First Quarter Highlights:
- Revenue Growth: Total Revenue
increased 4% linked quarter and 13% year-over-year to $87.4
million.
- Deposit and Loan Growth: Average
Total Deposits increased 7% year-over-year to $5.4 billion. On a
linked quarter basis, Average Total Deposits decreased 1% due to
seasonal outflows, while Average Total Loans grew 3% year-over-year
and 1% linked quarter. The Average Loan-to-Deposit ratio was 97% at
the end of the first quarter, down from 101% in the first quarter
of 2014.
- Provision Credit: The Company
recorded a provision credit of $2.5 million due to net recoveries
of $3.9 million in the quarter, offset by provision for criticized
and classified loans.
Boston Private Financial Holdings, Inc. (NASDAQ: BPFH) (the
“Company” or “BPFH”) today reported first quarter 2015 GAAP Net
Income Attributable to the Company of $18.8 million, compared to
$12.2 million for the fourth quarter of 2014. First quarter 2015
diluted earnings per share were $0.21, a $0.08 increase from the
fourth quarter of 2014, and a $0.01 increase from the first quarter
of 2014.
“We continue to focus our efforts on expanding our private
clients business,” said Clayton G. Deutsch, CEO and President. "In
February, we officially introduced Boston Private Wealth to the
marketplace, our newly formed wealth management subsidiary within
Boston Private Bank & Trust Company. In addition, our West
Coast Private Banking group has maintained the positive momentum it
experienced in 2014 in the first quarter.”
Core Fees and Income Increased 27% Year-Over-Year
Core Fees and Income increased 27% year-over-year to $40.2
million. The increase reflects organic growth as well as increases
from Banyan Partners LLC, which was acquired in October 2014. On a
linked quarter basis, Core Fees and Income increased 1% from $39.6
million in the fourth quarter of 2014.
Total Assets Under Management/Advisory (“AUM”) were flat on a
linked basis quarter and up 21% year-over-year to $30.0 billion.
The year-over-year increase includes organic growth and AUM related
to the Banyan acquisition.
Net Interest Income
Net Interest Income for the first quarter was $46.1 million, up
4% from $44.1 million for the fourth quarter of 2014. On a
year-over-year basis, Net Interest Income increased 3% from $44.5
million. Included in the first quarter 2015 Net Interest Income is
$1.7 million of interest recovered on previous non-accrual loans.
Excluding the $1.7 million of interest recovered, Net Interest
Income was $44.4 million.
Net Interest Margin was 3.00% for the first quarter, up 17 basis
points from 2.83% for the fourth quarter of 2014. Net Interest
Margin was down 4 basis points from 3.04% for the first quarter of
2014. Excluding interest recovered on previous nonaccrual loans,
Net Interest Margin was 2.89% for the first quarter of 2015.
Total Operating Expenses
Total Operating Expenses for the first quarter of 2015 were
$63.4 million, down 1% from $63.8 million for the fourth quarter of
2014. On a year-over-year basis, Total Operating Expenses increased
15% from $55.0 million, primarily due to the impact of the Banyan
acquisition.
Provision and Asset Quality
The Company recorded a provision credit of $2.5 million for the
first quarter of 2015, compared to a provision expense of $2.4
million for the fourth quarter of 2014. The provision credit was
driven by net recoveries of $3.9 million, partially offset by loan
downgrades. The Company recorded a provision credit of $1.2 million
for the first quarter of 2014.
Criticized Loans increased 3% on a linked quarter basis and
decreased 12% year-over-year. Nonaccrual Loans (“Nonaccruals”)
decreased 27% to $32.1 million on a linked quarter basis. On a
year-over-year basis, Nonaccruals decreased 24% from $42.1 million.
As a percentage of Total Loans, Nonaccruals were 61 basis points at
March 31, 2015, down 23 basis points from December 31, 2014, and
down 20 basis points from March 31, 2014.
