BOSTON, Oct. 28, 2019 /PRNewswire/ -- Berkshire
Hills Bancorp, Inc. (NYSE: BHLB) reported third quarter 2019 GAAP
net income of $23 million, or
$0.44 per share, compared to
$25 million, or $0.52 per share, in the prior
quarter. The non-GAAP measure of core earnings totaled
$24 million, or $0.46 per share, compared to $32 million, or $0.65 per share, in the prior quarter.
Non-core earnings are net of discontinued operations and merger
charges which in 2019 were related to the May 17 acquisition of SI Financial Group,
Inc. Third quarter results included a $16 million loan loss provision ($0.23 per share after tax) related to the full
charge-off of a commercial loan which defaulted in September due to
potential fraud. Before this loan charge, core EPS increased
to $0.69 from $0.65 in the prior quarter due to improved
revenue and efficiency.
THIRD QUARTER FINANCIAL HIGHLIGHTS (income statement
metrics are compared to the prior quarter):
- 8% increase in net revenue from continuing operations
- 3.22% net interest margin, increased from 3.19%
- 17% increase in fee income from continuing operations
- 53.4% efficiency ratio, improved from 56.4%
- 0.28% non-performing assets/assets
CEO Richard Marotta stated, "We
made good progress with our initiatives in the third quarter.
Revenue grew strongly, including the benefit of a full quarter of
SI Financial operations, an improved margin, and good fee income
gains. Expense initiatives contributed to improved
efficiency. Income declined due to a charge-off of a
$16 million commercial loan which
defaulted in September as a result of potential borrower
fraud. Credit performance has otherwise remained solid.
Liquidity and capital measures continued to strengthen, and our per
share measures of book value and tangible book value improved over
the prior quarter."
Mr. Marotta continued, "We also announced that J. Williar
("Bill") Dunlaevy was elected as Chair of the Board effective
December 1, 2019. Our current
Chair, William J. Ryan, is stepping
down from that role due to health reasons, but will remain active
on the Board. I'm grateful to Bill Ryan for his leadership and insights built
over his successful and prominent banking career. As a career
banker, Bill Dunlaevy will provide
important insights as we move forward in building a 21st
century community bank with a strong focus on maximizing the
business benefits of expanding our operations and customer base to
be more diverse and inclusive."
Mr. Marotta concluded, "During the third quarter, we introduced
our Friends and Family Fund CD aimed at helping entrepreneurs of
color access the seed capital they need in order to launch the
businesses of their dreams. We also made progress in
developing our storefront initiative and expect to have more
announcements about that program before year-end. We
completed the systems conversion of our acquired SI Financial
operations early in October and expect to complete the merger
integration on plan and within budget by the end of the
year. Our combined teams are well positioned to
deliver the benefits of this merger as we move forward into
2020."
DIVIDEND DECLARED
The Board of Directors approved a quarterly cash dividend of
$0.23 per common share to
shareholders of record at the close of business on November 14, 2019 and payable on November 27, 2019. The dividend equates to
a 3.0% annualized yield based on the $30.44 average closing price of Berkshire Hills
Bancorp common stock during the third quarter of 2019.
Effective on the same dates, the Board also approved a quarterly
cash dividend on preferred stock totaling $0.46 per share.
FINANCIAL CONDITION
Total assets were $13.5 billion at
September 30, 2019. Total
loans decreased by 2% during the quarter, including targeted runoff
of indirect auto loans and accelerated prepayments of residential
mortgages resulting from a dip in mortgage interest rates.
Approximately $50 million in acquired
or syndicated non-relationship commercial balances were
released. The Company continues to hold its
$169 million commercial aircraft
portfolio for sale. The 0.28% ratio of nonperforming assets
to assets remained below the 0.30% ratio reported a year ago.
Accruing delinquent loans were 0.55% of loans, remaining below the
0.60% year-ago ratio. The ratio of the loan loss allowance to
total loans decreased to 0.64% from 0.66% over this time.
Total deposits decreased by 1% during the quarter due to a
$53 million decrease in overnight
payroll related balances and a targeted decrease of approximately
$100 million in wholesale brokered
deposits. Leverage and liquidity ratios improved. Book value
per share increased by $0.31 to
$34.36 and the non-GAAP measure of
tangible book value per share increased by $0.17 to $22.42. During the third quarter, the
Company repurchased 800 thousand shares of common stock at an
average purchase price of $30.48 per
share.
RESULTS OF OPERATIONS
GAAP earnings were $0.44 per share
in the most recent quarter, compared to $0.52 per share in the prior quarter.
Earnings per share were reduced by $0.23 due to the charge-off of the aforementioned
$16 million loan which was partially
offset by a $0.08 per share reduction
in after-tax merger related expenses. Many measures of
revenue and expense, as well as average diluted shares, increased
over the prior quarter due to the full quarter impact of the SI
Financial operations acquired for stock on May 17, 2019.
The non-GAAP measure of core earnings totaled $0.46 per share in the most recent quarter.
This measure is reconciled to GAAP earnings on pages F-9 and F-10
of the financial tables. Core EPS totaled $0.65 in the prior quarter. In the most
recent quarter, core earnings totaled $0.69 per share before the $0.23 net impact of the $16 million aforementioned loan charge-off.
Third quarter results benefited from higher revenues and improved
efficiency. The primary non-core items in the third
quarter were SI Financial merger related charges and operating
earnings of the national mortgage banking operations which are
deemed held for sale and classified as discontinued.
Net revenue from continuing operations increased by 8% compared
to the prior quarter, including a 6% increase in net interest
income and a 17% increase in fee income. Interest income
benefited from a full quarter of SI Financial earning assets, as
well as an increase in the net interest margin to 3.22% from
3.19%. As a result of lower interest rates and reduced
wholesale funds, the Company's funding costs decreased
quarter-over-quarter to 1.32% from 1.41%. The total margin
benefit from purchase accounting was 0.16% compared to 0.11% in the
second quarter.
Fee income increased by $3 million
quarter-over-quarter as a result of volume gains in several
areas. Loan related fee income increased by $2 million including higher commercial interest
rate swap fees and higher SBA loan sale gains. For the SBA
fiscal year ended September 30,
Berkshire's team ranked as the
18th largest lender in the country for SBA 7A loan
originations, advancing from 28th position last
year. Deposit fee income increased quarter-over-quarter by
$1 million including income from
acquired SI Financial operations.
The provision for loan losses increased to $22.6 million in the most recent quarter,
compared to $3.5 million in the prior
quarter. This increase included $16
million provided for the previously mentioned charge-off,
together with a write-down of a nonperforming commercial real
estate loan which was disclosed in prior periods.
Total non-interest expense from continuing operations decreased
quarter-over-quarter by $6 million,
due to a $6 million reduction in
merger related expenses. Net of merger and other non-core
charges, the non-GAAP measure of core expense increased
quarter-over-quarter by $1 million,
or 2%. A $1.9 million rebate of
FDIC premiums benefited expense by 3% during the quarter. The
positive operating leverage driven by the 8% revenue increase
resulted in an improvement in the efficiency ratio to 53.4% from
56.4% quarter-over quarter. With the completion of the
SI Financial systems integration in early October on time and on
plan, the Company is expecting to complete its targeted merger
related cost saves by year-end. Full-time equivalent staff in
continuing operations totaled 1,594 positions at period-end,
compared to 1,621 at the start of the quarter. The effective
tax rate was 17% in the third quarter, down from 18% in the prior
quarter, due to the decrease in taxable income.
The FCLS national mortgage banking operations contributed
$0.04 in non-core EPS in the most
recent quarter, compared to $0.03 in
the prior quarter. Mortgage banking fees totaled $15 million in the quarter, which was up 14% over
the prior quarter and 63% year-over-year. The company
generated $1.1 billion in residential
mortgages in the most recent quarter. Due to the decision to
sell the FCLS operations, they are accounted for as discontinued in
the financial statements, and most references to revenue and
expense refer to continuing operations and exclude FCLS revenue and
expense.
BE FIRST PROGRAM UPDATE
Expanding our base of commercial and individual
customers. Including our new SI Financial operations,
Berkshire has a strong geographic
footprint throughout the Northeast. This footprint provides an
array of diverse market demographics which provide significant
opportunity for expansion. Berkshire Bank is
pursuing a number of initiatives to increase market share among
demographics that have typically been left behind by traditional
banks (and their products/services), with a particular focus on
African Americans and Latinos.
Pilot Projects to support minority business
enterprises. Berkshire Bank is creating storefronts in
traditionally minority communities/downtown areas to provide access
to working space, business advice and financial products. The
first storefront is being developed in Roxbury, MA and there are plans to expand
these storefronts in our footprint and selectively in adjacent
markets. In the third quarter, the Bank launched the "Friends
and Family" fund in coordination with the Runway Project to provide
seed capital to minority business enterprises funded by CD products
offered for this purpose. The Bank is also taking a
leadership role in the Boston area
Business Equity Fund, which provides rigorously vetted traditional
loan products to minority business enterprises that have
participated in the existing Business Equity Initiative.
