BOSTON, July 20,
2022 /PRNewswire/ -- Berkshire Hills Bancorp, Inc.
(NYSE: BHLB) today reported that second quarter 2022 earnings per
share (EPS) increased by 19% to $0.50
from $0.42 in the prior quarter. The
non-GAAP measure of adjusted EPS also increased by 19% to
$0.51 from $0.43. The improvement was due to loan growth and
higher asset yields, while funding and operating costs were
essentially flat. Compared to the second quarter of 2021, EPS
improved by 16% and adjusted EPS increased by 17%.
SECOND QUARTER FINANCIAL HIGHLIGHTS (Changes are
quarter-over-quarter unless otherwise stated. Non-GAAP
measures are reconciled on pages F-9 and F-10).
- 19% increase in GAAP EPS
- Broad-based increase in total loans compared to first quarter,
measuring 7% based on both end-of-period and average balances
- 3.11% net interest margin, increased from 2.61% in the prior
quarter
- 9% increase in total net revenue
- Flat non-interest expense (stable over last five quarters)
- 0.02% net charge-offs/average loans
- 0.25% non-performing assets/assets – sixth sequential quarterly
improvement
- $100 million investment grade
subordinated debt issuance - first Sustainability Bond issued by a
U.S. community bank
- 9% reduction in period-end shares outstanding year-over-year
reflecting stock buybacks
CEO Nitin Mhatre stated
"Berkshire's bankers continue to
make rapid progress towards delivering on our vision to become a
high-performing, socially responsible community bank in New England
and beyond. Through their efforts, we generated strong growth in
balances across all major loan categories. Deposit and wealth
management fee revenues were the highest in five quarters."
"Our strong balance sheet management discipline, coupled with
growth in high-quality loan originations, drove a substantial
increase in our net interest margin and net interest income.
Non-interest expense was stable, with the result that higher
revenues have led to improved bottom line profitability and a 19%
increase in earnings per share."
Mr. Mhatre concluded, "At quarter-end we completed the
first sustainable bond issuance by a U.S. community bank, which
will support environmental and social projects in our communities
based on our Sustainable Financing Framework. We're pleased
with the strong response from investors and that the issuance was
supported by an investment grade rating from Moody's Investors
Service, which acknowledged our strong financial condition,
improving performance, and conservative risk management. I continue
to be proud of all our employees as we successfully executed the
first year of our BEST strategic transformation plan on target and
with continued momentum towards exceeding the plan's
objectives."
RESULTS OF OPERATIONS
Earnings: Strong second quarter 2022
results were driven by robust loan growth, increased
asset yields, stable funding costs, continued expense discipline
and improved credit performance. The 19% sequential increase
in quarterly EPS reflected positive operating leverage from 9%
revenue growth and stable expenses. EPS similarly increased by 16%
on a year-over-year basis, and included the benefit of share
repurchases. In the most recent quarter, the Company recorded an
8.3% return on tangible common equity and a 0.82% return on assets.
The Company also utilizes the financial measure of Pre-tax
Pre-Provision Net Revenue ("PPNR") to evaluate the results of
operations before the impact of the provision and tax expense. PPNR
measured $29 million in the most
recent quarter, increasing sequentially by 38% and year-over-year
by 2%.
Revenue: Second quarter net interest income
increased by 18% compared to the prior quarter and by 8% compared
to the prior year. The sequential quarter growth was driven by an
increase in the net interest margin to 3.11% from 2.61%, which
reflected the benefit of Berkshire's positive interest rate sensitivity
in the rising interest rate environment. It also benefited from a
balance sheet mix shift, as 7% growth in average loans was
funded by lower yielding cash and securities. Reflecting increases
in the Prime and LIBOR index rates for variable rate loans, the
loan yield increased quarter-over-quarter to 3.99% from 3.61%. The
yield on average earning assets improved to 3.34% from 2.82%.
The cost of funds increased to 0.24% from 0.23%, while the cost
of deposits was unchanged at 0.17% compared to the prior quarter.
The Company's interest rate sensitivity remained positive at
midyear 2022 and was positioned to benefit from further interest
rate increases anticipated by the market in the second half of the
year.
Non-interest income excluding securities gains and losses
decreased by 19% quarter-over-quarter and 23% year-over-year.
Excluding insurance operations sold in the third quarter of 2021,
the year-over-year decrease measured 14%. Loan related fees were
impacted by lower commercial loan interest rate swap revenue and
adjustments on fair valued financial instruments in the rising rate
environment. Deposit and wealth management fees increased for these
periods, reflecting solid ongoing growth.
Provision for Credit Losses on Loans: Berkshire recorded no provision for credit
losses in the second quarter of 2022 and 2021. The Company recorded
a $4 million benefit in the first
quarter of 2022. The Company continues to maintain strong credit
quality, and the allowance for credit losses on loans was unchanged
at $99 million compared to the linked
quarter.
Non-Interest Expense: Berkshire has maintained non-interest expense
generally stable over the last five quarters. Berkshire's strategy to self-fund its BEST
plan continues to be driven by investments in bankers and
technology funded by cost saves from branch sales, consolidations,
sale of insurance operations and other optimization
initiatives. The second quarter efficiency ratio improved
sequentially to 66.6% from 72.6%. Full time equivalent staff
totaled 1,322 positions at period-end, compared to 1,319 positions
at the start of the year. The effective tax rate was 21% in the
most recent quarter, which was an increase from 20% for the year
2021, reflecting the increase in pre-tax profitability for the
year-to-date.
BALANCE SHEET (references are to period-end balances
unless otherwise stated)
Summary: Short-term and long-term investments were
used to fund a $0.5 billion increase
in loans, with growth in all major categories. Liquidity and
capital remained strong, with loans/deposits measuring 77% at
midyear and tangible common equity/tangible assets measuring 8.5%.
The common equity tier 1 capital ratio measured 12.9% at that
date.
Loans: Total loans increased by 7%
quarter-over-quarter and by 8% year-over-year due primarily
to growth in commercial loans and residential mortgages. The
Company's expansion of its lending teams in the second half of 2021
has contributed to increased loan originations. Business
volumes have also benefited from strong market demand, and
prepayments have declined in the prevailing rising rate
environment.
Asset Quality: Asset quality metrics remained
favorable and improving in the second quarter. Non-accruing loans
decreased by 9%, measuring 0.34% of period-end total loans.
Annualized net loan charge-offs measured 0.02% of average loans.
Accruing delinquent loans measured 0.55% of total loans, compared
to 0.63% at the start of the year. The ratio of the allowance
for loan credit losses to total loans decreased
quarter-over-quarter to 1.27% from 1.37% and from 1.65% at midyear
2021.
Deposits and Borrowings: Total deposits decreased
by 5% quarter-over-quarter and increased by 2% year-over-year.
Excluding changes in overnight payroll deposits and planned
reductions in brokered deposits, total deposits decreased by 1%
both quarter-over-quarter and year-over-year, which included the
impact of increased customer spending. The cost of deposits
was unchanged at 0.17% quarter-over-quarter. Total borrowings
increased during the quarter primarily due to the subordinated debt
issuance.
Equity: The $80
million, or 7%, quarter-over-quarter decrease in
shareholders' equity included a $45
net decrease due to after-tax unrealized bond losses caused by
rising interest rates. Stock buybacks in the most recent quarter
totaled $55 million consisting of 2.1
million shares. At midyear, book value per share totaled
$22.15 and tangible book value per
share totaled $21.56.
SUSTAINABLE BOND ISSUANCE
On June 30, 2022, Berkshire completed the sale at par of
$100 million in subordinated notes
bearing interest at a fixed rate of 5.5% for the first five
years. The notes will then reset quarterly to a floating rate
per annum equal to a benchmark rate that is expected to be the
Three-Month Term SOFR plus 249 basis points. The notes have a
ten year final maturity and generally may be called at par after
five years. The Company has existing subordinated notes
bearing interest at 6.875% which are callable at par beginning on
September 28, 2022.
Berkshire is the first public
U.S. community bank holding company with under $150 billion in total assets to issue a
Sustainability Bond. The Company intends to use an amount equal to
the net proceeds of its sustainable bond issuance to finance or
refinance new or existing social and environmental projects
consistent with its Sustainable Financing Framework.
Sustainalytics, a Morningstar Company, and the global leader in
high-quality ESG research, ratings, and data,
has independently verified that Berkshire's Sustainable Financing Framework
"is credible and impactful and in alignment with" International
Capital Market Association (ICMA) guidelines and principles.