Additional credit metrics are listed below on a linked quarter
and year-over-year basis:
(In millions)
March 31, 2015 December 31, 2014
March 31, 2014 Total Criticized Loans $ 164.1 $ 159.6
$ 187.3
Total Loans 30-89 Days Past Due and
Accruing (11)
$ 25.4 $ 7.0 $ 10.6 Total Net Loans (Charged-off)/ Recovered $ 3.9
$ (1.8 ) $ 1.4 Allowance for Loan Losses/ Total Loans 1.46 % 1.44 %
1.48 %
Capital Ratios
Capital ratios are listed below on a linked quarter and
year-over-year basis:
March 31,
2015 December 31, 2014 March 31,
2014 BPFH Ratios: Total Risk-Based Capital * 14.0 %
14.5 % 15.0 % Tier I Risk-Based Capital * 12.3 % 13.3 % 13.7 % Tier
I Leverage Capital * 9.5 % 9.5 % 10.2 % TCE/TA 7.2 % 7.0 % 7.1 %
Tier I Common Equity/ Risk Weighted Assets * 9.8 % 9.8 % 10.1 %
*March 31, 2015 information is presented based on estimated data
and incorporates the implementation of Basel III.
Dividend PaymentsConcurrent with
the release of first quarter 2015 earnings, the Board of Directors
of the Company declared a cash dividend to common stock
shareholders of $0.09 per share. The record date for this dividend
is May 8, 2015, and the payment date is May 22, 2015.
The Board of Directors of the Company also declared a cash
dividend to holders of the Non-Cumulative Perpetual Preferred
Stock, Series D of $17.375 per share, which will result in a
dividend of $0.434375 per depositary share. The record date for
this dividend is May 15, 2015, and the payment date is June 15,
2015.
Non-GAAP Financial MeasuresThe
Company uses certain non-GAAP financial measures, such as tangible
book value per share; the TCE/TA ratio; return on average common
equity; return on average tangible common equity; pre-tax,
pre-provision earnings; and the efficiency ratio (FTE basis), to
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.
Conference CallManagement will hold
a conference call at 8 a.m. Eastern Time on Wednesday, April 15,
2015, to discuss the financial results, business highlights and
outlook. To access the call:
Dial In #: (888) 317-6003Elite Entry Number: 2955905
Replay Information:Available from April 15, 2015 at 12 noon
until April 22, 2015Dial In #: (877) 344-7529Conference Number:
10063688
The call will be simultaneously webcast and may be accessed on
www.bostonprivate.com.
Boston Private Financial Holdings,
Inc.Boston Private Financial Holdings, Inc. is a national
financial services organization that owns Wealth Management and
Private Banking affiliates with offices in Boston, New York, Los
Angeles, San Francisco, San Jose, Atlanta, Florida, Wisconsin, and
Texas. The Company has a $7 billion Private Banking balance sheet,
and manages approximately $30 billion of client assets.
The Company positions its affiliates to serve the high net worth
marketplace with high quality products and services of unique
appeal to private clients. The Company also provides strategic
oversight and access to resources, both financial and intellectual,
to support affiliate management, marketing, compliance and legal
activities. (NASDAQ: BPFH)
For more information about BPFH, visit the Company's website
at www.bostonprivate.com.
Forward-Looking StatementsCertain
statements 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. These
statements include, among others, statements regarding our
strategy, evaluations of future interest rate trends and liquidity,
prospects for growth in assets, and prospects for overall results
over the long term. You should not place undue reliance on our
forward-looking statements. You should exercise caution in
interpreting and relying on forward-looking statements because they
are subject to significant risks, uncertainties and other factors
which are, in some cases, beyond the Company's control.
Forward-looking statements are based on the current assumptions and
beliefs of management and are only expectations of future results.
The Company's actual results could differ materially from those
projected in the forward-looking statements as a result of, among
other factors, adverse conditions in the capital and debt markets
and the impact of such conditions on the Company's private banking,
investment management and wealth advisory activities; changes in
interest rates; competitive pressures from other financial
institutions; the effects of weakness in general economic
conditions on a national basis or in the local markets in which the
Company operates; changes in loan defaults and charge-off rates;
changes in the value of securities and other assets, adequacy of
loan loss reserves, or decreases in deposit levels necessitating
increased borrowing to fund loans and investments; increasing
government regulation; the risk that goodwill and intangibles
recorded in the Company's financial statements will become
impaired; the risk that the Company's deferred tax asset may not be
realized; risks related to the identification and implementation of
acquisitions, dispositions and restructurings; changes in
assumptions used in making such forward-looking statements; and the
other risks and uncertainties detailed in the Company's Annual
Report on Form 10-K and updated by the Company's Quarterly Reports
on Form 10-Q and other filings submitted to the Securities and
Exchange Commission. Forward-looking statements speak only as of
the date on which they are made. 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 statement is made.
