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Bryn Mawr Bank Corporation Reports Strong Third Quarter 2012 Earnings, Led by Robust Wealth Management Revenues and Residential Mortgage Gains

BRYN MAWR, Pa., Oct. 25, 2012 (GLOBE NEWSWIRE) -- Bryn Mawr Bank Corporation (Nasdaq:BMTC), (the "Corporation"), parent of The Bryn Mawr Trust Company (the "Bank"), today announced net income for the three months ended September 30, 2012 of $5.4 million, an increase of $195 thousand, or 3.7%, as compared to net income of $5.2 million for the same period in 2011. Diluted earnings per share of $0.41 for the three months ended September 30, 2012 remained unchanged from the same period in 2011. Included in the net income for the quarter were due diligence and merger-related expenses of $316 thousand and $188 thousand in prepayment penalties related to the early extinguishment of $9.4 million of debt. Contributing significantly to the Corporation's solid performance for the quarter was a $1.9 million increase in revenue for Wealth Management services along with a $1.1 million increase in gain on sale of mortgage loans for the three months ended September 30, 2012, as compared to the same period in 2011.

On October 25, 2012, the Board of Directors of the Corporation declared a quarterly dividend of $0.16 per share. The dividend is payable December 1, 2012, to shareholders of record as of November 6, 2012.

Ted Peters, Chairman and Chief Executive Officer commented, "The Corporation has posted yet another excellent quarter driven by strong non-interest revenue, which was able to offset increases in non-interest expense during the quarter. The revenue from Wealth Management services reported during the quarter demonstrated the impact of the May 15, 2012 acquisition of the Davidson Trust Company." Mr. Peters added, "The continuing low-interest- rate environment has helped sustain the residential mortgage refinancing trend, allowing the Corporation to record its third consecutive quarterly increase in gain on sale of residential mortgage loans. We are pleased that these sources of non-interest income have more than compensated for the continuing pressure on our net interest margin."

The previously announced acquisition of consumer and business deposit and loan accounts, as well as a branch location in Wilmington, Delaware, from the First Bank of Delaware, which is anticipated to increase loans by approximately $90 million and deposits by approximately $60 million, is expected to close during the fourth quarter of 2012. An amendment to the original purchase agreement between the Corporation and the First Bank of Delaware was filed on Form 8-K on October 18, 2012 with the Securities and Exchange Commission.

Mr. Peters continued, "We are looking forward to completing the First Bank of Delaware transaction. The acquisition will expand our footprint in Delaware, complementing Lau Associates and the Bryn Mawr Trust Company of Delaware, and enable us to establish a commercial banking foothold in the attractive Delaware market."

SIGNIFICANT ITEMS OF NOTE

  • Net income for the three months ended September 30, 2012 increased $195 thousand, or 3.7%, as compared to the same period in 2011. The Corporation experienced significant increases in revenue for Wealth Management services and gain on sale of residential mortgage loans, as well as a substantial decrease in the provision for loan and lease losses for the three months ended September 30, 2012, as compared to the same period in 2011. These improvements were partially offset by increases in salaries and employee benefits, occupancy, intangible asset amortization, due diligence and merger-related expense and other operating expenses.
  • Non-interest income of $12.2 million for the three months ended September 30, 2012, represented 43.4% of total revenue (net interest income plus non-interest income) and was a $3.0 million, or 32.2%, increase from the same period in 2011. Non-interest income represented 37.1% of total revenue for the three months ended September 30, 2011.
  • Comprising a significant portion of non-interest income, revenue from Wealth Management services for the three months ended September 30, 2012 was $8.0 million, an increase of 31.1% from the $6.1 million generated during the same period in 2011, reflecting the effects of the May 15, 2012 acquisition of the Davidson Trust Company ("DTC"). Wealth Management Division assets under management, administration, supervision and brokerage as of September 30, 2012 were $6.5 billion, an increase of $1.7 billion, or 34.2 %, from December 31, 2011, and a $2.0 billion, or 44.0% increase, from September 30, 2011. A significant portion of this increase was the result of the DTC acquisition, along with additional organic growth from within the Wealth Management division.
  • Non-interest expense for the three months ended September 30, 2012 totaled $18.9 million, an increase of $3.2 million from the same period in 2011. Factors contributing to this increase included a $1.3 million increase in salaries and employee benefits and a $333 thousand increase in occupancy-related costs, largely related to the acquisition of DTC. In addition, due diligence and merger-related expenses increased by $180 thousand related to the pending First Bank of Delaware transaction. Other increases in non-interest expense between the periods included a $433 thousand increase in deferred compensation expense which totaled $120 thousand for the three months ended September 30, 2012 as compared to a credit of $313 thousand for the same period in 2011. This deferred compensation expense is discussed below under the heading, "Correction of an Immaterial Accounting Error." In addition, the Corporation incurred a $188 thousand prepayment penalty resulting from the early extinguishment of $9.4 million of debt.
  • Tax-equivalent net interest income of $16.0 million for the three months ended September 30, 2012 increased $278 thousand, or 1.8%, from the $15.7 million of tax-equivalent net interest income for the same period in 2011.
  • The tax-equivalent net interest margin of 3.78% for the three months ended September 30, 2012 declined 12 basis points from 3.90% for the same period in 2011. The effect of this decline in tax-equivalent net interest margin was more than offset by an $84.5 million increase in average interest-earning assets, relative to a $32.4 million increase in average interest-bearing liabilities, between the two periods. In addition, the average balance of non-interest-bearing deposits increased by $39.7 million between the two periods.
  • The Corporation took strategic steps during the quarter to reduce certain of its higher rate interest-bearing liabilities. In particular, at the end of the third quarter, the Corporation prepaid $7.5 million of subordinated debt in addition to a $1.9 million commercial mortgage. These early extinguishments of debt generated a prepayment penalty of $188 thousand.
  • Net gain on sale of residential mortgage loans for the three months ended September 30, 2012 was $1.8 million as compared to $764 thousand for the same period in 2011. The 140.4% increase was attributable to a significant increase in residential mortgage loan originations between the periods as the low-rate environment continued to spur refinancing activity.
  • Deposits of $1.40 billion as of September 30, 2012 increased $16.2 million, or 1.2%, from $1.38 billion as of December 31, 2011. Primarily contributing to this slight increase was a $100.1 million increase in money market accounts, offset by decreases of $27.7 million in wholesale non-maturity deposits, $13.6 million in wholesale time deposits and $37.8 million in time deposits. Non-interest-bearing deposits continue to be strong, representing 23.4% of total deposits as of September 30, 2012.
  • Total portfolio loans and leases of $1.31 billion as of September 30, 2012 increased by $18.3 million from December 31, 2011. Loan growth was primarily concentrated in the commercial mortgage segment of the portfolio, partially offset by decreases in the construction and home equity segments of the portfolio.
  • Nonperforming loans and leases as of September 30, 2012 totaled $13.8 million, or 1.05% of portfolio loans and leases, as compared to $14.3 million, or 1.11% of portfolio loans and leases as of December 31, 2011. More recently, however, nonperforming loans and leases have declined significantly from $22.6 million at March 31, 2012 and $18.3 million at June 30, 2012.
  • The provision for loan and lease losses (the "Provision") for the three months ended September 30, 2012 was $1.0 million, a decrease of $828 thousand as compared to the same period in 2011. The decrease in the Provision between periods was primarily due to a $1.0 million reduction in net charge-offs for the three months ended September 30, 2012, as compared to the same period in 2011.
  • The allowance for loan and lease losses, as of September 30, 2012, of $13.6 million, was 1.04% of portfolio loans and leases, as compared to $12.8 million, or 0.98% of portfolio loans and leases as of December 31, 2011.
  • Available for sale investment securities as of September 30, 2012 totaled $316.6 million, as compared to $273.8 million as of December 31, 2011. The net gain on sale of available for sale investment securities for the three months ended September 30, 2012 was $416 thousand, as compared to a gain of $343 thousand for the same period in 2011.
  • The capital ratios for the Bank and the Corporation, as shown in the table below, indicate levels well above the regulatory minimum to be considered "well capitalized".
  • Construction is well underway on our full-service branch in Bala Cynwyd, Pennsylvania, just outside Philadelphia. The branch is projected to be completed and open for business before the end of the year. The Corporation is continuing to look for additional opportunities to expand in the state of Delaware in order to complement the Lau Associates and Bryn Mawr Trust of Delaware offices and the soon-to-be-acquired First Bank of Delaware branch location.