MOODY'S RATINGS
Moody's Ratings: Moody's Investors Service
("Moody's"), in a report dated June 21,
2022, assigned Berkshire
and Berkshire Bank (the "Bank") first time ratings. Moody's
assigned the Bank a long-term deposit rating of "A3". In addition,
Moody's assigned the Bank and the Company an investment grade
long-term issuer rating of "Baa3". The rating outlooks are
"Positive" for both the Company and the Bank. On July 6, 2022, Moody's assigned a "Baa3" rating to
the subordinated debt issued by Berkshire.
ESG & CORPORATE RESPONSIBILITY
UPDATE
Berkshire Bank is committed to purpose-driven,
community-centered banking that enhances value for all stakeholders
as it pursues its vision of being a high-performing, leading
socially responsible community bank in New England and beyond.
Learn more about the steps Berkshire is taking
at berkshirebank.com/csr and in its most
recent Corporate Responsibility Report.
Key developments in the quarter include:
- Sustainable Financing Framework: Berkshire unveiled its new Sustainable
Financing Framework which will guide the Company's issuance of
green, social and sustainable financings. Projects supported
through the framework include renewable electricity generation;
green buildings; renewable energy technology, storage and
manufacturing; energy efficiency in commercial, residential and
public buildings; affordable housing; workforce housing; and
financial inclusion and access activities. The Sustainable
Financing Framework will guide the allocation of proceeds from
Berkshire's inaugural $100 million Sustainability Bond which made it
the first U.S. community bank holding company with under
$150 billion in assets to issue a
Sustainability Bond.
- BEST Community Comeback & Comeback Tour: Company
executives completed visits to each of its markets across five
states including every financial center meeting with stakeholders
to highlight its "BEST Community Comeback" commitment. The
multi-year plan focuses on four key areas: fueling small
businesses, community financing and philanthropy, financial access
and empowerment, and funding environmental sustainability. As a
result of the collective efforts of its employees, Berkshire is making steady progress towards
the achievement of its goals. As of quarter end, Berkshire increased its use of renewable
electricity to 99%. Additional information can be found at
berkshirebank.com/comeback.
- Launch of the Center for Women, Wellness and Wealth:
Berkshire launched the Center for
Women, Wellness, and Wealth (CWWW) to provide women with tools to
help create a future enriched with financial stability and
wellness. The Center, through partnerships with community
organizations, specialized experts and thought leaders, will offer
events on wellness and financial planning, philanthropic coaching
and development support, and complimentary portfolio reviews
through Berkshire Bank Wealth Management.
- Xtraordinary Day: The Company completed its signature
Xtraordinary Day of service on June 8
during which the Bank closed its offices for the afternoon to give
back to the community. This year, Berkshire Bank partnered with 39
non-profit organizations and over 1,000 Berkshire Bankers, 80% of
the Company, invested the afternoon volunteering for 46 community
projects across MA, NY, CT, RI, and VT. In total, employees
contributed over 5,000 hours of service.
- Current ESG Performance: The Company maintained its top
22% performance in leading ESG indexes in the U.S. for its
Environmental, Social and Governance (ESG) ratings. As of
June 30, 2022 the Company has ratings
of: MSCI ESG- BBB; ISS ESG Quality Score - Environment: 2, Social:
1, Governance: 2; and Bloomberg ESG Disclosure- 59.62. The Company
is also rated by Sustainalytics. Berkshire has ranked among the top 1% of all
U.S. Banks for ESG in Bloomberg this year, and held the number one
spot at midyear.
INVESTOR CONFERENCE CALL AND INVESTOR PRESENTATION
Berkshire will conduct a conference
call/webcast at 10:00 a.m. eastern
time on Wednesday, July 20, 2022 to discuss 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:
https://ige.netroadshow.com/registration/q4inc/11280/berkshire-hills-bancorp-second-quarter-2022-earnings-conference-call/
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
relations section of Berkshire's
website at 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
844-200-6205 and using participant access code: 227686.
Participants are requested to dial-in a few minutes before the
scheduled start of the call. A telephone replay of the call will be
available for one week by dialing 866-813-9403 and using access
code: 465253. The webcast will be available on Berkshire's
website for an extended period of time.
ABOUT BERKSHIRE HILLS
BANCORP
Berkshire Hills Bancorp is the parent of Berkshire Bank.
The Bank's goal is to be a high-performing, leading socially
responsible community bank in New England, Upstate New York, and
beyond. Berkshire Bank provides business and consumer banking,
mortgage, wealth management, and investment services. Headquartered
in Boston, Berkshire has approximately $11.6 billion in assets and operates 105 branch
offices in New England and New
York, and is a member of the Bloomberg Gender-Equality
Index. To learn more, call 800-773-5601 or follow us on Facebook,
Twitter, Instagram, and LinkedIn.
FORWARD-LOOKING STATEMENTS
This document contains "forward-looking statements" within the
meaning of section 27A of the Securities Act of 1933, as amended,
and section 21E of the Securities Exchange Act of 1934, as amended.
You can identify these statements from the use of the words "may,"
"will," "should," "could," "would," "plan," "potential,"
"estimate," "project," "believe," "intend," "anticipate," "expect,"
"target" and similar expressions. There are many 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. You should not place
undue reliance on forward-looking statements, which reflect our
expectations only as of the date of this document. 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 adjusted earnings
in evaluating operating trends, including components for adjusted
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, other gains/losses,
merger costs, restructuring costs, goodwill impairment, and
discontinued operations. In 2021, the Company recorded a third
quarter net gain of $52 million on
the sale of the Company's insurance subsidiary and the Mid-Atlantic
branch operations. Expense adjustments in the first quarter 2021
were primarily related to branch consolidations. Third quarter 2021
adjustments included Federal Home Loan Bank borrowings prepayment
costs. They also included other restructuring charges for
efficiency initiatives in operations areas including write-downs on
real estate moved to held for sale and severance related to staff
reductions. The fourth quarter 2021 revenue adjustment was
primarily related to trailing revenue on a previously reported
sale, and the expense adjustment was due primarily to branch
restructuring costs. The revenue adjustments in 2022 were related
to fair market value changes in equity and trading investments.
The Company utilizes Adjusted Pre-Provision Net Revenue
("Adjusted PPNR") which measures adjusted income before credit loss
provision and tax expense. PPNR is used by the investment community
due to the volatility and variability across banks related to
credit loss provision expense under the Current Expected Credit
Loss accounting standard. The Company also calculates Adjusted
PPNR/assets in order to utilize the PPNR measure in assessing its
comparative operating profitability.
Non-GAAP 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
adjusted income. The efficiency ratio is adjusted for adjusted
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 Contacts
Kevin Conn, SVP, Investor
Relations & Corporate Development
Email: KAConn@berkshirebank.com
Tel: (617) 641-9206
David Gonci, Capital Markets
Director
Email: dgonci@berkshirebank.com
Tel: (413) 281-1973
Media Contact:
Gary Levante, SVP, Corporate
Responsibility & Communications
Email: glevante@berkshirebank.com
Tel: (413) 447-1737
BERKSHIRE HILLS BANCORP, INC.
