BOSTON, July 23, 2019 /PRNewswire/ -- Berkshire
Hills Bancorp, Inc. (NYSE: BHLB) reported GAAP net income of
$25 million, or $0.52 per share, in the second quarter of
2019. The non-GAAP measure of core earnings totaled
$32 million, or $0.65 per share. Net non-core charges were
primarily related to the acquisition of Willimantic, CT based SI Financial Group, Inc.
on May 17, 2019 and are net of
discontinued operations. GAAP EPS increased by 2% compared to
the prior quarter, while core EPS increased by 8% due to the
benefits of the Company's initiatives.
SECOND QUARTER FINANCIAL HIGHLIGHTS (income
statement metrics are compared to the prior quarter):
- 2% increase in GAAP EPS; 8% increase in core EPS
- 2% increase in net revenue from continuing operations
- 3.19% net interest margin
- 56.4% efficiency ratio, improved from 59.5%
- 0.14% net loan charge-offs/average loans
- 0.27% non-performing assets/assets
CEO Richard Marotta stated, "Our
teams had a good quarter and contributed to improving the
profitability of our operations based on revenue driven positive
operating leverage. Several critical initiatives were
accomplished in the most recent quarter. We completed the
acquisition of SI Financial Group, which added the Savings
Institute operations consisting of 23 branches and $1.7 billion in total assets in eastern
Connecticut and Rhode Island. This was completed on time
and on plan, including the issuance of 5.7 million Berkshire shares as merger
consideration. The systems conversion remains targeted for
early in the fourth quarter."
Mr. Marotta continued, "We completed our strategic review and
moved forward on several fronts. Our commercial aircraft
portfolio is in the process of being sold, and our FCLS national
mortgage banking operations are being marketed for sale.
We're seeing the benefits of our efficiency initiatives, and we're
also investing in targeted areas, including our growing SBA lending
team. Repurchases of common stock have begun under our
recent 2.4 million share repurchase authorization."
Mr. Marotta concluded with comments about recent governance and
culture initiatives. "We were pleased to add three new Board
members in June: Baye
Adofo-Wilson, Rheo
Brouillard, and William
Hughes. They represent our newer markets, enhance our
diversity, and add new expertise in technology and community
development finance. Longtime community organizer and
activist, Malia Lazu, was appointed
as EVP/Chief Experience and Culture Officer, and SVP Jacqueline
Courtwright was promoted to Chief Human Resources Officer. In
May, the Bank announced its Be FIRST values program, including
initiatives for new community storefronts based around our MyBanker
program, a new community deposit and loan product, and enhanced
diversity and inclusion programs for employee recruitment and
development. In June, over 90% of our employees joined
together in our fourth annual Xtraordinary Day of Service, donating
more than 6,000 hours of service at 37 projects throughout our
footprint. Berkshire Bank was recently named as the winner of
the 2019 North American Employee Engagement Award for Social
Responsibility."
DIVIDEND DECLARED
The Board of Directors approved a quarterly cash dividend of
$0.23 per common share to
shareholders of record at the close of business on August 8, 2019, payable on August 22, 2019. The dividend equates to a
3.1% annualized yield based on the $29.85 average closing price of Berkshire Hills
Bancorp during the second quarter of 2019. Effective on the
same dates, the Board also approved a quarterly cash dividend on
preferred stock totaling $0.46 per
share. The Board had approved a 5% increase in the common and
preferred dividend following the start of the year.
ACQUISITION OF SI FINANCIAL GROUP
Berkshire completed the
acquisition of SI Financial Group ("SIFI") on May 17, 2019. At the acquisition date, SIFI
had assets with a gross fair value totaling $1.7 billion and a net fair value of $140 million net of liabilities.
Berkshire recorded $176 million in total merger consideration,
consisting primarily of the issuance of 5.69 million Berkshire common shares. Goodwill
was recorded in the amount of $35
million, and the core deposit intangible was recorded at
$18 million. For the first
quarter of 2019, SIFI reported $57
million in annualized revenue and $39
million in annualized operating expense. For that
period, it recorded a 3.00% net interest margin, with a 4.35% loan
yield and a 1.29% interest-bearing deposit cost. Most
Berkshire consolidated balance sheet and income statement
categories increased as a result of the merger.
Berkshire targets to achieve
cost savings related efficiencies totaling approximately
$12 million, or 30% of SIFI
annualized non-interest expense. The Company continues to
expect that it will remain within its target of approximately
$23 million in total after-tax
transaction costs. Including all purchase accounting and
targeted transaction costs the Company estimates that the
transaction will be approximately $0.45 dilutive to tangible book value per share.
Projected dilution per share is less than originally
anticipated due to changes in market conditions affecting purchase
accounting.
FINANCIAL CONDITION
Total assets were $13.7 billion at
midyear 2019, increasing by $1.5
billion, or 12%, during the quarter and including the SIFI
merger. Investment securities increased by $24 million, or 1%. The SIFI merger added
$143 million and there were
$119 million in net reductions as a
result of the Company's strategic review, along with the
integration of the SIFI securities. Total loans increased in
the second quarter by $1.0 billion,
or 11%, to $9.9 billion including
$1.3 billion in SIFI loans. The
$178 million portfolio of commercial
aircraft loans was designated as held-for-sale. The Company
expects to complete the sale of these loans in the third
quarter. Total loans decreased organically in the quarter and
year-to-date. This reflects the Company's strategic review
and emphasis on adjusting the level and mix of assets to improve
capital returns and to integrate the acquired SIFI portfolio.
Total deposits increased by $1.4
billion, or 15%, in the second quarter to $10.6 billion including $1.3 billion in SIFI deposits. Payroll
related balances decreased by $82
million to $480 million in the
second quarter. Deposits increased organically before changes
related to SIFI and payroll accounts. Ratio metrics of
capital, liquidity, and asset quality improved modestly during the
most recent quarter. The SIFI loans were recorded at a
$42 million (or 3.1%) discount to
gross carrying value, including a $31
million credit discount and an $11
million interest rate discount. Near quarter-end, the
Company initiated purchases of common stock under its recently
approved 2.4 million share repurchase program. The Company
repurchased 110 thousand shares in the second quarter and
repurchases are expected to continue. Book value per
common share increased by 1% to $34.05 from $33.75
in the most recent quarter, and the non-GAAP measure of tangible
book value per common share increased by 3% to $22.25 from $21.66,
more than offsetting the dilution from the acquisition.
RESULTS OF OPERATIONS
GAAP earnings were $0.52 per share in the most recent
quarter, compared to $0.51 in the
prior quarter. Results in the second quarter were reduced by
non-core charges related to the SIFI acquisition, restructuring
charges, and discontinued operations.
The non-GAAP measure of core earnings totaled $0.65 per share in the most recent quarter,
increasing by 8% from $0.60 in the
prior quarter. Revenue driven positive operating leverage
contributed to improving core profitability. This reflected
initial benefits from the SIFI acquisition and the Company's
strategic initiatives. The return on equity measured 6.1% in
the most recent quarter, and the non-GAAP metric of core return on
tangible common equity measured 12.2%.
Compared to the prior quarter, total net revenue from continuing
operations increased by $2 million,
or 2%, and the non-GAAP measure of core revenue increased by
$4 million, or 4%. The net
interest margin was 3.19% in the most recent quarter, increasing by
0.02% from the prior quarter, including the benefit of higher
accretion related to the SIFI acquisition. Fee income
was down 3% from the prior quarter due to lower loan related
revenue. Non-interest income decreased due to higher tax
credit amortization charges which were more than offset by the
benefit to income tax expense from tax credits received on projects
completed during the quarter.
Non-interest expense increased quarter-over-quarter including
the acquired SIFI operations and higher merger related
charges. Compared to the prior quarter, non- interest expense
increased by $5 million, or 6%, while
the non-GAAP measure of core expense increased by $400 thousand, or 1%. The efficiency ratio
improved to 56% from 60%. Excluding SIFI and the FCLS
operations, full time equivalent staff decreased to 1,391 at
midyear, compared to 1,485 at the start of the year. FCLS
staff totaled 416 at midyear, compared to 432 at the start of the
year. Staff in the acquired SIFI operations totaled 230 at
midyear. The effective income tax rate decreased to 18% in
the most recent quarter from 22% in the prior quarter due to higher
tax credit benefits resulting from tax credit investment projects
that came into service during the quarter. Net of the related
amortization charges to non-interest income previously mentioned,
these projects contributed $0.01 to
earnings per share during the quarter.
The FCLS national mortgage banking operations contributed
$0.03 in non-core EPS during the most
recent quarter, as industry business volumes improved following the
decrease in long term interest rates that developed during the
quarter. These operations generated $15 million in fee revenue, which was an increase
of 56% quarter-over-quarter and 47% year-over-year due to improved
market conditions. The Company generated $719 million in held-for-sale residential
mortgages in the most recent quarter, compared to $398 million in the prior quarter and to
$626 million in the second quarter of
2018. Due to the decision to sell the FCLS operations, they
are accounted for as discontinued in the financial statements, and
most references to revenue and expense refer to continuing
operations and exclude FCLS revenue and expense.
