BOSTON, Oct. 20,
2022 /PRNewswire/ -- Berkshire Hills Bancorp, Inc.
(NYSE: BHLB) today reported third quarter 2022 earnings per share
("EPS") totaling $0.42. The
non-GAAP measure of adjusted EPS totaled $0.62 for this period.
GAAP EPS decreased from $0.50 in
the prior quarter due to $11 million
in third quarter charges primarily consisting of branch
restructuring costs following the completion of the previously
announced branch consolidation program.
Excluding these charges, adjusted EPS increased by 21% from
$0.51 in the prior quarter.
Results benefited from a 13% increase in net interest income driven
by a 37 basis point increase in the net interest margin due to loan
growth and higher market interest rates.
Third quarter GAAP EPS decreased from $1.31 in 2021 due to $52
million in gains recorded on the sale of branch and
insurance operations in 2021. Excluding these gains, adjusted
EPS increased year-over-year by 18%. Berkshire's 2022 results demonstrate positive
operating leverage from its BEST strategic transformation
initiatives.
THIRD QUARTER FINANCIAL HIGHLIGHTS (Changes are
quarter-over-quarter unless otherwise stated. Non-GAAP
measures are reconciled on pages F-9 and F-10).
- 6.8% return on tangible common equity and 9.9% adjusted return
on tangible common equity
- 11% increase quarter-over-quarter in total net revenue; 10%
increase in adjusted net revenue
- 3.48% net interest margin, increased from 3.11% in 2Q22 and
2.56% in 3Q21
- 62% efficiency ratio, improved from 67% in 2Q22 and 69% in
3Q21
- 2% end-of-period loan growth quarter-over-quarter; 16% growth
year-over-year
- 0.74% delinquent and non-accrual loans/loans
- 7% reduction in period-end shares outstanding year-over-year
reflecting stock buybacks
- Prepayment of $75 million in
subordinated debt in September
2022
CEO Nitin Mhatre stated
"Berkshire posted strong revenue
growth in the third quarter and achieved the highest adjusted per
share earnings since 2019. We're ahead of our BEST strategic
transformation plan targets for performance improvement and
accelerating our progress towards our vision of becoming a
high-performing, leading socially responsible community bank."
"Berkshire posted another
quarter of loan growth and asset quality remains strong. Our
balance sheet remains positioned to benefit from further increases
in market interest rates. The Company's expense discipline
continues to support positive operating leverage and improved
efficiency, allowing us to reinvest in targeted business
lines. Our focused capital management has improved our
capital returns to shareholders while also maintaining a strong
capital base to support further franchise growth."
Mr. Mhatre concluded, "We continue to evolve our organization to
meet shifting consumer, business, community, and employee
expectations while enhancing our DigitouchSM model
of customer engagement. We've increased our base pay rates,
announced a number of promotions, and continue targeted recruiting
of frontline bankers. Our teams are finding opportunities to
add new relationships in the changing local banking
landscape. We're making steady progress in our multi-billion
BEST Community Comeback program along with our ESG activities and
are encouraged by the ongoing momentum within our organization and
communities."
RESULTS OF OPERATIONS
Earnings: Third quarter EPS of $0.42 decreased from $0.50 quarter-over-quarter, while adjusted EPS
increased by 21% to $0.62 from
$0.51. Third quarter EPS decreased
from $1.31 in 2021 due to gains
recorded on the sale of business operations in 2021. Third quarter
adjusted EPS increased from $0.53 in
2021.
The improvement in adjusted earnings reflects positive operating
leverage, with 11% revenue growth and 3% growth in adjusted
operating expense compared to the prior quarter. The
efficiency ratio improved to 62% in the most recent quarter,
compared to 67% in the linked quarter and to 69% in the third
quarter of 2021.
The third quarter 2022 return on tangible common equity measured
6.8% and the non-GAAP measure of adjusted return on tangible common
equity measured 9.9%, The return on assets measured 0.66% and the
non-GAAP measure of adjusted return on assets measured 0.99%.
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.
Compared to the prior quarter, PPNR decreased by $2 million to $27
million due to the restructuring expenses. The
non-GAAP measure of adjusted PPNR increased by 28% to $39 million. Adjusted PPNR increased by 53% on a
year-over-year basis.
Earnings per share benefited from share repurchases in most
quarters during 2021 and 2022. At period-end, the Company had
approximately $35 million remaining
in its 2022 share repurchase authorization.
Revenue and expense comparisons to the third quarter of 2021
include the impact of the sale of branch and insurance operations
at the end of that period. Revenue and expense related to
those operations were components of operating income in that period
and in prior periods.
Revenue: Total net revenue increased by 11%
quarter-over-quarter and decreased by 25% year-over-year, due to
the gains recorded on the sale of operations in the third quarter
of 2021. The Company's non-GAAP measure of adjusted
revenue increased by 10% and 17% for the above periods.
Net interest income has been the primary driver of revenue
growth in recent periods. Third quarter net interest income
increased by $11 million, or 13%,
compared to the linked quarter and by $21
million, or 29%, compared to the third quarter of
2021. After several quarters of relative stability, including
a 2.56% margin in the third quarter of 2021, the margin expanded
strongly to 3.11% in the second quarter of 2022, and then rose
further to 3.48% in the third quarter of 2022.
This improvement primarily reflected the impact of rapidly
rising market interest rates which the Company was positioned to
benefit from due to the positive asset sensitivity of its balance
sheet. The margin also reflected the benefit of the reduction
in higher cost wholesale funds as well as the reinvestment of
excess cash into loan growth. The interest margin has also
benefited from a lag in the responsiveness of deposit costs to the
initial upward move in market interest rates.
The yield on average earning assets improved
quarter-over-quarter to 3.91% from 3.34%. The cost of funds
increased to 0.46% from 0.24%, while the cost of deposits increased
to 0.33% from 0.17%. The Company's interest rate sensitivity
remained positive at period-end and was positioned to benefit from
further interest rate increases anticipated by the
market.
Deposit fees increased 5% quarter-over-quarter and 9%
year-over-year, reflecting increased customer activity. Most
lending related fees were down due to lower commercial activity in
the most recent quarter.
Provision for Credit Losses on Loans: Berkshire recorded a $3
million provision for credit losses in the third quarter of
2022, compared to a zero provision in the second quarter of 2022
and a credit of $4 million in the
third quarter of 2021. The Company continues to maintain strong
credit quality, and the allowance for credit losses on loans
decreased by $3 million to
$96 million during the
quarter.
Non-Interest Expense: Berkshire has maintained quarterly operating
non-interest expenses generally stable within a targeted range of
$68-70 million for more than a year,
with a goal of reinvesting expense savings into frontline bankers
and technology. Total expense increased to $82 million in the most recent quarter, primarily
due to the $11 million charge for
restructuring and other expense. The non-GAAP measure of
adjusted non-interest expense totaled $70
million during this quarter. Total compensation
expense increased by $2 million
quarter-over-quarter including wage increases and increased
performance based compensation. Full time equivalent staff totaled
1,300 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.
BALANCE SHEET (references are to period-end balances
unless otherwise stated)
Summary: Total loans grew by 2% quarter over
quarter and by 16% year-over-year, including increases near double
digits or greater across all major categories. Total deposits
decreased by 1% quarter-over-quarter and 4% year-over-year, due
primarily due to reductions of brokered deposits and overnight
payroll deposits. Period-end liquidity and capital remained
strong, with the ratio of loans/deposits measuring 80% and tangible
common equity/tangible assets measuring 8.1%. The Company remained
positively sensitive to interest rate increases based on its
asset/liability profile at period-end.
