Press Release

Brookline Bancorp Announces Second Quarter Results

Company Release - 7/22/2020

Net Income of $19.6 million, EPS of $0.25

Announces $0.115 Dividend per Share

BOSTON, July 22, 2020 (GLOBE NEWSWIRE) -- Brookline Bancorp, Inc. (NASDAQ: BRKL) (the “Company”) today announced net income of $19.6 million, or $0.25 per basic and diluted share, for the second quarter of 2020, compared to net loss of $(17.3) million, or $(0.22) per basic and diluted share, for the first quarter of 2020, and net income of $20.5 million, or $0.26 per basic and diluted share, for the second quarter of 2019.

Paul Perrault, President and Chief Executive Officer of the Company noted, “The continued strength of our Company’s core operations is reflected in this quarter’s earnings.  While we remain vigilant as we look to the future, the business lines that are fundamental to our success continue to operate effectively in these challenging times.”

BALANCE SHEET

Total assets at June 30, 2020 increased $608.1 million to $9.1 billion from $8.5 billion at March 31, 2020, and increased $1.4 billion from $7.6 billion at June 30, 2019. At June 30, 2020, total loans and leases were $7.4 billion, representing an increase of $585.2 million from March 31, 2020, and an increase of $902.4 million from June 30, 2019, primarily driven by loans originated under the Small Business Administration's Paycheck Protection Program ("PPP"). The Company funded $565.8 million of PPP loans in the second quarter of 2020.

Total investment securities at June 30, 2020 increased $92.4 million to $856.5 million, as compared to $764.1 million at March 31, 2020, and increased approximately $265.7 million from $590.8 million at June 30, 2019. Total cash and cash equivalents at June 30, 2020 decreased $85.9 million to $254.9 million, as compared to $340.8 million at March 31, 2020, and increased $162.1 million from $92.8 million at June 30, 2019. As of June 30, 2020, total investment securities and total cash and cash equivalents represented 12.3 percent of total assets as compared to 13.1 percent and 9.0 percent as of March 31, 2020 and June 30, 2019, respectively.

Total deposits at June 30, 2020 increased $550.3 million to $6.4 billion from $5.9 billion at March 31, 2020 and increased $817.7 million from $5.6 billion at June 30, 2019.

Total borrowed funds at June 30, 2020 increased $114.9 million to $1.4 billion from $1.3 billion at March 31, 2020 and increased $475.9 million from $930.8 million at June 30, 2019.

The ratio of stockholders’ equity to total assets was 10.21 percent at June 30, 2020, as compared to 10.78 percent at March 31, 2020, and 12.03 percent at June 30, 2019. The ratio of tangible stockholders’ equity to tangible assets was 8.56 percent at June 30, 2020, as compared to 9.02 percent at March 31, 2020, and 10.08 percent at June 30, 2019. Tangible book value per share increased $0.18 from $9.49 at March 31, 2020 to $9.67 at June 30, 2020, compared to $9.45 at June 30, 2019.

NET INTEREST INCOME

Net interest income increased $2.6 million to $64.3 million during the second quarter of 2020 from $61.7 million at the quarter ended March 31, 2020. The net interest margin decreased 22 basis points to 3.09 percent for the three months ended June 30, 2020.

NON-INTEREST INCOME

Total non-interest income for the quarter ended June 30, 2020 decreased $3.1 million to $6.2 million from $9.3 million for the quarter ended March 31, 2020. The decrease was primarily driven by decreases of $0.5 million in deposit fees, $0.7 million in loan level derivative income, net, $0.7 million in gain on investment securities, net and $1.2 million in other non-interest income.

PROVISION FOR CREDIT LOSSES

On January 1, 2020, the Company adopted ASU 2016-13 "Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments", commonly referred to as CECL. 

The Company recorded a provision for credit losses of  $5.3 million for the quarter ended June 30, 2020, compared to $54.1 million for the quarter ended March 31, 2020. Asset quality was consistent during the second quarter and the increase in provision was primarily driven by the forecasted economic effect of the COVID-19 pandemic.

Total net charge-offs for the second quarter of 2020 were $1.4 million compared to $2.2 million in the first quarter of 2020. The ratio of net loan and lease charge-offs to average loans and leases on an annualized basis decreased to 8 basis points for the second quarter of 2020 from 13 basis points for the first quarter of 2020.

The allowance for loan and lease losses represented 1.61 percent of total loans and leases at June 30, 2020, compared to 1.66 percent at March 31, 2020, and 0.90 percent at June 30, 2019. Excluding PPP loans, the allowance for loan losses and lease losses represents 1.75 percent coverage at June 30, 2020 compared to 1.66 percent at March 31, 2020.

NON-INTEREST EXPENSE

Non-interest expense for the quarter ended June 30, 2020 decreased $1.6 million to $39.1 million from $40.7 million for the quarter ended March 31, 2020. The decrease was primarily driven by decreases of $0.6 million in compensation and employee benefits expense, $0.5 million in equipment and data processing expense, and $0.5 million in professional services expense.

PROVISION FOR INCOME TAXES

The effective tax rate was 24.9 percent and a negative 2.2 percent for the three and six months ended June 30, 2020 compared to 27.5 percent for the three months ended March 31, 2020 and 24.9 percent and 24.1 percent for the three and six months ended June 30, 2019.

RETURNS ON AVERAGE ASSETS AND AVERAGE EQUITY

The annualized return on average assets increased to 0.88 percent during the second quarter 2020 from a negative 0.87 percent for the first quarter of 2020.