Note to Editors:Boston Private
Financial Holdings, Inc. is not to be confused with Boston Private
Bank & Trust Company. Boston Private Bank & Trust Company
is a wholly-owned subsidiary of BPFH. The information reported in
this press release is related to the performance and results of
BPFH.
Boston Private Financial Holdings, Inc. Selected
Financial Data (Unaudited) (In
thousands, except share and per share data)
3/31/2015
12/31/2014 3/31/2014
Assets: Cash and cash equivalents
$
88,118 $ 172,609 $ 398,687 Investment securities available
for sale
971,842 829,993 700,531 Investment securities held
to maturity
134,978 140,727 127,938 Stock in Federal Home
Loan Banks
32,761 32,281 37,450 Loans held for sale
10,570 7,099 2,297 Total loans
5,295,013 5,269,936
5,162,470 Less: Allowance for loan losses
77,263
75,838 76,605 Net loans
5,217,750 5,194,098 5,085,865 Other real estate owned
(“OREO”)
929 929 921 Premises and equipment, net
30,999 32,199 29,045 Goodwill
152,082 152,082 110,180
Intangible assets, net
38,116 39,718 19,551 Fees receivable
12,519 12,517 11,039 Accrued interest receivable
15,990 16,071 15,057 Deferred income taxes, net
45,614 47,576 53,716 Other assets
117,504
119,975 113,143 Total assets
$ 6,869,772 $ 6,797,874 $ 6,705,420
Liabilities: Deposits
$ 5,373,407 $
5,453,879 $ 5,341,644 Securities sold under agreements to
repurchase
52,237 30,496 93,550 Federal funds purchased
50,000 — 15,000 Federal Home Loan Bank borrowings
450,022 370,150 394,458 Junior subordinated debentures
106,363 106,363 106,363 Other liabilities
97,773 112,170 87,652
Total liabilities
6,129,802 6,073,058
6,038,667
Redeemable Noncontrolling
Interests 21,280 20,905 20,774
Shareholders’
Equity: Preferred stock, $1.00 par value; authorized: 2,000,000
shares
47,753 47,753 47,753
Common stock, $1.00 par value; authorized:
170,000,000 shares; issued and outstanding: 83,051,675 shares at
March 31, 2015; 82,961,855 shares at December 31, 2014; 80,001,139
shares at March 31, 2014
83,052 82,962 80,001 Additional paid-in capital
604,386 610,903 610,590 Accumulated deficit
(18,613
) (37,396 ) (89,170 ) Accumulated other comprehensive
income/ (loss)
1,120 (697 )
(3,305 ) Total Company’s shareholders’ equity
717,698
703,525 645,869 Noncontrolling
interests
992 386 110
Total shareholders’ equity
718,690
703,911 645,979 Total liabilities,
redeemable noncontrolling interests and shareholders’ equity
$ 6,869,772 $ 6,797,874 $ 6,705,420
Boston Private Financial Holdings, Inc.
Selected Financial Data (Unaudited) Three Months
Ended (In thousands, except share and per share data)
3/31/2015 12/31/2014
3/31/2014 Interest and dividend income: Loans
$ 48,000 $ 47,117 $ 47,214 Taxable investment
securities
995 920 636 Non-taxable investment securities
1,021 978 904 Mortgage-backed securities
2,614 1,695
1,936 Federal funds sold and other
234
381 346 Total interest and dividend income
52,864 51,091 51,036
Interest expense: Deposits
3,892 3,908 3,216
Federal Home Loan Bank borrowings
1,931 2,069 2,326 Junior
subordinated debentures
956 976 955 Repurchase agreements
and other short-term borrowings
13 10
17 Total interest expense
6,792
6,963 6,514 Net interest income
46,072 44,128 44,522 Provision/ (credit) for loan losses
(2,500 ) 2,400 (1,200 )
Net interest income after provision/ (credit) for loan losses
48,572 41,728 45,722
Fees and other income: Investment management fees
11,714 11,897 11,461 Wealth advisory fees
12,675
12,352 11,473 Wealth management and trust fees
13,558 13,327
6,961 Other banking fee income
1,910 1,841 1,680 Gain on
sale of loans, net
303 192
89 Total core fees and income
40,160
39,609 31,664 Gain/ (loss) on
sale of investments, net
8 (16 ) 1 Gain/ (loss) on OREO, net
89 (31 ) 819 Other
1,088 360
249 Total other income
1,185
313 1,069
Operating
expense: Salaries and employee benefits
42,127 39,881
36,574 Occupancy and equipment
9,035 8,549 7,797
Professional services
3,021 3,308 2,843 Marketing and
business development
1,348 2,425 1,426 Contract services and
data processing
1,437 1,527 1,438 Amortization of
intangibles
1,603 1,707 1,053 FDIC insurance
1,011
852 896 Restructuring
— 739 — Other
3,845
4,772 2,941 Total operating
expense
63,427 63,760
54,968 Income before income taxes
26,490 17,890
23,487 Income tax expense
8,572 5,901
7,138 Net income from continuing operations
17,918 11,989 16,349 Net income from discontinued operations
(1)
2,094 1,510 1,928
Net income before attribution to noncontrolling interests
20,012 13,499 18,277 Less: Net income attributable to
noncontrolling interests
1,229 1,322
1,236
Net income attributable to the
Company $ 18,783 $ 12,177 $ 17,041
Boston Private Financial Holdings, Inc.