Loans: Quarter-over-quarter loan growth was
concentrated in a 12% increase in residential mortgages.
Year-over-year loan growth was concentrated in a 41% increase in
residential mortgages and a 10% increase in commercial loans.
Berkshire has expanded its
mortgage origination team and its in-footprint relationship bank
channel. The Company expanded its commercial teams over the
last year, and business volumes and credit usage have benefited
from improved market demand. Loan growth has also benefited
from a decline in prepayments in the prevailing rising rate
environment.
Asset Quality: Asset quality metrics remained
within historically favorable ranges through the third quarter.
Period-end non-performing assets measured 0.35% of total assets,
and total delinquent and non-accruing loans were 0.74% of total
loans. Annualized net loan charge-offs measured 0.16% of
average loans for the first nine months of the year. The ratio of
the allowance for loan credit losses on loans to total loans
decreased to 1.21% from 1.27% at midyear and from 1.55% at the
start of the year.
Deposits and Borrowings: Total deposits decreased
by 1% quarter-over-quarter and 4% year-over-year. Excluding
changes in overnight payroll deposits and changes in brokered
deposits, total deposits increased by 1% and decreased by 1% for
these respective periods. During the third quarter,
Berkshire prepaid its ten-year-old
6.875% $75 million subordinated
note. The Company completed the issuance of an investment
grade rated $100 million sustainable
subordinated bond offering in June
2022.
Equity: The $71
million, or 7%, quarter-over-quarter decrease in
shareholders' equity included a $61
million net decrease due to after-tax unrealized bond losses
caused by rising interest rates. Stock buybacks in the most recent
quarter totaled approximately $20
million consisting of approximately 705,000 shares. At
period-end, book value per share totaled $20.93 and tangible book value per share totaled
$20.36.
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:
- BEST Community Comeback: As a result of the collective
efforts of its employees, Berkshire is making steady progress towards
the achievement of its "BEST Community Comeback" goals. The
multi-year plan focuses on four key areas: fueling small
businesses, community financing and philanthropy, financial access
and empowerment, and funding environmental sustainability.
Additional information can be found at
berkshirebank.com/comeback.
- Current ESG Performance: The Company remained within its
BEST ESG goal with a top 23% composite performance in leading ESG
indexes in the U.S. for its Environmental, Social and Governance
(ESG) ratings. As of September 30,
2022 the Company has ratings of: MSCI ESG- BBB; ISS ESG
Quality Score - Environment: 2, Social: 1, Governance: 2; and
Bloomberg ESG Disclosure- 62.81. The Company also receives a rating
by Sustainalytics. Berkshire
continues to rank among the top 1% of all U.S. Banks for ESG in
Bloomberg this year.
- Recognition & Continued Community Impact: The Boston
Business Journal named Berkshire
one of Massachusetts' Top
Charitable Contributors for the tenth consecutive year. The honor
further demonstrates Berkshire's
deep commitment to lifting-up its communities which includes recent
announcements of $100,000 in
scholarships to forty (40) students continuing in their pursuit of
an undergraduate degree from an accredited non-profit college or
technical school and more than $600,000 in third quarter philanthropic
contributions through Berkshire's
Foundation to support projects enhancing the quality of life and
economic vibrancy in communities where the bank operates.
INVESTOR CONFERENCE CALL AND INVESTOR PRESENTATION
Berkshire will conduct a
conference call/webcast at 10:00 a.m.
Eastern time on Thursday, October 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://www.netroadshow.com/events/login?show=4f8bbd69&confId=42577
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: 197166. 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: 027908. 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 $11.3 billion in assets and operates 100
financial centers 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,"
"remain," "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
restructuring expense adjustment in third quarter of 2022 primarily
related to the termination of leasehold interests and the
write-down of related right of use assets and leasehold
improvements in conjunction with branch consolidations and real
estate reductions.
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)
|
|
|
|
|
|
|
|
|
|
Sept. 30,
|
|
Dec. 31,
|
|
March 31,
|
|
June 30,
|
|
Sept. 30,
|
|
|
|
|
|
2021
|
|
2021
|
|
2022
|
|
2022
|
|
2022
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NOMINAL AND PER SHARE DATA
|
|
|
|
|
|
|
|
|
|
|
|
|
Net earnings per common
share, diluted
|
$ 1.31
|
|
$ 0.42
|
|
$ 0.42
|
|
$ 0.50
|
|
$
0.42
|
|
|
|
Adjusted earnings per
common share, diluted (2)
|
0.53
|
|
0.42
|
|
0.43
|
|
0.51
|
|
0.62
|
|
|
|
Net income,
(thousands)
|
63,749
|
|
20,248
|
|
20,196
|
|
23,115
|
|
18,717
|
|
|
|
Adjusted net income,
(thousands) (2)
|
25,695
|
|
20,172
|
|
20,789
|
|
23,562
|
|
27,928
|
|
|
|
Total common shares
outstanding, end of period (thousands)
|
48,657
|
|
48,667
|
|
47,792
|
|
45,788
|
|
45,040
|
|
|
|
Average diluted shares,
(thousands)
|
48,744
|
|
48,340
|
|
48,067
|
|
46,102
|
|
45,034
|
|
|
|
Total book value per
common share, (end of period)
|
24.21
|
|
24.30
|
|
22.89
|
|
22.15
|
|
20.93
|
|
|
|
Tangible book value per
common share, (end of period) (2)
|
23.58
|
|
23.69
|
|
22.30
|
|
21.56
|
|
20.36
|
|
|
|