INVESTOR CONFERENCE CALL AND INVESTOR PRESENTATION
Berkshire will conduct a
conference call/webcast at 10:00 a.m.
eastern time on Wednesday, July 24, 2019 to discuss the
results for the quarter and provide guidance about expected future
results. Prior to the call, the Company will post a
presentation at its website with updates on its strategic
initiatives. Participants are encouraged to
pre-register for the conference call using the following
link: http://dpregister.com/10133134. Callers who
pre-register will be given dial-in instructions and a unique PIN to
gain immediate access to the call. Participants may
pre-register at any time prior to the call, and will immediately
receive simple instructions via email. Additionally,
participants may reach the registration link and access the webcast
by logging in through the investor section of Berkshire's website at
http://ir.berkshirebank.com. Those parties who do not have
internet access or are otherwise unable to pre-register for this
event, may still participate at the above time by dialing
1-844-792-3726 and asking the Operator to join the Berkshire Hills
Bancorp (BHLB) earnings call. A telephone replay of the call
will be available through Wednesday, July
31, 2019 by dialing 877-344-7529 and entering access number
10133134. The webcast will be available on Berkshire's website for an extended period of
time.
BACKGROUND
Berkshire Hills Bancorp is the parent of Berkshire Bank, a
premier regional bank distinguished by its local responsiveness and
engagement. With corporate headquarters in Boston, the Company operates in seven
Northeastern states, with approximately $13.7 billion in assets and 132 banking
offices. Berkshire Bank is recognized for its entrepreneurial
approach, relationship customer experience, and distinctive culture
embracing and celebrating the diversity of all customers, employees
and, suppliers.
FORWARD LOOKING STATEMENTS
This document contains forward-looking statements as defined in
the Private Securities Litigation Reform Act of 1995. There are
several factors that could cause actual results to differ
significantly from expectations described in the forward-looking
statements. For a discussion of such factors, please see
Berkshire's most recent reports on
Forms 10-K and 10-Q filed with the Securities and Exchange
Commission and available on the SEC's website at www.sec.gov.
Berkshire does not undertake any
obligation to update forward-looking statements.
NON-GAAP FINANCIAL MEASURES
This document contains certain non-GAAP financial measures in
addition to results presented in accordance with Generally Accepted
Accounting Principles ("GAAP"). These non-GAAP measures
provide supplemental perspectives on operating results, performance
trends, and financial condition. They are not a substitute
for GAAP measures; they should be read and used in conjunction with
the Company's GAAP financial information. A reconciliation of
non-GAAP financial measures to GAAP measures is included on pages
F-9 and F-10 in the accompanying financial tables. In all
cases, it should be understood that non-GAAP per share measures do
not depict amounts that accrue directly to the benefit of
shareholders.
The Company utilizes the non-GAAP measure of core earnings in
evaluating operating trends, including components for core revenue
and expense. These measures exclude items which the Company
does not view as related to its normalized operations. These
items primarily include securities gains/losses, merger costs,
restructuring costs, and discontinued operations. Merger
costs consist primarily of severance/benefit related expenses,
contract termination costs, systems conversion costs, variable
compensation expenses, and professional fees. Merger costs in
2018 and 2019 are primarily related to the acquisitions of Commerce
Bancshares Corp. and SI Financial Group. Restructuring costs
generally consist of costs and losses associated with the
disposition of assets and liabilities and lease terminations,
including costs related to branch sales. Restructuring costs
also include severance and consulting expenses related to the
Company's strategic review. Discontinued operations are
the Company's national mortgage banking operations for which the
Company is pursuing sale opportunities. In 2018, the Company
recorded $8 million in charges
related to the restructuring of banking systems vendor
relationships. The Company recorded a $3 million cost for the settlement of an existing
legal proceeding with a plaintiff claiming to be representing a
class of depositors. Non-core charges in 2018 also included a
$1.5 million net charge related to
the CEO transition.
Non-core adjustments are presented net of an adjustment for
income tax expense. This adjustment is determined as the
difference between the GAAP tax rate and the effective tax rate
applicable to core income. The efficiency ratio is adjusted
for non-core revenue and expense items and for tax preference
items. The Company also calculates measures related to
tangible equity, which adjust equity (and assets where applicable)
to exclude intangible assets due to the importance of these
measures to the investment community.
CONTACTS
Investor Relations Contact
Erin E. Duggan; Investor
Relations Manager; 413-236-3773
Media Contact
Cassandra Giovanni; Corporate
Communications Manager; 860-428-9561
TABLE
INDEX
|
CONSOLIDATED
UNAUDITED FINANCIAL SCHEDULES
|
F-1
|
Selected Financial
Highlights
|
F-2
|
Balance
Sheets
|
F-3
|
Loan and Deposit
Analysis
|
F-4
|
Statements of
Income
|
F-5
|
Statements of
Operations (Five Quarter Trend)
|
F-6
|
Average Yields and
Costs
|
F-7
|
Average
Balances
|
F-8
|
Asset Quality
Analysis
|
F-9
|
Reconciliation of
Non-GAAP Financial Measures
|
|
and Supplementary
Data (Five Quarter Trend)
|
F-10
|
Reconciliation of
Non-GAAP Financial Measures
|
|
and Supplementary
Data (Year-to-Date)
|
BERKSHIRE HILLS
BANCORP, INC.
|
SELECTED FINANCIAL
HIGHLIGHTS - UNAUDITED - (F-1)
|
|
|
|
|
At or for the
Quarters Ended (1)
|
|
|
|
|
June 30,
|
|
March 31,
|
|
Dec. 31,
|
|
Sept. 30,
|
|
June 30,
|
|
|
|
|
|
2019 (2)
|
|
2019
|
|
2018
|
|
2018
|
|
2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
PER SHARE
DATA
|
|
|
|
|
|
|
|
|
|
|
|
|
Net earnings per
common share, diluted
|
$
0.52
|
|
$
0.51
|
|
$
0.31
|
|
$
0.70
|
|
$
0.74
|
|
|
|
Core earnings per
common share, diluted (3)
|
0.65
|
|
0.60
|
|
0.69
|
|
0.72
|
|
0.73
|
|
|
|
Total book value per
common share
|
34.05
|
|
33.75
|
|
33.30
|
|
32.84
|
|
32.49
|
|
|
|
Tangible book value
per common share (3)
|
22.25
|
|
21.66
|
|
21.15
|
|
20.68
|
|
20.28
|
|
|
|
Market price at
period end
|
31.39
|
|
27.24
|
|
26.97
|
|
40.70
|
|
40.60
|
|
|
|
Dividends per common
share
|
0.23
|
|
0.23
|
|
0.22
|
|
0.22
|
|
0.22
|
|
|
|
Dividends per
preferred share
|
0.46
|
|
0.46
|
|
0.44
|
|
0.44
|
|
0.44
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
PERFORMANCE RATIOS
(4)
|
|
|
|
|
|
|
|
|
|
|
|
|
Return on
assets
|
0.79
|
%
|
0.78
|
%
|
0.47
|
%
|
1.08
|
%
|
1.17
|
%
|
|
|
Core return on assets
(3)
|
1.01
|
|
0.92
|
|
1.07
|
|
1.12
|
|
1.18
|
|
|
|
Return on
equity
|
6.07
|
|
5.97
|
|
3.61
|
|
8.27
|
|
8.88
|
|
|
|
Core return on equity
(3)
|
7.67
|
|
7.00
|
|
8.09
|
|
8.49
|
|
8.81
|
|
|
|
Core return on
tangible common equity (3)
|
12.21
|
|
11.44
|
|
13.21
|
|
14.02
|
|
14.68
|
|
|
|
Net interest margin,
fully taxable equivalent (FTE) (5)(6)
|
3.19
|
|
3.17
|
|
3.41
|
|
3.32
|
|
3.50
|
|
|
|
Fee income/Net
interest and fee income from continuing operations
|
16.20
|
|
17.56
|
|
15.59
|
|
18.06
|
|
17.21
|
|
|
|
Efficiency ratio
(3)
|
56.41
|
|
59.54
|
|
54.88
|
|
52.20
|
|
52.42
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GROWTH
(Year-to-date)
|
|
|
|
|
|
|
|
|
|
|
|
|
Total commercial
loans (organic, annualized)
|
(10)
|
%
|
(3)
|
%
|
6
|
%
|
5
|
%
|
5
|
%
|
|
|
Total loans (organic,
annualized)
|
(9)
|
|
(4)
|
|
9
|
|
10
|
|
10
|
|
|
|
Total deposits
(organic, annualized)
|
6
|
|
8
|
|
3
|
|
0
|
|
2
|
|
|
|
Total net revenues
from continuing operations (compared to prior year)
|
1
|
|
3
|
|
17
|
|
22
|
|
21
|
|
|
|
Earnings per common
share (compared to prior year)
|
(20)
|
|
(7)
|
|
65
|
|
28
|
|
33
|
|
|
|
Core earnings per
common share (compared to prior year)(3)
|
(9)
|
|
(8)
|
|
32
|
|
37
|
|
36
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FINANCIAL DATA
(in millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
assets
|
|
$
13,653
|
|
$
12,173
|
|
$
12,212
|
|
$
12,030
|
|
$
11,902
|
|
|
|
Total earning
assets
|
12,343
|
|
11,039
|
|
11,140
|
|
10,957
|
|
10,827
|
|
|
|
Total
securities
|
1,905
|
|
1,881
|
|
1,919
|
|
1,918
|
|
1,920
|
|
|
|
Total
loans
|
|
9,942
|
|
8,947
|
|
9,043
|
|
8,905
|
|
8,710
|
|
|
|
Allowance for loan
losses
|
62
|
|
62
|
|
61
|
|
58
|
|
56
|
|
|
|
Total intangible
assets
|
603
|
|
551
|
|
552
|
|
553
|
|
555
|
|
|
|
Total
deposits
|
|
10,566
|
|
9,166
|
|
8,982
|
|
8,766
|
|
8,839
|
|
|
|
Total shareholders'
equity
|
1,779
|
|
1,577
|
|
1,553
|
|
1,532
|
|
1,516
|
|
|
|
Net income
|
|
25.4
|
|
23.6
|
|
14.3
|
|
32.2
|
|
34.0
|
|
|
|
Core income
(3)
|
32.1
|
|
27.7
|
|
32.0
|
|
33.1
|
|
33.8
|
|
|
|
Purchase accounting
accretion
|
3.2
|
|
1.3
|
|
8.2
|
|
4.6
|
|
7.3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ASSET QUALITY AND
CONDITION RATIOS
|
|
|
|
|
|
|
|
|
|
|
|
|
Net charge-offs
(current quarter annualized)/average loans
|
0.14
|
%
|
0.15
|
%
|
0.17
|
%
|
0.19
|
%
|
0.21
|
%
|
|
|
Total non-performing
assets/total assets
|
0.27
|
|
0.26
|
|
0.28
|
|
0.30
|
|
0.20
|
|
|
|
Allowance for loan
losses/total loans
|
0.63
|
|
0.69
|
|
0.68
|
|
0.66
|
|
0.64
|
|
|
|
Loans/deposits
|
94
|
|
98
|
|
101
|
|
102
|
|
99
|
|
|
|
Shareholders' equity
to total assets
|
13.03
|
|
12.95
|
|
12.72
|
|
12.74
|
|
12.74
|
|
|
|
Tangible
shareholders' equity to tangible assets (3)
|
9.01
|
|
8.83
|
|
8.59
|
|
8.53
|
|
8.47
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Reconciliations of
non-GAAP financial measures, including all references to core and
tangible amounts, appear on pages F-9 and F-10.
