berkshire's income tax rate on
core income was 17% in the most recent quarter, which was unchanged
from the prior quarter. Berkshire income tax benefited by $4.0 million from tax-advantaged commercial
development projects including both tax credits and tax deductions
on the $2.9 million investment
amortization included as a charge against non-interest
income. Berkshire's
tax rate on GAAP income was 8% in the most recent quarter and
reflected the tax benefit related to non-core Hampden merger
related charges recorded earlier in the year.
CONFERENCE CALL
Berkshire will conduct a
conference call/webcast at 10:00 a.m.
eastern time on Tuesday, October 27,
2015 to discuss the results for the quarter and provide
guidance about expected future results.
We encourage participants to pre-register for the conference
call using the following link: http://dpregister.com/10073969.
Callers who pre-register will be given dial-in instructions and
a unique PIN to gain immediate access to the call. Participants may
pre-register at any time prior to the call, and will immediately
receive simple instructions via email. The BHLB earnings call will
also be automatically scheduled as an event in your Outlook
calendar.
Additionally, you may reach the registration link and access the
webcast by logging in through the investor section of our website
at http://ir.berkshirebank.com.
For those parties who do not have internet access or are
otherwise unable to pre-register for this event, you may still
participate at the above time by dialing 1-888-317-6016. Please ask
the Operator to join you to the Berkshire Hills Bancorp (BHLB)
earnings call. A telephone replay of the call will be
available through Friday, November 27,
2015 by dialing 877-344-7529 and entering access number
10073969. The webcast will be available on Berkshire's website for an extended period of
time.
BACKGROUND
Berkshire Hills Bancorp is the parent of Berkshire Bank –
America's Most Exciting Bank®. Berkshire has $7.8
billion in assets and 93 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 reports on
Forms 10-K and 10-Q filed with the Securities and Exchange
Commission and available on the SEC's website at www.sec.gov.
Berkshire does not undertake any
obligation to update forward-looking statements.
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 an adjustment for income tax expense. This adjustment
is determined as the difference between the GAAP tax rate and the
effective tax rate applicable to core income. The efficiency
ratio is adjusted for non-core revenue and expense items and for
tax preference items. The Company also calculates measures
related to tangible equity, which adjust equity (and assets where
applicable) to exclude intangible assets due to the importance of
these measures to the investment community. Charges related
to 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 related systems
conversions costs. Restructuring costs primarily
consist of costs and losses associated with the disposition of
assets. In 2015, the Company's disclosures of organic
growth of loans and deposits exclude balances acquired through the
business combinations with Hampden Bancorp and Firestone
Financial.
CONTACTS
Investor Relations Contact
Allison O'Rourke; Executive Vice
President, Investor Relations Officer; 413-236-3149
Media Contact
Elizabeth Mach; Vice President,
Marketing Officer; 413-445-8390
BERKSHIRE HILLS
BANCORP, INC.
|
CONSOLIDATED
BALANCE SHEETS - UNAUDITED - (F-1)
|
|
September
30,
|
|
June 30,
|
|
|
December
31,
|
|
(In
thousands)
|
2015
|
|
2015
|
|
|
2014
|
|
Assets
|
|
|
|
|
|
|
|
Cash and due from
banks
|
$
50,716
|
|
$
177,858
|
|
|
$
54,179
|
|
Short-term
investments
|
42,855
|
|
27,660
|
|
|
17,575
|
|
Total cash and
short-term investments
|
93,571
|
|
205,518
|
|
|
71,754
|
|
|
|
|
|
|
|
|
|
Trading
security
|
14,587
|
|
14,378
|
|
|
14,909
|
|
Securities available
for sale, at fair value
|
1,176,609
|
|
1,204,756
|
|
|
1,091,818
|
|
Securities held to
maturity, at amortized cost
|
132,186
|
|
86,994
|
|
|
43,347
|
|
Federal Home Loan
Bank stock and other restricted securities
|
73,069
|
|
73,212
|
|
|
55,720
|
|
Total
securities
|
1,396,451
|
|
1,379,340
|
|
|
1,205,794
|
|
|
|
|
|
|
|
|
|
Loans held for sale,
at fair value
|
25,472
|
|
48,514
|
|
|
19,493
|
|
|
|
|
|
|
|
|
|
Residential
mortgages
|
1,769,271
|
|
1,637,356
|
|
|
1,496,204
|
|
Commercial real
estate
|
2,021,300
|
|
1,907,237
|
|
|
1,611,567
|
|
Commercial and
industrial loans
|
1,065,325
|
|
921,190
|
|
|
804,366
|
|
Consumer
loans
|
809,034
|
|
818,831
|
|
|
768,463
|
|
Total
loans
|
5,664,930
|
|
5,284,614
|
|
|
4,680,600
|
|
Less: Allowance for
loan losses
|
(38,180)
|
|
(37,197)
|
|
|
(35,662)
|
|
Net loans
|
5,626,750
|
|
5,247,417
|
|
|
4,644,938
|
|
|
|
|
|
|
|
|
|
Premises and
equipment, net
|
86,809
|
|
87,519
|
|
|
87,279
|
|
Other real estate
owned
|
2,487
|
|
674
|
|
|
2,049
|
|
Goodwill
|
324,958
|
|
308,043
|
|
|
264,742
|
|
Other intangible
assets
|
11,586
|
|
12,473
|
|
|
11,528
|
|
Cash surrender value
of bank-owned life insurance
|
124,278
|
|
123,536
|
|
|
104,588
|
|
Deferred tax asset,
net
|
42,198
|
|
39,565
|
|
|
28,776
|
|
Other
assets
|
69,928
|
|
66,148
|
|
|
61,090
|
|
Total assets
(1)
|
$
7,804,488
|
|
$ 7,518,747
|
|
|
$
6,502,031
|
|
|
|
|
|
|
|
|
|
Liabilities and
stockholders' equity
|
|
|
|
|
|
|
|
Demand
deposits
|
$
1,001,777
|
|
$ 1,012,003
|
|
|
$
869,302
|
|
NOW
deposits
|
476,351
|
|
458,570
|
|
|
426,108
|
|
Money market
deposits
|
1,485,392
|
|
1,477,770
|
|
|
1,407,179
|
|
Savings
deposits
|
603,596
|
|
621,909
|
|
|
496,344
|
|
Time
deposits
|
1,940,213
|
|
1,751,924
|
|
|
1,455,746
|
|
Total
deposits
|
5,507,329
|
|
5,322,176
|
|
|
4,654,679
|
|
|
|
|
|
|
|
|
|
Senior
borrowings
|
1,211,813
|
|
1,176,484
|
|
|
962,576
|
|
Subordinated
borrowings
|
89,798
|
|
89,782
|
|
|
89,747
|
|
Total
borrowings
|
1,301,611
|
|
1,266,266
|
|
|
1,052,323
|
|
|
|
|
|
|
|
|
|
Other
liabilities
|
113,980
|
|
103,154
|
|
|
85,742
|
|
Total
liabilities
|
6,922,920
|
|
6,691,596
|
|
|
5,792,744
|
|
|
|
|
|
|
|
|
|
Total common
stockholders' equity
|
881,568
|
|
827,151
|
|
|
709,287
|
|
Total liabilities and
stockholders' equity
|
$
7,804,488
|
|
$ 7,518,747
|
|
|
$
6,502,031
|
|
|
|
|
|
|
|
|
|
Net shares
outstanding
|
30,949
|
|
29,521
|
|
|
25,183
|
|
(1) The Company
acquired Firestone Financial ("Firestone") on August 7, 2015 with
total assets of $201 million.
