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BROOKLINE BANCORP INC
Symbol U : BRKL
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Brookline Bancorp Announces Fourth Quarter Net Income of $11.9 Million, EPS of $0.17

2013-01-30 17:39 ET - News Release

Solid Organic Loan and Deposit Growth Continues

Business Fundamentals Remain Strong


Company Website: http://www.brooklinebank.com
BOSTON -- (Business Wire)

Brookline Bancorp, Inc. (NASDAQ: BRKL) (the “Company”) today announced net income of $11.9 million, or $0.17 per basic and diluted share, for the fourth quarter of 2012, compared to $7.1 million, or $0.12 per basic and diluted share, for the fourth quarter of 2011, and $11.4 million, or $0.16 per basic and diluted share, for the third quarter of 2012.

For the year ended December 31, 2012, net income totaled $37.1 million, or $0.53 per basic and diluted share, compared to $27.6 million, or $0.47 per basic and diluted share, for 2011. Operating earnings were $41.1 million, or $0.59 per basic and diluted share, for the year ended December 31, 2012, compared to $28.9 million, or $0.49 per basic and diluted share, for 2011.

Paul Perrault, President and Chief Executive Officer of Brookline Bancorp, Inc., stated: “Our strong fourth quarter and 2012 results reflect the significant progress we have made in carrying out our primary business objectives. We continue to generate strong loan growth while maintaining our traditionally strong asset quality. At the same time, we are also continuing to enhance our infrastructure to support this growth.”

BALANCE SHEET

Total assets at December 31, 2012 grew to $5.15 billion, an annualized increase of 6.8 percent from the prior quarter and 4.9 percent from December 31, 2011 after adjustment for the $1.69 billion of total assets acquired from Bancorp Rhode Island, Inc. on January 1, 2012.

The loan and lease portfolio grew to $4.18 billion as of December 31, 2012, up 3.1 percent annualized from the prior quarter and 11.8 percent from December 31, 2011, after adjustment for the $1.14 billion in loans and leases acquired from Bancorp Rhode Island on January 1, 2012. Strong organic loan growth continued in the commercial loan and lease and commercial real estate portfolios, which reached $2.85 billion, or 68.3 percent of total loans, at December 31, 2012. The commercial loan and lease and commercial real estate portfolios increased to $2.05 billion, an increase of 19.6 percent for the full year 2012 after adjustment for the $803.0 million in commercial loan and lease and commercial real estate portfolios acquired from Bancorp Rhode Island. The commercial loan and lease portfolio increased 14.9 percent and the commercial real estate portfolio increased 5.9 percent on an annualized basis during the fourth quarter 2012. The indirect automobile portfolio decreased $31.9 million from September 30, 2012 to December 31, 2012, as anticipated, reflecting significant paydowns on the portfolio and the continuing pricing pressures in the auto lending market.

Deposits of $3.62 billion at December 31, 2012 were up 5.4 percent annualized from September 30, 2012 and 10.2 percent from December 31, 2011 after exclusion of the $1.13 billion of deposits acquired from Bancorp Rhode Island. This growth was fueled by increases in NOW accounts and demand checking accounts which grew at an annualized rate of 64.1 percent and 22.4 percent during the quarter ended December 31, 2012, respectively. Core deposits, which increased from 70.8 percent to 72.0 percent of deposits quarter-to-quarter, increased 12.6 percent annualized in the fourth quarter 2012. Total borrowings increased 12.4 percent on an annualized basis to $854.0 million at December 31, 2012.

Cash and cash equivalents were $117.1 million as of December 31, 2012 as compared to $76.3 million as of September 30, 2012. The increase during the fourth quarter 2012 was related largely to the timing of cash items due to the Company at December 31, 2012 that cleared in January 2013. Investment securities available-for-sale of $481.3 million also increased 12.4 percent from September 30, 2012 to December 31, 2012 on an annualized basis, with total investment securities at 10.7 percent of total assets.

Stockholders’ equity to total assets was 11.89 percent at December 31, 2012. The tangible stockholders’ equity to tangible assets ratio remained constant at 9.08 percent at December 31, 2012 when compared with 9.08 percent at September 30, 2012 and decreased from 13.93 percent at December 31, 2011 as a result of Brookline Bancorp’s acquisition of Bancorp Rhode Island.