The annualized return on average stockholders' equity increased to 8.45 percent during the second quarter of 2020 from a negative 7.30 percent for the first quarter of 2020. The annualized return on average tangible stockholders’ equity increased to 10.28 percent for the second quarter of 2020 from a negative 8.84 percent for the first quarter of 2020.

ASSET QUALITY

The ratio of nonperforming loans and leases to total loans and leases was 0.56 percent at June 30, 2020, a decrease from 0.57 percent at March 31, 2020. Nonperforming loans and leases increased $2.2 million to $41.3 million at June 30, 2020 from $39.1 million at March 31, 2020. The ratio of nonperforming assets to total assets was 0.47 percent at June 30, 2020, a decrease from 0.49 percent at March 31, 2020. Nonperforming assets increased $1.6 million to $42.8 million at June 30, 2020 from $41.1 million at March 31, 2020.

From March 1, 2020 through the earlier of December 31, 2020 or 60 days after the termination date of the national emergency declared by the President on March 13, 2020 concerning the COVID-19 outbreak (the “national emergency”), a financial institution may elect to suspend the requirements under accounting principles generally accepted in the U.S. for loan modifications related to the COVID-19 pandemic that would otherwise be categorized as a troubled debt restructured, including impairment accounting. This troubled debt restructuring relief applies for the term of the loan modification that occurs during the applicable period for a loan that was not more than 30 days past due as of December 31, 2019. Financial institutions are required to maintain records of the volume of loans involved in modifications to which troubled debt restructuring relief is applicable. As of June 30, 2020, the banks have granted 5,366 short-term deferments on loan balances of $1.2 billion, which represented 16 percent of total loan balances.

DIVIDEND DECLARED

The Company’s Board of Directors approved a dividend of $0.115 per share for the quarter ended June 30, 2020. The dividend will be paid on August 21, 2020 to stockholders of record on August 7, 2020.

CONFERENCE CALL

The Company will conduct a conference call/webcast at 1:30 PM Eastern Daylight Time on Thursday, July 23, 2020 to discuss the results for the quarter, business highlights and outlook. The call can be accessed by dialing 877-504-4120 (United States) or 412-902-6650 (internationally) or by visiting https://services.choruscall.com/links/brkl200723.html.  A recorded playback of the call will be available for one week following the call at 877-344-7529 (United States) or 412-317-0088 (internationally). The passcode for the playback is 10145885. The call will be available live and in a recorded version on the Company’s website under “Investor Relations” at www.brooklinebancorp.com.

ABOUT BROOKLINE BANCORP, INC.

Brookline Bancorp, Inc., a bank holding company with $9.1 billion in assets and branch locations in Massachusetts and Rhode Island, is headquartered in Boston, Massachusetts and operates as the holding company for Brookline Bank and Bank Rhode Island (the "banks"). The Company provides commercial and retail banking services, cash management and investment services to customers throughout Central New England. More information about Brookline Bancorp, Inc. and its banks can be found at the following websites: www.brooklinebank.com and www.bankri.com.

FORWARD-LOOKING STATEMENTS

Certain statements contained in this press release that are not historical facts may constitute 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, and are intended to be covered by the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Statements contained in this press release that do not describe historical or current facts are forward-looking statements, including statements regard the potential effects of COVID-19 on the Company’s business, credit quality, financial condition, liquidity and results of operations. Forward-looking statements made with regard to the potential effects of COVID-19 on the Company’s business, financial condition, credit quality, liquidity and results of operation may differ, possibly materially, from what is included in this press release due to factors and future developments that are uncertain and beyond the scope of the Company’s control. These included, but are not limited to, the length and extent of the economic contraction as a result of the COVID-19 pandemic; continued deterioration in employment levels, general business and economic conditions on a national basis and in the local markets in which the Company operates; the possibility that future credit losses may be higher than currently expected; changes in consumer behavior due to changing political business and economic conditions or legislative or regulatory initiatives; the possibility that future credit losses may be higher than currently expected; reputational risk relating to the Company’s participation in the Paycheck Protection Program and other pandemic-related legislative and regulatory initiatives and programs; and turbulence in capital and debt markets. Forward-looking statements involve risks and uncertainties which are difficult to predict. The Company’s actual results could differ materially from those projected in the forward-looking statements as a result of, among others, the risks outlined in the Company’s Annual Report on Form 10-K, as updated by its Quarterly Reports on Form 10-Q and other filings submitted to the Securities and Exchange Commission ("SEC"). The Company does not undertake any obligation to update any forward-looking statement to reflect circumstances or events that occur after the date the forward-looking statements are made.

BASIS OF PRESENTATION

The Company's consolidated financial statements have been prepared in conformity with generally accepted accounting principles (“GAAP”) as set forth by the Financial Accounting Standards Board in its Accounting Standards Codification and through the rules and interpretive releases of the SEC under the authority of federal securities laws. Certain amounts previously reported have been reclassified to conform to the current period's presentation.

NON-GAAP FINANCIAL MEASURES

The Company uses certain non-GAAP financial measures, such as operating earnings, operating return on average assets, operating return on average tangible assets, operating return on average stockholders' equity, operating return on average tangible stockholders' equity, the allowance for loan and lease losses related to originated loans and leases as a percentage of originated loans and leases, tangible book value per common share, tangible stockholders’ equity to tangible assets, return on average tangible assets (annualized) and return on average tangible stockholders' equity (annualized). These non-GAAP financial measures provide information for investors to effectively analyze financial trends of ongoing business activities, and to enhance comparability with peers across the financial services sector. A detailed reconciliation table of the Company's GAAP to the non-GAAP measures is attached.

