NEW CANAAN, Conn.--(BUSINESS WIRE)--Bankwell Financial Group, Inc. (NASDAQ: BWFG) reported GAAP net income of $3.8 million or $0.49 per share for the second quarter of 2017, versus $2.9 million or $0.38 per share for the same period in 2016.
The Company's Board of Directors declared a $0.07 per share cash dividend, payable August 25, 2017 to shareholders of record on August 15, 2017.
Notes Bankwell Financial Group President and CEO, Christopher R. Gruseke:
“Bankwell has sustained steady momentum in all aspects of our business as we achieved a fourth consecutive quarter of record earnings. Loan demand remains robust, with gross loan fundings of $83 million for the second quarter. Meanwhile, our credit quality continues to be exceptional as nonperforming assets stood at just 0.31% of total assets.
On the deposit front, our investments in our franchise have borne fruit, as evidenced by retail deposit growth of more than 5% quarter over quarter. We have identified several promising locations within our footprint, with one branch application underway and one to two additional branch applications being contemplated.
As always, we remain steadfast in our focus on expense control and our commitment to deliver value to our shareholders. The combined efforts of our dedicated team have produced a year to date annualized ROAA of 0.90% and a year to date annualized ROAE of 10%. I thank all of my colleagues for their commitment to excellence and our loyal customers for choosing to ‘Bankwell Instead’.”
Second Quarter 2017 Highlights:
- Second quarter diluted earnings per share were $0.49, an increase of 29% compared to the second quarter of 2016.
- Second quarter total revenue (net interest income plus non-interest income) reached $14.6 million versus $12.7 million in the same period last year, a 15% increase.
- Return on average assets reached 0.88% for the quarter ended June 30, 2017 compared to 0.82% for the quarter ended June 30, 2016.
- Return on average tangible common equity reached 10.09 % in the second quarter of 2017 compared to 8.74% for the quarter ended June 30, 2016.
- The tangible book value per common share at June 30, 2017 was $19.89, a 10% increase over June 30, 2016.
- Tax equivalent net interest margin was 3.32% for the second quarter of 2017.
- The efficiency ratio was 51.2% for the second quarter of 2017 and 54.7% for the six months ended June 30, 2017.
- Total gross loans approached $1.5 billion and grew at an annualized rate of 16% during the second quarter of 2017 and 18% for the six months ended June 30, 2017.
- Total assets approached $1.8 billion and grew at an annualized rate of 20% during the second quarter of 2017 and 16% for the six months ended June 30, 2017.
- Total deposits exceeded $1.4 billion and grew at an annualized rate of 26% during the second quarter of 2017 and 19% for the six months ended June 30, 2017.
- The allowance for loan losses was $19.5 million and represents 1.31% of total loans.
- Nonperforming assets represented 0.31% of total assets as of June 30, 2017.
- Investment securities totaled $114.6 million and represent 7% of total assets.
Earnings
Net income for the quarter ended June 30, 2017 was $3.8 million, an increase of 30% compared to the quarter ended June 30, 2016. Net income for the six months ended June 30, 2017 was $7.5 million, an increase of 27% compared to the six months ended June 30, 2016. Second quarter earnings included two adjustments that collectively reduced EPS by $0.01. The adjustments related to additional income tax expense resulting from treatment of acquisition related items on prior years’ tax returns, which was partially offset by income recognized for the net effect of recording servicing assets and liabilities and related deferred fee income for various loan sales and participations sold for which servicing was retained by the Bank. The additional income tax expense of $0.3 million is reflected in the income tax expense line on the income statement and the additional net servicing income related to prior year loan sales is reflected in interest income in the pre-tax amount of $0.1 million and noninterest income in the pre-tax amount of $0.1 million on the income statement.
Revenues (net interest income plus non-interest income) for the quarter ended June 30, 2017 were $14.6 million, an increase of 15% compared to the quarter ended June 30, 2016. Revenues for the six months ended June 30, 2017 were $28.9 million, an increase of 16% compared to the six months ended June 30, 2016. Net interest income for the quarter ended June 30, 2017 was $13.6 million, an increase of 15% compared to the quarter ended June 30, 2016. Net interest income for the six months ended June 30, 2017 was $26.6 million, an increase of 14% compared to the six months ended June 30, 2016. Our strong net income, revenues and net interest income growth were fueled by continued earning asset growth.
Basic and diluted earnings per share for the quarter ended June 30, 2017 were $0.49 compared to $0.38 basic and diluted for the quarter ended June 30, 2016.
The Company’s efficiency ratios for the quarters ended June 30, 2017 and June 30, 2016 were 51.2% and 57.1%, respectively. The Company’s efficiency ratios for the six months ended June 30, 2017 and June 30, 2016 were 54.7% and 57.4%, respectively.
Noninterest Income and Expense
Noninterest income increased $145 thousand or 17% to $998 thousand for the three months ended June 30, 2017 compared to the three months ended June 30, 2016. Noninterest income increased $739 thousand or 48% to $2.3 million for the six months ended June 30, 2017 compared to the six months ended June 30, 2016. The increase in noninterest income was primarily driven by income earned from our additional purchases of Bank Owned Life Insurance, an increase in the gains and fees from the sales of loans and rental income earned from the tenants occupying the additional space in the executive headquarters building recently acquired in the fourth quarter of 2016.
Noninterest expense increased $366 thousand or 5% for the three months ended June 30, 2017 compared to the three months ended June 30, 2016. The increase was primarily driven by an increase in professional services due to an increase in fees paid in relation to strategic initiatives.
