Results reflect underlying strength of
franchise
Independent Bank Corp. (Nasdaq Global Select Market: INDB),
parent of Rockland Trust Company, today announced 2024 first
quarter net income of $47.8 million, or $1.12 per diluted share,
compared to 2023 fourth quarter net income of $54.8 million, or
$1.26 per diluted share.
The Company generated a return on average assets of 1.00% and a
return on average common equity of 6.63% for the first quarter of
2024, as compared to 1.13% and 7.51%, respectively, for the prior
quarter.
"Our first quarter results reflect our steady commitment to
focusing on our core fundamentals – disciplined growth, core
funding prioritization, strong credit monitoring, and expense
management. We remain confident that we are well-positioned to
create long term value for our shareholders while successfully
navigating through this challenging macro environment", said
Jeffrey Tengel, the Chief Executive Officer of Independent Bank
Corp. and Rockland Trust Company.
BALANCE SHEET
Total assets of $19.3 billion at March 31, 2024 remained
relatively consistent with the prior quarter level and decreased by
$117.7 million, or 0.6%, as compared to March 31, 2023.
Total loans at March 31, 2024 of $14.3 billion increased by
$52.5 million, or 0.4% (1.5% annualized), compared to the prior
quarter level. This growth was primarily driven by the commercial
real estate loan portfolio, which increased $67.3 million, or 0.8%
(3.4% annualized) for the quarter, primarily reflecting transfers
from the construction portfolio, modest new origination activity,
and reduced levels of paydowns. The small business portfolio also
continued its steady growth, rising by 3.9% during the first
quarter of 2024, while the total consumer real estate portfolio
remained generally in line with the prior quarter.
Deposit levels also resumed growth during the quarter, with
balances of $15.0 billion at March 31, 2024, rising by $177.7
million, or 1.2%, from December 31, 2023. This increase was driven
primarily by municipal deposit inflows and consumer demand for
higher cost time deposits, partially offset by seasonal business
deposit outflows. Though some level of product remixing persists,
total noninterest bearing demand deposits comprised 29.7% of total
deposits at March 31, 2024. Core deposits, inclusive of reciprocal
deposits, represented 83.2% of total deposits at March 31, 2024, as
compared to 84.6% at December 31, 2023. The total cost of deposits
for the first quarter increased 17 basis points to 1.48% compared
to the prior quarter, reflective of the competitive market
environment and ongoing customer preference for higher yielding
accounts.
In conjunction with deposit growth during the quarter, total
borrowings declined by $193.0 million, or 15.8%, during the first
quarter of 2024. The decrease was driven primarily by a reduction
in Federal Home Loan Bank borrowings of $143.0 million, or 12.9%.
Additionally, the Company fully redeemed its outstanding
subordinated debentures with an aggregate principal amount of $50.0
million.
The securities portfolio decreased by $85.1 million, or 2.9%,
compared to December 31, 2023, driven primarily by paydowns,
maturities, and unrealized losses of $4.0 million in the available
for sale portfolio. Total securities represented 14.7% of total
assets at March 31, 2024, as compared to 15.1% at December 31,
2023.
During the first quarter of 2024, the Company repurchased
532,266 shares of its common stock for $31.0 million at an average
price per share of $58.22, marking the completion of its previously
announced $100 million buyback program. Stockholders' equity at
March 31, 2024 remained generally consistent when compared to
December 31, 2023, as the impact of share repurchase activity and
the common dividend declared during the first quarter was offset by
strong earnings. The Company's ratio of common equity to assets of
14.92% at March 31, 2024 represented a decrease of 4 basis points
from December 31, 2023 and an increase of 36 basis points from
March 31, 2023. The Company's book value per share increased by
$0.41, or 0.6%, to $67.94 at March 31, 2024 as compared to the
prior quarter. The Company's tangible book value per share at March
31, 2024 rose by $0.21, or 0.5%, from the prior quarter to $44.34,
and represented an increase of 7.3% from the year ago period. The
Company's ratio of tangible common equity to tangible assets of
10.27% at March 31, 2024 represented a decrease of 4 basis points
from the prior quarter and an increase of 38 basis points from the
year ago period. Please refer to Appendix A for a detailed
reconciliation of Non-GAAP balance sheet metrics.
NET INTEREST INCOME
Net interest income for the first quarter of 2024 decreased 5.3%
to $137.4 million compared to $145.1 million for the prior quarter,
as rising deposit costs continued to counter the benefit of
repriced assets, resulting in a reduction in net interest margin of
15 basis points to 3.23% for the quarter.