Efforts to better connect Berkshire Bank to minority
communities. The Bank is sponsoring and actively
participating in community-based events, including the Dimock
Community Health Center (Stepping Out), NAACP (Freedom Fund
Dinner), LGBT Chamber, Union Chapel Speaker series, and the Black
Economic Alliance.
Enhancing diversity, equity and inclusion initiatives within
Berkshire Bank. The Bank is focusing on bank products,
services and operations that are conducted in a way that draws
minority customers. The Bank is participating in the CEO
Action for Diversity and Inclusion. Earlier this year, the
Bank launched its Be FIRST values program, which is being enhanced
throughout the year.
INVESTOR CONFERENCE CALL
Berkshire will conduct a conference
call/webcast at 10:00 a.m. eastern
time on Tuesday, October 29, 2019 to discuss the
results for the quarter and provide guidance about expected future
results. Participants are encouraged to pre-register for the
conference call using the following
link: http://dpregister.com/10135510. 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. Additionally, participants
may reach the registration link and access the webcast by logging
in through the investor section of our website
at http://ir.berkshirebank.com. Those parties who do not have
internet access or are otherwise unable to pre-register for this
event, may still participate at the above time by dialing
1-844-792-3726 and asking the Operator to join the
Berkshire Hills Bancorp (BHLB) earnings call. A telephone
replay of the call will be available through Tuesday, November
5, 2019 by dialing 877-344-7529 and entering access number
10135510. 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 which is
transforming into a 21st century community bank with a
culture of belonging. Headquartered in
Boston, Berkshire operates 132 banking offices in
seven Northeastern states, with approximately $13.5 billion in assets.
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 on pages
F-9 and F-10 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 items which the Company
does not view as related to its normalized operations. These
items primarily include securities gains/losses, merger costs,
restructuring costs, and discontinued operations. Merger
costs consist primarily of severance/benefit related expenses,
contract termination costs, systems conversion costs, variable
compensation expenses, and professional fees. Merger costs in
2018 and 2019 are primarily related to the acquisitions of Commerce
Bancshares Corp. and SI Financial Group. Restructuring costs
generally consist of costs and losses associated with the
disposition of assets and liabilities and lease terminations,
including costs related to branch sales. Restructuring costs
also include severance and consulting expenses related to the
Company's strategic review. Discontinued operations are
the Company's national mortgage banking operations for which the
Company is pursuing sale opportunities. In 2018, the Company
recorded $8 million in charges
related to the restructuring of banking systems vendor
relationships. The Company recorded a $3 million cost in 2018 for the settlement of an
existing legal proceeding with a plaintiff claiming to be
representing a class of depositors. Non-core charges in 2018
also included a $1.5 million net
charge related to the CEO transition.
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.
CONTACTS
Investor Relations Contact
David Gonci; Capital Markets
Director; 413-281-1973
Media Contact
Diana Pisciotta; Communications
Contact; 617-784-5256
TABLE
INDEX
|
CONSOLIDATED
UNAUDITED FINANCIAL SCHEDULES
|
F-1
|
Selected Financial
Highlights
|
F-2
|
Balance
Sheets
|
F-3
|
Loan and Deposit
Analysis
|
F-4
|
Statements of
Income
|
F-5
|
Statements of
Operations (Five Quarter Trend)
|
F-6
|
Average Yields and
Costs
|
F-7
|
Average
Balances
|
F-8
|
Asset Quality
Analysis
|
F-9
|
Reconciliation of
Non-GAAP Financial Measures
|
|
and Supplementary
Data (Five Quarter Trend)
|
F-10
|
Reconciliation of
Non-GAAP Financial Measures
|
|
and Supplementary
Data (Year-to-Date)
|
BERKSHIRE HILLS
BANCORP, INC.
|
SELECTED FINANCIAL
HIGHLIGHTS - UNAUDITED - (F-1)
|
|
|
|
At or for the
Quarters Ended (1)
|
|
|
|
Sept. 30,
|
|
June 30,
|
|
March 31,
|
|
Dec. 31,
|
|
Sept. 30,
|
|
|
|
|
2019
|
|
2019 (2)
|
|
2019
|
|
2018
|
|
2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
PER SHARE
DATA
|
|
|
|
|
|
|
|
|
|
|
|
Net earnings per
common share, diluted
|
$
0.44
|
|
$
0.52
|
|
$
0.51
|
|
$
0.31
|
|
$
0.70
|
|
|
Core earnings per
common share, diluted (3)
|
0.46
|
|
0.65
|
|
0.60
|
|
0.69
|
|
0.72
|
|
|
Total book value per
common share
|
34.36
|
|
34.05
|
|
33.75
|
|
33.30
|
|
32.84
|
|
|
Tangible book value
per common share (3)
|
22.42
|
|
22.25
|
|
21.66
|
|
21.15
|
|
20.68
|
|
|
Market price at
period end
|
29.29
|
|
31.39
|
|
27.24
|
|
26.97
|
|
40.70
|
|
|
Dividends per common
share
|
0.23
|
|
0.23
|
|
0.23
|
|
0.22
|
|
0.22
|
|
|
Dividends per
preferred share
|
0.46
|
|
0.46
|
|
0.46
|
|
0.44
|
|
0.44
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
PERFORMANCE RATIOS
(4)
|
|
|
|
|
|
|
|
|
|
|
|
Return on
assets
|
0.67
|
%
|
0.79
|
%
|
0.78
|
%
|
0.47
|
%
|
1.08
|
%
|
|
Core return on assets
(3)
|
0.71
|
|
1.01
|
|
0.92
|
|
1.07
|
|
1.12
|
|
|
Return on
equity
|
5.12
|
|
6.07
|
|
5.97
|
|
3.61
|
|
8.27
|
|
|
Core return on equity
(3)
|
5.35
|
|
7.67
|
|
7.00
|
|
8.09
|
|
8.49
|
|
|
Core return on
tangible common equity (3)
|
8.74
|
|
12.21
|
|
11.44
|
|
13.21
|
|
14.02
|
|
|
Net interest margin,
fully taxable equivalent (FTE) (5)(6)
|
3.22
|
|
3.19
|
|
3.17
|
|
3.41
|
|
3.32
|
|
|
Fee income/Net
interest and fee income from continuing operations
|
17.61
|
|
16.20
|
|
17.56
|
|
15.59
|
|
18.06
|
|
|
Efficiency ratio
(3)
|
53.37
|
|
56.41
|
|
59.54
|
|
54.88
|
|
52.20
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GROWTH
(Year-to-date)
|
|
|
|
|
|
|
|
|
|
|
|
Total commercial
loans (organic, annualized)
|
(9)
|
%
|
(10)
|
%
|
(3)
|
%
|
6
|
%
|
5
|
%
|
|
Total loans (organic,
annualized)
|
(9)
|
|
(9)
|
|
(4)
|
|
9
|
|
10
|
|
|
Total deposits
(organic, annualized)
|
2
|
|
6
|
|
8
|
|
3
|
|
0
|
|
|
Total net revenues
from continuing operations (compared to prior year)
|
4
|
|
1
|
|
3
|
|
17
|
|
22
|
|
|
Earnings per common
share (compared to prior year)
|
(26)
|
|
(20)
|
|
(7)
|
|
65
|
|
28
|
|
|
Core earnings per
common share (compared to prior year)(3)
|
(18)
|
|
(9)
|
|
(8)
|
|
32
|
|
37
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FINANCIAL DATA
(in millions)
|
|
|
|
|
|
|
|
|
|
|
|
Total
assets
|
|
$
13,532
|
|
$
13,653
|
|
$
12,173
|
|
$
12,212
|
|
$
12,030
|
|
|
Total earning
assets
|
12,174
|
|
12,343
|
|
11,039
|
|
11,140
|
|
10,957
|
|
|
Total
securities
|
1,861
|
|
1,905
|
|
1,881
|
|
1,919
|
|
1,918
|
|
|
Total
loans
|
|
9,719
|
|
9,942
|
|
8,947
|
|
9,043
|
|
8,905
|
|
|
Allowance for loan
losses
|
62
|
|
62
|
|
62
|
|
61
|
|
58
|
|
|
Total intangible
assets
|
602
|
|
603
|
|
551
|
|
552
|
|
553
|
|
|
Total
deposits
|
|
10,423
|
|
10,566
|
|
9,166
|
|
8,982
|
|
8,766
|
|
|
Total shareholders'
equity
|
1,772
|
|
1,779
|
|
1,577
|
|
1,553
|
|
1,532
|
|
|
Net income
|
|
22.6
|
|
25.4
|
|
23.6
|
|
14.3
|
|
32.2
|
|
|
Core income
(3)
|
23.7
|
|
32.1
|
|
27.7
|
|
32.0
|
|
33.1
|
|
|
Purchase accounting
accretion
|
4.8
|
|
3.2
|
|
1.3
|
|
8.2
|
|
4.6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ASSET QUALITY AND
CONDITION RATIOS
|
|
|
|
|
|
|
|
|
|
|
|
Net charge-offs
(current quarter annualized)/average loans
|
0.92
|
%
|
0.14
|
%
|
0.15
|
%
|
0.17
|
%
|
0.19
|
%
|
|
Total non-performing
assets/total assets
|
0.28
|
|
0.27
|
|
0.26
|
|
0.28
|
|
0.30
|
|
|
Allowance for loan
losses/total loans
|
0.64
|
|
0.63
|
|
0.69
|
|
0.68
|
|
0.66
|
|
|
Loans/deposits
|
93
|
|
94
|
|
98
|
|
101
|
|
102
|
|
|
Shareholders' equity
to total assets
|
13.10
|
|
13.03
|
|
12.95
|
|
12.72
|
|
12.74
|
|
|
Tangible
shareholders' equity to tangible assets (3)
|
9.05
|
|
9.01
|
|
8.83
|
|
8.59
|
|
8.53
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Reconciliations of
non-GAAP financial measures, including all references to core and
tangible amounts, appear on pages F-9 and F-10.