SELECTED FINANCIAL HIGHLIGHTS - UNAUDITED -
(F-1)
|
|
|
|
|
|
|
|
|
|
June 30,
|
|
Sept. 30,
|
|
Dec. 31,
|
|
March 31,
|
|
June 30,
|
|
|
|
|
|
2021
|
|
2021
|
|
2021
|
|
2022
|
|
2022
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|
NOMINAL AND PER SHARE DATA
|
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|
Net earnings per common
share, diluted
|
$ 0.43
|
|
$ 1.31
|
|
$ 0.42
|
|
$ 0.42
|
|
$
0.50
|
|
|
|
Adjusted earnings per
common share, diluted (2)
|
0.44
|
|
0.53
|
|
0.42
|
|
0.43
|
|
0.51
|
|
|
|
Net income,
(thousands)
|
21,636
|
|
63,749
|
|
20,248
|
|
20,196
|
|
23,115
|
|
|
|
Adjusted net income,
(thousands) (2)
|
22,104
|
|
25,695
|
|
20,172
|
|
20,789
|
|
23,562
|
|
|
|
Total common shares
outstanding, period-end (thousands)
|
50,453
|
|
48,657
|
|
48,667
|
|
47,792
|
|
45,788
|
|
|
|
Average diluted shares,
(thousands)
|
50,608
|
|
48,744
|
|
48,340
|
|
48,067
|
|
46,102
|
|
|
|
Total book value per
common share, (end of period)
|
23.30
|
|
24.21
|
|
24.30
|
|
22.89
|
|
22.15
|
|
|
|
Tangible book value per
common share, (end of period) (2)
|
22.66
|
|
23.58
|
|
23.69
|
|
22.30
|
|
21.56
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|
|
|
Dividends per common
share
|
0.12
|
|
0.12
|
|
0.12
|
|
0.12
|
|
0.12
|
|
|
|
Full-time equivalent
staff
|
1,417
|
|
1,333
|
|
1,319
|
|
1,333
|
|
1,322
|
|
|
|
|
|
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|
|
|
|
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|
|
PERFORMANCE RATIOS (3)
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|
Return on
equity
|
7.37
|
%
|
22.18
|
%
|
6.86
|
%
|
6.79
|
%
|
7.82
|
%
|
|
|
Adjusted return on
equity (2)
|
7.53
|
|
8.94
|
|
6.83
|
|
6.99
|
|
7.97
|
|
|
|
Return on tangible
common equity (2)
|
7.92
|
|
23.14
|
|
7.37
|
|
7.29
|
|
8.33
|
|
|
|
Adjusted return on
tangible common equity (2)
|
8.08
|
|
9.53
|
|
7.34
|
|
7.49
|
|
8.48
|
|
|
|
Return on
assets
|
0.70
|
|
2.14
|
|
0.71
|
|
0.70
|
|
0.82
|
|
|
|
Adjusted return on
assets (2)
|
0.71
|
|
0.86
|
|
0.71
|
|
0.72
|
|
0.84
|
|
|
|
Net interest margin,
fully taxable equivalent (FTE) (4)(5)
|
2.62
|
|
2.56
|
|
2.60
|
|
2.61
|
|
3.11
|
|
|
|
Efficiency ratio
(2)
|
67.82
|
|
68.76
|
|
71.98
|
|
72.61
|
|
66.60
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FINANCIAL DATA (in millions, end of
period)
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|
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|
|
Total assets
|
|
$ 12,273
|
|
$ 11,846
|
|
$ 11,555
|
|
$ 12,097
|
|
$
11,579
|
|
|
|
Total earning
assets
|
11,571
|
|
11,145
|
|
10,899
|
|
11,401
|
|
10,849
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|
|
|
Total loans
|
|
7,233
|
|
6,836
|
|
6,826
|
|
7,267
|
|
7,803
|
|
|
|
Total
deposits
|
|
9,914
|
|
10,365
|
|
10,069
|
|
10,699
|
|
10,115
|
|
|
|
Loans/deposits
(%)
|
73
|
%
|
66
|
%
|
68
|
%
|
68
|
%
|
77
|
%
|
|
|
Total shareholders'
equity
|
$
1,175
|
|
$
1,178
|
|
$
1,182
|
|
$
1,094
|
|
$
1,014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ASSET QUALITY
|
|
|
|
|
|
|
|
|
|
|
|
|
Allowance for credit
losses, (millions)
|
$ 119
|
|
$ 113
|
|
$ 106
|
|
$
99
|
|
$
99
|
|
|
|
Net charge-offs,
(millions)
|
(5)
|
|
(2)
|
|
(4)
|
|
(3)
|
|
(0)
|
|
|
|
Net charge-offs (QTD
annualized)/average loans
|
0.26
|
%
|
0.12
|
%
|
0.23
|
%
|
0.15
|
%
|
0.02
|
%
|
|
|
Provision
expense/(income), (millions)
|
$
-
|
|
$
(4)
|
|
$
(3)
|
|
$
(4)
|
|
$
-
|
|
|
|
Non-performing assets,
(millions)
|
49
|
|
39
|
|
37
|
|
32
|
|
29
|
|
|
|
Non-performing
loans/total loans
|
0.66
|
%
|
0.54
|
%
|
0.52
|
%
|
0.41
|
%
|
0.34
|
%
|
|
|
Allowance for credit
losses/non-performing loans
|
250
|
|
304
|
|
300
|
|
335
|
|
368
|
|
|
|
Allowance for credit
losses/total loans
|
1.65
|
|
1.65
|
|
1.55
|
|
1.37
|
|
1.27
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CAPITAL RATIOS
|
|
|
|
|
|
|
|
|
|
|
|
|
Common equity tier 1
capital to risk weighted assets(6)
|
14.3
|
%
|
15.3
|
%
|
15.0
|
%
|
13.9
|
%
|
12.9
|
%
|
|
|
Tier 1 capital leverage
ratio(6)
|
9.5
|
|
9.9
|
|
10.5
|
|
10.3
|
|
10.2
|
|
|
|
Tangible common
shareholders' equity/tangible assets(2)
|
9.3
|
|
9.7
|
|
10.0
|
|
8.8
|
|
8.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Reconciliations of
non-GAAP financial measures, including all references to adjusted
and tangible amounts, appear on pages F-9 and F-10.
|
|
(2)
|
Non-GAAP financial
measure. adjusted measurements are non-GAAP financial measures that
are adjusted to exclude net non-adjusted charges primarily related
to acquisitions and restructuring activities. See pages F-9 and
F-10 for reconciliations of non-GAAP financial measures.
|
|
(3)
|
All performance ratios
are annualized and are based on average balance sheet amounts,
where applicable.
|
|
|
|
|
|
(4)
|
Fully taxable
equivalent considers the impact of tax advantaged investment
securities and loans.
|
|
|
|
|
|
|
|
(5)
|
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 earliest
quarter and ending with the most recent quarter: 0.08%, 0.06%,
0.06%, 0.03%, 0.03%
|
|
(6)
|
Presented as projected
for June 30, 2022 and actual for the remaining periods.
|
|
|
|
|
|
|
|
|
|
BERKSHIRE HILLS BANCORP, INC.
CONSOLIDATED BALANCE SHEETS - UNAUDITED -
(F-2)
|
|
June 30,
|
December 31,
|
March 31,
|
June 30,
|
|
(in thousands)
|
2021
|
2021
|
2022
|
2022
|
|
Assets
|
|
|
|
|
|
Cash and due from
banks
|
$
98,262
|
$
109,350
|
$
151,814
|
$
156,470
|
|
Short-term
investments
|
1,728,419
|
1,518,457
|
1,455,437
|
714,547
|
|
Total cash and cash
equivalents
|
1,826,681
|
1,627,807
|
1,607,251
|
871,017
|
|
|
|
|
|
|
|
Trading
security
|
8,853
|
8,354
|
7,798
|
7,040
|
|
Marketable equity
securities, at fair value
|
15,709
|
15,453
|
14,719
|
14,154
|
|
Securities available
for sale, at fair value
|
1,640,512
|
1,877,585
|
2,032,575
|
1,697,019
|
|
Securities held to
maturity, at amortized cost
|
665,786
|
636,503
|
612,174
|
602,611
|
|
Federal Home Loan Bank
stock and other restricted securities
|
19,638
|
10,800
|
10,829
|
9,365
|
|
Total
securities
|
2,350,498
|
2,548,695
|
2,678,095
|
2,330,189
|
|
Less: Allowance for
credit losses on investment securities
|
(130)
|
(105)
|
(99)
|
(94)
|
|
Net
securities
|
2,350,368
|
2,548,590
|
2,677,996
|
2,330,095
|
|
|
|
|
|
|
|
Loans held for
sale
|
6,494
|
6,110
|
300
|
1,062
|
|
|
|
|
|
|
|
Total loans
|
7,232,591
|
6,825,847
|
7,267,323
|
7,803,451
|
|
Less: Allowance for
credit losses on loans
|
(119,044)
|
(106,094)
|
(99,475)
|
(99,021)
|
|
Net loans
|
7,113,547
|
6,719,753
|
7,167,848
|
7,704,430
|
|
|
|
|
|
|
|
Premises and equipment,
net
|
104,680
|
94,383
|
92,971
|
89,657
|
|
Other real estate
owned
|
85
|
-
|
-
|
-
|
|
Goodwill and other
intangible assets
|
32,203
|
29,619
|
28,332
|
27,046
|
|
Other assets
|
562,691
|
524,074
|
518,322
|
550,275
|
|
Assets held for sale
(1)
|
276,576
|
4,577
|
3,988
|
5,386
|
|
Total assets
|
$
12,273,325
|
$
11,554,913
|
$
12,097,008
|
$
11,578,968
|
|
|
|
|
|
|
|
Liabilities and shareholders'
equity
|
|
|
|
|
|
Demand
deposits
|
$
2,819,012
|
$
3,008,461
|
$
3,020,568
|
$
2,921,347
|
|
NOW and other
deposits
|
1,696,762
|
976,401
|
2,546,799
|
2,247,544
|
|
Money market
deposits
|
2,398,256
|
3,293,526
|
2,469,042
|
2,327,004
|
|
Savings
deposits
|
1,065,428
|
1,111,625
|
1,133,877
|
1,143,352
|
|
Time
deposits
|
1,934,442
|
1,678,940
|
1,528,922
|
1,475,417
|
|
Total
deposits
|
9,913,900
|
10,068,953
|
10,699,208
|
10,114,664
|
|
|
|
|
|
|
|
Senior
borrowings
|
217,847
|
13,331
|
14,563
|
58,542
|
|
Subordinated
borrowings
|
97,396
|
97,513
|
97,569
|
195,659
|
|
Total
borrowings
|
315,243
|
110,844
|
112,132
|
254,201
|
|
|
|
|
|
|
|
Other
liabilities
|
222,105
|
192,681
|
191,807
|
196,053
|
|
Liabilities held for
sale (1)
|
646,688
|
-
|
-
|
-
|
|
Total
liabilities
|
11,097,936
|
10,372,478
|
11,003,147
|
10,564,918
|
|
|
|
|
|
|
|
Preferred shareholders'
equity
|
-
|
-
|
-
|
-
|
|
Common shareholders'
equity
|
1,175,389
|
1,182,435
|
1,093,861
|
1,014,050
|
|
Total shareholders'
equity
|
1,175,389
|
1,182,435
|
1,093,861
|
1,014,050
|
|
Total liabilities and
shareholders' equity
|
$
12,273,325
|
$
11,554,913
|
$
12,097,008
|
$
11,578,968
|
|
(1) For June 30, 2021,
balance includes loans and deposits held for sale relating to the
Mid-Atlantic region branch sale that closed in the third quarter of
2021.
