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Lakeland Bancorp Reports 11% Increase in Fourth Quarter EPS and Record Full Year Results

OAK RIDGE, N.J., Jan. 24, 2013 (GLOBE NEWSWIRE) -- Lakeland Bancorp, Inc. (Nasdaq:LBAI) reported the following results:

  • Net Income Available to Common Shareholders in the fourth quarter of 2012 was $5.8 million, up 21% from $4.8 million for the fourth quarter of 2011. Earnings per diluted share in the fourth quarter of 2012, was $0.20 per share, an 11% increase from $0.18 per diluted share for the same period in 2011. Net Income Available to Common Shareholders for the year ended December 31, 2012 was $21.1 million, a 19% increase from the $17.7 million for 2011, while earnings per diluted share was $0.76 per share, a 15% increase from $0.66 per diluted share for 2011.
  • The Company reported strong growth in both loans and non-interest bearing demand deposits in the fourth quarter of 2012. Loans totaling $2.15 billion at year-end 2012 increased by $82.3 million, or 4%, from September 30, 2012, while non-interest bearing demand deposits at $498.1 million increased by $12.8 million in the fourth quarter of 2012, and by $48.5 million, or 11%, in 2012.
  • Asset quality improved in 2012, as non-performing assets, which totaled $28.5 million at December 31, 2012, were 43% lower than the $50.2 million reported at year-end 2011. The Allowance for Loan and Lease Losses at year end 2012 was 103% of non-performing loans, compared to 58% at year-end 2011.
  • The Net Interest Margin for the fourth quarter of 2012 was 3.67%, as compared to 3.66% in the third quarter of 2012. The yield on interest-earning assets at 4.14% in the fourth quarter of 2012 was eleven basis points lower than 4.25% in the previous quarter, while the cost of interest-bearing liabilities at 0.59% decreased by 15 basis points from 0.74% in the third quarter, primarily as a result of reduced borrowing costs. In the fourth quarter, the Company sold securities resulting in a gain of $776,000, and repaid $10.0 million in long-term debt at a rate of 3.93%, incurring a prepayment fee of $782,000. Additionally, a $25 million Trust Preferred issuance, with a coupon rate of 7.535%, was repaid in the fourth quarter of 2012, using the proceeds from the Company's earlier capital raise in the third quarter of 2012.
  • The Company declared a quarterly cash dividend of $0.07 per common share, payable on February 15, 2013 to holders of record as of the close of business on January 31, 2013.

Thomas J. Shara, Lakeland Bancorp's President and CEO, said, "We are pleased to report record earnings for the full year 2012 despite a continuing weak economy, and a low interest rate environment. Asset quality improved as non-performing assets decreased by 43% from year-end 2011. In addition, tangible book value per common share increased 13%."

Earnings

Net Interest Income

Net interest income for the fourth quarter of 2012 was $24.2 million, which was equivalent to the same period in 2011. Net Interest Margin for the fourth quarter of 2012 was 3.67%, compared to 3.66% in the third quarter of 2012, and 3.73% reported in the fourth quarter of 2011. The yield on interest-earning assets declined 32 basis points to 4.14% in the fourth quarter of 2012 compared to 4.46% for the same period of 2011, while the cost of interest-bearing liabilities decreased 31 basis points from 0.90% in the fourth quarter of 2011 to 0.59% in the fourth quarter of 2012.

For 2012, net interest income totaled $95.5 million compared to $97.4 million reported for 2011. Net Interest Margin for 2012 at 3.70% compared to 3.85% for 2011. The Company's yield on earning assets decreased 34 basis points from 4.63% for the year ended December 31, 2011, to 4.29% for 2012. The Company's cost of interest bearing liabilities decreased 22 basis points from 0.96% for 2011 to 0.74% in 2012.

Noninterest Income

Noninterest income, exclusive of gains on sales of investment securities, totaled $4.7 million for the fourth quarter of 2012, as compared to $4.1 million for the fourth quarter of 2011. Gains on investment securities totaled $776,000 for the fourth quarter of 2012 as compared to no gains for the same period of 2011. Service charges on deposit accounts totaling $2.6 million were equivalent to the total for the fourth quarter of 2011, while commissions and fees at $1.1 million increased by $174,000 from the fourth quarter of 2011, primarily due to increased loan fees as well as a 24% increase in investment services income. Other income at $600,000 increased by $541,000, including $275,000 in net gains on the sales of properties in the fourth quarter of 2012.

