BOSTON, Jan. 26,
2023 /PRNewswire/ -- Berkshire Hills Bancorp, Inc.
(NYSE: BHLB) today reported that fourth quarter 2022 earnings per
share ("EPS") increased year-over-year by 64% to a fourth quarter
record $0.69. For these
periods, the non-GAAP measure of adjusted EPS increased by 52% to
$0.64.
For the full year 2022, EPS decreased year-over-year by 15% to
$2.02, and adjusted EPS increased by
30% to $2.19. GAAP results
included gains in 2021 on the sale of business operations and
charges in both years for branch consolidations. These are
the primary items excluded from the measure of adjusted
results.
Improvements in adjusted results for the fourth quarter and full
year 2022 demonstrate positive operating leverage and progress from
Berkshire's BEST strategic
initiatives. Compared to the prior quarter, results included
an 11% increase in net interest income, in conjunction with an
increase in the net interest margin to 3.84%.
FOURTH QUARTER FINANCIAL HIGHLIGHTS (Changes are
quarter-over-quarter unless otherwise stated. Non-GAAP
measures are reconciled on pages F-9 and F-10).
- 10.1% return on equity; 10.6% return on tangible common equity
(non-GAAP)
- 1.08% return on assets; 1.00% adjusted return on assets
(non-GAAP)
- 9% increase quarter-over-quarter in total net revenue
- 3.84% net interest margin, increased from 3.48% in 3Q22 and
2.60% in 4Q21
- 58% efficiency ratio, improved from 62% in 3Q22 and 72% in
4Q21
- 1% increase in full year non-interest expense; flat adjusted
non-interest expense (non-GAAP)
- 5% broad-based loan growth (end of period)
- 1% increase in average deposits
- 0.60% delinquent and non-accruing loans/total loans – lowest in
more than a decade
- 9% reduction in period-end shares outstanding year-over-year
reflecting stock buybacks
-
- 50% increase in quarterly shareholder dividend in the fourth
quarter of 2022
CEO Nitin Mhatre stated
"Berkshire finished the year with
strong loan growth momentum, resulting in record fourth quarter
revenue and earnings per share. The balance sheet
remains strong and positively positioned to benefit from potential
future interest rate increases. With these solid
underpinnings, Berkshire increased
its quarterly shareholder dividend by 50% in the fourth quarter, as
well as repurchasing 2% of shares. We're pleased that our
results have contributed to strong outperformance by our stock
compared to the broad market and our industry. BHLB provided
a 2022 calendar year total shareholder return exceeding 7% against
a backdrop of market declines, with the S&P 500 index posting a
negative 18% total return for the year."
"We have separately announced our CFO hire, and this follows
recently announced executive hires for Commercial Banking and
Credit. I'm pleased with the exceptional caliber of
executives who are attracted by our strong team, promising business
prospects, and purpose-focused vision. We also announced a
$50 million share repurchase program
for 2023, continuing our focus on balanced capital management and
shareholder distributions."
"Berkshire's return on assets
and return on tangible common equity improved to within its target
range at the halfway point of its three year strategic plan.
Berkshire also achieved the
highest ESG ranking in our history, with a top 17% composite
performance ranking in leading ESG indexes in the U.S. for its
Environmental, Social and Governance ratings. We also recorded our
highest employee engagement through our survey platform with
Mercer. We rolled-out promotion of our new brand campaign theme of
"Where You Bank Matters", which captures the spirit of our vision
to serve as a high-performing leading socially responsible
community bank for all of our stakeholders. I thank the
entire Berkshire team for our
success in 2022 and all they do to maintain our forward momentum in
delivering on our vision."
RESULTS OF OPERATIONS
Earnings: Fourth quarter 2022 EPS of $0.69 increased from $0.42 in the prior quarter, while adjusted EPS
increased by 2% from $0.62 to
$0.64. Adjusted results
benefited from higher net interest income and lending related fee
revenue. The increase in GAAP EPS also reflected a reduction in
accrued branch consolidation expenses based on a reduction in total
estimated costs.
On a year-over-year basis, fourth quarter results also increased
from $0.42 reported for both GAAP EPS
and adjusted EPS in 2021. This improvement was primarily due
to higher net interest income, which has reflected growth in loans
and in the interest margin in each of the last several quarters.
Fourth quarter revenue increased by 30% year-over-year, while
expense growth was held to 1%. The resulting positive operating
leverage led to an improvement in the efficiency ratio to 58% in
the most recent quarter, compared to 62% in the linked quarter and
to 72% in the fourth quarter of 2021.
The fourth quarter 2022 return on equity measured 10.1% and the
non-GAAP measure of adjusted return on tangible common equity
measured 9.8%. The return on assets measured 1.08% and the non-GAAP
measure of adjusted return on assets measured 1.00%.
Pre-tax Pre-Provision Net Revenue ("PPNR") increased
quarter-over-quarter by 79% to $48
million and the non-GAAP measure of adjusted PPNR increased
by 16% to $45 million. Adjusted PPNR
more than doubled from $21 million on
a year-over-year basis and moved within the Company's target
range at the halfway point of its three year strategic plan.
Revenue: Revenue increased by 9%
quarter-over-quarter and 30% year-over-year. Net interest
income has been the primary driver of revenue growth in recent
periods. Fourth quarter net interest income increased
by $10 million, or 11%, compared to
the linked quarter and by $33
million, or 47%, compared to the fourth quarter of
2021. The net interest margin has increased in successive
quarters over the last year, reaching 3.84% in the fourth quarter
of 2022, compared to 3.48% in the prior quarter and 2.60% in the
fourth quarter of 2021.
This improvement was primarily due to the benefit of loan growth
and positive sensitivity to increased market interest rates. The
yield on average earning assets improved quarter-over-quarter to
4.56% from 3.91%. The cost of funds increased to 0.77% from
0.46%, while the cost of deposits increased to 0.69% from
0.33%. 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.
Fee income benefited quarter-over-quarter from a $1 million increase in loan related fees, which
partially offset the impact of higher charges for tax credit
investment amortization. Fourth quarter fee income decreased
year-over-year primarily due to the impact of lower SBA related
fees in 2022 resulting from changes in the SBA program and in
market demand.
Provision for Credit Losses on Loans: Berkshire recorded a $12 million provision for credit losses in the
fourth quarter of 2022, bringing the full year provision to
$11 million. The full year 2021
provision was a benefit of $0.5
million. Both years benefited from releases of
pandemic related reserves, and the increase in 2022 also reflected
a resumption of loan growth and changes in the loan mix. The
fourth-quarter provision primarily reflected the impact of one
commercial and industrial credit which filed for bankruptcy in the
fourth quarter.
Non-Interest Expense and Tax Expense: Full year
non-interest expense increased by 1% in 2022, while adjusted
non-interest expense was flat.
Fourth quarter non-interest expense totaled $70 million in 2022, decreasing by 14%
quarter-over-quarter and increasing by 1% on a year-over-year basis
due primarily to branch consolidation expense. Fourth quarter
adjusted non-interest expense totaled $73 million which was a 3% increase
quarter-over-quarter and a 6% increase year-over-year.
Technology costs reflect continued investment in digitization and
the category of all other expenses increased primarily due to loan
related costs. Full time equivalent staff totaled 1,310 positions
at period-end, compared to 1,319 positions at the start of the
year.
The effective GAAP tax rate was 15% in the final quarter and 19%
for the year 2022, compared to 20% for the year 2021.
Due to the timing of tax credit investments, both tax expense
and non-interest income were reduced in the fourth quarter.
These investments contributed $0.03
to EPS in the year 2022, compared to $0.02 in the year 2021.
BALANCE SHEET (references are to period-end balances
unless otherwise stated)
Summary: Total loans grew by 5%
quarter-over-quarter and by 22% year-over-year. Total deposits
increased by 3% quarter-over-quarter and year-over-year.