|
|
|
|
BERKSHIRE HILLS BANCORP, INC.
CONSOLIDATED LOAN & DEPOSIT ANALYSIS - UNAUDITED -
(F-3)
LOAN ANALYSIS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Growth %
|
(in millions)
|
|
December 31, 2021
Balance
|
|
March 31, 2022
Balance
|
|
June 30, 2022
Balance
|
|
Quarter ended
June 30, 2022
|
|
Year to
Date
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total commercial real
estate
|
|
$
3,598
|
|
$
3,764
|
|
$
3,920
|
|
4
|
%
|
9
|
%
|
Commercial and
industrial loans
|
|
1,330
|
|
1,397
|
|
1,471
|
|
5
|
|
11
|
|
Total commercial
loans
|
|
4,928
|
|
5,161
|
|
5,391
|
|
4
|
|
9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total residential
mortgages
|
|
1,392
|
|
1,567
|
|
1,819
|
|
16
|
|
31
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Home
equity
|
|
253
|
|
245
|
|
241
|
|
(2)
|
|
(5)
|
|
Auto and
other
|
|
253
|
|
294
|
|
352
|
|
20
|
|
39
|
|
Total consumer
loans
|
|
506
|
|
539
|
|
593
|
|
10
|
|
17
|
|
Total loans
|
|
$
6,826
|
|
$
7,267
|
|
$
7,803
|
|
7
|
%
|
14
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
DEPOSIT ANALYSIS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Growth %
|
(in millions)
|
|
December 31, 2021
Balance
|
|
March 31, 2022
Balance
|
|
June 30, 2022
Balance
|
|
Quarter ended
June 30, 2022
|
|
Year to Date
|
|
Non-interest
bearing
|
|
$
3,008
|
|
$
3,020
|
|
$
2,921
|
|
(3)
|
%
|
(3)
|
%
|
NOW and
other
|
|
976
|
|
2,547
|
|
2,248
|
|
(12)
|
|
130
|
|
Money market
|
|
3,294
|
|
2,469
|
|
2,327
|
|
(6)
|
|
(29)
|
|
Savings
|
|
1,112
|
|
1,134
|
|
1,143
|
|
1
|
|
3
|
|
Time
deposits
|
|
1,679
|
|
1,529
|
|
1,476
|
|
(3)
|
|
(12)
|
|
Total deposits
(1)
|
|
$
10,069
|
|
$
10,699
|
|
$
10,115
|
|
(5)
|
%
|
0
|
%
|
(1) Included in total
deposits are brokered deposits of $112.9 million, $164.8 million,
and $228.1 million at June 30, 2022, March 31,2022, and December
31, 2021, respectively.
|
BERKSHIRE HILLS BANCORP, INC.
CONSOLIDATED STATEMENTS OF INCOME - UNAUDITED -
(F-4)
|
|
Three Months
Ended
|
|
Six Months
Ended
|
|
June 30,
|
|
June 30,
|
(in thousands, except per share
data)
|
2022
|
|
2021
|
|
2022
|
|
2021
|
Interest
income
|
$
87,379
|
|
$
85,364
|
|
$
162,202
|
|
$
173,517
|
Interest
expense
|
6,021
|
|
9,971
|
|
11,781
|
|
23,031
|
Net
interest income, not FTE
|
81,358
|
|
75,393
|
|
150,421
|
|
150,486
|
Non-interest income
|
|
|
|
|
|
|
|
Deposit related
fees
|
8,005
|
|
7,508
|
|
15,356
|
|
14,634
|
Loan fees and
revenue
|
4,623
|
|
7,431
|
|
12,888
|
|
17,677
|
Insurance commissions
and fees
|
-
|
|
2,292
|
|
-
|
|
5,422
|
Wealth management
fees
|
2,775
|
|
2,519
|
|
5,400
|
|
5,291
|
Mortgage banking
fees
|
109
|
|
534
|
|
128
|
|
1,336
|
Other
|
1,812
|
|
2,211
|
|
4,978
|
|
4,359
|
Total non-interest income excluding
(losses)
|
17,324
|
|
22,495
|
|
38,750
|
|
48,719
|
Securities (losses),
net
|
(973)
|
|
(484)
|
|
(1,718)
|
|
(515)
|
Total non-interest
income
|
16,351
|
|
22,011
|
|
37,032
|
|
48,204
|
Total net
revenue
|
97,709
|
|
97,404
|
|
187,453
|
|
198,690
|
Total net revenue
excluding (losses)
|
98,682
|
|
97,888
|
|
189,171
|
|
199,205
|
|
|
|
|
|
|
|
|
Provision (benefit) for
credit losses
|
-
|
|
-
|
|
(4,000)
|
|
6,500
|
Non-interest expense
|
|
|
|
|
|
|
|
Compensation and
benefits
|
37,830
|
|
36,970
|
|
75,351
|
|
75,705
|
Occupancy and
equipment
|
9,438
|
|
10,599
|
|
19,505
|
|
21,623
|
Technology and
communications
|
8,611
|
|
8,214
|
|
17,138
|
|
16,807
|
Professional
services
|
2,913
|
|
3,701
|
|
5,605
|
|
10,315
|
Other
expenses
|
9,648
|
|
9,382
|
|
19,373
|
|
19,084
|
Merger, restructuring
and other non-operating expenses
|
35
|
|
6
|
|
53
|
|
3,492
|
Total non-interest
expense
|
68,475
|
|
68,872
|
|
137,025
|
|
147,026
|
Total non-interest expense excluding merger, restructuring
and other
|
68,440
|
|
68,866
|
|
136,972
|
|
143,534
|
|
|
|
|
|
|
|
|
Income before income
taxes
|
$
29,234
|
|
$
28,532
|
|
$
54,428
|
|
$
45,164
|
Income tax
expense
|
6,119
|
|
6,896
|
|
11,117
|
|
10,497
|
Net income
|
$
23,115
|
|
$
21,636
|
|
$
43,311
|
|
$
34,667
|
|
|
|
|
|
|
|
|
Basic earnings per common share
|
$
0.50
|
|
$
0.43
|
|
$
0.93
|
|
$
0.69
|
Diluted earnings per common
share
|
$
0.50
|
|
$
0.43
|
|
$
0.92
|
|
$
0.69
|
|
|
|
|
|
|
|
|
Weighted average
shares
outstanding:
|
|
|
|
|
|
|
|
Basic
|
45,818
|
|
50,321
|
|
46,733
|
|
50,327
|
Diluted
|
46,102
|
|
50,608
|
|
47,074
|
|
50,588
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BERKSHIRE HILLS BANCORP, INC.