Dividends per common
share
|
0.12
|
|
0.12
|
|
0.12
|
|
0.12
|
|
0.12
|
|
|
|
Full-time equivalent
staff
|
1,333
|
|
1,319
|
|
1,333
|
|
1,322
|
|
1,300
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
PERFORMANCE RATIOS (3)
|
|
|
|
|
|
|
|
|
|
|
|
|
Return on
equity
|
22.18
|
%
|
6.86
|
%
|
6.79
|
%
|
7.82
|
%
|
6.30
|
%
|
|
|
Adjusted return on
equity (2)
|
8.94
|
|
6.83
|
|
6.99
|
|
7.97
|
|
9.40
|
|
|
|
Return on tangible
common equity (2)
|
23.14
|
|
7.37
|
|
7.29
|
|
8.33
|
|
6.76
|
|
|
|
Adjusted return on
tangible common equity (2)
|
9.53
|
|
7.34
|
|
7.49
|
|
8.48
|
|
9.92
|
|
|
|
Return on
assets
|
2.14
|
|
0.71
|
|
0.70
|
|
0.82
|
|
0.66
|
|
|
|
Adjusted return on
assets (2)
|
0.86
|
|
0.71
|
|
0.72
|
|
0.84
|
|
0.99
|
|
|
|
Net interest margin,
fully taxable equivalent (FTE) (4)(5)
|
2.56
|
|
2.60
|
|
2.61
|
|
3.11
|
|
3.48
|
|
|
|
Efficiency ratio
(2)
|
68.76
|
|
71.98
|
|
72.61
|
|
66.60
|
|
62.01
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FINANCIAL DATA (in millions, end of
period)
|
|
|
|
|
|
|
|
|
|
|
|
|
Total assets
|
|
$ 11,846
|
|
$ 11,555
|
|
$
12,097
|
|
$ 11,579
|
|
$
11,317
|
|
|
|
Total earning
assets
|
11,145
|
|
10,899
|
|
11,401
|
|
10,849
|
|
10,604
|
|
|
|
Total loans
|
|
6,836
|
|
6,826
|
|
7,267
|
|
7,803
|
|
7,943
|
|
|
|
Total
deposits
|
|
10,365
|
|
10,069
|
|
10,699
|
|
10,115
|
|
9,988
|
|
|
|
Loans/deposits
(%)
|
66
|
%
|
68
|
%
|
68
|
%
|
77
|
%
|
80
|
%
|
|
|
Total shareholders'
equity
|
$
1,178
|
|
$
1,182
|
|
$ 1,094
|
|
$
1,014
|
|
$
943
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ASSET QUALITY
|
|
|
|
|
|
|
|
|
|
|
|
|
Allowance for credit
losses, (millions)
|
$ 113
|
|
$ 106
|
|
$
99
|
|
$
99
|
|
$
96
|
|
|
|
Net charge-offs,
(millions)
|
(2)
|
|
(4)
|
|
(3)
|
|
(0)
|
|
(6)
|
|
|
|
Net charge-offs (QTD
annualized)/average loans
|
0.12
|
%
|
0.23
|
%
|
0.15
|
%
|
0.02
|
%
|
0.30
|
%
|
|
|
Provision
(benefit)/expense, (millions)
|
$
(4)
|
|
$
(3)
|
|
$
(4)
|
|
$
-
|
|
$
3
|
|
|
|
Non-performing assets,
(millions)
|
39
|
|
37
|
|
32
|
|
29
|
|
40
|
|
|
|
Non-performing
loans/total loans
|
0.54
|
%
|
0.52
|
%
|
0.41
|
%
|
0.34
|
%
|
0.48
|
%
|
|
|
Allowance for credit
losses/non-performing loans
|
304
|
|
300
|
|
335
|
|
368
|
|
254
|
|
|
|
Allowance for credit
losses/total loans
|
1.65
|
|
1.55
|
|
1.37
|
|
1.27
|
|
1.21
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CAPITAL RATIOS
|
|
|
|
|
|
|
|
|
|
|
|
|
Common equity tier 1
capital to risk weighted assets(6)
|
15.3
|
%
|
15.0
|
%
|
13.9
|
%
|
12.9
|
%
|
12.7
|
%
|
|
|
Tier 1 capital leverage
ratio(6)
|
9.9
|
|
10.5
|
|
10.3
|
|
10.2
|
|
10.1
|
|
|
|
Tangible common
shareholders' equity/tangible assets(2)
|
9.7
|
|
10.0
|
|
8.8
|
|
8.5
|
|
8.1
|
|
|
|
(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: 0.06%, 0.06%,
0.03%, 0.03%, 0.01%
|
(6)
|
Presented as projected
for September 30, 2022 and actual for the remaining
periods.
|
BERKSHIRE HILLS BANCORP, INC.
|
CONSOLIDATED BALANCE SHEETS - UNAUDITED -
(F-2)
|
|
September
30,
|
December
31,
|
June 30,
|
September 30,
|
(in thousands)
|
2021
|
2021
|
2022
|
2022
|
Assets
|
|
|
|
|
Cash and due from
banks
|
$
153,185
|
$
109,350
|
$ 156,470
|
$
128,509
|
Short-term
investments
|
1,971,345
|
1,518,457
|
714,547
|
566,404
|
Total cash and cash
equivalents
|
2,124,530
|
1,627,807
|
871,017
|
694,913
|
|
|
|
|
|
Trading
security
|
8,574
|
8,354
|
7,040
|
6,812
|
Marketable equity
securities, at fair value
|
15,601
|
15,453
|
14,154
|
12,790
|
Securities available
for sale, at fair value
|
1,643,965
|
1,877,585
|
1,697,019
|
1,470,949
|
Securities held to
maturity, at amortized cost
|
651,863
|
636,503
|
602,611
|
592,503
|
Federal Home Loan Bank
stock and other restricted securities
|
12,041
|
10,800
|
9,365
|
7,264
|
Total
securities
|
2,332,044
|
2,548,695
|
2,330,189
|
2,090,318
|
Less: Allowance for
credit losses on investment securities
|
(125)
|
(105)
|
(94)
|
(95)
|
Net
securities
|
2,331,919
|
2,548,590
|
2,330,095
|
2,090,223
|
|
|
|
|
|
Loans held for
sale
|
5,176
|
6,110
|
1,062
|
4,124
|
|
|
|
|
|
Total loans
|
6,836,235
|
6,825,847
|
7,803,451
|
7,943,481
|
Less: Allowance for
credit losses on loans
|
(112,916)
|
(106,094)
|
(99,021)
|
(96,013)
|
Net loans
|
6,723,319
|
6,719,753
|
7,704,430
|
7,847,468
|
|
|
|
|
|
Premises and equipment,
net
|
99,233
|
94,383
|
89,657
|
86,809
|
Goodwill and other
intangible assets
|
30,907
|
29,619
|
27,046
|
25,761
|
Other assets
|
527,049
|
524,074
|
550,275
|
563,946
|
Assets held for
sale
|
3,743
|
4,577
|
5,386
|
3,830
|
Total assets
|
$
11,845,876
|
$
11,554,913
|
$ 11,578,968
|
$
11,317,074
|
|
|
|
|
|
Liabilities and shareholders'
equity
|
|
|
|
|
Demand
deposits
|
$
3,022,821
|
$
3,008,461
|
$
2,921,347
|
$ 2,896,659
|
NOW and other
deposits
|
1,982,089
|
976,401
|
2,247,544
|
1,045,970
|
Money market
deposits
|
2,438,832
|
3,293,526
|
2,327,004
|
3,388,932
|
Savings
deposits
|
1,095,959
|
1,111,625
|
1,143,352
|
1,111,304
|
Time
deposits
|
1,825,714
|
1,678,940
|
1,475,417
|
1,545,256
|
Total
deposits
|
10,365,415
|
10,068,953
|
10,114,664
|
9,988,121
|
|
|
|
|
|
Senior
borrowings
|
13,369
|
13,331
|
58,542
|
4,494
|
Subordinated
borrowings
|
97,454
|
97,513
|
195,659
|
121,001
|
Total
borrowings
|
110,823
|
110,844
|
254,201
|
125,495
|
|
|
|
|
|
Other
liabilities
|
191,563
|
192,681
|
196,053
|
260,896
|
Total
liabilities
|
10,667,801
|
10,372,478
|
10,564,918
|
10,374,512
|
|
|
|
|
|
Common shareholders'
equity
|
1,178,075
|
1,182,435
|
1,014,050
|
942,562
|
Total shareholders'
equity
|
1,178,075
|
1,182,435
|
1,014,050
|
942,562
|
Total liabilities and
shareholders' equity
|
$
11,845,876
|
$
11,554,913
|
$ 11,578,968
|
$
11,317,074
|
BERKSHIRE HILLS BANCORP, INC.
