Bar Harbor Bankshares Reports Third Quarter 2023 Results; Declares Dividend
Bar Harbor Bankshares reported net income of $11.1 million in Q3 2023, compared to $11.4 million in Q3 2022. The company saw a 10% increase in non-interest bearing deposits and a 0.17% non-performing assets ratio to total assets. The Board of Directors declared a cash dividend of $0.28 per share. Total assets remained flat at $4.0 billion. The company's book value per share was $26.67 and tangible book value per share was $18.45. Net interest margin decreased to 3.18% from 3.47% in Q3 2022.
Positive
Bar Harbor Bankshares reported a solid quarter with a net income of $11.1 million, showing consistent long-term performance. Non-interest bearing deposits increased by 10%. The company declared a cash dividend of $0.28 per share, equating to a 4.74% annualized yield. Total assets remained flat at $4.0 billion. The company's book value per share increased to $26.67. Net interest margin decreased to 3.18%.
10/17/2023 - 04:28 PM
BAR HARBOR, ME / ACCESSWIRE / October 17, 2023 / Bar Harbor Bankshares (NYSE American:BHB) (the "Company") reported third quarter 2023 net income of $11.1 million or $0.73 per diluted share compared to $11.4 million or $0.76 per diluted share in the same quarter of 2022.
THIRD QUARTER 2023 HIGHLIGHTS (all comparisons to the third quarter 2022, unless otherwise noted)
1.11% return on assets, 10.72% return on equity10% annualized increase in non-interest bearing deposits4.90% yield on earning assets, compared to 3.84% 59% efficiency ratio, compared to 58% 0.17% non-performing assets ratio to total assetsBar Harbor Bankshares' President and Chief Executive Officer, Curtis C. Simard, stated, "We delivered another solid quarter, underscoring our commitment to generating consistent, sustainable long-term performance. Net interest income was $29.2 million , up from $28.8 million in the prior quarter as excess cash was used to pay down higher funding costs. Our net interest margin remains well above our peer group as we saw minimal compression of four basis points from the prior quarter. We continue to actively manage both sides of the balance sheet identifying the right risk-adjusted rate of return on earning assets, emphasizing selective growth in high-quality loan relationships and controlling deposit costs on an individual basis. Our retail strategy has proven to be successful as we continue to gain market share within our footprint, evidenced by both the opening of more than 1,700 new customer accounts and higher balances within most categories of non-maturity deposits. Our third quarter cumulative deposit beta for the current rate cycle is 27% , well below our direct competition in our footprint and the national average for our asset size."
Mr. Simard went on to say, "We continuously monitor and quarterly stress test our commercial loan portfolio, and our credit trends remain strong as expected. Non-performing assets remain at 17 basis points of total assets while net charge-offs to average loans remain at zero. We expanded the allowance for credit losses coverage ratio in the quarter by three basis points, primarily due to an increase in specific reserves on one non-accruing commercial loan, which is expected to be settled in the fourth quarter 2023. Our fee-based revenue remains a significant portion of total income and continues to be steady given both the diversity of sources and the significant size of assets under management in our wealth management business. Total assets under management remained flat at $2.3 billion despite the greater than 3% decline for the stock and bond markets in the quarter. We continue to diligently manage non-interest expenses which also contributed to maintaining our efficiency ratio this quarter despite the economic inflationary pressures."
Mr. Simard concluded, "As a company we have an ability to execute our business strategies even amid volatile quarters in the banking sector. Our commitment to delivering consistent total shareholder returns is steadfast as we've seen throughout 2023 thus far. Given the strength of our balance sheet and our teams, we remain well poised to weather any rate environment."
DIVIDEND DECLARED
The Company's Board of Directors voted to declare a cash dividend of $0.28 per share to shareholders of record at the close of business on November 16, 2023 payable on December 15, 2023. This dividend equates to a 4.74% annualized yield based on the $23.63 closing share price of the Company's common stock on September 29, 2023, the last trading day of the third quarter 2023.
FINANCIAL CONDITION (September 30, 2023 compared to June 30, 2023)
Total assets were $4.0 billion at the end of the third and second quarters of 2023, primarily due to relatively flat loan growth and lower security balances as interest rates continued to rise during the quarter.
Total loans were $3.0 billion at the end of both the third and second quarters 2023. Commercial and industrial ("C&I") loans increased $2.9 million comprised of $22.3 million of originations and $19.4 million of payoff activity. Commercial real estate loans decreased $2.9 million during the third quarter 2023, which included new originations of $19.5 million , draw-downs of $12.2 million and payoffs totaling $34.6 million . Residential loans decreased by $11.0 million compared to the second quarter 2023, due to lower demand for prevailing mortgage rates. Consumer loans dropped by $1.9 million from the second quarter 2023 due to run-off of balances associated with the repricing of home equity lines of credit.