Period-end liquidity and capital remained strong, with the ratio of
loans/deposits measuring 81% and the non-GAAP measure of tangible
common equity/tangible assets measuring 8.0%.
Loans: Fourth quarter loan growth was concentrated
in a $231 million increase in
commercial loans and a $183 million
increase in residential mortgages. For the full year,
commercial loans increased by $640
million and residential mortgages increased by $824 million. Berkshire has expanded its lending teams
over the last year, and business volumes and credit usage have
benefited in some segments from improved market demand.
Loan growth has also benefited from a decline in prepayments in the
prevailing rising rate environment. All major loan categories
increased by double digits in 2022 except for home equity
loans. Reflecting higher interest rates, the fourth quarter
loan yield increased year-over-year to 5.28% from 3.76%.
Asset Quality: Total delinquent and
non-accruing loans measured 0.60% of total loans at year-end, the
lowest in more than a decade. Reflecting the improved quality
of the loan portfolio, the allowance for expected credit losses on
loans declined to 1.15% of total loans from 1.21% at the start of
the quarter. Net loan charge-offs totaled $12 million in the fourth quarter and
$21 million for the year, or 0.27% of
full year average loans. Charge-offs were concentrated in the
second half of the year in one commercial and industrial credit
which filed for bankruptcy in the fourth quarter.
Deposits: Total deposits increased by 3%
year-over-year and quarter-over-quarter including higher period-end
payroll deposit balances. Average deposits increased by 1%
quarter-over-quarter and decreased by 2% year-over-year, including
the impact of lower brokered time deposits. The fourth quarter cost
of deposits increased year-over-year to 0.69% from 0.19%, including
a 0.36% increase over the third quarter of 2022.
Equity: Total fourth quarter shareholders' equity
increased quarter-over-quarter by 1% to $954
million. Stock buybacks in the most recent quarter
totaled approximately $20 million
consisting of approximately 661,000 shares. For the year
2022, stock repurchases totaled $125
million, consisting of 4.5 million shares. At
period-end, book value per share totaled $21.51 and the non-GAAP measure of tangible book
value per share totaled $20.95; both
measures increased by 3% quarter-over-quarter.
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: Berkshire continues to accelerate progress
towards the achievement of its "BEST Community Comeback" goals as
it tracks inline or slightly ahead of program targets at year-end.
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 and recent results can be found
at berkshirebank.com/comeback.
- Current ESG Performance: The Company improved on its
BEST ESG goal with a top 17% composite performance in leading ESG
indexes in the U.S. for its Environmental, Social and Governance
(ESG) ratings. This included an upgraded rating from MSCI to
"A". As of December 31, 2022
the Company has ratings of: MSCI ESG- A; ISS ESG Quality Score -
Environment: 3, Social: 1, Governance: 2; and Bloomberg ESG
Disclosure- 62.81. The Company is also rated by
Sustainalytics. Berkshire
continues to rank among the top 1% of all U.S. Banks for ESG in
Bloomberg.
- Sustainable Business Award: The Sustainable Business
Network named the Company Massachusetts Sustainable Business of the
Year in the bank category in recognition of its collective efforts
to build a more equitable economy and sustainable communities. This
includes Berkshire's initial
impact from the BEST Community Comeback, its sustainable financing
activities along with work to create a more diverse, equitable and
inclusive workplace.
- Sustainability Bond: Berkshire has begun to allocate proceeds from
its June 2022 Sustainability Bond
issuance to eligible activities. The Company became the first
public community bank with assets under $150
billion to issue a bond whose proceeds would be dedicated to
social and environmental projects. Projects supported to date have
created affordable housing, reduced greenhouse gas emissions and
constructed green buildings.
INVESTOR CONFERENCE CALL AND INVESTOR PRESENTATION
Berkshire will conduct a conference
call/webcast at 10:00 a.m. eastern
time on Thursday, January 26, 2023 to discuss results for
the quarter and provide guidance about expected future
results. The Company will also place an investor presentation
at its website at ir.berkshirebank.com.
Participants are encouraged to pre-register for the conference
call using the following link:
https://www.netroadshow.com/events/login?show=5437e05c&confId=45736
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: 522984. 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: 971852. The webcast
will be available on Berkshire's website for an extended
period of time.
ABOUT BERKSHIRE HILLS
BANCORP
Headquartered in Boston,
Berkshire Hills Bancorp (NYSE:BHLB) is the parent of Berkshire
Bank. Founded in 1846, the Bank's vision is to serve as a
high-performing leading socially responsible community bank. It
empowers the financial potential of its stakeholders by making
banking available where, when and how it's needed through an
uncompromising focus on exceptional customer service, digital
banking, and positive community impact. Providing a wide range of
financial solutions through its consumer banking, commercial
banking and wealth management divisions, the Bank has approximately
$11.7 billion in assets and a
community-based footprint of 100 financial centers in Massachusetts, New
York, Vermont, Connecticut and Rhode Island. Named one of America's Most
Trusted Companies 2022 by Newsweek, Berkshire is also listed in the Bloomberg
Gender-Equality Index and a Best Place to Work for LGBTQ+
Equality. To learn more, 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 and fourth quarters 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
TABLE
INDEX
|
CONSOLIDATED UNAUDITED
FINANCIAL SCHEDULES
|
F-1
|
Selected Financial
Highlights
|
F-2
|
Balance
Sheets
|
F-3
|
Loan and Deposit
Analysis
|
F-4
|
Statements of
Income
|
F-5
|
Statements of Income
(Five Quarter Trend)
|
F-6
|
Average Balances and
Average Yields and Costs
|
F-7
|
Asset Quality
Analysis
|
F-8
|
Asset Quality Analysis
(continued)
|
F-9
|
Reconciliation of
Non-GAAP Financial Measures
and Supplementary Data (Five Quarter Trend)
|
F-10
|
Reconciliation of
Non-GAAP Financial Measures
and Supplementary Data (Year-to-Date)
|
BERKSHIRE HILLS BANCORP, INC.