Noninterest income, exclusive of gains on sales of investment securities, totaled $17.9 million for the year ended December 31, 2012 compared to $16.9 million for 2011. Gains on investment securities totaled $1.0 million for 2012 as compared to $1.2 million in 2011. Service charges on deposit accounts at $10.5 million increased by 2%, while commissions and fees at $4.5 million increased by $788,000 or 21% primarily due to increased loan fees. Gains on leasing related assets at $475,000 decreased by $499,000 in 2012 primarily due to the reduction in the size of the leasing portfolio, while other income at $1.0 million was $516,000 higher in 2012, partially due to the aforementioned net gains on sales of properties.

Noninterest Expense

Noninterest expense for the fourth quarter of 2012, excluding a $782,000 prepayment fee on the repayment of long-term debt, was $17.2 million, as compared to $16.4 million for the fourth quarter of 2011, an increase of $825,000. Salaries and benefit expenses at $10.0 million increased by 11%, in the fourth quarter of 2012, resulting from adjustments made to the discount rate on benefit plans to reflect the current interest rate environment, as well as normal salary and benefit increases. Net occupancy and furniture and equipment expense at $3.3 million increased by $437,000, or 15%, as the Company opened a new training and operations center, as well as a new branch office.

Noninterest expense for the full year ended December 31, 2012 was $67.7 million, compared to $68.2 million for 2011. Prepayment fees on the repayment of long-term debt were $782,000 and $800,000, respectively, in 2012 and 2011. Excluding the prepayment fees in both years, noninterest expense in 2012 was $66.9 million, compared to $67.4 million in 2011, a decrease of $460,000. Marketing expense at $2.0 million decreased 16%, primarily due to the elimination of several marketing programs in 2012, while FDIC insurance expense at $2.2 million decreased by $627,000, or 22%, resulting from a change in FDIC assessment rate methodology. Core deposit intangibles were fully amortized in 2011, which resulted in a $577,000 reduction in expenses in 2012, while expenses on other real estate owned and other repossessed assets declined $681,000 as compared to 2011.

Financial Condition

At December 31, 2012, total assets were $2.92 billion, an increase of $92.8 million from December 31, 2011. Total loans were $2.15 billion at year-end 2012, an increase of $105.9 million, primarily due to an increase in commercial loans of $85.5 million in 2012. Total deposits were $2.37 billion, an increase of $121.3 million from year-end 2011. Non-interest bearing demand deposits totaling $498.1 million increased by $48.5 million, or 11%. Core deposits at $2.07 billion at year-end 2012 increased by $177.1 million, and represented 87% of total deposits at December 31, 2012.

Asset Quality

At December 31, 2012, non-performing assets totaled $28.5 million (0.98% of total assets) compared to $50.2 million (1.78% of total assets) at December 31, 2011. The Allowance for Loan and Lease Losses totaled $28.9 million at December 31, 2012 and represented 1.35% of total loans and 103% of non-performing loans. In the fourth quarter of 2012, the Company had net charge-offs totaling $2.9 million and for the full year ended December 31, 2012, had net charge-offs of $14.4 million (0.69% of average loans), as compared to $17.7 million (0.89% of average loans) for the same period last year.

Capital

At December 31, 2012, stockholders' equity was $280.9 million and book value per common share was $9.45. As of December 31, 2012, the Company's leverage ratio was 8.62%. Tier I and total risk based capital ratios were 11.52% and 12.77%, respectively. These regulatory capital ratios exceed those necessary to be considered a well-capitalized institution under Federal guidelines.

Forward-Looking Statements

The information disclosed in this document includes various forward-looking statements (with respect to corporate objectives, trends, and other financial and business matters) that are made in reliance upon the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The words "anticipates", "projects", "intends", "estimates", "expects", "believes", "plans", "may", "will", "should", "could", and other similar expressions are intended to identify such forward-looking statements. Lakeland cautions that these forward-looking statements are necessarily speculative and speak only as of the date made, and are subject to numerous assumptions, risks and uncertainties, all of which may change over time. Actual results could differ materially from such forward-looking statements. The following factors, among others, could cause actual results to differ materially and adversely from such forward-looking statements: changes in the financial services industry and the U.S. and global capital markets, changes in economic conditions nationally, regionally and in the Company's markets, the nature and timing of actions of the Federal Reserve Board and other regulators, the nature and timing of legislation affecting the financial services industry, government intervention in the U.S. financial system, changes in levels of market interest rates, pricing pressures on loan and deposit products, credit risks of the Company's lending and leasing activities, customers' acceptance of the Company's products and services and competition. Any statements made by Lakeland that are not historical facts should be considered to be forward-looking statements. Lakeland is not obligated to update and does not undertake to update any of its forward-looking statements made herein.

