Press Release

Brookline Bancorp Announces Fourth Quarter Results

Company Release - 1/24/2024

Net Income of $22.9 million , EPS of $0.26

Quarterly Dividend of $0.135

BOSTON, Jan. 24, 2024 (GLOBE NEWSWIRE) -- Brookline Bancorp, Inc. (NASDAQ: BRKL) (the “Company”) today announced net income of $22.9 million, or $0.26 per basic and diluted share, for the fourth quarter of 2023, compared to $22.7 million, or $0.26 per basic and diluted share, for the third quarter of 2023, and $29.7 million, or $0.39 per basic and diluted share, for the fourth quarter of 2022.

For the year ended December 31, 2023, the Company reported net income of $75.0 million, or $0.85 per basic and diluted share, compared to $109.7 million, or $1.42 per basic and diluted share, for the year ended December 31, 2022. For the year ended December 31, 2023, the Company reported operating earnings of $92.9 million, or $1.05 per basic and diluted share, compared to $111.3 million, or $1.44 per basic and diluted share, for the year ended December 31, 2022.

Brookline Bancorp, Inc. CEO and Chairman Paul Perrault commented on 2023 performance, “Brookline Bancorp began the year by welcoming PCSB Bank customers and employees to our family of banks. I would like to thank our customers and the continued hard work and dedication of all our Company’s employees to our overall success in 2023. In 2023, our industry experienced challenging headwinds. As we enter 2024, we remain well positioned to take advantage of opportunities in the tremendous markets we serve.”

BALANCE SHEET

Total assets at December 31, 2023 increased $201.7 million to $11.4 billion from $11.2 billion at September 30, 2023, and increased $2.2 billion from $9.2 billion at December 31, 2022. At December 31, 2023, total loans and leases were $9.6 billion, representing an increase of $260.8 million from September 30, 2023, and an increase of $2.0 billion from December 31, 2022, primarily driven by the acquisition of PCSB Financial Corporation ("PCSB").

Total investment securities at December 31, 2023 increased $36.2 million to $916.6 million from $880.4 million at September 30, 2023, and increased $259.8 million from $656.8 million at December 31, 2022. Total cash and cash equivalents at December 31, 2023 decreased $28.0 million to $133.0 million from $161.0 million at September 30, 2023, and decreased $249.9 million from $383.0 million at December 31, 2022. As of December 31, 2023, total investment securities and total cash and cash equivalents represented 9.2 percent of total assets as compared to 9.3 percent and 11.3 percent as of September 30, 2023 and December 31, 2022, respectively.

Total deposits at December 31, 2023 decreased $17.9 million, $13.2 million of which was related to brokered deposits, to $8.5 billion from $8.6 billion at September 30, 2023 and increased $2.0 billion from $6.5 billion at December 31, 2022, primarily driven by the completion of the PCSB acquisition.

Total borrowed funds at December 31, 2023 increased $241.6 million to $1.4 billion from $1.1 billion at September 30, 2023, driven by the need to fund loan growth during the quarter, and decreased $56.0 million from $1.4 billion at December 31, 2022.

The ratio of stockholders’ equity to total assets was 10.53 percent at December 31, 2023, as compared to 10.36 percent at September 30, 2023, and 10.80 percent at December 31, 2022. The ratio of tangible stockholders’ equity to tangible assets (non-GAAP) was 8.39 percent at December 31, 2023, as compared to 8.16 percent at September 30, 2023, and 9.20 percent at December 31, 2022. Tangible book value per common share (non-GAAP) increased $0.48 from $10.02 at September 30, 2023 to $10.50 at December 31, 2023, compared to $10.80 at December 31, 2022.

NET INTEREST INCOME

Net interest income decreased $0.5 million to $83.6 million during the fourth quarter of 2023 from $84.1 million for the quarter ended September 30, 2023. The net interest margin decreased 3 basis points to 3.15 percent for the three months ended December 31, 2023 from 3.18 percent for the three months ended September 30, 2023, primarily driven by higher funding costs.

NON-INTEREST INCOME

Total non-interest income for the quarter ended December 31, 2023 increased $2.5 million to $8.0 million from $5.5 million for the quarter ended September 30, 2023. The increase was primarily driven by an increase of $2.0 million in other non-interest income, due to the mark to market on interest rate swaps, an increase of $0.4 million in loan level derivative income, net, and an increase of $0.2 million in gain on sales of loans and leases.

PROVISION FOR CREDIT LOSSES

The Company recorded a provision for credit losses of $3.8 million for the quarter ended December 31, 2023, compared to $3.0 million for the quarter ended September 30, 2023. The provision was driven by net charge-offs, an increase in specific reserves and strong loan growth, partially offset by a reduction in the unfunded reserve.

Total net charge-offs for the fourth quarter of 2023 were $7.1 million compared to $11.0 million in the third quarter of 2023, of which $4.5 million was previously reserved for. The $7.1 million in net charge-offs were driven by three individual charge-offs including a $3.3 million commercial loan, $1.0 million equipment financing loan, and a $0.9 million commercial real estate loan. The ratio of net loan and lease charge-offs to average loans and leases on an annualized basis decreased to 30 basis points for the fourth quarter of 2023 from 47 basis points for the third quarter of 2023.

The allowance for loan and lease losses represented 1.22 percent of total loans and leases at December 31, 2023, compared to 1.27 percent at September 30, 2023, and 1.29 percent at December 31, 2022. The decrease in ratio is driven by a change in loan mix consisting of a reduction in total construction commitments.