|
SELECTED FINANCIAL HIGHLIGHTS - UNAUDITED -
(F-1)
|
|
|
|
|
|
|
|
|
|
Dec. 31,
|
|
March 31,
|
|
June 30,
|
|
Sept. 30,
|
|
Dec. 31,
|
|
|
|
|
|
2021
|
|
2022
|
|
2022
|
|
2022
|
|
2022
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NOMINAL AND PER SHARE DATA
|
|
|
|
|
|
|
|
|
|
|
|
|
Net earnings per common
share, diluted
|
$
0.42
|
|
$
0.42
|
|
$
0.50
|
|
$
0.42
|
|
$
0.69
|
|
|
|
Adjusted earnings per
common share, diluted (2)
|
0.42
|
|
0.43
|
|
0.51
|
|
0.62
|
|
0.64
|
|
|
|
Net income,
(thousands)
|
20,248
|
|
20,196
|
|
23,115
|
|
18,717
|
|
30,505
|
|
|
|
Adjusted net income,
(thousands) (2)
|
20,172
|
|
20,789
|
|
23,562
|
|
27,928
|
|
28,254
|
|
|
|
Total common shares
outstanding, end of period (thousands)
|
48,667
|
|
47,792
|
|
45,788
|
|
45,040
|
|
44,361
|
|
|
|
Average diluted shares,
(thousands)
|
48,340
|
|
48,067
|
|
46,102
|
|
45,034
|
|
44,484
|
|
|
|
Total book value per
common share, (end of period)
|
24.30
|
|
22.89
|
|
22.15
|
|
20.93
|
|
21.51
|
|
|
|
Tangible book value per
common share, (end of period) (2)
|
23.69
|
|
22.30
|
|
21.56
|
|
20.36
|
|
20.95
|
|
|
|
Dividends per common
share
|
0.12
|
|
0.12
|
|
0.12
|
|
0.12
|
|
0.18
|
|
|
|
Full-time equivalent
staff
|
1,319
|
|
1,333
|
|
1,322
|
|
1,300
|
|
1,310
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
PERFORMANCE RATIOS (3)
|
|
|
|
|
|
|
|
|
|
|
|
|
Return on
equity
|
6.86
|
%
|
6.79
|
%
|
7.82
|
%
|
6.30
|
%
|
10.06
|
%
|
|
|
Adjusted return on
equity (2)
|
6.83
|
|
6.99
|
|
7.97
|
|
9.40
|
|
9.32
|
|
|
|
Return on tangible
common equity (2)
|
7.37
|
|
7.29
|
|
8.33
|
|
6.76
|
|
10.59
|
|
|
|
Adjusted return on
tangible common equity (2)
|
7.34
|
|
7.49
|
|
8.48
|
|
9.92
|
|
9.83
|
|
|
|
Return on
assets
|
0.71
|
|
0.70
|
|
0.82
|
|
0.66
|
|
1.08
|
|
|
|
Adjusted return on
assets (2)
|
0.71
|
|
0.72
|
|
0.84
|
|
0.99
|
|
1.00
|
|
|
|
Net interest margin,
fully taxable equivalent (FTE) (4)(5)
|
2.60
|
|
2.61
|
|
3.11
|
|
3.48
|
|
3.84
|
|
|
|
Efficiency ratio
(2)
|
71.98
|
|
72.61
|
|
66.60
|
|
62.01
|
|
58.25
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FINANCIAL DATA (in millions, end of
period)
|
|
|
|
|
|
|
|
|
|
|
|
|
Total assets
|
|
$
11,555
|
|
$ 12,097
|
|
$ 11,579
|
|
$ 11,317
|
|
$
11,663
|
|
|
|
Total earning
assets
|
10,899
|
|
11,401
|
|
10,849
|
|
10,604
|
|
10,913
|
|
|
|
Total loans
|
|
6,826
|
|
7,267
|
|
7,803
|
|
7,943
|
|
8,335
|
|
|
|
Total
deposits
|
|
10,069
|
|
10,699
|
|
10,115
|
|
9,988
|
|
10,327
|
|
|
|
Loans/deposits
(%)
|
68
|
%
|
68
|
%
|
77
|
%
|
80
|
%
|
81
|
%
|
|
|
Total shareholders'
equity
|
$
1,182
|
|
$
1,094
|
|
$
1,014
|
|
$
943
|
|
$
954
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ASSET QUALITY
|
|
|
|
|
|
|
|
|
|
|
|
|
Allowance for credit
losses, (millions)
|
$
106
|
|
$
99
|
|
$
99
|
|
$
96
|
|
$
96
|
|
|
|
Net charge-offs,
(millions)
|
(4)
|
|
(3)
|
|
(0)
|
|
(6)
|
|
(12)
|
|
|
|
Net charge-offs (QTD
annualized)/average loans
|
0.23
|
%
|
0.15
|
%
|
0.02
|
%
|
0.30
|
%
|
0.58
|
%
|
|
|
Provision
(benefit)/expense, (millions)
|
$
(3)
|
|
$
(4)
|
|
$
-
|
|
$
3
|
|
$
12
|
|
|
|
Non-performing assets,
(millions)
|
37
|
|
32
|
|
29
|
|
40
|
|
33
|
|
|
|
Non-performing
loans/total loans
|
0.52
|
%
|
0.41
|
%
|
0.34
|
%
|
0.48
|
%
|
0.37
|
%
|
|
|
Allowance for credit
losses/non-performing loans
|
300
|
|
335
|
|
368
|
|
254
|
|
309
|
|
|
|
Allowance for credit
losses/total loans
|
1.55
|
|
1.37
|
|
1.27
|
|
1.21
|
|
1.15
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CAPITAL RATIOS
|
|
|
|
|
|
|
|
|
|
|
|
|
Common equity tier 1
capital to risk weighted assets(6)
|
15.0
|
%
|
13.9
|
%
|
12.9
|
%
|
12.7
|
%
|
12.4
|
%
|
|
|
Tier 1 capital leverage
ratio(6)
|
10.5
|
|
10.3
|
|
10.2
|
|
10.1
|
|
10.2
|
|
|
|
Tangible common
shareholders' equity/tangible assets(2)
|
10.0
|
|
8.8
|
|
8.5
|
|
8.1
|
|
8.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(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%, 0.03%, 0.03%,
0.01%, 0.00%
|
|
(6)
|
Presented as projected
for December 31, 2022 and actual for the remaining
periods.
|
BERKSHIRE HILLS
BANCORP, INC.
|
CONSOLIDATED BALANCE SHEETS - UNAUDITED -
(F-2)
|
|
December
31,
|
September
30,
|
December 31,
|
|
(in thousands)
|
2021
|
2022
|
2022
|
|
Assets
|
|
|
|
|
Cash and due from
banks
|
$
109,350
|
$
128,509
|
$
145,342
|
|
Short-term
investments
|
1,518,457
|
566,404
|
540,013
|
|
Total cash and cash
equivalents
|
1,627,807
|
694,913
|
685,355
|
|
|
|
|
|
|
Trading
security
|
8,354
|
6,812
|
6,708
|
|
Marketable equity
securities, at fair value
|
15,453
|
12,790
|
12,856
|
|
Securities available
for sale, at fair value
|
1,877,585
|
1,470,949
|
1,423,200
|
|
Securities held to
maturity, at amortized cost
|
636,503
|
592,503
|
583,453
|
|
Federal Home Loan Bank
stock and other restricted securities
|
10,800
|
7,264
|
7,219
|
|
Total
securities
|
2,548,695
|
2,090,318
|
2,033,436
|
|
Less: Allowance for
credit losses on investment securities
|
(105)
|
|
(91)
|
|
Net
securities
|
2,548,590
|
2,090,223
|
2,033,345
|
|
|
|
|
|
|
Loans held for
sale
|
6,110
|
4,124
|
4,311
|
|
|
|
|
|
|
Total loans
|
6,825,847
|
7,943,481
|
8,335,309
|
|
Less: Allowance for
credit losses on loans
|
(106,094)
|
(96,013)
|
(96,270)
|
|
Net loans
|
6,719,753
|
7,847,468
|
8,239,039
|
|
|
|
|
|
|
Premises and equipment,
net
|
94,383
|
86,809
|
85,217
|
|
Goodwill and other
intangible assets
|
29,619
|
25,761
|
24,483
|
|
Other assets
|
524,074
|
563,946
|
587,854
|
|
Assets held for
sale
|
4,577
|
3,830
|
3,260
|
|
Total assets
|
$
11,554,913
|
$
11,317,074
|
$
11,662,864
|
|
|
|
|
|
|
Liabilities and shareholders'
equity
|
|
|
|
|
Demand
deposits
|
$
3,008,461
|
$
2,896,659
|
$
2,852,127
|
|
NOW and other
deposits
|
976,401
|
1,045,970
|
1,054,596
|
|
Money market
deposits
|
3,293,526
|
3,388,932
|
3,723,570
|
|
Savings
deposits
|
1,111,625
|
1,111,304
|
1,063,269
|
|
Time
deposits
|
1,678,940
|
1,545,256
|
1,633,707
|
|
Total
deposits
|
10,068,953
|
9,988,121
|
10,327,269
|
|
|
|
|
|
|
Senior
borrowings
|
13,331
|
4,494
|
4,445
|
|
Subordinated
borrowings
|
97,513
|
121,001
|
121,064
|
|
Total
borrowings
|
110,844
|
125,495
|
125,509
|
|
|
|
|
|
|
Other
liabilities
|
192,681
|
260,896
|
256,024
|
|
Total
liabilities
|
10,372,478
|
10,374,512
|
10,708,802
|
|
|
|
|
|
|
Common shareholders'
equity
|
1,182,435
|
942,562
|
954,062
|
|
Total shareholders'
equity
|
1,182,435
|
942,562
|
954,062
|
|
Total liabilities and
shareholders' equity
|
$
11,554,913
|
$
11,317,074
|
$
11,662,864
|
|
BERKSHIRE
HILLS BANCORP, INC.