EXPLANATION OF NON-GAAP FINANCIAL MEASURES

Reported amounts are presented in accordance with accounting principles generally accepted in the United States of America ("GAAP"). The Company's management believes that the supplemental non-GAAP information, which consists of measurements and ratios based on tangible equity and tangible assets, is utilized by regulators and market analysts to evaluate a company's financial condition and therefore, such information is useful to investors. These disclosures should not be viewed as a substitute for financial results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures which may be presented by other companies.

The Company also uses an efficiency ratio that is a non-GAAP financial measure. The ratio that the Company uses excludes amortization of core deposit intangibles, expenses on other real estate owned and other repossessed assets and, where applicable, long-term debt prepayment fees. Income for the non-GAAP ratio is increased by the favorable effect of tax-exempt income and excludes securities gains and losses, which can vary from period to period. The Company uses this ratio because it believes the ratio provides a better comparison of period to period operating performance.

Lakeland Bancorp, the holding company for Lakeland Bank, has a current asset base of $2.9 billion and forty-six (46) offices spanning six northwestern New Jersey counties: Bergen, Essex, Morris, Passaic, Sussex and Warren. Lakeland Bank, headquartered at 250 Oak Ridge Road, Oak Ridge, New Jersey, offers an extensive array of consumer and commercial products and services, including online banking, localized commercial lending teams, and 24-hour or less turnaround time on consumer loan applications. For more information about their full line of products and services, visit their website at www.lakelandbank.com.