Selected
Financial Data (Unaudited) (In thousands, except share
and per share data)
Three Months Ended
PER SHARE DATA: 3/31/2015
12/31/2014 3/31/2014
Calculation of Income for EPS: Net income attributable to
the Company
$ 18,783 $ 12,177 $ 17,041
Adjustments to Net Income Attributable to
the Company to Arrive at NetIncome Attributable to Common
Shareholders (2)
(1,005 ) (1,176 ) (1,061 )
Net Income Attributable to the Common Shareholders
17,778 11,001 15,980 LESS: Amount allocated to participating
securities
(60 ) (27 ) (117 )
Net Income Attributable to the Common
Shareholders, after allocation toparticipating
securities
$ 17,718 $ 10,974 $ 15,863
End of Period Common Shares Outstanding
83,051,675 82,961,855 80,001,139
Weighted Average
Shares Outstanding: Weighted average basic shares, including
participating securities
80,983,916 80,880,508 79,107,968
LESS: Participating securities
(469,557 ) (487,596 )
(962,783 ) PLUS: Dilutive potential common shares
2,079,966 2,096,172 1,865,705
Weighted Average Diluted Shares (3)
82,594,325 82,489,084 80,010,890
Diluted Total Earnings per Share $
0.21 $ 0.13 $ 0.20
Boston Private Financial
Holdings, Inc. Selected Financial Data
(Unaudited) (In thousands, except per share data)
FINANCIAL DATA: 3/31/2015
12/31/2014 3/31/2014 Book Value
Per Common Share
$ 8.08 $ 7.91 $ 7.48 Tangible Book
Value Per Share (4)
$ 5.79 $ 5.60 $ 5.86 Market Price
Per Share
$ 12.15 $ 13.47 $ 13.53
ASSETS
UNDER MANAGEMENT AND ADVISORY: Wealth Management and Trust
$ 9,306,000 $ 9,274,000 $ 4,612,000 Investment
Managers
10,730,000 10,772,000 10,505,000 Wealth Advisory
10,012,000 9,883,000 9,641,000 Less: Inter-company
Relationship
(22,000 ) (22,000 )
(22,000 ) Total Assets Under Management and Advisory
$
30,026,000 $ 29,907,000 $ 24,736,000
BPFH FINANCIAL RATIOS: Total Equity/ Total Assets
10.46 % 10.35 % 9.63 % Tangible Common Equity/
Tangible Assets (4)
7.20 % 7.03 % 7.12 % Tier I
Common Equity/ Risk Weighted Assets (4)
9.76 % 9.76 %
10.11 % Allowance for Loan Losses/ Total Loans
1.46 %
1.44 % 1.48 % Allowance for Loan Losses/ Nonaccrual Loans
240 % 172 % 182 % Return on Average Assets - Three
Months Ended (Annualized)
1.10 % 0.71 % 1.06 % Return
on Average Common Equity - Three Months Ended (Annualized) (5)
10.79 % 6.97 % 10.91 % Return on Average Tangible
Common Equity - Three Months Ended (Annualized) (5)
16.03
% 10.69 % 14.58 % Efficiency Ratio - Three Months Ended (6)
68.74 % 70.83 % 67.88 %
Boston
Private Financial Holdings, Inc.