|
|
CONSOLIDATED LOAN & DEPOSIT ANALYSIS - UNAUDITED
- (F-3)
|
|
LOAN ANALYSIS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Growth %
|
|
(in millions)
|
|
December 31, 2021
Balance
|
|
September 30,
2022
Balance
|
|
December 31, 2022
Balance
|
|
Quarter ended
December 31, 2022
|
|
Year to
Date
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total commercial real
estate
|
|
$
3,598
|
|
$
3,902
|
|
$
4,095
|
|
5
|
%
|
14
|
%
|
Commercial and
industrial loans
|
|
1,330
|
|
1,435
|
|
1,473
|
|
3
|
|
11
|
|
|
Total commercial
loans
|
|
4,928
|
|
5,337
|
|
5,568
|
|
4
|
|
13
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total residential
mortgages
|
|
1,392
|
|
2,033
|
|
2,216
|
|
9
|
|
59
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Home equity
|
|
253
|
|
234
|
|
227
|
|
(3)
|
|
(10)
|
|
|
Auto and
other
|
|
253
|
|
339
|
|
324
|
|
(4)
|
|
28
|
|
|
Total consumer
loans
|
|
506
|
|
573
|
|
551
|
|
(4)
|
|
9
|
|
|
Total loans
|
|
$
6,826
|
|
$
7,943
|
|
$
8,335
|
|
5
|
%
|
22
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
DEPOSIT ANALYSIS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Growth %
|
|
(in millions)
|
|
December 31, 2021
Balance
|
|
September 30,
2022
Balance
|
|
December 31, 2022
Balance
|
|
Quarter ended
December 31, 2022
|
|
Year to
Date
|
|
|
Non-interest
bearing
|
|
$
3,008
|
|
$
2,897
|
|
$
2,852
|
|
(2)
|
%
|
(5)
|
%
|
|
NOW and
other
|
|
976
|
|
1,046
|
|
1,054
|
|
1
|
|
8
|
|
|
Money market
|
|
3,294
|
|
3,389
|
|
3,724
|
|
10
|
|
13
|
|
|
Savings
|
|
1,112
|
|
1,111
|
|
1,063
|
|
(4)
|
|
(4)
|
|
|
Time
deposits
|
|
1,679
|
|
1,545
|
|
1,634
|
|
6
|
|
(3)
|
|
|
Total deposits
(1)
|
|
$
10,069
|
|
$
9,988
|
|
$
10,327
|
|
3
|
%
|
3
|
%
|
|
(1) Included in total
deposits are brokered deposits of $120.9 million, $163.5 million,
and $228.1 million at December 31, 2022, September 30, 2022,
and
|
December 31, 2021,
respectively.
|
|
|
BERKSHIRE
HILLS BANCORP, INC.
|
CONSOLIDATED STATEMENTS OF INCOME - UNAUDITED -
(F-4)
|
|
Three Months
Ended
|
|
Years
Ended
|
|
December
31,
|
|
December
31,
|
(in thousands, except per share
data)
|
2022
|
|
2021
|
|
2022
|
|
2021
|
Interest
income
|
$
121,384
|
|
$
75,860
|
|
$
387,257
|
|
$
329,065
|
Interest
expense
|
19,292
|
|
6,548
|
|
42,660
|
|
37,899
|
Net interest income,
not FTE
|
102,092
|
|
69,312
|
|
344,597
|
|
291,166
|
Non-interest income
|
|
|
|
|
|
|
|
Deposit related
fees
|
8,293
|
|
7,522
|
|
32,026
|
|
29,813
|
Loan fees and
revenue
|
5,058
|
|
9,098
|
|
21,731
|
|
35,060
|
Insurance commissions
and fees
|
-
|
|
-
|
|
-
|
|
7,003
|
Wealth management
fees
|
2,255
|
|
2,586
|
|
10,008
|
|
10,530
|
Mortgage banking
fees
|
44
|
|
259
|
|
230
|
|
2,056
|
Other
|
(159)
|
|
993
|
|
6,973
|
|
6,631
|
Total non-interest
income excluding gains/(losses)
|
15,491
|
|
20,458
|
|
70,968
|
|
91,093
|
Securities
gains/(losses), net
|
163
|
|
(106)
|
|
(2,031)
|
|
(787)
|
Gain on sale of
business operations and assets, net
|
-
|
|
1,057
|
|
-
|
|
52,942
|
Total non-interest
income
|
15,654
|
|
21,409
|
|
68,937
|
|
143,248
|
Total net revenue
|
117,746
|
|
90,721
|
|
413,534
|
|
434,414
|
Total net revenue
excluding (losses)
|
117,583
|
|
89,770
|
|
415,565
|
|
382,259
|
|
|
|
|
|
|
|
|
Provision
expense/(benefit) for credit losses
|
12,000
|
|
(3,000)
|
|
11,000
|
|
(500)
|
Non-interest expense
|
|
|
|
|
|
|
|
Compensation and
benefits
|
37,968
|
|
37,816
|
|
152,741
|
|
150,589
|
Occupancy and
equipment
|
9,431
|
|
9,738
|
|
37,638
|
|
41,782
|
Technology and
communications
|
9,729
|
|
8,599
|
|
35,586
|
|
33,803
|
Professional
services
|
3,153
|
|
2,365
|
|
12,043
|
|
15,860
|
Other
expenses
|
12,350
|
|
10,025
|
|
41,799
|
|
38,078
|
Merger, restructuring
and other non-operating expenses
|
(2,617)
|
|
864
|
|
8,909
|
|
5,781
|
Total non-interest
expense
|
70,014
|
|
69,407
|
|
288,716
|
|
285,893
|
Total non-interest
expense excluding merger, restructuring and other
|
72,631
|
|
68,543
|
|
279,807
|
|
280,112
|
|
|
|
|
|
|
|
|
Income before income
taxes
|
$
35,732
|
|
$
24,314
|
|
$
113,818
|
|
$
149,021
|
Income tax
expense
|
5,227
|
|
4,066
|
|
21,285
|
|
30,357
|
Net income
|
$
30,505
|
|
$
20,248
|
|
$
92,533
|
|
$
118,664
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings per common share
|
$
0.69
|
|
$
0.42
|
|
$
2.03
|
|
$
2.41
|
Diluted earnings per common
share
|
$
0.69
|
|
$
0.42
|
|
$
2.02
|
|
$
2.39
|
|
|
|
|
|
|
|
|
Weighted average shares
outstanding:
|
|
|
|
|
|
|
|
Basic
|
44,105
|
|
47,958
|
|
45,564
|
|
49,240
|
Diluted
|
44,484
|
|
48,340
|
|
45,914
|
|
49,554
|
|
|
|
|
|
|
|
|
BERKSHIRE HILLS BANCORP, INC.