|
CONSOLIDATED LOAN & DEPOSIT ANALYSIS - UNAUDITED
- (F-3)
|
LOAN ANALYSIS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Growth %
|
(in millions)
|
|
December 31, 2021
Balance
|
|
June 30, 2022
Balance
|
|
September 30,
2022
Balance
|
|
Quarter ended
September 30, 2022
|
|
Year to
Date
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total commercial real
estate
|
|
$
3,598
|
|
$
3,920
|
|
$
3,902
|
|
(0)
|
%
|
8
|
%
|
Commercial and
industrial loans
|
|
1,330
|
|
1,471
|
|
1,435
|
|
(2)
|
|
8
|
|
Total commercial
loans
|
|
4,928
|
|
5,391
|
|
5,337
|
|
(1)
|
|
8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total residential
mortgages
|
|
1,392
|
|
1,819
|
|
2,033
|
|
12
|
|
46
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Home equity
|
|
253
|
|
241
|
|
234
|
|
(3)
|
|
(7)
|
|
Auto and
other
|
|
253
|
|
352
|
|
339
|
|
(4)
|
|
34
|
|
Total consumer
loans
|
|
506
|
|
593
|
|
573
|
|
(3)
|
|
13
|
|
Total loans
|
|
$
6,826
|
|
$
7,803
|
|
$
7,943
|
|
2
|
%
|
16
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
DEPOSIT ANALYSIS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Growth %
|
(in millions)
|
|
December 31, 2021
Balance
|
|
June 30, 2022
Balance
|
|
September 30,
2022
Balance
|
|
Quarter ended
September 30, 2022
|
|
Year to
Date
|
|
Non-interest
bearing
|
|
$
3,008
|
|
$
2,921
|
|
$
2,897
|
|
(1)
|
%
|
(4)
|
%
|
NOW and
other
|
|
976
|
|
2,248
|
|
1,046
|
|
(53)
|
|
7
|
|
Money market
|
|
3,294
|
|
2,327
|
|
3,389
|
|
46
|
|
3
|
|
Savings
|
|
1,112
|
|
1,143
|
|
1,111
|
|
(3)
|
|
(0)
|
|
Time
deposits
|
|
1,679
|
|
1,476
|
|
1,545
|
|
5
|
|
(8)
|
|
Total deposits
(1)
|
|
$
10,069
|
|
$
10,115
|
|
$
9,988
|
|
(1)
|
%
|
(1)
|
%
|
(1) Included in total
deposits are brokered deposits of $163.6 million, $112.9 million,
and $228.1 million at September 30, 2022, June 30, 2022, and
December 31, 2021, respectively.
|
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)
|
2022
|
|
2021
|
|
2022
|
|
2021
|
Interest
income
|
$ 103,671
|
|
$
79,688
|
|
$ 265,873
|
|
$ 253,205
|
Interest
expense
|
11,587
|
|
8,320
|
|
23,368
|
|
31,351
|
Net interest income,
not FTE
|
92,084
|
|
71,368
|
|
242,505
|
|
221,854
|
Non-interest income
|
|
|
|
|
|
|
|
Deposit related
fees
|
8,377
|
|
7,657
|
|
23,733
|
|
22,291
|
Loan fees and
revenue
|
3,785
|
|
8,285
|
|
16,673
|
|
25,962
|
Insurance commissions
and fees
|
-
|
|
1,581
|
|
-
|
|
7,003
|
Wealth management
fees
|
2,353
|
|
2,653
|
|
7,753
|
|
7,944
|
Mortgage banking
fees
|
58
|
|
461
|
|
186
|
|
1,797
|
Other
|
2,154
|
|
1,279
|
|
7,132
|
|
5,638
|
Total non-interest
income excluding (losses)
|
16,727
|
|
21,916
|
|
55,477
|
|
70,635
|
Securities (losses),
net
|
(476)
|
|
(166)
|
|
(2,194)
|
|
(681)
|
Gain on sale of
business operations and assets, net
|
-
|
|
51,885
|
|
-
|
|
51,885
|
Total non-interest
income
|
16,251
|
|
73,635
|
|
53,283
|
|
121,839
|
Total net revenue
|
108,335
|
|
145,003
|
|
295,788
|
|
343,693
|
Total net revenue
excluding (losses)
|
108,811
|
|
93,284
|
|
297,982
|
|
292,489
|
|
|
|
|
|
|
|
|
Provision
expense/(benefit) for credit losses
|
3,000
|
|
(4,000)
|
|
(1,000)
|
|
2,500
|
Non-interest expense
|
|
|
|
|
|
|
|
Compensation and
benefits
|
39,422
|
|
37,068
|
|
114,773
|
|
112,773
|
Occupancy and
equipment
|
8,702
|
|
10,421
|
|
28,207
|
|
32,044
|
Technology and
communications
|
8,719
|
|
8,397
|
|
25,857
|
|
25,204
|
Professional
services
|
3,285
|
|
3,180
|
|
8,890
|
|
13,495
|
Other
expenses
|
10,076
|
|
8,969
|
|
29,449
|
|
28,053
|
Merger, restructuring
and other non-operating expenses
|
11,473
|
|
1,425
|
|
11,526
|
|
4,917
|
Total non-interest
expense
|
81,677
|
|
69,460
|
|
218,702
|
|
216,486
|
Total non-interest
expense excluding merger, restructuring and other
|
70,204
|
|
68,035
|
|
207,176
|
|
211,569
|
|
|
|
|
|
|
|
|
Income before income
taxes
|
$
23,658
|
|
$
79,543
|
|
$
78,086
|
|
$ 124,707
|
Income tax
expense
|
4,941
|
|
15,794
|
|
16,058
|
|
26,291
|
Net income
|
$
18,717
|
|
$
63,749
|
|
$
62,028
|
|
$
98,416
|
|
|
|
|
|
|
|
|
Basic earnings per common share
|
$ 0.42
|
|
$ 1.32
|
|
$ 1.35
|
|
$ 1.98
|
Diluted earnings per common
share
|
$
0.42
|
|
$
1.31
|
|
$
1.34
|
|
$
1.97
|
|
|
|
|
|
|
|
|
Weighted average shares
outstanding:
|
|
|
|
|
|
|
|
Basic
|
44,700
|
|
48,395
|
|
46,056
|
|
49,672
|
Diluted
|
45,034
|
|
48,744
|
|
46,396
|
|
49,963
|
|
|
|
|
|
|
|
|
BERKSHIRE HILLS BANCORP, INC.
