Press Release

Net Income of $26.5 million, EPS of $0.34

Quarterly Dividend Increase of 4.3%

BOSTON, April 28, 2021 (GLOBE NEWSWIRE) -- Brookline Bancorp, Inc. (NASDAQ: BRKL) (the “Company”) today announced net income of $26.5 million, or $0.34 per basic and diluted share, for the first quarter of 2021, compared to net income of $26.7 million, or $0.34 per basic and diluted share, for the fourth quarter of 2020, and net loss of $(17.3) million, or $(0.22) per basic and diluted share, for the first quarter of 2020.

“Our Company’s solid performance continued in the first quarter and I am pleased to announce an increase in our dividend to $0.12 per share,” Paul Perrault, President and Chief Executive Officer of the Company continued, “We are proud of the work that our employees have done in supporting our customers and communities over the past year and we look forward to a continued strong performance for the remainder of the year.”

BALANCE SHEET

Total assets at March 31, 2021 decreased $382.6 million to $8.6 billion from $8.9 billion at December 31, 2020, and increased $98.2 million from $8.5 billion at March 31, 2020. At March 31, 2021, total loans and leases were $7.3 billion, representing a decrease of $2.0 million from December 31, 2020, and an increase of $445.0 million from March 31, 2020.

On December 27, 2020, the Economic Aid to Hard-Hit Small Businesses, Nonprofits, and Venues Act (the “Economic Aid Act”) was signed into law. The Economic Aid Act created a new round of Paycheck Protection Program (“PPP”) loans administered by the Small Business Administration (“SBA”). The Company participated in the new round of PPP lending and, as of March 31, 2021, has funded 1,342 PPP loans totaling $249.5 million. The Company funded 2,922 PPP loans totaling $581.7 million in the first two rounds of PPP funding which closed on August 8, 2020, of which $355.3 million remains outstanding, net of deferred fees and costs, at March 31, 2021.

Total investment securities at March 31, 2021 decreased $15.9 million to $730.4 million from $746.3 million at December 31, 2020, and decreased $33.7 million from $764.1 million at March 31, 2020. Total cash and cash equivalents at March 31, 2021 decreased $304.0 million to $130.9 million from $434.9 million at December 31, 2020, and decreased $209.8 million from $340.8 million at March 31, 2020. As of March 31, 2021, total investment securities and total cash and cash equivalents represented 10.1 percent of total assets as compared to 13.2 percent and 13.1 percent as of December 31, 2020 and March 31, 2020, respectively.

Total deposits at March 31, 2021 decreased $43.9 million to $6.87 billion from $6.91 billion at December 31, 2020 and increased $1.0 billion from $5.9 billion at March 31, 2020.

Total borrowed funds at March 31, 2021 decreased $274.2 million to $546.0 million from $820.2 million at December 31, 2020 and decreased $745.8 million from $1.3 billion at March 31, 2020.

The ratio of stockholders’ equity to total assets was 11.04 percent at March 31, 2021, as compared to 10.53 percent at December 31, 2020, and 10.78 percent at March 31, 2020. The ratio of tangible stockholders’ equity to tangible assets (non-GAAP) was 9.31 percent at March 31, 2021, as compared to 8.86 percent at December 31, 2020, and 9.02 percent at March 31, 2020. Tangible book value per share (non-GAAP) increased $0.05 from $9.96 at December 31, 2020 to $10.01 at March 31, 2021, compared to $9.49 at March 31, 2020.

NET INTEREST INCOME

Net interest income increased $0.9 million to $69.1 million during the first quarter of 2021 from $68.2 million at the quarter ended December 31, 2020. The net interest margin increased 16 basis points to 3.39 percent for the three months ended March 31, 2021 from 3.23 percent for the three months ended December 31, 2020.

NON-INTEREST INCOME

Total non-interest income for the quarter ended March 31, 2021 increased $0.6 million to $4.8 million from $4.2 million for the quarter ended December 31, 2020. The increase was primarily driven by an increase of $0.6 million in gain on sales of loans and leases and an increase of $0.3 million in loan level derivative income, net, partially offset by a decrease of $0.3 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 negative provision for credit losses of $2.1 million for the quarter ended March 31, 2021, compared to a negative provision for credit losses of $2.1 million for the quarter ended December 31, 2020.