NET INTEREST INCOME

Net interest income for the fourth quarter 2012 decreased $1.8 million to $44.6 million from $46.4 million in the third quarter of 2012. The decrease in interest income on commercial loans and leases from the third quarter 2012 was largely a result of a nonrecurring $1.4 million of yield adjustments recorded in the quarter ended September 30, 2012. The remaining decrease in interest income on loans and leases was largely driven by continued rate pressures in the economic environment and decreases in interest rates that were partially offset by strong growth across various loan and lease portfolios. Interest expense decreased $0.6 million in the fourth quarter 2012 as compared to the third quarter 2012, largely as a result of decreased FHLB borrowing costs and a decrease in the interest rates associated with core deposits. Net interest income for the year ended December 31, 2012 increased to $177.4 million from $110.2 million in the year ended December 31, 2011.

Net interest margin for the fourth quarter 2012 was 3.79 percent, down from 4.00 percent at September 30, 2012, but only slightly less than third quarter 2012 net interest margin of 3.86 after excluding the $1.4 million of periodic yield adjustments recorded in accordance with GAAP. Net interest margin was up slightly from 3.78 percent for the quarter ended December 31, 2011. Strong loan growth in the majority of the Company’s loan portfolios and a slight decrease in the cost of borrowing were offset by continued rate pressures on the commercial loan and lease and other consumer loan portfolios.

NON-INTEREST INCOME

Non-interest income was $6.5 million for the fourth quarter 2012, up $2.7 million from the third quarter 2012. The increase in non-interest income as compared to the third quarter is primarily due to a $1.9 million gain on a sale of equipment leases totaling $19.6 million during the quarter undertaken to manage concentration risk.

Non-interest income was $18.6 million for the year ended December 31, 2012, up $13.5 million from the year ended December 31, 2011. The growth in 2012 was primarily driven by $13.0 million in non-interest income attributable to Bancorp Rhode Island.

NON-INTEREST EXPENSE AND TAX PROVISION

Non-interest expense of $28.9 million in the fourth quarter 2012 decreased $1.6 million from the third quarter 2012. Significant changes in non-interest expense included the following:

  • Compensation and employee benefit expense increased $1.0 million, or 7.1 percent during the fourth quarter 2012, as a result of the addition of loan officers and other individuals in key support areas of the Company. The increase in compensation and employee benefit expense was offset by a $0.4 million decrease in professional services expense.
  • Equipment and data processing expense decreased $0.9 million, or 21.1 percent as a result of the reduction in conversion costs incurred in conjunction with Brookline Bank’s core system conversion.
  • The increase in other expenses in the third quarter as compared to the fourth quarter is associated with the Company’s continued migration to standardized, consolidated operating and financial reporting platforms.

The effective tax rate increased by 5.4 percentage points, from 30.6 percent at September 30, 2012 to 36.0 percent of income before taxes at December 31, 2012, as a result of federal tax credits for the refurbishment of the Company’s new headquarters taken in the third quarter 2012.

ASSET QUALITY

Asset quality remains stable and strong. Nonperforming loans and leases increased slightly from $21.3 million at September 30, 2012 to $22.2 million at December 31, 2012. The ratio of nonperforming loans to total loans and leases increased from 0.51 percent at September 30, 2012 to 0.53 percent at December 31, 2012. Nonperforming assets at December 31, 2012 totaled $23.7 million or 0.46 percent of total assets, which is consistent with $23.7 million, or 0.47 percent of total assets, at September 30, 2012.

The provision for loan and lease losses was $3.1 million for the fourth quarter 2012, up slightly from $3.0 million in the third quarter 2012, and up from $0.8 million in the fourth quarter 2011. Net charge-offs for the fourth quarter 2012 were $0.8 million, or 0.08 percent of average loans and leases on an annualized basis, compared to $1.5 million, or 0.15 percent of average loans and leases, in the third quarter 2012, and $0.3 million, or 0.04 percent of average loans and leases, for the fourth quarter 2011.

The allowance for loan and lease losses was $41.2 million at December 31, 2012, compared to $38.9 million at September 30, 2012 and $31.7 million at December 31, 2011, an increase that reflects the loan growth experienced across the Company. The allowance for loan and lease losses as a percent of total loans and leases was 0.98 percent at December 31, 2012, compared to 0.94 percent at September 30, 2012 and 1.17 percent at December 31, 2011. The allowance for loan and lease losses as a percent of originated loans and leases was 1.33 percent at December 31, 2012, as compared to 1.31 percent at September 30, 2012.

DIVIDEND DECLARED

The Company’s Board of Directors approved a dividend of $0.085 per share. The dividend will be paid on February 27, 2013, to shareholders of record on February 13, 2013.