|
CONSOLIDATED STATEMENTS OF INCOME (5 Quarter Trend) -
UNAUDITED - (F-5)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dec. 31,
|
|
March 31,
|
|
June 30,
|
|
Sept. 30,
|
|
Dec. 31,
|
|
(in thousands, except per share
data)
|
|
2021
|
|
2022
|
|
2022
|
|
2022
|
|
2022
|
|
Interest
income
|
|
$
75,860
|
|
$
74,823
|
|
$
87,379
|
|
$ 103,671
|
|
$ 121,384
|
|
Interest
expense
|
|
6,548
|
|
5,760
|
|
6,021
|
|
11,587
|
|
19,292
|
|
Net interest income,
not FTE
|
|
69,312
|
|
69,063
|
|
81,358
|
|
92,084
|
|
102,092
|
|
Non-interest
income
|
|
|
|
|
|
|
|
|
|
|
|
Deposit related
fees
|
|
7,522
|
|
7,351
|
|
8,005
|
|
8,377
|
|
8,293
|
|
Loan fees and
revenue
|
|
9,098
|
|
8,265
|
|
4,623
|
|
3,785
|
|
5,058
|
|
Insurance commissions
and fees
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
Wealth management
fees
|
|
2,586
|
|
2,625
|
|
2,775
|
|
2,353
|
|
2,255
|
|
Mortgage banking
fees
|
|
259
|
|
19
|
|
109
|
|
58
|
|
44
|
|
Other
|
|
993
|
|
3,166
|
|
1,812
|
|
2,154
|
|
(159)
|
|
Total non-interest
income excluding (losses)/gains
|
|
20,458
|
|
21,426
|
|
17,324
|
|
16,727
|
|
15,491
|
|
Securities
(losses)/gains, net
|
|
(106)
|
|
(745)
|
|
(973)
|
|
(476)
|
|
163
|
|
Gain on sale of
business operations and assets, net
|
|
1,057
|
|
-
|
|
-
|
|
-
|
|
-
|
|
Total non-interest
income
|
|
21,409
|
|
20,681
|
|
16,351
|
|
16,251
|
|
15,654
|
|
Total net revenue
|
|
90,721
|
|
89,744
|
|
97,709
|
|
108,335
|
|
117,746
|
|
Total net revenue
excluding (losses)/gains
|
|
89,770
|
|
90,489
|
|
98,682
|
|
108,811
|
|
117,583
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision
(benefit)/expense for credit losses
|
|
(3,000)
|
|
(4,000)
|
|
-
|
|
3,000
|
|
12,000
|
|
Non-interest expense
|
|
|
|
|
|
|
|
|
|
|
|
Compensation and
benefits
|
|
37,816
|
|
37,521
|
|
37,830
|
|
39,422
|
|
37,968
|
|
Occupancy and
equipment
|
|
9,738
|
|
10,067
|
|
9,438
|
|
8,702
|
|
9,431
|
|
Technology and
communications
|
|
8,599
|
|
8,527
|
|
8,611
|
|
8,719
|
|
9,729
|
|
Professional
services
|
|
2,365
|
|
2,692
|
|
2,913
|
|
3,285
|
|
3,153
|
|
Other
expenses
|
|
10,025
|
|
9,725
|
|
9,648
|
|
10,076
|
|
12,350
|
|
Merger, restructuring
and other non-operating expenses
|
|
864
|
|
18
|
|
35
|
|
11,473
|
|
(2,617)
|
|
Total non-interest
expense
|
|
69,407
|
|
68,550
|
|
68,475
|
|
81,677
|
|
70,014
|
|
Total non-interest
expense excluding merger, restructuring and other
|
|
68,543
|
|
68,532
|
|
68,440
|
|
70,204
|
|
72,631
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before income
taxes
|
|
$
24,314
|
|
$
25,194
|
|
$
29,234
|
|
$
23,658
|
|
$
35,732
|
|
Income tax
expense
|
|
4,066
|
|
4,998
|
|
6,119
|
|
4,941
|
|
5,227
|
|
Net income
|
|
$
20,248
|
|
$
20,196
|
|
$
23,115
|
|
$
18,717
|
|
$
30,505
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings per
common share
|
|
$
0.42
|
|
$
0.42
|
|
$
0.50
|
|
$
0.42
|
|
$
0.69
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average shares
outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
47,958
|
|
47,668
|
|
45,818
|
|
44,700
|
|
44,105
|
|
Diluted
|
|
48,340
|
|
48,067
|
|
46,102
|
|
45,034
|
|
44,484
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BERKSHIRE
HILLS BANCORP, INC.
|
AVERAGE BALANCES AND AVERAGE YIELDS AND COSTS -
UNAUDITED - (F-6)
|
|
|
|
|
Dec. 31,
2021
|
|
March 31,
2022
|
|
June 30,
2022
|
|
Sept. 30,
2022
|
|
Dec. 31,
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
|
|
3,569
|
3.49
|
%
|
3,651
|
3.35
|
%
|
3,831
|
3.79
|
%
|
3,926
|
4.53
|
%
|
3,934
|
5.46
|
%
|
Commercial and
industrial loans
|
|
1,278
|
4.37
|
|
|
1,373
|
4.14
|
|
|
1,447
|
4.46
|
|
|
1,449
|
5.21
|
|
|
1,471
|
6.62
|
|
|
Residential
mortgages
|
|
1,403
|
3.82
|
|
|
1,436
|
3.56
|
|
|
1,652
|
3.57
|
|
|
1,926
|
3.53
|
|
|
2,114
|
3.56
|
|
|
Consumer
loans
|
|
516
|
3.96
|
|
|
514
|
4.24
|
|
|
562
|
5.41
|
|
|
587
|
6.24
|
|
|
563
|
7.00
|
|
|
Total loans (1)
|
|
6,766
|
3.76
|
|
|
6,974
|
3.61
|
|
|
7,492
|
3.99
|
|
|
7,888
|
4.54
|
|
|
8,082
|
5.28
|
|
|
Securities
(2)
|
|
2,367
|
2.04
|
|
|
2,649
|
1.95
|
|
|
2,621
|
1.97
|
|
|
2,400
|
2.13
|
|
|
2,294
|
2.20
|
|
|
Short-term investments
and loans held for sale
|
|
1,609
|
0.17
|
|
|
1,202
|
0.17
|
|
|
476
|
0.57
|
|
|
342
|
1.96
|
|
|
267
|
3.05
|
|
|
Total earning assets
|
|
10,742
|
2.84
|
|
|
10,825
|
2.82
|
|
|
10,589
|
3.34
|
|
|
10,630
|
3.91
|
|
|
10,643
|
4.56
|
|
|
Goodwill and other
intangible assets
|
|
30
|
|
|
|
29
|
|
|
|
27
|
|
|
|
26
|
|
|
|
25
|
|
|
|
Other assets
|
|
655
|
|
|
|
639
|
|
|
|
644
|
|
|
|
659
|
|
|
|
653
|
|
|
|
Total assets
|
|
11,427
|
|
|
|
11,493
|
|
|
|
11,260
|
|
|
|
11,315
|
|
|
|
11,321
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities and shareholders'
equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NOW and
other
|
|
1,331
|
0.05
|
%
|
1,456
|
0.04
|
%
|
1,454
|
0.12
|
%
|
1,362
|
0.48
|
%
|
1,395
|
1.11
|
%
|
Money market
|
|
2,731
|
0.16
|
|
|
2,871
|
0.16
|
|
|
2,811
|
0.19
|
|
|
2,737
|
0.46
|
|
|
2,819
|
1.16
|
|
|
Savings
|
|
1,100
|
0.04
|
|
|
1,117
|
0.03
|
|
|
1,127
|
0.03
|
|
|
1,129
|
0.03
|
|
|
1,086
|
0.03
|
|
|
Time
|
|
1,750
|
0.80
|
|
|
1,624
|
0.71
|
|
|
1,460
|
0.64
|
|
|
1,528
|
0.85
|
|
|
1,555
|
1.21
|
|
|
Total interest-bearing deposits
|
|
6,912
|
0.28
|
|
|
7,068
|
0.24
|
|
|
6,852
|
0.24
|
|
|
6,756
|
0.48
|
|
|
6,855
|
0.98
|
|
|
Borrowings
(3)
|
|
121
|
5.68
|
|
|
122
|
5.21
|
|
|
160
|
4.61
|
|
|
251
|
5.46
|
|
|