|
|
|
|
(2)
|
The Company acquired
SI Financial Group, Inc. on May 17, 2019.
|
|
|
|
|
|
|
|
|
|
|
(3)
|
Non-GAAP financial
measure. Core measurements are non-GAAP financial measures that are
adjusted to exclude net non-core charges
primarily
|
|
|
related to
acquisitions and restructuring activities. See pages F-9 and F-10
for reconciliations of non-GAAP financial measures.
|
|
|
|
|
(4)
|
All performance
ratios are annualized and are based on average balance sheet
amounts, where applicable.
|
|
|
|
|
|
|
|
(5)
|
Fully taxable
equivalent considers the impact of tax advantaged investment
securities and loans.
|
|
|
|
|
|
|
|
|
(6)
|
The effect of
purchase accounting accretion for loans, time deposits, and
borrowings on the quarterly net interest margin was an increase in
all quarters,
|
|
|
which is shown
sequentially as follows beginning with the most recent quarter and
ending with the earliest quarter: 0.16%, 0.11%, 0.05%, 0.30%,
0.17%.
|
|
BERKSHIRE HILLS
BANCORP, INC.
|
CONSOLIDATED
BALANCE SHEETS - UNAUDITED - (F-2)
|
|
September
30,
|
|
June 30,
|
|
December
31,
|
|
(in
thousands)
|
2019
|
|
2019
|
|
2018
|
|
Assets
|
|
|
|
|
|
|
Cash and due from
banks
|
$
121,629
|
|
$
100,588
|
|
$
100,972
|
|
Short-term
investments
|
180,466
|
|
128,718
|
|
82,217
|
|
Total cash and
short-term investments
|
302,095
|
|
229,306
|
|
183,189
|
|
|
|
|
|
|
|
|
Trading
security
|
11,145
|
|
11,210
|
|
11,212
|
|
Marketable equity
securities, at fair value
|
59,596
|
|
59,578
|
|
56,638
|
|
Securities available
for sale, at fair value
|
1,369,604
|
|
1,410,078
|
|
1,399,647
|
|
Securities held to
maturity, at amortized cost
|
364,675
|
|
364,463
|
|
373,763
|
|
Federal Home Loan
Bank stock and other restricted securities
|
56,049
|
|
59,356
|
|
77,344
|
|
Total
securities
|
1,861,069
|
|
1,904,685
|
|
1,918,604
|
|
|
|
|
|
|
|
|
Loans held for
sale
|
204,900
|
|
184,810
|
|
2,183
|
|
|
|
|
|
|
|
|
Commercial real
estate loans
|
4,028,461
|
|
4,005,347
|
|
3,400,221
|
|
Commercial and
industrial loans
|
1,845,086
|
|
1,987,297
|
|
1,980,046
|
|
Residential
mortgages
|
2,838,657
|
|
2,882,380
|
|
2,566,424
|
|
Consumer
loans
|
1,006,437
|
|
1,066,804
|
|
1,096,562
|
|
Total
loans
|
9,718,641
|
|
9,941,828
|
|
9,043,253
|
|
Less: Allowance for
loan losses
|
(62,230)
|
|
(62,156)
|
|
(61,469)
|
|
Net loans
|
9,656,411
|
|
9,879,672
|
|
8,981,784
|
|
|
|
|
|
|
|
|
Premises and
equipment, net
|
123,195
|
|
121,619
|
|
106,500
|
|
Other real estate
owned
|
-
|
|
154
|
|
-
|
|
Goodwill
|
554,704
|
|
554,704
|
|
518,325
|
|
Other intangible
assets
|
47,198
|
|
48,724
|
|
33,418
|
|
Cash surrender value
of bank-owned life insurance
|
227,085
|
|
227,458
|
|
190,609
|
|
Deferred tax asset,
net
|
49,543
|
|
51,118
|
|
42,434
|
|
Other
assets
|
263,464
|
|
238,950
|
|
120,926
|
|
Assets from
discontinued operations
|
242,279
|
|
212,745
|
|
114,259
|
|
Total
assets
|
$
13,531,943
|
|
$
13,653,945
|
|
$
12,212,231
|
|
|
|
|
|
|
|
|
Liabilities and
shareholders' equity
|
|
|
|
|
|
|
Demand
deposits
|
$
1,887,621
|
|
$
1,827,016
|
|
$
1,603,019
|
|
NOW and other
deposits
|
1,267,057
|
|
997,685
|
|
1,122,321
|
|
Money market
deposits
|
2,478,947
|
|
2,811,158
|
|
2,245,195
|
|
Savings
deposits
|
831,972
|
|
848,699
|
|
724,129
|
|
Time
deposits
|
3,957,721
|
|
4,081,398
|
|
3,287,717
|
|
Total
deposits
|
10,423,318
|
|
10,565,956
|
|
8,982,381
|
|
|
|
|
|
|
|
|
Senior
borrowings
|
904,149
|
|
904,814
|
|
1,428,298
|
|
Subordinated
borrowings
|
96,991
|
|
96,927
|
|
89,518
|
|
Total
borrowings
|
1,001,140
|
|
1,001,741
|
|
1,517,816
|
|
|
|
|
|
|
|
|
Other
liabilities
|
301,647
|
|
280,155
|
|
149,519
|
|
Liabilities from
discontinued operations
|
33,614
|
|
26,256
|
|
9,597
|
|
Total
liabilities
|
11,759,719
|
|
11,874,108
|
|
10,659,313
|
|
|
|
|
|
|
|
|
Preferred
shareholders' equity
|
40,633
|
|
40,633
|
|
40,633
|
|
Common shareholders'
equity
|
1,731,591
|
|
1,739,204
|
|
1,512,285
|
|
Total shareholders'
equity
|
1,772,224
|
|
1,779,837
|
|
1,552,918
|
|
Total liabilities and
shareholders' equity
|
$
13,531,943
|
|
$
13,653,945
|
|
$
12,212,231
|
|
|
|
|
|
|
|
|
Net common shares
outstanding
|
50,394
|
|
51,045
|
|
45,417
|
|
|
|
|
|
|
|
|
BERKSHIRE HILLS
BANCORP, INC.