CONFERENCE CALL

The Company will conduct a conference call/webcast at 1:30PM eastern time on Thursday, January 31, 2013 to discuss the results for the quarter, business highlights and outlook. The call can be accessed by dialing 888-317-6016 (United States) or 412-317-6016 (internationally). 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 playback is 10023656. The call will be available live or in a recorded version on the Company’s website under “Investor Relations” at www.brooklinebank.com.

ABOUT BROOKLINE BANCORP, INC.

Brookline Bancorp, Inc., a bank holding company with approximately $5.15 billion in assets and 46 branches throughout Massachusetts and Rhode Island, is headquartered in Boston, Massachusetts and operates as the holding company for Brookline Bank, Bank Rhode Island, and First Ipswich Bank. The Company provides commercial and retail banking services, and 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, www.bankri.com, and www.fnbi.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. Forward-looking statements involve risks and uncertainties. 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. 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 GAAP as set forth by the FASB 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 net earnings from operations, the allowance for loan and lease losses as a percentage of originated loans and leases, tangible book value per common share and tangible stockholders’ equity to tangible assets. 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 sector. A detailed reconciliation table of the Company's GAAP to the non-GAAP measures is attached.

BROOKLINE BANCORP, INC. AND SUBSIDIARIES
Selected Financial Highlights (Unaudited)
                   

As of and for the Three Months
Ended December 31,

As of and for the Year
Ended December 31,

2012201120122011
(In Thousands Except Per Share Data)
Earnings Data:
Net interest income $ 44,564 $ 28,514 $ 177,368 $ 110,199
Provision for credit losses 3,101 842 15,888 3,631
Non-interest income 6,504 1,491 18,605 5,062
Non-interest expense 28,869 16,463 120,375 62,925
Income before income taxes 19,098 12,700 59,710 48,705
Net income attributable to Brookline Bancorp, Inc. 11,863 7,058 37,142 27,600
 
Performance Ratios:
Net interest margin (1) 3.79 % 3.78 % 3.85 % 3.76 %
Interest rate spread (1) 3.62 % 3.55 % 3.67 % 3.50 %
Return on average assets 0.93 % 0.89 % 0.73 % 0.90 %
Return on average stockholders' equity 7.76 % 5.59 % 5.29 % 5.51 %
 
Per Common Share Data:
Net income — Basic $ 0.17 $ 0.12 $ 0.53 $ 0.47
Net income — Diluted 0.17 0.12 0.53 0.47
Cash dividends declared 0.085 0.085 0.34 0.34
Book value per share (end of period) 8.70 8.50 8.70 8.50
Tangible book value per share (end of period) (non-GAAP) 6.43 7.64 6.43 7.64
Stock price (end of period) 8.50 8.44 8.50 8.44
 
(1) Calculated on a fully tax-equivalent basis.
 
 
At or for the Three Months Ended
Dec 31, 2012Sep 30, 2012Jun 30, 2012Mar 31, 2012Dec 31, 2011
(Dollars in Thousands)
Balance Sheet:
Total assets $ 5,147,534 $ 5,061,444 $ 4,972,381 $ 4,877,124 $ 3,299,013
Total loans and leases 4,178,945

 

4,146,315 4,013,129 3,935,518

 

2,720,821
Total deposits 3,616,259 3,568,016 3,521,206 3,459,333 2,252,331
Brookline Bancorp, Inc. stockholders’ equity 612,097 605,962 598,865 597,531 503,602
 
Asset Quality:
Nonperforming assets $ 23,703 $ 23,675 $ 23,831 $ 14,648 $ 8,796
Nonperforming assets as a percentage of total assets 0.46 % 0.47 % 0.48 % 0.30 % 0.27 %
Allowance for loan and lease losses $ 41,152 $ 38,913 $ 37,431 $ 34,428 $ 31,703

Allowance for loan and lease losses as a percentage
  of total loans and leases

0.98 % 0.94 % 0.93 % 0.87 % 1.17 %
Net loan and lease charge-offs $ 826 $ 1,539 $ 3,675 $ 522 $ 267

Net loan and lease charge-offs as a percentage
  of average loans and leases (annualized)

0.08 % 0.15 % 0.37 % 0.05 % 0.04 %
 
Capital Ratios:
Stockholders’ equity to total assets 11.89 % 11.97 % 12.04 % 12.25 % 15.27 %

Tangible stockholders’ equity to
  tangible assets (non-GAAP)