NONINTEREST INCOME
Noninterest income of $29.9 million for the first quarter of
2024 represented a decrease of $2.1 million, or 6.6%, as compared
to the prior quarter. Significant changes in noninterest income for
the first quarter of 2024 compared to the prior quarter included
the following:
- Investment management and advisory income increased by
$123,000, or 1.3%, primarily driven by elevated asset-based
revenue, which increased by $277,000, or 3.2%, offset by slightly
lower commission and other revenue. Total assets under
administration increased by $266.1 million, or 4.1%, to a record
level of $6.8 billion at March 31, 2024.
- Mortgage banking income grew by $187,000, or 30.7%, driven
primarily by a greater portion of new originations sold in the
secondary market versus being retained in the Company's
portfolio.
- Loan level derivative income decreased by $722,000, or 90.0%
primarily due to lower demand.
- Other noninterest income decreased by $1.5 million, or 19.8%,
driven primarily by volatility in non-core components, including
lower unrealized gains on equity securities, while the prior
quarter also included an outsized $1.0 million gain from the
purchase of discounted tax credits.
NONINTEREST EXPENSE
Noninterest expense of $99.9 million for the first quarter of
2024 represented a decrease of $860,000, or 0.9%, as compared to
the prior quarter. Significant changes in noninterest expense for
the first quarter compared to the prior quarter included the
following:
- Salaries and employee benefits increased by $786,000, or 1.4%,
due primarily to seasonal increases in payroll taxes, partially
offset by decreased commissions and equity compensation.
- Occupancy and equipment expenses increased by $413,000, or
3.2%, due mainly to seasonal increases in snow removal and
utilities costs, partially offset by one-time lease termination
costs recorded during the fourth quarter of 2023.
- FDIC assessment decreased $1.0 million, or 24.4%, from the
prior quarter, driven primarily by the FDIC special assessment
recognized by the Company.
- Other noninterest expense decreased by $1.2 million, or 4.6%,
due primarily to decreases in consultant fees, advertising, and
subscriptions, partially offset by increased card issuance
costs.
The Company’s tax rate for the first quarter of 2024 increased
to 23.56%, compared to 22.72% for the prior quarter, primarily due
to changes in discrete items realized in both quarters.
ASSET QUALITY
The first quarter provision for credit losses was $5.0 million
as compared to $5.5 million for the fourth quarter of 2023. Net
charge-offs were minimal at $274,000 for the first quarter of 2024,
or 0.01% of average loans annualized, versus $3.8 million, or 0.11%
of average loans annualized, in the prior quarter, with the decline
driven by negligible net charge-offs in the commercial real estate
portfolio in the first quarter. Nonperforming loans increased
slightly to $56.9 million, or 0.40% of total loans at March 31,
2024, as compared to $54.4 million, or 0.38% of total loans at
December 31, 2023. Delinquencies as a percentage of total loans
increased 8 basis points from the prior quarter to 0.52% at March
31, 2024.
The allowance for credit losses on total loans increased to
$146.9 million at March 31, 2024 compared to $142.2 million at
December 31, 2023, and represents 1.03% and 1.00% of total loans,
at March 31, 2024 and December 31, 2023, respectively.
CONFERENCE CALL INFORMATION
Jeffrey Tengel, Chief Executive Officer, and Mark Ruggiero,
Chief Financial Officer and Executive Vice President of Consumer
Lending, will host a conference call to discuss first quarter
earnings at 10:00 a.m. Eastern Time on Friday, April 19, 2024.
Internet access to the call is available on the Company’s website
at https://INDB.RocklandTrust.com or
via telephonic access by dial-in at 1-888-336-7153 reference: INDB.
A replay of the call will be available by calling 1-877-344-7529,
Replay Conference Number: 5035315 and will be available through
April 26, 2024. Additionally, a webcast replay will be available on
the Company's website until April 19, 2025.
ABOUT INDEPENDENT BANK CORP.
Independent Bank Corp. (NASDAQ Global Select Market: INDB) is
the holding company for Rockland Trust Company, a full-service
commercial bank headquartered in Massachusetts. With retail
branches in Eastern Massachusetts and Worcester County as well as
commercial banking and investment management offices in
Massachusetts and Rhode Island, Rockland Trust offers a wide range
of banking, investment, and insurance services to individuals,
families, and businesses. The Bank also offers a full suite of
mobile, online, and telephone banking services. Rockland Trust is
an FDIC member and an Equal Housing Lender.
This press release contains certain “forward-looking statements”
within the meaning of the Private Securities Litigation Reform Act
of 1995 with respect to the financial condition, results of
operations and business of the Company. These statements may be
identified by such forward-looking terminology as “expect,”
“achieve,” “plan,” “believe,” “future,” “positioned,” “continued,”
“will,” “would,” “potential,” or similar statements or variations
of such terms. Actual results may differ from those contemplated by
these forward-looking statements.