CONSOLIDATED STATEMENTS OF INCOME (5 Quarter Trend) - UNAUDITED -
(F-5)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June 30,
|
|
Sept. 30,
|
|
Dec. 31,
|
|
March 31,
|
|
June 30,
|
|
(in thousands, except per share
data)
|
|
2021
|
|
2021
|
|
2021
|
|
2022
|
|
2022
|
|
Interest
income
|
|
$ 85,364
|
|
$ 79,688
|
|
$ 75,860
|
|
$ 74,823
|
|
$ 87,379
|
|
Interest
expense
|
|
9,971
|
|
08,320
|
|
6,548
|
|
5,760
|
|
6,021
|
|
Net
interest income, not FTE
|
|
75,393
|
|
71,368
|
|
69,312
|
|
69,063
|
|
81,358
|
|
Non-interest
income
|
|
|
|
|
|
|
|
|
|
|
|
Deposit related fees
|
|
7,508
|
|
7,657
|
|
7,522
|
|
7,351
|
|
8,005
|
|
Loan fees and revenue
|
|
7,431
|
|
8,285
|
|
9,098
|
|
8,265
|
|
4,623
|
|
Insurance commissions and
fees
|
|
2,292
|
|
1,581
|
|
-
|
|
-
|
|
-
|
|
Wealth management fees
|
|
2,519
|
|
2,653
|
|
2,586
|
|
2,625
|
|
2,775
|
|
Mortgage banking fees
|
|
534
|
|
461
|
|
259
|
|
19
|
|
109
|
|
Other
|
|
2,211
|
|
1,279
|
|
993
|
|
3,166
|
|
1,812
|
|
Total non-interest income excluding (losses)/gains
|
|
22,495
|
|
21,916
|
|
20,458
|
|
21,426
|
|
17,324
|
|
Securities (losses),
net
|
|
(484)
|
|
(166)
|
|
(106)
|
|
(745)
|
|
(973)
|
|
Gain on sale of business operations and assets,
net
|
|
-
|
|
51,885
|
|
1,057
|
|
-
|
|
-
|
|
Total non-interest
income
|
|
22,011
|
|
73,635
|
|
21,409
|
|
20,681
|
|
16,351
|
|
Total net
revenue
|
|
97,404
|
|
145,003
|
|
90,721
|
|
89,744
|
|
97,709
|
|
Total net revenue excluding
(losses)/gains
|
|
97,888
|
|
93,284
|
|
89,770
|
|
90,489
|
|
98,682
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision (benefit) for
credit losses
|
|
-
|
|
(4,000)
|
|
(3,000)
|
|
(4,000)
|
|
-
|
|
Non-interest expense
|
|
|
|
|
|
|
|
|
|
|
|
Compensation and
benefits
|
|
36,970
|
|
37,068
|
|
37,816
|
|
37,521
|
|
37,830
|
|
Occupancy and
equipment
|
|
10,599
|
|
10,421
|
|
9,738
|
|
10,067
|
|
9,438
|
|
Technology and
communications
|
|
8,214
|
|
8,397
|
|
8,599
|
|
8,527
|
|
8,611
|
|
Professional
services
|
|
3,701
|
|
3,180
|
|
2,365
|
|
2,692
|
|
2,913
|
|
Other
expenses
|
|
9,382
|
|
8,969
|
|
10,025
|
|
9,725
|
|
9,648
|
|
Merger, restructuring
and other non-operating expenses
|
|
6
|
|
1,425
|
|
864
|
|
18
|
|
35
|
|
Total non-interest
expense
|
|
68,872
|
|
69,460
|
|
69,407
|
|
68,550
|
|
68,475
|
|
Total non-interest expense excluding merger, restructuring
and other
|
|
68,866
|
|
68,035
|
|
68,543
|
|
68,532
|
|
68,440
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before income
taxes
|
|
$ 28,532
|
|
$ 79,543
|
|
$ 24,314
|
|
$ 25,194
|
|
$ 29,234
|
|
Income tax
expense
|
|
6,896
|
|
15,794
|
|
4,066
|
|
4,998
|
|
6,119
|
|
Net income
|
|
$
21,636
|
|
$
63,749
|
|
$
20,248
|
|
$
20,196
|
|
$
23,115
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings per
common share
|
|
$
0.43
|
|
$
1.31
|
|
$
0.42
|
|
$
0.42
|
|
$
0.50
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average shares
outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
50,321
|
|
48,395
|
|
47,958
|
|
47,668
|
|
45,818
|
|
Diluted
|
|
50,608
|
|
48,744
|
|
48,340
|
|
48,067
|
|
46,102
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BERKSHIRE HILLS
BANCORP, INC.
AVERAGE BALANCES AND AVERAGE YIELDS AND COSTS - UNAUDITED -
(F-6)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June 30,
2021
|
|
|
Sept. 30,
2021
|
|
|
Dec. 31,
2021
|
|
|
March 31,
2022
|
|
|
June 30,
2022
|
|
|
(in millions)
|
|
Average
Balance
|
Average
Yield/Rate
|
|
|
Average
Balance
|
Average
Yield/Rate
|
|
|
Average
Balance
|
Average
Yield/Rate
|
|
|
Average
Balance
|
Average
Yield/Rate
|
|
|
Average
Balance
|
Average
Yield/Rate
|
|
|
Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Commercial real
estate
|
|
3,625
|
3.46
|
%
|
3,577
|
3.40
|
%
|
3,569
|
3.49
|
%
|
3,651
|
3.35
|
%
|
3,831
|
3.79
|
%
|
Commercial and
industrial loans
|
|
1,605
|
4.74
|
|
|
1,370
|
4.78
|
|
|
1,278
|
4.37
|
|
|
1,373
|
4.14
|
|
|
1,447
|
4.46
|
|
|
Residential
mortgages
|
|
1,604
|
3.79
|
|
|
1,499
|
3.65
|
|
|
1,403
|
3.82
|
|
|
1,436
|
3.56
|
|
|
1,652
|
3.57
|
|
|
Consumer
loans
|
|
582
|
3.80
|
|
|
545
|
3.95
|
|
|
516
|
3.96
|
|
|
514
|
4.24
|
|
|
562
|
5.41
|
|
|
Total loans
(1)
|
|
7,416
|
3.84
|
|
|
6,991
|
3.77
|
|
|
6,766
|
3.76
|
|
|
6,974
|
3.61
|
|
|
7,492
|
3.99
|
|
|
Securities
(2)
|
|
2,259
|
2.17
|
|
|
2,312
|
2.09
|
|
|
2,367
|
2.04
|
|
|
2,649
|
1.95
|
|
|
2,621
|
1.97
|
|
|
Short-term investments
and loans held for sale
|
|
1,750
|
0.10
|
|
|
1,762
|
0.17
|
|
|
1,609
|
0.17
|
|
|
1,202
|
0.17
|
|
|
476
|
0.57
|
|
|
Mid-Atlantic region
loans held for sale
|
|
269
|
3.96
|
|
|
155
|
3.82
|
|
|
-
|
-
|
|
|
-
|
-
|
|
|
-
|
-
|
|
|
Total earning
assets
|
|
11,694
|
2.96
|
|
|
11,220
|
2.86
|
|
|
10,742
|
2.84
|
|
|
10,825
|
2.82
|
|
|
10,589
|
3.34
|
|
|
Goodwill and other
intangible assets
|
|
33
|
|
|
|
31
|
|
|
|
30
|
|
|
|
29
|
|
|
|
27
|
|
|
|
Other assets
|
|
690
|
|
|
|
674
|
|
|
|
655
|
|
|
|
639
|
|
|
|
644
|
|
|
|
Total assets
|
|
12,417
|
|
|
|
11,925
|
|
|
|
11,427
|
|
|
|
11,493
|
|
|
|
11,260
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities and
shareholders' equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NOW and
other
|
|
1,389
|
0.07
|
%
|
1,316
|
0.05
|
%
|
1,331
|
0.05
|
%
|
1,456
|
0.04
|
%
|
1,454
|
0.12
|
%
|
Money market
|
|
2,751
|
0.18
|
|
|
2,716
|
0.16
|
|
|
2,731
|
0.16
|
|
|
2,871
|
0.16
|
|
|
2,811
|
0.19
|
|
|
Savings
|
|
1,054
|
0.05
|
|
|
1,112
|
0.04
|
|
|
1,100
|
0.04
|
|
|
1,117
|
0.03
|
|
|
1,127
|
0.03
|
|
|
Time
|
|
2,013
|
0.94
|
|
|
1,893
|
0.86
|
|
|
1,750
|
0.80
|
|
|
1,624
|
0.71
|
|
|
1,460
|
0.64
|
|
|
Total
interest-bearing deposits
|
|
7,207
|
0.35
|
|
|
7,037
|
0.31
|
|
|
6,912
|
0.28
|
|
|
7,068
|
0.24
|
|
|
6,852
|
0.24
|
|
|
Borrowings
(3)
|
|
392
|
3.12
|
|
|
263
|
3.89
|
|
|
121
|
5.68
|
|
|
122
|
5.21
|
|
|
160
|
4.61
|
|
|
Mid-Atlantic region
interest-bearing deposits
|
|
517
|
0.51
|
|
|
306
|
0.51
|
|
|
-
|
-
|
|
|
-
|
-
|
|
|
-
|
-
|
|
|
Total
interest-bearing liabilities
|
|
8,116
|
0.49
|
|
|
7,606
|
0.43
|
|
|
7,033
|
0.37
|
|
|
7,190
|
0.32
|
|
|
7,012
|
0.34
|
|
|
Non-interest-bearing
demand deposits
|
|
2,787
|
|
|
|
2,901
|
|
|
|
3,038
|
|
|
|
2,968
|
|
|
|
2,903
|
|
|
|
Other liabilities
(4)
|
|
340
|
|
|
|
269
|
|
|
|
175
|
|
|
|
146
|
|
|
|
163
|
|
|
|
Total
liabilities
|
|
11,243
|
|
|
|
10,776
|
|
|
|
10,246
|
|
|
|
10,304
|
|
|
|
10,078