INVESTOR RELATIONS:

Contact:     Carl M. Carlson
Brookline Bancorp, Inc.
Chief Financial Officer
(617) 425-5331
ccarlson@brkl.com
     

 

BROOKLINE BANCORP, INC. AND SUBSIDIARIES
Selected Financial Highlights (Unaudited)
 
  At and for the Three Months Ended
  June 30, 2020   March 31, 2020   December 31, 2019   September 30, 2019   June 30, 2019
  (Dollars In Thousands Except per Share Data)
Earnings Data:                  
Net interest income $ 64,288     $ 61,712     $ 63,931     $ 63,236     $ 63,134  
Provision for credit losses   5,347       54,114       3,602       871       3,757  
Non-interest income   6,235       9,328       7,756       7,929       7,478  
Non-interest expense   39,109       40,748       38,815       40,191       39,604  
Income (loss) before provision for income taxes   26,067       (23,822 )     29,270       30,103       27,251  
Net income (loss) attributable to Brookline Bancorp, Inc.   19,571       (17,276 )     22,183       22,596       20,471  
                   
Performance Ratios:                  
Net interest margin (1)   3.09 %     3.31 %     3.43 %     3.45 %     3.55 %
Interest-rate spread (1)   2.75 %     2.91 %     3.05 %     3.06 %     3.13 %
Return on average assets (annualized)   0.88 %     (0.87 )%     1.13 %     1.17 %     1.08 %
Return on average tangible assets (annualized) (non-GAAP)   0.90 %     (0.89 )%     1.15 %     1.19 %     1.11 %
Return on average stockholders' equity (annualized)   8.45 %     (7.30 )%     9.42 %     9.74 %     8.98 %
Return on average tangible stockholders' equity (annualized) (non-GAAP)   10.28 %     (8.84 )%     11.42 %     11.85 %     10.98 %
Efficiency ratio (2)   55.46 %     57.36 %     54.15 %     56.48 %     56.09 %
                   
Per Common Share Data:                  
Net income (loss) — Basic $ 0.25     $ (0.22 )   $ 0.28     $ 0.28     $ 0.26  
Net income (loss) — Diluted   0.25       (0.22 )     0.28       0.28       0.26  
Cash dividends declared   0.115       0.115       0.115       0.115       0.110  
Book value per share (end of period)   11.75       11.57       11.87       11.70       11.53  
Tangible book value per share (end of period) (non-GAAP)   9.67       9.49       9.80       9.63       9.45  
Stock price (end of period)   10.08       11.28       16.46       14.73       15.38  
Balance Sheet:                  
Total assets $ 9,069,667     $ 8,461,591     $ 7,856,853     $ 7,878,436     $ 7,636,980  
Total loans and leases   7,407,697       6,822,527       6,737,816       6,646,821       6,505,329  
Total deposits   6,440,233       5,889,938       5,830,072       5,729,339       5,622,493  
Brookline Bancorp, Inc. stockholders’ equity   926,413       912,568       945,606       932,311       918,468  
                   
Asset Quality:                  
Nonperforming assets $ 42,754     $ 41,122     $ 22,092     $ 23,760     $ 23,267  
Nonperforming assets as a percentage of total assets   0.47 %     0.49 %     0.28 %     0.30 %     0.30 %
Allowance for loan and lease losses $ 119,553     $ 113,181     $ 61,082     $ 59,135     $ 58,635  
Allowance for loan and lease losses as a percentage of total loans and leases   1.61 %     1.66 %     0.91 %     0.89 %     0.90 %
Net loan and lease charge-offs $ 1,383     $ 2,234     $ 1,622     $ 366     $ 3,082  
Net loan and lease charge-offs as a percentage of average loans and leases (annualized)   0.08 %     0.13 %     0.10 %     0.02 %     0.19 %
                   
Capital Ratios:                  
Stockholders’ equity to total assets   10.21 %     10.78 %     12.04 %     11.83 %     12.03 %
Tangible stockholders’ equity to tangible assets (non-GAAP)   8.56 %     9.02 %     10.15 %     9.94 %     10.08 %
                   

(1) Calculated on a fully tax-equivalent basis.
(2) Calculated as non-interest expense as a percentage of net interest income plus non-interest income.