Selected Financial Data
(Unaudited) Average Balance Interest
Income/Expense Average Yield/Rate (In thousands)
Three Months Ended Three Months Ended Three Months
Ended AVERAGE BALANCE SHEET: 3/31/15
12/31/14 3/31/14 3/31/15
12/31/14 3/31/14 3/31/15
12/31/14 3/31/14 AVERAGE ASSETS
Interest-Earning Assets: Cash and Investments: Taxable investment
securities
$ 320,373 $ 305,118 $ 254,407
$
995 $ 920 $ 636
1.24 % 1.21 % 1.00 %
Non-taxable investment securities (7)
230,251 229,157
224,054
1,571 1,504 1,391
2.73 % 2.63 % 2.48 %
Mortgage-backed securities
516,032 350,312 341,082
2,614 1,695 1,936
2.03 % 1.93 % 2.27 % Federal
funds sold and other
147,999 389,833
204,157
234 381 346
0.64
% 0.39 % 0.68 % Total Cash and Investments
1,214,655 1,274,420 1,023,700
5,414 4,500 4,309
1.78 % 1.41 %
1.68 % Loans (8): Commercial and Construction (7)
2,851,801
2,852,064 2,833,475
31,366 30,855 30,921
4.40
% 4.23 % 4.37 % Residential
2,140,525 2,120,416
2,035,232
16,656 16,447 16,169
3.11 % 3.10 %
3.18 % Home Equity and Other Consumer
277,967
254,387 245,596
1,953 1,799
1,805
2.85 % 2.80 % 2.98 % Total Loans
5,270,293 5,226,867 5,114,303
49,975 49,101 48,895
3.80 % 3.71
% 3.83 % Total Earning Assets
6,484,948
6,501,287 6,138,003
55,389 53,601
53,204
3.42 % 3.26 % 3.47 % LESS: Allowance
for Loan Losses
77,039 75,590 77,228 Cash and due From Banks
(Non-Interest Bearing)
38,062 41,595 41,559 Other Assets
406,799 411,546 347,721
TOTAL
AVERAGE ASSETS $ 6,852,770 $ 6,878,838 $
6,450,055
AVERAGE LIABILITIES, REDEEMABLE
NONCONTROLLINGINTERESTS, AND SHAREHOLDERS' EQUITY
Interest-Bearing Liabilities: Interest-Bearing Deposits: Savings
and NOW
$ 599,695 $ 584,210 $ 545,973
$
103 $ 112 $ 98
0.07 % 0.08 % 0.07 % Money
Market
2,812,827 2,836,731 2,490,836
2,596 2,589
1,845
0.37 % 0.36 % 0.30 % Certificates of Deposit
604,404 597,460 624,547
1,193 1,207 1,273
0.80 % 0.80 %
0.83 % Total Interest-Bearing Deposits
4,016,926 4,018,401
3,661,356
3,892 3,908 3,216
0.39 % 0.39 % 0.36
% Junior Subordinated Debentures
106,363 106,363 106,363
956 976 955
3.59 % 3.59 % 3.59 % FHLB
Borrowings and Other
470,392 447,955
506,864
1,944 2,079 2,343
1.65
% 1.82 % 1.85 % Total Interest-Bearing Liabilities
4,593,681 4,572,719 4,274,583
6,792 6,963 6,514
0.60 % 0.60 %
0.61 % Noninterest Bearing Demand Deposits
1,422,202
1,465,145 1,422,928 Payables and Other Liabilities
102,255 121,318 91,863 Total Average
Liabilities
6,118,138 6,159,182 5,789,374 Redeemable
Noncontrolling Interests
22,748 22,802 20,132 Average
Shareholders' Equity
711,884 696,854
640,549
TOTAL AVERAGE LIABILITIES, REDEEMABLE
NONCONTROLLINGINTERESTS, AND SHAREHOLDERS' EQUITY
$ 6,852,770 $ 6,878,838 $ 6,450,055 Net Interest
Income - on a Fully Taxable Equivalent Basis (FTE)
$
48,597 $ 46,638 $ 46,690 LESS: FTE Adjustment (7)
2,525 2,510 2,168 Net Interest Income (GAAP
Basis)
$ 46,072 $ 44,128 $ 44,522 Interest Rate
Spread
2.82 % 2.66 % 2.86 % Bank only Net Interest
Margin
3.07 % 2.90 % 3.11 % Net Interest Margin
3.00 % 2.83 % 3.04 %
Boston Private
Financial Holdings, Inc.