|
CONSOLIDATED LOAN
& DEPOSIT ANALYSIS - UNAUDITED - (F-3)
|
LOAN
ANALYSIS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Organic Annualized
Growth %(1)
|
(in
millions)
|
|
September 30,
2019
Balance
|
|
June 30, 2019
Balance
|
|
Acquired Savings
Institute Balances (2)
|
|
December 31, 2018
Balance
|
|
Quarter ended
September 30, 2019
|
|
Year to
Date
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total commercial real
estate
|
|
$
4,029
|
|
$
4,006
|
|
$
624
|
|
$
3,400
|
|
2
|
%
|
0
|
%
|
Commercial and
industrial loans
|
|
1,845
|
|
1,987
|
|
244
|
|
1,980
|
|
(29)
|
|
(26)
|
|
Total commercial
loans
|
|
5,874
|
|
5,993
|
|
868
|
|
5,380
|
|
(8)
|
|
(9)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total residential
mortgages
|
|
2,839
|
|
2,882
|
|
375
|
|
2,566
|
|
(6)
|
|
(5)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Home
equity
|
|
394
|
|
404
|
|
58
|
|
377
|
|
(10)
|
|
(15)
|
|
Auto and
other
|
|
612
|
|
663
|
|
2
|
|
720
|
|
(31)
|
|
(20)
|
|
Total consumer
loans
|
|
1,006
|
|
1,067
|
|
60
|
|
1,097
|
|
(23)
|
|
(18)
|
|
Total
loans
|
|
$
9,719
|
|
$
9,942
|
|
$
1,303
|
|
$
9,043
|
|
(9)
|
%
|
(9)
|
%
|
(1) Non-GAAP
financial measure.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(2) The acquired
balances for Savings Institute are as of May 17, 2019.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
DEPOSIT
ANALYSIS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Organic Annualized
Growth % (1)
|
(in
millions)
|
|
September 30,
2019
Balance
|
|
June 30, 2019
Balance
|
|
Acquired Savings
Institute Balances (2)
|
|
December 31, 2018
Balance
|
|
Quarter ended
September 30, 2019
|
|
Year to
Date
|
|
Demand
|
|
$
1,887
|
|
$
1,827
|
|
$
258
|
|
$
1,603
|
|
13
|
%
|
2
|
%
|
NOW and
other
|
|
1,267
|
|
998
|
|
138
|
|
1,122
|
|
108
|
|
1
|
|
Money
market
|
|
2,479
|
|
2,811
|
|
190
|
|
2,245
|
|
(47)
|
|
3
|
|
Savings
|
|
832
|
|
849
|
|
164
|
|
724
|
|
(8)
|
|
(10)
|
|
Time
deposits
|
|
3,958
|
|
4,081
|
|
585
|
|
3,288
|
|
(12)
|
|
3
|
|
Total
deposits
|
|
$
10,423
|
|
$
10,566
|
|
$
1,335
|
|
$
8,982
|
|
(5)
|
%
|
2
|
%
|
(1) Non-GAAP
financial measure.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(2) The acquired
balances for Savings Institute are as of May 17, 2019.
|
|
|
|
|
|
|
|
|
|
BERKSHIRE HILLS
BANCORP, INC.
|
CONSOLIDATED
STATEMENTS OF INCOME - UNAUDITED - (F-4)
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
September
30,
|
|
September
30,
|
(in thousands,
except per share data)
|
2019
|
|
2018
|
|
2019
|
|
2018
|
Interest and
dividend income from continuing
operations
|
|
|
|
|
|
|
|
Loans
|
$
118,371
|
|
$
102,651
|
|
$
338,012
|
|
$
294,646
|
Securities and
other
|
15,354
|
|
14,918
|
|
46,060
|
|
44,553
|
Total interest and
dividend income
|
133,725
|
|
117,569
|
|
384,072
|
|
339,199
|
Interest expense
from continuing operations
|
|
|
|
|
|
|
|
Deposits
|
31,501
|
|
21,460
|
|
86,396
|
|
54,553
|
Borrowings
|
5,353
|
|
7,724
|
|
23,751
|
|
21,212
|
Total interest
expense
|
36,854
|
|
29,184
|
|
110,147
|
|
75,765
|
Net interest
income from continuing operations
|
96,871
|
|
88,385
|
|
273,925
|
|
263,434
|
Non-interest
income from continuing operations
|
|
|
|
|
|
|
|
Mortgage banking
originations
|
292
|
|
15
|
|
616
|
|
487
|
Loan related
income
|
6,493
|
|
7,246
|
|
17,318
|
|
18,068
|
Deposit related
fees
|
8,705
|
|
7,004
|
|
23,088
|
|
22,675
|
Insurance commissions
and fees
|
2,895
|
|
2,930
|
|
8,486
|
|
8,504
|
Wealth management
fees
|
2,325
|
|
2,283
|
|
7,114
|
|
7,160
|
Total fee
income
|
20,710
|
|
19,478
|
|
56,622
|
|
56,894
|
Other
|
609
|
|
468
|
|
1,363
|
|
1,891
|
Securities
gains/(losses), net
|
87
|
|
88
|
|
2,655
|
|
(696)
|
Gain on sale of
business operations and assets, net
|
-
|
|
-
|
|
-
|
|
460
|
Total non-interest
income
|
21,406
|
|
20,034
|
|
60,640
|
|
58,549
|
Total net revenue
from continuing operations
|
118,277
|
|
108,419
|
|
334,565
|
|
321,983
|
Provision for loan
losses
|
22,600
|
|
6,628
|
|
30,068
|
|
18,735
|
Non-interest
expense from continuing operations
|
|
|
|
|
|
|
|
Compensation and
benefits
|
37,272
|
|
31,746
|
|
105,551
|
|
99,092
|
Occupancy and
equipment
|
9,893
|
|
9,145
|
|
28,788
|
|
27,561
|
Technology and
communications
|
6,849
|
|
7,507
|
|
19,821
|
|
21,044
|
Marketing and
promotion
|
1,006
|
|
1,167
|
|
3,428
|
|
3,473
|
Professional
services
|
2,282
|
|
1,481
|
|
8,510
|
|
4,041
|
FDIC premiums and
assessments
|
-
|
|
1,640
|
|
3,390
|
|
4,246
|
Other real estate
owned and foreclosures
|
150
|
|
(1)
|
|
150
|
|
67
|
Amortization of
intangible assets
|
1,526
|
|
1,218
|
|
4,201
|
|
3,732
|
Merger, restructuring
and other expense
|
4,163
|
|
198
|
|
22,333
|
|
6,138
|
Other
|
7,870
|
|
5,526
|
|
23,398
|
|
17,126
|
Total non-interest
expense
|
71,011
|
|
59,627
|
|
219,570
|
|
186,520
|
|
|
|
|
|
|
|
|
Income from
continuing operations before income
taxes
|
$
24,666
|
|
$
42,164
|
|
$
84,927
|
|
$
116,728
|
Income tax
expense
|
4,007
|
|
9,095
|
|
16,042
|
|
24,577
|
Net income from
continuing operations
|
$
20,659
|
|
$
33,069
|
|
$
68,885
|
|
$
92,151
|
|
|
|
|
|
|
|
|
Income/(loss) from
discontinued operations before income taxes
|
$
2,747
|
|
$
(1,147)
|
|
$
3,975
|
|
$
(883)
|
Income tax
expense/(benefit)
|
790
|
|
(305)
|
|
1,161
|
|
(238)
|
Net income/(loss)
from discontinued operations
|
$
1,957
|
|
$
(842)
|
|
$
2,814
|
|
$
(645)
|
|
|
|
|
|
|
|
|
Net
income
|
$
22,616
|
|
$
32,227
|
|
$
71,699
|
|
$
91,506
|
Preferred stock
dividend
|
240
|
|
230
|
|
720
|
|
689
|
Income available
to common shareholders
|
$
22,376
|
|
$
31,997
|
|
$
70,979
|
|
$
90,817
|
|
|
|
|
|
|
|
|
Basic earnings per
common share:
|
|
|
|
|
|
|
|
Continuing
Operations
|
$
0.40
|
|
$
0.72
|
|
$
1.41
|
|
$
2.00
|
Discontinued
Operations
|
0.04
|
|
(0.02)
|
|
0.06
|
|
(0.01)
|
Total
|
$
0.44
|
|
$
0.70
|
|
$
1.47
|
|
$
1.99
|
|
|
|
|
|
|
|
|
Diluted earnings
per common share:
|
|
|
|
|
|
|
|
Continuing
Operations
|
$
0.40
|
|
$
0.72
|
|
$
1.40
|
|
$
1.99
|
Discontinued
Operations
|
0.04
|
|
(0.02)
|
|
0.06
|
|
(0.01)
|
Total
|
$
0.44
|
|
$
0.70
|
|
$
1.46
|
|
$
1.98
|
|
|
|
|
|
|
|
|
Weighted average
shares
outstanding:
|
|
|
|
|
|
|
|
Basic
|
51,422
|
|
46,030
|
|
48,846
|
|
46,009
|
Diluted
|
51,545
|
|
46,263
|
|
48,987
|
|
46,226
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BERKSHIRE HILLS
BANCORP, INC.