ASSET QUALITY

The ratio of total nonperforming loans and leases to total loans and leases was 0.45 percent at December 31, 2023 as compared to 0.55 percent at September 30, 2023. Total nonaccrual loans and leases decreased $7.6 million to $43.6 million at December 31, 2023 from $51.2 million at September 30, 2023. The ratio of nonperforming assets to total assets was 0.40 percent at December 31, 2023 as compared to 0.46 percent at September 30, 2023. Total nonperforming assets decreased $6.2 million to $45.3 million at December 31, 2023 from $51.5 million at September 30, 2023.

NON-INTEREST EXPENSE

Non-interest expense for the quarter ended December 31, 2023 increased $1.6 million to $59.2 million from $57.7 million for the quarter ended September 30, 2023. The increase was primarily driven by increases of $1.9 million in compensation and employee benefits and $0.5 million in equipment and data processing, partially offset by decreases of $0.9 million in professional services expense, $0.4 million in advertising and marketing expense, and $0.3 million in FDIC insurance expense.

PROVISION FOR INCOME TAXES

The effective tax rate was 19.9 percent and 20.1 percent for the three and twelve months ended December 31, 2023 compared to 21.4 percent for the three months ended September 30, 2023 and 17.8 percent and 21.6 percent for the three and twelve months ended December 31, 2022.

RETURNS ON AVERAGE ASSETS AND AVERAGE EQUITY

The annualized return on average assets was 0.81 percent during the fourth quarter of 2023 and flat compared to the third quarter of 2023; and was 0.67 percent for the year ended December 31, 2023, compared to 1.27 percent for the year ended December 31, 2022.

The annualized return on average tangible stockholders' equity increased to 10.12 percent during the fourth quarter of 2023 compared to 10.09 percent for the third quarter of 2023; and was 8.36 percent for the year ended December 31, 2023 compared to 13.35 percent for the year ended December 31, 2022.

DIVIDEND DECLARED

The Company’s Board of Directors approved a dividend of $0.135 per share for the quarter ended December 31, 2023. The dividend will be paid on February 23, 2024 to stockholders of record on February 9, 2024.

CONFERENCE CALL

The Company will conduct a conference call/webcast at 1:30 PM Eastern Time on Thursday, January 25, 2024 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://events.q4inc.com/attendee/124233277. To listen to the call without access to the slides, please dial 833-470-1428 (United States) or 404-975-4839 (internationally) and ask for the Brookline Bancorp, Inc. call (Access Code 714087). A recording of the call will be available for one week following the call on the Company’s website under “Investor Relations” or by dialing 866-813-9403 (United States) or 929-458-6194 (internationally) and entering the passcode: 419492.

ABOUT BROOKLINE BANCORP, INC.

Brookline Bancorp, Inc., a bank holding company with approximately $11.4 billion in assets and branch locations in eastern Massachusetts, Rhode Island and the Lower Hudson Valley of New York State, is headquartered in Boston, Massachusetts and operates as the holding company for Brookline Bank, Bank Rhode Island, and PCSB Bank. The Company provides commercial and retail banking services and cash management and investment services to customers throughout Central New England and the Lower Hudson Valley of New York State. More information about Brookline Bancorp, Inc. and its banks can be found at the following websites: www.brooklinebank.com, www.bankri.com and www.pcsb.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. We may also make forward-looking statements in other documents we file with the Securities and Exchange Commission ("SEC"), in our annual reports to shareholders, in press releases and other written materials, and in oral statements made by our officers, directors or employees. You can identify forward looking statements by the use of the words “believe,” “expect,” “anticipate,” “intend,” “estimate,” “assume,” “outlook,” “will,” “should,” and other expressions that predict or indicate future events and trends and which do not relate to historical matters, including statements regarding the Company’s business, credit quality, financial condition, liquidity and results of operations. Forward-looking statements 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 include, but are not limited to, changes in interest rates; general economic conditions (including inflation and concerns about liquidity) on a national basis or in the local markets in which the Company operates; turbulence in the capital and debt markets; competitive pressures from other financial institutions; changes in consumer behavior due to changing political, business and economic conditions, or legislative or regulatory initiatives; changes in the value of securities and other assets in the Company’s investment portfolio; increases in loan and lease default and charge-off rates; the adequacy of allowances for loan and lease losses; decreases in deposit levels that necessitate increases in borrowing to fund loans and investments; operational risks including, but not limited to, cybersecurity incidents, fraud, natural disasters, and future pandemics; changes in regulation; the possibility that future credit losses may be higher than currently expected due to changes in economic assumptions and adverse economic developments; the risk that goodwill and intangibles recorded in the Company’s financial statements will become impaired; and changes in assumptions used in making such forward-looking statements. 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 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 earnings per common share, operating return on average assets, operating return on average tangible assets, operating return on average stockholders' equity, operating return on average tangible stockholders' equity, 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.
  Co-President and Chief Financial and Strategy Officer
  (617) 425-5331
  ccarlson@brkl.com

 



BROOKLINE BANCORP, INC. AND SUBSIDIARIES
Selected Financial Highlights (Unaudited)
 