BROOKLINE BANCORP, INC. AND SUBSIDIARIES
Consolidated Balance Sheets (Unaudited)
  June 30, 2020   March 31, 2020   December 31, 2019   September 30, 2019   June 30, 2019
ASSETS (In Thousands Except Share Data)
Cash and due from banks $ 38,522     $ 86,996     $ 33,589     $ 93,841     $ 46,532  
Short-term investments   216,394       253,772       44,201       84,689       46,264  
Total cash and cash equivalents   254,916       340,768       77,790       178,530       92,796  
Investment securities available-for-sale   854,505       761,539       498,995       467,339       482,497  
Investment securities held-to-maturity               86,780       95,163       103,572  
Equity securities held-for-trading   1,992       2,558       3,581       4,581       4,698  
Total investment securities   856,497       764,097       589,356       567,083       590,767  
Loans and leases held-for-sale                           1,575  
Loans and leases:                  
Commercial real estate loans   3,837,703       3,762,158       3,669,222       3,589,451       3,493,554  
Commercial loans and leases   2,361,463       1,826,866       1,838,748       1,850,388       1,826,336  
Consumer loans   1,208,531       1,233,503       1,229,846       1,206,982       1,185,439  
Total loans and leases   7,407,697       6,822,527       6,737,816       6,646,821       6,505,329  
Allowance for loan and lease losses   (119,553 )     (113,181 )     (61,082 )     (59,135 )     (58,635 )
Net loans and leases   7,288,144       6,709,346       6,676,734       6,587,686       6,446,694  
Restricted equity securities   71,638       68,472       53,818       57,896       55,270  
Premises and equipment, net of accumulated depreciation   73,127       73,786       74,350       75,229       75,373  
Right-of-use asset operating leases   24,343       24,789       24,876       26,216       25,928  
Deferred tax asset   42,683       38,141       25,017       25,204       25,629  
Goodwill   160,427       160,427       160,427       160,427       160,427  
Identified intangible assets, net of accumulated amortization   3,775       4,087       4,423       4,843       5,264  
Other real estate owned and repossessed assets   1,454       2,038       2,631       2,132       1,966  
Other assets   292,663       275,640       167,431       193,190       155,291  
Total assets $ 9,069,667     $ 8,461,591     $ 7,856,853     $ 7,878,436     $ 7,636,980  
LIABILITIES AND STOCKHOLDERS' EQUITY                  
Deposits:                  
Demand checking accounts $ 1,603,037     $ 1,175,329     $ 1,141,578     $ 1,106,684     $ 1,042,854  
NOW accounts   417,622       361,854       371,380       340,321       340,082  
Savings accounts   657,758       653,026       613,467       604,481       585,322  
Money market accounts   1,809,868       1,676,092       1,682,005       1,666,231       1,669,782  
Certificate of deposit accounts   1,951,948       2,023,637       2,021,642       2,011,622       1,984,453  
Total deposits   6,440,233       5,889,938       5,830,072       5,729,339       5,622,493  
Borrowed funds:                  
Advances from the FHLBB   1,267,570       1,137,431       758,469       854,481       791,559  
Subordinated debentures and notes   83,668       83,630       83,591       83,551       83,512  
Other borrowed funds   55,431       70,743       60,689       48,373       55,693  
Total borrowed funds   1,406,669       1,291,804       902,749       986,405       930,764  
Operating lease liabilities   24,343       24,789       24,876       26,216       25,928  
Mortgagors’ escrow accounts   6,467       7,441       7,232       7,072       6,823  
Reserve for unfunded credits   14,816       17,222       1,880       1,847       1,841  
Accrued expenses and other liabilities   250,726       317,829       144,438       195,246       130,663  
Total liabilities   8,143,254       7,549,023       6,911,247       6,946,125       6,718,512  
Stockholders' equity:                  
Brookline Bancorp, Inc. stockholders’ equity:                  
Common stock, $0.01 par value; 200,000,000 shares authorized; 85,177,172 shares issued, 85,177,172 shares issued, 85,177,172 shares issued, 85,177,172 shares issued, and 85,177,172 shares issued, respectively   852       852       852       852       852  
Additional paid-in capital   738,155       737,422       736,601       735,928       737,584  
Retained earnings, partially restricted   237,808       227,359       265,376       252,435       238,625  
Accumulated other comprehensive income (loss)   19,538       16,947       2,283       2,775       1,141  
Treasury stock, at cost;                  
5,859,708, 5,862,811, 5,003,127, 5,003,127, and 5,025,764 shares, respectively   (69,572 )     (69,617 )     (59,073 )     (59,176 )     (59,199 )
Unallocated common stock held by the Employee Stock Ownership Plan;                  
65,334, 72,441 79,548, 92,337, and 98,208 shares, respectively   (368 )     (395 )     (433 )     (503 )     (535 )
Total stockholders' equity   926,413       912,568       945,606       932,311       918,468  
Total liabilities and stockholders' equity $ 9,069,667     $ 8,461,591     $ 7,856,853     $ 7,878,436     $ 7,636,980  
                                       

 

BROOKLINE BANCORP, INC. AND SUBSIDIARIES
Consolidated Statements of Income (Unaudited)
  Three Months Ended
  June 30, 2020   March 31, 2020   December 31, 2019   September 30, 2019   June 30, 2019
  (In Thousands Except Share Data)
Interest and dividend income:                  
Loans and leases $ 77,416   $ 79,559     $ 83,309   $ 83,566     $ 82,798
Debt securities   3,701     2,976       2,910     2,977       3,158
Marketable and restricted equity securities   908     778       813     876       877
Short-term investments   99     209       418     487       351
Total interest and dividend income   82,124     83,522       87,450     87,906       87,184
Interest expense:                  
Deposits   12,778     16,240       17,655     18,300       17,712
Borrowed funds   5,058     5,570       5,864     6,370       6,338
Total interest expense   17,836     21,810       23,519     24,670       24,050
Net interest income   64,288     61,712       63,931     63,236       63,134
Provision for credit losses   5,347     54,114       3,602     871       3,757
Net interest income after provision for credit losses   58,941     7,598       60,329     62,365       59,377
Non-interest income:                  
Deposit fees   1,929     2,458       2,710     2,710       2,680
Loan fees   513     550       567     719       398
Loan level derivative income, net   1,440     2,156       2,494     2,251       1,772
Gain (loss) on investment securities, net   586     1,330       133     (116 )     357
Gain on sales of loans and leases held-for-sale   299     120       309     550       561
Other   1,468     2,714       1,543     1,815       1,710
Total non-interest income   6,235     9,328       7,756     7,929       7,478
Non-interest expense:                  
Compensation and employee benefits   24,619     25,219       23,987     24,871       23,953
Occupancy   3,825     3,953       4,102     3,895       3,752
Equipment and data processing   4,155     4,703       4,601     4,749       4,641
Professional services   1,056     1,651       1,120     1,083       1,087
FDIC insurance   858     378       53     54       745
Advertising and marketing   1,017     1,075       828     1,035       1,112
Amortization of identified intangible assets   311     336       420     421       420
Merger and restructuring expense                 1,125      
Other   3,268     3,433       3,704     2,958       3,894
Total non-interest expense   39,109     40,748       38,815     40,191       39,604
Income (loss) before provision for income taxes   26,067     (23,822 )     29,270     30,103       27,251
Provision (benefit) for income taxes   6,496     (6,546 )     7,087     7,507       6,780
Net income (loss) attributable to Brookline Bancorp, Inc. $ 19,571   $ (17,276 )   $ 22,183   $ 22,596     $ 20,471
Earnings per common share:                  
Basic $ 0.25   $ (0.22 )   $ 0.28   $ 0.28     $ 0.26
Diluted $ 0.25   $ (0.22 )   $ 0.28   $ 0.28     $ 0.26
Weighted average common shares outstanding during the period:                
Basic   78,849,282     79,481,462       79,682,724     79,700,403       79,669,922
Diluted   79,015,274     79,665,774       79,845,447     79,883,510       79,886,292
Dividends paid per common share $ 0.115   $ 0.115     $ 0.115   $ 0.110     $ 0.110
                   