|
|
|
|
|
|
|
|
|
|
|
BERKSHIRE HILLS
BANCORP, INC.
|
|
CONSOLIDATED LOAN
& DEPOSIT ANALYSIS - UNAUDITED - (F-2)
|
|
LOAN
ANALYSIS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Organic Annualized
Growth %
|
(in
millions)
|
|
Sept. 30,
2015
Balance
|
|
June,
2015
Balance
|
|
Acquired
Hampden
Balance (2)
|
|
Dec. 31,
2014
Balance
|
|
Quarter ended
Sept. 30, 2015
|
Year to
date
|
Total residential
mortgages
|
$ 1,769
|
|
$ 1,638
|
|
$
130
|
|
$ 1,496
|
|
32
|
%
|
13
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total commercial
loans (1)
|
3,087
|
|
2,828
|
|
281
|
|
2,416
|
|
9
|
|
11
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Home
equity
|
|
357
|
|
351
|
|
35
|
|
319
|
|
6
|
|
1
|
|
Auto and
other
|
|
452
|
|
468
|
|
47
|
|
450
|
|
(13)
|
|
(13)
|
|
Total consumer
loans
|
809
|
|
819
|
|
82
|
|
769
|
|
(5)
|
|
(7)
|
|
Total
loans
|
|
$ 5,665
|
|
$ 5,285
|
|
$
493
|
|
$ 4,681
|
|
14
|
%
|
9
|
%
|
(1) Total commercial
loans include $192 million in loans acquired from Firestone
Financial in the third quarter; however, the
organic
|
|
annualized growth
excludes these acquired loans.
|
|
|
|
|
|
|
|
|
(2) Acquired Hampden
loan balances are as of 6/30/2015.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
DEPOSIT
ANALYSIS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Organic Annualized
Growth %
|
(in
millions)
|
|
Sept. 30,
2015
Balance
|
|
June 30,
2015
Balance
|
|
Acquired
Hampden
Balance (2)
|
|
Dec. 31,
2014
Balance
|
|
Quarter ended
Sept. 30, 2015
|
Year to
date
|
Demand
|
|
$ 1,002
|
|
$ 1,012
|
|
$
97
|
|
$
869
|
|
(4)
|
%
|
6
|
%
|
NOW
|
|
476
|
|
458
|
|
51
|
|
426
|
|
16
|
|
(0)
|
|
Money
market
|
|
1,485
|
|
1,478
|
|
62
|
|
1,407
|
|
2
|
|
2
|
|
Savings
|
|
604
|
|
622
|
|
120
|
|
497
|
|
(12)
|
|
(3)
|
|
Total non-maturity
deposits
|
3,567
|
|
3,570
|
|
330
|
|
3,199
|
|
(0)
|
|
2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total time
deposits
|
1,940
|
|
1,752
|
|
154
|
|
1,456
|
|
43
|
|
30
|
|
Total
deposits
|
|
$ 5,507
|
|
$ 5,322
|
|
$
484
|
|
$ 4,655
|
|
14
|
%
|
11
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BERKSHIRE HILLS
BANCORP, INC.
|
CONSOLIDATED
STATEMENTS OF INCOME - UNAUDITED - (F-3)
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
Sept. 30,
|
|
Sept. 30,
|
(In thousands,
except per share data)
|
2015
|
|
2014
|
|
2015
|
|
2014
|
Interest and
dividend income
|
|
|
|
|
|
|
|
Loans
|
$
56,343
|
|
$
43,958
|
|
$
152,292
|
|
$
128,761
|
Securities and
other
|
9,109
|
|
8,098
|
|
26,314
|
|
24,265
|
Total interest and
dividend income
|
65,452
|
|
52,056
|
|
178,606
|
|
153,026
|
Interest
expense
|
|
|
|
|
|
|
|
Deposits
|
6,046
|
|
4,877
|
|
16,287
|
|
14,076
|
Borrowings
|
2,435
|
|
2,230
|
|
7,218
|
|
6,906
|
Total interest
expense
|
8,481
|
|
7,107
|
|
23,505
|
|
20,982
|
Net interest
income
|
56,971
|
|
44,949
|
|
155,101
|
|
132,044
|
Non-interest
income
|
|
|
|
|
|
|
|
Loan related
income
|
1,537
|
|
1,471
|
|
5,603
|
|
4,565
|
Mortgage banking
income
|
693
|
|
994
|
|
3,492
|
|
2,057
|
Deposit related
fees
|
6,549
|
|
6,449
|
|
18,668
|
|
18,498
|
Insurance commissions
and fees
|
2,544
|
|
2,632
|
|
7,997
|
|
8,141
|
Wealth management
fees
|
2,376
|
|
2,330
|
|
7,376
|
|
7,173
|
Total fee
income
|
13,699
|
|
13,876
|
|
43,136
|
|
40,434
|
Other
|
(1,050)
|
|
520
|
|
(3,563)
|
|
1,446
|
Securities gains,
net
|
49
|
|
245
|
|
2,467
|
|
482
|
Non-recurring
gain
|
-
|
|
-
|
|
-
|
|
(8,792)
|
Total non-interest
income
|
12,698
|
|
14,641
|
|
42,040
|
|
33,570
|
Total net
revenue
|
69,669
|
|
59,590
|
|
197,141
|
|
165,614
|
Provision for loan
losses
|
4,240
|
|
3,685
|
|
12,295
|
|
11,070
|
Non-interest
expense
|
|
|
|
|
|
|
|
Compensation and
benefits
|
25,237
|
|
20,665
|
|
71,551
|
|
60,803
|
Occupancy and
equipment
|
6,827
|
|
6,780
|
|
21,178
|
|
20,250
|
Technology and
communications
|
4,645
|
|
3,484
|
|
12,328
|
|
11,062
|
Marketing and
promotion
|
781
|
|
659
|
|
2,294
|
|
1,801
|
Professional
services
|
1,053
|
|
830
|
|
3,700
|
|
3,006
|
FDIC premiums and
assessments
|
1,157
|
|
1,163
|
|
3,429
|
|
3,201
|
Other real estate
owned and foreclosures
|
298
|
|
13
|
|
800
|
|
569
|
Amortization of
intangible assets
|
887
|
|
1,236
|
|
2,722
|
|
3,816
|
Merger, restructuring
and conversion expense (1)
|
3,361
|
|
238
|
|
16,493
|
|
6,729
|
Other
|
5,132
|
|
4,619
|
|
14,056
|
|
13,072
|
Total non-interest
expense
|
49,378
|