Selected Financial Data
(Unaudited) (In thousands)
LOAN DATA (9):
3/31/2015 12/31/2014 3/31/2014
Commercial and Industrial Loans: New England
$
786,334 $ 781,646 $ 704,056 San Francisco Bay
122,418
117,105 108,365 Southern California
58,086
54,334 39,780 Total Commercial and Industrial Loans
$
966,838 $ 953,085 $ 852,201 Commercial Real Estate Loans:
New England
$ 684,395 $ 690,965 $ 730,709 San
Francisco Bay
601,305 619,222 644,108 Southern California
477,341 478,216 483,817 Total
Commercial Real Estate Loans
$ 1,763,041 $ 1,788,403
$ 1,858,634 Construction and Land Loans: New England
$
91,764 $ 85,272 $ 94,966 San Francisco Bay
31,012
31,329 62,879 Southern California
14,318 8,748
16,871 Total Construction and Land Loans
$
137,094 $ 125,349 $ 174,716 Residential Loans: New England
$ 1,295,955 $ 1,299,568 $ 1,227,114 San Francisco Bay
459,310 462,497 456,372 Southern California
387,771 370,030 352,369 Total Residential
Loans
$ 2,143,036 $ 2,132,095 $ 2,035,855 Home Equity
Loans: New England
$ 82,716 $ 82,877 $ 77,470 San
Francisco Bay
29,835 27,575 28,159 Southern California
3,639 4,407 3,334 Total Home Equity
Loans
$ 116,190 $ 114,859 $ 108,963 Other Consumer
Loans: New England
$ 156,042 $ 143,166 $ 119,500 San
Francisco Bay
7,245 6,505 7,311 Southern California
5,527 6,474 5,246 Eliminations and other, net
— — 44 Total Other Consumer Loans
$
168,814 $ 156,145 $ 132,101 Total Loans: New England
$ 3,097,206 $ 3,083,494 $ 2,953,815 San Francisco Bay
1,251,125 1,264,233 1,307,194 Southern California
946,682 922,209 901,417 Eliminations and other, net
— — 44 Total Loans
$ 5,295,013 $
5,269,936 $ 5,162,470
Boston Private Financial
Holdings, Inc.
Selected Financial Data (Unaudited) (In
thousands)
CREDIT QUALITY (9): 3/31/2015
12/31/2014 3/31/2014 Special
Mention Loans: New England
$ 47,635 $ 32,254 $ 41,920
San Francisco Bay
16,350 18,161 25,055 Southern California
22,161 26,325 36,452 Total
Special Mention Loans
$ 86,146 $ 76,740 $
103,427 Accruing Substandard Loans (10): New England
$
18,534 $ 11,126 $ 12,319 San Francisco Bay
21,996
23,403 26,294 Southern California
5,472 4,331
3,507 Total Accruing Substandard Loans
$
46,002 $ 38,860 $ 42,120 Nonaccruing Loans: New
England
$ 18,271 $ 26,205 $ 21,569 San Francisco Bay
9,347 13,430 12,541 Southern California
4,515
4,547 7,944 Total Nonaccruing Loans
$
32,133 $ 44,182 $ 42,054 Other Real Estate Owned: New
England
$ 344 $ 344 $ 336 San Francisco Bay
585 585 585 Southern California
— —
— Total Other Real Estate Owned
$ 929 $
929 $ 921 Loans 30-89 Days Past Due and Accruing (11): New
England
$ 18,236 $ 6,572 $ 4,472 San Francisco Bay
3,398 375 2,577 Southern California
3,760
13 3,528 Total Loans 30-89 Days Past Due and
Accruing
$ 25,394 $ 6,960 $ 10,577 Loans
(Charged-off)/ Recovered, Net for the Three Months Ended: New
England
$ 890 $ (2,516 ) $ 540 San Francisco Bay
2,738 607 640 Southern California
297
64 254 Total Net Loans (Charged-off)/ Recovered
$ 3,925 $ (1,845 ) $ 1,434
FOOTNOTES:
(1)
Net income from discontinued
operations consists of contingent payments or expenses related to
our divested affiliates, including Davidson Trust Company; Boston
Private Value Investors, Inc.; Sand Hill Advisors, LLC; RINET
Company, LLC; Gibraltar Private Bank & Trust Company; and
Westfield Capital Management Company, LLC.