  At and for the Three Months Ended At and for the Twelve Months Ended
  December 31, 2023 September 30, 2023 June 30, 2023 March 31, 2023 December 31, 2022 December 31, 2023 December 31, 2022
  (Dollars In Thousands Except per Share Data)
Earnings Data:              
Net interest income $ 83,555   $ 84,070   $ 86,037   $ 86,049   $ 80,030   $ 339,711   $ 299,771  
Provision for credit losses on loans   3,851     2,947     5,726     25,344     5,671     37,868     8,525  
Provision (credit) for credit losses on investments   (76 )   84     133     198     54     339     102  
Non-interest income   8,027     5,508     5,462     12,937     9,056     31,934     28,347  
Non-interest expense   59,244     57,679     57,825     64,776     47,225     239,524     179,542  
Income before provision for income taxes   28,563     28,868     27,815     8,668     36,136     93,914     139,949  
Net income   22,888     22,701     21,850     7,560     29,695     74,999     109,744  
               
Performance Ratios:              
Net interest margin (1)   3.15 %   3.18 %   3.26 %   3.36 %   3.81 %   3.24 %   3.67 %
Interest-rate spread (1)   2.39 %   2.45 %   2.51 %   2.66 %   3.35 %   2.50 %   3.40 %
Return on average assets (annualized)   0.81 %   0.81 %   0.78 %   0.27 %   1.34 %   0.67 %   1.27 %
Return on average tangible assets (annualized) (non-GAAP)   0.83 %   0.83 %   0.79 %   0.28 %   1.37 %   0.69 %   1.30 %
Return on average stockholders' equity (annualized)   7.82 %   7.78 %   7.44 %   2.61 %   12.09 %   6.42 %   11.15 %
Return on average tangible stockholders' equity (annualized) (non-GAAP)   10.12 %   10.09 %   9.67 %   3.43 %   14.48 %   8.36 %   13.35 %
Efficiency ratio (2)   64.69 %   64.39 %   63.20 %   65.44 %   53.01 %   64.45 %   54.72 %
               
Per Common Share Data:              
Net income — Basic $ 0.26   $ 0.26   $ 0.25   $ 0.09   $ 0.39   $ 0.85   $ 1.42  
Net income — Diluted   0.26     0.26     0.25     0.09     0.39     0.85     1.42  
Cash dividends declared   0.135     0.135     0.135     0.135     0.135     0.540     0.530  
Book value per share (end of period)   13.48     13.03     13.11     13.14     12.91     13.48     12.91  
Tangible book value per common share (end of period) (non-GAAP)   10.50     10.02     10.07     10.08     10.80     10.50     10.80  
Stock price (end of period)   10.91     9.11     8.74     10.50     14.15     10.91     14.15  
               
Balance Sheet:              
Total assets $ 11,382,256   $ 11,180,555   $ 11,206,078   $ 11,522,485   $ 9,185,836   $ 11,382,256   $ 9,185,836  
Total loans and leases   9,641,589     9,380,782     9,340,799     9,246,965     7,644,388     9,641,589     7,644,388  
Total deposits   8,548,125     8,566,013     8,517,013     8,456,462     6,522,146     8,548,125     6,522,146  
Total stockholders’ equity   1,198,644     1,157,871     1,162,308     1,165,066     992,125     1,198,644     992,125  
               
Asset Quality:              
Nonperforming assets $ 45,324   $ 51,540   $ 46,925   $ 28,962   $ 15,302   $ 45,324   $ 15,302  
Nonperforming assets as a percentage of total assets   0.40 %   0.46 %   0.42 %   0.25 %   0.17 %   0.40 %   0.17 %
Allowance for loan and lease losses $ 117,522   $ 119,081   $ 125,817   $ 120,865   $ 98,482   $ 117,522   $ 98,482  
Allowance for loan and lease losses as a percentage of total loans and leases   1.22 %   1.27 %   1.35 %   1.31 %   1.29 %   1.22 %   1.29 %
Net loan and lease charge-offs $ 7,141   $ 10,974   $ 1,097   $ 451   $ 310   $ 19,663   $ 3,320  
Net loan and lease charge-offs as a percentage of average loans and leases (annualized)   0.30 %   0.47 %   0.05 %   0.02 %   0.02 %   0.21 %   0.05 %
               
Capital Ratios:              
Stockholders’ equity to total assets   10.53 %   10.36 %   10.37 %   10.11 %   10.80 %   10.53 %   10.80 %
Tangible stockholders’ equity to tangible assets (non-GAAP)   8.39 %   8.16 %   8.16 %   7.94 %   9.20 %   8.39 %   9.20 %
               