|
39,687
|
|
148,551
|
|
124,309
|
|
|
|
|
|
|
|
|
Income before income
taxes
|
16,051
|
|
16,218
|
|
36,295
|
|
30,235
|
Income tax
expense
|
1,350
|
|
4,230
|
|
2,791
|
|
7,888
|
Net
income
|
$
14,701
|
|
$
11,988
|
|
$
33,504
|
|
$
22,347
|
|
|
|
|
|
|
|
|
Earnings per
share:
|
|
|
|
|
|
|
|
Basic
|
$
0.49
|
|
$
0.48
|
|
$
1.21
|
|
$
0.90
|
Diluted
|
$
0.49
|
|
$
0.48
|
|
$
1.20
|
|
$
0.90
|
|
|
|
|
|
|
|
|
Weighted average
shares outstanding:
|
|
|
|
|
|
|
|
Basic
|
29,893
|
|
24,747
|
|
27,685
|
|
24,721
|
Diluted
|
30,069
|
|
24,861
|
|
27,847
|
|
24,835
|
|
|
|
|
|
|
|
|
(1) Merger,
restructuring and conversion expenses include Firestone
acquisition, Hampden acquisition, branch restructuring,
and
|
Q1 2014 branch
acquisition related expenses.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BERKSHIRE HILLS
BANCORP, INC.
|
CONSOLIDATED
STATEMENTS OF INCOME - UNAUDITED - (F-4)
|
|
BERKSHIRE HILLS
BANCORP, INC.
|
|
Sept. 30,
|
|
June 30,
|
|
March 31,
|
|
Dec. 31,
|
|
Sept. 30,
|
|
(In thousands,
except per share data)
|
2015
|
|
2015
|
|
2015
|
|
2014
|
|
2014
|
|
Interest and
dividend income
|
|
|
|
|
|
|
|
|
|
|
Loans
|
$ 56,343
|
|
$
51,504
|
|
$ 44,445
|
|
$ 45,706
|
|
$ 43,958
|
|
Securities and
other
|
9,109
|
|
8,899
|
|
8,306
|
|
8,310
|
|
8,098
|
|
Total interest and
dividend income
|
65,452
|
|
60,403
|
|
52,751
|
|
54,016
|
|
52,056
|
|
Interest
expense
|
|
|
|
|
|
|
|
|
|
|
Deposits
|
6,046
|
|
5,292
|
|
4,949
|
|
5,109
|
|
4,877
|
|
Borrowings
|
2,435
|
|
2,474
|
|
2,309
|
|
2,260
|
|
2,230
|
|
Total interest
expense
|
8,481
|
|
7,766
|
|
7,258
|
|
7,369
|
|
7,107
|
|
Net interest
income
|
56,971
|
|
52,637
|
|
45,493
|
|
46,647
|
|
44,949
|
|
Non-interest
income
|
|
|
|
|
|
|
|
|
|
|
Loan related
income
|
1,537
|
|
2,783
|
|
1,283
|
|
1,763
|
|
1,471
|
|
Mortgage banking
income
|
693
|
|
1,546
|
|
1,253
|
|
504
|
|
994
|
|
Deposit related
fees
|
6,549
|
|
6,442
|
|
5,677
|
|
6,137
|
|
6,449
|
|
Insurance commissions
and fees
|
2,544
|
|
2,486
|
|
2,967
|
|
2,223
|
|
2,632
|
|
Wealth management
fees
|
2,376
|
|
2,397
|
|
2,603
|
|
2,373
|
|
2,330
|
|
Total fee
income
|
13,699
|
|
15,654
|
|
13,783
|
|
13,000
|
|
13,876
|
|
Other
|
(1,050)
|
|
(1,258)
|
|
(1,255)
|
|
1,200
|
|
520
|
|
Securities gains,
net
|
49
|
|
2,384
|
|
34
|
|
-
|
|
245
|
|
Loss on termination
of hedges
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
Total non-interest
income
|
12,698
|
|
16,780
|
|
12,562
|
|
14,200
|
|
14,641
|
|
Total net
revenue
|
69,669
|
|
69,417
|
|
58,055
|
|
60,847
|
|
59,590
|
|
Provision for loan
losses
|
4,240
|
|
4,204
|
|
3,851
|
|
3,898
|
|
3,685
|
|
Non-interest
expense
|
|
|
|
|
|
|
|
|
|
|
Compensation and
benefits
|
25,237
|
|
24,503
|
|
21,811
|
|
20,965
|
|
20,665
|
|
Occupancy and
equipment
|
6,827
|
|
7,243
|
|
7,108
|
|
6,655
|
|
6,780
|
|
Technology and
communications
|
4,645
|
|
4,090
|
|
3,593
|
|
3,702
|
|
3,484
|
|
Marketing and
promotion
|
781
|
|
800
|
|
713
|
|
771
|
|
659
|
|
Professional
services
|
1,053
|
|
1,375
|
|
1,272
|
|
1,205
|
|
830
|
|
FDIC premiums and
assessments
|
1,157
|
|
1,143
|
|
1,129
|
|
1,083
|
|
1,163
|
|
Other real estate
owned and foreclosures
|
298
|
|
251
|
|
251
|
|
232
|
|
13
|
|
Amortization of
intangible assets
|
887
|
|
934
|
|
901
|
|
996
|
|
1,236
|
|
Merger, restructuring
and conversion expense (1)
|
3,361
|
|
8,711
|
|
4,421
|
|
1,762
|
|
238
|
|
Other
|
5,132
|
|
4,975
|
|
3,949
|
|
4,305
|
|
4,619
|
|
Total non-interest
expense
|
49,378
|
|
54,025
|
|
45,148
|
|
41,676
|
|
39,687
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before income
taxes
|
16,051
|
|
11,188
|
|
9,056
|
|
15,273
|
|
16,218
|
|
Income tax
expense
|
1,350
|
|
1,144
|
|
297
|
|
3,875
|
|
4,230
|
|
Net
income
|
$ 14,701
|
|
$
10,044
|
|
$ 8,759
|
|
$ 11,398
|
|
$ 11,988
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per
share:
|
|
|
|
|
|
|
|
|
|
|
Basic
|
$
0.49
|
|
$
0.35
|
|
$
0.35
|
|
$
0.46
|
|
$
0.48
|
|
Diluted
|
$
0.49
|
|
$
0.35
|
|
$
0.35
|
|
$
0.46
|
|
$
0.48
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
shares outstanding:
|
|
|
|
|
|
|
|
|
|
|
Basic
|
29,893
|
|
28,301
|
|
24,803
|
|
24,758
|
|
24,747
|
|
Diluted
|
30,069
|
|
28,461
|
|
24,955
|
|
24,912
|
|
24,861
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) See note on Page
F-3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BERKSHIRE HILLS
BANCORP, INC.