Noninterest expense increased $1.5 million or 11% for the six months ended June 30, 2017 compared to the six months ended June 30, 2016. The increase was primarily driven by an increase in occupancy and equipment expenses, salaries and employee benefits and professional services. The increase in occupancy and equipment expenses was driven by increases in IT related expenses, one time charges relating to back office consolidation activity and maintenance costs for our recently acquired headquarters building. The increase in salaries and employee benefits was driven by an increase in full time equivalent employees. Average full time equivalent employees totaled 129 at June 30, 2017 compared to 122 at June 30, 2016. The increase in professional services was driven by an increase in fees paid in relation to strategic initiatives.
Financial Condition
Assets approached $1.8 billion at June 30, 2017, an annualized increase of 16% compared to assets of $1.6 billion at December 31, 2016. This increase reflects strong organic loan growth. Total gross loans were $1.5 billion at June 30, 2017, an annualized increase of 18% compared to December 31, 2016, driven by growth in commercial real estate loans of $57.8 million and commercial business loans of $53.4 million. Deposits increased to $1.4 billion, an annualized increase of 19% over December 31, 2016.
Asset Quality
Asset quality remained exceptionally strong at June 30, 2017. Non-performing assets as a percentage of total assets was 0.31% at June 30, 2017, up from 0.20% at December 31, 2016. The allowance for loan losses at March 31, 2017 was $19.5 million, representing 1.31% of total loans.
Capital
Shareholders’ equity totaled $153.6 million as of June 30, 2017, an increase of $7.7 million compared to December 31, 2016, primarily a result of net income for the six months ended June 30, 2017 of $7.5 million. As of June 30, 2017, the tangible common equity ratio and tangible book value per share were 8.59% and $19.89, respectively.
About Bankwell Financial Group
Bankwell is a commercial bank that serves the banking and lending needs of residents and businesses throughout Fairfield and New Haven Counties, CT. For more information about this press release, interested parties may contact Christopher R. Gruseke, President and Chief Executive Officer or Penko Ivanov, Executive Vice President and Chief Financial Officer of Bankwell Financial Group at (203) 652-0166.
For more information, visit www.mybankwell.com.
This press release may contain certain forward-looking statements about the Company. Forward-looking statements include statements regarding anticipated future events and can be identified by the fact that they do not relate strictly to historical or current facts. They often include words such as “believe,” “expect,” “anticipate,” “estimate,” and “intend” or future or conditional verbs such as “will,” “would,” “should,” “could,” or “may.” Forward-looking statements, by their nature, are subject to risks and uncertainties. Certain factors that could cause actual results to differ materially from expected results include increased competitive pressures, changes in the interest rate environment, general economic conditions or conditions within the securities markets, legislative and regulatory changes that could adversely affect the business in which the Company and its subsidiaries are engaged and other risks and uncertainties disclosed from time to time in Bankwell’s Annual Report on Form 10-K for the year ended December 31, 2016, as updated by other filings with the Securities and Exchange Commission (“SEC”). Bankwell does not have any obligation to update forward-looking statements.
Non-GAAP Financial Measures
In addition to evaluating the Company's financial performance in accordance with U.S. generally accepted accounting principles ("GAAP"), management may evaluate certain non-GAAP financial measures, such as the efficiency ratio, tangible common equity and tangible book value per share. A computation and reconciliation of certain non-GAAP financial measures used for these purposes is contained in the accompanying Reconciliation of GAAP to Non-GAAP Measures table. We believe that providing certain non-GAAP financial measures provides investors with information useful in understanding our financial performance, our performance trends and financial position. For example, the Company believes that the efficiency ratio is useful in the assessment of financial performance, including non-interest expense control. The Company believes that tangible common equity and tangible book value per share is useful to evaluate the relative strength of the Company's capital position. We utilize these measures for internal planning and forecasting purposes. These non-GAAP financial measures should not be considered a substitute for GAAP basis measures and results, and we strongly encourage investors to review our consolidated financial statements in their entirety and not to rely on any single financial measure.