|
CONSOLIDATED
STATEMENTS OF OPERATIONS (5 Quarter Trend) - UNAUDITED -
(F-5)
|
|
|
|
Sept. 30,
|
|
June 30,
|
|
March 31,
|
|
Dec. 31,
|
|
Sept. 30,
|
|
(in thousands,
except per share data)
|
2019
|
|
2019
|
|
2019
|
|
2018
|
|
2018
|
|
Interest and
dividend income from continuing
operations
|
|
|
|
|
|
|
|
|
|
|
Loans
|
$
118,371
|
|
$
113,990
|
|
$
105,651
|
|
$
111,576
|
|
$
102,651
|
|
Securities and
other
|
15,354
|
|
15,248
|
|
15,458
|
|
15,119
|
|
14,918
|
|
Total interest and
dividend income
|
133,725
|
|
129,238
|
|
121,109
|
|
126,695
|
|
117,569
|
|
Interest expense
from continuing operations
|
|
|
|
|
|
|
|
|
|
|
Deposits
|
31,501
|
|
28,273
|
|
26,622
|
|
23,811
|
|
21,460
|
|
Borrowings
|
5,353
|
|
9,370
|
|
9,028
|
|
10,118
|
|
7,724
|
|
Total interest
expense
|
36,854
|
|
37,643
|
|
35,650
|
|
33,929
|
|
29,184
|
|
Net interest
income from continuing operations
|
96,871
|
|
91,595
|
|
85,459
|
|
92,766
|
|
88,385
|
|
Non-interest
income from continuing operations
|
|
|
|
|
|
|
|
|
|
|
Mortgage banking
originations
|
292
|
|
278
|
|
46
|
|
148
|
|
15
|
|
Loan related
income
|
6,493
|
|
4,822
|
|
6,003
|
|
5,087
|
|
7,246
|
|
Deposit related
fees
|
8,705
|
|
7,525
|
|
6,858
|
|
7,131
|
|
7,004
|
|
Insurance commissions
and fees
|
2,895
|
|
2,738
|
|
2,853
|
|
2,479
|
|
2,930
|
|
Wealth management
fees
|
2,325
|
|
2,348
|
|
2,441
|
|
2,287
|
|
2,283
|
|
Total fee
income
|
20,710
|
|
17,711
|
|
18,201
|
|
17,132
|
|
19,478
|
|
Other
|
609
|
|
(216)
|
|
970
|
|
1,666
|
|
468
|
|
Securities
gains/(losses), net
|
87
|
|
17
|
|
2,551
|
|
(3,023)
|
|
88
|
|
(Loss) on sale of
business operations and assets, net
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
Total non-interest
income
|
21,406
|
|
17,512
|
|
21,722
|
|
15,775
|
|
20,034
|
|
Total net revenue
from continuing operations
|
118,277
|
|
109,107
|
|
107,181
|
|
108,541
|
|
108,419
|
|
Provision for loan
losses
|
22,600
|
|
3,467
|
|
4,001
|
|
6,716
|
|
6,628
|
|
Non-interest
expense from continuing operations
|
|
|
|
|
|
|
|
|
|
|
Compensation and
benefits
|
37,272
|
|
34,779
|
|
33,500
|
|
34,927
|
|
31,746
|
|
Occupancy and
equipment
|
9,893
|
|
9,449
|
|
9,446
|
|
9,366
|
|
9,145
|
|
Technology and
communications
|
6,849
|
|
6,715
|
|
6,257
|
|
6,103
|
|
7,507
|
|
Marketing and
promotion
|
1,006
|
|
1,155
|
|
1,267
|
|
1,224
|
|
1,167
|
|
Professional
services
|
2,282
|
|
3,953
|
|
2,275
|
|
3,302
|
|
1,481
|
|
FDIC premiums and
assessments
|
-
|
|
1,751
|
|
1,639
|
|
1,488
|
|
1,640
|
|
Other real estate
owned and foreclosures
|
150
|
|
(2)
|
|
2
|
|
1
|
|
(1)
|
|
Amortization of
intangible assets
|
1,526
|
|
1,475
|
|
1,200
|
|
1,202
|
|
1,218
|
|
Merger, restructuring
and other expense
|
4,163
|
|
11,155
|
|
7,015
|
|
16,006
|
|
198
|
|
Other
|
7,870
|
|
6,138
|
|
9,390
|
|
6,754
|
|
5,526
|
|
Total non-interest
expense
|
71,011
|
|
76,568
|
|
71,991
|
|
80,373
|
|
59,627
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from
continuing operations before income taxes
|
$
24,666
|
|
$
29,072
|
|
$
31,189
|
|
$
21,452
|
|
$
42,164
|
|
Income tax
expense
|
4,007
|
|
5,118
|
|
6,917
|
|
4,384
|
|
9,095
|
|
Net income from
continuing operations
|
$
20,659
|
|
$
23,954
|
|
$
24,272
|
|
$
17,068
|
|
$
33,069
|
|
|
|
|
|
|
|
|
|
|
|
|
Income/(loss) from
discontinued operations before income taxes
|
$
2,747
|
|
$
2,082
|
|
$
(854)
|
|
$
(3,884)
|
|
$
(1,147)
|
|
Income tax
expense/(benefit)
|
790
|
|
588
|
|
(217)
|
|
(1,075)
|
|
(305)
|
|
Net income/(loss)
from discontinued operations
|
$
1,957
|
|
$
1,494
|
|
$
(637)
|
|
$
(2,809)
|
|
$
(842)
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
income
|
$
22,616
|
|
$
25,448
|
|
$
23,635
|
|
$
14,259
|
|
$
32,227
|
|
Preferred stock
dividend
|
240
|
|
240
|
|
240
|
|
229
|
|
230
|
|
Income available
to common shareholders
|
$
22,376
|
|
$
25,208
|
|
$
23,395
|
|
$
14,030
|
|
$
31,997
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings per
common share:
|
|
|
|
|
|
|
|
|
|
|
Continuing
Operations
|
$
0.40
|
|
$
0.49
|
|
$
0.52
|
|
$
0.37
|
|
$
0.72
|
|
Discontinued
Operations
|
0.04
|
|
0.03
|
|
(0.01)
|
|
(0.06)
|
|
(0.02)
|
|
Total
|
$
0.44
|
|
$
0.52
|
|
$
0.51
|
|
$
0.31
|
|
$
0.70
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings
per common share:
|
|
|
|
|
|
|
|
|
|
|
Continuing
Operations
|
$
0.40
|
|
$
0.49
|
|
$
0.52
|
|
$
0.37
|
|
$
0.72
|
|
Discontinued
Operations
|
0.04
|
|
0.03
|
|
(0.01)
|
|
(0.06)
|
|
(0.02)
|
|
Total
|
$
0.44
|
|
$
0.52
|
|
$
0.51
|
|
$
0.31
|
|
$
0.70
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
shares
outstanding:
|
|
|
|
|
|
|
|
|
|
|
Basic
|
51,422
|
|
48,961
|
|
46,113
|
|
46,061
|
|
46,030
|
|
Diluted
|
51,545
|
|
49,114
|
|
46,261
|
|
46,240
|
|
46,263
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BERKSHIRE HILLS
BANCORP, INC.
|
AVERAGE YIELDS AND
COSTS (Fully Taxable Equivalent - Annualized) - UNAUDITED -
(F-6)
|
|
|
Quarters
Ended
|
|
|
Sept. 30,
|
|
June 30,
|
|
March 31,
|
|
Dec. 31,
|
|
Sept. 30,
|
|
|
|
2019
|
|
2019
|
|
2019
|
|
2018
|
|
2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earning
assets
|
|
|
|
|
|
|
|
|
|
|
|
Loans:
|
|
|
|
|
|
|
|
|
|
|
|
Commercial real
estate
|
|
4.92
|
%
|
5.01
|
%
|
4.91
|
%
|
5.40
|
%
|
4.67
|
%
|
Commercial and
industrial loans
|
|
5.58
|
|
5.79
|
|
5.83
|
|
5.97
|
|
6.22
|
|
Residential
mortgages
|
|
3.73
|
|
3.74
|
|
3.74
|
|
3.72
|
|
3.66
|
|
Consumer
loans
|
|
4.55
|
|
4.52
|
|
4.45
|
|
4.52
|
|
4.27
|
|
Total
loans
|
|
4.67
|
|
4.76
|
|
4.73
|
|
4.94
|
|
4.66
|
|
Securities
|
|
3.41
|
|
3.38
|
|
3.46
|
|
3.34
|
|
3.32
|
|
Short-term
investments and loans held for sale
|
|
4.11
|
|
3.37
|
|
3.59
|
|
3.74
|
|
3.82
|
|
Total earning
assets
|
|
4.45
|
|
4.51
|
|
4.49
|
|
4.64
|
|
4.41
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Funding
liabilities
|
|
|
|
|
|
|
|
|
|
|
|
Deposits:
|
|
|
|
|
|
|
|
|
|
|
|
NOW and
other
|
|
0.61
|
|
0.66
|
|
0.65
|
|
0.59
|
|
0.58
|
|
Money
market
|
|
1.27
|
|
1.27
|
|
1.23
|
|
1.10
|
|
0.92
|
|
Savings
|
|
0.13
|
|
0.15
|
|
0.18
|
|
0.16
|
|
0.15
|
|
Time
|
|
2.02
|
|
2.06
|
|
2.07
|
|
1.93
|
|
1.76
|
|
Total
interest-bearing deposits
|
|
1.43
|
|
1.44
|
|
1.44
|
|
1.31
|
|
1.18
|
|
Borrowings
|
|
3.12
|
|
2.92
|
|
2.85
|
|
2.67
|
|
2.42
|
|
Total
interest-bearing liabilities
|
|
1.57
|
|
1.66
|
|
1.65
|
|
1.55
|
|
1.38
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest
spread
|
|
2.88
|
|
2.85
|
|
2.84
|
|
3.09
|
|
3.03
|
|
Net interest
margin
|
|
3.22
|
|
3.19
|
|
3.17
|
|
3.41
|
|
3.32
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of funds
(1)
|
|
1.32
|
|
1.41
|
|
1.41
|
|
1.31
|
|
1.16
|
|
Cost of
deposits
|
|
1.18
|
|
1.18
|
|
1.19
|
|
1.07
|
|
0.96
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Cost of funds
includes all deposits and borrowings.
|
|
|
|
|
|
|
|
|
|
BERKSHIRE HILLS
BANCORP, INC.
|
AVERAGE BALANCES -
UNAUDITED - (F-7)
|
|
Quarters
Ended
|
|
Sept.