|
|
(2)
|
The Company acquired
SI Financial Group, Inc. on May 17, 2019.
|
|
|
|
|
|
|
|
|
|
|
|
(3)
|
Non-GAAP financial
measure. Core measurements are non-GAAP financial measures that are
adjusted to exclude net non-core charges
primarily
|
|
|
|
related to
acquisitions and restructuring activities. See pages F-9 and F-10
for reconciliations of non-GAAP financial measures.
|
|
(4)
|
All performance
ratios are annualized and are based on average balance sheet
amounts, where applicable.
|
|
|
|
|
(5)
|
Fully taxable
equivalent considers the impact of tax advantaged investment
securities and loans.
|
|
|
(6)
|
The effect of
purchase accounting accretion for loans, time deposits, and
borrowings on the quarterly net interest margin was an increase in
all quarters,
|
|
|
|
which is shown
sequentially as follows beginning with the most recent quarter and
ending with the earliest quarter: 0.11%, 0.05%, 0.30%, 0.17%,
0.27%.
|
|
BERKSHIRE HILLS
BANCORP, INC.
|
CONSOLIDATED
BALANCE SHEETS - UNAUDITED - (F-2)
|
|
June 30,
|
|
March 31,
|
|
December
31,
|
|
(in
thousands)
|
2019
|
|
2019
|
|
2018
|
|
Assets
|
|
|
|
|
|
|
Cash and due from
banks
|
$
100,588
|
|
$
98,689
|
|
$
100,972
|
|
Short-term
investments
|
128,718
|
|
68,930
|
|
82,217
|
|
Total cash and
short-term investments
|
229,306
|
|
167,619
|
|
183,189
|
|
|
|
|
|
|
|
|
Trading
security
|
11,210
|
|
11,164
|
|
11,212
|
|
Marketable equity
securities, at fair value
|
59,121
|
|
59,121
|
|
56,638
|
|
Securities available
for sale, at fair value
|
1,410,535
|
|
1,386,768
|
|
1,399,647
|
|
Securities held to
maturity, at amortized cost
|
364,463
|
|
369,331
|
|
373,763
|
|
Federal Home Loan
Bank stock and other restricted securities
|
59,356
|
|
54,624
|
|
77,344
|
|
Total
securities
|
1,904,685
|
|
1,881,008
|
|
1,918,604
|
|
|
|
|
|
|
|
|
Loans held for
sale
|
184,810
|
|
4,773
|
|
2,183
|
|
|
|
|
|
|
|
|
Commercial real
estate loans
|
4,005,347
|
|
3,388,139
|
|
3,400,221
|
|
Commercial and
industrial loans
|
1,987,297
|
|
1,957,339
|
|
1,980,046
|
|
Residential
mortgages
|
2,882,380
|
|
2,544,824
|
|
2,566,424
|
|
Consumer
loans
|
1,066,804
|
|
1,057,193
|
|
1,096,562
|
|
Total
loans
|
9,941,828
|
|
8,947,495
|
|
9,043,253
|
|
Less: Allowance for
loan losses
|
(62,156)
|
|
(62,038)
|
|
(61,469)
|
|
Net loans
|
9,879,672
|
|
8,885,457
|
|
8,981,784
|
|
|
|
|
|
|
|
|
Premises and
equipment, net
|
121,619
|
|
105,651
|
|
106,500
|
|
Other real estate
owned
|
154
|
|
-
|
|
-
|
|
Goodwill
|
553,796
|
|
518,325
|
|
518,325
|
|
Other intangible
assets
|
48,724
|
|
32,219
|
|
33,418
|
|
Cash surrender value
of bank-owned life insurance
|
227,458
|
|
191,768
|
|
190,609
|
|
Deferred tax asset,
net
|
51,118
|
|
38,783
|
|
42,434
|
|
Other
assets
|
238,951
|
|
182,720
|
|
120,926
|
|
Assets from
discontinued operations
|
212,745
|
|
165,078
|
|
114,259
|
|
Total
assets
|
$
13,653,038
|
|
$
12,173,401
|
|
$
12,212,231
|
|
|
|
|
|
|
|
|
Liabilities and
shareholders' equity
|
|
|
|
|
|
|
Demand
deposits
|
$
1,827,016
|
|
$
1,526,584
|
|
$
1,603,019
|
|
NOW and other
deposits
|
997,685
|
|
820,177
|
|
1,122,321
|
|
Money market
deposits
|
2,811,158
|
|
2,743,448
|
|
2,245,195
|
|
Savings
deposits
|
848,699
|
|
731,711
|
|
724,129
|
|
Time
deposits
|
4,081,398
|
|
3,344,495
|
|
3,287,717
|
|
Total
deposits
|
10,565,956
|
|
9,166,415
|
|
8,982,381
|
|
|
|
|
|
|
|
|
Senior
borrowings
|
904,814
|
|
1,120,189
|
|
1,428,298
|
|
Subordinated
borrowings
|
96,927
|
|
89,562
|
|
89,518
|
|
Total
borrowings
|
1,001,741
|
|
1,209,751
|
|
1,517,816
|
|
|
|
|
|
|
|
|
Other
liabilities
|
280,155
|
|
204,725
|
|
149,519
|
|
Liabilities from
discontinued operations
|
26,256
|
|
15,505
|
|
9,597
|
|
Total
liabilities
|
11,874,108
|
|
10,596,396
|
|
10,659,313
|
|
|
|
|
|
|
|
|
Preferred
shareholders' equity
|
40,633
|
|
40,633
|
|
40,633
|
|
Common shareholders'
equity
|
1,738,297
|
|
1,536,372
|
|
1,512,285
|
|
Total shareholders'
equity
|
1,778,930
|
|
1,577,005
|
|
1,552,918
|
|
Total liabilities and
shareholders' equity
|
$
13,653,038
|
|
$
12,173,401
|
|
$
12,212,231
|
|
|
|
|
|
|
|
|
Net common shares
outstanding
|
51,045
|
|
45,522
|
|
45,417
|
|
BERKSHIRE HILLS
BANCORP, INC.