9.08 % 9.08 % 9.07 % 9.18 % 13.93 %
 
 

BROOKLINE BANCORP, INC. AND SUBSIDIARIES
Consolidated Balance Sheets (Unaudited)
                     

December 31,

September 30,

June 30,

March 31,December 31,
20122012201220122011
(In Thousands Except Share Data)
ASSETS
Cash and due from banks $ 78,441 $ 41,617 $ 118,411 $ 88,884 $ 56,513
Short-term investments   38,656     34,655     98,677     44,382     49,783  
Total cash and cash equivalents   117,097     76,272     217,088     133,266     106,296  
Investment securities available-for-sale 481,323 466,822 384,533 461,498 217,431
Restricted equity securities 68,661 68,661 61,291 53,554 39,283
Other securities   500     500     500     500     -  
Total securities   550,484     535,983     446,324     515,552     256,714  
Loans and leases:
Commercial real estate loans:
Commercial real estate mortgage 1,301,233 1,262,411 1,221,202 1,200,412 748,736
Multi-family mortgage 606,533 628,162 612,213 596,285 481,459
Construction   98,197     86,345     88,759     77,487     40,798  
Total commercial real estate   2,005,963     1,976,918     1,922,174     1,874,184     1,270,993  
Commercial loans and leases:
Commercial 382,277 346,744 319,867 309,338 150,895
Equipment financing 420,991 426,597 387,093 367,206 246,118
Condominium association   44,187     43,732     43,596     45,872     46,953  
Total commercial loans and leases   847,455     817,073     750,556     722,416     443,966  
Indirect automobile   542,344     574,279     581,063     578,622     573,350  
Consumer loans:
Residential mortgage 514,342 507,856 493,074 490,812 350,213
Home equity 261,562 263,194 260,623 262,591 76,527
Other consumer   7,279     6,995     5,639     6,893     5,772  
Total consumer loans   783,183     778,045     759,336     760,296     432,512  
Total loans and leases 4,178,945 4,146,315 4,013,129 3,935,518 2,720,821
Allowance for loan and lease losses   (41,152 )   (38,913 )   (37,431 )   (34,428 )   (31,703 )
Net loans and leases   4,137,793     4,107,402     3,975,698     3,901,090     2,689,118  
Premises and equipment, net 70,791

 

66,814

 

56,248 48,908 38,495
Building held-for-sale - 6,046 6,046 6,046 -
Deferred tax asset 27,197 27,354 25,656 24,647 12,681
Goodwill, net 137,890

 

137,890

 

137,890 138,914 45,799
Identified intangible assets, net of accumulated amortization 21,510 23,307 24,578 25,849 5,214
Other real estate owned and repossessed assets, net 1,491 2,386 2,765 2,647 1,266
Monies in escrow – Bancorp Rhode Island, Inc. acquisition - - - - 112,983
Other assets   83,281     77,990     80,088     80,205     30,447  
Total assets $ 5,147,534   $ 5,061,444   $ 4,972,381   $ 4,877,124   $ 3,299,013  
 
LIABILITIES AND EQUITY
Deposits:
Demand checking accounts $ 623,274 $ 590,189 $ 546,036 $ 529,945 $ 225,284
NOW accounts 212,858 183,478 185,234 181,299 110,220
Savings accounts 515,367 520,614 503,507 511,736 164,744
Money market accounts 1,253,819 1,231,206 1,236,967 1,174,805 946,411
Certificate of deposit accounts   1,010,941     1,042,529     1,049,462     1,061,548     805,672  

Total deposits

  3,616,259     3,568,016     3,521,206     3,459,333     2,252,331  
Borrowed funds:
Advances from the FHLBB 790,865 771,110 733,394 698,671 498,570
Other borrowed funds   63,104     57,146     60,707     59,865     8,349  
Total borrowed funds   853,969     828,256     794,101     758,536     506,919  
Mortgagors’ escrow accounts 6,946 7,066 6,942 7,156 6,513
Accrued expenses and other liabilities   54,551     47,889     47,328     50,883     26,248  
Total liabilities   4,531,725     4,451,227     4,369,577     4,275,908     2,792,011  
 
Equity:
Brookline Bancorp, Inc. stockholders’ equity:

Preferred stock, $0.01 par value; 50,000,000 shares
  authorized; none issued

- - - - -

Common stock, $0.01 par value; 200,000,000 shares authorized;
  75,749,825 shares, 75,749,819 shares, 75,414,713 shares,
  75,585,504 shares and 64,597,180 shares issued, respectively