Annualized Data
Certain returns, yields and performance ratios are presented on an “annualized” basis. This is done for analytical and decision-making purposes to better discern underlying performance trends when compared to full-year or year-over year amounts.
| BANKWELL FINANCIAL GROUP, INC. | |||||||||||||
| CONSOLIDATED BALANCE SHEETS (unaudited) | |||||||||||||
| (Dollars in thousands, except share data) | |||||||||||||
| June 30, | March 31, | December 31, | June 30, | ||||||||||
| 2017 | 2017 | 2016 | 2016 | ||||||||||
| Assets | |||||||||||||
| Cash and due from banks | $ | 84,802 | $ | 63,675 | $ | 96,026 | $ | 92,745 | |||||
| Federal funds sold | 1,185 | 10,280 | 329 | 1,932 | |||||||||
| Cash and cash equivalents | 85,987 | 73,955 | 96,355 | 94,677 | |||||||||
| Available for sale investment securities, at fair value | 90,951 | 87,434 | 87,751 | 83,837 | |||||||||
| Held to maturity investment securities, at amortized cost | 23,615 | 16,808 | 16,859 | 16,959 | |||||||||
| Loans held for sale | - | - | 254 | - | |||||||||
| Loans receivable (net of allowance for loan losses of $19,536, $18,511, | |||||||||||||
| $17,982 and $16,100 at June 30, 2017, March 31, 2017, December 31, 2016 | |||||||||||||
| and June 30, 2016, respectively) | 1,463,240 | 1,406,407 | 1,343,895 | 1,256,949 | |||||||||
| Foreclosed real estate | 222 | 272 | 272 | 492 | |||||||||
| Accrued interest receivable | 5,239 | 5,180 | 4,958 | 4,708 | |||||||||
| Federal Home Loan Bank stock, at cost | 8,033 | 8,033 | 7,943 | 7,393 | |||||||||
| Premises and equipment, net | 17,366 | 17,618 | 17,835 | 10,659 | |||||||||
| Bank-owned life insurance | 39,034 | 38,740 | 33,448 | 24,103 | |||||||||
| Goodwill | 2,589 | 2,589 | 2,589 | 2,589 | |||||||||
| Other intangible assets | 438 | 469 | 501 | 572 | |||||||||
| Deferred income taxes, net | 8,957 | 8,954 | 9,085 | 9,487 | |||||||||
| Other assets | 10,133 | 5,783 | 7,174 | 3,695 | |||||||||
| Total assets | $ | 1,755,804 | $ | 1,672,242 | $ | 1,628,919 | $ | 1,516,120 | |||||
| Liabilities & Shareholders' Equity | |||||||||||||
| Liabilities | |||||||||||||
| Deposits | |||||||||||||
| Noninterest-bearing | $ | 176,495 | $ | 170,572 | $ | 187,593 | $ | 178,917 | |||||
| Interest-bearing | 1,237,790 | 1,156,888 | 1,101,444 | 1,001,674 | |||||||||
| Total deposits | 1,414,285 | 1,327,460 | 1,289,037 | 1,180,591 | |||||||||
| Advances from the Federal Home Loan Bank | 150,000 | 160,000 | 160,000 | 165,000 | |||||||||
| Subordinated debentures | 25,077 | 25,064 | 25,051 | 25,025 | |||||||||
| Accrued expenses and other liabilities | 12,865 | 10,046 | 8,936 | 8,382 | |||||||||
| Total liabilities | 1,602,227 | 1,522,570 | 1,483,024 | 1,378,998 | |||||||||
| Shareholders' equity | |||||||||||||
| Common stock, no par value; 10,000,000 shares authorized, 7,673,850, 7,638,706, | |||||||||||||
| 7,620,663 and 7,544,458 shares issued and outstanding at June 30, 2017, | |||||||||||||
| March 31, 2017, December 31, 2016 and June 30, 2016, respectively | 116,502 | 115,823 | 115,353 | 113,309 | |||||||||
| Retained earnings | 36,053 | 32,820 | 29,652 | 24,097 | |||||||||
| Accumulated other comprehensive income (loss) | 1,022 | 1,029 | 890 | (284 | ) | ||||||||
| Total shareholders' equity | 153,577 | 149,672 | 145,895 | 137,122 | |||||||||
| Total liabilities and shareholders' equity | $ | 1,755,804 | $ | 1,672,242 | $ | 1,628,919 | $ | 1,516,120 | |||||
| BANKWELL FINANCIAL GROUP, INC. | |||||||||||||||||||
| CONSOLIDATED STATEMENTS OF INCOME (unaudited) | |||||||||||||||||||
| (Dollars in thousands, except per share data) | |||||||||||||||||||
|
For the Quarter Ended |
For the Six Months Ended |
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| June 30, | March 31, | December 31, | June 30, | June 30, | June 30, | ||||||||||||||
| 2017 | 2017 | 2016 | 2016 | 2017 | 2016 | ||||||||||||||
| Interest and dividend income | |||||||||||||||||||
| Interest and fees on loans | $ | 16,660 | $ | 15,513 | $ | 15,910 | $ | 13,970 | $ | 32,173 | $ | 27,253 | |||||||