|
|
CONSOLIDATED LOAN
& DEPOSIT ANALYSIS - UNAUDITED - (F-3)
|
|
LOAN
ANALYSIS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Organic Annualized
Growth %(1)
|
|
(in
millions)
|
|
June 30, 2019
Balance
|
|
Acquired Savings
Institute Balances (2)
|
|
March 31, 2019
Balance
|
|
December 31, 2018
Balance
|
|
Quarter ended
June 30, 2019
|
|
Year to
Date
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total commercial real
estate
|
|
$
4,006
|
|
$
624
|
|
$
3,388
|
|
$
3,400
|
|
(1)
|
%
|
(1)
|
%
|
|
Commercial and
industrial loans
|
|
1,987
|
|
244
|
|
1,957
|
|
1,980
|
|
(44)
|
|
(24)
|
|
|
Total commercial
loans
|
|
5,993
|
|
868
|
|
5,345
|
|
5,380
|
|
(17)
|
|
(10)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total residential
mortgages
|
|
2,882
|
|
375
|
|
2,545
|
|
2,566
|
|
(6)
|
|
(5)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Home
equity
|
|
404
|
|
58
|
|
365
|
|
377
|
|
(21)
|
|
(16)
|
|
|
Auto and
other
|
|
663
|
|
2
|
|
692
|
|
720
|
|
(18)
|
|
(16)
|
|
|
Total consumer
loans
|
|
1,067
|
|
60
|
|
1,057
|
|
1,097
|
|
(19)
|
|
(16)
|
|
|
Total
loans
|
|
$
9,942
|
|
$
1,303
|
|
$
8,947
|
|
$
9,043
|
|
(14)
|
%
|
(9)
|
%
|
|
(1) Non-GAAP
financial measure.
|
|
|
|
|
|
|
|
|
|
|
|
|
(2) The acquired
balances for Savings Institute are as of May 17, 2019.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
DEPOSIT
ANALYSIS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Organic Annualized
Growth % (1)
|
|
(in
millions)
|
|
June 30, 2019
Balance
|
|
Acquired Savings
Institute Balances (2)
|
|
March 31, 2019
Balance
|
|
December 31, 2018
Balance
|
|
Quarter ended
June 30, 2019
|
|
Year to
Date
|
|
|
Demand
|
|
$
1,827
|
|
$
258
|
|
$
1,527
|
|
$
1,603
|
|
11
|
%
|
(4)
|
%
|
|
NOW and
other
|
|
998
|
|
138
|
|
820
|
|
1,122
|
|
20
|
|
(47)
|
|
|
Money
market
|
|
2,811
|
|
190
|
|
2,743
|
|
2,245
|
|
(18)
|
|
34
|
|
|
Savings
|
|
849
|
|
164
|
|
732
|
|
724
|
|
(26)
|
|
(11)
|
|
|
Time
deposits
|
|
4,081
|
|
585
|
|
3,344
|
|
3,288
|
|
18
|
|
13
|
|
|
Total
deposits
|
|
$
10,566
|
|
$
1,335
|
|
$
9,166
|
|
$
8,982
|
|
3
|
%
|
6
|
%
|
|
(1) Non-GAAP
financial measure.
|
|
|
|
|
|
|
|
|
|
|
|
|
(2) The acquired
balances for Savings Institute are as of May 17, 2019.
|
|
|
|
|
|
|
|
|
|
BERKSHIRE HILLS
BANCORP, INC.
|
CONSOLIDATED
STATEMENTS OF INCOME - UNAUDITED - (F-4)
|
|
Three Months
Ended
|
|
Six Months
Ended
|
|
June 30,
|
|
June 30,
|
(in thousands,
except per share data)
|
2019
|
|
2018
|
|
2019
|
|
2018
|
Interest and
dividend income from continuing
operations
|
|
|
|
|
|
|
|
Loans
|
$
113,990
|
|
$
100,254
|
|
$
219,641
|
|
$
191,995
|
Securities and
other
|
15,248
|
|
15,230
|
|
30,706
|
|
29,635
|
Total interest and
dividend income
|
129,238
|
|
115,484
|
|
250,347
|
|
221,630
|
Interest expense
from continuing operations
|
|
|
|
|
|
|
|
Deposits
|
28,273
|
|
17,768
|
|
54,895
|
|
33,093
|
Borrowings
|
9,370
|
|
7,424
|
|
18,398
|
|
13,488
|
Total interest
expense
|
37,643
|
|
25,192
|
|
73,293
|
|
46,581
|
Net interest
income from continuing operations
|
91,595
|
|
90,292
|
|
177,054
|
|
175,049
|
Non-interest
income from continuing operations
|
|
|
|
|
|
|
|
Mortgage banking
originations
|
278
|
|
334
|
|
324
|
|
472
|
Loan related
income
|
4,822
|
|
6,003
|
|
10,825
|
|
10,822
|
Deposit related
fees
|
7,525
|
|
7,605
|
|
14,383
|
|
15,671
|
Insurance commissions
and fees
|
2,738
|
|
2,549
|
|
5,591
|
|
5,574
|
Wealth management
fees
|
2,348
|
|
2,280
|
|
4,789
|
|
4,877
|
Total fee
income
|
17,711
|
|
18,771
|
|
35,912
|
|
37,416
|
Other
|
(216)
|
|
155
|
|
754
|
|
1,423
|
Securities
gains/(losses), net
|
17
|
|
718
|
|
2,568
|
|
(784)
|
(Loss)/gain on sale
of business operations and assets, net
|
-
|
|
(21)
|
|
-
|
|
460
|
Total non-interest
income
|
17,512
|
|
19,623
|
|
39,234
|
|
38,515
|
Total net revenue
from continuing operations
|
109,107
|
|
109,915
|
|
216,288
|
|
213,564
|
Provision for loan
losses
|
3,467
|
|
6,532
|
|
7,468
|
|
12,107
|
Non-interest
expense from continuing operations
|
|
|
|
|
|
|
|
Compensation and
benefits
|
34,779
|
|
33,499
|
|
68,279
|
|
67,346
|
Occupancy and
equipment
|
9,449
|
|
9,224
|
|
18,895
|
|
18,416
|
Technology and
communications
|
6,715
|
|
7,053
|
|
12,972
|
|
13,537
|
Marketing and
promotion
|
1,155
|
|
1,084
|
|
2,422
|
|
2,306
|
Professional
services
|
3,953
|
|
864
|
|
6,228
|
|
2,560
|
FDIC premiums and
assessments
|
1,751
|
|
1,411
|
|
3,390
|
|
2,606
|
Other real estate
owned and foreclosures
|
(2)
|
|
1
|
|
-
|
|
68
|
Amortization of
intangible assets
|
1,475
|
|
1,246
|
|
2,675
|
|
2,514
|
Merger, restructuring
and other expense
|
11,155
|
|
847
|
|
18,170
|
|
5,940
|
Other
|
6,138
|
|
6,298
|
|
15,528
|
|
11,600
|
Total non-interest
expense
|
76,568
|
|
61,527
|
|
148,559
|
|
126,893
|
|
|
|
|
|
|
|
|
Income from
continuing operations before income
taxes
|
$
29,072
|
|
$
41,856
|
|
$
60,261
|
|
$
74,564
|
Income tax
expense
|
5,118
|
|
8,145
|
|
12,035
|
|
15,482
|
Net income from
continuing operations
|
$
23,954
|
|
$
33,711
|
|
$
48,226
|
|
$
59,082
|
|
|
|
|
|
|
|
|
Income from
discontinued operations before income taxes
|
$
2,082
|
|
$
426
|
|
$
1,228
|
|
$
264
|
Income tax
expense
|
588
|
|
106
|
|
371
|
|
67
|
Net income from
discontinued operations
|
$
1,494
|
|
$
320
|
|
$
857
|
|
$
197
|
|
|
|
|
|
|
|
|
Net
income
|
$
25,448
|
|
$
34,031
|
|
$
49,083
|
|
$
59,279
|
Preferred stock
dividend
|
240
|
|
229
|
|
480
|
|
459
|
Income available
to common shareholders
|
$
25,208
|
|
$
33,802
|
|
$
48,603
|
|
$
58,820
|
|
|
|
|
|
|
|
|
Basic earnings per
common share:
|
|
|
|
|
|
|
|
Continuing
Operations
|
$
0.49
|
|
$
0.73
|
|
$
1.01
|
|
$
1.29
|
Discontinued
Operations
|
0.03
|
|
0.01
|
|
0.02
|
|
-
|
Total
|
$
0.52
|
|
$
0.74
|
|
$
1.03
|
|
$
1.29
|
|
|
|
|
|
|
|
|
Diluted earnings
per common share:
|
|
|
|
|
|
|
|
Continuing
Operations
|
$
0.49
|
|
$
0.73
|
|
$
1.01
|
|
$
1.28
|
Discontinued
Operations
|
0.03
|
|
0.01
|
|
0.02
|
|
-
|
Total
|
$
0.52
|
|
$
0.74
|
|
$
1.03
|
|
$
1.28
|
|
|
|
|
|
|
|
|
Weighted average
shares
outstanding:
|
|
|
|
|
|
|
|
Basic
|
48,961
|
|
46,032
|
|
47,550
|
|
45,999
|
Diluted
|
49,114
|
|
46,215
|
|
47,700
|
|
46,206
|
|
|
|
|
|
|
|
|
BERKSHIRE HILLS
BANCORP, INC.