Factors that may cause actual results to differ materially from
those contemplated by such forward-looking statements include, but
are not limited to:
- adverse economic conditions in the regional and local economies
within the New England region and the Company’s market area;
- events impacting the financial services industry, including
high profile bank failures, and any resulting decreased confidence
in banks among depositors, investors, and other counterparties, as
well as competition for deposits, significant disruption,
volatility and depressed valuations of equity and other securities
of banks in the capital markets;
- the effects to the Company of an increasingly competitive labor
market, including the possibility that the Company will have to
devote significant resources to attract and retain qualified
personnel;
- the instability or volatility in financial markets and
unfavorable domestic or global general economic, political or
business conditions, whether caused by geopolitical concerns,
including the Russia/Ukraine conflict, the conflict in Israel and
surrounding areas and the possible expansion of such conflicts,
changes in U.S. and international trade policies, or other factors,
and the potential impact of such factors on the Company and its
customers, including the potential for decreases in deposits and
loan demand, unanticipated loan delinquencies, loss of collateral
and decreased service revenues;
- unanticipated loan delinquencies, loss of collateral, decreased
service revenues, and other potential negative effects on the
Company’s local economies or the Company's business caused by
adverse weather conditions and natural disasters, changes in
climate, public health crises or other external events and any
actions taken by governmental authorities in response to any such
events;
- adverse changes or volatility in the local real estate
market;
- changes in interest rates and any resulting impact on interest
earning assets and/or interest bearing liabilities, the level of
voluntary prepayments on loans and the receipt of payments on
mortgage-backed securities, decreased loan demand or increased
difficulty in the ability of borrowers to repay variable rate
loans;
- acquisitions may not produce results at levels or within time
frames originally anticipated and may result in unforeseen
integration issues or impairment of goodwill and/or other
intangibles;
- the effect of laws, regulations, new requirements or
expectations, or additional regulatory oversight in the highly
regulated financial services industry, including as a result of
intensified regulatory scrutiny in the aftermath of certain bank
failures in 2023 and the resulting need to invest in technology to
meet heightened regulatory expectations, increased costs of
compliance or required adjustments to strategy;
- changes in trade, monetary and fiscal policies and laws,
including interest rate policies of the Board of Governors of the
Federal Reserve System;
- higher than expected tax expense, including as a result of
failure to comply with general tax laws and changes in tax
laws;
- increased competition in the Company’s market areas, including
competition that could impact deposit gathering, retention of
deposits and the cost of deposits, increased competition due to the
demand for innovative products and service offerings, and
competition from non-depository institutions which may be subject
to fewer regulatory constraints and lower cost structures;
- a deterioration in the conditions of the securities
markets;
- a deterioration of the credit rating for U.S. long-term
sovereign debt or uncertainties surrounding the federal
budget;
- inability to adapt to changes in information technology,
including changes to industry accepted delivery models driven by a
migration to the internet as a means of service delivery, including
any inability to effectively implement new technology-driven
products, such as artificial intelligence;
- electronic or other fraudulent activity within the financial
services industry, especially in the commercial banking
sector;
- adverse changes in consumer spending and savings habits;
- the effect of laws and regulations regarding the financial
services industry, including the need to invest in technology to
meet heightened regulatory expectations or introduction of new
requirements or expectations resulting in increased costs of
compliance or required adjustments to strategy;
- changes in laws and regulations (including laws and regulations
concerning taxes, banking, securities and insurance) generally
applicable to the Company’s business and the associated costs of
such changes;
- the Company's potential judgments, claims, damages, penalties,
fines and reputational damage resulting from pending or future
litigation and regulatory and government actions;
- changes in accounting policies, practices and standards, as may
be adopted by the regulatory agencies as well as the Public Company
Accounting Oversight Board, the Financial Accounting Standards
Board, and other accounting standard setters;
- operational risks related to cyber threats, attacks,
intrusions, and fraud which could lead to interruptions or
disruptions of the Company's operating systems, including systems
that are customer facing, and adversely impact the Company's
business; and
- any unexpected material adverse changes in the Company's
operations or earnings.
The Company wishes to caution readers not to place undue
reliance on any forward-looking statements as the Company’s
business and its forward-looking statements involve substantial
known and unknown risks and uncertainties described in the
Company’s Annual Report on Form 10-K and subsequent Quarterly
Reports on Form 10-Q ("Risk Factors"). Except as required by law,
the Company disclaims any intent or obligation to update publicly
any such forward-looking statements, whether in response to new
information, future events or otherwise. Any public statements or
disclosures by the Company following this release which modify or
impact any of the forward-looking statements contained in this
release will be deemed to modify or supersede such statements in
this release. In addition to the information set forth in this
press release, you should carefully consider the Risk Factors.