Lakeland Bancorp, Inc.
Financial Highlights
(unaudited)
Three Months Ended December 31, Year Ended December 31,
2012 2011 2012 2011
(Dollars in thousands except per share amounts)
INCOME STATEMENT
Net Interest Income $ 24,164 $ 24,057 $ 95,513 $ 97,413
Provision for Loan and Lease Losses (3,124) (4,425) (14,907) (18,816)
Noninterest Income (excluding investment securities gains/losses) 4,661 4,082 17,856 16,888
Gains on investment securities 776 -- 1,049 1,229
Long-term debt prepayment fee (782) -- (782) (800)
Noninterest Expense (17,178) (16,353) (66,891) (67,351)
Pretax Income 8,517 7,361 31,838 28,563
Tax Expense (2,688) (2,245) (10,096) (8,712)
Net Income $ 5,829 $ 5,116 $ 21,742 $ 19,851
Dividends on Preferred Stock and Discount Accretion -- (294) (620) (2,167)
Net Income Available to Common Stockholders $ 5,829 $ 4,822 $ 21,122 $ 17,684
Basic Earnings Per Common Share (1) $ 0.20 $ 0.18 $ 0.76 $ 0.66
Diluted Earnings Per Common Share (1) $ 0.20 $ 0.18 $ 0.76 $ 0.66
Dividends per Common Share (1) $ 0.07 $ 0.057 $ 0.25 $ 0.23
Weighted Average Shares - Basic (1) 29,467 26,629 27,619 26,572
Weighted Average Shares - Diluted (1) 29,566 26,688 27,692 26,681
SELECTED OPERATING RATIOS
Annualized Return on Average Assets 0.81% 0.72% 0.77% 0.71%
Annualized Return on Average Common Equity 8.30% 8.50% 8.48% 8.53%
Annualized Return on Average Tangible Common Equity (3) 12.06% 13.39% 12.85% 13.65%
Annualized Return on Interest Earning Assets 4.14% 4.46% 4.29% 4.63%
Annualized Cost of Interest Bearing Liabilities 0.59% 0.90% 0.74% 0.96%
Annualized Net Interest Spread 3.55% 3.56% 3.55% 3.67%
Annualized Net Interest Margin 3.67% 3.73% 3.70% 3.85%
Efficiency ratio (3) 59.49% 57.67% 58.33% 56.87%
Stockholders' equity to total assets 9.62% 9.19%
Book value per common share (1) (2) $ 9.45 $ 8.99
Tangible book value per common share (1) (2) (3) $ 6.52 $ 5.75
Tangible common equity to tangible assets (2) (3) 6.84% 5.63%
ASSET QUALITY RATIOS 12/31/2012 12/31/2011
Ratio of allowance for loan and lease losses to total loans 1.35% 1.39%
Non-performing loans to total loans 1.30% 2.40%
Non-performing assets to total assets 0.98% 1.78%
Annualized net charge-offs to average loans 0.69% 0.89%
SELECTED BALANCE SHEET DATA AT PERIOD-END 12/31/2012 12/31/2011
Loans and Leases $ 2,147,207 $ 2,041,326
Allowance for Loan and Lease Losses (28,931) (28,416)
Investment Securities 496,017 543,644
Total Assets 2,918,703 2,825,950
Total Deposits 2,370,997 2,249,653
Short-Term Borrowings 117,289 72,131
Other Borrowings 136,548 232,322
Stockholders' Equity 280,867 259,783
SELECTED AVERAGE BALANCE SHEET DATA For the Three Months Ended For the Year Ended
12/31/2012 12/31/2011 12/31/2012 12/31/2011
Loans and Leases, net $ 2,103,204 $ 2,024,559 $ 2,073,562 $ 1,997,652
Investment Securities 499,455 530,171 506,042 530,850
Interest-Earning Assets 2,642,185 2,585,062 2,609,977 2,560,441
Total Assets 2,876,470 2,809,452 2,832,941 2,782,829
Non Interest-Bearing Demand Deposits 497,906 452,638 474,579 422,568
Savings Deposits 350,557 332,258 347,766 330,646
Interest-Bearing Transaction Accounts 1,236,294 1,128,338 1,171,318 1,088,678
Time Deposits 309,724 380,443 329,355 400,442
Total Deposits 2,394,481 2,293,677 2,323,018 2,242,334
Short-Term Borrowings 48,441 54,056 59,641 59,240
Other Borrowings 139,996 190,826 178,174 213,504
Total Interest-Bearing Liabilities 2,085,011 2,085,921 2,086,253 2,092,510
Stockholders' Equity 279,422 257,166 258,283 254,975
Common Stockholders' Equity 279,422 238,713 256,364 232,711
(1) Adjusted for 5% stock dividend paid on April 16, 2012 to shareholders of record March 30, 2012.
(2) Excludes preferred stock
(3) See supplemental information - non-GAAP financial measures
Lakeland Bancorp, Inc. and Subsidiaries
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
Three Months Ended December 31, Year Ended December 31,
2012 2011 2012 2011
(dollars in thousands, except per share amounts)
INTEREST INCOME
Loans and fees $24,854 $25,801 $100,513 $104,585
Federal funds sold and interest bearing deposits with banks 22 12 51 51
Taxable investment securities and other 1,906 2,434 8,574 10,882