(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)
    December 31, 2023   September 30, 2023   June 30, 2023   March 31, 2023   December 31, 2022
ASSETS (In Thousands Except Share Data)  
Cash and due from banks $  34,514 $ 33,506 $ 44,323 $ 30,782 $ 191,767
Short-term investments   98,513   127,495   180,109   455,538   191,192
Total cash and cash equivalents   133,027   161,001   224,432   486,320   382,959
Investment securities available-for-sale   916,601   880,412   910,210   1,067,032   656,766
Total investment securities   916,601   880,412   910,210   1,067,032   656,766
Allowance for investment security losses   (441)   (517)   (433)   (301)   (102)
Net investment securities   916,160   879,895   909,777   1,066,731   656,664
Loans and leases:                    
Commercial real estate loans   5,764,529   5,669,768   5,670,771   5,610,414   4,404,148
Commercial loans and leases   2,399,668   2,241,375   2,193,027   2,147,149   2,016,499
Consumer loans   1,477,392   1,469,639   1,477,001   1,489,402   1,223,741
Total loans and leases   9,641,589   9,380,782   9,340,799   9,246,965   7,644,388
Allowance for loan and lease losses   (117,522)   (119,081)   (125,817)   (120,865)   (98,482)
Net loans and leases   9,524,067   9,261,701   9,214,982   9,126,100   7,545,906
Restricted equity securities   77,595   65,460   71,421   86,230   71,307
Premises and equipment, net of accumulated depreciation   89,853   90,476   90,685   87,799   71,391
Right-of-use asset operating leases   30,863   31,619   31,774   30,067   19,484
Deferred tax asset   56,952   74,491   77,704   75,028   52,237
Goodwill   241,222   241,222   241,222   241,222   160,427
Identified intangible assets, net of accumulated amortization   24,207   26,172   28,126   30,080   1,781
Other real estate owned and repossessed assets   1,694   299   602   508   408
Other assets   286,616   348,219   315,353   292,400   223,272
Total assets $ 11,382,256 $ 11,180,555 $ 11,206,078 $ 11,522,485 $ 9,185,836
LIABILITIES AND STOCKHOLDERS' EQUITY                    
Deposits:                    
Demand checking accounts $ 1,678,406 $ 1,745,137 $ 1,843,516 $ 1,899,370 $ 1,802,518
NOW accounts   661,863   647,476   699,119   757,411   544,118
Savings accounts   1,669,018   1,625,804   1,464,054   1,268,375   762,271
Money market accounts   2,082,810   2,161,359   2,166,570   2,185,971   2,174,952
Certificate of deposit accounts   1,574,855   1,491,844   1,410,905   1,362,970   928,143
Brokered deposit accounts   881,173   894,393   932,849   982,365   310,144
Total deposits   8,548,125   8,566,013   8,517,013   8,456,462   6,522,146
Borrowed funds:                    
Advances from the FHLBB   1,223,226   899,304   1,043,381   1,458,457   1,237,823
Subordinated debentures and notes   84,188   84,152   84,116   84,080   84,044
Other borrowed funds   69,256   151,612   98,773   87,565   110,785
Total borrowed funds   1,376,670   1,135,068   1,226,270   1,630,102   1,432,652
Operating lease liabilities   31,998   32,807   33,021   31,373   19,484
Mortgagors’ escrow accounts   17,239   12,578   17,207   17,080   5,607
Reserve for unfunded credits   19,767   21,497   22,789   23,112   20,602
Accrued expenses and other liabilities   189,813   254,721   227,470   199,290   193,220
Total liabilities   10,183,612   10,022,684   10,043,770   10,357,419   8,193,711
Stockholders' equity:                    
Common stock, $0.01 par value; 200,000,000 shares authorized; 96,998,075 shares issued, 96,998,075 shares issued, 96,998,075 shares issued, 96,998,075 shares issued, and 85,177,172 shares issued, respectively   970   970   970   970   852
Additional paid-in capital   902,659   901,376   905,084   904,174   736,074
Retained earnings   438,722   427,937   417,328   407,528   412,019
Accumulated other comprehensive income   (52,798)   (81,541)   (66,156)   (52,688)   (61,947)
Treasury stock, at cost;                    
7,354,399 shares, 7,350,981 shares, 7,734,891 shares, 7,734,891 shares, and 7,731,445 shares, respectively   (90,909)   (90,871)   (94,918)   (94,918)   (94,873)
Total stockholders' equity   1,198,644   1,157,871   1,162,308   1,165,066   992,125
Total liabilities and stockholders' equity $ 11,382,256 $ 11,180,555 $ 11,206,078 $ 11,522,485 $ 9,185,836
                     



BROOKLINE BANCORP, INC. AND SUBSIDIARIES
Consolidated Statements of Income (Unaudited)
  Three Months Ended
  December 31, 2023 September 30, 2023 June 30, 2023 March 31, 2023 December 31, 2022
  (In Thousands Except Share Data)
Interest and dividend income:          
Loans and leases $ 142,948   $ 136,561 $ 132,299 $ 121,931 $ 98,386
Debt securities   6,945     6,799   8,034   7,870   3,497
Restricted equity securities   1,333     1,310   1,673   1,255   766
Short-term investments   1,093     2,390   3,351   1,495   754
Total interest and dividend income   152,319     147,060   145,357   132,551   103,403
Interest expense:          
Deposits   54,034     49,116   43,147   29,368   14,185
Borrowed funds   14,730     13,874   16,173   17,134   9,188
Total interest expense   68,764     62,990   59,320   46,502   23,373
Net interest income   83,555     84,070   86,037   86,049   80,030
Provision for credit losses on loans   3,851     2,947   5,726   25,344   5,671
(Credit) provision for credit losses on investments   (76 )   84   133   198   54
Net interest income after provision for credit losses   79,780     81,039   80,178   60,507   74,305
Non-interest income:          
Deposit fees   3,064     3,024   2,866   2,657   2,916
Loan fees   515     639   491   391   446
Loan level derivative income, net   778     376   363   2,373   670
Gain on investment securities, net         3   1,701   321
Gain on sales of loans and leases   410     225   308   1,638   2,612
Other   3,260     1,244   1,431   4,177   2,091
Total non-interest income   8,027     5,508   5,462   12,937   9,056
Non-interest expense:          
Compensation and employee benefits   35,401     33,491   33,438   36,565   29,525
Occupancy   5,127     4,983   4,870   5,223   4,005
Equipment and data processing   7,245     6,766   6,531   6,462   5,758
Professional services   1,442     2,368   1,986   1,430   1,546
FDIC insurance   1,839     2,152   2,609   1,244   1,001
Advertising and marketing   758     1,174   1,382   1,410   1,052
Amortization of identified intangible assets   1,965     1,955   1,954   1,966   120
Merger and acquisition expense         1,002   6,409   641
Other   5,467     4,790   4,053   4,067   3,577
Total non-interest expense   59,244     57,679   57,825   64,776   47,225
Income before provision for income taxes   28,563     28,868   27,815   8,668   36,136
Provision for income taxes   5,675     6,167   5,965   1,108   6,441
Net income $ 22,888   $ 22,701 $ 21,850 $ 7,560 $ 29,695
Earnings per common share:          
Basic $ 0.26   $ 0.26 $ 0.25 $ 0.09 $ 0.39
Diluted $ 0.26   $ 0.26 $ 0.25 $ 0.09 $ 0.39
Weighted average common shares outstanding during the period:        
Basic   88,867,159     88,795,270   88,665,135   86,563,641   76,841,655
Diluted   89,035,505     88,971,210   88,926,543   86,837,806   77,065,076
Dividends paid per common share $ 0.135   $ 0.135 $ 0.135 $ 0.135 $ 0.135
           