754 754 754 754 644
Additional paid-in capital 618,429 618,176 618,184 618,031 525,171
Retained earnings, partially restricted 53,358 47,451 42,006 40,398 39,993
Accumulated other comprehensive income 3,483 3,569 1,969 2,457 1,963
Treasury stock, at cost; 5,373,733 shares (62,107 ) (62,107 ) (62,107 ) (62,107 ) (62,107 )

Unallocated common stock held by ESOP; 333,918 shares,
  344,991 shares, 356,064 shares, 367,137 shares,
  and 378,215 shares, respectively

(1,820 ) (1,881 ) (1,941 ) (2,002 ) (2,062 )
Total Brookline Bancorp, Inc. stockholders’ equity   612,097     605,962     598,865     597,531     503,602  
Noncontrolling interest in subsidiary   3,712     4,255     3,939     3,685     3,400  
Total equity   615,809     610,217     602,804     601,216     507,002  
Total liabilities and equity $ 5,147,534   $ 5,061,444   $ 4,972,381   $ 4,877,124   $ 3,299,013  
 
 

BROOKLINE BANCORP, INC. AND SUBSIDIARIES
Consolidated Statements of Income (Unaudited)
                 
Three Months Ended Dec. 31,Year Ended Dec. 31,
2012201120122011
(In Thousands Except Share Data)
Interest and dividend income:
Loans and leases $ 50,662 $ 34,500 $ 203,711 $ 133,938
Debt securities 1,832 1,299 8,551 6,297
Short-term investments 42 28 208 105
Marketable and restricted equity securities   440     55     730     195  
Total interest and dividend income   52,976     35,882     213,200     140,535  
 
Interest expense:
Deposits 5,077 4,754 21,432 19,757
Borrowed funds and subordinated debt   3,335     2,614     14,400     10,579  
Total interest expense   8,412     7,368     35,832     30,336  
 
Net interest income 44,564 28,514 177,368 110,199
Provision for credit losses   3,101     842     15,888     3,631  
Net interest income after provision for credit losses   41,463     27,672     161,480     106,568  
 
Non-interest income:
Fees, charges and other income 4,716 1,662 16,475 5,653
Loss from investments in affordable housing projects (239 ) (171 ) (694 ) (671 )
Gain on sales of securities, net 129 - 926 80
Gain on sales of loans and leases   1,898     -     1,898     -  
Total non-interest income   6,504     1,491     18,605     5,062  
 
Non-interest expense:
Compensation and employee benefits 15,705 8,092 58,830 30,789
Occupancy 2,759 1,628 10,611 6,138
Equipment and data processing 3,191 2,417 14,540 9,144
Professional services 1,536 1,722 12,475 5,375
FDIC insurance 1,089 510 4,212 1,746
Advertising and marketing 818 360 2,984 1,376
Amortization of identified intangible assets 1,797 377 5,622 1,570
Other   1,974     1,357     11,101     6,787  
Total non-interest expense   28,869     16,463     120,375     62,925  
 
Income before income taxes 19,098 12,700 59,710 48,705
Provision for income taxes   6,868     5,339     21,341     19,886  
Net income 12,230 7,361 38,369 28,819

Less net income attributable to noncontrolling
  interest in subsidiary

367 303 1,227 1,219
Net income attributable to Brookline Bancorp, Inc. $ 11,863   $ 7,058   $ 37,142   $ 27,600  
 
Earnings per common share:
Basic $ 0.17 $ 0.12 $ 0.53 $ 0.47
Diluted 0.17 0.12 $ 0.53 $ 0.47
 
Weighted average common shares outstanding during the period:
Basic 69,742,225 58,652,370 69,702,417 58,633,627
Diluted 69,799,324 58,652,760 69,746,256 58,636,431
 
Dividends declared per common share $ 0.085 $ 0.085 $ 0.34 $ 0.34
 
 

Note: Certain amounts previously reported have been reclassified to conform to the current period's presentation.