|
CONSOLIDATED
STATEMENTS OF OPERATIONS (5 Quarter Trend) - UNAUDITED -
(F-5)
|
|
|
|
June 30,
|
|
March 31,
|
|
Dec. 31,
|
|
Sept. 30,
|
|
June 30,
|
|
(in thousands,
except per share data)
|
2019
|
|
2019
|
|
2018
|
|
2018
|
|
2018
|
|
Interest and
dividend income from continuing
operations
|
|
|
|
|
|
|
|
|
|
|
Loans
|
$
113,990
|
|
$
105,651
|
|
$
111,576
|
|
$
102,651
|
|
$
100,254
|
|
Securities and
other
|
15,248
|
|
15,458
|
|
15,119
|
|
14,918
|
|
15,230
|
|
Total interest and
dividend income
|
129,238
|
|
121,109
|
|
126,695
|
|
117,569
|
|
115,484
|
|
Interest expense
from continuing operations
|
|
|
|
|
|
|
|
|
|
|
Deposits
|
28,273
|
|
26,622
|
|
23,811
|
|
21,460
|
|
17,768
|
|
Borrowings
|
9,370
|
|
9,028
|
|
10,118
|
|
7,724
|
|
7,424
|
|
Total interest
expense
|
37,643
|
|
35,650
|
|
33,929
|
|
29,184
|
|
25,192
|
|
Net interest
income from continuing operations
|
91,595
|
|
85,459
|
|
92,766
|
|
88,385
|
|
90,292
|
|
Non-interest
income from continuing operations
|
|
|
|
|
|
|
|
|
|
|
Mortgage banking
originations
|
278
|
|
46
|
|
148
|
|
15
|
|
334
|
|
Loan related
income
|
4,822
|
|
6,003
|
|
5,087
|
|
7,246
|
|
6,003
|
|
Deposit related
fees
|
7,525
|
|
6,858
|
|
7,131
|
|
7,004
|
|
7,605
|
|
Insurance commissions
and fees
|
2,738
|
|
2,853
|
|
2,479
|
|
2,930
|
|
2,549
|
|
Wealth management
fees
|
2,348
|
|
2,441
|
|
2,287
|
|
2,283
|
|
2,280
|
|
Total fee
income
|
17,711
|
|
18,201
|
|
17,132
|
|
19,478
|
|
18,771
|
|
Other
|
(216)
|
|
970
|
|
1,666
|
|
468
|
|
155
|
|
Securities
gains/(losses), net
|
17
|
|
2,551
|
|
(3,023)
|
|
88
|
|
718
|
|
(Loss) on sale of
business operations and assets, net
|
-
|
|
-
|
|
-
|
|
-
|
|
(21)
|
|
Total non-interest
income
|
17,512
|
|
21,722
|
|
15,775
|
|
20,034
|
|
19,623
|
|
Total net revenue
from continuing operations
|
109,107
|
|
107,181
|
|
108,541
|
|
108,419
|
|
109,915
|
|
Provision for loan
losses
|
3,467
|
|
4,001
|
|
6,716
|
|
6,628
|
|
6,532
|
|
Non-interest
expense from continuing operations
|
|
|
|
|
|
|
|
|
|
|
Compensation and
benefits
|
34,779
|
|
33,500
|
|
34,927
|
|
31,746
|
|
33,499
|
|
Occupancy and
equipment
|
9,449
|
|
9,446
|
|
9,366
|
|
9,145
|
|
9,224
|
|
Technology and
communications
|
6,715
|
|
6,257
|
|
6,103
|
|
7,507
|
|
7,053
|
|
Marketing and
promotion
|
1,155
|
|
1,267
|
|
1,224
|
|
1,167
|
|
1,084
|
|
Professional
services
|
3,953
|
|
2,275
|
|
3,302
|
|
1,481
|
|
864
|
|
FDIC premiums and
assessments
|
1,751
|
|
1,639
|
|
1,488
|
|
1,640
|
|
1,411
|
|
Other real estate
owned and foreclosures
|
(2)
|
|
2
|
|
1
|
|
(1)
|
|
1
|
|
Amortization of
intangible assets
|
1,475
|
|
1,200
|
|
1,202
|
|
1,218
|
|
1,246
|
|
Merger, restructuring
and other expense
|
11,155
|
|
7,015
|
|
16,006
|
|
198
|
|
847
|
|
Other
|
6,138
|
|
9,390
|
|
6,754
|
|
5,526
|
|
6,298
|
|
Total non-interest
expense
|
76,568
|
|
71,991
|
|
80,373
|
|
59,627
|
|
61,527
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from
continuing operations before income taxes
|
$
29,072
|
|
$
31,189
|
|
$
21,452
|
|
$
42,164
|
|
$
41,856
|
|
Income tax
expense
|
5,118
|
|
6,917
|
|
4,384
|
|
9,095
|
|
8,145
|
|
Net income from
continuing operations
|
$
23,954
|
|
$
24,272
|
|
$
17,068
|
|
$
33,069
|
|
$
33,711
|
|
|
|
|
|
|
|
|
|
|
|
|
Income/(loss) from
discontinued operations before income taxes
|
$
2,082
|
|
$
(854)
|
|
$
(3,884)
|
|
$
(1,147)
|
|
$
426
|
|
Income tax
expense/(benefit)
|
588
|
|
(217)
|
|
(1,075)
|
|
(305)
|
|
106
|
|
Net income/(loss)
from discontinued operations
|
$
1,494
|
|
$
(637)
|
|
$
(2,809)
|
|
$
(842)
|
|
$
320
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
income
|
$
25,448
|
|
$
23,635
|
|
$
14,259
|
|
$
32,227
|
|
$
34,031
|
|
Preferred stock
dividend
|
240
|
|
240
|
|
229
|
|
230
|
|
229
|
|
Income available
to common shareholders
|
$
25,208
|
|
$
23,395
|
|
$
14,030
|
|
$
31,997
|
|
$
33,802
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings per
common share:
|
|
|
|
|
|
|
|
|
|
|
Continuing
Operations
|
$
0.49
|
|
$
0.52
|
|
$
0.37
|
|
$
0.72
|
|
$
0.73
|
|
Discontinued
Operations
|
0.03
|
|
(0.01)
|
|
(0.06)
|
|
(0.02)
|
|
0.01
|
|
Total
|
$
0.52
|
|
$
0.51
|
|
$
0.31
|
|
$
0.70
|
|
$
0.74
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings
per common share:
|
|
|
|
|
|
|
|
|
|
|
Continuing
Operations
|
$
0.49
|
|
$
0.52
|
|
$
0.37
|
|
$
0.72
|
|
$
0.73
|
|
Discontinued
Operations
|
0.03
|
|
(0.01)
|
|
(0.06)
|
|
(0.02)
|
|
0.01
|
|
Total
|
$
0.52
|
|
$
0.51
|
|
$
0.31
|
|
$
0.70
|
|
$
0.74
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
shares
outstanding:
|
|
|
|
|
|
|
|
|
|
|
Basic
|
48,961
|
|
46,113
|
|
46,061
|
|
46,030
|
|
46,032
|
|
Diluted
|
49,114
|
|
46,261
|
|
46,240
|
|
46,263
|
|
46,215
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BERKSHIRE HILLS
BANCORP, INC.
|
AVERAGE YIELDS AND
COSTS (Fully Taxable Equivalent - Annualized) - UNAUDITED -
(F-6)
|
|
|
Quarters
Ended
|
|
|
June 30,
|
|
March 31,
|
|
Dec. 31,
|
|
Sept. 30,
|
|
June 30,
|
|
|
|
2019
|
|
2019
|
|
2018
|
|
2018
|
|
2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earning
assets
|
|
|
|
|
|
|
|
|
|
|
|
Loans:
|
|
|
|
|
|
|
|
|
|
|
|
Commercial real
estate
|
|
5.01
|
%
|
4.91
|
%
|
5.40
|
%
|
4.67
|
%
|
5.08
|
%
|
Commercial and
industrial loans
|
|
5.79
|
|
5.83
|
|
5.97
|
|
6.22
|
|
5.73
|
|
Residential
mortgages
|
|
3.74
|
|
3.74
|
|
3.72
|
|
3.66
|
|
3.72
|
|
Consumer
loans
|
|
4.52
|
|
4.45
|
|
4.52
|
|
4.27
|
|
4.13
|
|
Total
loans
|
|
4.76
|
|
4.73
|
|
4.94
|
|
4.66
|
|
4.73
|
|
Securities
|
|
3.38
|
|
3.46
|
|
3.34
|
|
3.32
|
|
3.45
|
|
Short-term
investments and loans held for sale
|
|
3.37
|
|
3.59
|
|
3.74
|
|
3.82
|
|
3.86
|
|
Total earning
assets
|
|
4.51
|
|
4.49
|
|
4.64
|
|
4.41
|
|
4.48
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Funding
liabilities
|
|
|
|
|
|
|
|
|
|
|
|
Deposits:
|
|
|
|
|
|
|
|
|
|
|
|
NOW and
other
|
|
0.66
|
|
0.65
|
|
0.59
|
|
0.58
|
|
0.44
|
|
Money
market
|
|
1.27
|
|
1.23
|
|
1.10
|
|
0.92
|
|
0.88
|
|
Savings
|
|
0.15
|
|
0.18
|
|
0.16
|
|
0.15
|
|
0.14
|
|
Time
|
|
2.06
|
|
2.07
|
|
1.93
|
|
1.76
|
|
1.54
|
|
Total
interest-bearing deposits
|
|
1.44
|
|
1.44
|
|
1.31
|
|
1.18
|
|
1.02
|
|
Borrowings
|
|
2.92
|
|
2.85
|
|
2.67
|
|
2.42
|
|
2.29
|
|
Total
interest-bearing liabilities
|
|
1.66
|
|
1.65
|
|
1.55
|
|
1.38
|
|
1.23
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest
spread
|
|
2.85
|
|
2.84
|
|
3.09
|
|
3.03
|
|
3.25
|
|
Net interest
margin
|
|
3.19
|
|
3.17
|
|
3.41
|
|
3.32
|
|
3.50
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of funds
(1)
|
|
1.41
|
|
1.41
|
|
1.31
|
|
1.16
|
|
1.03
|
|
Cost of
deposits
|
|
1.18
|
|
1.19
|
|
1.07
|
|
0.96
|
|
0.83
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Cost of funds
includes all deposits and borrowings.
|
|
|
|
|
BERKSHIRE HILLS
BANCORP, INC.
|
AVERAGE BALANCES -
UNAUDITED - (F-7)
|
|
Quarters
Ended
|
|
June
30,
|
|
March
31,
|
|
Dec.