Tax exempt investment securities 450 500 1,821 2,006
TOTAL INTEREST INCOME 27,232 28,747 110,959 117,524
INTEREST EXPENSE
Deposits 1,923 2,568 8,344 10,878
Federal funds purchased and securities sold under agreements to repurchase 11 15 79 88
Other borrowings 1,134 2,107 7,023 9,145
TOTAL INTEREST EXPENSE 3,068 4,690 15,446 20,111
NET INTEREST INCOME 24,164 24,057 95,513 97,413
Provision for loan and lease losses 3,124 4,425 14,907 18,816
NET INTEREST INCOME AFTER PROVISION FOR
LOAN AND LEASE LOSSES 21,040 19,632 80,606 78,597
NONINTEREST INCOME
Service charges on deposit accounts 2,590 2,590 10,504 10,262
Commissions and fees 1,090 916 4,491 3,703
Gains on sales of investment securities 776 -- 1,049 1,229
Income on bank owned life insurance 309 353 1,344 1,423
Gain on leasing related assets 72 164 475 974
Other income 600 59 1,042 526
TOTAL NONINTEREST INCOME 5,437 4,082 18,905 18,117
NONINTEREST EXPENSE
Salaries and employee benefits 10,008 9,035 38,586 36,500
Net occupancy expense 1,958 1,680 7,089 6,885
Furniture and equipment 1,324 1,165 4,751 4,726
Stationery, supplies and postage 336 338 1,415 1,396
Marketing expense 388 563 2,034 2,409
Amortization of core deposit intangibles -- -- -- 577
FDIC insurance expense 543 612 2,163 2,790
Collection expense (15) 148 216 343
Legal expense 356 529 1,236 1,692
Expenses on other real estate owned and other repossessed assets 10 (28) 99 780
Long-term debt prepayment fee 782 -- 782 800
Other expenses 2,270 2,311 9,302 9,253
TOTAL NONINTEREST EXPENSE 17,960 16,353 67,673 68,151
INCOME BEFORE PROVISION FOR INCOME TAXES 8,517 7,361 31,838 28,563
Provision for income taxes 2,688 2,245 10,096 8,712
NET INCOME $5,829 $5,116 $21,742 $19,851
Dividends on Preferred Stock and Discount Accretion -- 294 620 2,167
Net Income Available to Common Stockholders $5,829 $4,822 $21,122 $17,684
EARNINGS PER COMMON SHARE
Basic $0.20 $0.18 $0.76 $0.66
Diluted $0.20 $0.18 $0.76 $0.66
DIVIDENDS PER COMMON SHARE $0.07 $0.057 $0.25 $0.23
Lakeland Bancorp, Inc. and Subsidiaries
CONSOLIDATED BALANCE SHEETS
December 31, December 31,
ASSETS 2012 2011
(dollars in thousands) (unaudited)
Cash and due from banks $100,926 $60,688
Federal funds sold and interest-bearing deposits due from banks 6,619 11,870
Total cash and cash equivalents 107,545 72,558
Investment securities available for sale, at fair value 393,710 463,611
Investment securities held to maturity; fair value of $99,784 in 2012 and $74,274 in 2011 96,925 71,700
Federal Home Loan Bank Stock, at cost 5,382 8,333
Loans:
Commercial, secured by real estate 1,171,409 1,092,120
Commercial, industrial and other 216,129 209,915
Leases 26,781 28,879
Residential mortgages 423,262 406,222
Consumer and home equity 309,626 304,190
Total loans 2,147,207 2,041,326
Deferred cost (364) 249
Allowance for loan and lease losses (28,931) (28,416)
Net loans 2,117,912 2,013,159
Premises and equipment, net 33,280 27,917
Accrued interest receivable 7,643 8,369
Goodwill 87,111 87,111
Bank owned life insurance 46,143 44,760
Other assets 23,052 28,432
TOTAL ASSETS $2,918,703 $2,825,950
LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES:
Deposits:
Noninterest bearing $498,066 $449,560
Savings and interest-bearing transaction accounts 1,569,139 1,440,541
Time deposits under $100,000 188,278 211,797
Time deposits $100,000 and over 115,514 147,755
Total deposits 2,370,997 2,249,653
Federal funds purchased and securities sold under agreements to repurchase 117,289 72,131
Other borrowings 85,000 155,000
Subordinated debentures 51,548 77,322
Other liabilities 13,002 12,061
TOTAL LIABILITIES 2,637,836 2,566,167
STOCKHOLDERS' EQUITY
Preferred stock, Series A, no par value, $1,000 liquidation value, authorized 1,000,000 shares; issued 0 shares at December 31, 2012 and 19,000 shares at December 31, 2011 -- 18,480
Common stock, no par value; authorized 40,000,000 shares; issued 29,941,967 shares at December 31, 2012 and 27,275,480 shares at December 31, 2011 303,794 270,044
Accumulated Deficit (24,145) (26,061)
Treasury shares, at cost, 216,077 shares at December 31, 2012 and 439,340 shares at December 31, 2011 (2,718) (5,551)