BROOKLINE BANCORP, INC. AND SUBSIDIARIES
Consolidated Statements of Income (Unaudited)
   
  Twelve Months Ended December 31,
    2023   2022
  (In Thousands Except Share Data)
Interest and dividend income:    
Loans and leases $ 533,739 $ 328,769
Debt securities   29,648   13,079
Restricted equity securities   5,571   1,898
Short-term investments   8,329   1,440
Total interest and dividend income   577,287   345,186
Interest expense:    
Deposits   175,665   29,592
Borrowed funds   61,911   15,823
Total interest expense   237,576   45,415
Net interest income   339,711   299,771
Provision for credit losses on loans   37,868   8,525
Provision for credit losses on investments   339   102
Net interest income after provision for credit losses   301,504   291,144
Non-interest income:    
Deposit fees   11,611   10,919
Loan fees   2,036   2,208
Loan level derivative income, net   3,890   4,246
Gain on investment securities, net   1,704   321
Gain on sales of loans and leases   2,581   4,136
Other   10,112   6,517
Total non-interest income   31,934   28,347
Non-interest expense:    
Compensation and employee benefits   138,895   113,487
Occupancy   20,203   16,002
Equipment and data processing   27,004   20,833
Professional services   7,226   5,060
FDIC insurance   7,844   3,177
Advertising and marketing   4,724   4,980
Amortization of identified intangible assets   7,840   494
Merger and acquisition expense   7,411   2,249
Other   18,377   13,260
Total non-interest expense   239,524   179,542
Income before provision for income taxes   93,914   139,949
Provision for income taxes   18,915   30,205
Net income $ 74,999 $ 109,744
Earnings per common share:    
Basic $ 0.85 $ 1.42
Diluted $ 0.85 $ 1.42
Weighted average common shares outstanding during the period:  
Basic   88,230,681   77,079,278
Diluted   88,450,646   77,351,834
Dividends paid per common share $ 0.540 $ 0.520
     



BROOKLINE BANCORP, INC. AND SUBSIDIARIES
Asset Quality Analysis (Unaudited)
  At and for the Three Months Ended
  December 31, 2023 September 30, 2023 June 30, 2023 March 31, 2023 December 31, 2022
  (Dollars in Thousands)
NONPERFORMING ASSETS:          
Loans and leases accounted for on a nonaccrual basis:          
Commercial real estate mortgage $ 19,608   $ 23,263   $ 8,737   $ 4,589   $ 607  
Multi-family mortgage       1,318              
Construction       2,316     3,828     3,883     707  
Total commercial real estate loans   19,608     26,897     12,565     8,472     1,314  
           
Commercial   3,886     5,406     16,023     5,495     464  
Equipment financing   14,984     13,974     12,809     9,908     9,653  
Condominium association               51     58  
Total commercial loans and leases   18,870     19,380     28,832     15,454     10,175  
           
Residential mortgage   4,292     4,249     4,343     3,449     2,680  
Home equity   860     713     583     1,079     723  
Other consumer       2             2  
Total consumer loans   5,152     4,964     4,926     4,528     3,405  
           
Total nonaccrual loans and leases   43,630     51,241     46,323     28,454     14,894  
           
Other real estate owned   780                  
Other repossessed assets   914     299     602     508     408  
Total nonperforming assets $ 45,324   $ 51,540   $ 46,925   $ 28,962   $ 15,302  
           
Loans and leases past due greater than 90 days and still accruing $ 228   $ 1,175   $ 490   $ 726   $ 33  
           
Nonperforming loans and leases as a percentage of total loans and leases   0.45 %   0.55 %   0.50 %   0.31 %   0.19 %
Nonperforming assets as a percentage of total assets   0.40 %   0.46 %   0.42 %   0.25 %   0.17 %
           