31,
|
|
Sept.
30,
|
|
June
30,
|
|
(in
thousands)
|
2019
|
|
2019
|
|
2018
|
|
2018
|
|
2018
|
|
Assets
|
|
|
|
|
|
|
|
|
|
|
Loans
|
|
|
|
|
|
|
|
|
|
|
Commercial real
estate
|
$
3,716,130
|
|
$
3,377,902
|
|
$
3,373,936
|
|
$
3,331,097
|
|
$
3,316,482
|
|
Commercial and
industrial loans
|
2,056,384
|
|
1,986,792
|
|
1,921,361
|
|
1,824,369
|
|
1,773,722
|
|
Residential
mortgages
|
2,711,348
|
|
2,556,299
|
|
2,539,592
|
|
2,459,943
|
|
2,268,886
|
|
Consumer
loans
|
1,064,579
|
|
1,079,583
|
|
1,112,433
|
|
1,120,942
|
|
1,113,089
|
|
Total loans
(1)
|
9,548,441
|
|
9,000,576
|
|
8,947,322
|
|
8,736,351
|
|
8,472,179
|
|
Securities
(2)
|
1,893,298
|
|
1,895,768
|
|
1,933,891
|
|
1,928,851
|
|
1,931,104
|
|
Short-term
investments and loans held for sale
|
117,029
|
|
67,367
|
|
51,827
|
|
47,752
|
|
36,136
|
|
Total earning assets
(3)
|
11,558,768
|
|
10,963,711
|
|
10,933,040
|
|
10,712,954
|
|
10,439,419
|
|
Goodwill and other
intangible assets
|
555,606
|
|
550,966
|
|
552,206
|
|
554,359
|
|
554,591
|
|
Other
assets
|
593,917
|
|
557,442
|
|
494,377
|
|
501,739
|
|
486,616
|
|
Assets from
discontinued operations
|
192,466
|
|
115,721
|
|
101,464
|
|
141,443
|
|
130,392
|
|
Total
assets
|
$
12,900,757
|
|
$
12,187,840
|
|
$
12,081,087
|
|
$
11,910,495
|
|
$
11,611,018
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities and
shareholders' equity
|
|
|
|
|
|
|
|
|
|
|
Deposits
|
|
|
|
|
|
|
|
|
|
|
NOW and
other
|
$
1,053,335
|
|
$
963,043
|
|
$
920,225
|
|
$
844,888
|
|
$
819,166
|
|
Money
market
|
2,474,071
|
|
2,378,496
|
|
2,339,699
|
|
2,348,516
|
|
2,524,713
|
|
Savings
|
780,797
|
|
736,707
|
|
728,853
|
|
740,765
|
|
749,995
|
|
Time
|
3,593,022
|
|
3,429,375
|
|
3,229,521
|
|
3,274,518
|
|
2,878,846
|
|
Total
interest-bearing deposits
|
7,901,225
|
|
7,507,621
|
|
7,218,298
|
|
7,208,687
|
|
6,972,720
|
|
Borrowings
|
1,415,614
|
|
1,351,834
|
|
1,566,478
|
|
1,363,914
|
|
1,382,794
|
|
Total
interest-bearing liabilities
|
9,316,839
|
|
8,859,455
|
|
8,784,776
|
|
8,572,601
|
|
8,355,514
|
|
Non-interest-bearing
demand deposits
|
1,673,560
|
|
1,538,767
|
|
1,579,013
|
|
1,635,564
|
|
1,619,470
|
|
Other
liabilities
|
215,704
|
|
192,119
|
|
127,370
|
|
132,521
|
|
89,933
|
|
Liabilities from
discontinued operations
|
18,434
|
|
13,962
|
|
8,854
|
|
11,880
|
|
12,650
|
|
Total
liabilities
|
11,224,537
|
|
10,604,303
|
|
10,500,013
|
|
10,352,566
|
|
10,077,567
|
|
|
|
|
|
|
|
|
|
|
|
|
Preferred
shareholders' equity
|
40,633
|
|
40,633
|
|
40,633
|
|
40,633
|
|
40,633
|
|
Common shareholders'
equity
|
1,635,587
|
|
1,542,904
|
|
1,540,441
|
|
1,517,296
|
|
1,492,818
|
|
Total shareholders'
equity
|
1,676,220
|
|
1,583,537
|
|
1,581,074
|
|
1,557,929
|
|
1,533,451
|
|
Total liabilities and
shareholders' equity
|
$
12,900,757
|
|
$
12,187,840
|
|
$
12,081,087
|
|
$
11,910,495
|
|
$
11,611,018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Supplementary
data
|
|
|
|
|
|
|
|
|
|
|
Total average
non-maturity deposits
|
$
5,981,763
|
|
$
5,617,013
|
|
$
5,567,790
|
|
$
5,569,733
|
|
$
5,713,344
|
|
Total average
deposits
|
9,574,785
|
|
9,046,388
|
|
8,797,311
|
|
8,844,251
|
|
8,592,190
|
|
Fully taxable
equivalent income adjustment
|
1,882
|
|
1,809
|
|
1,763
|
|
1,807
|
|
2,033
|
|
Total average
tangible equity (4)
|
1,120,614
|
|
1,032,571
|
|
1,028,868
|
|
1,003,570
|
|
978,860
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Total loans
include non-accruing loans.
|
|
|
|
|
|
|
|
|
|
|
(2) Average balances
for securities available-for-sale are based on amortized
cost.
|
|
|
|
|
|
(3) Excludes
discontinued operations for presentation purposes. Performance
ratios are calculated including the impact of discontinued
operations.
|
|
(4) See page F-9 for
details on the calculation of total average tangible
equity.
|
|
|
|
|
BERKSHIRE HILLS
BANCORP, INC.