(2)
Adjustments to net income attributable to the Company to arrive at
net income attributable to the common shareholders, as presented in
these tables, include decrease/ (increase) in noncontrolling
interests redemption value, dividends paid on preferred stock, and
dividends on participating securities.
(3)
When the Company has positive net income
from continuing operations attributable to the common shareholders,
the Company adds additional shares to basic weighted average shares
outstanding to arrive at diluted weighted average shares
outstanding for the diluted earnings per share calculation. These
additional shares reflect the assumed exercise, conversion, or
contingent issuance of dilutive securities. If the additional
shares would result in anti-dilution they would be excluded from
the diluted earnings per share calculation. The potential dilutive
shares relate to: unexercised stock options, unvested
non-participating restricted stock, and unexercised stock warrants.
See Part II. Item 8. "Financial Statements and Supplementary Data -
Note 16: Earnings Per Share" in the Company's Annual Report on Form
10-K for the year ended December 31, 2014 for additional
information.
(4)
The Company uses certain non-GAAP financial measures, such as:
Tangible Book Value Per Share and the Tangible Common Equity
("TCE") to Tangible Assets ("TA") ratio to provide information for
investors to effectively analyze financial trends of ongoing
business activities, and to enhance comparability with peers across
the financial sector. Reconciliations from the Company's
GAAP Total Equity to Total Assets ratio to the Non-GAAP TCE to TA
ratio, and from GAAP Book Value to Non-GAAP Tangible Book Value are
presented below: The Company calculates Tangible Assets by
adjusting Total Assets to exclude Goodwill and Intangible Assets.
The Company calculates Tangible Common Equity by adjusting
Total Equity to exclude non-convertible Series D Preferred stock
and exclude Goodwill and Intangible Assets, net.
(In thousands,
except per share data)
3/31/2015
12/31/2014 3/31/2014 Total
Balance Sheet Assets
$ 6,869,772 $ 6,797,874 $
6,705,420 LESS: Goodwill and Intangible Assets, net
(190,198 ) (191,800 ) (129,731 )
Tangible Assets (non-GAAP)
$ 6,679,574 $ 6,606,074 $
6,575,689 Total Shareholders' Equity
$ 718,690 $
703,911 $ 645,979 LESS: Series D Preferred Stock (non-convertible)
(47,753 ) (47,753 ) (47,753 ) LESS: Goodwill and
Intangible Assets, net
(190,198 )
(191,800 ) (129,731 ) Total adjusting items
(237,951 ) (239,553 ) (177,484 )
Tangible Common Equity (non-GAAP)
$ 480,739 $
464,358 $ 468,495 Total Equity/Total Assets
10.46 % 10.35 % 9.63 % Tangible Common
Equity/Tangible Assets (non-GAAP)
7.20 % 7.03 % 7.12
% Total Risk Weighted Assets *
$ 5,159,073 $
4,803,633 $ 4,707,604 Tier I Common Equity *
$
503,564 $ 468,612 $ 475,930 Tier I Common Equity/ Risk
Weighted Assets
9.76 % 9.76 % 10.11 % End of
Period Shares Outstanding
83,052 82,962 80,001 Book
Value Per Common Share
$ 8.08 $ 7.91 $ 7.48 Tangible
Book Value Per Share (non-GAAP)
$ 5.79 $ 5.60 $ 5.86
* Risk Weighted Assets and Tier I Common
Equity for March 31, 2015 are presented based on estimated
data.
(5)
The Company uses certain
non-GAAP financial measures, such as: Return on Average Common
Equity and Return on Average Tangible Common Equity to provide
information for investors to effectively analyze financial trends
of ongoing business activities, and to enhance comparability with
peers across the financial sector. Reconciliations from the
Company's GAAP Return on Average Equity ratio to the Non-GAAP
Return on Average Common Equity ratio, and the Non-GAAP Return on
Average Tangible Common Equity ratio are presented below:
The Company calculates Average Common Equity by adjusting Average
Equity to exclude Average Preferred Equity. The Company
calculates Average Tangible Common Equity by adjusting Average
Equity to exclude Average Goodwill and Intangible Assets, net and
Average Preferred Equity.