PROVISION AND ALLOWANCE FOR LOAN AND LEASE LOSSES:      
Allowance for loan and lease losses at beginning of period $ 119,081   $ 125,817   $ 120,865   $ 98,482   $ 94,169  
Charge-offs   (7,722 )   (10,978 )   (1,690 )   (845 )   (658 )
Recoveries   581     4     593     394     348  
Net charge-offs   (7,141 )   (10,974 )   (1,097 )   (451 )   (310 )
Provision for loan and lease losses excluding unfunded commitments *   5,582     4,238     6,049     22,834     4,623  
Allowance for loan and lease losses at end of period $ 117,522   $ 119,081   $ 125,817   $ 120,865   $ 98,482  
           
Allowance for loan and lease losses as a percentage of total loans and leases   1.22 %   1.27 %   1.35 %   1.31 %   1.29 %
           
NET CHARGE-OFFS:          
Commercial real estate loans $ 1,087   $ (3 ) $ (6 ) $ (6 ) $ (6 )
Commercial loans and leases   6,061     10,958     1,108     457     320  
Consumer loans   (7 )   19     (5 )       (4 )
Total net charge-offs $ 7,141   $ 10,974   $ 1,097   $ 451   $ 310  
           
Net loan and lease charge-offs as a percentage of average loans and leases (annualized)   0.30 %   0.47 %   0.05 %   0.02 %   0.02 %
           
*Provision for loan and lease losses does not include (credit) provision of $(1.7 million), $(1.3 million), $(0.3) million, $2.5 million, and $1.0 million for credit losses on unfunded commitments during the three months ended December 31, 2023, September 30, 2023, June 30, 2023, March 31, 2023, and December 31, 2022, respectively.          
           



BROOKLINE BANCORP, INC. AND SUBSIDIARIES
Average Yields / Costs (Unaudited)
  Three Months Ended
  December 31, 2023 September 30, 2023 December 31, 2022
  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) $ 876,350 $ 6,986 3.19 % $ 887,612 $ 6,840 3.08 % $ 665,969 $ 3,497 2.10 %
Restricted equity securities (2)   67,567   1,334 7.90 %   67,824   1,310 7.73 %   52,093   766 5.88 %
Short-term investments   85,790   1,093 5.09 %   172,483   2,390 5.54 %   60,385   754 5.00 %
Total investments   1,029,707   9,413 3.66 %   1,127,919   10,540 3.74 %   778,447   5,017 2.58 %
Loans and Leases:                  
Commercial real estate loans (3)   5,727,930   81,653 5.58 %   5,667,373   78,750 5.44 %   4,341,929   53,088 4.78 %
Commercial loans (3)   969,603   16,296 6.58 %   939,492   15,295 6.38 %   797,312   10,541 5.18 %
Equipment financing (3)   1,347,589   25,211 7.48 %   1,280,033   23,331 7.29 %   1,200,911   20,816 6.93 %
Consumer loans (3)   1,475,580   19,888 5.37 %   1,471,985   19,237 5.21 %   1,225,056   13,991 4.55 %
Total loans and leases   9,520,702   143,048 6.01 %   9,358,883   136,613 5.84 %   7,565,208   98,436 5.20 %
Total interest-earning assets   10,550,409   152,461 5.78 %   10,486,802   147,153 5.61 %   8,343,655   103,453 4.96 %
Non-interest-earning assets   721,532       693,833       513,976    
Total assets $ 11,271,941     $ 11,180,635     $ 8,857,631    
                   
Liabilities and Stockholders' Equity:                  
Interest-bearing liabilities:                  
Deposits:                  
NOW accounts $ 657,134   1,146 0.69 % $ 681,929   1,159 0.67 % $ 583,499   257 0.18 %
Savings accounts   1,658,144   10,684 2.56 %   1,557,911   8,859 2.26 %   787,021   1,155 0.58 %
Money market accounts   2,140,225   16,239 3.01 %   2,177,528   15,785 2.88 %   2,282,217   7,711 1.34 %
Certificates of deposit   1,530,772   14,517 3.76 %   1,444,269   12,128 3.33 %   922,250   2,865 1.23 %
Brokered deposit accounts   880,604   11,448 5.16 %   882,351   11,185 5.03 %   218,188   2,197 3.99 %
Total interest-bearing deposits   6,866,879   54,034 3.12 %   6,743,988   49,116 2.89 %   4,793,175   14,185 1.17 %
Borrowings:                  
Advances from the FHLBB   965,846   11,943 4.84 %   954,989   11,706 4.80 %   736,652   6,979 3.71 %
Subordinated debentures and notes   84,170   1,381 6.56 %   84,134   1,378 6.55 %   84,025   1,332 6.34 %
Other borrowed funds   136,566   1,406 4.09 %   117,531   790 2.67 %   148,195   877 2.35 %
Total borrowings   1,186,582   14,730 4.86 %   1,156,654   13,874 4.69 %   968,872   9,188 3.71 %
Total interest-bearing liabilities   8,053,461   68,764 3.39 %   7,900,642   62,990 3.16 %   5,762,047   23,373 1.61 %
Non-interest-bearing liabilities:                  
Demand checking accounts   1,723,849       1,794,225       1,843,780    
Other non-interest-bearing liabilities   323,855       318,041       269,498    
Total liabilities   10,101,165       10,012,908       7,875,325    
Stockholders’ equity   1,170,776       1,167,727       982,306    
Total liabilities and equity $ 11,271,941     $ 11,180,635     $ 8,857,631    
Net interest income (tax-equivalent basis) /Interest-rate spread (4)     83,697 2.39 %     84,163 2.45 %     80,080 3.35 %
Less adjustment of tax-exempt income     142       93       50  
Net interest income   $ 83,555     $ 84,070     $ 80,030  
Net interest margin (5)     3.15 %     3.18 %     3.81 %
                   
(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.
                   