| Interest and dividends on securities | 880 | 809 | 657 | 711 | 1,689 | 1,395 | |||||||||||||
| Interest on cash and cash equivalents | 148 | 114 | 75 | 30 | 262 | 67 | |||||||||||||
| Total interest income | 17,688 | 16,436 | 16,642 | 14,711 | 34,124 | 28,715 | |||||||||||||
| Interest expense | |||||||||||||||||||
| Interest expense on deposits | 3,095 | 2,581 | 2,438 | 1,962 | 5,676 | 3,702 | |||||||||||||
| Interest on borrowings | 952 | 907 | 916 | 870 | 1,859 | 1,736 | |||||||||||||
|
Total interest expense |
4,047 | 3,488 | 3,354 | 2,832 | 7,535 | 5,438 | |||||||||||||
| Net interest income | 13,641 | 12,948 | 13,288 | 11,879 | 26,589 | 23,277 | |||||||||||||
| Provision for loan losses | 895 | 543 | 748 | 1,301 | 1,438 | 1,947 | |||||||||||||
| Net interest income after provision for loan losses | 12,746 | 12,405 | 12,540 | 10,578 | 25,151 | 21,330 | |||||||||||||
| Noninterest income | |||||||||||||||||||
| Bank owned life insurance | 295 | 291 | 171 | 174 | 586 | 348 | |||||||||||||
| Service charges and fees | 261 | 240 | 242 | 235 | 501 | 480 | |||||||||||||
| Gains and fees from sales of loans | 199 | 324 | 79 | 114 | 523 | 224 | |||||||||||||
| Gain on sale of foreclosed real estate, net | - | - | - | 128 | - | 128 | |||||||||||||
| Net gain (loss) on sale of available for sale securities | - | 165 | (207 | ) | 92 | 165 | 92 | ||||||||||||
| Other | 243 | 246 | 116 | 110 | 489 | 253 | |||||||||||||
| Total noninterest income | 998 | 1,266 | 401 | 853 | 2,264 | 1,525 | |||||||||||||
| Noninterest expense | |||||||||||||||||||
| Salaries and employee benefits | 3,800 | 3,929 | 4,331 | 3,747 | 7,729 | 7,484 | |||||||||||||
| Occupancy and equipment | 1,439 | 1,692 | 1,576 | 1,392 | 3,131 | 2,800 | |||||||||||||
| Professional services | 523 | 412 | 397 | 370 | 935 | 736 | |||||||||||||
| Data processing | 401 | 445 | 402 | 377 | 846 | 784 | |||||||||||||
| Marketing | 311 | 266 | 304 | 263 | 577 | 402 | |||||||||||||
| FDIC insurance | 243 | 383 | 146 | 168 | 626 | 337 | |||||||||||||
| Director fees | 243 | 233 | 223 | 210 | 476 | 439 | |||||||||||||
| Foreclosed real estate | 60 | 7 | 8 | 30 | 67 | 102 | |||||||||||||
| Amortization of intangibles | 31 | 31 | 32 | 40 | 62 | 80 | |||||||||||||
| Other | 530 | 836 | 349 | 618 | 1,366 | 1,131 | |||||||||||||
| Total noninterest expense | 7,581 | 8,234 | 7,768 | 7,215 | 15,815 | 14,295 | |||||||||||||
| Income before income tax expense | 6,163 | 5,437 | 5,173 | 4,216 | 11,600 | 8,560 | |||||||||||||
| Income tax expense | 2,394 | 1,735 | 1,850 | 1,320 | 4,129 | 2,673 | |||||||||||||
| Net income | $ | 3,769 | $ | 3,702 | $ | 3,323 | $ | 2,896 | $ | 7,471 | $ | 5,887 | |||||||
| Earnings Per Common Share: | |||||||||||||||||||
| Basic | $ | 0.49 | $ | 0.49 | $ | 0.44 | $ | 0.38 | $ | 0.98 | $ | 0.78 | |||||||
| Diluted | 0.49 | 0.48 | 0.43 | 0.38 | 0.97 | 0.78 | |||||||||||||
| Weighted Average Common Shares Outstanding: | |||||||||||||||||||
| Basic | 7,550,734 | 7,525,268 | 7,418,820 | 7,387,712 | 7,538,069 | 7,383,965 | |||||||||||||
| Diluted | 7,645,930 | 7,632,123 | 7,560,319 | 7,467,954 | 7,638,350 | 7,446,456 | |||||||||||||
| Dividends per common share | $ | 0.07 | $ | 0.07 | $ | 0.07 | $ | 0.05 | $ | 0.14 | $ | 0.10 | |||||||
| BANKWELL FINANCIAL GROUP, INC. | ||||||||||||||||||||||
| CONSOLIDATED FINANCIAL HIGHLIGHTS (unaudited) | ||||||||||||||||||||||
| (Dollars in thousands, except per share data) | ||||||||||||||||||||||
| For the Quarter Ended | For the Six Months Ended | |||||||||||||||||||||
| June 30, | March 31, | December 31, | June 30, | June 30, | June 30, | |||||||||||||||||
| 2017 | 2017 | 2016 | 2016 | 2017 | 2016 | |||||||||||||||||
| Performance ratios: | ||||||||||||||||||||||
| Return on average assets | 0.88% | 0.93% | 0.84% | 0.82% | 0.90% | 0.85% | ||||||||||||||||
| Return on average stockholders' equity | 9.89% | 10.12% | 9.23% | 8.54% | 10.00% | 8.77% | ||||||||||||||||
| Return on average tangible common equity | 10.09% | 10.33% | 9.44% | 8.74% | 10.21% | 8.98% | ||||||||||||||||
| Net interest margin | 3.32% | 3.35% | 3.55% | 3.50% | 3.34% | 3.52% | ||||||||||||||||
| Efficiency ratio (1) | 51.2% | 58.3% | 55.6% | 57.1% | 54.7% | 57.4% | ||||||||||||||||
| Net loan charge-offs (recoveries) as a % of average loans | (0.01) |
% |
0.00 |
% |
0.00 |
% |
0.00 | % | (0.01) |
% |
0.00 |
% |
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| As of | ||||||||||||||||||||||
|
June 30,
2017 |
March 31,
2017 |
December 31,
2016 |
June 30,
2016 |
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| Capital ratios: | ||||||||||||||||||||||