30,
|
|
June
30,
|
|
March
31,
|
|
Dec.
31,
|
|
Sept.
30,
|
|
(in
thousands)
|
2019
|
|
2019
|
|
2019
|
|
2018
|
|
2018
|
|
Assets
|
|
|
|
|
|
|
|
|
|
|
Loans
|
|
|
|
|
|
|
|
|
|
|
Commercial real
estate
|
$
3,998,144
|
|
$
3,716,130
|
|
$
3,377,902
|
|
$
3,373,936
|
|
$
3,331,097
|
|
Commercial and
industrial loans
|
1,951,205
|
|
2,056,384
|
|
1,986,792
|
|
1,921,361
|
|
1,824,369
|
|
Residential
mortgages
|
2,849,216
|
|
2,711,348
|
|
2,556,299
|
|
2,539,592
|
|
2,459,943
|
|
Consumer
loans
|
1,035,893
|
|
1,064,579
|
|
1,079,583
|
|
1,112,433
|
|
1,120,942
|
|
Total loans
(1)
|
9,834,458
|
|
9,548,441
|
|
9,000,576
|
|
8,947,322
|
|
8,736,351
|
|
Securities
(2)
|
1,846,985
|
|
1,893,298
|
|
1,895,768
|
|
1,933,891
|
|
1,928,851
|
|
Short-term
investments and loans held for sale
|
309,897
|
|
117,029
|
|
67,367
|
|
51,827
|
|
47,752
|
|
Total earning assets
(3)
|
11,991,340
|
|
11,558,768
|
|
10,963,711
|
|
10,933,040
|
|
10,712,954
|
|
Goodwill and other
intangible assets
|
603,762
|
|
555,606
|
|
550,966
|
|
552,206
|
|
554,359
|
|
Other
assets
|
668,218
|
|
593,917
|
|
557,442
|
|
494,377
|
|
501,739
|
|
Assets from
discontinued operations
|
204,339
|
|
192,466
|
|
115,721
|
|
101,464
|
|
141,443
|
|
Total
assets
|
$
13,467,659
|
|
$
12,900,757
|
|
$
12,187,840
|
|
$
12,081,087
|
|
$
11,910,495
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities and
shareholders' equity
|
|
|
|
|
|
|
|
|
|
|
Deposits
|
|
|
|
|
|
|
|
|
|
|
NOW and
other
|
$
1,111,637
|
|
$
1,053,335
|
|
$
963,043
|
|
$
920,225
|
|
$
844,888
|
|
Money
market
|
2,624,639
|
|
2,474,071
|
|
2,378,496
|
|
2,339,699
|
|
2,348,516
|
|
Savings
|
838,445
|
|
780,797
|
|
736,707
|
|
728,853
|
|
740,765
|
|
Time
|
4,158,688
|
|
3,593,022
|
|
3,429,375
|
|
3,229,521
|
|
3,274,518
|
|
Total
interest-bearing deposits
|
8,733,409
|
|
7,901,225
|
|
7,507,621
|
|
7,218,298
|
|
7,208,687
|
|
Borrowings
|
805,035
|
|
1,415,614
|
|
1,351,834
|
|
1,566,478
|
|
1,363,914
|
|
Total
interest-bearing liabilities
|
9,538,444
|
|
9,316,839
|
|
8,859,455
|
|
8,784,776
|
|
8,572,601
|
|
Non-interest-bearing
demand deposits
|
1,864,964
|
|
1,673,560
|
|
1,538,767
|
|
1,579,013
|
|
1,635,564
|
|
Other
liabilities
|
267,922
|
|
215,704
|
|
192,119
|
|
127,370
|
|
132,521
|
|
Liabilities from
discontinued operations
|
28,206
|
|
18,434
|
|
13,962
|
|
8,854
|
|
11,880
|
|
Total
liabilities
|
11,699,536
|
|
11,224,537
|
|
10,604,303
|
|
10,500,013
|
|
10,352,566
|
|
|
|
|
|
|
|
|
|
|
|
|
Preferred
shareholders' equity
|
40,633
|
|
40,633
|
|
40,633
|
|
40,633
|
|
40,633
|
|
Common shareholders'
equity
|
1,727,490
|
|
1,635,587
|
|
1,542,904
|
|
1,540,441
|
|
1,517,296
|
|
Total shareholders'
equity
|
1,768,123
|
|
1,676,220
|
|
1,583,537
|
|
1,581,074
|
|
1,557,929
|
|
Total liabilities and
shareholders' equity
|
$
13,467,659
|
|
$
12,900,757
|
|
$
12,187,840
|
|
$
12,081,087
|
|
$
11,910,495
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Supplementary
data
|
|
|
|
|
|
|
|
|
|
|
Total average
non-maturity deposits
|
$
6,439,685
|
|
$
5,981,763
|
|
$
5,617,013
|
|
$
5,567,790
|
|
$
5,569,733
|
|
Total average
deposits
|
10,598,373
|
|
9,574,785
|
|
9,046,388
|
|
8,797,311
|
|
8,844,251
|
|
Fully taxable
equivalent income adjustment
|
1,826
|
|
1,882
|
|
1,809
|
|
1,763
|
|
1,807
|
|
Total average
tangible equity (4)
|
1,164,361
|
|
1,120,614
|
|
1,032,571
|
|
1,028,868
|
|
1,003,570
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Total loans
include non-accruing loans.
|
|
|
|
|
|
|
|
|
|
|
(2) Average balances
for securities available-for-sale are based on amortized
cost.
|
|
|
|
|
|
|
|
(3) Excludes
discontinued operations for presentation purposes. Performance
ratios are calculated including the impact of discontinued
operations.
|
|
(4) See page F-9 for
details on the calculation of total average tangible
equity.
|
|
|
|
|
|
|
|
BERKSHIRE HILLS
BANCORP, INC.