BROOKLINE BANCORP, INC. AND SUBSIDIARIES
Average Yields / Costs (Unaudited)
  Twelve Months Ended
  December 31, 2023 December 31, 2022
  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) $ 947,782 $ 29,891 3.15 % $ 706,580 $ 13,079 1.85 %
Restricted equity securities (2)   72,264   5,572 7.71 %   36,813   1,898 5.15 %
Short-term investments   158,718   8,329 5.25 %   104,288   1,440 1.38 %
Total investments   1,178,764   43,792 3.72 %   847,681   16,417 1.94 %
Loans and Leases:            
Commercial real estate loans (3)   5,654,385   307,652 5.37 %   4,238,960   172,811 4.02 %
Commercial loans (3)   929,077   59,110 6.28 %   744,972   34,105 4.52 %
Equipment financing (3)   1,277,224   92,112 7.21 %   1,148,673   75,767 6.60 %
Consumer loans (3)   1,470,677   75,098 5.10 %   1,199,804   46,295 3.86 %
Total loans and leases   9,331,363   533,972 5.72 %   7,332,409   328,978 4.49 %
Total interest-earning assets   10,510,127   577,764 5.50 %   8,180,090   345,395 4.22 %
Non-interest-earning assets   704,244       443,313    
Total assets $ 11,214,371     $ 8,623,403    
             
Liabilities and Stockholders' Equity:            
Interest-bearing liabilities:            
Deposits:            
NOW accounts $ 720,572   4,275 0.59 % $ 598,267   853 0.14 %
Savings accounts   1,439,293   27,974 1.94 %   882,881   2,228 0.25 %
Money market accounts   2,205,430   58,153 2.64 %   2,387,670   15,392 0.64 %
Certificates of deposit   1,428,727   44,122 3.09 %   998,580   8,210 0.82 %
Brokered deposit accounts   819,419   41,141 5.02 %   146,038   2,909 1.99 %
Total interest-bearing deposits   6,613,441   175,665 2.66 %   5,013,436   29,592 0.59 %
Borrowings:            
Advances from the FHLBB   1,092,996   52,467 4.73 %   340,569   9,355 2.71 %
Subordinated debentures and notes   84,116   5,476 6.51 %   83,971   5,133 6.11 %
Other borrowed funds   124,793   3,968 3.18 %   118,383   1,335 1.13 %
Total borrowings   1,301,905   61,911 4.69 %   542,923   15,823 2.87 %
Total interest-bearing liabilities   7,915,346   237,576 3.00 %   5,556,359   45,415 0.82 %
Non-interest-bearing liabilities:            
Demand checking accounts   1,823,759       1,879,620    
Other non-interest-bearing liabilities   307,160       203,187    
Total liabilities   10,046,265       7,639,166    
Stockholders’ equity   1,168,106       984,237    
Total liabilities and equity $ 11,214,371     $ 8,623,403    
Net interest income (tax-equivalent basis) /Interest-rate spread (4)     340,188 2.50 %     299,980 3.40 %
Less adjustment of tax-exempt income     477       209  
Net interest income   $ 339,711     $ 299,771  
Net interest margin (5)     3.24 %     3.67 %
             
(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.
             



BROOKLINE BANCORP, INC. AND SUBSIDIARIES
Non-GAAP Financial Information (Unaudited)
      At and for the Three Months Ended
December 31,
At and for the Twelve Months Ended
December 31,
          2023     2022     2023     2022  
Reconciliation Table - Non-GAAP Financial Information   (Dollars in Thousands Except Share Data)
             
Reported Pretax Income     $ 28,563   $ 36,136   $ 93,914   $ 139,949  
Less:              
Security gains       321     1,704     321  
Add:              
Day 1 PCSB CECL provision                 16,744      
Merger and acquisition expenses         641     7,411     2,249  
Operating Pretax income   $ 28,563   $ 36,456   $ 116,365   $ 141,877  
Effective tax rate     19.9 %   17.8 %   20.1 %   21.6 %
Provision for income tax     5,675     6,498     23,437     30,622  
Operating earnings       $ 22,888   $ 29,958   $ 92,928   $ 111,255  
               
Operating earnings per common share:            
Basic       $ 0.26   $ 0.39   $ 1.05   $ 1.44  
Diluted       $ 0.26   $ 0.39   $ 1.05   $ 1.44  
               
Weighted average common shares outstanding during the period:          
Basic         88,867,159     76,841,655     88,230,681     77,079,278  
Diluted         89,035,505     77,065,076     88,450,646     77,351,834  
               
               
Return on average assets *       0.81 %   1.34 %   0.67 %   1.27 %
Less:              
Security gains (after-tax) *       %   0.01 %   0.01 %   %
Add:              
Day 1 PCSB CECL provision (after-tax) *     %   %   0.12 %   %
Merger and acquisition expenses (after-tax) *     %   0.02 %   0.05 %   0.02 %
Operating return on average assets *       0.81 %   1.35 %   0.83 %   1.29 %
               