| Total Common Equity Tier 1 Capital to Risk-Weighted Assets (2) | 10.91% | 11.16% | 11.59% | 11.76% | ||||||||||||||||||
| Total Capital to Risk-Weighted Assets (2) | 12.16% | 12.41% | 12.85% | 13.01% | ||||||||||||||||||
| Tier I Capital to Risk-Weighted Assets (2) | 10.91% | 11.16% | 11.59% | 11.76% | ||||||||||||||||||
| Tier I Capital to Average Assets (2) | 9.75% | 10.06% | 10.10% | 10.59% | ||||||||||||||||||
| Tangible common equity to tangible assets | 8.59% | 8.78% | 8.78% | 8.85% | ||||||||||||||||||
| Tangible book value per common share (3) | $ | 19.89 | $ | 19.44 | $ | 18.98 | $ | 18.12 | ||||||||||||||
| Asset quality: | ||||||||||||||||||||||
| Nonaccrual loans | $ | 5,303 | $ | 4,434 | $ | 2,937 | $ | 3,609 | ||||||||||||||
| Other real estate owned | 222 | 272 | 272 | 492 | ||||||||||||||||||
| Total non-performing assets | $ | 5,525 | $ | 4,706 | $ | 3,209 | $ | 4,101 | ||||||||||||||
| Nonperforming loans as a % of total loans | 0.36% | 0.31% | 0.22% | 0.28% | ||||||||||||||||||
|
|
|
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| Nonperforming assets as a % of total assets | 0.31% | 0.28% | 0.20% | 0.27% | ||||||||||||||||||
| Allowance for loan losses as a % of total loans | 1.31% | 1.30% | 1.32% | 1.26% | ||||||||||||||||||
| Allowance for loan losses as a % of nonperforming loans | 368.40% | 417.48% | 612.26% | 446.11% | ||||||||||||||||||
| (1) Efficiency ratio is defined as noninterest expense, less merger and acquisition related expenses, other real estate owned expenses and amortization of intangible assets, divided by our operating revenue, which is equal to net interest income plus non-interest income excluding gains and losses on sales of securities and gains and losses on other real estate owned. In our judgment, the adjustments made to operating revenue allow investors and analysts to better assess our operating expenses in relation to our core operating revenue by removing the volatility that is associated with certain one-time items and other discrete items that are unrelated to our core business. | |
| (2) Represents Bank ratios. Current period capital ratios are preliminary subject to finalization of the FDIC Call Report. | |
| (3) Excludes unvested restricted shares of 103,220, 98,176, 96,594 and 152,090 as of June 30, 2017, March 31, 2017, December 31, 2016 and June 30, 2016, respectively. | |
| BANKWELL FINANCIAL GROUP, INC. | |||||||||||||||
| LOAN & DEPOSIT PORTFOLIO (unaudited) | |||||||||||||||
| (Dollars in thousands) | |||||||||||||||
| June 30, | March 31, | December 31, | Current QTD | YTD | |||||||||||
| Period End Loan Composition | 2017 | 2017 | 2016 | % Change | % Change | ||||||||||
| Residential Real Estate | $ | 181,005 | $ | 181,034 | $ | 181,310 | 0.0 | % | (0.2 | %) | |||||
| Commercial Real Estate | 903,080 | 886,933 | 845,322 | 1.8 | % | 6.8 | % | ||||||||
| Construction | 117,348 | 107,766 | 107,441 | 8.9 | % | 9.2 | % | ||||||||
| Home equity | 14,587 | 14,108 | 14,419 | 3.4 | % | 1.2 | % | ||||||||
| Total Real Estate Loans | 1,216,020 | 1,189,841 | 1,148,492 | 2.2 | % | 5.9 | % | ||||||||
| Commercial Business | 269,311 | 237,827 | 215,914 | 13.2 | % | 24.7 | % | ||||||||
| Consumer | 957 | 1,063 | 1,533 | (10.0 | %) | (37.6 | %) | ||||||||
| Total Loans | $ | 1,486,288 | $ | 1,428,731 | $ | 1,365,939 | 4.0 | % | 8.8 | % | |||||
| June 30, | March 31, | December 31, | Current QTD | YTD | |||||||||||
| Period End Deposit Composition | 2017 | 2017 | 2016 | % Change | % Change | ||||||||||
| Noninterest-bearing demand | $ | 176,495 | $ | 170,572 | $ | 187,593 | 3.5 | % | (5.9 | %) | |||||
| NOW | 67,938 | 57,077 | 53,851 | 19.0 | % | 26.2 | % | ||||||||
| Money Market | 401,107 | 367,241 | 349,131 | 9.2 | % | 14.9 | % | ||||||||
| Savings | 113,449 | 117,395 | 96,601 | (3.4 | %) | 17.4 | % | ||||||||
| Time | 655,296 | 615,175 | 601,861 | 6.5 | % | 8.9 | % | ||||||||
| Total Deposits | $ | 1,414,285 | $ | 1,327,460 | $ | 1,289,037 | 6.5 | % | 9.7 | % | |||||
| BANKWELL FINANCIAL GROUP, INC. | |||||||||||||
| NONINTEREST INCOME & EXPENSE - QTD (unaudited) | |||||||||||||
| (Dollars in thousands) | |||||||||||||
| For the Quarter Ended | |||||||||||||
| Noninterest income | June 30, | March 31, | June 30, | Jun 17 vs. Mar 17 | Jun 17 vs. Jun 16 | ||||||||
| 2017 | 2017 | 2016 | % Change | % Change | |||||||||
| Bank owned life insurance | $ | 295 | $ | 291 | $ | 174 | 1.4% | 69.5% | |||||
| Service charges and fees | 261 | 240 | 235 | 8.8% | 11.1% | ||||||||