169
|
5.56
|
|
|
Total interest-bearing
liabilities
|
|
7,033
|
0.37
|
|
|
7,190
|
0.32
|
|
|
7,012
|
0.34
|
|
|
7,007
|
0.66
|
|
|
7,024
|
1.09
|
|
|
Non-interest-bearing
demand deposits
|
|
3,038
|
|
|
|
2,968
|
|
|
|
2,903
|
|
|
|
2,913
|
|
|
|
2,876
|
|
|
|
Other
liabilities
|
|
175
|
|
|
|
146
|
|
|
|
163
|
|
|
|
206
|
|
|
|
208
|
|
|
|
Total
liabilities
|
|
10,246
|
|
|
|
10,304
|
|
|
|
10,078
|
|
|
|
10,126
|
|
|
|
10,108
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common shareholders'
equity
|
|
1,181
|
|
|
|
1,189
|
|
|
|
1,182
|
|
|
|
1,189
|
|
|
|
1,213
|
|
|
|
Total shareholders'
equity
|
|
1,181
|
|
|
|
1,189
|
|
|
|
1,182
|
|
|
|
1,189
|
|
|
|
1,213
|
|
|
|
Total liabilities and
shareholders' equity
|
|
11,427
|
|
|
|
11,493
|
|
|
|
11,260
|
|
|
|
11,315
|
|
|
|
11,321
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest
spread
|
|
|
2.47
|
%
|
|
2.50
|
%
|
|
2.99
|
%
|
|
3.25
|
%
|
|
3.47
|
%
|
Net interest margin,
FTE (4)
|
|
|
2.60
|
|
|
|
2.61
|
|
|
|
3.11
|
|
|
|
3.48
|
|
|
|
3.84
|
|
|
Cost of
funds
|
|
|
0.26
|
|
|
|
0.23
|
|
|
|
0.24
|
|
|
|
0.46
|
|
|
|
0.77
|
|
|
Cost of
deposits
|
|
|
0.19
|
|
|
|
0.17
|
|
|
|
0.17
|
|
|
|
0.33
|
|
|
|
0.69
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Supplementary data
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Interest Income,
not FTE
|
|
69.312
|
|
|
|
69.063
|
|
|
|
81.358
|
|
|
|
92.084
|
|
|
|
102.092
|
|
|
|
Fully taxable
equivalent income adjustment
|
|
1.604
|
|
|
|
1.524
|
|
|
|
1.560
|
|
|
|
1.715
|
|
|
|
1.845
|
|
|
|
Net Interest Income, FTE
|
|
70.916
|
|
|
|
70.587
|
|
|
|
82.918
|
|
|
|
93.799
|
|
|
|
103.937
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total average
non-maturity deposits
|
|
8,200
|
|
|
|
8,412
|
|
|
|
8,295
|
|
|
|
8,141
|
|
|
|
8,176
|
|
|
|
Total average
deposits
|
|
9,950
|
|
|
|
10,037
|
|
|
|
9,755
|
|
|
|
9,669
|
|
|
|
9,731
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Purchase accounting
accretion
|
|
1.548
|
|
|
|
0.717
|
|
|
|
0.773
|
|
|
|
0.280
|
|
|
|
0.182
|
|
|
|
Total average tangible
equity (5)
|
|
1,151
|
|
|
|
1,160
|
|
|
|
1,155
|
|
|
|
1,163
|
|
|
|
1,188
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(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) There was no effect
of PPP loans on the quarterly net interest margin for the quarters
presented.
|
(5) See page F-9 for
details on the calculation of total average tangible
equity.
|
BERKSHIRE HILLS BANCORP, INC.
|
ASSET QUALITY ANALYSIS - UNAUDITED -
(F-7)
|
|
|
|
|
Dec. 31,
|
|
March 31,
|
|
June 30,
|
|
Sept. 30,
|
|
Dec. 31,
|
|
(in thousands)
|
|
2021
|
|
2022
|
|
2022
|
|
2022
|
|
2022
|
|
NON-PERFORMING ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
Non-accruing
loans:
|
|
|
|
|
|
|
|
|
|
|
|
Commercial real
estate
|
|
$
13,954
|
|
$
8,984
|
|
$
8,277
|
|
$
2,976
|
|
$
2,434
|
|
Commercial and
industrial loans
|
|
6,747
|
|
5,618
|
|
4,891
|
|
21,008
|
|
17,023
|
|
Residential
mortgages
|
|
9,825
|
|
11,079
|
|
10,331
|
|
10,407
|
|
8,612
|
|
Consumer
loans
|
|
4,800
|
|
4,000
|
|
3,385
|
|
3,463
|
|
3,045
|
|
Total non-accruing
loans
|
|
35,326
|
|
29,681
|
|
26,884
|
|
37,854
|
|
31,114
|
|
Repossessed
assets
|
|
1,736
|
|
2,004
|
|
2,004
|
|
2,175
|
|
2,209
|
|
Total non-performing
assets
|
|
$
37,062
|
|
$
31,685
|
|
$
28,888
|
|
$
40,029
|
|
$
33,323
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total non-accruing
loans/total loans
|
|
0.52 %
|
|
0.41 %
|
|
0.34 %
|
|
0.48 %
|
|
0.37 %
|
|
Total non-performing
assets/total assets
|
|
0.32 %
|
|
0.26 %
|
|
0.25 %
|
|
0.35 %
|
|
0.29 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
PROVISION AND ALLOWANCE FOR CREDIT LOSSES ON
LOANS
|
|
|
|
|
|
|
|
|
|
Balance at beginning of
period
|
|
$
112,916
|
|
$
106,094
|
|
$
99,475
|
|
$
99,021
|
|
$
96,013
|
|
Charged-off
loans
|
|
(7,976)
|
|
(6,048)
|
|
(1,593)
|
|
(7,424)
|
|
(12,995)
|
|
Recoveries on
charged-off loans
|
|
4,154
|
|
3,429
|
|
1,139
|
|
1,416
|
|
1,252
|
|
Net loans
charged-off
|
|
(3,822)
|
|
(2,619)
|
|
(454)
|
|
(6,008)
|
|
(11,743)
|
|
Provision
(benefit)/expense for loan credit losses
|
|
(3,000)
|
|
(4,000)
|
|
-
|
|
3,000
|
|
12,000
|
|
Balance at end of
period
|
|
$
106,094
|
|
$
99,475
|
|
$
99,021
|
|
$
96,013
|
|
$
96,270
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Allowance for credit
losses/total loans
|
|
1.55 %
|
|
1.37 %
|
|
1.27 %
|
|
1.21 %
|
|
1.15 %
|
|
Allowance for credit
losses/non-accruing loans
|
|
300 %
|
|
335 %
|
|
368 %
|
|
254 %
|
|
309 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NET LOAN CHARGE-OFFS
|
|
|
|
|
|
|
|
|
|
|
|
Commercial real
estate
|
|
$
(2,208)
|
|
$
(3,280)
|
|
$
(76)
|
|
$
(854)
|
|
$
187
|
|
Commercial and
industrial loans
|
|
(1,649)
|
|
653
|
|
(237)
|
|
(4,931)
|
|
(10,914)
|
|
Residential
mortgages
|
|
(2)
|
|
(50)
|
|
(30)
|
|
122
|
|
192
|
|
Home equity
|
|
106
|
|
135
|
|
33
|
|
1
|
|
(128)
|
|
Auto and other
consumer
|
|
(69)
|
|
(77)
|
|
(144)
|
|
(346)
|
|
(1,080)
|
|
Total, net
|
|
$
(3,822)
|
|
$
(2,619)
|
|
$
(454)
|
|
$
(6,008)
|
|
$
(11,743)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net charge-offs (QTD
annualized)/average loans
|
|
0.23 %
|
|
0.15 %
|
|
0.02 %
|
|
0.30 %
|
|
0.58 %
|
|
Net charge-offs (YTD
annualized)/average loans
|
|
0.29 %
|
|
0.15 %
|
|
0.08 %
|
|
0.16 %
|
|
0.27 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BERKSHIRE
HILLS BANCORP, INC.