OTHER INFORMATION

Correction of an Immaterial Accounting Error

In September 2012, the Corporation identified an immaterial accounting error related to two of its deferred compensation plans. The provisions of the deferred compensation plans enabled certain executives and directors to have bonus payments and director fees deferred, and allowed the participants to direct the investment of these deferred amounts. Because one of the investment choices offered to the participants was the Corporation's common stock, this stock was placed in a trust owned by the Corporation whose fair market value was periodically adjusted to reflect changes in the stock's price. The portion of this trust that contained the Corporation's common stock was incorrectly reported as an asset on the Corporation's balance sheet. Changes in the fair market value of the asset were reflected as increases or decreases in the value of the asset, as well as increases or decreases in the value of the liability to the participants. The stock held in the trust should have been classified as treasury stock and should have been reported in the stockholders' equity section of the Corporation's balance sheet, at cost. The resulting corrections involved adjustments to assets and stockholders' equity, as well as adjustments to other operating expense, as changes in the fair market value of the Corporation's common stock held in the trust are charged to deferred compensation expense, a component of other operating expense. All periods presented in the tables accompanying this earnings release have been revised to reflect this correction. In addition, a reconciliation of net income, basic and diluted earnings per common share, total assets, retained earnings, and number of shares and cost of treasury stock, indicating their originally reported amounts and their corrected amounts, is included in the table below.

EARNINGS CONFERENCE CALL

The Corporation will hold an earnings conference call at 8:30 a.m. EDT on Friday, October 26, 2012. Interested parties may participate by calling 1-877-317-6789, conference number 10018204. A taped replay of the conference call will be available within one hour after the conclusion of the call and will remain available through November 12, 2012. The number to call for the taped replay is 1-877-344-7529 and the Replay Passcode is 10018204.

The conference call will be simultaneously broadcast live over the Internet through a webcast on the investor relations portion of the Bryn Mawr Bank Corporation's website. To access the call, please visit the website at http://www.bmtc.com/investor_01.cfm. An online archive of the webcast will be available within one hour of the conclusion of the call. The Corporation has also recently expanded its Investor Relations website to include added resources and information for shareholders and interested investors. Interested parties are encouraged to utilize the expanded resources of the site for more information on Bryn Mawr Bank Corporation or by calling Aaron Strenkoski, Vice President – Finance/Investor Relations at 610-581-4822.

FORWARD LOOKING STATEMENTS AND SAFE HARBOR

This press release contains statements which, to the extent that they are not recitations of historical fact may constitute forward-looking statements for purposes of the Securities Act of 1933, as amended, and the Securities Exchange Act of 1934, as amended. Such forward-looking statements may include financial and other projections as well as statements regarding the Corporation's future plans, objectives, performance, revenues, growth, profits, operating expenses or the Corporation's underlying assumptions. The words "may," "would," "should," "could," "will," "likely," "possibly," "expect," "anticipate," "intend," "estimate," "target," "potentially," "probably," "outlook," "predict," "contemplate," "continue," "plan," "forecast," "project," "are optimistic," "are looking," "are looking forward" and "believe" or other similar words and phrases may identify forward-looking statements. Persons reading this press release are cautioned that such statements are only predictions, and that the Corporation's actual future results or performance may be materially different.