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common shareholders'
equity
|
|
1,174
|
|
|
|
1,149
|
|
|
|
1,181
|
|
|
|
1,189
|
|
|
|
1,182
|
|
|
|
Total shareholders'
equity
|
|
1,174
|
|
|
|
1,149
|
|
|
|
1,181
|
|
|
|
1,189
|
|
|
|
1,182
|
|
|
|
Total liabilities and
shareholders' equity
|
|
12,417
|
|
|
|
11,925
|
|
|
|
11,427
|
|
|
|
11,493
|
|
|
|
11,260
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest
spread
|
|
|
2.47
|
%
|
|
2.43
|
%
|
|
2.47
|
%
|
|
2.50
|
%
|
|
2.99
|
%
|
Net interest margin,
FTE (5)
|
|
|
2.62
|
|
|
|
2.56
|
|
|
|
2.60
|
|
|
|
2.61
|
|
|
|
3.11
|
|
|
Cost of
funds
|
|
|
0.36
|
|
|
|
0.31
|
|
|
|
0.26
|
|
|
|
0.23
|
|
|
|
0.24
|
|
|
Cost of
deposits
|
|
|
0.25
|
|
|
|
0.22
|
|
|
|
0.19
|
|
|
|
0.17
|
|
|
|
0.17
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Supplementary
data
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Interest Income,
not FTE
|
|
75
|
|
|
|
71
|
|
|
|
69
|
|
|
|
69
|
|
|
|
81
|
|
|
|
Fully taxable
equivalent income adjustment
|
|
2
|
|
|
|
2
|
|
|
|
2
|
|
|
|
2
|
|
|
|
2
|
|
|
|
Net Interest Income,
FTE
|
|
77
|
|
|
|
73
|
|
|
|
71
|
|
|
|
71
|
|
|
|
83
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average PPP loans
(6)
|
|
321
|
|
|
|
90
|
|
|
|
37
|
|
|
|
27
|
|
|
|
NM
|
|
|
|
Average loans excluding
PPP loans (6)
|
|
7,095
|
|
|
|
6,901
|
|
|
|
6,729
|
|
|
|
6,947
|
|
|
|
7,492
|
|
|
|
Total PPP loans, end of
period (6)
|
|
173
|
|
|
|
46
|
|
|
|
30
|
|
|
|
16
|
|
|
|
NM
|
|
|
|
Total loans excluding
PPP loans, end of period (6)
|
7,059
|
|
|
|
6,790
|
|
|
|
6,796
|
|
|
|
7,251
|
|
|
|
7,803
|
|
|
|
PPP interest
income
|
|
5
|
|
|
|
2
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total average
non-maturity deposits
|
|
7,981
|
|
|
|
8,045
|
|
|
|
8,200
|
|
|
|
8,412
|
|
|
|
8,295
|
|
|
|
Total average
deposits
|
|
9,994
|
|
|
|
9,938
|
|
|
|
9,950
|
|
|
|
10,037
|
|
|
|
9,755
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Purchased loan
accretion
|
|
2
|
|
|
|
2
|
|
|
|
2
|
|
|
|
1
|
|
|
|
1
|
|
|
|
Total average tangible
equity (7)
|
|
1,141
|
|
|
|
1,118
|
|
|
|
1,151
|
|
|
|
1,160
|
|
|
|
1,155
|
|
|
|
|
|
|
|
(1) Total loans include
non-accruing loans.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(2) Average balances
for securities available-for-sale are based on amortized
cost.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(3) Average balances
for borrowings includes the financing lease obligation which is
presented under other liabilities on the consolidated balance
sheet.
|
|
|
|
|
|
|
(4) Includes the
Mid-Atlantic region non-interesting bearing deposits. As of June
30, 2022, March 31, 2022 and December 31, 2021 there were no
Mid-Atlantic region average non-interest bearing
deposits.
|
(5) The effect of PPP
loans on the quarterly net interest margin is shown sequentially as
follows beginning with the earliest quarter and ending with the
most recent quarter: (0.11%, 0.05%, 0.00%, 0.00%, 0.00%) This
calculation excludes gross interest income on PPP loans and average
PPP loan balances.
|
(6) As of June 30,
2022, the PPP loan balances and interest are not considered
material and will no longer be considered in adjusted
metrics.
|
|
|
|
|
|
|
|
(7) See page F-9 for
details on the calculation of total average tangible
equity.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BERKSHIRE HILLS
BANCORP, INC. ASSET QUALITY ANALYSIS - UNAUDITED -
(F-7)
|
|
|
|
|
June 30,
|
|
Sept. 30,
|
|
Dec. 31,
|
|
March 31,
|
|
June 30,
|
|
(in thousands)
|
2021
|
|
2021
|
|
2021
|
|
2022
|
|
2022
|
|
NON-PERFORMING
ASSETS
|
|
|
|
|
|
|
|
|
|
|
Non-accruing
loans:
|
|
|
|
|
|
|
|
|
|
|
Commercial real
estate
|
$
22,799
|
|
$
14,845
|
|
$
13,954
|
|
$
8,984
|
|
$
8,277
|
|
Commercial and
industrial loans
|
9,427
|
|
7,140
|
|
6,747
|
|
5,618
|
|
4,891
|
|
Residential
mortgages
|
9,238
|
|
9,763
|
|
9,825
|
|
11,079
|
|
10,331
|
|
Consumer
loans
|
6,141
|
|
5,399
|
|
4,800
|
|
4,000
|
|
3,385
|
|
Total non-accruing
loans
|
47,605
|
|
37,147
|
|
35,326
|
|
29,681
|
|
26,884
|
|
Other real estate
owned
|
85
|
|
-
|
|
-
|
|
-
|
|
-
|
|
Repossessed
assets
|
1,666
|
|
1,664
|
|
1,736
|
|
2,004
|
|
2,004
|
|
Total non-performing
assets
|
$
49,356
|
|
$
38,811
|
|
$
37,062
|
|
$
31,685
|
|
$
28,888
|
|
|
|
|
|
|
|
|
|
|
|
|
Total non-accruing
loans/total loans
|
0.66 %
|
|
0.54 %
|
|
0.52 %
|
|
0.41 %
|
|
0.34 %
|
|
Total non-accruing
loans/total loans excluding PPP loans
|
0.67 %
|
|
0.55 %
|
|
0.52 %
|
|
0.42 %
|
|
0.38 %
|
|
Total non-performing
assets/total assets
|
0.40 %
|
|
0.33 %
|
|
0.32 %
|
|
0.26 %
|
|
0.25 %
|
|
|
|
|
|
|
|
|
|
|
|
|
PROVISION AND
ALLOWANCE FOR CREDIT LOSSES ON LOANS
|
|
|
|
|
|
|
|
Balance at beginning of
period
|
$ 123,800
|
|
$ 119,044
|
|
$ 112,916
|
|
$ 106,094
|
|
$
99,475
|
|
Charged-off
loans
|
(7,248)
|
|
(4,334)
|
|
(7,976)
|
|
(6,048)
|
|
(1,593)
|
|
Recoveries on
charged-off loans
|
2,492
|
|
2,206
|
|
4,154
|
|
3,429
|
|
1,139
|
|
Net loans
charged-off
|
(4,756)
|
|
(2,128)
|
|
(3,822)
|
|
(2,619)
|
|
(454)
|
|
Provision (benefit) for
loan credit losses
|
-
|
|
(4,000)
|
|
(3,000)
|
|
(4,000)
|
|
-
|
|
Balance at end of
period
|
$ 119,044
|
|
$ 112,916
|
|
$ 106,094
|
|
$
99,475
|
|
$
99,021
|
|
|
|
|
|
|
|
|
|
|
|
|
Allowance for credit
losses/total loans
|
1.65 %
|
|
1.65 %
|
|
1.55 %
|
|
1.37 %
|
|
1.27 %
|
|
Allowance for credit
losses/total loans excluding PPP loans
|
1.69 %
|
|
1.66 %
|
|
1.56 %
|
|
1.37 %
|
|
1.27 %
|
|
Allowance for credit
losses/non-accruing loans
|
250 %
|
|
304 %
|
|
300 %
|
|
335 %
|
|
368 %
|
|
|
|
|
|
|
|
|
|
|
|
|
NET LOAN
CHARGE-OFFS
|
|
|
|
|
|
|
|
|
|
|
Commercial real
estate
|
$
(2,325)
|
|
$
(1,391)
|
|
$
(2,208)
|
|
$
(3,280)
|
|
$
(76)
|
|
Commercial and
industrial loans
|
(2,331)
|
|
110
|
|
(1,649)
|
|
653
|
|
(237)
|
|
Residential
mortgages
|
176
|
|
(677)
|
|
(2)
|
|
(50)
|
|
(30)
|
|
Home
equity
|
(136)
|
|
106
|
|
106
|
|
135
|
|
33
|
|
Auto and other
consumer
|
(140)
|
|
(276)
|
|
(69)
|
|
(77)
|
|
(144)
|
|
Total, net
|
$
(4,756)
|
|
$
(2,128)
|
|
$
(3,822)
|
|
$
(2,619)
|
|
$
(454)
|
|
|
|
|
|
|
|
|
|
|
|
|
Net charge-offs (QTD
annualized)/average loans
|
0.26 %
|
|
0.12 %
|
|
0.23 %
|
|
0.15 %
|
|
0.02 %
|
|
Net charge-offs (YTD
annualized)/average loans
|
0.39 %
|
|
0.30 %
|
|
0.29 %
|
|
0.15 %
|
|
0.08 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BERKSHIRE HILLS BANCORP, INC.