|
ASSET QUALITY
ANALYSIS - UNAUDITED - (F-8)
|
|
|
At or for the
Quarters Ended
|
|
|
June 30,
|
|
March 31,
|
|
Dec. 31,
|
|
Sept. 30,
|
|
June 30,
|
|
(in
thousands)
|
|
2019
|
|
2019
|
|
2018
|
|
2018
|
|
2018
|
|
NON-PERFORMING
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
Non-accruing
loans:
|
|
|
|
|
|
|
|
|
|
|
|
Commercial real
estate
|
|
$
19,366
|
|
$
18,513
|
|
$
20,372
|
|
$
22,639
|
|
$
10,338
|
|
Commercial and
industrial loans
|
|
9,256
|
|
5,614
|
|
6,003
|
|
4,914
|
|
4,029
|
|
Residential
mortgages
|
|
3,579
|
|
2,341
|
|
2,217
|
|
2,683
|
|
3,196
|
|
Consumer
loans
|
|
3,570
|
|
4,038
|
|
3,834
|
|
4,401
|
|
5,466
|
|
Total non-accruing
loans
|
|
35,771
|
|
30,506
|
|
32,426
|
|
34,637
|
|
23,029
|
|
Other real estate
owned
|
|
154
|
|
-
|
|
-
|
|
-
|
|
-
|
|
Repossessed
assets
|
|
874
|
|
742
|
|
1,209
|
|
1,069
|
|
1,241
|
|
Total non-performing
assets
|
|
$
36,799
|
|
$
31,248
|
|
$
33,635
|
|
$
35,706
|
|
$
24,270
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total non-accruing
loans/total loans
|
|
0.36%
|
|
0.34%
|
|
0.36%
|
|
0.39%
|
|
0.26%
|
|
Total non-performing
assets/total assets
|
|
0.27%
|
|
0.26%
|
|
0.28%
|
|
0.30%
|
|
0.20%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
PROVISION AND
ALLOWANCE FOR LOAN LOSSES
|
|
|
|
|
|
|
|
|
|
|
Balance at beginning
of period
|
|
$
62,038
|
|
$
61,469
|
|
$
58,457
|
|
$
55,925
|
|
$
53,859
|
|
Charged-off
loans
|
|
(3,966)
|
|
(4,579)
|
|
(4,029)
|
|
(4,471)
|
|
(5,714)
|
|
Recoveries on
charged-off loans
|
|
617
|
|
1,147
|
|
325
|
|
375
|
|
1,248
|
|
Net loans
charged-off
|
|
(3,349)
|
|
(3,432)
|
|
(3,704)
|
|
(4,096)
|
|
(4,466)
|
|
Provision for loan
losses
|
|
3,467
|
|
4,001
|
|
6,716
|
|
6,628
|
|
6,532
|
|
Balance at end of
period
|
|
$
62,156
|
|
$
62,038
|
|
$
61,469
|
|
$
58,457
|
|
$
55,925
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Allowance for loan
losses/total loans
|
|
0.63%
|
|
0.69%
|
|
0.68%
|
|
0.66%
|
|
0.64%
|
|
Allowance for loan
losses/non-accruing loans
|
|
174%
|
|
203%
|
|
190%
|
|
169%
|
|
243%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NET LOAN
CHARGE-OFFS
|
|
|
|
|
|
|
|
|
|
|
|
Commercial real
estate
|
|
$
(1,235)
|
|
$
(752)
|
|
$
(1,357)
|
|
$
(3,074)
|
|
$
(2,079)
|
|
Commercial and
industrial loans
|
|
(995)
|
|
(1,580)
|
|
(1,538)
|
|
(189)
|
|
(1,193)
|
|
Residential
mortgages
|
|
(139)
|
|
(95)
|
|
(108)
|
|
61
|
|
(632)
|
|
Home
equity
|
|
(300)
|
|
(257)
|
|
(116)
|
|
(242)
|
|
108
|
|
Auto and other
consumer
|
|
(680)
|
|
(748)
|
|
(585)
|
|
(652)
|
|
(670)
|
|
Total, net
|
|
$
(3,349)
|
|
$
(3,432)
|
|
$
(3,704)
|
|
$
(4,096)
|
|
$
(4,466)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net charge-offs (QTD
annualized)/average loans
|
0.14%
|
|
0.15%
|
|
0.17%
|
|
0.19%
|
|
0.21%
|
|
Net charge-offs (YTD
annualized)/average loans
|
0.15%
|
|
0.15%
|
|
0.18%
|
|
0.19%
|
|
0.19%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
DELINQUENT AND
NON-ACCRUING LOANS/TOTAL LOANS
|
|
|
|
|
|
|
|
|
|
30-89 Days
delinquent
|
|
0.20%
|
|
0.22%
|
|
0.27%
|
|
0.38%
|
|
0.22%
|
|
90+ Days delinquent
and still accruing
|
|
0.28%
|
|
0.23%
|
|
0.22%
|
|
0.22%
|
|
0.40%
|
|
Total accruing
delinquent loans
|
|
0.48%
|
|
0.45%
|
|
0.49%
|
|
0.60%
|
|
0.62%
|
|
Non-accruing
loans
|
|
0.36%
|
|
0.34%
|
|
0.36%
|
|
0.39%
|
|
0.26%
|
|
Total delinquent and
non-accruing loans
|
|
0.84%
|
|
0.79%
|
|
0.85%
|
|
0.99%
|
|
0.88%
|
|
BERKSHIRE HILLS
BANCORP, INC.
|
RECONCILIATION OF
NON-GAAP FINANCIAL MEASURES AND SUPPLEMENTARY DATA- UNAUDITED -
(F-9)
|
|
|
At or for the
Quarters Ended
|
|
|
June 30,
|
|
March 31,
|
|
Dec. 31,
|
|
Sept. 30,
|
|
June 30,
|
|
(in
thousands)
|
|
2019
|
|
2019
|
|
2018
|
|
2018
|
|
2018
|
|
Net income
|
|
$
25,448
|
|
$
23,635
|
|
$
14,259
|
|
$
32,227
|
|
$
34,031
|
|
Adj: Net securities
(gains)/losses (1)
|
|
(17)
|
|
(2,551)
|
|
3,023
|
|
(88)
|
|
(718)
|
|
Adj: Net
losses/(gains) on sale of business operations and assets
|
-
|
|
-
|
|
-
|
|
-
|
|
21
|
|
Adj: Merger and
acquisition expense
|
|
9,711
|
|
1,609
|
|
2,792
|
|
198
|
|
847
|
|
Adj: Restructuring
expense and other expense
|
|
1,444
|
|
5,406
|
|
1,822
|
|
-
|
|
-
|
|
Adj: Legal
settlements
|
|
-
|
|
-
|
|
3,000
|
|
-
|
|
-
|
|
Adj: Systems vendor
restructuring costs
|
|
-
|
|
-
|
|
8,379
|
|
-
|
|
-
|
|
Adj: (Income)/loss
from discontinued operations before income taxes
|
(2,082)
|
|
854
|
|
3,884
|
|
1,147
|
|
(426)
|
|
Adj: Income
taxes
|
|
(2,385)
|
|
(1,223)
|
|
(5,185)
|
|
(397)
|
|
-
|
|
Total core income
(2)
|
(A)
|
$
32,119
|
|
$
27,730
|
|
$
31,974
|
|
$
33,087
|
|
$
33,755
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total revenue from
continuing operations
|
|
$
109,107
|
|
$
107,181
|
|
$
108,541
|
|
$
108,419
|
|
$
109,915
|
|
Adj: Net securities
(gains)/losses (1)
|
|
(17)
|
|
(2,551)
|
|
3,023
|
|
(88)
|
|
(718)
|
|
Adj: Net
losses/(gains) on sale of business operations and assets
|
-
|
|
-
|
|
-
|
|
-
|
|
21
|
|
Total core revenue
(2)
|
(B)
|
$
109,090
|
|
$
104,630
|
|
$
111,564
|
|
$
108,331
|
|
$
109,218
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total non-interest
expense from continuing operations
|
|
$
76,568
|
|
$
71,991
|
|
$
80,373
|
|
$
59,627
|
|
$
61,527
|
|
Less: Merger,
restructuring and other expense (see above)
|
|
(11,155)
|
|
(7,015)
|
|
(4,614)
|
|
(198)
|
|
(847)
|
|
Less: Legal
settlements
|
|
-
|
|
-
|
|
(3,000)
|
|
-
|
|
-
|
|
Less: Systems vendor
restructuring costs
|
|
-
|
|
-
|
|
(8,379)
|
|
-
|
|
-
|
|
Core non-interest
expense (2)
|
(C)
|
$
65,413
|
|
$
64,976
|
|
$
64,380
|
|
$
59,429
|
|
$
60,680
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in millions,
except per share data)
|
|
|
|
|
|
|
|
|
|
|
|
Total average
assets
|
(D)
|
$
12,901
|
|
$
12,188
|
|
$
12,081
|
|
$
11,910
|
|
$
11,611
|
|
Total average
shareholders'
equity
|
(E)
|
1,676
|
|
1,584
|
|
1,581
|
|
1,558
|
|
1,533
|
|
Total average
tangible shareholders' equity
(2)
|
(F)
|
1,121
|
|
1,033
|
|
1,029
|
|
1,004
|
|
979
|
|
Total average
tangible common shareholders' equity
(2)
|
(G)
|
1,080
|
|
992
|
|
988
|
|
963
|
|
938
|
|
Total tangible
shareholders' equity, period-end (2)(3)
|
(H)
|
1,176
|
|
1,026
|
|
1,001
|
|
979
|
|
961
|
|
Total tangible common
shareholders' equity, period-end (2)(3)
|
(I)
|
1,136
|
|
986
|
|
961
|
|
939
|
|
921
|
|
Total tangible
assets, period-end (2)(3)
|
(J)
|
13,051
|
|
11,623
|
|
11,660
|
|
11,477
|
|
11,347
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total common shares
outstanding, period-end
(thousands)
|
(K)
|
51,045
|
|
45,522
|
|
45,417
|
|
45,420
|
|
45,420
|
|
Average diluted
shares outstanding (thousands)
|
(L)
|
49,114
|
|
46,261
|
|
46,240
|
|
46,263
|
|
46,215
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Core earnings per
common share, diluted(2)
|
(A/L)
|
$
0.65
|
|
$
0.60
|
|
$
0.69
|
|
$
0.72
|
|
$
0.73
|
|
Tangible book value
per common share, period-end (2)
|
(I/K)
|
22.25
|
|
21.66
|
|
21.15
|
|
20.68
|
|
20.28
|
|
Total tangible
shareholders' equity/total tangible assets (2)
|
(H)/(J)
|
9.01
|
|
8.83
|
|
8.59
|
|
8.53
|
|
8.47
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Performance ratios
(4)
|
|
|
|
|
|
|
|
|
|
|
|
GAAP return on
assets
|
|
0.79
|
%
|
0.78
|
|
0.47
|
%
|
1.08
|
%
|
1.17
|
%
|
Core return on assets
(2)
|
|
1.01
|
|
0.92
|
|
1.07
|
|
1.12
|
|
1.18
|
|
GAAP return on
equity
|
|
6.07
|
|
5.97
|
|
3.61
|
|
8.27
|
|
8.88
|
|
Core return on equity
(2)
|
(A/E)
|
7.67
|
|
7.00
|
|
8.09
|
|
8.49
|
|
8.81
|
|
Core return on
tangible common equity (2)(5)
|
(A+O)/(G)
|
12.21
|
|
11.44
|
|
13.21
|
|
14.02
|
|
14.68
|
|
Efficiency ratio
(2)(6)
|
(C-O)/(B+M+P)
|
56.41
|
|
59.54
|
|
54.88
|
|
52.20
|
|
52.42
|
|
Net interest
margin
|
|
3.19
|
|
3.17
|
|
3.41
|
|
3.32
|
|
3.50
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Supplementary data
(in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
Tax benefit on
tax-credit investments (7)
|
(M)
|
$
2,381
|
|
$
684
|
|
$
1,787
|
|
$
1,374
|
|
$
2,119
|
|
Non-interest income
charge on tax-credit investments (8)
|
(N)
|
(1,938)
|
|
(579)
|
|
(1,610)
|
|
(1,112)
|
|
(1,594)
|
|
Net income on
tax-credit investments
|
(M+N)
|
443
|
|
105
|
|
177
|
|
262
|
|
525
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Intangible
amortization
|
(O)
|
$
1,475
|
|
$
1,200
|
|
$
1,202
|
|
$
1,218
|
|
$
1,246
|
|
Fully taxable
equivalent income adjustment
|
(P)
|
1,882
|
|
1,809
|
|
1,763
|
|
1,807
|
|
2,033
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Net securities
(gains)/losses include the change in fair value of the Company's
equity securities in compliance with the Company's adoption of ASU
2016-01.