Accumulated other comprehensive gain 3,936 2,871
TOTAL STOCKHOLDERS' EQUITY 280,867 259,783
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $2,918,703 $2,825,950
Lakeland Bancorp, Inc.
Financial Highlights
(unaudited)
For the Quarter Ended
Dec 31, Sept 30, Jun 30, Mar 31, Dec 31,
(dollars in thousands, except per share data) 2012 2012 2012 2012 2011
INCOME STATEMENT (unaudited)
Net Interest Income $ 24,164 $ 23,655 $ 23,748 $ 23,946 $ 24,057
Provision for Loan and Lease Losses (3,124) (3,350) (3,877) (4,556) (4,425)
Noninterest Income (excluding investment securities gains) 4,661 4,640 4,530 4,025 4,082
Gains on investment securities 776 -- 241 32 --
Long-term debt prepayment fee (782) -- -- -- --
Noninterest Expense, excluding long-term debt prepayment fee (17,178) (16,968) (16,470) (16,275) (16,353)
Pretax Income 8,517 7,977 8,172 7,172 7,361
Tax Expense (2,688) (2,488) (2,719) (2,201) (2,245)
Net Income $ 5,829 $ 5,489 $ 5,453 $ 4,971 $ 5,116
Dividends on Preferred Stock and Discount Accretion -- -- -- (620) (294)
Net Income Available to Common Stockholders $ 5,829 $ 5,489 $ 5,453 $ 4,351 $ 4,822
Basic Earnings Per Common Share (1) $ 0.20 $ 0.20 $ 0.20 $ 0.16 $ 0.18
Diluted Earnings Per Common Share (1) $ 0.20 $ 0.20 $ 0.20 $ 0.16 $ 0.18
Dividends per Common Share (1) $ 0.070 $ 0.060 $ 0.060 $ 0.057 $ 0.057
Weighted Average Shares - Basic (1) 29,467 27,550 26,737 26,700 26,629
Weighted Average Shares - Diluted (1) 29,566 27,642 26,800 26,747 26,688
SELECTED OPERATING RATIOS
Annualized Return on Average Assets 0.81% 0.77% 0.78% 0.71% 0.72%
Annualized Return on Average Common Equity 8.30% 8.48% 8.94% 8.23% 8.50%
Annualized Return on Tangible Common Equity (3) 12.06% 12.81% 13.87% 12.83% 13.39%
Annualized Net Interest Margin 3.67% 3.66% 3.70% 3.76% 3.73%
Efficiency ratio (3) 59.49% 58.91% 57.18% 57.71% 57.67%
Stockholders' equity to total assets 9.62% 9.71% 8.65% 8.48% 9.19%
Common stockholders' equity to total assets 9.62% 9.71% 8.65% 8.48% 8.54%
Tangible common equity to tangible assets (3) 6.84% 6.87% 5.78% 5.60% 5.63%
Tier 1 risk-based ratio 11.52% 12.24% 10.21% 9.92% 11.23%
Total risk-based ratio 12.77% 14.14% 12.59% 12.37% 13.39%
Tier 1 leverage ratio 8.62% 9.05% 7.62% 7.46% 8.33%
Book value per common share (1) (2) $ 9.45 $ 9.35 $ 9.15 $ 8.97 $ 8.99
Tangible book value per common share (1) (2) (3) $ 6.52 $ 6.41 $ 5.92 $ 5.74 $ 5.75
(1) Adjusted for 5% stock dividend paid on April 16, 2012 to shareholders of record March 30, 2012.
(2) Excludes preferred stock
(3) See Supplemental Information - Non GAAP financial measures
Lakeland Bancorp, Inc.
Financial Highlights
(unaudited)
For the Quarter Ended
Dec 31, Sept 30, Jun 30, Mar 31, Dec 31,
(dollars in thousands) 2012 2012 2012 2012 2011
(unaudited)
SELECTED BALANCE SHEET DATA AT PERIOD-END
Loans and Leases $ 2,147,207 $ 2,064,913 $ 2,088,695 $ 2,073,527 $ 2,041,326
Allowance for Loan and Lease Losses (28,931) (28,669) (28,543) (28,700) (28,416)
Investment Securities 496,017 521,294 516,432 522,761 543,644
Total Assets 2,918,703 2,859,647 2,853,202 2,852,347 2,825,950
Total Deposits 2,370,997 2,341,108 2,277,400 2,288,128 2,249,653
Short-Term Borrowings 117,289 54,581 92,958 96,453 72,131
Other Borrowings 136,548 172,322 222,322 212,322 232,323
Stockholders' Equity 280,867 277,544 246,941 241,955 259,783
Loans and Leases
Commercial real estate $ 1,171,409 $ 1,107,907 $ 1,116,726 $ 1,114,042 $ 1,092,120
Commercial, industrial and other 216,129 201,308 216,406 219,270 209,915
Leases 26,781 26,548 25,603 26,214 28,879
Residential mortgages 423,262 419,685 421,338 412,027 406,222
Consumer and Home Equity 309,626 309,465 308,622 301,974 304,190
Total loans $ 2,147,207 $ 2,064,913 $ 2,088,695 $ 2,073,527 $ 2,041,326
Deposits
Noninterest bearing $ 498,066 $ 485,256 $ 474,233 $ 476,349 $ 449,560
Savings and interest-bearing transaction accounts 1,569,139 1,535,422 1,476,127 1,473,051 1,440,541
Time deposits under $100,000 188,278 196,939 201,817 206,766 211,797
Time deposits $100,000 and over 115,514 123,491 125,223 131,962 147,755