This press release and the appendices attached to it contain
financial information determined by methods other than in
accordance with accounting principles generally accepted in the
United States of America ("GAAP"). This information may include
operating net income and operating earnings per share ("EPS"),
operating return on average assets, operating return on average
common equity, operating return on average tangible common equity,
core net interest margin ("core margin"), tangible book value per
share and the tangible common equity ratio.
Operating net income, operating EPS, operating return on average
assets and operating return on average common equity, exclude items
that management believes are unrelated to the Company's core
banking business such as merger and acquisition expenses, and other
items, if applicable. Management uses operating net income and
related ratios and operating EPS to measure the strength of the
Company’s core banking business and to identify trends that may to
some extent be obscured by such items. Management reviews its core
margin to determine any items that may impact the net interest
margin that may be one-time in nature or not reflective of its core
operating environment, such as significant purchase accounting
adjustments or other adjustments such as nonaccrual interest
reversals/recoveries and prepayment penalties. Management believes
that adjusting for these items to arrive at a core margin provides
additional insight into the operating environment and how
management decisions impact the net interest margin.
Management also supplements its evaluation of financial
performance with analysis of tangible book value per share (which
is computed by dividing stockholders' equity less goodwill and
identifiable intangible assets, or "tangible common equity", by
common shares outstanding), the tangible common equity ratio (which
is computed by dividing tangible common equity by "tangible
assets", defined as total assets less goodwill and other
intangibles), and return on average tangible common equity (which
is computed by dividing net income by average tangible common
equity). The Company has included information on tangible book
value per share, the tangible common equity ratio and return on
average tangible common equity because management believes that
investors may find it useful to have access to the same analytical
tools used by management. As a result of merger and acquisition
activity, the Company has recognized goodwill and other intangible
assets in conjunction with business combination accounting
principles. Excluding the impact of goodwill and other intangibles
in measuring asset and capital values for the ratios provided,
along with other bank standard capital ratios, provides a framework
to compare the capital adequacy of the Company to other companies
in the financial services industry.
These non-GAAP measures should not be viewed as a substitute for
operating results and other financial measures determined in
accordance with GAAP. An item which management excludes when
computing these non-GAAP measures can be of substantial importance
to the Company’s results for any particular quarter or year. The
Company’s non-GAAP performance measures, including operating net
income, operating EPS, operating return on average assets,
operating return on average common equity, core margin, tangible
book value per share and the tangible common equity ratio, are not
necessarily comparable to non-GAAP performance measures which may
be presented by other companies.
Category: Earnings Releases
INDEPENDENT BANK
CORP. FINANCIAL SUMMARY
CONSOLIDATED BALANCE SHEETS
(Unaudited, dollars in thousands)
% Change
% Change
March 31 2024
December 31
2023
March 31 2023
Mar 2024 vs.
Mar 2024 vs.
Dec 2023
Mar 2023
Assets
Cash and due from banks
$
165,331
$
178,861
$
179,923
(7.56)%
(8.11)%
Interest-earning deposits with banks
55,985
45,469
322,621
23.13%
(82.65)%
Securities
Trading
4,759
4,987
4,469
(4.57)%
6.49%
Equities
22,858
22,510
21,503
1.55%
6.30%
Available for sale
1,272,831
1,334,256
1,405,602
(4.60)%
(9.45)%
Held to maturity
1,545,267
1,569,107
1,678,376
(1.52)%
(7.93)%
Total securities
2,845,715
2,930,860
3,109,950
(2.91)%
(8.50)%
Loans held for sale
11,340
6,368
1,130
78.08%
903.54%
Loans
Commercial and industrial
1,580,041
1,579,986
1,649,882
—%
(4.23)%
Commercial real estate
8,108,836
8,041,508
7,820,094
0.84%
3.69%
Commercial construction
828,900
849,586
1,046,310
(2.43)%
(20.78)%
Small business
261,690
251,956
225,866
3.86%
15.86%
Total commercial
10,779,467
10,723,036
10,742,152
0.53%
0.35%
Residential real estate
2,420,705
2,424,754
2,095,644
(0.17)%
15.51%
Home equity - first position
507,356
518,706
556,534
(2.19)%
(8.84)%
Home equity - subordinate positions
593,230
578,920
534,221
2.47%
11.05%