|
CONSOLIDATED STATEMENTS OF INCOME (5 Quarter Trend) -
UNAUDITED - (F-5)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sept. 30,
|
|
Dec. 31,
|
|
March 31,
|
|
June 30,
|
|
Sept. 30,
|
|
(in thousands, except per share
data)
|
|
2021
|
|
2021
|
|
2022
|
|
2022
|
|
2022
|
|
Interest
income
|
|
$
79,688
|
|
$
75,860
|
|
$
74,823
|
|
$
87,379
|
|
$ 103,671
|
|
Interest
expense
|
|
8,320
|
|
6,548
|
|
5,760
|
|
6,021
|
|
11,587
|
|
Net interest income,
not FTE
|
|
71,368
|
|
69,312
|
|
69,063
|
|
81,358
|
|
92,084
|
|
Non-interest
income
|
|
|
|
|
|
|
|
|
|
|
|
Deposit related
fees
|
|
7,657
|
|
7,522
|
|
7,351
|
|
8,005
|
|
8,377
|
|
Loan fees and
revenue
|
|
8,285
|
|
9,098
|
|
8,265
|
|
4,623
|
|
3,785
|
|
Insurance commissions
and fees
|
|
1,581
|
|
-
|
|
-
|
|
-
|
|
-
|
|
Wealth management
fees
|
|
2,653
|
|
2,586
|
|
2,625
|
|
2,775
|
|
2,353
|
|
Mortgage banking
fees
|
|
461
|
|
259
|
|
19
|
|
109
|
|
58
|
|
Other
|
|
1,279
|
|
993
|
|
3,166
|
|
1,812
|
|
2,154
|
|
Total non-interest
income excluding (losses)/gains
|
|
21,916
|
|
20,458
|
|
21,426
|
|
17,324
|
|
16,727
|
|
Securities (losses),
net
|
|
(166)
|
|
(106)
|
|
(745)
|
|
(973)
|
|
(476)
|
|
Gain on sale of
business operations and assets, net
|
|
51,885
|
|
1,057
|
|
-
|
|
-
|
|
-
|
|
Total non-interest
income
|
|
73,635
|
|
21,409
|
|
20,681
|
|
16,351
|
|
16,251
|
|
Total net revenue
|
|
145,003
|
|
90,721
|
|
89,744
|
|
97,709
|
|
108,335
|
|
Total net revenue
excluding (losses)/gains
|
|
93,284
|
|
89,770
|
|
90,489
|
|
98,682
|
|
108,811
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision
(benefit)/expense for credit losses
|
|
(4,000)
|
|
(3,000)
|
|
(4,000)
|
|
-
|
|
3,000
|
|
Non-interest expense
|
|
|
|
|
|
|
|
|
|
|
|
Compensation and
benefits
|
|
37,068
|
|
37,816
|
|
37,521
|
|
37,830
|
|
39,422
|
|
Occupancy and
equipment
|
|
10,421
|
|
9,738
|
|
10,067
|
|
9,438
|
|
8,702
|
|
Technology and
communications
|
|
8,397
|
|
8,599
|
|
8,527
|
|
8,611
|
|
8,719
|
|
Professional
services
|
|
3,180
|
|
2,365
|
|
2,692
|
|
2,913
|
|
3,285
|
|
Other
expenses
|
|
8,969
|
|
10,025
|
|
9,725
|
|
9,648
|
|
10,076
|
|
Merger, restructuring
and other non-operating expenses
|
|
1,425
|
|
864
|
|
18
|
|
35
|
|
11,473
|
|
Total non-interest
expense
|
|
69,460
|
|
69,407
|
|
68,550
|
|
68,475
|
|
81,677
|
|
Total non-interest
expense excluding merger, restructuring and other
|
|
68,035
|
|
68,543
|
|
68,532
|
|
68,440
|
|
70,204
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before income
taxes
|
|
$
79,543
|
|
$
24,314
|
|
$
25,194
|
|
$
29,234
|
|
$
23,658
|
|
Income tax
expense
|
|
15,794
|
|
4,066
|
|
4,998
|
|
6,119
|
|
4,941
|
|
Net income
|
|
$
63,749
|
|
$
20,248
|
|
$
20,196
|
|
$
23,115
|
|
$
18,717
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings per
common share
|
|
$
1.31
|
|
$
0.42
|
|
$
0.42
|
|
$
0.50
|
|
$
0.42
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average shares
outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
48,395
|
|
47,958
|
|
47,668
|
|
45,818
|
|
44,700
|
|
Diluted
|
|
48,744
|
|
48,340
|
|
48,067
|
|
46,102
|
|
45,034
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BERKSHIRE HILLS BANCORP, INC.
|
AVERAGE BALANCES AND AVERAGE YIELDS AND COSTS -
UNAUDITED - (F-6)
|
|
|
|
Sept. 30,
2021
|
|
Dec. 31,
2021
|
|
March 31,
2022
|
|
June 30,
2022
|
|
Sept. 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
|
3,577
|
3.40
|
%
|
3,569
|
3.49
|
%
|
3,651
|
3.35
|
%
|
3,831
|
3.79
|
%
|
3,926
|
4.53
|
%
|
Commercial and
industrial loans
|
1,370
|
4.78
|
|
|
1,278
|
4.37
|
|
|
1,373
|
4.14
|
|
|
1,447
|
4.46
|
|
|
1,449
|
5.21
|
|
|
Residential
mortgages
|
1,499
|
3.65
|
|
|
1,403
|
3.82
|
|
|
1,436
|
3.56
|
|
|
1,652
|
3.57
|
|
|
1,926
|
3.53
|
|
|
Consumer
loans
|
545
|
3.95
|
|
|
516
|
3.96
|
|
|
514
|
4.24
|
|
|
562
|
5.41
|
|
|
587
|
6.24
|
|
|
Total loans (1)
|
6,991
|
3.77
|
|
|
6,766
|
3.76
|
|
|
6,974
|
3.61
|
|
|
7,492
|
3.99
|
|
|
7,888
|
4.54
|
|
|
Securities
(2)
|
2,312
|
2.09
|
|
|
2,367
|
2.04
|
|
|
2,649
|
1.95
|
|
|
2,621
|
1.97
|
|
|
2,400
|
2.13
|
|
|
Short-term investments
and loans held for sale
|
1,762
|
0.17
|
|
|
1,609
|
0.17
|
|
|
1,202
|
0.17
|
|
|
476
|
0.57
|
|
|
342
|
1.96
|
|
|
Mid-Atlantic region
loans held for sale
|
155
|
3.82
|
|
|
-
|
-
|
|
|
-
|
-
|
|
|
-
|
-
|
|
|
-
|
-
|
|
|
Total earning assets
|
11,220
|
2.86
|
|
|
10,742
|
2.84
|
|
|
10,825
|
2.82
|
|
|
10,589
|
3.34
|
|
|
10,630
|
3.91
|
|
|
Goodwill and other
intangible assets
|
31
|
|
|
|
30
|
|
|
|
29
|
|
|
|
27
|
|
|
|
26
|
|
|
|
Other assets
|
674
|
|
|
|
655
|
|
|
|
639
|
|
|
|
644
|
|
|
|
659
|
|
|
|
Total assets
|
11,925
|
|
|
|
11,427
|
|
|
|
11,493
|
|
|
|
11,260
|
|
|
|
11,315
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities and shareholders'
equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NOW and
other
|
1,316
|
0.05
|
%
|
1,331
|
0.05
|
%
|
1,456
|
0.04
|
%
|
1,454
|
0.12
|
%
|
1,362
|
0.48
|
%
|
Money market
|
2,716
|
0.16
|
|
|
2,731
|
0.16
|
|
|
2,871
|
0.16
|
|
|
2,811
|
0.19
|
|
|
2,737
|
0.46
|
|
|
Savings
|
1,112
|
0.04
|
|
|
1,100
|
0.04
|
|
|
1,117
|
0.03
|
|
|
1,127
|
0.03
|
|
|
1,129
|
0.03
|
|
|
Time
|
1,893
|
0.86
|
|
|
1,750
|
0.80
|
|
|
1,624
|
0.71
|
|
|
1,460
|
0.64
|
|
|
1,528
|
0.85
|
|
|
Total interest-bearing deposits
|
7,037
|
0.31
|
|
|
6,912
|
0.28
|
|
|
7,068
|
0.24
|
|
|
6,852
|
0.24
|
|
|
6,756
|
0.48
|
|
|
Borrowings
(3)
|
263
|
3.89
|
|
|
121
|
5.68
|
|
|
122
|
5.21
|
|
|
160
|
4.61
|
|
|
251
|
5.46
|
|
|
Mid-Atlantic region
interest-bearing deposits
|
306
|
0.51
|
|
|
-
|
-
|
|
|
-
|
-
|
|
|
-
|
-
|
|
|
-
|
-
|
|
|
Total interest-bearing
liabilities
|
7,606
|
0.43
|
|
|
7,033
|
0.37
|
|
|
7,190
|
0.32
|
|
|
7,012
|
0.34
|
|
|
7,007
|
0.66
|
|
|
Non-interest-bearing
demand deposits