Securities available for sale decreased to $509.5 million at the end of third quarter 2023, from $538.2 million in the second quarter 2023 as proceeds from amortization and prepayments were used to fund loans. The book yield from securities steadily increased over the past year primarily due to a repricing of variable rates, acceleration of discounts due to prepayments, and a run-off of lower coupon fixed-rate securities. Unrealized losses on securities totaled $86.5 million at the end of the third quarter 2023 versus $71.9 million at the end of the second quarter 2023 reflecting continued increases in market rates.
The allowance for credit losses ("ACL") was $28.0 million at the end of the third quarter 2023, compared to $27.4 million at the end of the second quarter 2023. The ratio of allowance for credit losses to total loans increased to 0.94% from 0.91% primarily due to an increase in specific reserves on one non-accrual C&I loan. While total non-accruing loans during the third quarter 2023 increased to $6.8 million from $6.7 million , we continue to see improvement in the commercial categories as we continue to work-out those loans.
Total deposits were $3.1 billion at the end of both the third and second quarters 2023, which improved the loan to deposit ratio to 95% from 97% , respectively. We opened 1,740 non-maturity accounts with new customers with an average balance of $12 thousand during the third quarter 2023. Demand and other non-interest bearing deposits, NOW and money market accounts increased $43.8 million largely driven by non-personal institutional inflows associated with seasonality during the third quarter of 2023. Savings deposits decreased $16.5 million evenly throughout the third quarter 2023 as personal accounts shifted into higher yielding certificate of deposit accounts ("CDs"). Brokered CDs decreased slightly by $778 thousand and totaled $201.9 million at the end of the third quarter 2023. Additionally, excess cash generated from operations was used to pay-down $91.9 million of Federal Home Loan Bank borrowings.
The Company's book value per share was $26.67 as of September 30, 2023, compared with $26.09 as of December 31, 2022. Unrealized losses on securities, net of taxes, reduced book value per share by $4.39 and $3.66 at the end of those respective periods. Tangible book value per share (non-GAAP measure) was $18.45 at the end of the third quarter 2023, compared to $17.78 at the end of the fourth quarter 2022.
RESULTS OF OPERATIONS (September 30, 2023 compared to September 30, 2022 quarterly comparison)
Net income in the third quarter 2023 was $11.1 million , or $0.73 per diluted share, versus $11.4 million , or $0.76 per diluted share, in the same quarter of 2022. Net interest income along with non-interest income and expense was relatively consistent in both periods. The benefit from a lower provision for loan credit losses was offset by a higher provision for income taxes due to one-time charges.
Net interest margin was 3.18% compared to 3.47% in the third quarter of 2022. The decrease was primarily driven by yield expansion on earning assets offset by a higher cost of funds. The yield on loans expanded to 5.11% in the third quarter 2023, up from 4.04% in the same quarter of 2022. Costs of interest-bearing liabilities increased to 2.19% from 0.48% in the third quarter 2022 as our costs continue to drift upwards from subsequent rate hikes. We also experienced a shift in deposit composition from non-maturity deposits to certificates of deposits, and had a heavier reliance on whole-sale borrowings in the third quarter 2023 as compared with the prior year quarter of 2022.
The provision for credit losses for the third quarter 2023 was $673 thousand , compared to $1.3 million in the same quarter of 2022. Current year quarter expense primarily reflects an increase in specific reserves on one loan, while expense in the prior year quarter was principally driven by outsized loan growth. We believe our overall credit performance continues to be strong and net charge-offs were near zero.
Non-interest income was $8.8 million in the third quarter 2023 and 2022. Customer service fees grew to $3.9 million during the third quarter 2023 from $3.8 million in the same quarter of 2022 on a higher number of transactional accounts. Wealth management income was $3.5 million in both periods as higher inflows of cash since 2022 were offset by lower security valuations in 2023.
Non-interest expense was $23.0 million in the third quarter 2023 and 2022. Salary and benefit expense was up 6% over the prior year quarter principally due to annual merit increases and lower expense deferral on decreased loan production. Other expense in the third quarter 2022 included one-time charges of $635 thousand related to the write-off of a few stale-dated reconciling items.
The effective tax rate in the third quarter 2023 was 22.4% , compared to 20.6% in the same quarter of 2022. One-time charges due to an audit settlement with the State of New Hampshire and 2022 return to provision adjustments totaled $268 thousand . Excluding one-time charges, our effective tax rate in the third quarter 2023 was consistent with the prior year quarter.