 
 

BROOKLINE BANCORP, INC. AND SUBSIDIARIES
Asset Quality Analysis (Unaudited)
                     
At or for the Three Months Ended
Dec 31, 2012Sep 30, 2012Jun 30, 2012Mar 31, 2012Dec 31, 2011
(Dollars in Thousands)
NONPERFORMING ASSETS:
 
Loans and leases accounted for on a nonaccrual basis:
Commercial real estate mortgage $ 2,546 $ 2,078 $ 2,120 $ - $ -
Multi-family mortgage 1,931 2,758 3,129 2,634 1,380
Construction   -     -     -     -     -  
Total commercial real estate loans 4,477 4,836 5,249 2,634 1,380
 
Commercial 3,330 5,432 6,896 2,146 -
Equipment financing 3,840 3,040 2,375 1,226 1,925
Condominium association   8     9     11     13     15  
Total commercial loans and leases 7,178 8,481 9,282 3,385 1,940
 
Indirect automobile loans 96 80 91 27 111
 
Residential mortgage 2,994 2,298 3,088 2,999 1,327
Home equity 716 988 784 299 98
Other consumer   45     49     5     10     10  
Total consumer loans 3,755 3,335 3,877 3,308 1,435
 
Acquired from First Ipswich Bank   6,705     4,557     2,567     2,647     2,664  
Total nonaccrual loans and leases 22,211 21,289 21,066 12,001 7,530
 
Other real estate owned 904 1,690 2,082 2,207 845
Other repossessed assets   588     696     683     440     421  
 
Total nonperforming assets $ 23,703   $ 23,675   $ 23,831   $ 14,648   $ 8,796  
 
Troubled debt restructurings on accrual $ 7,191   $ 6,588   $ 6,443   $ 6,692   $ 5,205  
 
Nonperforming loans and leases as a percentage of total loans and leases 0.53 % 0.51 % 0.52 % 0.30 % 0.28 %
Nonperforming assets as a percentage of total assets 0.46 % 0.47 % 0.48 % 0.30 % 0.27 %
 
 
PROVISION AND ALLOWANCE FOR LOAN AND LEASE LOSSES:
 
Allowance for loan and lease losses at beginning of period $ 38,913 $ 37,431 $ 34,428 $ 31,703 $ 31,128
Charge-offs (1,527 ) (1,807 ) (3,970 ) (788 ) (533 )
Recoveries   701     268     295     266     266  
Net charge-offs (826 ) (1,539 ) (3,675 ) (522 ) (267 )
Provision for loan and lease losses   3,065     3,021     6,678     3,247     842  
Allowance for loan and lease losses at end of period $ 41,152   $ 38,913   $ 37,431   $ 34,428   $ 31,703  
 

Allowance for loan and lease losses as a percentage of
  total loans and leases

0.98 % 0.94 % 0.93 % 0.87 % 1.17 %

Allowance for loan and lease losses as a percentage of
  originated loans and leases

1.33 % 1.31 % 1.33 % 1.29 % 1.25 %
 
NET CHARGE-OFFS:
 
Commercial real estate loans $ - $ (38 ) $ (40 ) $ (40 ) $ -
Commercial loans and leases 196 1,179 3,292 263 (18 )
Indirect automobile loans 366 301 225 292 278
Consumer loans   264     97     198     7     7  
Total net charge-offs $ 826   $ 1,539   $ 3,675   $ 522   $ 267  
 

Net loan and lease charge-offs as a percentage of
  average loans and leases (annualized)

0.08 % 0.15 % 0.37 % 0.05 % 0.04 %
 
 

BROOKLINE BANCORP, INC. AND SUBSIDIARIES
Average Yields / Costs (Unaudited)
                                     
Three Months Ended
December 31, 2012September 30, 2012December 31, 2011

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:
Short-term investments $ 70,040 $ 42 0.24 % $ 103,614 $ 71 0.27 % $ 76,376 $ 28 0.15 %
Investment securities available-for-sale (2) 456,690 1,854 1.62 % 418,513 1,967 1.88 % 231,662 1,307 2.26 %
Restricted equity securities (2) 68,660 508 2.95 % 56,047 98 0.70 % 40,136 64 0.63 %
Commercial real estate loans (3) 1,967,921 23,798 4.86 % 1,944,222 23,648 4.89 % 1,240,063 16,296 5.26 %
Commercial loans (3) 395,991 5,042 5.08 % 378,270 5,660 5.97 % 198,000 2,389 4.81 %
Equipment financing (3) 428,867 8,285 7.73 % 406,976 9,025 8.87 % 238,290 4,652 7.81 %
Indirect automobile loans (3) 560,118 5,510 3.91 % 577,119 5,852 4.03 % 573,102 6,722 4.65 %
Residential mortgage loans (3) 507,955 5,323 4.19 % 506,701 5,686 4.49 % 346,244 3,696 4.27 %
Other consumer loans (3)   269,019     2,713 4.01 %   269,915     3,544 5.22 %   79,924     800 3.98 %
Total interest-earning assets 4,725,261   53,075 4.50 % 4,661,377   55,551 4.77 % 3,023,797   35,954 4.75 %
Allowance for loan and lease losses (39,435 ) (40,510 ) (31,230 )
Non-interest-earning assets   398,980     423,762     192,987  
Total assets $ 5,084,806   $ 5,044,629   $ 3,185,554  
 