Such forward-looking statements involve known and unknown risks and uncertainties. A number of factors, many of which are beyond the Corporation's control, could cause our actual results, events or developments, or industry results, to be materially different from any future results, events or developments expressed, implied or anticipated by such forward-looking statements, and so our business and financial condition and results of operations could be materially and adversely affected. Such factors include, among others, our need for capital, our ability to control operating costs and expenses, and to manage loan and lease delinquency rates; the credit risks of lending activities and overall quality of the composition of our loan, lease and securities portfolio; the impact of economic conditions, consumer and business spending habits, and real estate market conditions on our business and in our market area; changes in the levels of general interest rates, deposit interest rates, or net interest margin and funding sources; changes in banking regulations and policies and the possibility that any banking agency approvals we might require for certain activities will not be obtained in a timely manner or at all or will be conditioned in a manner that would impair our ability to implement our business plans; changes in accounting policies and practices; the inability of key third-party providers to perform their obligations to us; our ability to attract and retain key personnel; competition in our marketplace; war or terrorist activities; material differences in the actual financial results, cost savings and revenue enhancements associated with our acquisitions including our acquisition of Davidson Trust Company and the anticipated acquisition of First Bank of Delaware; and other factors as described in our securities filings. All forward-looking statements and information set forth herein are based on management's current beliefs and assumptions as of the date hereof and speak only as of the date they are made. The Corporation does not undertake to update forward-looking statements.

For a more complete discussion of the assumptions, risks and uncertainties related to our business, you are encouraged to review our filings with the Securities and Exchange Commission, including our most recent annual report on Form 10-K, as well as any changes in risk factors that we may identify in our quarterly or other reports filed with the SEC.