|
ASSET QUALITY
ANALYSIS - UNAUDITED - (F-8)
|
|
|
At or for the
Quarters Ended
|
|
|
Sept. 30,
|
|
June 30,
|
|
March 31,
|
|
Dec. 31,
|
|
Sept. 30,
|
|
(in
thousands)
|
|
2019
|
|
2019
|
|
2019
|
|
2018
|
|
2018
|
|
NON-PERFORMING
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
Non-accruing
loans:
|
|
|
|
|
|
|
|
|
|
|
|
Commercial real
estate
|
|
$
15,829
|
|
$
19,366
|
|
$
18,513
|
|
$
20,371
|
|
$
22,639
|
|
Commercial and
industrial loans
|
|
12,224
|
|
9,256
|
|
5,614
|
|
6,003
|
|
4,914
|
|
Residential
mortgages
|
|
3,062
|
|
3,579
|
|
2,341
|
|
2,217
|
|
2,683
|
|
Consumer
loans
|
|
5,191
|
|
3,570
|
|
4,038
|
|
3,834
|
|
4,401
|
|
Total non-accruing
loans
|
|
36,306
|
|
35,771
|
|
30,506
|
|
32,425
|
|
34,637
|
|
Other real estate
owned
|
|
-
|
|
154
|
|
-
|
|
-
|
|
-
|
|
Repossessed
assets
|
|
1,003
|
|
874
|
|
742
|
|
1,209
|
|
1,069
|
|
Total non-performing
assets
|
|
$
37,309
|
|
$
36,799
|
|
$
31,248
|
|
$
33,634
|
|
$
35,706
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total non-accruing
loans/total loans
|
|
0.37%
|
|
0.36%
|
|
0.34%
|
|
0.36%
|
|
0.39%
|
|
Total non-performing
assets/total assets
|
|
0.28%
|
|
0.27%
|
|
0.26%
|
|
0.28%
|
|
0.30%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
PROVISION AND
ALLOWANCE FOR LOAN LOSSES
|
|
|
|
|
|
|
|
|
|
|
Balance at beginning
of period
|
|
$
62,156
|
|
$
62,038
|
|
$
61,469
|
|
$
58,457
|
|
$
55,925
|
|
Charged-off
loans
|
|
(23,524)
|
|
(3,966)
|
|
(4,579)
|
|
(4,029)
|
|
(4,471)
|
|
Recoveries on
charged-off loans
|
|
998
|
|
617
|
|
1,147
|
|
325
|
|
375
|
|
Net loans
charged-off
|
|
(22,526)
|
|
(3,349)
|
|
(3,432)
|
|
(3,704)
|
|
(4,096)
|
|
Provision for loan
losses
|
|
22,600
|
|
3,467
|
|
4,001
|
|
6,716
|
|
6,628
|
|
Balance at end of
period
|
|
$
62,230
|
|
$
62,156
|
|
$
62,038
|
|
$
61,469
|
|
$
58,457
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Allowance for loan
losses/total loans
|
|
0.64%
|
|
0.63%
|
|
0.69%
|
|
0.68%
|
|
0.66%
|
|
Allowance for loan
losses/non-accruing loans
|
|
171%
|
|
174%
|
|
203%
|
|
190%
|
|
169%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NET LOAN
CHARGE-OFFS
|
|
|
|
|
|
|
|
|
|
|
|
Commercial real
estate
|
|
$
(2,759)
|
|
$
(1,235)
|
|
$
(752)
|
|
$
(1,357)
|
|
$
(3,074)
|
|
Commercial and
industrial loans
|
|
(18,850)
|
|
(995)
|
|
(1,580)
|
|
(1,538)
|
|
(189)
|
|
Residential
mortgages
|
|
(140)
|
|
(139)
|
|
(95)
|
|
(108)
|
|
61
|
|
Home
equity
|
|
(71)
|
|
(300)
|
|
(257)
|
|
(116)
|
|
(242)
|
|
Auto and other
consumer
|
|
(706)
|
|
(680)
|
|
(748)
|
|
(585)
|
|
(652)
|
|
Total, net
|
|
$
(22,526)
|
|
$
(3,349)
|
|
$
(3,432)
|
|
$
(3,704)
|
|
$
(4,096)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net charge-offs (QTD
annualized)/average loans
|
0.92%
|
|
0.14%
|
|
0.15%
|
|
0.17%
|
|
0.19%
|
|
Net charge-offs (YTD
annualized)/average loans
|
0.41%
|
|
0.15%
|
|
0.15%
|
|
0.18%
|
|
0.19%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
DELINQUENT AND
NON-ACCRUING LOANS/TOTAL LOANS
|
|
|
|
|
|
|
|
|
|
30-89 Days
delinquent
|
|
0.26%
|
|
0.20%
|
|
0.22%
|
|
0.27%
|
|
0.38%
|
|
90+ Days delinquent
and still accruing
|
|
0.29%
|
|
0.28%
|
|
0.23%
|
|
0.22%
|
|
0.22%
|
|
Total accruing
delinquent loans
|
|
0.55%
|
|
0.48%
|
|
0.45%
|
|
0.49%
|
|
0.60%
|
|
Non-accruing
loans
|
|
0.37%
|
|
0.36%
|
|
0.34%
|
|
0.36%
|
|
0.39%
|
|
Total delinquent and
non-accruing loans
|
|
0.92%
|
|
0.84%
|
|
0.79%
|
|
0.85%
|
|
0.99%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BERKSHIRE HILLS
BANCORP, INC.
|
|
RECONCILIATION OF
NON-GAAP FINANCIAL MEASURES AND SUPPLEMENTARY DATA- UNAUDITED -
(F-9)
|
|
|
|
At or for the
Quarters Ended
|
|
|
|
Sept. 30,
|
|
June 30,
|
|
March 31,
|
|
Dec. 31,
|
|
Sept. 30,
|
|
|
(in
thousands)
|
|
2019
|
|
2019
|
|
2019
|
|
2018
|
|
2018
|
|
|
Net income
|
|
$
22,616
|
|
$
25,448
|
|
$
23,635
|
|
$
14,259
|
|
$
32,227
|
|
|
Adj: Net securities
(gains)/losses (1)
|
|
(87)
|
|
(17)
|
|
(2,551)
|
|
3,023
|
|
(88)
|
|
|
Adj: Net (gains) on
sale of business operations and assets
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
|
Adj: Merger and
acquisition expense
|
|
3,802
|
|
9,711
|
|
1,609
|
|
2,792
|
|
198
|
|
|
Adj: Restructuring
expense and other expense
|
|
361
|
|
1,444
|
|
5,406
|
|
1,822
|
|
-
|
|
|
Adj: Legal
settlements
|
|
-
|
|
-
|
|
-
|
|
3,000
|
|
-
|
|
|
Adj: Systems vendor
restructuring costs
|
|
-
|
|
-
|
|
-
|
|
8,379
|
|
-
|
|
|
Adj: (Income)/loss
from discontinued operations before income taxes
|
(2,747)
|
|
(2,082)
|
|
854
|
|
3,884
|
|
1,147
|
|
|
Adj: Income
taxes
|
|
(281)
|
|
(2,385)
|
|
(1,223)
|
|
(5,185)
|
|
(397)
|
|
|
Total core income
(2)
|
(A)
|
$
23,664
|
|
$
32,119
|
|
$
27,730
|
|
$
31,974
|
|
$
33,087
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total revenue from
continuing operations
|
|
$
118,277
|
|
$
109,107
|
|
$
107,181
|
|
$
108,541
|
|
$
108,419
|
|
|
Adj: Net securities
(gains)/losses (1)
|
|
(87)
|
|
(17)
|
|
(2,551)
|
|
3,023
|
|
(88)
|
|
|
Adj: Net (gains) on
sale of business operations and assets
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
|
Total core revenue
(2)
|
(B)
|
$
118,190
|
|
$
109,090
|
|
$
104,630
|
|
$
111,564
|
|
$
108,331
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total non-interest
expense from continuing operations
|
|
$
71,011
|
|
$
76,568
|
|
$
71,991
|
|
$
80,373
|
|
$
59,627
|
|
|
Less: Merger,
restructuring and other expense (see above)
|
|
(4,163)
|
|
(11,155)
|
|
(7,015)
|
|
(4,614)
|
|
(198)
|
|
|
Less: Legal
settlements
|
|
-
|
|
-
|
|
-
|
|
(3,000)
|
|
-
|
|
|
Less: Systems vendor
restructuring costs
|
|
-
|
|
-
|
|
-
|
|
(8,379)
|
|
-
|
|
|
Core non-interest
expense (2)
|
(C)
|
$
66,848
|
|
$
65,413
|
|
$
64,976
|
|
$
64,380
|
|
$
59,429
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in millions,
except per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
Total average
assets
|
(D)
|
$
13,468
|
|
$
12,901
|
|
$
12,188
|
|
$
12,081
|
|
$
11,910
|
|
|
Total average
shareholders'
equity
|
(E)
|
1,768
|
|
1,676
|
|
1,584
|
|
1,581
|
|
1,558
|
|
|
Total average
tangible shareholders' equity
(2)
|
(F)
|
1,164
|
|
1,121
|
|
1,033
|
|
1,029
|
|
1,004
|
|
|
Total average
tangible common shareholders' equity
(2)
|
(G)
|
1,124
|
|
1,080
|
|
992
|
|
988
|
|
963
|
|
|
Total tangible
shareholders' equity, period-end (2)(3)
|
(H)
|
1,170
|
|
1,176
|
|
1,026
|
|
1,001
|
|
979
|
|
|
Total tangible common
shareholders' equity, period-end (2)(3)
|
(I)
|
1,130
|
|
1,136
|
|
986
|
|
961
|
|
939
|
|
|
Total tangible
assets, period-end (2)(3)
|
(J)
|
12,930
|
|
13,051
|
|
11,623
|
|
11,660
|
|
11,477
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total common shares
outstanding, period-end
(thousands)
|
(K)
|
50,394
|
|
51,045
|
|
45,522
|
|
45,417
|
|
45,420
|
|
|
Average diluted
shares outstanding (thousands)
|
(L)
|
51,545
|
|
49,114
|
|
46,261
|
|
46,240
|
|
46,263
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Core earnings per
common share, diluted(2)
|
(A/L)
|
$
0.46
|
|
$
0.65
|
|
$
0.60
|
|
$
0.69
|
|
$
0.72
|
|
|
Tangible book value
per common share, period-end (2)
|
(I/K)
|
22.42
|
|
22.25
|
|
21.66
|
|
21.15
|
|
20.68
|
|
|
Total tangible
shareholders' equity/total tangible assets (2)
|
(H)/(J)
|
9.05
|
|
9.01
|
|
8.83
|
|
8.59
|
|
8.53
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Performance ratios
(4)
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP return on
assets
|
|
0.67
|
%
|
0.79
|
%
|
0.78
|
|
0.47
|
%
|
1.08
|
%
|
|
Core return on assets
(2)
|
|
0.71
|
|
1.01
|
|
0.92
|
|
1.07
|
|
1.12
|
|
|
GAAP return on
equity
|
|
5.12
|
|
6.07
|
|
5.97
|
|
3.61
|
|
8.27
|
|
|
Core return on equity
(2)
|
(A/E)
|
5.35
|
|
7.67
|
|
7.00
|
|
8.09
|
|
8.49
|
|
|
Core
return on tangible common equity (2)(5)
|
(A+O)/(G)
|
8.74
|
|
12.21
|
|
11.44
|
|
13.21
|
|
14.02
|
|
|
Efficiency ratio
(2)(6)
|
(C-O)/(B+M+P)
|
53.37
|
|
56.41
|
|
59.54
|
|
54.88
|
|
52.20
|
|
|
Net interest
margin
|
|
3.22
|
|
3.19
|
|
3.17
|
|
3.41
|
|
3.32
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Supplementary data
(in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
Tax benefit on
tax-credit investments (7)
|
(M)
|
$
2,382
|
|
$
2,381
|
|
$
684
|
|
$
1,787
|
|
$
1,374
|
|
|
Non-interest income
charge on tax-credit investments (8)
|
(N)
|
(1,942)
|
|
(1,938)
|
|
(579)
|
|
(1,610)
|
|
(1,112)
|
|
|
Net income on
tax-credit investments
|
(M+N)
|
440
|
|
443
|
|
105
|
|
177
|
|
262
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Intangible
amortization
|
(O)
|
$
1,526
|
|
$
1,475
|
|
$
1,200
|
|
$
1,202
|
|
$
1,218
|
|
|
Fully taxable
equivalent income adjustment
|
(P)
|
1,826
|
|
1,882
|
|
1,809
|
|
1,763
|
|
1,807
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Net securities
(gains)/losses include the change in fair value of the Company's
equity securities in compliance with the Company's adoption of ASU
2016-01.