|
ASSET QUALITY ANALYSIS - UNAUDITED
(F-8)
|
|
|
|
December 31,
2021
|
|
March 31,
2022
|
|
June 30,
2022
|
|
September 30,
2022
|
|
December 31,
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
|
$ 39,863
|
|
0.58 %
|
|
$ 13,517
|
|
0.19 %
|
|
$ 36,184
|
|
0.46 %
|
|
$ 14,662
|
|
0.18 %
|
|
$ 12,162
|
|
0.15 %
|
|
90+ Days delinquent and
still accruing
|
3,270
|
|
0.05 %
|
|
6,613
|
|
0.09 %
|
|
6,760
|
|
0.09 %
|
|
6,285
|
|
0.08 %
|
|
7,038
|
|
0.08 %
|
|
Total accruing
delinquent loans
|
43,133
|
|
0.63 %
|
|
20,130
|
|
0.28 %
|
|
42,944
|
|
0.55 %
|
|
20,947
|
|
0.26 %
|
|
19,200
|
|
0.23 %
|
|
Non-accruing
loans
|
35,326
|
|
0.52 %
|
|
29,681
|
|
0.41 %
|
|
26,884
|
|
0.34 %
|
|
37,854
|
|
0.48 %
|
|
31,114
|
|
0.37 %
|
|
Total delinquent and
non-accruing loans
|
$ 78,459
|
|
1.15 %
|
|
$ 49,811
|
|
0.69 %
|
|
$ 69,828
|
|
0.89 %
|
|
$ 58,801
|
|
0.74 %
|
|
$ 50,314
|
|
0.60 %
|
|
BERKSHIRE HILLS BANCORP,
INC.
|
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES AND
SUPPLEMENTARY DATA- UNAUDITED - (F-9)
|
|
|
|
|
|
Dec. 31,
|
|
March 31,
|
|
June 30,
|
|
Sept. 30,
|
|
Dec. 31,
|
|
(in thousands)
|
|
2021
|
|
2022
|
|
2022
|
|
2022
|
|
2022
|
|
Total
revenue
|
(A)
|
$
90,721
|
|
$
89,744
|
|
$
97,709
|
|
$ 108,335
|
|
$ 117,746
|
|
Adj: Net securities
losses/(gains) (1)
|
|
106
|
|
745
|
|
973
|
|
476
|
|
(163)
|
|
Adj: Net (gains) on
sale of business operations and assets
|
|
(1,057)
|
|
-
|
|
-
|
|
-
|
|
-
|
|
Total adjusted
revenue (2)
|
(B)
|
$
89,770
|
|
$
90,489
|
|
$
98,682
|
|
$ 108,811
|
|
$ 117,583
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total non-interest
expense
|
(C)
|
$
69,407
|
|
$
68,550
|
|
$
68,475
|
|
$
81,677
|
|
$
70,014
|
|
Less: Merger,
restructuring and other expense
|
|
(864)
|
|
(18)
|
|
(35)
|
|
(11,473)
|
|
2,617
|
|
Adjusted non-interest
expense (2)
|
(D)
|
$
68,543
|
|
$
68,532
|
|
$
68,440
|
|
$
70,204
|
|
$
72,631
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pre-tax, pre-provision
net revenue (PPNR)
|
(A-C)
|
$
21,314
|
|
$
21,194
|
|
$
29,234
|
|
$
26,658
|
|
$
47,732
|
|
Adjusted pre-tax,
pre-provision net revenue (PPNR) (2)
|
(B-D)
|
21,227
|
|
21,957
|
|
30,242
|
|
38,607
|
|
44,952
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
|
$
20,248
|
|
$
20,196
|
|
$
23,115
|
|
$
18,717
|
|
$
30,505
|
|
Adj: Net securities
losses/(gains) (1)
|
|
106
|
|
745
|
|
973
|
|
476
|
|
(163)
|
|
Adj: Net (gains) on
sale of business operations and assets
|
|
(1,057)
|
|
-
|
|
-
|
|
-
|
|
-
|
|
Adj: Restructuring
expense and other expense
|
|
864
|
|
18
|
|
35
|
|
11,473
|
|
(2,617)
|
|
Adj: Income taxes
(expense)/benefit
|
|
11
|
|
(170)
|
|
(561)
|
|
(2,738)
|
|
529
|
|
Total adjusted
income (2)
|
(E)
|
$
20,172
|
|
$
20,789
|
|
$
23,562
|
|
$
27,928
|
|
$
28,254
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in millions, except per share
data)
|
|
|
|
|
|
|
|
|
|
|
|
Total average
assets
|
(F)
|
$
11,427
|
|
$
11,493
|
|
$
11,260
|
|
$
11,315
|
|
$
11,321
|
|
Total average
shareholders'
equity
|
(G)
|
1,181
|
|
1,189
|
|
1,182
|
|
1,189
|
|
1,213
|
|
Total average tangible
shareholders' equity (2)(3)
|
(H)
|
1,151
|
|
1,160
|
|
1,155
|
|
1,164
|
|
1,188
|
|
Total average tangible
common shareholders' equity (2)(3)
|
(I)
|
1,151
|
|
1,160
|
|
1,155
|
|
1,164
|
|
1,188
|
|
Total accumulated other
comprehensive (loss), period-end
|
|
(3)
|
|
(78)
|
|
(123)
|
|
(188)
|
|
(181)
|
|
Total tangible
shareholders' equity, period-end (2)(3)
|
(J)
|
1,153
|
|
1,066
|
|
987
|
|
917
|
|
930
|
|
Total tangible common
shareholders' equity, period-end (2)(3)
|
(K)
|
1,153
|
|
1,066
|
|
987
|
|
917
|
|
930
|
|
Total tangible assets,
period-end (2)(3)
|
(L)
|
11,525
|
|
12,069
|
|
11,552
|
|
11,291
|
|
11,638
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total common shares
outstanding, period-end
(thousands)
|
(M)
|
48,667
|
|
47,792
|
|
45,788
|
|
45,040
|
|
44,361
|
|
Average diluted shares
outstanding (thousands)
|
(N)
|
48,340
|
|
48,067
|
|
46,102
|
|
45,034
|
|
44,484
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP earnings per
common share, diluted (2)
|
|
$
0.42
|
|
$
0.42
|
|
$
0.50
|
|
$
0.42
|
|
$
0.69
|
|
Adjusted earnings per
common share, diluted (2)
|
(E/N)
|
0.42
|
|
0.43
|
|
0.51
|
|
0.62
|
|
0.64
|
|
Tangible book value per
common share, period-end (2)
|
(K/M)
|
23.69
|
|
22.30
|
|
21.56
|
|
20.36
|
|
20.95
|
|
Total tangible
shareholders' equity/total tangible assets (2)
|
(J/L)
|
10.00
|
|
8.83
|
|
8.54
|
|
8.12
|
|
7.99
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Performance ratios (4)
|
|
|
|
|
|
|
|
|
|
|
|
GAAP return on
equity
|
|
6.86
|
%
|
6.79
|
|
7.82
|
%
|
6.30
|
%
|
10.06
|
%
|
Adjusted return on
equity (2)
|
(E/G)
|
6.83
|
|
6.99
|
|
7.97
|
|
9.40
|
|
9.32
|
|
Return on tangible
common equity (2)(5)
|
|
7.37
|
|
7.29
|
|
8.33
|
|
6.76
|
|
10.59
|
|
Adjusted return on
tangible common equity (2)(5)
|
(E+Q)/(I)
|
7.34
|
|
7.49
|
|
8.48
|
|
9.92
|
|
9.83
|
|
GAAP return on
assets
|
|
0.71
|
|
0.70
|
|
0.82
|
|
0.66
|
|
1.08
|
|
Adjusted return on
assets (2)
|
|
0.71
|
|
0.72
|
|
0.84
|
|
0.99
|
|
1.00
|
|
PPNR from continuing
operations/assets (2)
|
|
0.75
|
|
0.74
|
|
1.04
|
|
0.94
|
|
1.69
|
|
Adjusted
PPNR/assets (2)
|
|
0.74
|
|
0.76
|
|
1.07
|
|
1.36
|
|
1.59
|
|
Efficiency ratio
(2)(6)
|
(D-Q)/(B+O+R)
|
71.98
|
|
72.61
|
|
66.60
|
|
62.01
|
|
58.25
|
|
Net interest margin,
FTE
|
|
2.60
|
|
2.61
|
|
3.11
|
|
3.48
|
|
3.84
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Supplementary data (in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
Tax benefit on
tax-credit investments (7)
|
(O)
|
$
2,057
|
|
$
596
|
|
$
595
|
|
$
620
|
|
$
3,068
|
|
Non-interest income
charge on tax-credit investments (8)
|
(P)
|
(1,448)
|
|
(357)
|
|
(351)
|
|
(445)
|
|
(2,355)
|
|
Net income on
tax-credit investments
|
(O+P)
|
609
|
|
239
|
|
244
|
|
175
|
|
713
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Intangible
amortization
|
(Q)
|
$
1,288
|
|
$
1,286
|
|
$
1,286
|
|
$
1,285
|
|
$
1,277
|
|
Fully taxable
equivalent income adjustment
|
(R)
|
1,604
|
|
1,524
|
|
1,560
|
|
1,715
|
|
1,845
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(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, new markets
|
and solar.