Bryn Mawr Bank Corporation
Consolidated Statements of Income - (unaudited)
(Dollars in thousands, except per share data)
For The Three Months Ended
Sep 30, Jun 30, Mar 31, Dec 31, Sept 30,
2012 2012 2012 2011 2011
Interest income $ 18,081 $ 18,188 $ 18,372 $ 18,727 $ 18,691
Interest expense 2,130 2,285 2,387 2,772 3,018
Net interest income 15,951 15,903 15,985 15,955 15,673
Provision for loan and lease losses 1,000 1,003 1,000 1,056 1,828
Net interest income after provision for loan and lease losses 14,951 14,900 14,985 14,899 13,845
Fees for wealth management services 7,993 7,211 6,229 6,306 6,098
Loan servicing and other fees 432 436 435 454 449
Service charges on deposits 634 609 580 654 646
Net gain on sale of residential mortgage loans 1,837 1,304 1,170 699 764
Net gain on sale of available for sale investments 416 716 -- 373 343
Net (loss) gain on sale of other real estate owned ("OREO") (45) -- (41) (38) 70
BOLI income 107 105 118 114 115
Other operating income 874 1,000 1,096 909 779
Non-interest income 12,248 11,381 9,587 9,471 9,264
Salaries and wages 8,703 8,075 7,505 7,404 7,639
Employee benefits 1,903 2,023 2,160 1,889 1,674
Occupancy and bank premises 1,488 1,395 1,375 1,424 1,225
Furniture fixtures and equipment 935 940 891 938 865
Advertising 267 359 320 257 204
Net impairment (recovery) of mortgage servicing rights 105 87 (110) 114 468
Amortization of mortgage servicing rights 243 256 219 225 197
Intangible asset amortization 669 560 509 522 541
FDIC insurance 262 234 219 218 238
Merger related / due diligence expense 316 914 209 (79) 135
Professional fees 609 571 657 647 516
Other operating expenses 3,389 2,714 2,841 3,180 1,970
Non-interest expense 18,889 18,128 16,795 16,739 15,672
Income before income taxes 8,310 8,153 7,777 7,631 7,437
Income tax expense 2,885 2,808 2,704 2,627 2,207
Net income $ 5,425 $ 5,345 $ 5,073 $ 5,004 $ 5,230
Per share data:
Weighted average shares outstanding 13,149,050 13,072,963 12,979,746 12,901,266 12,861,926
Dilutive common shares 146,377 158,570 147,502 99,964 36,306
Adjusted weighted average dilutive shares 13,295,427 13,231,533 13,127,248 13,001,230 12,898,232
Basic earnings per common share $0.41 $0.41 $0.39 $0.39 $0.41
Diluted earnings per common share $0.41 $0.40 $0.39 $0.38 $0.41
Dividend declared per share $0.16 $0.16 $0.16 $0.15 $0.15
Effective tax rate 34.7% 34.4% 34.8% 34.4% 29.7%
Bryn Mawr Bank Corporation
Consolidated Statements of Income - (unaudited)
(Dollars in thousands, except per share data)
For The Nine Months Ended
Sep 30, Sep 30,
2012 2011
Interest income $ 54,641 $ 55,836
Interest expense 6,802 8,889
Net interest income 47,839 46,947
Provision for loan and lease losses 3,003 5,032
Net interest income after provision for loan and lease losses 44,836 41,915
Fees for wealth management services 21,433 15,363
Loan servicing and other fees 1,303 1,370
Service charges on deposits 1,823 1,841
Net gain on sale of residential mortgage loans 4,311 1,818
Net gain on sale of available for sale investments 1,132 1,410
BOLI income 330 348
Net loss on sale of other real estate owned ("OREO") (86) (59)
Other operating income 2,970 2,497
Non-interest income 33,216 24,588
Salaries and wages 24,283 20,680
Employee benefits 6,086 5,000
Occupancy and bank premises 4,258 3,752
Furniture fixtures and equipment 2,766 2,571
Advertising 946 909
Net impairment of mortgage servicing rights 82 672
Amortization of mortgage servicing rights 718 524
Intangible asset amortization 1,738 968
FDIC insurance 715 968
Merger expense 1,410 457
Due diligence 29 159
Merger related / due diligence expense 1,439 616
Professional fees 1,837 1,664
Other operating expenses 8,944 6,666
Non-interest expense 53,812 44,990
Income before income taxes 24,240 21,513
Income tax expense 8,397 6,915
Net income $ 15,843 $ 14,598
Per share data:
Weighted average shares outstanding 13,067,551 12,578,460
Dilutive common shares 133,799 22,512
Adjusted weighted average shares 13,201,350 12,600,972
Basic earnings per common share $1.21 $1.16
Diluted earnings per common share $1.20 $1.16
Dividend declared per share $0.48 $0.45
Effective tax rate 34.6% 32.1%
Bryn Mawr Bank Corporation
Consolidated Balance Sheets - (unaudited)
(Dollars in thousands)
Sep 30, June 30, Mar 31, Dec 31, Sept 30,
2012 2012 2012 2011 2011
Assets
Interest bearing deposits with banks $ 23,455 $ 68,133 $ 55,548 $ 57,265 $ 52,205
Money market funds 104 191 211 104 106
Investment securities - available for sale 316,644 331,407 328,215 273,822 277,187
Investment securities - trading 1,399 1,342 1,556 1,436 1,318
Loans held for sale 3,420 1,668 5,784 1,588 4,857
Portfolio loans:
Consumer 17,342 15,920 13,644 11,429 12,235
Commercial & industrial 274,351 264,116 270,766 267,204 271,228
Commercial mortgages 472,354 445,254 430,896 419,130 414,656
Construction 22,161 33,815 51,274 52,844 59,303
Residential mortgages 301,054 304,249 306,911 306,478 279,696
Home equity lines & loans 195,315 202,676 202,015 207,917 209,687
Leases 31,136 30,549 28,974 30,390 31,552
Total portfolio loans and leases 1,313,713 1,296,579 1,304,480 1,295,392 1,278,357
Earning assets 1,658,735 1,699,320 1,695,794 1,629,607 1,614,030