Total consumer real estate
3,521,291
3,522,380
3,186,399
(0.03)%
10.51%
Other consumer
29,836
32,654
19,401
(8.63)%
53.79%
Total loans
14,330,594
14,278,070
13,947,952
0.37%
2.74%
Less: allowance for credit losses
(146,948
)
(142,222
)
(159,131
)
3.32%
(7.66)%
Net loans
14,183,646
14,135,848
13,788,821
0.34%
2.86%
Federal Home Loan Bank stock
46,304
43,557
40,303
6.31%
14.89%
Bank premises and equipment, net
192,563
193,049
195,921
(0.25)%
(1.71)%
Goodwill
985,072
985,072
985,072
—%
—%
Other intangible assets
16,626
18,190
23,253
(8.60)%
(28.50)%
Cash surrender value of life insurance
policies
298,352
297,387
295,268
0.32%
1.04%
Other assets
523,679
512,712
500,140
2.14%
4.71%
Total assets
$
19,324,613
$
19,347,373
$
19,442,402
(0.12)%
(0.61)%
Liabilities and Stockholders'
Equity
Deposits
Noninterest-bearing demand deposits
$
4,469,820
$
4,567,083
$
5,083,678
(2.13)%
(12.08)%
Savings and interest checking
5,196,195
5,298,913
5,638,781
(1.94)%
(7.85)%
Money market
2,944,221
2,818,072
3,094,362
4.48%
(4.85)%
Time certificates of deposit
2,432,985
2,181,479
1,455,351
11.53%
67.18%
Total deposits
15,043,221
14,865,547
15,272,172
1.20%
(1.50)%
Borrowings
Federal Home Loan Bank borrowings
962,535
1,105,541
879,628
(12.94)%
9.43%
Junior subordinated debentures, net
62,858
62,858
62,856
—%
—%
Subordinated debentures, net
—
49,980
49,909
(100.00)%
(100.00)%
Total borrowings
1,025,393
1,218,379
992,393
(15.84)%
3.33%
Total deposits and borrowings
16,068,614
16,083,926
16,264,565
(0.10)%
(1.20)%
Other liabilities
371,791
368,196
346,928
0.98%
7.17%
Total liabilities
16,440,405
16,452,122
16,611,493
(0.07)%
(1.03)%
Stockholders' equity
Common stock
422
427
439
(1.17)%
(3.87)%
Additional paid in capital
1,902,063
1,932,163
1,995,077
(1.56)%
(4.66)%
Retained earnings
1,101,061
1,077,488
971,338
2.19%
13.36%
Accumulated other comprehensive loss, net
of tax
(119,338
)
(114,827
)
(135,945
)
3.93%
(12.22)%
Total stockholders' equity
2,884,208
2,895,251
2,830,909
(0.38)%
1.88%
Total liabilities and stockholders'
equity
$
19,324,613
$
19,347,373
$
19,442,402
(0.12)%
(0.61)%
CONSOLIDATED STATEMENTS OF
INCOME
(Unaudited, dollars in thousands, except
per share data)
Three Months Ended
% Change
% Change
March 31 2024
December 31
2023
March 31 2023
Mar 2024 vs.
Mar 2024 vs.
Dec 2023
Mar 2023
Interest income
Interest on federal funds sold and
short-term investments
$
483
$
304
$
665
58.88%
(27.37)%
Interest and dividends on securities
14,232
14,631
15,310
(2.73)%
(7.04)%
Interest and fees on loans
193,226
192,178
170,926
0.55%
13.05%
Interest on loans held for sale
104
57
34
82.46%
205.88%
Total interest income
208,045
207,170
186,935
0.42%
11.29%
Interest expense
Interest on deposits
54,320
49,456
22,675
9.84%
139.56%
Interest on borrowings
16,286
12,618
5,262
29.07%
209.50%
Total interest expense
70,606
62,074
27,937
13.74%
152.73%
Net interest income
137,439
145,096
158,998
(5.28)%
(13.56)%
Provision for credit losses
5,000
5,500
7,250
(9.09)%
(31.03)%
Net interest income after provision for
credit losses
132,439
139,596
151,748
(5.13)%
(12.72)%
Noninterest income
Deposit account fees
6,228
6,126
5,916
1.67%
5.27%
Interchange and ATM fees
4,452
4,638
4,184
(4.01)%
6.41%
Investment management and advisory
9,941
9,818
9,779
1.25%
1.66%
Mortgage banking income
796
609
308
30.71%
158.44%
Increase in cash surrender value of life
insurance policies
1,928
2,091
1,854
(7.80)%
3.99%
Gain on life insurance benefits
263
180
11
46.11%
2,290.91%
Loan level derivative income
80
802
408
(90.02)%
(80.39)%
Other noninterest income
6,255
7,803
5,782
(19.84)%
8.18%
Total noninterest income
29,943
32,067
28,242
(6.62)%
6.02%
Noninterest expenses
Salaries and employee benefits
57,174
56,388
56,975
1.39%
0.35%
Occupancy and equipment expenses
13,467
13,054
12,822
3.16%
5.03%
Data processing and facilities
management
2,483
2,423
2,527
2.48%
(1.74)%
FDIC assessment
2,982
3,942
2,610
(24.35)%
14.25%
Other noninterest expenses
23,781
24,940
23,727
(4.65)%
0.23%
Total noninterest expenses
99,887
100,747
98,661
(0.85)%
1.24%
Income before income taxes
62,495
70,916
81,329
(11.87)%
(23.16)%
Provision for income taxes
14,725
16,113
20,082
(8.61)%
(26.68)%
Net Income
$
47,770
$
54,803
$
61,247
(12.83)%
(22.00)%
Weighted average common shares (basic)
42,553,714
43,474,734
45,004,100
Common share equivalents
12,876
9,474
19,564
Weighted average common shares
(diluted)
42,566,590
43,484,208
45,023,664
Basic earnings per share
$
1.12
$
1.26
$
1.36
(11.11)%
(17.65)%
Diluted earnings per share
$
1.12
$
1.26
$
1.36
(11.11)%
(17.65)%
(1) The net tax benefit associated with
noncore items is determined by assessing whether each noncore item
is included or excluded from net taxable income and applying the
Company's combined marginal tax rate to only those items included
in net taxable income.