|
ASSET QUALITY
ANALYSIS - UNAUDITED - (F-5)
|
|
|
|
At or for the
Quarters Ended
|
|
|
|
Sept. 30,
|
|
June 30,
|
|
March 31,
|
|
Dec. 31,
|
|
Sept. 30,
|
|
|
(in
thousands)
|
|
|
2015
|
|
2015
|
|
2015
|
|
2014
|
|
2014
|
|
|
NON-PERFORMING
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-accruing
loans:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Residential
mortgages
|
|
|
$
4,565
|
|
$
4,234
|
|
$ 4,153
|
|
$ 3,908
|
|
$ 4,810
|
|
|
Commercial real
estate
|
|
|
5,693
|
|
9,733
|
|
13,516
|
|
12,878
|
|
12,192
|
|
|
Commercial and
industrial loans
|
|
|
8,092
|
|
3,031
|
|
1,308
|
|
1,705
|
|
2,225
|
|
|
Consumer
loans
|
|
|
3,386
|
|
2,991
|
|
3,032
|
|
3,214
|
|
3,660
|
|
|
Total non-accruing
loans
|
|
|
21,736
|
|
19,989
|
|
22,009
|
|
21,705
|
|
22,887
|
|
|
Other real estate
owned
|
|
|
2,487
|
|
674
|
|
1,444
|
|
2,049
|
|
4,854
|
|
|
Total non-performing
assets
|
|
|
$
24,223
|
|
$
20,663
|
|
$ 23,453
|
|
$ 23,754
|
|
$ 27,741
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total non-accruing
loans/total loans
|
|
|
0.38%
|
|
0.38%
|
|
0.47%
|
|
0.46%
|
|
0.50%
|
|
|
Total non-performing
assets/total assets
|
|
|
0.31%
|
|
0.27%
|
|
0.36%
|
|
0.37%
|
|
0.44%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
PROVISION AND
ALLOWANCE FOR LOAN LOSSES
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at beginning
of period
|
|
|
$
37,197
|
|
$
36,286
|
|
$ 35,662
|
|
$ 34,966
|
|
$ 34,353
|
|
|
Charged-off
loans
|
|
|
(3,542)
|
|
(4,176)
|
|
(3,432)
|
|
(3,660)
|
|
(3,360)
|
|
|
Recoveries on
charged-off loans
|
|
|
285
|
|
883
|
|
205
|
|
458
|
|
288
|
|
|
Net loans
charged-off
|
|
|
(3,257)
|
|
(3,293)
|
|
(3,227)
|
|
(3,202)
|
|
(3,072)
|
|
|
Provision for loan
losses
|
|
|
4,240
|
|
4,204
|
|
3,851
|
|
3,898
|
|
3,685
|
|
|
Balance at end of
period
|
|
|
$
38,180
|
|
$
37,197
|
|
$ 36,286
|
|
$ 35,662
|
|
$ 34,966
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Allowance for loan
losses/total loans
|
|
|
0.67%
|
|
0.70%
|
|
0.77%
|
|
0.76%
|
|
0.77%
|
|
|
Allowance for loan
losses/non-accruing loans
|
176%
|
|
186%
|
|
165%
|
|
164%
|
|
153%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NET LOAN
CHARGE-OFFS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Residential
mortgages
|
|
|
$
(354)
|
|
$
(367)
|
|
$
(299)
|
|
$
(181)
|
|
$
(394)
|
|
|
Commercial real
estate
|
|
|
(1,343)
|
|
(2,461)
|
|
(2,007)
|
|
(1,810)
|
|
(1,470)
|
|
|
Commercial and
industrial loans
|
|
|
(1,098)
|
|
(124)
|
|
(375)
|
|
(540)
|
|
(687)
|
|
|
Home
equity
|
|
|
(135)
|
|
(174)
|
|
(202)
|
|
(240)
|
|
(193)
|
|
|
Auto and other
consumer
|
|
|
(327)
|
|
(167)
|
|
(344)
|
|
(431)
|
|
(328)
|
|
|
Total, net
|
|
|
$
(3,257)
|
|
$
(3,293)
|
|
$ (3,227)
|
|
$ (3,202)
|
|
$ (3,072)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net charge-offs (QTD
annualized)/average loans
|
|
0.26%
|
|
0.26%
|
|
0.28%
|
|
0.29%
|
|
0.28%
|
|
|
Net charge-offs (YTD
annualized)/average loans
|
|
0.26%
|
|
0.26%
|
|
0.28%
|
|
0.29%
|
|
0.29%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
DELINQUENT AND
NON-ACCRUING LOANS/TOTAL LOANS
|
|
|
|
|
|
|
|
|
|
|
30-89 Days
delinquent
|
|
|
0.37%
|
|
0.29%
|
|
0.28%
|
|
0.42%
|
|
0.32%
|
|
|
90+ Days delinquent
and still accruing
|
|
|
0.10%
|
|
0.12%
|
|
0.15%
|
|
0.10%
|
|
0.12%
|
|
|
Total accruing
delinquent loans
|
|
|
0.47%
|
|
0.41%
|
|
0.43%
|
|
0.52%
|
|
0.44%
|
|
|
Non-accruing
loans
|
|
|
0.38%
|
|
0.38%
|
|
0.47%
|
|
0.46%
|
|
0.50%
|
|
|
Total delinquent and
non-accruing loans
|
|
|
0.85%
|
|
0.79%
|
|
0.90%
|
|
0.98%
|
|
0.94%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BERKSHIRE HILLS
BANCORP, INC.