Cash and due from banks 13,526 13,147 11,939 11,771 10,801
Allowance for loan and lease losses (13,638) (13,140) (13,040) (12,753) (11,654)
Premises and equipment 29,238 28,911 28,680 29,328 29,615
Accrued interest receivable 5,963 6,009 6,037 6,061 6,075
Mortgage servicing rights 4,257 4,220 4,217 4,041 4,206
Goodwill 29,588 29,752 24,689 24,689 23,169
Other intangible assets 22,351 22,855 17,504 18,014 18,536
Bank owned life insurance ("BOLI") 19,765 19,658 19,552 19,434 19,321
FHLB stock 10,717 10,746 11,009 11,588 12,198
Net Deferred income tax asset 11,478 11,432 12,991 13,845 13,874
Other investments 4,438 4,424 4,095 4,107 3,524
Other assets 18,111 16,021 12,944 13,641 12,075
Total assets $ 1,814,529 $ 1,853,355 $ 1,836,411 $ 1,773,373 $ 1,755,770
Liabilities and shareholders' equity
Interest-bearing checking $ 226,206 $ 237,126 $ 235,841 $ 233,562 $ 224,609
Money market 493,829 468,314 418,503 393,729 384,463
Savings 132,402 133,204 135,912 130,613 130,910
Wholesale non-maturity deposits 37,458 35,365 66,518 65,173 65,428
Wholesale time deposits 9,942 22,505 22,062 23,550 28,992
Time deposits 171,498 193,081 212,003 209,333 224,331
Interest-bearing deposits 1,071,335 1,089,595 1,090,839 1,055,960 1,058,733
Non-interest bearing deposits 327,214 336,972 334,918 326,409 292,415
Total deposits 1,398,549 1,426,567 1,425,757 1,382,369 1,351,148
Subordinated debentures 15,000 22,500 22,500 22,500 22,500
Junior subordinated debentures -- -- -- -- 11,992
Short-term borrowings 11,629 14,675 13,254 12,863 22,535
FHLB advances and other borrowings 162,816 169,589 164,697 147,795 140,532
Other liabilities 25,280 23,956 20,538 23,466 21,278
Shareholders' equity 201,255 196,068 189,665 184,380 185,785
Total liabilities and shareholders' equity $ 1,814,529 $ 1,853,355 $ 1,836,411 $ 1,773,373 $ 1,755,770
Bryn Mawr Bank Corporation
Consolidated Quarterly Average Balance Sheets - (unaudited)
(Dollars in thousands)
2012 2012 2012 2011 2011
3Q 2Q 1Q 4Q 3Q
Assets
Interest bearing deposits with banks $ 53,576 $ 57,542 $ 38,337 $ 56,570 $ 57,855
Money market funds 191 192 219 109 108
Investment securities - available for sale 328,051 321,420 304,215 279,405 283,254
Investment securities - trading 1,343 1,546 1,437 1,319 1,338
Loans held for sale 2,972 3,810 3,935 3,888 6,060
Portfolio loans and leases 1,300,811 1,290,209 1,295,617 1,282,916 1,253,804
Earning assets 1,686,944 1,674,719 1,643,760 1,624,207 1,602,419
Cash and due from banks 12,922 12,259 11,539 11,516 11,905
Allowance for loan and lease losses (13,337) (13,383) (13,089) (12,110) (11,790)
Premises and equipment 29,077 28,866 29,095 29,586 29,706
Goodwill 29,751 26,201 24,688 23,186 23,169
Other intangible assets 22,580 21,427 17,804 18,319 18,860
Bank owned life insurance 19,695 19,589 19,480 19,359 19,246
Deferred income taxes 11,179 12,212 13,637 13,972 13,404
Other assets 33,992 34,651 36,735 35,665 35,501
Total assets $ 1,832,803 $ 1,816,541 $ 1,783,649 $ 1,763,700 $ 1,742,420
Liabilities and shareholders' equity
Interest-bearing checking $ 229,853 $ 236,131 $ 227,817 $ 224,648 $ 225,569
Money market 486,798 436,717 406,972 394,150 367,276
Savings 133,315 133,105 132,451 132,617 131,421
Wholesale non-maturity deposits 35,956 47,463 65,117 65,127 65,177
Wholesale time deposits 13,809 22,280 22,354 27,749 29,187
Time deposits 178,711 203,344 210,973 214,684 234,645
Interest-bearing deposits 1,078,442 1,079,040 1,065,684 1,058,975 1,053,275
Non-interest bearing deposits 330,179 323,539 305,468 304,883 290,468
Total deposits 1,408,621 1,402,579 1,371,152 1,363,858 1,343,743
Subordinated debentures 21,114 22,500 22,500 22,500 22,500
Junior subordinated debentures -- -- -- 10,294 12,000
Short-term borrowings 13,273 13,149 13,885 15,147 10,908
FHLB advances and other borrowings 167,251 163,908 165,402 140,177 148,963
Other liabilities 25,100 23,158 25,259 24,991 21,482
Shareholders' equity 197,444 191,247 185,451 186,733 182,824
Total liabilities and shareholders' equity $ 1,832,803 $ 1,816,541 $ 1,783,649 $ 1,763,700 $ 1,742,420
Bryn Mawr Bank Corporation
Consolidated Average Balance Sheets - (unaudited)
(Dollars in thousands)
2012 2011
Year-to-Date Year-to-Date
Assets
Interest bearing deposits with banks $ 49,832 $ 50,778
Money market funds 201 167
Investment securities - available for sale 317,932 296,524
Investment securities - trading 1,442 1,345
Loans held for sale 3,435 4,299
Portfolio loans and leases 1,295,700 1,233,393
Earning assets 1,668,542 1,586,506
Cash and due from banks 12,242 12,249
Allowance for loan and lease losses (13,270) (11,157)
Premises and equipment 29,013 29,389
Goodwill 26,890 20,211
Intangible assets 20,611 12,554
Bank owned life insurance 19,588 19,130
FHLB stock 10,824 12,851
Deferred tax asset 12,339 14,133
Other assets 24,298 25,013
Total assets $ 1,811,077 $ 1,720,879
Liabilities and shareholders' equity
Interest-bearing checking $ 231,262 $ 227,566
Money market 443,654 353,965
Savings 132,958 131,692
Wholesale non-maturity deposits 49,462 68,691
Wholesale time deposits 19,460 31,333
Time deposits 197,607 237,948
Interest-bearing deposits 1,074,403 1,051,195
Non-interest bearing deposits 319,767 281,714
Total deposits 1,394,170 1,332,909