|
2,901
|
|
|
|
3,038
|
|
|
|
2,968
|
|
|
|
2,903
|
|
|
|
2,913
|
|
|
|
Other
liabilities (4)
|
269
|
|
|
|
175
|
|
|
|
146
|
|
|
|
163
|
|
|
|
206
|
|
|
|
Total
liabilities
|
10,776
|
|
|
|
10,246
|
|
|
|
10,304
|
|
|
|
10,078
|
|
|
|
10,126
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common shareholders'
equity
|
1,149
|
|
|
|
1,181
|
|
|
|
1,189
|
|
|
|
1,182
|
|
|
|
1,189
|
|
|
|
Total shareholders'
equity
|
1,149
|
|
|
|
1,181
|
|
|
|
1,189
|
|
|
|
1,182
|
|
|
|
1,189
|
|
|
|
Total liabilities and
shareholders' equity
|
11,925
|
|
|
|
11,427
|
|
|
|
11,493
|
|
|
|
11,260
|
|
|
|
11,315
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest
spread
|
|
2.43
|
%
|
|
2.47
|
%
|
|
2.50
|
%
|
|
2.99
|
%
|
|
3.25
|
%
|
Net interest margin,
FTE (5)
|
|
2.56
|
|
|
|
2.60
|
|
|
|
2.61
|
|
|
|
3.11
|
|
|
|
3.48
|
|
|
Cost of
funds
|
|
0.31
|
|
|
|
0.26
|
|
|
|
0.23
|
|
|
|
0.24
|
|
|
|
0.46
|
|
|
Cost of
deposits
|
|
0.22
|
|
|
|
0.19
|
|
|
|
0.17
|
|
|
|
0.17
|
|
|
|
0.33
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Supplementary data
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Interest Income,
not FTE
|
71.368
|
|
|
|
69.312
|
|
|
|
69.063
|
|
|
|
81.358
|
|
|
|
92.084
|
|
|
|
Fully taxable
equivalent income adjustment
|
1.586
|
|
|
|
1.604
|
|
|
|
1.524
|
|
|
|
1.560
|
|
|
|
1.715
|
|
|
|
Net Interest Income, FTE
|
72.954
|
|
|
|
70.916
|
|
|
|
70.587
|
|
|
|
82.918
|
|
|
|
93.799
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average PPP
loans (6)
|
90
|
|
|
|
37
|
|
|
|
27
|
|
|
|
NM
|
|
|
|
NM
|
|
|
|
Average loans excluding
PPP loans (6)
|
6,901
|
|
|
|
6,729
|
|
|
|
6,947
|
|
|
|
7,492
|
|
|
|
7,888
|
|
|
|
Total PPP loans, end
of period (6)
|
46
|
|
|
|
30
|
|
|
|
16
|
|
|
|
NM
|
|
|
|
NM
|
|
|
|
Total loans excluding
PPP loans, end of period (6)
|
6,790
|
|
|
|
6,796
|
|
|
|
7,251
|
|
|
|
7,803
|
|
|
|
7,943
|
|
|
|
PPP interest
income
|
2.063
|
|
|
|
0.302
|
|
|
|
0.200
|
|
|
|
NM
|
|
|
|
NM
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total average
non-maturity deposits
|
8,045
|
|
|
|
8,200
|
|
|
|
8,412
|
|
|
|
8,295
|
|
|
|
8,141
|
|
|
|
Total average
deposits
|
9,938
|
|
|
|
9,950
|
|
|
|
10,037
|
|
|
|
9,755
|
|
|
|
9,669
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Purchase accounting
accretion
|
1.695
|
|
|
|
1.548
|
|
|
|
0.717
|
|
|
|
0.773
|
|
|
|
0.280
|
|
|
|
Total average tangible
equity (7)
|
1,118
|
|
|
|
1,151
|
|
|
|
1,160
|
|
|
|
1,155
|
|
|
|
1,163
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(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) The average balance
for September 30, 2021 includes the Mid-Atlantic region
non-interesting 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:
(0.05%, 0.00%, 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)
|
|
|
|
Sept. 30,
|
|
Dec. 31,
|
|
March 31,
|
|
June 30,
|
|
Sept. 30,
|
|
(in thousands)
|
2021
|
|
2021
|
|
2022
|
|
2022
|
|
2022
|
|
NON-PERFORMING ASSETS
|
|
|
|
|
|
|
|
|
|
|
Non-accruing
loans:
|
|
|
|
|
|
|
|
|
|
|
Commercial real
estate
|
$
14,845
|
|
$
13,954
|
|
$ 8,984
|
|
$
8,277
|
|
$
2,976
|
|
Commercial and
industrial loans
|
7,140
|
|
6,747
|
|
5,618
|
|
4,891
|
|
21,008
|
|
Residential
mortgages
|
9,763
|
|
9,825
|
|
11,079
|
|
10,331
|
|
10,407
|
|
Consumer
loans
|
5,399
|
|
4,800
|
|
4,000
|
|
3,385
|
|
3,463
|
|
Total non-accruing
loans
|
37,147
|
|
35,326
|
|
29,681
|
|
26,884
|
|
37,854
|
|
Other real estate
owned
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
Repossessed
assets
|
1,664
|
|
1,736
|
|
2,004
|
|
2,004
|
|
2,175
|
|
Total non-performing
assets
|
$
38,811
|
|
$
37,062
|
|
$
31,685
|
|
$ 28,888
|
|
$ 40,029
|
|
|
|
|
|
|
|
|
|
|
|
|
Total non-accruing
loans/total loans
|
0.54 %
|
|
0.52 %
|
|
0.41 %
|
|
0.34 %
|
|
0.48 %
|
|
Total non-accruing
loans/total loans excluding PPP loans
|
0.55 %
|
|
0.52 %
|
|
0.42 %
|
|
0.38 %
|
|
0.54 %
|
|
Total non-performing
assets/total assets
|
0.33 %
|
|
0.32 %
|
|
0.26 %
|
|
0.25 %
|
|
0.35 %
|
|
|
|
|
|
|
|
|
|
|
|
|
PROVISION AND ALLOWANCE FOR CREDIT LOSSES ON
LOANS
|
|
|
|
|
|
|
|
Balance at beginning of
period
|
$ 119,044
|
|
$ 112,916
|
|
$ 106,094
|
|
$ 99,475
|
|
$ 99,021
|
|
Charged-off
loans
|
(4,334)
|
|
(7,976)
|
|
(6,048)
|
|
(1,593)
|
|
(7,424)
|
|
Recoveries on
charged-off loans
|
2,206
|
|
4,154
|
|
3,429
|
|
1,139
|
|
1,416
|
|
Net loans
charged-off
|
(2,128)
|
|
(3,822)
|
|
(2,619)
|
|
(454)
|
|
(6,008)
|
|
Provision
(benefit)/expense for loan credit losses
|
(4,000)
|
|
(3,000)
|
|
(4,000)
|
|
-
|
|
3,000
|
|
Balance at end of
period
|
$ 112,916
|
|
$ 106,094
|
|
$
99,475
|
|
$ 99,021
|
|
$ 96,013
|
|
|
|
|
|
|
|
|
|
|
|
|
Allowance for credit
losses/total loans
|
1.65 %
|
|
1.55 %
|
|
1.37 %
|
|
1.27 %
|
|
1.21 %
|
|
Allowance for credit
losses/total loans excluding PPP loans
|
1.66 %
|
|
1.56 %
|
|
1.37 %
|
|
1.27 %
|
|
1.21 %
|
|
Allowance for credit
losses/non-accruing loans
|
304 %
|
|
300 %
|
|
335 %
|
|
368 %
|
|
254 %
|
|
|
|
|
|
|
|
|
|
|
|
|
NET LOAN CHARGE-OFFS
|
|
|
|
|
|
|
|
|
|
|
Commercial real
estate
|
$
(1,391)
|
|
$
(2,208)
|
|
$
(3,280)
|
|
$ (76)
|
|
$
(854)
|
|
Commercial and
industrial loans
|
110
|
|
(1,649)
|
|
653
|
|
(237)
|
|
(4,931)
|
|
Residential
mortgages
|
(677)
|
|
(2)
|
|
(50)
|
|
(30)
|
|
122
|
|
Home equity
|
106
|
|
106
|
|
135
|
|
33
|
|
1
|
|
Auto and other
consumer
|
(276)
|
|
(69)
|
|
(77)
|
|
(144)
|
|
(346)
|
|
Total, net
|
$
(2,128)
|
|
$
(3,822)
|
|
$
(2,619)
|
|
$
(454)
|
|
$ (6,008)
|
|
|
|
|
|
|
|
|
|
|
|
|
Net charge-offs (QTD
annualized)/average loans
|
0.12 %
|
|
0.23 %
|
|
0.15 %
|
|
0.02 %
|
|
0.30 %
|
|
Net charge-offs (YTD
annualized)/average loans
|
0.30 %
|
|
0.29 %
|
|
0.15 %
|
|
0.08 %
|
|
0.16 %
|
|
|
|
|
|
|
|
|
|
|
|
|
BERKSHIRE HILLS BANCORP, INC.