 

BROOKLINE BANCORP, INC. AND SUBSIDIARIES
Consolidated Statements of Income (Unaudited)
   
  Six Months Ended June 30,
  2020   2019
  (In Thousands Except Share Data)
Interest and dividend income:      
Loans and leases $ 156,975     $ 163,470
Debt securities   6,677       6,394
Marketable and restricted equity securities   1,686       1,788
Short-term investments   308       618
Total interest and dividend income   165,646       172,270
Interest expense:      
Deposits   29,018       33,660
Borrowed funds   10,628       12,477
Total interest expense   39,646       46,137
Net interest income   126,000       126,133
Provision for credit losses   59,461       5,110
Net interest income after provision for credit losses   66,539       121,023
Non-interest income:      
Deposit Fees   4,387       5,203
Loan Fees   1,063       811
Loan level derivative income, net   3,596       3,517
Gain on investment securities, net   1,916       491
Gain on sales of loans and leases held-for-sale   419       850
Other   4,182       3,236
Total non-interest income   15,563       14,108
Non-interest expense:      
Compensation and employee benefits   49,838       47,696
Occupancy   7,778       7,699
Equipment and data processing   8,858       9,302
Professional services   2,707       2,163
FDIC insurance   1,236       1,338
Advertising and marketing   2,092       2,181
Amortization of identified intangible assets   647       822
Other   6,701       7,274
Total non-interest expense   79,857       78,475
Income before provision for income taxes   2,245       56,656
(Benefit) provision for income taxes   (50 )     13,675
Net income before noncontrolling interest in subsidiary   2,295       42,981
Less net income attributable to noncontrolling interest in subsidiary         43
Net income attributable to Brookline Bancorp, Inc. $ 2,295     $ 42,938
Earnings per common share:      
Basic $ 0.03     $ 0.54
Diluted $ 0.03     $ 0.54
Weighted average common shares outstanding during the period:    
Basic   79,165,372       79,664,284
Diluted   79,340,524       79,859,572
Dividends paid per common share $ 0.230     $ 0.215
       

 

BROOKLINE BANCORP, INC. AND SUBSIDIARIES
Asset Quality Analysis (Unaudited)
  At and for the Three Months Ended
  June 30, 2020   March 31, 2020   December 31, 2019   September 30, 2019   June 30, 2019
  (Dollars in Thousands)
NONPERFORMING ASSETS:                  
Loans and leases accounted for on a nonaccrual basis:                  
Commercial real estate mortgage $ 10,139     $ 10,937     $ 2,845     $ 2,910     $ 2,273  
Multi-family mortgage         85       84       87       94  
Total commercial real estate loans   10,139       11,022       2,929       2,997       2,367  
                   
Commercial   12,427       12,991       4,909       3,139       6,349  
Equipment financing   13,100       10,356       9,822       12,817       9,931  
Condominium association   190       203       151       163       170  
Total commercial loans and leases   25,717       23,550       14,882       16,119       16,450  
                   
Residential mortgage   4,157       3,446       753       1,605       1,642  
Home equity   1,278       1,059       896       904       835  
Other consumer   9       7       1       3       7  
Total consumer loans   5,444       4,512       1,650       2,512       2,484  
                   
Total nonaccrual loans and leases   41,300       39,084       19,461       21,628       21,301  
                   
Other real estate owned                     201       957  
Other repossessed assets   1,454       2,038       2,631       1,931       1,009  
Total nonperforming assets $ 42,754     $ 41,122     $ 22,092     $ 23,760     $ 23,267  
                   
Loans and leases past due greater than 90 days and still accruing $ 1,974     $ 1,045     $ 10,109     $ 11,885     $ 11,612  
                   
Troubled debt restructurings on accrual   10,172       16,480       17,076       22,233       27,761  
Troubled debt restructurings on nonaccrual   5,972       5,819       6,104       5,763       8,431  
Total troubled debt restructurings $ 16,144     $ 22,299     $ 23,180     $ 27,996     $ 36,192  
                   
Nonperforming loans and leases as a percentage of total loans and leases   0.56 %     0.57 %     0.29 %     0.33 %     0.33 %
Nonperforming assets as a percentage of total assets   0.47 %     0.49 %     0.28 %     0.30 %     0.30 %
                   