ASSET QUALITY ANALYSIS - UNAUDITED (F-8)
|
|
|
|
|
|
|
|
June 30,
2021
|
|
September 30,
2021
|
December 31,
2021
|
|
March 31,
2022
|
|
June 30,
2022
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in thousands)
|
|
Balance
|
|
Percent of Total
Loans
|
|
Balance
|
Percent of Total
Loans
|
|
Balance
|
|
Percent of Total
Loans
|
|
Balance
|
|
Percent of Total
Loans
|
|
Balance
|
|
Percent of Total
Loans
|
|
30-89 Days
delinquent
|
|
$ 15,483
|
|
0.22 %
|
|
$ 18,365
|
0.27 %
|
|
$ 39,863
|
|
0.58 %
|
|
$ 13,517
|
|
0.19 %
|
|
$ 36,184
|
|
0.46 %
|
|
90+ Days delinquent and
still accruing
|
|
3,129
|
|
0.04 %
|
|
3,803
|
0.06 %
|
|
3,270
|
|
0.05 %
|
|
6,613
|
|
0.09 %
|
|
6,760
|
|
0.09 %
|
|
Total accruing
delinquent loans
|
|
18,612
|
|
0.26 %
|
|
22,168
|
0.33 %
|
|
43,133
|
|
0.63 %
|
|
20,130
|
|
0.28 %
|
|
42,944
|
|
0.55 %
|
|
Non-accruing
loans
|
|
47,605
|
|
0.66 %
|
|
37,147
|
0.54 %
|
|
35,326
|
|
0.52 %
|
|
29,681
|
|
0.41 %
|
|
26,884
|
|
0.34 %
|
|
Total delinquent and
non-accruing loans
|
|
$ 66,217
|
|
0.92 %
|
|
$ 59,315
|
0.87 %
|
|
$ 78,459
|
|
1.15 %
|
|
$ 49,811
|
|
0.69 %
|
|
$ 69,828
|
|
0.89 %
|
|
|
BERKSHIRE HILLS BANCORP, INC.
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES AND SUPPLEMENTARY
DATA- UNAUDITED - (F-9)
|
|
|
|
|
|
June 30,
|
|
Sept. 30,
|
|
Dec. 31,
|
|
March 31,
|
|
June 30,
|
|
(in thousands)
|
|
2021
|
|
2021
|
|
2021
|
|
2022
|
|
2022
|
|
Total
revenue
|
(A)
|
$ 97,404
|
|
$
145,003
|
|
$
90,721
|
|
$
89,744
|
|
$ 97,709
|
|
Adj: Net securities
losses (1)
|
|
484
|
|
166
|
|
106
|
|
745
|
|
973
|
|
Adj: Net (gains) on
sale of business operations and assets
|
|
-
|
|
(51,885)
|
|
(1,057)
|
|
-
|
|
-
|
|
Total adjusted revenue
(2)
|
(B)
|
$ 97,888
|
|
$ 93,284
|
|
$
89,770
|
|
$
90,489
|
|
$ 98,682
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total non-interest
expense
|
(C)
|
$ 68,872
|
|
$ 69,460
|
|
$
69,407
|
|
$
68,550
|
|
$ 68,475
|
|
Less: Merger,
restructuring and other expense
|
|
(6)
|
|
(1,425)
|
|
(864)
|
|
(18)
|
|
(35)
|
|
Adjusted non-interest
expense (2)
|
(D)
|
$ 68,866
|
|
$ 68,035
|
|
$
68,543
|
|
$
68,532
|
|
$ 68,440
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pre-tax, pre-provision
net revenue (PPNR)
|
(A-C)
|
$ 28,532
|
|
$ 75,543
|
|
$
21,314
|
|
$
21,194
|
|
$ 29,234
|
|
Adjusted pre-tax,
pre-provision net revenue (PPNR)
|
(B-D)
|
29,022
|
|
25,249
|
|
21,227
|
|
21,957
|
|
30,242
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
|
$ 21,636
|
|
$ 63,749
|
|
$
20,248
|
|
$
20,196
|
|
$ 23,115
|
|
Adj: Net securities
losses (1)
|
|
484
|
|
166
|
|
106
|
|
745
|
|
973
|
|
Adj: Net (gains) on
sale of business operations and assets
|
|
-
|
|
(51,885)
|
|
(1,057)
|
|
-
|
|
-
|
|
Adj: Restructuring
expense and other expense
|
|
6
|
|
1,425
|
|
864
|
|
18
|
|
35
|
|
Adj: Income taxes
(expense)/benefit
|
|
(22)
|
|
12,240
|
|
11
|
|
(170)
|
|
(561)
|
|
Total adjusted income
(2)
|
(E)
|
$ 22,104
|
|
$ 25,695
|
|
$
20,172
|
|
$
20,789
|
|
$ 23,562
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in millions, except
per share data)
|
|
|
|
|
|
|
|
|
|
|
|
Total average
assets
|
(F)
|
$ 12,417
|
|
$ 11,925
|
|
$
11,427
|
|
$
11,493
|
|
$ 11,260
|
|
Total average
shareholders'
equity
|
(G)
|
1,174
|
|
1,149
|
|
1,181
|
|
1,189
|
|
1,182
|
|
Total average tangible
shareholders' equity
(2)(3)
|
(H)
|
1,141
|
|
1,118
|
|
1,151
|
|
1,160
|
|
1,155
|
|
Total average tangible
common shareholders' equity
(2)(3)
|
(I)
|
1,141
|
|
1,118
|
|
1,151
|
|
1,160
|
|
1,155
|
|
Total tangible
shareholders' equity, period-end (2)(3)
|
(J)
|
1,143
|
|
1,147
|
|
1,153
|
|
1,066
|
|
987
|
|
Total tangible common
shareholders' equity, period-end (2)(3)
|
(K)
|
1,143
|
|
1,147
|
|
1,153
|
|
1,066
|
|
987
|
|
Total tangible assets,
period-end (2)(3)
|
(L)
|
12,241
|
|
11,815
|
|
11,525
|
|
12,069
|
|
11,552
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total common shares
outstanding, period-end
(thousands)
|
(M)
|
50,453
|
|
48,657
|
|
48,667
|
|
47,792
|
|
45,788
|
|
Average diluted shares
outstanding (thousands)
|
(N)
|
50,608
|
|
48,744
|
|
48,340
|
|
48,067
|
|
46,102
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP earnings per
common share, diluted (2)
|
|
$
0.43
|
|
$
1.31
|
|
$
0.42
|
|
$
0.42
|
|
$
0.50
|
|
Adjusted earnings per
common share, diluted (2)
|
(E/N)
|
0.44
|
|
0.53
|
|
0.42
|
|
0.43
|
|
0.51
|
|
Tangible book value per
common share, period-end (2)
|
(K/M)
|
22.66
|
|
23.58
|
|
23.69
|
|
22.30
|
|
21.56
|
|
Total tangible
shareholders' equity/total tangible assets (2)
|
(J/L)
|
9.34
|
|
9.71
|
|
10.00
|
|
8.83
|
|
8.54
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Performance ratios
(4)
|
|
|
|
|
|
|
|
|
|
|
|
GAAP return on
equity
|
|
7.37
|
%
|
22.18
|
%
|
6.86
|
%
|
6.79
|
|
7.82
|
%
|
Adjusted return on
equity (2)
|
(E/G)
|
7.53
|
|
8.94
|
|
6.83
|
|
6.99
|
|
7.97
|
|
Return on tangible
common equity (2)(5)
|
|
7.92
|
|
23.14
|
|
7.37
|
|
7.29
|
|
8.33
|
|
Adjusted return on
tangible common equity (2)(5)
|
(E+Q)/(I)
|
8.08
|
|
9.53
|
|
7.34
|
|
7.49
|
|
8.48
|
|
GAAP return on
assets
|
|
0.70
|
|
2.14
|
|
0.71
|
|
0.70
|
|
0.82
|
|
Adjusted return on
assets (2)
|
|
0.71
|
|
0.86
|
|
0.71
|
|
0.72
|
|
0.84
|
|
PPNR from continuing
operations/assets (2)
|
|
0.92
|
|
2.53
|
|
0.75