Subordinated debentures 22,035 22,500
FHLB advances and other borrowings 165,717 147,189
Junior subordinated debentures -- 12,012
Short-term borrowings 13,244 10,110
Other liabilities 24,508 23,095
Shareholders' equity 191,403 173,064
Total liabilities and shareholders' equity $ 1,811,077 $ 1,720,879
Bryn Mawr Bank Corporation
Consolidated Selected Financial Data - (unaudited)
(Dollars in thousands, except per share data )
September 30, 2012
For the period end: 2012 2012 2012 2011 2011
3Q 2Q 1Q 4Q 3Q
Asset Quality Data
Nonaccrual loans and leases $ 13,816 $ 14,929 $ 22,570 $ 14,315 $ 14,208
90 + days past due loans - still accruing -- 3,376 -- -- --
Nonperforming loans and leases 13,816 18,305 22,570 14,315 14,208
Other real estate owned 412 865 404 549 1,301
Total nonperforming assets $ 14,228 $ 19,170 $ 22,974 $ 14,864 $ 15,509
Troubled debt restructurings included in nonperforming $ 3,740 $ 4,005 $ 4,223 $ 4,300 $ 901
Troubled debt restructurings in compliance with modified terms 8,379 8,302 7,970 7,166 7,182
Total troubled debt restructurings $ 12,119 $ 12,307 $ 12,193 $ 11,466 $ 8,083
Nonperforming loans and leases / portfolio loans 1.05% 1.41% 1.73% 1.11% 1.11%
Nonperforming assets / assets 0.78% 1.03% 1.25% 0.84% 0.88%
Net loan charge-offs (recoveries) (annualized) / average loans 0.16% 0.26% 0.21% -0.02% 0.49%
Net lease (recoveries) charge-offs (annualized) / average leases -0.23% 0.94% 0.67% 0.22% 0.37%
Net loan and lease charge-offs (recoveries) (annualized) / average loans and leases 0.16% 0.28% 0.23% -0.01% 0.49%
Delinquency rate - loans and leases >30days 1.01% 1.36% 1.52% 1.37% 1.33%
Delinquent loans and leases - 30-89 days $ 1,954 $ 2,722 $ 5,468 $ 5,311 $ 4,480
Delinquency rate - loans and leases 30-89 days 0.15% 0.21% 0.28% 0.29% 0.35%
Changes in the allowance for loan and lease losses
Balance, beginning of period $ 13,140 $ 13,040 $ 12,753 $ 11,654 $ 11,341
Charge-offs (618) (960) (839) (466) (1,817)
Recoveries 116 57 126 509 302
Net (charge-offs) / recoveries (502) (903) (713) 43 (1,515)
Provision for loan and lease losses 1,000 1,003 1,000 1,056 1,828
Balance, end of period $ 13,638 $ 13,140 $ 13,040 $ 12,753 $ 11,654
Allowance for loan and lease losses / loans and leases 1.04% 1.01% 1.00% 0.98% 0.91%
Allowance for loan and lease losses / nonperforming loans and leases 98.7% 71.8% 57.8% 89.1% 82.0%
Bryn Mawr Bank Corporation
Consolidated Selected Financial Data - (unaudited)
(Dollars in thousands, except per share data )
September, 2012
For the period and period end: 2012 2012 2012 2011 2011
3Q 2Q 1Q 4Q 3Q
Selected ratios (annualized):
Return on average assets 1.18% 1.18% 1.14% 1.13% 1.14%
Return on average shareholders' equity 10.93% 11.24% 11.00% 10.63% 11.35%
Return on average tangible equity (a non-GAAP measure) (2) 14.87% 14.97% 14.27% 13.67% 14.74%
Yield on loans and leases* 5.21% 5.31% 5.33% 5.45% 5.52%
Yield on interest earning assets* 4.28% 4.39% 4.51% 4.59% 4.64%
Cost of interest bearing funds 0.66% 0.72% 0.76% 0.88% 0.96%
Net interest margin* 3.78% 3.84% 3.93% 3.91% 3.90%
Book value per share $ 15.02 $ 14.73 $ 14.40 $ 14.07 $ 14.29
Tangible book value per share $ 11.14 $ 10.77 $ 11.20 $ 10.78 $ 11.08
Period end shares outstanding 13,399,635 13,316,469 13,168,555 13,106,353 12,999,712
Selected data:
Mortgage loans originated $ 64,455 $ 51,427 $ 55,385 $ 60,467 $ 38,998
Mortgage loans sold - servicing retained $ 54,992 $ 41,986 $ 32,778 $ 20,883 $ 26,090
Mortgage loans sold - servicing released -- 2,238 1,223 1,164 1,922
Total mortgage loans sold $ 54,992 $ 44,224 $ 34,001 $ 22,047 $ 28,012
Yield on loans sold 3.34% 2.95% 3.44% 3.17% 2.73%
Mortgage loans serviced for others $ 583,859 $ 575,533 $ 571,440 $ 574,422 $ 593,125
Total Wealth assets under management / administration / supervision / brokerage (1) $ 6,482,835 $ 6,275,940 $ 5,152,965 $ 4,831,631 $ 4,501,433
* Yield on loans and leases, interest earning assets and net interest margin are calculated on a tax equivalent basis.
(1) Brokerage Assets represent assets held at a registered broker dealer under a networking agreement.
(2) Tangible equity equals shareholders' equity minus goodwill and other intangible assets.
Bryn Mawr Bank Corporation
Consolidated Selected Financial Data - (unaudited)
(Dollars in thousands, except per share data )
September, 2012
2012 2011
Year-to-date Year-to-date
Selected ratios (annualized):
Return on average assets 1.17% 1.13%
Return on average shareholders' equity 11.06% 11.28%
Return on average tangible equity (a non-GAAP measure) (2) 14.71% 13.91%
Yield on loans and leases* 5.29% 5.60%
Yield on interest earning assets* 4.40% 4.74%
Cost of interest bearing funds 0.71% 0.96%
Net interest margin* 3.85% 3.99%
Selected data:
Mortgage loans originated $ 171,267 $ 108,214
Mortgage loans sold - servicing retained $ 129,756 $ 54,349
Mortgage loans sold - servicing released 3,461 5,066
Total mortgage loans sold $ 133,217 $ 59,415
* Yield on loans and leases, interest earning assets and net interest margin are calculated on a tax equivalent basis.
(2) Tangible equity equals shareholders' equity minus goodwill and other intangible assets.
Investment Portfolio - AFS As of September 30, 2012 As of December 31, 2011 As of Sept, 2011