Performance
ratios
Net interest margin (FTE)
3.23
%
3.38
%
3.79
%
Return on average assets (calculated by
dividing net income by average assets) (GAAP)
1.00
%
1.13
%
1.30
%
Return on average common equity
(calculated by dividing net income by average common equity)
(GAAP)
6.63
%
7.51
%
8.63
%
Return on average tangible common equity
(Non-GAAP) (calculated by dividing net income by average tangible
common equity)
10.15
%
11.50
%
13.30
%
Noninterest income as a % of total revenue
(calculated by dividing total noninterest income by net interest
income plus total noninterest income)
17.89
%
18.10
%
15.08
%
Efficiency ratio (calculated by dividing
total noninterest expense by total revenue)
59.68
%
56.87
%
52.69
%
ASSET
QUALITY
(Unaudited, dollars in thousands)
Nonperforming Assets
At
March 31 2024
December 31
2023
March 31 2023
Nonperforming loans
Commercial & industrial loans
$
17,640
$
20,188
$
26,343
Commercial real estate loans
24,213
22,952
18,038
Small business loans
316
398
242
Residential real estate loans
9,947
7,634
8,178
Home equity
4,805
3,171
3,305
Other consumer
20
40
129
Total nonperforming loans
56,941
54,383
56,235
Other real estate owned
110
110
—
Total nonperforming assets
$
57,051
$
54,493
$
56,235
Nonperforming loans/gross loans
0.40
%
0.38
%
0.40
%
Nonperforming assets/total assets
0.30
%
0.28
%
0.29
%
Allowance for credit losses/nonperforming
loans
258.07
%
261.52
%
282.98
%
Allowance for credit losses/total
loans
1.03
%
1.00
%
1.14
%
Delinquent loans/total loans
0.52
%
0.44
%
0.27
%
Nonperforming Assets
Reconciliation for the Three Months Ended
March 31 2024
December 31
2023
March 31 2023
Nonperforming assets beginning balance
$
54,493
$
39,281
$
54,881
New to nonperforming
19,258
31,823
5,416
Loans charged-off
(881
)
(4,182
)
(815
)
Loans paid-off
(6,982
)
(10,905
)
(1,915
)
Loans restored to performing status
(8,855
)
(1,534
)
(1,352
)
Other
18
10
20
Nonperforming assets ending balance
$
57,051
$
54,493
$
56,235
Net Charge-Offs
(Recoveries)
Three Months Ended
March 31 2024
December 31
2023
March 31 2023
Net charge-offs (recoveries)
Commercial and industrial loans
$
(85
)
$
80
$
276
Commercial real estate loans
—
2,783
—
Small business loans
70
267
(3
)
Home equity
(133
)
23
(16
)
Other consumer
422
694
281
Total net charge-offs (recoveries)
$
274
$
3,847
$
538
Net charge-offs (recoveries) to average
loans (annualized)
0.01
%
0.11
%
0.02
%
BALANCE SHEET AND CAPITAL
RATIOS
March 31 2024
December 31
2023
March 31 2023
Gross loans/total deposits
95.26
%
96.05
%
91.33
%
Common equity tier 1 capital ratio (1)
14.16
%
14.19
%
13.83
%
Tier 1 leverage capital ratio (1)
10.95
%
10.97
%
10.78
%
Common equity to assets ratio GAAP
14.92
%
14.96
%
14.56
%
Tangible common equity to tangible assets
ratio (2)
10.27
%
10.31
%
9.89
%
Book value per share GAAP
$
67.94
$
67.53
$
64.17
Tangible book value per share (2)
$
44.34
$
44.13
$
41.31
(1) Estimated number for March 31, 2024.
(2) See Appendix A for detailed reconciliation from GAAP to
Non-GAAP ratios.