Total deposits $ 2,370,997 $ 2,341,108 $ 2,277,400 $ 2,288,128 $ 2,249,653
SELECTED AVERAGE BALANCE SHEET DATA
Loans and Leases, net $ 2,103,204 $ 2,062,928 $ 2,077,813 $ 2,050,093 $ 2,024,559
Investment Securities 499,455 501,862 502,931 520,039 530,171
Interest-Earning Assets 2,642,185 2,598,061 2,605,294 2,592,654 2,585,062
Total Assets 2,876,470 2,827,885 2,820,789 2,806,197 2,809,452
Non Interest-Bearing Demand Deposits 497,906 477,311 473,853 448,893 452,638
Savings Deposits 350,557 350,135 352,095 338,221 332,258
Interest-Bearing Transaction Accounts 1,236,294 1,169,953 1,141,263 1,137,069 1,128,338
Time Deposits 309,724 324,355 332,669 350,937 380,443
Total Deposits 2,394,481 2,321,754 2,299,880 2,275,120 2,293,677
Short-Term Borrowings 48,441 50,180 71,558 68,612 54,056
Other Borrowings 139,996 184,023 190,478 198,553 190,826
Total Interest-Bearing Liabilities 2,085,011 2,078,647 2,088,062 2,093,392 2,085,921
Stockholders' Equity 279,422 257,557 245,253 250,676 257,164
Common Stockholders' Equity 279,422 257,557 245,253 242,957 238,713
Lakeland Bancorp, Inc.
Financial Highlights
(unaudited)
For the Quarter Ended
Dec 31, Sept 30, Jun 30, Mar 31, Dec 31,
(dollars in thousands) 2012 2012 2012 2012 2011
(unaudited)
AVERAGE ANNUALIZED YIELDS (taxable equivalent basis)
Assets:
Loans and leases 4.70% 4.81% 4.89% 4.99% 5.06%
Taxable investment securities and other 1.78% 1.96% 2.03% 2.09% 2.12%
Tax-exempt securities 3.86% 3.84% 4.09% 4.14% 4.28%
Federal funds sold and interest-bearing cash accounts 0.22% 0.20% 0.10% 0.11% 0.16%
Total interest-earning assets 4.14% 4.25% 4.35% 4.43% 4.46%
Liabilities:
Savings accounts 0.10% 0.10% 0.11% 0.11% 0.11%
Interest-bearing transaction accounts 0.36% 0.40% 0.44% 0.45% 0.51%
Time deposits 0.91% 0.94% 0.97% 1.02% 1.07%
Borrowings 2.43% 3.10% 3.13% 3.13% 3.47%
Total interest-bearing liabilities 0.59% 0.74% 0.81% 0.83% 0.90%
Net interest spread (taxable equivalent basis) 3.55% 3.51% 3.54% 3.60% 3.56%
Annualized Net Interest Margin (taxable equivalent basis) 3.67% 3.66% 3.70% 3.76% 3.73%
Annualized Cost of Deposits 0.32% 0.35% 0.37% 0.40% 0.44%
ASSET QUALITY DATA
Allowance for Loan and Lease Losses
Balance at beginning of period $ 28,669 $ 28,543 $ 28,700 $ 28,416 $ 28,024
Provision for loan losses 3,124 3,350 3,877 4,556 4,425
Net Charge-offs (2,862) (3,224) (4,034) (4,272) (4,033)
Balance at end of period $ 28,931 $ 28,669 $ 28,543 $ 28,700 $ 28,416
Net Loan Charge-offs (Recoveries)
Commercial real estate $ 1,945 $ 1,420 $ 2,938 $ 3,550 $ 1,367
Commercial, industrial and other 35 258 258 (30) (201)
Leases 264 291 150 (210) 358
Home equity and consumer 289 334 528 617 1,355
Real estate - mortgage 329 921 160 345 1,154
Net charge-offs $ 2,862 $ 3,224 $ 4,034 $ 4,272 $ 4,033
Nonperforming Assets
Commercial real estate $ 14,542 $ 14,211 $ 18,843 $ 23,119 $ 28,971
Commercial, industrial and other 1,476 1,533 1,650 5,611 4,608
Leases 32 294 536 621 575
Home equity and consumer 3,197 3,104 2,818 2,725 3,252
Real estate - mortgage 8,733 9,235 10,197 9,943 11,610
Total non-accruing loans 27,980 28,377 34,044 42,019 49,016
Property acquired through foreclosure or repossession 529 775 1,250 1,314 1,182
Total non-performing assets $ 28,509 $ 29,152 $ 35,294 $ 43,333 $ 50,198
Loans past due 90 days or more $ 1,437 $ 1,828 $ 1,566 $ 2,343 $ 1,367
Loans restructured and still accruing $ 7,336 $ 10,937 $ 10,776 $ 8,744 $ 8,856
Ratio of allowance for loan and lease losses to total loans 1.35% 1.39% 1.37% 1.38% 1.39%
Non-performing loans to total loans 1.30% 1.37% 1.63% 2.03% 2.40%
Non-performing assets to total assets 0.98% 1.02% 1.24% 1.52% 1.78%
Annualized net charge-offs to average loans 0.54% 0.63% 0.78% 0.83% 0.80%
Lakeland Bancorp, Inc.
Supplemental Information - Non-GAAP Financial Measures
(unaudited)
At or for the Quarter Ended,
Dec 31, Sept 30, Jun 30, Mar 31, Dec 31,
(dollars in thousands, except per share amounts) 2012 2012 2012 2012 2011
Calculation of tangible book value per common share
Total common stockholders' equity at end of period - GAAP $ 280,867 $ 277,544 $ 246,941 $ 241,955 $ 241,303
Less:
Goodwill 87,111 87,111 87,111 87,111 87,111
Other identifiable intangible assets, net -- -- -- -- --
Total tangible common stockholders' equity at end of period - Non- GAAP $ 193,756 $ 190,433 $ 159,830 $ 154,844 $ 154,192
Shares outstanding at end of period (1) 29,726 29,691 26,993 26,963 26,836
Book value per share - GAAP (1) $ 9.45 $ 9.35 $ 9.15 $ 8.97 $ 8.99
Tangible book value per share - Non-GAAP (1) $ 6.52 $ 6.41 $ 5.92 $ 5.74 $ 5.75
Calculation of tangible common equity to tangible assets
Total tangible common stockholders' equity at end of period - Non- GAAP $ 193,756 $ 190,433 $ 159,830 $ 154,844 $ 154,192
Total assets at end of period $ 2,918,703 $ 2,859,647 $ 2,853,202 $ 2,852,347 $ 2,825,950
Less:
Goodwill 87,111 87,111 87,111 87,111 87,111
Other identifiable intangible assets, net -- -- -- -- --
Total tangible assets at end of period - Non-GAAP $ 2,831,592 $ 2,772,536 $ 2,766,091 $ 2,765,236 $ 2,738,839
Common equity to assets - GAAP 9.62% 9.71% 8.65% 8.48% 8.54%
Tangible common equity to tangible assets - Non-GAAP 6.84% 6.87% 5.78% 5.60% 5.63%
Calculation of return on average tangible common equity
Net income - GAAP $ 5,829 $ 5,489 $ 5,453 $ 4,971 $ 5,116
Total average common stockholders' equity 279,422 257,557 245,253 242,957 238,713
Less:
Average goodwill 87,111 87,111 87,111 87,111 87,111
Average other identifiable intangible assets, net -- -- -- -- --
Total average tangible common stockholders' equity - Non - GAAP $ 192,311 $ 170,446 $ 158,142 $ 155,846 $ 151,602
Return on average common stockholders' equity - GAAP 8.30% 8.48% 8.94% 8.23% 8.50%
Return on average tangible common stockholders' equity - Non-GAAP 12.06% 12.81% 13.87% 12.83% 13.39%
Calculation of efficiency ratio
Total non-interest expense $ 17,960 $ 16,968 $ 16,470 $ 16,275 $ 16,353
Less:
Amortization of core deposit intangibles -- -- -- -- --
Other real estate owned and other repossessed asset (expense) income (10) (13) (38) (38) 28
Long-term debt prepayment fee (782) -- -- -- --
Provision for unfunded lending commitments, net 124 (150) (122) 56 3
Non-interest expense, as adjusted $ 17,292 $ 16,805 $ 16,310 $ 16,293 $ 16,384
Net interest income $ 24,164 $ 23,655 $ 23,748 $ 23,946 $ 24,057
Noninterest income 5,437 4,640 4,771 4,057 4,082
Total revenue 29,601 28,295 28,519 28,003 28,139
Plus: Tax-equivalent adjustment on municipal securities 242 230 244 264 269
Less: (gains) on investment securities (776) -- (241) (32) --
Total revenue, as adjusted $ 29,067 $ 28,525 $ 28,522 $ 28,235 $ 28,408
Efficiency ratio - Non-GAAP 59.49% 58.91% 57.18% 57.71% 57.67%
(1) Adjusted for 5% stock dividend payable on April 16, 2012 to shareholders of record March 30, 2012.
Lakeland Bancorp, Inc.
Supplemental Information - Non-GAAP Financial Measures
(unaudited)
For the Year Ended,
December 31 December 31
(dollars in thousands, except per share amounts) 2012 2011
Calculation of return on average tangible common equity
Net income - GAAP $ 21,742 $ 19,851
Total average common stockholders' equity $ 256,364 $ 232,711
Less:
Average goodwill 87,111 87,111
Average other identifiable intangible assets, net -- 166
Total average tangible common stockholders' equity - Non GAAP $ 169,253 $ 145,434
Return on average common stockholders' equity - GAAP 8.48% 8.53%
Return on average tangible common stockholders' equity - Non-GAAP 12.85% 13.65%
Calculation of efficiency ratio
Total non-interest expense $ 67,673 $ 68,151
Less:
Amortization of core deposit intangibles -- (577)
Other real estate owned and other repossessed asset expense (99) (780)
Long-term debt prepayment fee (782) (800)
Provision for unfunded lending commitments (93) (375)
Non-interest expense, as adjusted $ 66,699 $ 65,619
Net interest income $ 95,513 $ 97,413
Noninterest income 18,905 18,117
Total revenue 114,418 115,530
Plus: Tax-equivalent adjustment on municipal securities 981 1,080
Less: gains on investment securities (1,049) (1,229)
Total revenue, as adjusted $ 114,350 $ 115,381
Efficiency ratio - Non - GAAP 58.33% 56.87%

CONTACT: Thomas J. Shara President & CEO Joseph F. Hurley EVP & CFO 973-697-2000Source:Lakeland Bancorp, Inc.