|
SELECTED FINANCIAL
HIGHLIGHTS - UNAUDITED - (F-6)
|
|
|
|
|
At or for the
Quarters Ended (1)
|
|
|
|
|
Sept. 30,
|
|
June 30,
|
|
March 31,
|
|
Dec. 31,
|
|
Sept. 30,
|
|
|
|
|
|
2015
|
|
2015
|
|
2015
|
|
2014
|
|
2014
|
|
|
PER SHARE
DATA
|
|
|
|
|
|
|
|
|
|
|
|
|
Core earnings,
diluted
|
$ 0.54
|
|
$
0.51
|
|
$ 0.50
|
|
$ 0.48
|
|
$ 0.46
|
|
|
|
Net earnings,
diluted
|
0.49
|
|
0.35
|
|
0.35
|
|
0.46
|
|
0.48
|
|
|
|
Tangible book
value
|
17.61
|
|
17.16
|
|
17.46
|
|
17.19
|
|
16.67
|
|
|
|
Total book
value
|
28.48
|
|
28.02
|
|
28.36
|
|
28.17
|
|
27.69
|
|
|
|
Market price at
period end
|
27.54
|
|
28.48
|
|
27.70
|
|
26.66
|
|
23.49
|
|
|
|
Dividends
|
|
0.19
|
|
0.19
|
|
0.19
|
|
0.18
|
|
0.18
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
PERFORMANCE
RATIOS (2)
|
|
|
|
|
|
|
|
|
|
|
|
|
Core return on
assets
|
0.86
|
%
|
0.81
|
%
|
0.76
|
%
|
0.75
|
%
|
0.73
|
%
|
|
|
Return on
assets
|
0.78
|
|
0.56
|
|
0.54
|
|
0.71
|
|
0.77
|
|
|
|
Core return on
equity
|
7.58
|
|
7.32
|
|
7.06
|
|
6.89
|
|
6.59
|
|
|
|
Core return on
tangible equity
|
12.78
|
|
12.30
|
|
12.14
|
|
11.96
|
|
11.76
|
|
|
|
Return on
equity
|
6.90
|
|
5.05
|
|
5.00
|
|
6.52
|
|
6.95
|
|
|
|
Net interest margin,
fully taxable equivalent
|
3.37
|
|
3.30
|
|
3.18
|
|
3.23
|
|
3.20
|
|
|
|
Fee income/Net
interest and fee income
|
19.38
|
|
22.92
|
|
23.25
|
|
21.79
|
|
23.59
|
|
|
|
Efficiency
ratio
|
60.35
|
|
61.51
|
|
63.27
|
|
62.46
|
|
62.89
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GROWTH
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total commercial
loans, year-to-date (organic annualized)
|
11
|
%
|
11
|
%
|
14
|
%
|
15
|
%
|
14
|
%
|
|
|
Total loans,
year-to-date (organic annualized)
|
9
|
|
5
|
|
4
|
|
12
|
|
12
|
|
|
|
Total net revenues,
year-to-date, compared to prior year
|
19
|
|
20
|
|
23
|
|
-
|
|
(3)
|
|
|
|
Core earnings per
share, year-to-date
|
17
|
|
17
|
|
19
|
|
(4)
|
|
(10)
|
|
|
|
Earnings per share,
year-to-date (4)
|
34
|
|
69
|
|
N/M
|
|
(18)
|
|
(27)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FINANCIAL
DATA (In millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
assets
|
|
$ 7,804
|
|
$ 7,519
|
|
$ 6,571
|
|
$ 6,502
|
|
$ 6,352
|
|
|
|
Total earning
assets
|
7,130
|
|
6,740
|
|
5,993
|
|
5,923
|
|
5,765
|
|
|
|
Total
investments
|
1,396
|
|
1,379
|
|
1,216
|
|
1,206
|
|
1,171
|
|
|
|
Total
loans
|
|
5,665
|
|
5,285
|
|
4,729
|
|
4,681
|
|
4,553
|
|
|
|
Allowance for loan
losses
|
38
|
|
37
|
|
36
|
|
36
|
|
35
|
|
|
|
Total intangible
assets
|
337
|
|
321
|
|
275
|
|
276
|
|
277
|
|
|
|
Total
deposits
|
|
5,507
|
|
5,322
|
|
4,720
|
|
4,655
|
|
4,563
|
|
|
|
Total stockholders'
equity
|
882
|
|
827
|
|
716
|
|
709
|
|
697
|
|
|
|
Total core
income
|
16.2
|
|
14.6
|
|
12.4
|
|
12.0
|
|
11.4
|
|
|
|
Total net
income
|
14.7
|
|
10.0
|
|
8.8
|
|
11.4
|
|
12.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ASSET QUALITY
RATIOS
|
|
|
|
|
|
|
|
|
|
|
|
|
Net charge-offs
(current quarter annualized)/average loans
|
0.26
|
%
|
0.27
|
%
|
0.28
|
%
|
0.29
|
%
|
0.28
|
%
|
|
|
Allowance for loan
losses/total loans
|
0.67
|
|
0.70
|
|
0.77
|
|
0.76
|
|
0.77
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CONDITION
RATIOS
|
|
|
|
|
|
|
|
|
|
|
|
|
Stockholders' equity
to total assets
|
11.30
|
%
|
11.00
|
%
|
10.90
|
%
|
10.91
|
%
|
10.97
|
%
|
|
|
Tangible
stockholders' equity to tangible assets (3)
|
7.30
|
|
7.04
|
|
7.00
|
|
6.95
|
|
6.91
|
|
|
|
Investments to total
assets
|
17.89
|
|
18.35
|
|
18.51
|
|
18.54
|
|
18.43
|
|
|
|
Loans/deposits
|
103
|
|
99
|
|
100
|
|
101
|
|
100
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Reconciliation of
Non-GAAP financial measures, including all references to core and
tangible amounts, appear on pages F-9 and F-10.
|
|
(2)
|
All performance
ratios are annualized and are based on average balance sheet
amounts, where applicable.
|
|
|
|
|
|
(3)
|
Tangible assets are
total assets less total intangible assets.
|
|
|
|
|
|
|
|
|
|
(4)
|
N/M means not
meaningful.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BERKSHIRE HILLS
BANCORP, INC.