Total net charge-offs for the first quarter of 2021 were $1.8 million compared to $4.4 million in the fourth quarter of 2020. The decrease is primarily driven by a decrease of $3.4 million in the net charge-offs of commercial real estate loans, partially offset by an increase in the net charge-offs of commercial loans and equipment financing of $0.3 million and $0.5 million, respectively. The ratio of net loan and lease charge-offs to average loans and leases on an annualized basis decreased to 10 basis points for the first quarter of 2021 from 24 basis points for the fourth quarter of 2020.

The allowance for loan and lease losses represented 1.51 percent of total loans and leases at March 31, 2021, compared to 1.57 percent at December 31, 2020, and 1.66 percent at March 31, 2020. Excluding PPP loans, the allowance for loan and lease losses represents 1.65 percent coverage at March 31, 2021 compared to 1.69 percent at December 31, 2020.

ASSET QUALITY

The ratio of nonperforming loans and leases to total loans and leases was 0.43 percent at March 31, 2021, a decrease from 0.53 percent at December 31, 2020. Total nonaccrual loans and leases decreased $7.4 million to $31.0 million at March 31, 2021 from $38.4 million at December 31, 2020. The ratio of nonperforming assets to total assets was 0.44 percent at March 31, 2021, a decrease from 0.50 percent at December 31, 2020. Total nonperforming assets decreased $7.6 million to $37.4 million at March 31, 2021 from $45.0 million at December 31, 2020.

From March 1, 2020 through the earlier of January 1, 2022 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 March 31, 2021, approximately 88 percent of loans granted an initial loan payment deferral have returned to payment status and 341 credits totaling $126 million or 1.7 percent of total loans outstanding are operating under modified terms.

NON-INTEREST EXPENSE

Non-interest expense for the quarter ended March 31, 2021 increased $0.8 million to $40.8 million from $40.0 million for the quarter ended December 31, 2020. The increase was primarily driven by increases of $0.8 million in compensation and employee benefits expense, $0.3 million in equipment and data processing, $0.2 million in occupancy and $0.2 million in other non-interest expense, partially offset by decreases of $0.6 million in FDIC insurance expense and $0.1 million in professional services.

PROVISION FOR INCOME TAXES

The effective tax rate was 24.9 percent for the three months ended March 31, 2021 compared to 22.7 percent for the three months ended December 31, 2020 and 27.5 percent for the three months ended March 31, 2020.

RETURNS ON AVERAGE ASSETS AND AVERAGE EQUITY

The annualized return on average assets increased to 1.21 percent during the first quarter 2021 from 1.20 percent for the fourth quarter of 2020.

The annualized return on average stockholders' equity decreased to 11.18 percent during the first quarter of 2021 from 11.38 percent for the fourth quarter of 2020. The annualized return on average tangible stockholders’ equity decreased to 13.51 percent for the first quarter of 2021 from 13.79 percent for the fourth quarter of 2020.

DIVIDEND DECLARED

The Company’s Board of Directors approved a dividend of $0.12 per share for the quarter ended March 31, 2021, an increase of half a cent from the prior period. The dividend will be paid on May 28, 2021 to stockholders of record on May 14, 2021, representing an increase of 4.3 percent from the prior quarter.

CONFERENCE CALL

The Company will conduct a conference call/webcast at 1:30 PM Eastern Daylight Time on Thursday, April 29, 2021 to discuss the results for the quarter, business highlights and outlook. A copy of the Earnings Presentation is available on the Company’s website, www.brooklinebancorp.com. To listen to the call and view the Company’s Earnings Presentation, please join the call via https://services.choruscall.com/links/brkl210429.html. To listen to the call without access to the slides, interested parties may dial 877-504-4120 (United States) or 412-902-6650 (internationally) and ask for the Brookline Bancorp, Inc. conference call. A recorded playback of the call will be available for one week following the call on the Company’s website under “Investor Relations” or by dialing 877-344-7529 (United States) or 412-317-0088 (internationally) and entering the passcode: 10154349.

ABOUT BROOKLINE BANCORP, INC.

Brookline Bancorp, Inc., a bank holding company with $8.6 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, continued deterioration in employment levels, general business and economic conditions on a national basis and in the local markets in which the Company operates; 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
[email protected]