|
|
(2)
|
Non-GAAP financial
measure.
|
|
|
|
|
|
|
|
|
|
|
|
(3)
|
Total tangible
shareholders' equity is computed by taking total shareholders'
equity less the intangible assets at period-end.
|
|
|
|
|
|
|
Total tangible assets
is computed by taking total assets less the intangible assets at
period-end.
|
|
|
|
|
|
|
|
(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-effected amortization of intangible
assets,
|
|
|
|
|
assuming a 27%
marginal rate, by tangible equity.
|
|
|
|
|
|
|
|
|
|
|
|
(6)
|
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.
|
|
|
|
|
|
|
(7)
|
The tax benefit is
the direct reduction to the income tax provision due to tax credits
and deductions generated from investments in
historic
|
|
|
|
|
rehabilitation and
low-income housing.
|
|
|
|
|
|
|
|
|
|
|
|
(8)
|
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 AND SUPPLEMENTARY DATA - UNAUDITED -
(F-10)
|
|
|
|
At or for the Nine
Months Ended
|
|
|
|
Sept. 30,
|
|
Sept. 30,
|
|
|
(Dollars in
thousands)
|
|
2019
|
|
2018
|
|
|
Net
income
|
|
$
71,699
|
|
$
91,506
|
|
|
Adj: Net
securities(gains)/losses (1)
|
|
(2,655)
|
|
696
|
|
|
Adj: Net (gains) on
sale of business operations and assets
|
|
-
|
|
(460)
|
|
|
Adj: Merger and
acquisition expenses
|
|
15,122
|
|
6,138
|
|
|
Adj: Restructuring
expense and other
|
|
7,211
|
|
-
|
|
|
Adj: (Income)/loss
from discontinued operations before income taxes
|
|
(3,975)
|
|
883
|
|
|
Adj: Income
taxes
|
|
(3,889)
|
|
(1,917)
|
|
|
Total core income
(2)
|
(A)
|
$
83,513
|
|
$
96,846
|
|
|
|
|
|
|
|
|
|
Total revenue from
continuing operations
|
|
$
334,565
|
|
$
321,983
|
|
|
Adj: Net
securities(gains)/losses (1)
|
|
(2,655)
|
|
696
|
|
|
Adj: Net (gains) on
sale of business operations and assets
|
|
-
|
|
(460)
|
|
|
Total core
revenue(2)
|
(B)
|
$
331,910
|
|
$
322,219
|
|
|
Total non-interest
expense from continuing operations
|
|
$
219,570
|
|
$
186,520
|
|
|
Less: Merger,
restructuring and other expense (see above)
|
|
(22,333)
|
|
(6,138)
|
|
|
Core non-interest
expense
(2)
|
(C)
|
$
197,237
|
|
$
180,382
|
|
|
|
|
|
|
|
|
|
(in millions,
except per share data)
|
|
|
|
|
|
|
Total average
assets
|
(D)
|
$
12,857
|
|
$
11,687
|
|
|
Total average
shareholders'
equity
|
(E)
|
1,677
|
|
1,534
|
|
|
Total average
tangible shareholders' equity
(2)
|
(F)
|
1,106
|
|
978
|
|
|
Total average
tangible common shareholders' equity
(2)
|
(G)
|
1,066
|
|
937
|
|
|
Total tangible
shareholders' equity, period-end (2)(3)
|
(H)
|
1,170
|
|
979
|
|
|
Total tangible common
shareholders' equity, period-end (2)(3)
|
(I)
|
1,130
|
|
939
|
|
|
Total tangible
assets, period-end (2)(3)
|
(J)
|
12,930
|
|
11,477
|
|
|
|
|
|
|
|
|
|
Total common shares
outstanding, period-end
(thousands)
|
(K)
|
50,394
|
|
45,420
|
|
|
Average diluted
shares outstanding (thousands)
|
(L)
|
48,987
|
|
46,226
|
|
|
|
|
|
|
|
|
|
Core earnings per
common share, diluted(2)
|
(A/L)
|
$
1.70
|
|
$
2.08
|
|
|
Tangible book value
per common share, period-end (2)
|
(I/K)
|
22.42
|
|
20.68
|
|
|
Total tangible
shareholders' equity/total tangible assets (2)
|
(H)/(J)
|
9.05
|
|
8.53
|
|
|
|
|
|
|
|
|
|
Performance ratios
(4)
|
|
|
|
|
|
|
GAAP return on
assets
|
|
0.74
|
%
|
1.05
|
%
|
|
Core return on assets
(2)
|
(A/D)
|
0.88
|
|
1.12
|
|
|
GAAP return on
equity
|
|
5.70
|
|
7.96
|
|
|
Core return on equity
(2)
|
(A/E)
|
6.64
|
|
8.42
|
|
|
Core return on
tangible common equity (2)(5)
|
(A+O)/(G)
|
10.74
|
|
14.07
|
|
|
Efficiency ratio
(2)(6)
|
(C-O)/(B+M+P)
|
56.30
|
|
53.21
|
|
|
Net interest
margin
|
|
3.19
|
|
3.39
|
|
|
|
|
|
|
|
|
|
Supplementary
data
|
|
|
|
|
|
|
Tax benefit on
tax-credit investments (7)
|
(M)
|
$
5,447
|
|
$
4,089
|
|
|
Non-interest income
charge on tax-credit investments (8)
|
(N)
|
(4,459)
|
|
(3,212)
|
|
|
Net income on
tax-credit investments
|
(M+N)
|
988
|
|
877
|
|
|
|
|
|
|
|
|
|
Intangible
amortization
|
(O)
|
4,201
|
|
3,732
|
|
|
Fully taxable
equivalent income adjustment
|
(P)
|
5,517
|
|
5,660
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Net securities
(gains)/losses include the change in fair value of the Company's
equity securities in compliance with the Company's
adoption
|
|
of ASU
2016-01.
|
(2)
|
Non-GAAP financial
measure.
|
(3)
|
Total tangible
shareholders' equity is computed by taking total shareholders'
equity less the intangible assets at period-end.
|
|
Total tangible assets
is computed by taking total assets less the intangible assets at
period-end.
|
(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)
|
Cor return on
tangible equity is computed by dividing the total core income
adjusted for the tax-effected amortization of
|
|
intangible assets,
assuming a 27% marginal rate, by tangible equity.
|
(6)
|
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.
|
(7)
|
The tax benefit is
the direct reduction to the income tax provision due to tax credits
and deductions generated from investments in
|
|
historic
rehabilitation and low-income housing.
|
(8)
|
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.