|
|
AVERAGE BALANCES -
UNAUDITED - (F-7)
|
|
|
Quarters
Ended
|
|
|
Sept. 30,
|
|
June 30,
|
|
March 31,
|
|
Dec. 31,
|
|
Sept. 30,
|
|
|
(In
thousands)
|
2015
|
|
2015
|
|
2015
|
|
2014
|
|
2014
|
|
|
Assets
|
|
|
|
|
|
|
|
|
|
|
|
Loans
|
|
|
|
|
|
|
|
|
|
|
|
Residential
mortgages
|
$ 1,664,505
|
|
$ 1,562,503
|
|
$ 1,469,910
|
|
$ 1,468,271
|
|
$ 1,412,720
|
|
|
Commercial real
estate
|
1,948,753
|
|
1,889,306
|
|
1,646,638
|
|
1,611,343
|
|
1,579,258
|
|
|
Commercial and
industrial loans
|
998,782
|
|
886,297
|
|
806,710
|
|
733,750
|
|
716,787
|
|
|
Consumer
loans
|
813,986
|
|
821,933
|
|
765,938
|
|
782,584
|
|
763,296
|
|
|
Total loans (1)
(5)
|
5,426,026
|
|
5,160,039
|
|
4,689,196
|
|
4,595,948
|
|
4,472,061
|
|
|
Securities
(2)
|
1,353,818
|
|
1,301,918
|
|
1,176,559
|
|
1,190,182
|
|
1,169,765
|
|
|
Short-term
investments and loans held for sale
|
51,832
|
|
72,003
|
|
55,652
|
|
54,843
|
|
39,496
|
|
|
Total earning
assets
|
6,831,676
|
|
6,533,960
|
|
5,921,407
|
|
5,840,973
|
|
5,681,322
|
|
|
Goodwill and other
intangible assets
|
330,084
|
|
303,780
|
|
275,732
|
|
276,645
|
|
277,775
|
|
|
Other
assets
|
379,319
|
|
357,026
|
|
300,264
|
|
304,909
|
|
305,698
|
|
|
Total
assets
|
$ 7,541,079
|
|
$ 7,194,766
|
|
$ 6,497,403
|
|
$ 6,422,527
|
|
$ 6,264,795
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities and
stockholders' equity
|
|
|
|
|
|
|
|
|
|
|
|
Deposits
(4)
|
|
|
|
|
|
|
|
|
|
|
|
NOW
|
$ 475,433
|
|
$ 460,378
|
|
$ 423,474
|
|
$ 415,806
|
|
$ 417,802
|
|
|
Money
market
|
1,474,389
|
|
1,437,428
|
|
1,408,777
|
|
1,426,722
|
|
1,405,454
|
|
|
Savings
|
615,410
|
|
606,231
|
|
502,412
|
|
479,988
|
|
480,036
|
|
|
Time
|
1,795,156
|
|
1,558,350
|
|
1,419,706
|
|
1,425,865
|
|
1,406,914
|
|
|
Total
interest-bearing deposits
|
4,360,388
|
|
4,062,387
|
|
3,754,369
|
|
3,748,381
|
|
3,710,206
|
|
|
Borrowings
|
1,198,455
|
|
1,287,319
|
|
1,106,541
|
|
1,053,884
|
|
980,135
|
|
|
Total
interest-bearing liabilities
|
5,558,843
|
|
5,349,706
|
|
4,860,910
|
|
4,802,265
|
|
4,690,341
|
|
|
Non-interest-bearing
demand deposits
|
1,010,613
|
|
974,160
|
|
869,780
|
|
863,795
|
|
824,489
|
|
|
Other
liabilities
|
119,322
|
|
75,487
|
|
65,453
|
|
56,805
|
|
60,088
|
|
|
Total
liabilities
|
6,688,778
|
|
6,399,353
|
|
5,796,143
|
|
5,722,865
|
|
5,574,918
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total stockholders'
equity
|
852,301
|
|
795,413
|
|
701,260
|
|
699,662
|
|
689,877
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total liabilities and
stockholders' equity
|
$ 7,541,079
|
|
$ 7,194,766
|
|
$ 6,497,403
|
|
$ 6,422,527
|
|
$ 6,264,795
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Supplementary
data
|
|
|
|
|
|
|
|
|
|
|
|
Total non-maturity
deposits (4)
|
$ 3,575,845
|
|
$ 3,478,197
|
|
$ 3,204,443
|
|
$ 3,186,311
|
|
$ 3,127,781
|
|
|
Total deposits
(4)
|
5,371,001
|
|
5,036,547
|
|
4,624,149
|
|
4,612,176
|
|
4,534,695
|
|
|
Fully taxable
equivalent income adjustment
|
1,131
|
|
1,068
|
|
889
|
|
887
|
|
859
|
|
|
Total average
tangible equity (3)
|
522,217
|
|
491,633
|
|
425,528
|
|
423,017
|
|
412,102
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Total loans
include non-accruing loans.
|
|
|
|
|
|
|
|
|
|
|
(2) Average balances
for securities available-for-sale are based on amortized
cost.
|
|
|
|
|
|
(3) Total average
tangible equity results from the subtraction of average goodwill
and other intangible assets from total average
|
|
|
stockholders'
equity.
|
|
|
|
|
|
|
|
|
|
|
|
(4) The average
balances of deposits include the deposits held for sale presented
under other liabilities on the consolidated balance
sheet.
|
(5) The average
balances of loans include the loans associated with the Tennessee
branch sale presented under loans held for sale on
|
|
|
the consolidated
balance sheet.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BERKSHIRE HILLS
BANCORP, INC.
|
AVERAGE
YIELDS (Fully Taxable Equivalent - Annualized) - UNAUDITED -
(F-8)
|
|
Quarters
Ended
|
|
Sept. 30,
|
|
June 30,
|
|
March 31,
|
|
Dec. 31,
|
|
Sept. 30,
|
|
|
2015
|
|
2015
|
|
2015
|
|
2014
|
|
2014
|
|
|
|
|
|
|
|
|
|
|
|
|
Earning
assets
|
|
|
|
|
|
|
|
|
|
|
Loans
|
|
|
|
|
|
|
|
|
|
|
Residential
mortgages
|
3.74
|
%
|
4.08
|
%
|
3.94
|
%
|
3.88
|
%
|
3.86
|
%
|
Commercial real
estate
|
4.47
|
|
4.46
|
|
4.12
|
|
4.18
|
|
4.26
|
|
Commercial and
industrial loans
|
4.79
|
|
3.64
|
|
3.70
|
|
4.22
|
|
3.79
|
|
Consumer
loans
|
3.29
|
|
3.24
|
|
3.23
|
|
3.35
|
|
3.34
|
|
Total
loans
|
4.14
|
|
4.02
|
|
3.86
|
|
3.96
|
|
3.91
|
|
Securities
|
2.92
|
|
2.99
|
|
3.10
|
|
3.00
|
|
2.98
|
|
Short-term
investments and loans held for sale
|
1.34
|
|
1.13
|
|
1.40
|
|
1.37
|
|
1.65
|
|
Total earning
assets
|
3.87
|
|
3.77
|
|
3.67
|
|
3.73
|
|
3.70
|
|
|
|
|
|
|
|
|
|
|
|
|
Funding
liabilities
|
|
|
|
|
|
|
|
|
|
|
Deposits
|
|
|
|
|
|
|
|
|
|
|
NOW
|
0.14
|
|
0.15
|
|
0.14
|
|
0.15
|
|
0.17
|
|
Money
market
|
0.42
|
|
0.37
|
|
0.40
|
|
0.42
|
|
0.37
|
|
Savings
|
0.15
|
|
0.17
|
|
0.15
|
|
0.14
|
|
0.14
|
|
Time
|
0.90
|
|
0.91
|
|
0.92
|
|
0.91
|
|
0.91
|
|
Total
interest-bearing deposits
|
0.55
|
|
0.52
|
|
0.53
|
|
0.54
|
|
0.52
|
|
Borrowings
|
0.81
|
|
0.77
|
|
0.85
|
|
0.85
|
|
0.90
|
|
Total
interest-bearing liabilities
|
0.61
|
|
0.58
|
|
0.61
|
|
0.61
|
|
0.60
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest
spread
|
3.26
|
|
3.19
|
|
3.06
|
|
3.12
|
|
3.10
|
|
Net interest
margin
|
3.37
|
|
3.30
|
|
3.18
|
|
3.23
|
|
3.20
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of funds
(1)
|
0.51
|
|
0.49
|
|
0.51
|
|
0.52
|
|
0.51
|
|
Cost of deposits
(2)
|
0.45
|
|
0.42
|
|
0.43
|
|
0.44
|
|
0.43
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Cost of funds
includes all deposits and borrowings.