| Gains and fees from sales of loans | 199 | 324 | 114 | (38.6%) | 74.6% | ||||||||
| Gain on sale of foreclosed real estate, net | - | - | 128 | 0.0% | (100.0%) | ||||||||
| Net gain (loss) on sale of available for sale securities | - | 165 | 92 | (100.0%) | (100.0%) | ||||||||
| Other | 243 | 246 | 110 | (1.2%) | 120.9% | ||||||||
| Total noninterest income | $ | 998 | $ | 1,266 | $ | 853 | (21.2%) | 17.0% | |||||
| For the Quarter Ended | |||||||||||||
| Noninterest expense | June 30, | March 31, | June 30, | Jun 17 vs. Mar 17 | Jun 17 vs. Jun 16 | ||||||||
| 2017 | 2017 | 2016 | % Change | % Change | |||||||||
| Salaries and employee benefits | $ | 3,800 | $ | 3,929 | $ | 3,747 | (3.3%) | 1.4% | |||||
| Occupancy and equipment | 1,439 | 1,692 | 1,392 | (15.0%) | 3.4% | ||||||||
| Professional services | 523 | 412 | 370 | 26.9% | 41.4% | ||||||||
| Data processing | 401 | 445 | 377 | (9.9%) | 6.4% | ||||||||
| Marketing | 311 | 266 | 263 | 16.9% | 18.3% | ||||||||
| FDIC insurance | 243 | 383 | 168 | (36.6%) | 44.6% | ||||||||
| Director fees | 243 | 233 | 210 | 4.3% | 15.7% | ||||||||
| Foreclosed real estate | 60 | 7 | 30 | 757.1% | 100.0% | ||||||||
| Amortization of intangibles | 31 | 31 | 40 | 0.0% | (22.5%) | ||||||||
| Other | 530 | 836 | 618 | (36.6%) | (14.2%) | ||||||||
| Total noninterest expense | $ | 7,581 | $ | 8,234 | $ | 7,215 | (7.9%) | 5.1% | |||||
| BANKWELL FINANCIAL GROUP, INC. | ||||||||
| NONINTEREST INCOME & EXPENSE - YTD (unaudited) | ||||||||
| (Dollars in thousands) | ||||||||
| For the Six Months Ended | ||||||||
| Noninterest income | June 30, | June 30, | Jun 17 vs. Jun 16 | |||||
| 2017 | 2016 | % Change | ||||||
| Bank owned life insurance | $ | 586 | $ | 348 | 68.4% | |||
| Gains and fees from sales of loans | 523 | 224 | 133.5% | |||||
| Service charges and fees | 501 | 480 | 4.4% | |||||
| Gain on sale of foreclosed real estate, net | - | 128 | (100.0%) | |||||
| Net gain on sale of available for sale securities | 165 | 92 | 79.3% | |||||
| Other | 489 | 253 | 93.3% | |||||
| Total noninterest income | $ | 2,264 | $ | 1,525 | 48.5% | |||
| For the Six Months Ended | ||||||||
| Noninterest expense | June 30, | June 30, | Jun 17 vs. Jun 16 | |||||
| 2017 | 2016 | % Change | ||||||
| Salaries and employee benefits | $ | 7,729 | $ | 7,484 | 3.3% | |||
| Occupancy and equipment | 3,131 | 2,800 | 11.8% | |||||
| Professional services | 935 | 736 | 27.0% | |||||
| Data processing | 846 | 784 | 7.9% | |||||
| FDIC insurance | 626 | 337 | 85.8% | |||||
| Marketing | 577 | 402 | 43.5% | |||||
| Director fees | 476 | 439 | 8.4% | |||||
| Foreclosed real estate | 67 | 102 | (34.3%) | |||||
| Amortization of intangibles | 62 | 80 | (22.5%) | |||||
| Other | 1,366 | 1,131 | 20.8% | |||||
| Total noninterest expense | $ | 15,815 | $ | 14,295 | 10.6% | |||
| BANKWELL FINANCIAL GROUP, INC. | ||||||||||||||||||
| RECONCILIATION OF GAAP TO NON-GAAP MEASURES (unaudited) | ||||||||||||||||||
| (Dollars in thousands, except share data) | ||||||||||||||||||
| As of | ||||||||||||||||||
| Computation of Tangible Common Equity to Tangible Assets | 6/30/2017 | 3/31/2017 | 12/31/2016 | 06/30/2016 | ||||||||||||||
| Total Equity | $ | 153,577 | $ | 149,672 | $ | 145,895 | $ | 137,122 | ||||||||||
| Less: | ||||||||||||||||||
| Goodwill | 2,589 | 2,589 | 2,589 | 2,589 | ||||||||||||||
| Other intangibles | 438 | 469 | 501 | 572 | ||||||||||||||
| Tangible Common Equity | $ | 150,550 | $ | 146,614 | $ | 142,805 | $ | 133,961 | ||||||||||
| Total Assets | $ | 1,755,804 | $ | 1,672,242 | $ | 1,628,919 | $ | 1,516,120 | ||||||||||
| Less: | ||||||||||||||||||
| Goodwill | 2,589 | 2,589 | 2,589 | 2,589 | ||||||||||||||
| Other intangibles | 438 | 469 | 501 | 572 | ||||||||||||||
| Tangible Assets | $ | 1,752,777 | $ | 1,669,184 | $ | 1,625,829 | $ | 1,512,959 | ||||||||||
| Tangible Common Equity to Tangible Assets | 8.59% | 8.78% | 8.78% | 8.85% | ||||||||||||||
| As of | ||||||||||||||||||
| Computation of Tangible Book Value per Common Share | 6/30/2017 | 3/31/2017 | 12/31/2016 | 06/30/2016 | ||||||||||||||
| Total shareholders' equity | $ | 153,577 | $ | 149,672 | $ | 145,895 | $ | 137,122 | ||||||||||
| Less: | ||||||||||||||||||
| Preferred stock | - | - | - | - | ||||||||||||||
| Common shareholders' equity | 153,577 | 149,672 | 145,895 | 137,122 | ||||||||||||||
| Less: | ||||||||||||||||||
| Goodwill | 2,589 | 2,589 | 2,589 | 2,589 | ||||||||||||||
| Other intangibles | 438 | 469 | 501 | 572 | ||||||||||||||
| Tangible common shareholders' equity | 150,550 | 146,614 | 142,805 | 133,961 | ||||||||||||||