INDEPENDENT BANK
CORP. SUPPLEMENTAL FINANCIAL INFORMATION
(Unaudited, dollars in thousands)
Three Months Ended
March 31, 2024
December 31, 2023
March 31, 2023
Interest
Interest
Interest
Average
Earned/
Yield/
Average
Earned/
Yield/
Average
Earned/
Yield/
Balance
Paid (1)
Rate
Balance
Paid (1)
Rate
Balance
Paid (1)
Rate
Interest-earning assets
Interest-earning deposits with banks,
federal funds sold, and short term investments
$
50,583
$
483
3.84
%
$
42,391
$
304
2.85
%
$
73,608
$
665
3.66
%
Securities
Securities - trading
4,779
—
—
%
4,509
—
—
%
4,095
—
—
%
Securities - taxable investments
2,867,460
14,231
2.00
%
2,923,983
14,629
1.98
%
3,117,024
15,309
1.99
%
Securities - nontaxable investments
(1)
190
2
4.23
%
186
2
4.27
%
193
2
4.20
%
Total securities
$
2,872,429
$
14,233
1.99
%
$
2,928,678
$
14,631
1.98
%
$
3,121,312
$
15,311
1.99
%
Loans held for sale
7,095
104
5.90
%
3,614
57
6.26
%
2,474
34
5.57
%
Loans
Commercial and industrial (1)
1,559,978
27,629
7.12
%
1,600,886
28,990
7.18
%
1,618,330
26,572
6.66
%
Commercial real estate (1)
8,110,813
102,054
5.06
%
7,956,103
100,331
5.00
%
7,773,007
89,581
4.67
%
Commercial construction
842,480
15,421
7.36
%
895,313
15,932
7.06
%
1,134,469
16,467
5.89
%
Small business
257,022
4,160
6.51
%
246,411
3,956
6.37
%
222,543
3,219
5.87
%
Total commercial
10,770,293
149,264
5.57
%
10,698,713
149,209
5.53
%
10,748,349
135,839
5.13
%
Residential real estate
2,418,617
26,083
4.34
%
2,380,706
24,712
4.12
%
2,056,524
19,358
3.82
%
Home equity
1,094,856
18,444
6.78
%
1,097,233
18,747
6.78
%
1,089,056
16,244
6.05
%
Total consumer real estate
3,513,473
44,527
5.10
%
3,477,939
43,459
4.96
%
3,145,580
35,602
4.59
%
Other consumer
30,669
609
7.99
%
32,141
667
8.23
%
32,767
577
7.14
%
Total loans
$
14,314,435
$
194,400
5.46
%
$
14,208,793
$
193,335
5.40
%
$
13,926,696
$
172,018
5.01
%
Total interest-earning assets
$
17,244,542
$
209,220
4.88
%
$
17,183,476
$
208,327
4.81
%
$
17,124,090
$
188,028
4.45
%
Cash and due from banks
177,506
178,100
181,402
Federal Home Loan Bank stock
47,203
37,054
14,714
Other assets
1,809,640
1,883,317
1,844,556
Total assets
$
19,278,891
$
19,281,947
$
19,164,762
Interest-bearing liabilities
Deposits
Savings and interest checking accounts
$
5,165,866
$
14,856
1.16
%
$
5,323,667
$
14,315
1.07
%
$
5,745,357
$
7,473
0.53
%
Money market
2,844,014
15,991
2.26
%
2,851,343
15,197
2.11
%
3,243,322
10,393
1.30
%
Time deposits
2,297,219
23,473
4.11
%
2,103,666
19,944
3.76
%
1,293,987
4,809
1.51
%
Total interest-bearing deposits
$
10,307,099
$
54,320
2.12
%
$
10,278,676
$
49,456
1.91
%
$
10,282,666
$
22,675
0.89
%
Borrowings
Federal Home Loan Bank borrowings
1,185,296
14,631
4.96
%
884,441
10,836
4.86
%
298,413
3,644
4.95
%
Junior subordinated debentures
62,858
1,147
7.34
%
62,857
1,164
7.35
%
62,856
1,001
6.46
%
Subordinated debentures
40,651
508
5.03
%
49,968
618
4.91
%
49,897
617
5.01
%
Total borrowings
$
1,288,805
$
16,286
5.08
%
$
997,266
$
12,618
5.02
%
$
411,166
$
5,262
5.19
%
Total interest-bearing liabilities
$
11,595,904
$
70,606
2.45
%
$
11,275,942
$
62,074
2.18
%
$
10,693,832
$
27,937
1.06
%
Noninterest-bearing demand deposits
4,439,107
4,704,888
5,219,531
Other liabilities
347,573
406,029
374,195
Total liabilities
$
16,382,584
$
16,386,859
$
16,287,558
Stockholders' equity
2,896,307
2,895,088
2,877,204
Total liabilities and stockholders'
equity
$
19,278,891
$
19,281,947
$
19,164,762
Net interest income
$
138,614
$
146,253
$
160,091
Interest rate spread (2)
2.43
%
2.63
%
3.39
%
Net interest margin (3)
3.23
%
3.38
%
3.79
%
Supplemental
Information
Total deposits, including demand
deposits
$
14,746,206
$
54,320
$
14,983,564
$
49,456
$
15,502,197
$
22,675
Cost of total deposits
1.48
%
1.31
%
0.59
%
Total funding liabilities, including
demand deposits
$
16,035,011
$
70,606
$
15,980,830
$
62,074
$
15,913,363
$
27,937
Cost of total funding liabilities
1.77
%
1.54
%
0.71
%
(1) The total amount of adjustment to present interest income
and yield on a fully tax-equivalent basis was $1.2 million for both
the three months ended March 31, 2024 and December 31, 2023, and
$1.1 million for the three months ended and March 31, 2023,
determined by applying the Company's marginal tax rates in effect
during each respective quarter. (2) Interest rate spread represents
the difference between weighted average yield on interest-earning
assets and the weighted average cost of interest-bearing
liabilities. (3) Net interest margin represents annualized net
interest income as a percentage of average interest-earning
assets.