|
|
|
|
|
|
|
|
(2) The average cost
of deposits include the deposits held for sale.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BERKSHIRE HILLS
BANCORP, INC.
|
RECONCILIATION OF
NON-GAAP FINANCIAL MEASURES - UNAUDITED - (F-9)
|
|
|
At or for the
Quarters Ended
|
|
|
Sept. 30,
|
|
June 30,
|
|
March 31,
|
|
Dec. 31,
|
|
Sept. 30,
|
|
(in
thousands)
|
|
2015
|
|
2015
|
|
2015
|
|
2014
|
|
2014
|
|
Net income
|
|
$ 14,701
|
|
$ 10,044
|
|
$ 8,759
|
|
$ 11,398
|
|
$ 11,988
|
|
Adj: Securities
gains
|
|
(49)
|
|
(2,384)
|
|
(34)
|
|
-
|
|
(245)
|
|
Adj: Loss on
termination of hedges
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
Adj: Merger and
acquisition expense
|
|
2,987
|
|
5,665
|
|
3,275
|
|
1,708
|
|
-
|
|
Adj: Restructuring
and conversion expense
|
|
374
|
|
3,046
|
|
1,146
|
|
54
|
|
238
|
|
Adj: Income
taxes
|
|
(1,862)
|
|
(1,815)
|
|
(772)
|
|
(1,114)
|
|
(612)
|
|
Total core
income
|
(A)
|
$ 16,151
|
|
$ 14,556
|
|
$ 12,374
|
|
$ 12,046
|
|
$ 11,369
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
revenue
|
|
$ 69,669
|
|
$ 69,417
|
|
$ 58,055
|
|
$ 60,847
|
|
$ 59,590
|
|
Adj: Securities
gains
|
|
(49)
|
|
(2,384)
|
|
(34)
|
|
-
|
|
(245)
|
|
Total core
revenue
|
(B)
|
$ 69,620
|
|
$ 67,033
|
|
$ 58,021
|
|
$ 60,847
|
|
$ 59,345
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total non-interest
expense
|
|
$ 49,378
|
|
$ 54,025
|
|
$ 45,148
|
|
$ 41,676
|
|
$ 39,687
|
|
Less: Total non-core
expense (see above)
|
|
(3,361)
|
|
(8,711)
|
|
(4,421)
|
|
(1,762)
|
|
(238)
|
|
Core non-interest
expense
|
(C)
|
$ 46,017
|
|
$ 45,314
|
|
$ 40,727
|
|
$ 39,914
|
|
$ 39,449
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in millions,
except per share data)
|
|
|
|
|
|
|
|
|
|
|
|
Total average
assets
|
(D)
|
$ 7,541
|
|
$ 7,195
|
|
$ 6,497
|
|
$ 6,423
|
|
$
6,265
|
|
Total average
stockholders' equity
|
(E)
|
852
|
|
795
|
|
701
|
|
700
|
|
690
|
|
Total average
tangible stockholders'
equity
|
(F)
|
522
|
|
492
|
|
426
|
|
423
|
|
412
|
|
Total tangible
stockholders' equity, period-end (1)
|
(G)
|
545
|
|
507
|
|
441
|
|
433
|
|
420
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total common shares
outstanding, period-end
(thousands)
|
(H)
|
30,949
|
|
29,521
|
|
25,253
|
|
25,183
|
|
25,173
|
|
Average diluted
shares outstanding (thousands)
|
(I)
|
30,069
|
|
28,461
|
|
24,955
|
|
24,912
|
|
24,861
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Core earnings per
share, diluted
|
(A/I)
|
$ 0.54
|
|
$ 0.51
|
|
$ 0.50
|
|
$ 0.48
|
|
$
0.46
|
|
Tangible book value
per share, period-end
|
(G/H)
|
$ 17.61
|
|
$ 17.16
|
|
$ 17.46
|
|
$ 17.19
|
|
$
16.67
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Performance
ratios (2)
|
|
|
|
|
|
|
|
|
|
|
|
Core return on
assets
|
(A/D)
|
0.86
|
%
|
0.81
|
%
|
0.76
|
%
|
0.75
|
%
|
0.73
|
%
|
Core return on
equity
|
(A/E)
|
7.58
|
|
7.32
|
|
7.06
|
|
6.89
|
|
6.59
|
|
Core return on
tangible equity (3)
|
(A/F)
|
12.78
|
|
12.30
|
|
12.14
|
|
11.96
|
|
11.76
|
|
Efficiency
ratio
|
(C-L)/(B+J+M)
|
60.35
|
|
61.51
|
|
63.27
|
|
62.46
|
|
62.89
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Supplementary
data (in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
Tax benefit -
tax-advantaged investments (4)
|
(J)
|
$ 4,029
|
|
$ 4,034
|
|
$ 4,034
|
|
$ 570
|
|
$
555
|
|
Non-interest income
charge - tax-advantaged investments (5)
|
(K)
|
(2,851)
|
|
(2,851)
|
|
(2,851)
|
|
(417)
|
|
(417)
|
|
Net income on
tax-advantaged investments
|
(J+K)
|
1,178
|
|
1,183
|
|
1,183
|
|
153
|
|
138
|
|
Intangible
amortization
|
(L)
|
887
|
|
934
|
|
901
|
|
996
|
|
1,236
|
|
Fully taxable
equivalent income adjustment
|
(M)
|
1,131
|
|
1,068
|
|
889
|
|
887
|
|
859
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Total tangible
stockholders' equity is computed by taking total stockholders'
equity less the intangible assets at period-end.