|
|
(2) Non-GAAP
financial measure.
|
|
|
|
|
|
|
|
|
|
|
|
(3) Total tangible
shareholders' equity is computed by taking total shareholders'
equity less the intangible assets at period-end.
|
|
|
|
|
|
Total tangible assets is
computed by taking total assets less the intangible assets at
period-end.
|
|
|
|
|
|
|
|
(4) Ratios are
annualized and based on average balance sheet amounts, where
applicable. Quarterly data may not sum to year-to-date data
due
|
|
|
|
to rounding.
|
|
|
|
|
|
|
|
|
|
|
|
(5) Core return on
tangible equity is computed by dividing the total core income
adjusted for the tax-effected amortization of intangible
assets,
|
|
|
|
assuming a 27%
marginal rate, by tangible equity.
|
|
|
|
|
|
|
|
|
|
|
|
(6) Efficiency ratio
is computed by dividing total core tangible non-interest expense by
the sum of total net interest income on a fully
|
|
|
|
taxable equivalent basis and
total core non-interest income adjusted to include tax credit
benefit of tax shelter investments.
The
|
|
|
|
Company uses this non-GAAP
measure to provide important information regarding its operational
efficiency.
|
|
|
|
|
|
|
(7) The tax benefit
is the direct reduction to the income tax provision due to tax
credits and deductions generated from investments in
historic
|
|
|
|
rehabilitation and
low-income housing.
|
|
|
|
|
|
|
|
|
|
|
|
(8) The non-interest
income charge is the reduction to the tax-advantaged investments,
which are incurred as the tax credits are
generated.
|
|
|
|
|
BERKSHIRE HILLS
BANCORP, INC.
|
|
|
|
RECONCILIATION OF
NON-GAAP FINANCIAL MEASURES AND SUPPLEMENTARY DATA - UNAUDITED -
(F-10)
|
|
|
|
|
|
At or for the Six
Months Ended
|
|
|
|
|
|
June 30,
|
|
June 30,
|
|
|
|
|
(Dollars in
thousands)
|
|
2019
|
|
2018
|
|
|
|
|
Net
(loss)/income
|
|
$
49,083
|
|
$
59,279
|
|
|
|
|
Adj: Net securities
losses/(gains) (1)
|
|
(2,568)
|
|
784
|
|
|
|
|
Adj: Net (gains) on
sale of business operations
|
|
-
|
|
(460)
|
|
|
|
|
Adj: Merger and
acquisition expenses
|
|
11,320
|
|
5,940
|
|
|
|
|
Adj: Restructuring
expense and other
|
|
6,850
|
|
-
|
|
|
|
|
Adj: (Income) from
discontinued operations before income taxes
|
|
(1,228)
|
|
(264)
|
|
|
|
|
Adj: Income
taxes
|
|
(3,608)
|
|
(1,520)
|
|
|
|
|
Total core income
(2)
|
(A)
|
$
59,849
|
|
$
63,759
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
revenue
|
|
$
216,288
|
|
$
213,564
|
|
|
|
|
Adj: Net securities
losses/(gains) (1)
|
|
(2,568)
|
|
784
|
|
|
|
|
Adj: Net (gains) on
sale of business operations
|
|
-
|
|
(460)
|
|
|
|
|
Total core
revenue(2)
|
(B)
|
$
213,720
|
|
$
213,888
|
|
|
|
|
Total non-interest
expense
|
|
$
148,559
|
|
$
126,893
|
|
|
|
|
Less: Merger,
restructuring and other expense (see above)
|
|
(18,170)
|
|
(5,940)
|
|
|
|
|
Core non-interest
expense
(2)
|
(C)
|
$
130,389
|
|
$
120,953
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in millions,
except per share data)
|
|
|
|
|
|
|
|
|
Total average
assets
|
(D)
|
$
12,546
|
|
$
11,567
|
|
|
|
|
Total average
shareholders'
equity
|
(E)
|
1,630
|
|
1,521
|
|
|
|
|
Total average
tangible shareholders' equity
(2)
|
(F)
|
1,077
|
|
965
|
|
|
|
|
Total average
tangible common shareholders' equity
(2)
|
(G)
|
1,036
|
|
925
|
|
|
|
|
Total tangible
shareholders' equity, period-end (2)(3)
|
(H)
|
1,176
|
|
961
|
|
|
|
|
Total tangible common
shareholders' equity, period-end (2)(3)
|
(I)
|
1,136
|
|
921
|
|
|
|
|
Total tangible
assets, period-end (2)(3)
|
(J)
|
13,051
|
|
11,347
|
|
|
|
|
Total common shares
outstanding, period-end
(thousands)
|
(K)
|
51,045
|
|
45,420
|
|
|
|
|
Average diluted
shares outstanding (thousands)
|
(L)
|
47,700
|
|
46,206
|
|
|
|
|
Core earnings per
common share, diluted(2)
|
(A/L)
|
$
1.25
|
|
$
1.38
|
|
|
|
|
Tangible book value
per common share, period-end (2)
|
(I/K)
|
22.25
|
|
20.28
|
|
|
|
|
Total tangible
shareholders' equity/total tangible assets (2)
|
(H)/(J)
|
9.01
|
|
8.47
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Performance ratios
(4)
|
|
|
|
|
|
|
|
|
GAAP return on
assets
|
|
0.78
|
%
|
1.03
|
%
|
|
|
|
Core return on assets
(2)
|
(A/D)
|
0.97
|
|
1.12
|
|
|
|
|
GAAP return on
equity
|
|
6.02
|
|
7.79
|
|
|
|
|
Core return on equity
(2)
|
(A/E)
|
7.34
|
|
8.38
|
|
|
|
|
Core return on
tangible common equity (2)(5)
|
(A+O)/(G)
|
11.84
|
|
14.13
|
|
|
|
|
Efficiency ratio
(2)(6)
|
(C-O)/(B+M+P)
|
57.93
|
|
53.72
|
|
|
|
|
Net interest
margin
|
|
3.18
|
|
3.43
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Supplementary
data
|
|
|
|
|
|
|
|
|
Tax benefit on
tax-credit investments (7)
|
(M)
|
$
3,065
|
|
$
2,715
|
|
|
|
|
Non-interest income
charge on tax-credit investments (8)
|
(N)
|
(2,517)
|
|
(2,100)
|
|
|
|
|
Net income on
tax-credit investments
|
(M+N)
|
548
|
|
615
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Intangible
amortization
|
(O)
|
2,675
|
|
2,514
|
|
|
|
|
Fully taxable
equivalent income adjustment
|
(P)
|
3,691
|
|
3,853
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Net securities
(gains)/losses include the change in fair value of the Company's
equity securities in compliance with the Company's
adoption
|
|
of ASU
2016-01.
|
|
|
|
|
|
|
|
(2) Non-GAAP
financial measure.
|
|
|
|
|
|
|
|
(3) Total tangible
shareholders' equity is computed by taking total shareholders'
equity less the intangible assets at period-end.
|
|
|
|
|
Total tangible
assets is computed by taking total assets less the intangible
assets at period-end.
|
|
(4) Ratios are
annualized and based on average balance sheet amounts, where
applicable. Quarterly data may not sum to year-to-date
data
|
|
due to
rounding.
|
|
|
|
|
|
|
|
(5) Core return on
tangible equity is computed by dividing the total core income
adjusted for the tax-effected amortization of
|
|
|
|
intangible assets,
assuming a 27% marginal rate, by tangible equity.
|
(6) Efficiency ratio
is computed by dividing total core tangible non-interest expense by
the sum of total net interest income on a fully
|
taxable equivalent
basis and total core non-interest income adjusted to include tax
credit benefit of tax shelter investments.
The
|
Company uses this
non-GAAP measure to provide important information regarding its
operational efficiency.
|
(7) The tax benefit
is the direct reduction to the income tax provision due to tax
credits and deductions generated from investments
in
|
|
|
|
historic
rehabilitation and low-income housing.
|
|
|
|
|
|
(8) The non-interest
income charge is the reduction to the tax-advantaged investments,
which are incurred as the tax credits are
generated.
|
|
|
|
|
|
|
|
|
|
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SOURCE Berkshire Hills Bancorp, Inc.