| Common shares issued | 7,673,850 | 7,638,706 | 7,620,663 | 7,544,458 | ||||||||||||||
| Less: | ||||||||||||||||||
| Shares of unvested restricted stock | 103,220 | 98,176 | 96,594 | 152,090 | ||||||||||||||
| Common shares outstanding | 7,570,630 | 7,540,530 | 7,524,069 | 7,392,368 | ||||||||||||||
| Book value per share | $ | 20.29 | $ | 19.85 | $ | 19.39 | $ | 18.55 | ||||||||||
| Less: | ||||||||||||||||||
| Effects of intangible assets | $ | 0.40 | $ | 0.41 | $ | 0.41 | $ | 0.43 | ||||||||||
| Tangible Book Value per Common Share | $ | 19.89 | $ | 19.44 | $ | 18.98 | $ | 18.12 | ||||||||||
| BANKWELL FINANCIAL GROUP, INC. | ||||||||||||||||||
| RECONCILIATION OF GAAP TO NON-GAAP MEASURES (unaudited) - Continued | ||||||||||||||||||
|
(Dollars in thousands, except share data) |
||||||||||||||||||
| For the Quarter Ended | For the Six Months Ended | |||||||||||||||||
| Computation of Efficiency Ratio | 6/30/2017 | 3/31/2017 | 12/31/2016 | 06/30/2016 | 06/30/2017 | 06/30/2016 | ||||||||||||
| Noninterest expense | $ | 7,581 | $ | 8,234 | $ | 7,768 | $ | 7,215 | $ | 15,815 | $ | 14,295 | ||||||
| Less: | ||||||||||||||||||
| Amortization of intangible assets | 31 | 31 | 32 | 40 | 62 | 80 | ||||||||||||
| Foreclosed real estate expenses | 60 | 7 | 8 | 30 | 67 | 102 | ||||||||||||
| Adjusted noninterest expense | $ | 7,490 | $ | 8,196 | $ | 7,728 | $ | 7,145 | $ | 15,686 | $ | 14,113 | ||||||
| Net interest income | $ | 13,641 | $ | 12,948 | $ | 13,288 | $ | 11,879 | $ | 26,589 | $ | 23,277 | ||||||
| Noninterest income | 998 | 1,266 | 401 | 853 | 2,264 | 1,525 | ||||||||||||
| Less: | ||||||||||||||||||
| Gains (losses) on sales of securities | - | 165 | (207) | 92 | 165 | 92 | ||||||||||||
| Gains on sale of foreclosed real estate | - | - | - | 128 | - | 128 | ||||||||||||
| Adjusted operating revenue | $ | 14,639 | $ | 14,049 | $ | 13,896 | $ | 12,512 | $ | 28,688 | $ | 24,582 | ||||||
| Efficiency ratio | 51.2% | 58.3% | 55.6% | 57.1% | 54.7% | 57.4% | ||||||||||||
| For the Quarter Ended | For the Six Months Ended | |||||||||||||||||
| Computation of Return on Average Tangible Common Equity | 6/30/2017 | 3/31/2017 | 12/31/2016 | 06/30/2016 | 06/30/2017 | 06/30/2016 | ||||||||||||
| Net Income Attributable to Common Shareholders | $ | 3,769 | $ | 3,702 | $ | 3,323 | $ | 2,896 | $ | 7,471 | $ | 5,887 | ||||||
| Total average shareholders' equity | 152,898 | 148,349 | 143,152 | 136,389 | 150,629 | 134,933 | ||||||||||||
| Less: | ||||||||||||||||||
| Goodwill | 2,589 | 2,589 | 2,589 | 2,589 | 2,589 | 2,589 | ||||||||||||
| Other intangibles | 438 | 469 | 501 | 572 | 438 | 572 | ||||||||||||
| Average tangible common equity | 149,871 | 145,291 | 140,062 | 133,228 | 147,602 | 131,772 | ||||||||||||
| Annualized Return on Average Tangible Common Equity | 10.09% | 10.33% | 9.44% | 8.74% | 10.21% | 8.98% | ||||||||||||
| BANKWELL FINANCIAL GROUP, INC. | ||||||||||||||||
| NET INTEREST MARGIN ANALYSIS ON A FULLY TAX EQUIVALENT BASIS | ||||||||||||||||
| (Dollars in thousands) | ||||||||||||||||
| For the Quarter Ended | ||||||||||||||||
| June 30, 2017 | June 30, 2016 | |||||||||||||||
| Average | Yield/ | Average | Yield/ | |||||||||||||
| Balance | Interest | Rate | Balance | Interest | Rate | |||||||||||
| Assets: | ||||||||||||||||
| Cash and Fed funds sold | $ | 86,543 | $ | 148 | 0.69% | $ | 30,728 | $ | 28 | 0.37% | ||||||
| Securities (1) | 105,850 | 947 | 3.58% | 105,886 | 795 | 3.00% | ||||||||||
| Loans: | ||||||||||||||||
| Commercial real estate | 899,344 | 10,230 | 4.50% | 761,796 | 8,772 | 4.56% | ||||||||||
| Residential real estate | 181,810 | 1,648 | 3.63% | 180,649 | 1,612 | 3.57% | ||||||||||
| Construction (2) | 109,681 | 1,299 | 4.69% | 96,122 | 1,099 | 4.52% | ||||||||||
| Commercial business | 251,981 | 3,304 | 5.19% | 173,235 | 2,309 | 5.27% | ||||||||||
| Home equity | 14,582 | 168 | 4.62% | 15,313 | 155 | 4.08% | ||||||||||
| Consumer | 1,320 | 11 | 3.21% | 1,918 | 24 | 5.10% | ||||||||||
| Total loans | 1,458,718 | 16,660 | 4.52% | 1,229,033 | 13,971 | 4.50% | ||||||||||
| Federal Home Loan Bank stock | 8,033 | 81 | 4.02% | 7,556 | 58 | 3.09% | ||||||||||
| Total earning assets | 1,659,144 | 17,836 | 4.25% | 1,373,203 | 14,852 | 4.28% | ||||||||||
| Other assets | 61,588 | 53,637 | ||||||||||||||
| Total assets | $ | 1,720,732 | $ | 1,426,840 | ||||||||||||
| Liabilities and shareholders' equity: | ||||||||||||||||
| Interest-bearing liabilities: | ||||||||||||||||
| NOW | $ | 61,002 | 20 | 0.13% | $ | 57,123 | 32 | 0.23% | ||||||||