PROVISION AND ALLOWANCE FOR LOAN AND LEASE LOSSES:            
Allowance for loan and lease losses at beginning of period $ 113,181     $ 61,082     $ 59,135     $ 58,635     $ 58,041  
CECL adjustment to retained earnings         6,632                    
Charge-offs   (1,803 )     (2,539 )     (1,894 )     (1,190 )     (3,412 )
Recoveries   420       305       272       824       330  
Net charge-offs   (1,383 )     (2,234 )     (1,622 )     (366 )     (3,082 )
Provision for loan and lease losses excluding unfunded commitments *   7,755       47,701       3,569       866       3,676  
Allowance for loan and lease losses at end of period $ 119,553     $ 113,181     $ 61,082     $ 59,135     $ 58,635  
                   
Allowance for loan and lease losses as a percentage of total loans and leases   1.61 %     1.66 %     0.91 %     0.89 %     0.90 %
                   
NET CHARGE-OFFS:                  
Commercial real estate loans $ (94 )   $     $     $     $  
Commercial loans and leases   1,498       2,280       1,589       403       3,107  
Consumer loans   (21 )     (46 )     33       (37 )     (25 )
Total net charge-offs $ 1,383     $ 2,234     $ 1,622     $ 366     $ 3,082  
                   
Net loan and lease charge-offs as a percentage of average loans and leases (annualized)   0.08 %     0.13 %     0.10 %     0.02 %     0.19 %
                   

*provision for loan and lease losses does not include provision of $2.4 million and $6.4 million for credit losses on unfunded commitments during the three months ended June 30, 2020 and March 31, 2020, respectively.

BROOKLINE BANCORP, INC. AND SUBSIDIARIES
Average Yields / Costs (Unaudited)
  Three Months Ended
  June 30, 2020   March 31, 2020   June 30, 2019
  Average Balance   Interest (1)   Average Yield/ Cost   Average Balance   Interest (1)   Average Yield/ Cost   Average Balance   Interest (1)   Average Yield/ Cost
  (Dollars in Thousands)
Assets:                                  
Interest-earning assets:                                  
Investments:                                  
Debt securities (2) $ 773,523   $ 3,719   1.92 %   $ 605,885   $ 3,024   2.00 %   $ 593,404   $ 3,210   2.16 %
Marketable and restricted equity securities (2)   71,058     915   5.15 %     58,881     786   5.33 %     59,224     888   5.99 %
Short-term investments   245,577     99   0.16 %     84,309     209   0.99 %     44,634     351   3.14 %
Total investments   1,090,158     4,733   1.74 %     749,075     4,019   2.15 %     697,262     4,449   2.55 %
Loans and Leases:                                  
Commercial real estate loans (3)   3,761,667     36,829   3.87 %     3,697,011     40,468   4.33 %     3,447,136     41,363   4.75 %
Commercial loans (3)   1,234,537     10,450   3.35 %     783,309     8,328   4.21 %     811,890     9,879   4.82 %
Equipment financing (3)   1,069,192     18,973   7.10 %     1,052,846     18,946   7.20 %     1,005,376     18,291   7.28 %
Residential mortgage loans (3)   814,431     8,068   3.96 %     810,583     7,934   3.92 %     774,533     8,186   4.23 %
Other consumer loans (3)   411,326     3,153   3.07 %     417,815     3,955   3.79 %     417,600     5,187   4.97 %
Total loans and leases   7,291,153     77,473   4.25 %     6,761,564     79,631   4.71 %     6,456,535     82,906   5.14 %
Total interest-earning assets   8,381,311     82,206   3.92 %     7,510,639     83,650   4.46 %     7,153,797     87,355   4.88 %
Non-interest-earning assets   488,229             455,187             417,599        
Total assets $ 8,869,540           $ 7,965,826           $ 7,571,396        
                                   
Liabilities and Stockholders' Equity:                                  
Interest-bearing liabilities:                                  
Deposits:                                  
NOW accounts $ 395,158     114   0.12 %   $ 359,641     116   0.13 %   $ 343,745     50   0.06 %
Savings accounts   663,782     357   0.22 %     626,945     643   0.41 %     602,333     737   0.49 %
Money market accounts   1,784,343     2,074   0.47 %     1,678,649     4,241   1.02 %     1,683,735     5,571   1.33 %
Certificates of deposit   2,019,195     10,233   2.04 %     2,040,903     11,240   2.22 %     1,950,704     11,354   2.33 %
Total interest-bearing deposits   4,862,478     12,778   1.06 %     4,706,138     16,240   1.39 %     4,580,517     17,712   1.55 %
Borrowings                                  
Advances from the FHLBB   1,102,079     3,751   1.35 %     772,462     4,097   2.10 %     761,651     4,825   2.51 %
Subordinated debentures and notes   83,647     1,263   6.04 %     83,609     1,284   6.14 %     83,490     1,305   6.25 %
Other borrowed funds   70,795     44   0.25 %     91,052     189   0.84 %     84,600     208   0.99 %
Total borrowings   1,256,521     5,058   1.59 %     947,123     5,570   2.33 %     929,741     6,338   2.70 %
Total interest-bearing liabilities   6,118,999     17,836   1.17 %     5,653,261     21,810   1.55 %     5,510,258     24,050   1.75 %
Non-interest-bearing liabilities:                                  
Demand checking accounts   1,512,089             1,134,314             1,015,524        
Other non-interest-bearing liabilities   312,213             232,113             133,790        
Total liabilities   7,943,301             7,019,688             6,659,572        
Stockholders’ equity   926,239             946,138             911,824        
Noncontrolling interest in subsidiary                                  
Total liabilities and equity $ 8,869,540           $ 7,965,826           $ 7,571,396        
Net interest income (tax-equivalent basis) /Interest-rate spread (4)       64,370   2.75 %         61,840   2.91 %         63,305   3.13 %
Less adjustment of tax-exempt income       82             128             171    
Net interest income     $ 64,288           $ 61,712           $ 63,134    
Net interest margin (5)         3.09 %           3.31 %           3.55 %
                                   