($'s in thousands)
Net Net Net
Amortized Fair Unrealized Amortized Fair Unrealized Amortized Fair Unrealized
SECURITY DESCRIPTION Cost Value Gain / (Loss) Cost Value Gain / (Loss) Cost Value Gain / (Loss)
Obligations of U. S. government and agencies $ 83,472 $ 84,354 $ 882 $ 104,252 $ 104,570 $ 318 $ 114,072 $ 114,509 $ 437
State & political subdivisions 19,240 19,445 205 8,210 8,366 156 3,428 3,467 39
Mortgage backed securities 125,573 129,411 3,838 95,713 97,834 2,121 104,783 107,097 2,314
Collateralized mortgage obligations 65,168 65,621 453 32,418 32,623 205 21,695 21,920 225
Equity securities -- -- -- -- -- -- 243 284 41
Other debt securities 1,900 1,900 -- 1,900 1,882 (18) 1,400 1,400 --
Bond - mutual funds 11,456 11,504 48 12,091 11,904 (187) 11,940 11,860 (80)
Investment CD's 2,365 2,382 17 2,411 2,420 9 2,425 2,430 5
Other investments 1,798 2,027 229 1,454 1,505 51 1,463 1,458 (5)
Corporate bonds -- -- -- 12,616 12,718 102 12,664 12,762 98
Total Investment Portfolio $ 310,972 $ 316,644 $ 5,672 $ 271,065 $ 273,822 $ 2,757 $ 274,113 $ 277,187 $ 3,074
Capital Ratios
Regulatory Minimum
Bryn Mawr Trust Company Consolidated To Be
Well Capitalized 9/30/2012 6/30/2012 3/31/2012 12/31/2011 9/30/2011
Tier I Capital to Risk Weighted Assets (RWA) 6.00% 11.99% 11.75% 12.17% 11.76% 11.31%
Total (Tier II) Capital to RWA 10.00% 14.09% 14.36% 14.78% 14.35% 13.81%
Tier I Leverage Ratio 5.00% 9.23% 9.14% 9.56% 9.35% 9.14%
Tangible Equity Ratio 8.85% 8.41% 8.70% 8.66% 8.78%
Bryn Mawr Bank Corporation
Tier I Capital to Risk Weighted Assets (RWA) 6.00% 11.64% 11.30% 11.52% 11.16% 11.62%
Total (Tier II) Capital to RWA 10.00% 13.74% 13.90% 14.23% 13.74% 14.11%
Tier I Leverage Ratio 5.00% 8.98% 8.80% 9.07% 8.89% 9.40%
Tangible Equity Ratio 8.58% 8.07% 8.22% 8.19% 8.41%
Bryn Mawr Bank Corporation
Quarterly Average Balances and Tax Equivalent Income and Expense and Tax Equivalent Yields - (unaudited)
3rd Quarter 2012 2nd Quarter 2012 1st Quarter 2012 4th Quarter 2011 3rd Quarter 2011
(dollars in thousands) Average
Balance
Interest
Income/
Expense
Average Rates Earned/Paid Average
Balance
Interest
Income/
Expense
Average Rates
Earned/Paid
Average
Balance
Interest
Income/
Expense
Average Rates Earned/ Paid Average Balance Interest Income/ Expense Average Rates Earned/ Paid Average Balance Interest Income/ Expense Average Rates Earned/ Paid
Assets:
Interest-bearing deposits with other banks $ 53,576 $ 34 0.25% $ 57,542 $ 30 0.21% $ 38,337 $ 23 0.24% $ 56,570 $ 27 0.19% $ 57,855 $ 29 0.20%
Money market funds 191 -- -- 192 -- -- 219 -- -- 109 -- -- 108 -- --
Investment securities available for sale:
Taxable 309,570 960 1.23% 307,371 1,067 1.40% 294,593 1,136 1.55% 272,869 1,055 1.53% 279,321 1,171 1.66%
Tax-exempt 18,481 82 1.77% 14,049 66 1.89% 9,622 53 2.22% 6,536 31 1.88% 3,933 18 1.82%
Investment securities available for sale 328,051 1,042 1.26% 321,420 1,133 304,215 1,189 1.57% 279,405 1,086 1.54% 283,254 1,189 1.67%
Investment securities - trading 1,343 5 1.48% 1,546 12 1.42% 1,437 4 1.12% 1,319 8 2.41% 1,338 8 2.37%
Loans and leases * 1,303,783 17,089 5.21% 1,294,019 17,094 5.31% 1,299,552 17,234 5.33% 1,286,804 17,672 5.45% 1,259,864 17,529 5.52%
Total interest earning assets 1,686,944 18,170 4.28% 1,674,719 18,269 4.39% 1,643,760 18,450 4.51% 1,624,207 18,793 4.59% 1,602,419 18,755 4.64%
Cash and due from banks 12,922 12,259 11,539 11,516 11,905
Less allowance for loan and lease losses (13,337) (13,383) (13,089) (12,110) (11,790)
Other assets 146,274 142,946 141,439 140,087 139,886
Total assets $ 1,832,803 $ 1,816,541 $ 1,783,649 $ 1,763,700 $ 1,742,420
Liabilities:
Savings, NOW and market rate deposits $ 849,966 $ 567 0.27% $ 805,953 $ 586 0.29% $ 767,240 $ 559 0.29% $ 751,415 $ 711 0.38% $ 724,266 $ 772 0.42%
Other wholesale deposits 35,956 34 0.38% 47,463 43 0.36% 65,117 53 0.33% 65,127 50 0.30% 65,177 51 0.31%
Wholesale deposits 13,809 21 0.60% 22,280 24 0.43% 22,354 24 0.43% 27,749 73 1.04% 29,187 86 1.17%
Time deposits 178,711 316 0.70% 203,344 412 0.81% 210,973 490 0.93% 214,684 520 0.96% 234,645 585 0.99%
Total interest-bearing deposits 1,078,442 938 0.35% 1,079,040 1,065 0.40% 1,065,684 1,126 0.42% 1,058,975 1,354 0.51% 1,053,275 1,494 0.56%
Subordinated debentures 21,114 271 5.11% 22,500 291 5.20% 22,500 291 5.20% 22,500 287 5.06% 22,500 279 4.92%
Junior subordinated debentures -- -- --- -- -- -- -- -- -- 10,294 236 9.10% 12,000 271 8.96%
Short-term borrowings 13,273 4 0.12% 13,149 5 0.15% 13,885 6 0.17% 15,147 6 0.16% 10,908 6 0.22%
FHLB advances and other borrowings 167,251 918 2.18% 163,908 924 2.27% 165,402 964 2.34% 140,177 889 2.52% 148,963 968 2.58%
Total Borrowings 201,638 1,193 2.35% 199,557 1,220 2.46% 201,787 1,261 2.51% 188,118 1,418 2.99% 194,371 1,524 3.11%
Total interest-bearing liabilities 1,280,080 2,131 0.66% 1,278,597 2,285 0.72% 1,267,471 2,387 0.76% 1,247,093 2,772 0.88% 1,247,646 3,018 0.96%
Noninterest-bearing deposits 330,179 323,539 305,468 304,883 290,468
Other liabilities 25, 259 23,158 25,259 24,991 21,482
Total noninterest-bearing liabilities 355,279 346,697 330,727 329,874 311,950
Total liabilities 1,635,359 1,625,294 1,598,198 1,576,967 1,559,596