Three Months Ended
(In thousands)
3/31/2015 12/31/2014
3/31/2014 Total average shareholders' equity
$ 711,884 $ 696,854 $ 640,549 LESS: Average Series D
preferred stock (non-convertible)
(47,753 )
(47,753 ) (47,753 ) Average common equity (non-GAAP)
664,131 649,101 592,796
LESS: Average goodwill and intangible assets, net
(191,053 ) (184,473 ) (130,272 ) Total
adjusting items
(191,053 ) (184,473 )
(130,272 ) Average Tangible Common Equity (non-GAAP)
$ 473,078 $ 464,628 $ 462,524
Net income attributable to the Company
$
18,783 $ 12,177 $ 17,041 LESS: Dividends on Series D
preferred stock
(869 ) (869 )
(869 ) Common net income (non-GAAP)
17,914 11,308 16,172
ADD: Amortization of intangibles, net of tax (35%)
1,042 1,110 684 Tangible
common net income (non-GAAP)
$ 18,956 $ 12,418
$ 16,856 Return on Average Equity -
(Annualized)
10.55 % 6.99 % 10.64 % Return on Average
Common Equity - (Annualized) (non-GAAP)
10.79 % 6.97
% 10.91 % Return on Average Tangible Common Equity - (Annualized)
(non-GAAP)
16.03 % 10.69 % 14.58 %
(6)
The Company uses certain
non-GAAP financial measures, such as: pre-tax, pre-provision
earnings and the efficiency ratio to provide information for
investors to effectively analyze financial trends of ongoing
business activities, and to enhance comparability with peers across
the financial sector.
Reconciliations from the Company's GAAP
income from continuing operations before income taxes to non-GAAP
pre-tax, pre-provision earnings; and from GAAP efficiency ratio to
Non-GAAP efficiency ratio (FTE basis), excluding restructuring, are
presented below:
Three Months Ended
(In thousands)
3/31/2015 12/31/2014
3/31/2014 Income before income taxes (GAAP)
$ 26,490 $ 17,890 $ 23,487 ADD BACK: Provision/
(credit) for loan losses
(2,500 ) 2,400
(1,200 ) Pre-tax, pre-provision earnings (non-GAAP)
$ 23,990 $ 20,290 $ 22,287 Total operating
expense (GAAP)
$ 63,427 $ 63,760 $ 54,968 Less:
Amortization of intangibles
1,603 1,707 1,053 Less:
Restructuring
— 739 —
Total operating expense (excluding amortization of
intangibles and restructuring) (non-GAAP)
$ 61,824 $
61,314 $ 53,915 Net interest income
$ 46,072 $
44,128 $ 44,522 Total core fees and income
40,160 39,609
31,664 Total other income
1,185 313 1,069 FTE income
2,525 2,510 2,168 Total
revenue (FTE basis)
$ 89,942 $ 86,560 $ 79,423
Efficiency Ratio, before deduction of intangible amortization
(GAAP)
72.56 % 75.86 % 71.15 % Efficiency Ratio, FTE
Basis (non-GAAP)
68.74 % 70.83 % 67.88 %
(7)
Interest Income on Non-taxable
Investments and Loans are presented on an FTE basis using the
federal statutory rate of 35% for each period presented.
(8)
Includes Loans Held for Sale and Nonaccrual Loans.
(9)
The concentration of the Private Banking loan data and credit
quality is primarily based on the location of the lender's regional
offices. Net loans from the Company to certain principals of the
Company's affiliate partners, loans at the Company's non-banking
segments, and inter-company loan eliminations are identified as
“Eliminations and other, net”.
(10)
Accruing substandard loans include loans that are classified as
substandard but are still accruing interest income. Boston Private
Bank & Trust Company may classify a loan as substandard where
known information about possible credit problems of the related
borrowers causes management to have doubts as to the ability of
such borrowers to comply with the present repayment terms and which
may result in disclosure of such loans as nonaccrual at some time
in the future.
(11)
In addition to loans 30-89 days past due and accruing, at March 31,
2015 and December 31, 2014 the Company had no loans were more than
90 days past due but still on accrual status. At March 31, 2014,
the Company had three loans totaling $0.6 million that were more
than 90 days past due but still on accrual status. These loans
originated in the New England region.
Boston Private Financial Holdings, Inc.Steven Gaven,
617-912-3793Vice President Corporate Finance and Director of
Investor Relationssgaven@bostonprivate.com
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