(1) Tax-exempt income on debt securities, equity securities and revenue bonds included in commercial real estate loans is included on a tax-equivalent basis.
(2) Average balances include unrealized gains (losses) on investment securities. Dividend payments may not be consistent and average yield on equity securities may vary from month to month.
(3) Loans on nonaccrual status are included in the average balances.
(4) Interest rate spread represents the difference between the yield on interest-earning assets and the cost of interest-bearing liabilities.
(5) Net interest margin represents net interest income (tax-equivalent basis) divided by average interest-earning assets on an actual/actual basis.
                                   

 

BROOKLINE BANCORP, INC. AND SUBSIDIARIES
Average Yields / Costs (Unaudited)
  Six Months Ended
  June 30, 2020   June 30, 2019
  Average Balance   Interest (1)   Average Yield/ Cost   Average Balance   Interest (1)   Average Yield/ Cost
  (Dollars in Thousands)
Assets:                      
Interest-earning assets:                      
Investments:                      
Debt securities (2) $ 689,704   $ 6,743   1.96 %   $ 600,758   $ 6,499   2.16 %
Marketable and restricted equity securities (2)   64,968     1,701   5.24 %     59,803     1,808   6.05 %
Short-term investments   164,943     308   0.37 %     38,866     618   3.18 %
Total investments   919,615     8,752   1.90 %     699,427     8,925   2.55 %
Loans and Leases:                      
Commercial real estate loans (3)   3,729,339     77,297   4.10 %     3,412,051     81,382   4.74 %
Commercial loans (3)   1,008,923     18,778   3.68 %     802,346     19,482   4.83 %
Equipment financing (3)   1,061,019     37,919   7.15 %     996,832     36,276   7.28 %
Residential mortgage loans (3)   812,507     16,002   3.94 %     776,419     16,309   4.20 %
Other consumer loans (3)   414,570     7,108   3.43 %     412,914     10,238   4.99 %
Total loans and leases   7,026,358     157,104   4.47 %     6,400,562     163,687   5.11 %
Total interest-earning assets   7,945,973     165,856   4.17 %     7,099,989     172,612   4.86 %
Non-interest-earning assets   471,710             403,107        
Total assets $ 8,417,683           $ 7,503,096        
                       
Liabilities and Stockholders' Equity:                      
Interest-bearing liabilities:                      
Deposits:                      
NOW accounts $ 377,399     230   0.12 %   $ 338,983     192   0.11 %
Savings accounts   645,363     1,000   0.31 %     614,307     1,334   0.44 %
Money market accounts   1,731,496     6,315   0.73 %     1,679,988     10,846   1.30 %
Certificates of deposit   2,030,049     21,473   2.13 %     1,897,901     21,288   2.26 %
Total interest-bearing deposits   4,784,307     29,018   1.22 %     4,531,179     33,660   1.50 %
Borrowings                      
Advances from the FHLBB   937,271     7,848   1.66 %     758,613     9,435   2.47 %
Subordinated debentures and notes   83,628     2,547   6.09 %     83,471     2,613   6.26 %
Other borrowed funds   80,924     233   0.58 %     86,589     429   1.00 %
Total borrowings   1,101,823     10,628   1.91 %     928,673     12,477   2.67 %
Total interest-bearing liabilities   5,886,130     39,646   1.35 %     5,459,852     46,137   1.70 %
Non-interest-bearing liabilities:                      
Demand checking accounts   1,323,202             1,021,215        
Other non-interest-bearing liabilities   272,162             122,544        
Total liabilities   7,481,494             6,603,611        
Brookline Bancorp, Inc. stockholders’ equity   936,189             899,301        
Noncontrolling interest in subsidiary               184        
Total liabilities and equity $ 8,417,683           $ 7,503,096        
Net interest income (tax-equivalent basis) /Interest-rate spread (4)       126,210   2.82 %         126,475   3.16 %
Less adjustment of tax-exempt income       210             342    
Net interest income     $ 126,000           $ 126,133    
Net interest margin (5)         3.19 %           3.59 %
                       
(1) Tax-exempt income on debt securities, equity securities and revenue bonds included in commercial real estate loans is included on a tax-equivalent basis.
(2) Average balances include unrealized gains (losses) on investment securities. Dividend payments may not be consistent and average yield on equity securities may vary from month to month.
(3) Loans on nonaccrual status are included in the average balances.
(4) Interest rate spread represents the difference between the yield on interest-earning assets and the cost of interest-bearing liabilities.
(5) Net interest margin represents net interest income (tax-equivalent basis) divided by average interest-earning assets on an actual/actual basis.
                       