|
ASSET QUALITY ANALYSIS - UNAUDITED
(F-8)
|
|
|
|
September 30,
2021
|
December 31,
2021
|
|
March 31,
2022
|
|
June 30,
2022
|
|
September 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
|
$ 18,365
|
0.27 %
|
|
$ 39,863
|
|
0.58 %
|
|
$ 13,517
|
|
0.19 %
|
|
$ 36,184
|
|
0.46 %
|
|
$ 14,662
|
|
0.18 %
|
|
90+ Days delinquent and
still accruing
|
3,803
|
0.06 %
|
|
3,270
|
|
0.05 %
|
|
6,613
|
|
0.09 %
|
|
6,760
|
|
0.09 %
|
|
6,285
|
|
0.08 %
|
|
Total accruing
delinquent loans
|
22,168
|
0.33 %
|
|
43,133
|
|
0.63 %
|
|
20,130
|
|
0.28 %
|
|
42,944
|
|
0.55 %
|
|
20,947
|
|
0.26 %
|
|
Non-accruing
loans
|
37,147
|
0.54 %
|
|
35,326
|
|
0.52 %
|
|
29,681
|
|
0.41 %
|
|
26,884
|
|
0.34 %
|
|
37,854
|
|
0.48 %
|
|
Total delinquent and
non-accruing loans
|
$ 59,315
|
0.87 %
|
|
$ 78,459
|
|
1.15 %
|
|
$ 49,811
|
|
0.69 %
|
|
$ 69,828
|
|
0.89 %
|
|
$ 58,801
|
|
0.74 %
|
|
BERKSHIRE HILLS BANCORP, INC.
|
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES AND
SUPPLEMENTARY DATA- UNAUDITED - (F-9)
|
|
|
|
|
|
Sept. 30,
|
|
Dec. 31,
|
|
March 31,
|
|
June 30,
|
|
Sept. 30,
|
|
(in thousands)
|
|
2021
|
|
2021
|
|
2022
|
|
2022
|
|
2022
|
|
Total
revenue
|
(A)
|
$
145,003
|
|
$
90,721
|
|
$
89,744
|
|
$
97,709
|
|
$
108,335
|
|
Adj: Net securities
losses (1)
|
|
166
|
|
106
|
|
745
|
|
973
|
|
476
|
|
Adj: Net (gains) on
sale of business operations and assets
|
|
(51,885)
|
|
(1,057)
|
|
-
|
|
-
|
|
-
|
|
Total adjusted
revenue (2)
|
(B)
|
$ 93,284
|
|
$
89,770
|
|
$
90,489
|
|
$
98,682
|
|
$
108,811
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total non-interest
expense
|
(C)
|
$ 69,460
|
|
$
69,407
|
|
$
68,550
|
|
$
68,475
|
|
$ 81,677
|
|
Less: Merger,
restructuring and other expense
|
|
(1,425)
|
|
(864)
|
|
(18)
|
|
(35)
|
|
(11,473)
|
|
Adjusted non-interest
expense (2)
|
(D)
|
$ 68,035
|
|
$
68,543
|
|
$
68,532
|
|
$
68,440
|
|
$ 70,204
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pre-tax, pre-provision
net revenue (PPNR)
|
(A-C)
|
$ 75,543
|
|
$
21,314
|
|
$
21,194
|
|
$
29,234
|
|
$ 26,658
|
|
Adjusted pre-tax,
pre-provision net revenue (PPNR)
|
(B-D)
|
25,249
|
|
21,227
|
|
21,957
|
|
30,242
|
|
38,607
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
|
$ 63,749
|
|
$
20,248
|
|
$
20,196
|
|
$
23,115
|
|
$ 18,717
|
|
Adj: Net securities
losses (1)
|
|
166
|
|
106
|
|
745
|
|
973
|
|
476
|
|
Adj: Net (gains) on
sale of business operations and assets
|
|
(51,885)
|
|
(1,057)
|
|
-
|
|
-
|
|
-
|
|
Adj: Restructuring
expense and other expense
|
|
1,425
|
|
864
|
|
18
|
|
35
|
|
11,473
|
|
Adj: Income taxes
(expense)/benefit
|
|
12,240
|
|
11
|
|
(170)
|
|
(561)
|
|
(2,738)
|
|
Total adjusted
income (2)
|
(E)
|
$ 25,695
|
|
$
20,172
|
|
$
20,789
|
|
$
23,562
|
|
$ 27,928
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in millions, except per share
data)
|
|
|
|
|
|
|
|
|
|
|
|
Total average
assets
|
(F)
|
$ 11,925
|
|
$
11,427
|
|
$
11,493
|
|
$
11,260
|
|
$ 11,315
|
|
Total average
shareholders'
equity
|
(G)
|
1,149
|
|
1,181
|
|
1,189
|
|
1,182
|
|
1,189
|
|
Total average tangible
shareholders' equity (2)(3)
|
(H)
|
1,118
|
|
1,151
|
|
1,160
|
|
1,155
|
|
1,164
|
|
Total average tangible
common shareholders' equity (2)(3)
|
(I)
|
1,118
|
|
1,151
|
|
1,160
|
|
1,155
|
|
1,164
|
|
Total tangible
shareholders' equity, period-end (2)(3)
|
(J)
|
1,147
|
|
1,153
|
|
1,066
|
|
987
|
|
917
|
|
Total tangible common
shareholders' equity, period-end (2)(3)
|
(K)
|
1,147
|
|
1,153
|
|
1,066
|
|
987
|
|
917
|
|
Total tangible assets,
period-end (2)(3)
|
(L)
|
11,815
|
|
11,525
|
|
12,069
|
|
11,552
|
|
11,291
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total common shares
outstanding, period-end (thousands)
|
(M)
|
48,657
|
|
48,667
|
|
47,792
|
|
45,788
|
|
45,040
|
|
Average diluted shares
outstanding (thousands)
|
(N)
|
48,744
|
|
48,340
|
|
48,067
|
|
46,102
|
|
45,034
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP earnings per
common share, diluted (2)
|
|
$
1.31
|
|
$ 0.42
|
|
$ 0.42
|
|
$ 0.50
|
|
$
0.42
|
|
Adjusted earnings per
common share, diluted (2)
|
(E/N)
|
0.53
|
|
0.42
|
|
0.43
|
|
0.51
|
|
0.62
|
|
Tangible book value per
common share, period-end (2)
|
(K/M)
|
23.58
|
|
23.69
|
|
22.30
|
|
21.56
|
|
20.36
|
|
Total tangible
shareholders' equity/total tangible assets (2)
|
(J/L)
|
9.71
|
|
10.00
|
|
8.83
|
|
8.54
|
|
8.12
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Performance ratios (4)
|
|
|
|
|
|
|
|
|
|
|
|
GAAP return on
equity
|
|
22.18
|
%
|
6.86
|
%
|
6.79
|
|
7.82
|
%
|
6.30
|
%
|
Adjusted return on
equity (2)
|
(E/G)
|
8.94
|
|
6.83
|
|
6.99
|
|
7.97
|
|
9.40
|
|
Return on tangible
common equity (2)(5)
|
|
23.14
|
|
7.37
|
|
7.29
|
|
8.33
|
|
6.76
|
|
Adjusted return on
tangible common equity (2)(5)
|
(E+Q)/(I)
|
9.53
|
|
7.34
|
|
7.49
|
|
8.48
|
|
9.92
|
|
GAAP return on