|
|
|
|
|
|
|
|
|
|
|
|
(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 Years
Ended
|
|
|
|
Dec. 31,
|
|
Dec. 31,
|
|
(in thousands)
|
|
|
2021
|
|
2022
|
|
Total
revenue
|
(A)
|
|
$
434,414
|
|
$
413,534
|
|
Adj: Net securities
losses (1)
|
|
|
787
|
|
2,031
|
|
Adj: Net (gains) on
sale of business operations and assets
|
|
|
(52,942)
|
|
-
|
|
Total adjusted
revenue (2)
|
(B)
|
|
$
382,259
|
|
$
415,565
|
|
|
|
|
|
|
|
|
Total non-interest
expense
|
(C)
|
|
$
285,893
|
|
$
288,716
|
|
Less: Merger,
restructuring and other expense
|
|
|
(5,781)
|
|
(8,909)
|
|
Adjusted non-interest
expense (2)
|
(D)
|
|
$
280,112
|
|
$
279,807
|
|
|
|
|
|
|
|
|
Pre-tax, pre-provision
net revenue (PPNR)
|
(A-C)
|
|
$
148,521
|
|
$
124,818
|
|
Adjusted pre-tax,
pre-provision net revenue (PPNR) (2)
|
(B-D)
|
|
102,147
|
|
135,758
|
|
|
|
|
|
|
|
|
Net income
|
|
|
$
118,664
|
|
$
92,533
|
|
Adj: Net securities
losses (1)
|
|
|
787
|
|
2,031
|
|
Adj: Net (gains) on
sale of business operations and assets
|
|
|
(52,942)
|
|
-
|
|
Adj: Restructuring
expense and other expense
|
|
|
5,781
|
|
8,909
|
|
Adj: Income taxes
benefit/(expense)
|
|
|
11,696
|
|
(2,940)
|
|
Total adjusted
income (2)
|
(E)
|
|
$
83,986
|
|
$
100,533
|
|
|
|
|
|
|
|
|
(in millions, except per share
data)
|
|
|
|
|
|
|
Total average
assets
|
(F)
|
|
$
12,056
|
|
$
11,347
|
|
Total average
shareholders'
equity
|
(G)
|
|
1,166
|
|
1,193
|
|
Total average tangible
shareholders' equity (2)(3)
|
(H)
|
|
1,134
|
|
1,166
|
|
Total average tangible
common shareholders' equity (2)(3)
|
(I)
|
|
1,134
|
|
1,166
|
|
Total accumulated other
comprehensive (loss), period-end
|
|
|
(3)
|
|
(181)
|
|
Total tangible
shareholders' equity, period-end (2)(3)
|
(J)
|
|
1,153
|
|
930
|
|
Total tangible common
shareholders' equity, period-end (2)(3)
|
(K)
|
|
1,153
|
|
930
|
|
Total tangible assets,
period-end (2)(3)
|
(L)
|
|
11,525
|
|
11,638
|
|
|
|
|
|
|
|
|
Total common shares
outstanding, period-end
(thousands)
|
(M)
|
|
48,667
|
|
44,361
|
|
Average diluted shares
outstanding (thousands)
|
(N)
|
|
49,554
|
|
45,914
|
|
|
|
|
|
|
|
|
GAAP earnings/(loss)
per common share, diluted (2)
|
|
|
$
2.39
|
|
$
2.02
|
|
Adjusted earnings per
common share, diluted (2)
|
(E/N)
|
|
1.69
|
|
2.19
|
|
Tangible book value per
common share, period-end (2)
|
(K/M)
|
|
23.69
|
|
20.95
|
|
Total tangible
shareholders' equity/total tangible assets (2)
|
(J/L)
|
|
10.00
|
|
7.99
|
|
|
|
|
|
|
|
|
Performance ratios (4)
|
|
|
|
|
|
|
GAAP return on
equity
|
|
|
10.18
|
%
|
7.76
|
%
|
Adjusted return on
equity (2)
|
(E/G)
|
|
7.20
|
|
8.43
|
|
Return on tangible
common equity (2)(5)
|
|
|
10.80
|
|
8.26
|
|
Adjusted return on
tangible common equity (2)(5)
|
(E+Q)/(I)
|
|
7.74
|
|
8.94
|
|
GAAP return on
assets
|
|
|
0.98
|
|
0.82
|
|
Adjusted return on
assets (2)
|
|
|
0.70
|
|
0.89
|
|
PPNR from continuing
operations/assets (2)
|
|
|
1.23
|
|
1.10
|
|
Adjusted
PPNR/assets (2)
|
|
|
0.85
|
|
1.20
|
|
Efficiency ratio
(2)(6)
|
(D-Q)/(B+O+R)
|
|
69.96
|
|
64.31
|
|
Net interest margin,
FTE
|
|
|
2.60
|
|
3.26
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Supplementary data (in thousands)
|
|
|
|
|
|
|
Tax benefit on
tax-credit investments (7)
|
(O)
|
|
$
4,372
|
|
$
4,880
|
|
Non-interest income
charge on tax-credit investments (8)
|
(P)
|
|
(3,445)
|
|
(3,508)
|
|
Net income on
tax-credit investments
|
(O+P)
|
|
928
|
|
1,372
|
|
|
|
|
|
|
|
|
Intangible
amortization
|
(Q)
|
|
$
5,200
|
|
$
5,134
|
|
Fully taxable
equivalent income adjustment
|
(R)
|
|
6,344
|
|
6,644
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(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,
|
|
new markets, and
solar.
|
|
|
|
|
|
|
(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.