Liabilities and Stockholders' Equity:
Interest-bearing liabilities:
Deposits:
NOW accounts $ 184,849 $ 48 0.10 % $ 181,891 $ 51 0.11 % $ 111,798 $ 50 0.18 %
Savings accounts 518,452 374 0.29 % 517,068 410 0.32 % 165,619 208 0.50 %
Money market accounts 1,246,514 2,115 0.68 % 1,239,230 2,246 0.72 % 917,712 1,960 0.85 %
Certificates of deposit   1,028,884     2,540 0.98 %   1,049,390     2,668 1.01 %   806,158     2,536 1.25 %
Total interest-bearing deposits (4) 2,978,699 5,077 0.68 % 2,987,579 5,375 0.72 % 2,001,287 4,754 0.94 %
Advances from the FHLBB 757,842 3,207 1.68 % 757,017 3,408 1.79 % 420,874 2,602 2.45 %
Other borrowed funds   62,299     128 0.82 %   57,753     200 1.38 %   6,206     12 0.75 %
Total interest-bearing liabilities 3,798,840   8,412 0.88 % 3,802,349   8,983 0.94 % 2,428,367   7,368 1.20 %

Non-interest-bearing demand
  checking accounts (4)

612,267 572,305 223,359
Other liabilities   58,496     58,300     25,987  
Total liabilities 4,469,603 4,432,954 2,677,713
Brookline Bancorp, Inc. stockholders’ equity 611,181 605,988 504,576
Noncontrolling interest in subsidiary   4,022     5,687     3,265  
Total liabilities and equity $ 5,084,806   $ 5,044,629   $ 3,185,554  

Net interest income (tax-equivalent basis) /
  Interest rate spread (5)

44,663 3.62 % 46,568 3.83 % 28,586 3.55 %
Less adjustment of tax-exempt income   99   157   73
Net interest income $ 44,564 $ 46,411 $ 28,513
Net interest margin (6) 3.79 % 4.00 % 3.78 %
 

(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 securities available-for-sale. Equity securities include marketable equity securities and restricted equity 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)

Including non-interest-bearing checking accounts, the average interest rate on total deposits was 0.56%, 0.60% and 0.85% in the three months ended December 31, 2012, September 30, 2012, and December 31, 2011, respectively.

 

(5)

Interest rate spread represents the difference between the yield on interest-earning assets and the cost of interest-bearing liabilities.

 

(6)

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, 2012December 31, 2011

Average
Balance

Interest (1)

Average
Yield/Cost

Average
Balance

Interest (1)

Average
Yield/Cost

(Dollars in Thousands)
Assets:
Interest-earning assets:
Short-term investments $ 95,173 $ 209 0.22 % $ 73,628 $ 105 0.14 %
Investment securities available-for-sale (2) 449,694 8,606 1.91 % 278,300 6,327 2.27 %
Restricted equity securities (2) 58,354 824 1.41 % 39,557 224 0.57 %
Commercial real estate loans (3) 1,910,320 94,521 4.97 % 1,162,770 61,217 5.28 %
Commercial loans (3) 370,366 19,471 5.26 % 180,713 8,698 4.81 %
Equipment financing (3) 394,845 32,027 8.11 % 221,458 18,019 8.14 %
Indirect automobile loans (3) 573,398 23,641 4.12 % 575,635 28,313 4.92 %
Residential mortgage loans (3) 501,660 21,998 4.39 % 335,940 14,901 4.44 %
Other consumer loans (3)   269,725     12,299 4.56 %   76,156     3,022 3.97 %
Total interest-earning assets 4,623,535   213,596 4.63 % 2,944,157   140,826 4.79 %
Allowance for loan and lease losses (38,073 ) (30,564 )
Non-interest earning assets   502,330     148,179  
Total assets $ 5,087,792   $ 3,061,772  
 