|
|
0.74
|
|
1.04
|
|
Adjusted PPNR/assets
(2)
|
|
0.93
|
|
0.85
|
|
0.74
|
|
0.76
|
|
1.07
|
|
Efficiency ratio
(2)(6)
|
(D-Q)/(B+O+R)
|
67.82
|
|
68.76
|
|
71.98
|
|
72.61
|
|
66.60
|
|
Net interest margin,
FTE
|
|
2.62
|
|
2.56
|
|
2.60
|
|
2.61
|
|
3.11
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Supplementary data (in
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
Tax benefit on
tax-credit investments (7)
|
(O)
|
$
79
|
|
$
2,195
|
|
$ 2,057
|
|
$
596
|
|
$
595
|
|
Non-interest income
charge on tax-credit investments (8)
|
(P)
|
(175)
|
|
(1,789)
|
|
(1,448)
|
|
(357)
|
|
(351)
|
|
Net income on
tax-credit investments
|
(O+P)
|
(96)
|
|
406
|
|
609
|
|
239
|
|
244
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Intangible
amortization
|
(Q)
|
$
1,297
|
|
$
1,296
|
|
$ 1,288
|
|
$ 1,286
|
|
$
1,286
|
|
Fully taxable
equivalent income adjustment
|
(R)
|
1,660
|
|
1,586
|
|
1,604
|
|
1,524
|
|
1,560
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Net securities
losses/(gains) 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 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) Adjusted return on
tangible equity is computed by dividing the total adjusted
income/(loss) 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 adjusted tangible non-interest expense
by the sum of total net interest income on a fully taxable
equivalent basis and total adjusted 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 Six
Months Ended
|
|
|
|
June 30,
|
|
June 30,
|
|
(in thousands)
|
|
|
2021
|
|
2022
|
|
Total
revenue
|
(A)
|
|
$
198,690
|
|
$
187,453
|
|
Adj: Net securities
losses (1)
|
|
|
515
|
|
1,718
|
|
Total adjusted revenue
(2)
|
(B)
|
|
$
199,205
|
|
$
189,171
|
|
|
|
|
|
|
|
|
Total non-interest
expense
|
(C)
|
|
$
147,026
|
|
$
137,025
|
|
Less: Merger,
restructuring and other expense
|
|
|
(3,492)
|
|
(53)
|
|
Adjusted non-interest
expense (2)
|
(D)
|
|
$
143,534
|
|
$
136,972
|
|
|
|
|
|
|
|
|
Pre-tax, pre-provision
net revenue (PPNR)
|
(A-C)
|
|
$
51,664
|
|
$
50,428
|
|
Adjusted pre-tax,
pre-provision net revenue (PPNR)
|
(B-D)
|
|
55,671
|
|
52,199
|
|
|
|
|
|
|
|
|
Net income
|
|
|
$
34,667
|
|
$
43,311
|
|
Adj: Net securities
losses (1)
|
|
|
515
|
|
1,718
|
|
Adj: Restructuring
expense and other expense
|
|
|
3,492
|
|
53
|
|
Adj: Income taxes
benefit/(expense)
|
|
|
(555)
|
|
(731)
|
|
Total adjusted
income/(loss) (2)
|
(E)
|
|
$
38,119
|
|
$
44,351
|
|
|
|
|
|
|
|
|
(in millions, except per share
data)
|
|
|
|
|
|
|
Total average
assets
|
(F)
|
|
$
12,442
|
|
$
11,376
|
|
Total average
shareholders'
equity
|
(G)
|
|
1,166
|
|
1,185
|
|
Total average tangible
shareholders' equity
(2)(3)
|
(H)
|
|
1,133
|
|
1,157
|
|
Total average tangible
common shareholders' equity
(2)(3)
|
(I)
|
|
1,133
|
|
1,157
|
|
Total tangible
shareholders' equity, period-end (2)(3)
|
(J)
|
|
1,143
|
|
987
|
|
Total tangible common
shareholders' equity, period-end (2)(3)
|
(K)
|
|
1,143
|
|
987
|
|
Total tangible assets,
period-end (2)(3)
|
(L)
|
|
12,241
|
|
11,552
|
|
|
|
|
|
|
|
|
Total common shares
outstanding, period-end
(thousands)
|
(M)
|
|
50,453
|
|
45,788
|
|
Average diluted shares
outstanding (thousands)
|
(N)
|
|
50,588
|
|
47,074
|
|
|
|
|
|
|
|
|
GAAP earnings/(loss)
per common share, diluted (2)
|
|
|
$
0.69
|
|
$
0.92
|
|
Adjusted earnings per
common share, diluted (2)
|
(E/N)
|
|
0.75
|
|
0.94
|
|
Tangible book value per
common share, period-end (2)
|
(K/M)
|
|
22.66
|
|
21.56
|
|
Total tangible
shareholders' equity/total tangible assets (2)
|
(J/L)
|
|
9.34
|
|
8.54
|
|
|
|
|
|
|
|
|
Performance ratios (4)
|
|
|
|
|
|
|
GAAP return on
equity
|
|
|
5.95
|
%
|
7.31
|
%
|
Adjusted return on
equity (2)
|
(E/G)
|
|
6.54
|
|
7.49
|
|
Return on tangible
common equity (2)(5)
|
|
|
6.46
|
|
7.81
|
|
Adjusted return on
tangible common equity (2)(5)
|
(E+Q)/(I)
|
|
7.07
|
|
7.99
|
|
GAAP return on
assets
|
|
|
0.56
|
|
0.76
|
|
Adjusted return on
assets (2)
|
|
|
0.61
|
|
0.78
|
|
PPNR from continuing
operations/assets (2)
|
|
|
0.83
|
|
0.89
|
|
Adjusted PPNR/assets
(2)
|
|
|
0.89
|
|
0.92
|
|
Efficiency ratio
(2)(6)
|
(D-Q)/(B+O+R)
|
|
69.60
|
|
69.48
|
|
Net interest margin,
FTE
|
|
|
2.62
|
|
2.86
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Supplementary
data (in
thousands)
|
|
|
|
|
|
|
Tax benefit on
tax-credit investments (7)
|
(O)
|
|
$
120
|
|
$
1,191
|
|
Non-interest income
charge on tax-credit investments (8)
|
(P)
|
|
(207)
|
|
(708)
|
|
Net income on
tax-credit investments
|
(O+P)
|
|
(87)
|
|
483
|
|
|
|
|
|
|
|
|
Intangible
amortization
|
(Q)
|
|
$
2,616
|
|
$
2,572
|
|
Fully taxable
equivalent income adjustment
|
(R)
|
|
3,154
|
|
3,084
|
|
|
|
|
|
|
|
|
___________________________________________________________________________________________________________________________________
|
(1) Net securities
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 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) Adjusted return on
tangible equity is computed by dividing the total adjusted
income/(loss) 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 adjusted tangible non-interest expense
by the sum of total net interest income on a fully taxable
equivalent basis and total adjusted 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.