assets
|
|
2.14
|
|
0.71
|
|
0.70
|
|
0.82
|
|
0.66
|
|
Adjusted return on
assets (2)
|
|
0.86
|
|
0.71
|
|
0.72
|
|
0.84
|
|
0.99
|
|
PPNR from continuing
operations/assets (2)
|
|
2.53
|
|
0.75
|
|
0.74
|
|
1.04
|
|
0.94
|
|
Adjusted
PPNR/assets (2)
|
|
0.85
|
|
0.74
|
|
0.76
|
|
1.07
|
|
1.36
|
|
Efficiency ratio
(2)(6)
|
(D-Q)/(B+O+R)
|
68.76
|
|
71.98
|
|
72.61
|
|
66.60
|
|
62.01
|
|
Net interest margin,
FTE
|
|
2.56
|
|
2.60
|
|
2.61
|
|
3.11
|
|
3.48
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Supplementary data (in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
Tax benefit on
tax-credit investments (7)
|
(O)
|
$
2,195
|
|
$ 2,057
|
|
$
596
|
|
$
595
|
|
$
620
|
|
Non-interest income
charge on tax-credit investments (8)
|
(P)
|
(1,789)
|
|
(1,448)
|
|
(357)
|
|
(351)
|
|
(445)
|
|
Net income on
tax-credit investments
|
(O+P)
|
406
|
|
609
|
|
239
|
|
244
|
|
175
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Intangible
amortization
|
(Q)
|
$
1,296
|
|
$ 1,288
|
|
$ 1,286
|
|
$ 1,286
|
|
$
1,285
|
|
Fully taxable
equivalent income adjustment
|
(R)
|
1,586
|
|
1,604
|
|
1,524
|
|
1,560
|
|
1,715
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(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
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 Nine
Months Ended
|
|
|
|
Sept. 30,
|
|
Sept. 30,
|
|
(in thousands)
|
|
|
2021
|
|
2022
|
|
Total
revenue
|
(A)
|
|
$
343,693
|
|
$
295,788
|
|
Adj: Net securities
losses (1)
|
|
|
681
|
|
2,194
|
|
Adj: Net (gains) on
sale of business operations and assets
|
|
|
(51,885)
|
|
-
|
|
Total adjusted
revenue (2)
|
(B)
|
|
$
292,489
|
|
$
297,982
|
|
|
|
|
|
|
|
|
Total non-interest
expense
|
(C)
|
|
$
216,486
|
|
$
218,702
|
|
Less: Merger,
restructuring and other expense
|
|
|
(4,917)
|
|
(11,526)
|
|
Adjusted non-interest
expense (2)
|
(D)
|
|
$
211,569
|
|
$
207,176
|
|
|
|
|
|
|
|
|
Pre-tax, pre-provision
net revenue (PPNR)
|
(A-C)
|
|
$
127,207
|
|
$ 77,086
|
|
Adjusted pre-tax,
pre-provision net revenue (PPNR)
|
(B-D)
|
|
80,920
|
|
90,806
|
|
|
|
|
|
|
|
|
Net income
|
|
|
$ 98,416
|
|
$ 62,028
|
|
Adj: Net securities
losses (1)
|
|
|
681
|
|
2,194
|
|
Adj: Net (gains) on
sale of business operations and assets
|
|
|
(51,885)
|
|
-
|
|
Adj: Restructuring
expense and other expense
|
|
|
4,917
|
|
11,526
|
|
Adj: Income taxes
benefit/(expense)
|
|
|
11,685
|
|
(3,469)
|
|
Total adjusted
income/(loss) (2)
|
(E)
|
|
$ 63,814
|
|
$ 72,279
|
|
|
|
|
|
|
|
|
(in millions, except per share
data)
|
|
|
|
|
|
|
Total average
assets
|
(F)
|
|
$ 12,268
|
|
$ 11,355
|
|
Total average
shareholders'
equity
|
(G)
|
|
1,161
|
|
1,187
|
|
Total average tangible
shareholders' equity (2)(3)
|
(H)
|
|
1,128
|
|
1,159
|
|
Total average tangible
common shareholders' equity (2)(3)
|
(I)
|
|
1,128
|
|
1,159
|
|
Total tangible
shareholders' equity, period-end (2)(3)
|
(J)
|
|
1,147
|
|
917
|
|
Total tangible common
shareholders' equity, period-end (2)(3)
|
(K)
|
|
1,147
|
|
917
|
|
Total tangible assets,
period-end (2)(3)
|
(L)
|
|
11,815
|
|
11,291
|
|
|
|
|
|
|
|
|
Total common shares
outstanding, period-end
(thousands)
|
(M)
|
|
48,657
|
|
45,040
|
|
Average diluted shares
outstanding (thousands)
|
(N)
|
|
49,963
|
|
46,396
|
|
|
|
|
|
|
|
|
GAAP earnings/(loss)
per common share, diluted (2)
|
|
|
$
1.97
|
|
$
1.34
|
|
Adjusted earnings per
common share, diluted (2)
|
(E/N)
|
|
1.28
|
|
1.56
|
|
Tangible book value per
common share, period-end (2)
|
(K/M)
|
|
23.58
|
|
20.36
|
|
Total tangible
shareholders' equity/total tangible assets (2)
|
(J/L)
|
|
9.71
|
|
8.12
|
|
|
|
|
|
|
|
|
Performance ratios (4)
|
|
|
|
|
|
|
GAAP return on
equity
|
|
|
11.30
|
%
|
6.97
|
%
|
Adjusted return on
equity (2)
|
(E/G)
|
|
7.33
|
|
8.12
|
|
Return on tangible
common equity (2)(5)
|
|
|
11.97
|
|
7.46
|
|
Adjusted return on
tangible common equity (2)(5)
|
(E+Q)/(I)
|
|
7.88
|
|
8.64
|
|
GAAP return on
assets
|
|
|
1.07
|
|
0.73
|
|
Adjusted return on
assets (2)
|
|
|
0.69
|
|
0.85
|
|
PPNR from continuing
operations/assets (2)
|
|
|
1.38
|
|
0.91
|
|
Adjusted
PPNR/assets (2)
|
|
|
0.88
|
|
1.07
|
|
Efficiency ratio
(2)(6)
|
(D-Q)/(B+O+R)
|
|
69.32
|
|
66.75
|
|
Net interest margin,
FTE
|
|
|
2.60
|
|
3.05
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Supplementary data (in thousands)
|
|
|
|
|
|
|
Tax benefit on
tax-credit investments (7)
|
(O)
|
|
$
2,315
|
|
$
1,811
|
|
Non-interest income
charge on tax-credit investments (8)
|
(P)
|
|
(1,996)
|
|
(1,153)
|
|
Net income on
tax-credit investments
|
(O+P)
|
|
319
|
|
658
|
|
|
|
|
|
|
|
|
Intangible
amortization
|
(Q)
|
|
$
3,912
|
|
$
3,857
|
|
Fully taxable
equivalent income adjustment
|
(R)
|
|
4,739
|
|
4,799
|
|
|
|
|
|
|
|
|
(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
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.