| Money market | 383,919 | 771 | 0.81% | 321,354 | 449 | 0.56% | ||||||||||
| Savings | 113,736 | 217 | 0.76% | 69,069 | 66 | 0.38% | ||||||||||
| Time | 644,222 | 2,088 | 1.30% | 511,086 | 1,415 | 1.11% | ||||||||||
| Total interest-bearing deposits | 1,202,879 | 3,096 | 1.03% | 958,632 | 1,962 | 0.82% | ||||||||||
| Borrowed Money | 184,958 | 952 | 2.04% | 157,732 | 870 | 2.18% | ||||||||||
| Total interest-bearing liabilities | 1,387,837 | $ | 4,048 | 1.17% | 1,116,364 | $ | 2,832 | 1.02% | ||||||||
| Noninterest-bearing deposits | 167,111 | 167,190 | ||||||||||||||
| Other liabilities | 12,886 | 6,897 | ||||||||||||||
| Total liabilities | 1,567,834 | 1,290,451 | ||||||||||||||
| Shareholders' equity | 152,898 | 136,389 | ||||||||||||||
| Total liabilities and shareholders' equity | $ | 1,720,732 | $ | 1,426,840 | ||||||||||||
| Net interest income (3) | $ | 13,788 | $ | 12,020 | ||||||||||||
| Interest rate spread | 3.08% | 3.26% | ||||||||||||||
| Net interest margin (4) | 3.32% | 3.50% | ||||||||||||||
| (1) Average balances and yields for securities are based on amortized cost. |
| (2) Includes commercial and residential real estate construction. |
| (3) The adjustment for securities and loans taxable equivalency amounted to $147 thousand and $141 thousand, respectively for the three months ended June 30, 2017 and 2016. |
| (4) Net interest income as a percentage of earning assets. |
| BANKWELL FINANCIAL GROUP, INC. | ||||||||||||||||
| NET INTEREST MARGIN ANALYSIS ON A FULLY TAX EQUIVALENT BASIS | ||||||||||||||||
| (Dollars in thousands) | ||||||||||||||||
| For the Six Months Ended | ||||||||||||||||
| June 30, 2017 | June 30, 2016 | |||||||||||||||
| Average | Yield/ | Average | Yield/ | |||||||||||||
| Balance | Interest | Rate | Balance | Interest | Rate | |||||||||||
| Assets: | ||||||||||||||||
| Cash and Fed funds sold | $ | 77,440 | $ | 262 | 0.68% | $ | 31,704 | $ | 64 | 0.41% | ||||||
| Securities (1) | 103,852 | 1,808 | 3.48% | 103,939 | 1,559 | 3.00% | ||||||||||
| Loans: | ||||||||||||||||
| Commercial real estate | 877,078 | 19,914 | 4.52% | 737,924 | 17,122 | 4.59% | ||||||||||
| Residential real estate | 180,747 | 3,238 | 3.58% | 178,998 | 3,208 | 3.58% | ||||||||||
| Construction (2) | 107,515 | 2,548 | 4.71% | 91,305 | 2,067 | 4.48% | ||||||||||
| Commercial business | 240,477 | 6,131 | 5.07% | 169,639 | 4,499 | 5.25% | ||||||||||
| Home equity | 14,114 | 318 | 4.54% | 15,458 | 312 | 4.05% | ||||||||||
| Consumer | 1,484 | 25 | 3.40% | 1,738 | 21 | 2.44% | ||||||||||
| Total loans | 1,421,415 | 32,174 | 4.50% | 1,195,062 | 27,229 | 4.51% | ||||||||||
| Federal Home Loan Bank stock | 8,027 | 159 | 3.97% | 7,058 | 116 | 3.28% | ||||||||||
| Total earning assets | 1,610,734 | 34,403 | 4.25% | 1,337,763 | 28,968 | 4.28% | ||||||||||
| Other assets | 60,633 | 54,403 | ||||||||||||||
| Total assets | $ | 1,671,367 | $ | 1,392,166 | ||||||||||||
| Liabilities and shareholders' equity: | ||||||||||||||||
| Interest-bearing liabilities: | ||||||||||||||||
| NOW | $ | 57,816 | 46 | 0.16% | $ | 56,855 | 70 | 0.25% | ||||||||
| Money market | 364,048 | 1,337 | 0.74% | 313,727 | 847 | 0.54% | ||||||||||
| Savings | 112,372 | 402 | 0.72% | 75,565 | 151 | 0.40% | ||||||||||
| Time | 619,950 | 3,892 | 1.27% | 482,715 | 2,634 | 1.10% | ||||||||||
| Total interest-bearing deposits | 1,154,186 | 5,677 | 0.99% | 928,862 | 3,702 | 0.80% | ||||||||||
| Borrowed Money | 183,514 | 1,858 | 2.01% | 151,604 | 1,736 | 2.26% | ||||||||||
| Total interest-bearing liabilities | 1,337,700 | $ | 7,535 | 1.14% | 1,080,466 | $ | 5,438 | 1.01% | ||||||||
| Noninterest-bearing deposits | 170,886 | 169,853 | ||||||||||||||
| Other liabilities | 12,152 | 6,914 | ||||||||||||||
| Total liabilities | 1,520,738 | 1,257,233 | ||||||||||||||
| Shareholders' equity | 150,629 | 134,933 | ||||||||||||||
| Total liabilities and shareholders' equity | $ | 1,671,367 | $ | 1,392,166 | ||||||||||||
| Net interest income (3) | $ | 26,868 | $ | 23,530 | ||||||||||||
| Interest rate spread | 3.11% | 3.27% | ||||||||||||||
| Net interest margin (4) | 3.34% | 3.52% | ||||||||||||||
| (1) Average balances and yields for securities are based on amortized cost. |
| (2) Includes commercial and residential real estate construction. |
| (3) The adjustment for securities and loans taxable equivalency amounted to $279 thousand and $253 thousand, respectively for the six months ended June 30, 2017, and 2016. |
| (4) Net interest income as a percentage of earning assets. |