Liabilities and Stockholders' Equity:
Interest-bearing liabilities:
Deposits:
NOW accounts $ 183,046 $ 209 0.11 % $ 126,950 $ 216 0.17 %
Savings accounts 517,485 1,726 0.33 % 157,578 942 0.60 %
Money market accounts 1,203,113 8,773 0.73 % 830,780 7,626 0.92 %
Certificates of deposit   1,055,510     10,724 1.02 %   813,470     10,973 1.35 %
Total interest-bearing deposits (4) 2,959,154 21,432 0.72 % 1,928,778 19,757 1.02 %
Advances from the FHLBB 732,457 13,710 1.87 % 414,432 10,456 2.52 %
Other borrowed funds   60,497     690 1.14 %   7,696     123 1.60 %
Total interest-bearing liabilities 3,752,108   35,832 0.95 % 2,350,906   30,336 1.29 %

Non-interest-bearing demand
  checking accounts (4)

562,238 181,078
Other liabilities   68,055     26,099  
Total liabilities 4,382,401 2,558,083
Brookline Bancorp, Inc. stockholders’ equity 701,661 500,922
Noncontrolling interest in subsidiary   3,730     2,767  
Total liabilities and equity $ 5,087,792   $ 3,061,772  

Net interest income (tax equivalent basis) /
  Interest rate spread (5)

177,764 3.67 % 110,490 3.50 %
Less adjustment of tax-exempt income   396   291
Net interest income $ 177,368 $ 110,199
Net interest margin (6) 3.85 % 3.76 %
 

(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 securities available for sale. Equity securities include marketable equity securities and restricted equity 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)

Including non-interest-bearing checking accounts, the average interest rate on total deposits was 0.61% and 0.94% in the twelve months ended December 31, 2012 and 2011, respectively.

 

(5)

Interest rate spread represents the difference between the yield on interest-earning assets and the cost of interest-bearing liabilities.

 

(6)

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)
                 
Three Months Ended December 31,   Year Ended December 31,
2012201120122011
Reconciliation Table - Non-GAAP Financial Information (Dollars in Thousands Except Share Data)
 
Net income attributable to Brookline Bancorp, Inc. $ 11,863 $ 7,058 $ 37,142 $ 27,600
Add:
Acquisition-related expenses (after-tax)   -     499     3,972     1,302  
Net earnings from operations$11,863   $7,557   $41,114   $28,902  
 
Operating earnings per common share:
Basic $ 0.17 $ 0.13 $ 0.59 $ 0.49
Diluted 0.17 0.13 0.59 0.49
 
Weighted average common shares outstanding during the period:
Basic 69,742,225 58,652,370 69,702,417 58,633,627
Diluted 69,799,324 58,652,760 69,746,256 58,636,431
 
 
 
 
Dec 31, 2012Sep 30, 2012Jun 30, 2012Mar 31, 2012Dec 31, 2011
(Dollars in Thousands)
 
Brookline Bancorp, Inc. stockholders’ equity $ 612,097 $ 605,962 $ 598,865 597,531 $ 503,602
Less:

Goodwill

137,890 137,890 137,890 138,914 45,799
Identified intangible assets   21,510     23,307     24,578     25,849     5,214  
Tangible stockholders' equity $ 452,697   $ 444,765   $ 436,397   $ 432,768   $ 452,589  
 
Total assets 5,147,534 5,061,444 4,972,381 4,877,124 3,299,013
Less:
Goodwill 137,890 137,890 137,890 138,914 45,799
Identified intangible assets   21,510     23,307     24,578     25,849     5,214  
Tangible assets $ 4,988,134   $ 4,900,247   $ 4,809,913   $ 4,712,361   $ 3,248,000  

 

 

Tangible stockholders’ equity to tangible assets9.08%9.08%9.07%9.18%13.93%
 
 
 
Dec 31, 2012Sep 30, 2012Jun 30, 2012Mar 31, 2012Dec 31, 2011
(Dollars in Thousands Except Per Share Data)
 
Tangible stockholders' equity $ 452,697   $ 444,765   $ 436,397   $ 432,768   $ 452,589  
 
Common shares issued 75,749,825 75,749,819 75,414,713 75,585,504 64,597,180
Less:
Treasury shares   5,373,733     5,373,733     5,373,733     5,373,733     5,373,733  
Number of common shares outstanding   70,376,092     70,376,086     70,040,980     70,211,771     59,223,447  
 
Tangible book value per common share$6.43$6.32$6.23$6.16$7.64
 

Contacts:

Brookline Bancorp, Inc.
Julie A. Gerschick, 617-425-5331
Chief Financial Officer and Treasurer
jgerschick@brkl.com

Source: Brookline Bancorp, Inc.

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