 

BROOKLINE BANCORP, INC. AND SUBSIDIARIES
Non-GAAP Financial Information (Unaudited)
      At and for the Three Months Ended June 30,   At and for the Six Months Ended June 30,
        2020       2019       2020       2019  
Reconciliation Table - Non-GAAP Financial Information   (Dollars in Thousands Except Share Data)
                 
Net income attributable to Brookline Bancorp, Inc.   $ 19,571     $ 20,471     $ 2,295     $ 42,938  
Less:                  
Security gains (after-tax)     440       268       1,958       373  
Operating earnings     $ 19,131     $ 20,203     $ 337     $ 42,565  
                   
Operating earnings per common share:                  
Basic     $ 0.24     $ 0.25     $     $ 0.53  
Diluted       0.24       0.25             0.53  
                   
Weighted average common shares outstanding during the period:                
Basic       78,849,282       79,669,922       79,165,372       79,664,284  
Diluted       79,015,274       79,886,292       79,340,524       79,859,572  
                   
                   
Return on average assets *     0.88 %     1.08 %     0.05 %     1.14 %
Less:                  
Security gains (after-tax) *     0.02 %     0.01 %     0.04 %     0.01 %
Operating return on average assets *     0.86 %     1.07 %     0.01 %     1.13 %
                   
                   
Return on average tangible assets *     0.90 %     1.11 %     0.06 %     1.17 %
Less:                  
Security gains (after-tax) *     0.02 %     0.02 %     0.05 %     0.01 %
Operating return on average tangible assets *     0.88 %     1.09 %     0.01 %     1.16 %
                   
                   
Return on average stockholders' equity *     8.45 %     8.98 %     0.49 %     9.55 %
Less:                  
Security gains (after-tax) *     0.19 %     0.12 %     0.42 %     0.08 %
Operating return on average stockholders' equity *     8.26 %     8.86 %     0.07 %     9.47 %
                   
                   
Return on average tangible stockholders' equity *     10.28 %     10.98 %     0.59 %     11.71 %
Less:                  
Security gains (after-tax) *     0.24 %     0.15 %     0.50 %     0.10 %
Operating return on average tangible stockholders' equity *     10.04 %     10.83 %     0.09 %     11.61 %
                   
* Ratios at and for the three and six months ended are annualized.                
                   
  At and for the Three Months Ended
  June 30, 2020   March 31, 2020   December 31, 2019   September 30, 2019   June 30, 2019
  (Dollars in Thousands)
                   
Net income (loss), as reported $ 19,571     $ (17,276 )   $ 22,183     $ 22,596     $ 20,471  
                   
Average total assets $ 8,869,540     $ 7,965,826     $ 7,860,593     $ 7,746,492     $ 7,571,396  
Less: Average goodwill and average identified intangible assets, net   164,385       164,701       165,071       165,493       165,914  
Average tangible assets $ 8,705,155     $ 7,801,125     $ 7,695,522     $ 7,580,999     $ 7,405,482  
                   
Return on average tangible assets (annualized)   0.90 %     (0.89 )%     1.15 %     1.19 %     1.11 %
                   
Average total stockholders’ equity $ 926,239     $ 946,138     $ 941,891     $ 928,063     $ 911,824  
Less: Average goodwill and average identified intangible assets, net   164,385       164,701       165,071       165,493       165,914  
Average tangible stockholders’ equity $ 761,854     $ 781,437     $ 776,820     $ 762,570     $ 745,910  
                   
Return on average tangible stockholders’ equity (annualized)   10.28 %     (8.84 )%     11.42 %     11.85 %     10.98 %
                   
Brookline Bancorp, Inc. stockholders’ equity $ 926,413     $ 912,568     $ 945,606     $ 932,311     $ 918,468  
Less:                  
Goodwill   160,427       160,427       160,427       160,427       160,427  
Identified intangible assets, net   3,775       4,087       4,423       4,843       5,264  
Tangible stockholders' equity $ 762,211     $ 748,054     $ 780,756     $ 767,041     $ 752,777  
                   
Total assets $ 9,069,667     $ 8,461,591     $ 7,856,853     $ 7,878,436     $ 7,636,980  
Less:                  
Goodwill   160,427       160,427       160,427       160,427       160,427  
Identified intangible assets, net   3,775       4,087       4,423       4,843       5,264  
Tangible assets $ 8,905,465     $ 8,297,077     $ 7,692,003     $ 7,713,166     $ 7,471,289  
                   
Tangible stockholders’ equity to tangible assets   8.56 %     9.02 %     10.15 %     9.94 %     10.08 %
                   
Tangible stockholders' equity $ 762,211     $ 748,054     $ 780,756     $ 767,041     $ 752,777  
                   
Number of common shares issued   85,177,172       85,177,172       85,177,172       85,177,172       85,177,172  
Less:                  
Treasury shares   5,859,708       5,862,811       5,003,127       5,003,127       5,025,764  
Unallocated ESOP shares   65,334       72,441       79,548       92,337       98,208  
Unvested restricted shares   398,188       395,085       406,450       407,784       377,122  
Number of common shares outstanding   78,853,942       78,846,835       79,688,047       79,673,924       79,676,078  
                   
Tangible book value per common share $ 9.67     $ 9.49     $ 9.80     $ 9.63     $ 9.45  
                   
Allowance for loan and lease losses $ 119,553     $ 113,181     $ 61,082     $ 59,135     $ 58,635  
                   
Total loans and leases $ 7,407,697     $ 6,822,527     $ 6,737,816     $ 6,646,821     $ 6,505,329  
Less:                  
Total PPP loans   565,768                          
Total loans and leases excluding PPP loans $ 6,841,929     $ 6,822,527     $ 6,737,816     $ 6,646,821     $ 6,505,329  
                   
Allowance for loan and lease losses as a percentage of total loans and leases less PPP loans   1.75 %     1.66 %     0.91 %     0.89 %     0.90 %
                   

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Source: Brookline Bancorp, Inc.