|
|
(2) Ratios are
annualized and based on average balance sheet amounts, where
applicable. Quarterly data may not sum to year-to-date data
due
|
to
rounding.
|
|
|
|
|
|
|
|
|
|
|
|
(3) Core return on
tangible equity is computed by dividing the total core income
adjusted for the tax-affected amortization of
|
|
|
intangible assets,
assuming a 40% marginal rate, by tangible equity.
|
|
|
|
|
|
|
|
|
|
(4) The tax benefit
is the direct reduction to the income tax provision due to tax
credits and deductions generated from investments in
historic
|
rehabilitation,
low-income housing, new market projects, and renewable energy
projects.
|
|
|
|
|
|
|
|
(5) The non-interest
income charge is the reduction to the tax-advantaged investments,
which are incurred as the tax credits are generated.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BERKSHIRE HILLS
BANCORP, INC.
|
|
|
RECONCILIATION OF
NON-GAAP FINANCIAL MEASURES - UNAUDITED - (F-10)
|
|
|
|
|
As of or at Nine
Months Ended
|
|
|
|
|
Sept. 30,
|
|
Sept. 30,
|
|
|
(Dollars in
thousands)
|
|
2015
|
|
2014
|
|
|
Net income
|
|
$
33,504
|
|
$
22,347
|
|
|
Adj: Securities
gains
|
|
(2,467)
|
|
(482)
|
|
|
Adj: Loss on
termination of hedges
|
|
-
|
|
8,792
|
|
|
Adj: Merger and
acquisition expenses
|
|
11,927
|
|
3,689
|
|
|
Adj: Restructuring
and conversion expenses
|
|
4,566
|
|
3,041
|
|
|
Adj: Out-of-period
adjustment (1)
|
|
-
|
|
1,381
|
|
|
Adj: Income
taxes
|
|
(4,449)
|
|
(6,071)
|
|
|
Total core
income
|
(A)
|
$
43,081
|
|
$
32,697
|
|
|
Total
revenue
|
|
197,141
|
|
165,614
|
|
|
Adj: Securities
gains
|
|
(2,467)
|
|
(482)
|
|
|
Adj: Loss on
termination of hedges
|
|
-
|
|
8,792
|
|
|
Adj: Out-of-period
adjustment (1)
|
|
-
|
|
1,381
|
|
|
Total core
revenue
|
(B)
|
$
194,674
|
|
$
175,305
|
|
|
Total non-interest
expense
|
|
$
148,551
|
|
$
124,310
|
|
|
Less: Total non-core
expense (see above)
|
|
(16,493)
|
|
(6,730)
|
|
|
Core non-interest
expense
|
(C)
|
$
132,058
|
|
$
117,580
|
|
|
|
|
|
|
|
|
|
(Dollars in
millions, except per share data)
|
|
|
|
|
|
|
Total average
assets
|
(D)
|
$
7,078
|
|
$
6,087
|
|
|
Total average
stockholders'
equity
|
(E)
|
783
|
|
691
|
|
|
Total average
tangible stockholders'
equity
|
(F)
|
480
|
|
412
|
|
|
Total tangible
stockholders' equity, period-end (2)
|
(G)
|
545
|
|
420
|
|
|
|
|
|
|
|
|
|
Total common shares
outstanding, period-end
(thousands)
|
(H)
|
30,949
|
|
25,173
|
|
|
Average diluted
shares outstanding (thousands) (3)
|
(I)
|
27,847
|
|
24,835
|
|
|
|
|
|
|
|
|
|
Core earnings per
common share, diluted
|
(A/I)
|
$
1.55
|
|
$
1.32
|
|
|
Tangible book value
per common share, period-end
|
(G/H)
|
$
17.61
|
|
$
16.67
|
|
|
|
|
|
|
|
|
|
Performance
ratios (4)
|
|
|
|
|
|
|
Core return on
assets
|
(A/D)
|
0.81
|
%
|
0.72
|
%
|
|
Core return on
equity
|
(A/E)
|
7.34
|
|
6.31
|
|
|
Core return on
tangible equity (5)
|
(A/F)
|
12.43
|
|
11.31
|
|
|
Efficiency
ratio
|
(C-L)/(B+J+M)
|
61.63
|
|
63.41
|
|
|
|
|
|
|
|
|
|
Supplementary
data
|
|
|
|
|
|
|
Tax benefit -
tax-advantaged investments (6)
|
(J)
|
$
12,098
|
|
$
1,664
|
|
|
Non-interest income
charge - tax-advantaged investments (7)
|
(K)
|
(8,554)
|
|
(1,251)
|
|
|
Net income on
tax-advantaged investments
|
(J+K)
|
3,543
|
|
413
|
|
|
Intangible
amortization
|
(L)
|
2,722
|
|
3,816
|
|
|
Fully taxable
equivalent income adjustment
|
(M)
|
3,088
|
|
2,429
|
|
|
|
|
|
|
|
|
|
GAAP return on
assets
|
|
0.63
|
%
|
0.49
|
%
|
|
GAAP return on
equity
|
|
5.71
|
|
4.31
|
|
|
Net interest
margin
|
|
3.29
|
|
3.27
|
|
|
|
|
|
|
|
|
(1) The out of period
adjustment shown above relates to interest income earned on loans
acquired in bank acquisitions.
|
|
(2) Total tangible
stockholders' equity is computed by taking total stockholders'
equity less the intangible assets at period-end.
|
|
(3) Average diluted
shares computed for core earnings per share differ from GAAP
average diluted shares, in the first quarter of 2014,
|
|
due to the GAAP net
loss compared to core net income for the period.
|
|
|
|
(4) Ratios are
annualized and based on average balance sheet amounts, where
applicable. Quarterly data may not sum to year-to-date
data
|
|
|
due to
rounding.
|
|
|
|
|
|
(5) 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.
|
|
|
|
|
(6) The tax benefit
is the direct reduction to the income tax provision due to tax
credits and deductions generated from investments
in
|
|
(7) The non-interest
income charge is the reduction to the tax-advantaged investments,
which are incurred as the tax credits are generated.
|
|
|
|
|
|
|
|
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SOURCE Berkshire Hills Bancorp, Inc.