               
Return on average tangible assets *       0.83 %   1.37 %   0.69 %   1.30 %
Less:              
Security gains (after-tax) *       %   0.01 %   0.01 %   %
Add:              
Day 1 PCSB CECL provision (after-tax) *     %   %   0.12 %   %
Merger and acquisition expenses (after-tax) *     %   0.02 %   0.05 %   0.02 %
Operating return on average tangible assets *       0.83 %   1.38 %   0.85 %   1.32 %
               
               
Return on average stockholders' equity *       7.82 %   12.09 %   6.42 %   11.15 %
Less:              
Security gains (after-tax) *       %   0.11 %   0.12 %   0.03 %
Add:              
Day 1 PCSB CECL provision (after-tax) *     %   %   1.14 %   %
Merger and acquisition expenses (after-tax) *     %   0.21 %   0.51 %   0.18 %
Operating return on average stockholders' equity *     7.82 %   12.19 %   7.95 %   11.30 %
               
               
Return on average tangible stockholders' equity *     10.12 %   14.48 %   8.36 %   13.35 %
Less:              
Security gains (after-tax) *       %   0.13 %   0.15 %   0.03 %
Add:              
Day 1 PCSB CECL provision (after-tax) *     %   %   1.49 %   %
Merger and acquisition expenses (after-tax) *     %   0.26 %   0.66 %   0.21 %
Operating return on average tangible stockholders' equity *     10.12 %   14.61 %   10.36 %   13.53 %
* Ratios at and for the three months ended are annualized.          
               
BROOKLINE BANCORP, INC. AND SUBSIDIARIES
Non-GAAP Financial Information (Unaudited)
  At and for the Three Months Ended At and for the Twelve
Months Ended
  December 31, 2023 September 30, 2023 June 30, 2023 March 31, 2023 December 31, 2022 December 31, 2023 December 31, 2022
  (Dollars in Thousands)
               
Net income, as reported $ 22,888   $ 22,701   $ 21,850   $ 7,560   $ 29,695   $ 74,999   $ 109,744  
               
Average total assets $ 11,271,941   $ 11,180,635   $ 11,272,672   $ 11,131,087   $ 8,857,631   $ 11,214,371   $ 8,623,403  
Less: Average goodwill and average identified intangible assets, net   266,225     268,199     270,147     278,135     162,266     270,637     162,447  
Average tangible assets $ 11,005,716   $ 10,912,436   $ 11,002,525   $ 10,852,952   $ 8,695,365   $ 10,943,734   $ 8,460,956  
               
Return on average tangible assets (annualized)   0.83 %   0.83 %   0.79 %   0.28 %   1.37 %   0.69 %   1.30 %
               
Average total stockholders’ equity $ 1,170,776   $ 1,167,727   $ 1,174,167   $ 1,159,635   $ 982,306   $ 1,168,106   $ 984,237  
Less: Average goodwill and average identified intangible assets, net   266,225     268,199     270,147     278,135     162,266     270,637     162,447  
Average tangible stockholders’ equity $ 904,551   $ 899,528   $ 904,020   $ 881,500   $ 820,040   $ 897,469   $ 821,790  
               
Return on average tangible stockholders’ equity (annualized)   10.12 %   10.09 %   9.67 %   3.43 %   14.48 %   8.36 %   13.35 %
               
Total stockholders’ equity $ 1,198,644   $ 1,157,871   $ 1,162,308   $ 1,165,066   $ 992,125   $ 1,198,644   $ 992,125  
Less:              
Goodwill   241,222     241,222     241,222     241,222     160,427     241,222     160,427  
Identified intangible assets, net   24,207     26,172     28,126     30,080     1,781     24,207     1,781  
Tangible stockholders' equity $ 933,215   $ 890,477   $ 892,960   $ 893,764   $ 829,917   $ 933,215   $ 829,917  
               
Total assets $ 11,382,256   $ 11,180,555   $ 11,206,078   $ 11,522,485   $ 9,185,836   $ 11,382,256   $ 9,185,836  
Less:              
Goodwill   241,222     241,222     241,222     241,222     160,427     241,222     160,427  
Identified intangible assets, net   24,207     26,172     28,126     30,080     1,781     24,207     1,781  
Tangible assets $ 11,116,827   $ 10,913,161   $ 10,936,730   $ 11,251,183   $ 9,023,628   $ 11,116,827   $ 9,023,628  
               
Tangible stockholders’ equity to tangible assets   8.39 %   8.16 %   8.16 %   7.94 %   9.20 %   8.39 %   9.20 %
               
Tangible stockholders' equity $ 933,215   $ 890,477   $ 892,960   $ 893,764   $ 829,917   $ 933,215   $ 829,917  
               
Number of common shares issued   96,998,075     96,998,075     96,998,075     96,998,075     85,177,172     96,998,075     85,177,172  
Less:              
Treasury shares   7,354,399     7,350,981     7,734,891     7,734,891     7,731,445     7,354,399     7,731,445  
Unvested restricted shares   749,099     780,859     598,049     598,049     601,495     749,099     601,495  
Number of common shares outstanding   88,894,577     88,866,235     88,665,135     88,665,135     76,844,232     88,894,577     76,844,232  
               
Tangible book value per common share $ 10.50   $ 10.02   $ 10.07   $ 10.08   $ 10.80   $ 10.50   $ 10.80  
               

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Source: Brookline Bancorp, Inc.