APPENDIX A: NON-GAAP Reconciliation of
Balance Sheet Metrics
(Unaudited, dollars in thousands, except per share data)
The following table summarizes the calculation of the Company's
tangible common equity to tangible assets ratio and tangible book
value per share, at the dates indicated:
March 31 2024
December 31
2023
March 31 2023
Tangible common equity
(Dollars in thousands, except per
share data)
Stockholders' equity (GAAP)
$
2,884,208
$
2,895,251
$
2,830,909
(a)
Less: Goodwill and other intangibles
1,001,698
1,003,262
1,008,325
Tangible common equity (Non-GAAP)
$
1,882,510
$
1,891,989
$
1,822,584
(b)
Tangible assets
Assets (GAAP)
$
19,324,613
$
19,347,373
$
19,442,402
(c)
Less: Goodwill and other intangibles
1,001,698
1,003,262
1,008,325
Tangible assets (Non-GAAP)
$
18,322,915
$
18,344,111
$
18,434,077
(d)
Common Shares
42,452,457
42,873,187
44,114,827
(e)
Common equity to assets ratio (GAAP)
14.92
%
14.96
%
14.56
%
(a/c)
Tangible common equity to tangible assets
ratio (Non-GAAP)
10.27
%
10.31
%
9.89
%
(b/d)
Book value per share (GAAP)
$
67.94
$
67.53
$
64.17
(a/e)
Tangible book value per share
(Non-GAAP)
$
44.34
$
44.13
$
41.31
(b/e)
APPENDIX B: Non-GAAP Reconciliation of
Earnings Metrics
(Unaudited, dollars in thousands)
The following table summarizes the calculation of the Company's
return on average tangible common equity for the periods
indicated:
Three Months Ended
March 31 2024
December 31
2023
March 31 2023
Net income (GAAP)
$
47,770
$
54,803
$
61,247
Average common equity (GAAP)
$
2,896,307
$
2,895,088
$
2,877,204
Less: Average goodwill and other
intangibles
1,002,506
1,004,081
1,009,340
Tangible average tangible common equity
(Non-GAAP)
$
1,893,801
$
1,891,007
$
1,867,864
Return on average tangible common equity
(Non-GAAP) (calculated by dividing annualized net income by average
tangible common equity)
10.15
%
11.50
%
13.30
%
APPENDIX C: Net Interest Margin
Analysis & Non-GAAP Reconciliation of Core
Margin
Three Months Ended
March 31, 2024
December 31, 2023
Volume
Interest
Margin Impact
Volume
Interest
Margin Impact
(Dollars in thousands)
Reported total interest earning assets
$
17,244,542
$
138,614
3.23
%
$
17,183,476
$
146,253
3.38
%
Acquisition fair value marks:
Loan accretion
(109
)
(1,156
)
CD amortization
9
11
(100
)
—
%
(1,145
)
(0.03
)%
Nonaccrual interest, net
(341
)
(0.01
)%
549
0.01
%
Other noncore adjustments
(4,460
)
(582
)
(0.01
)%
(4,913
)
(574
)
(0.01
)%
Core margin (Non-GAAP)
$
17,240,082
$
137,591
3.21
%
$
17,178,563
$
145,083
3.35
%
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240417517437/en/
Jeffrey Tengel President and Chief Executive Officer (781)
982-6144 Mark J. Ruggiero Chief Financial Officer and Executive
Vice President of Consumer Lending (781) 982-6281
Independent Bank (NASDAQ:INDB)
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