Shareholders' equity 197,444 191,247 185,451 186,733 182,824
Total liabilities and shareholders' equity $ 1,832,803 $ 1,816,541 $ 1,783,649 $ 1,763,700 $ 1,742,420
Interest income to earning assets 4.28% 4.39% 4.51% 4.59% 4.64%
Net interest spread 3.62% 3.67% 3.75% 3.71% 3.68%
Effect of noninterest-bearing sources 0.16% 0.17% 0.18% 0.20% 0.22%
Net interest income/ margin on earning assets $ 16,039 3.78% $ 15,984 3.84% $ 16,063 3.93% $ 16,021 3.91% $ 15,737 3.90%
Tax equivalent adjustment $ 88 0.02% $ 81 0.02% $ 79 0.02% $ 66 0.02% $ 64 0.02%
* Average loans and leases include portfolio loans and leases, and loans held for sale. Non-accrual loans are also included in the average loan and leases balances.
Bryn Mawr Bank Corporation
Average Balances and Tax Equivalent Income and Expense and Tax Equivalent Yields
For the Nine Months ended September 30,
2012 2011
Average Average
Interest Rates Interest Rates
Average Income/ Earned/ Average Income/ Earned/
(dollars in thousands) Balance Expense Paid Balance Expense Paid
Assets:
Interest-bearing deposits with other banks $ 49,832 86 0.23% $ 50,778 $ 88 0.23%
Federal funds sold -- -- -- -- -- --%
Money market funds 201 -- % 167 1 0.80%
Investment securities available for sale:
Taxable 303,865 3,166 1.39% 283,354 3,824 1.80%
Tax-exempt 14,067 224 2.13% 11,486 287 3.34%
Investment securities - available for sale 317,932 3,390 1.42% 294,840 4,111 1.86%
Investment securities - trading 1,442 21 1.95% 1,345 24 2.39%
Loans and leases * 1,299,135 51,473 5.29% 1,237,692 51,882 5.60%
Total interest earning assets 1,668,542 54,949 4.40% 1,583,477 56,106 4.74%
Cash and due from banks 12,242 12,249
Less allowance for loan and lease losses (13,270) (11,157)
Other assets 143,563 137,793
Total assets $1,811,077 $1,722,362
Liabilities:
Savings,NOW and market rate deposits $807,874 $ 1,712 0.28% $713,223 $ 2,247 0.42%
Other wholesale deposits 49,463 131 0.35% 68,691 174 0.34%
Wholesale deposits 19,459 68 0.47% 31,333 248 1.06%
Time deposits 197,607 1,217 0.82% 237,948 1,765 0.99%
Total interest-bearing deposits 1,074,403 3,128 0.39% 1,051,195 4,434 0.56%
Subordinated debt 22,035 852 5.16% 22,500 835 4.96%
Junior subordinated debentures -- -- -- 12,012 814 9.06%
Short-term borrowings 13,244 14 0.14% 10,110 19 0.25%
FHLB advances and other borrowings 165,717 2,808 2.26% 147,189 2,787 2.53%
Total Borrowings 200,996 3,674 2.44% 191,811 4,455 3.11%
Total interest-bearing liabilities 1,275,399 6,802 0.71% 1,243,006 8,889 0.96%
Noninterest-bearing deposits 319,767 281,714
Other liabilities 24,508 23,095
Total noninterest-bearing liabilities 344,275 304,809
Total liabilities 1,619,674 1,547,815
Shareholders' equity 191,403 174,547
Total liabilities and shareholders' equity $ 1,811,077 $1,722,362
Interest income to earning assets 4.40% 4.74%
Net interest spread 3.69% 3.78%
Effect of noninterest-bearing sources 0.16% 0.21%
Net interest income/ margin on earning assets $ 48,147 3.85% $ 47,217 3.99%
Tax equivalent adjustment $ 307 0.02% $ 270 0.02%
* Average loans and leases include portfolio loans and leases, and loans held for sale. Non-accrual loans are also included in the
average loan and leases balances.
Effect of Immaterial Correction of Accounting Error
Income Statement Effect
(dollars in thousands except share data)
For The Three Months Ended June 30, 2012 For The Three Months Ended March 31, 2012 For The Three Months Ended December 31, 2011 For The Three Months Ended September 30, 2011
Originally
Reported
Corrected Difference Originally
Reported
Corrected Difference Originally
Reported
Corrected Difference Originally
Reported
Corrected Difference
Net Income $ 5,261 $ 5,345 $ 84 $ 5,235 $ 5,074 $ (161) $ 5,170 $ 5,004 $ (166) $ 5,022 $ 5,230 $ 208
Basic earnings per common share $ 0.40 $ 0.41 $ 0.01 $ 0.40 $ 0.39 $ (0.01) $ 0.40 $ 0.39 $ (0.01) $ 0.39 $ 0.41 $ 0.02
Diluted earnings per common share $ 0.40 $ 0.40 $ -- $ 0.40 $ 0.39 $ (0.01) $ 0.39 $ 0.39 $ -- $ 0.39 $ 0.41 $ 0.02
For The Nine Months Ended September 30, 2011
Originally
Reported
Corrected Difference
Net Income $ 14,543 $ 14,598 $ 55
Basic earnings per common share $ 1.15 $ 1.16 $ 0.01
Diluted earnings per common share $ 1.15 $ 1.16 $ 0.01
Balance Sheet Effect
(dollars in thousands except share data)
As of June 30, 2012 As of March 31, 2012 As of December 31, 2011 As of September 30, 2011
Originally
Reported
Corrected Difference Originally
Reported
Corrected Difference Originally
Reported
Corrected Difference Originally
Reported
Corrected Difference
Total assets $ 1,854,885 $ 1,853,355 $ (1,530) $ 1,838,075 $ 1,836,411 $ (1,664) $ 1,774,907 $ 1,773,373 $ (1,534) $ 1,757,119 $ 1,755,770 $ (1,349)
Retained earnings $ 132,837 $ 132,420 $ (417) $ 129,702 $ 129,201 $ (501) $ 126,582 $ 126,242 $ (340) $ 123,377 $ 123,203 $ (174)
Cost of treasury stock $ 29,789 $ 30,901 $ 1,112 $ 29,833 $ 30,995 $ 1,162 $ 29,833 $ 31,027 $ 1,194 $ 29,833 $ 31,008 $ 1,175
Shares of treasury stock 2,905,293 2,988,561 83,268 2,909,542 2,995,681 86,139 2,909,542 2,997,628 88,086 2,909,542 2,996,600 87,058
CONTACT: Ted Peters, Chairman 610-581-4800 J. Duncan Smith, CFO 610-526-2466Source:Bryn Mawr Bank Corporation

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