BACKGROUND
Bar Harbor Bankshares (NYSE American:BHB) is the parent company of its wholly-owned subsidiary, Bar Harbor Bank & Trust. Founded in 1887, Bar Harbor Bank & Trust is a true community bank serving the financial needs of its clients for over 135 years. Bar Harbor Bank & Trust provides full-service community banking with office locations in all three Northern New England states of Maine, New Hampshire and Vermont. For more information, visit www.barharbor.bank .
FORWARD-LOOKING STATEMENTS
All statements, other than statements of historical fact, included in this release that address activities, events or developments that the Company expects, believes or anticipates will or may occur in the future are "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The words "believe," "anticipate," "expect," "may," "will," "assume," "should," "predict," "could," "would," "intend," "targets," "estimates," "projects," "plans," and "potential," and other similar words and expressions of the future, are intended to identify such forward-looking statements, but other statements not based on historical information may also be considered forward-looking, including statements relating to Company's retail strategy, our credit trends, the timing of a settlement of a specified non-accrual commercial credit, our overall credit performance, and the Company's plans, objectives, and intentions. All forward-looking statements are subject to risks, uncertainties, and other factors that may cause the actual results, performance, or achievements of the Company to differ materially from any results, performance, or achievements expressed or implied by such forward-looking statements. These forward-looking statements are subject to known and unknown risks, uncertainties and other factors that could cause the actual results to differ materially from the statements, including, but not limited to: (1) deterioration in the financial performance and/or condition of borrowers of Bar Harbor Bank & Trust (the "Bank"), including as a result of the negative impact of inflationary pressures on our customers and their businesses resulting in significant increases in credit losses and provisions for those losses; (2) the possibility that our asset quality could decline or that we experience greater loan losses than anticipated; (3) increased levels of other real estate owned, primarily as a result of foreclosures; (4) the impact of liquidity needs on our results of operations and financial condition; (5) competition from financial institutions and other financial service providers; (6) the effect of interest rate increases on the cost of deposits; (7) unanticipated weakness in loan demand or loan pricing; (8) adverse conditions in the national or local economies including in our markets throughout Northern New England; (9) changes in consumer spending, borrowing and saving habits; (10) the effects of new outbreaks of COVID-19, including actions taken by governmental officials to curb the spread of the virus, and the resulting impact on general economic and financial market conditions and on the Company's and our customers' business, results of operations, asset quality and financial condition; (11) the effects of civil unrest, international hostilities or other geopolitical events, including the war in Ukraine and recent hostilities in the Middle East; (12) inflation, interest rate, market, and monetary fluctuations; (13) lack of strategic growth opportunities or our failure to execute on available opportunities; (14) the ability to grow and retain low-cost core deposits and retain large, uninsured deposits; (15) our ability to effectively manage problem credits; (16) our ability to successfully implement efficiency initiatives on time and with the results projected; (17) our ability to successfully develop and market new products and technology; (18) the impact of negative developments in the financial industry and United States and global capital and credit markets; (19) our ability to retain executive officers and key employees and their customer and community relationships; (20) our ability to adapt to technological changes; (21) risks associated with litigation, including reputational and financial risks and the applicability of insurance coverage; (22) our ability to implement new technology effectively; (23) the vulnerability of the Bank's computer and information technology systems and networks, and the systems and networks of third parties with whom the Company or the Bank contract, to unauthorized access, computer viruses, phishing schemes, spam attacks, human error, natural disasters, power loss, and other security breaches and interruptions; (24) changes in the reliability of our vendors, internal control systems or information systems; (25) ongoing competition in the labor markets and increased employee turnover; (26) the potential impact of climate change; (27) the impact of pandemics, epidemics or any other health-related crisis; (28) our ability to comply with various governmental and regulatory requirements applicable to financial institutions; (29) changes in state and federal laws, rules, regulations, or policies applicable to banks or bank or financial holding companies, including regulatory or legislative developments; (30) the effects of and changes in trade and monetary and fiscal policies and laws, including the interest rate policies of the Board of Governors of the Federal Reserve System; (31) adverse impacts (including costs, fines, reputational harm, or other negative effects) from current or future litigation, regulatory examinations, or other legal and/or regulatory actions; and (32) general competitive, economic, political, and market conditions, including economic conditions in the local markets where we operate. Additional factors which could affect the forward-looking statements can be found in the Company's annual report on Form 10-K, quarterly reports on Form 10-Q, and current reports on Form 8-K filed with the Securities and Exchange Commission (the "SEC") and available on the SEC's website at http://www.sec.gov. The Company believes the forward-looking statements contained herein are reasonable; however, many of such risks, uncertainties, and other factors are beyond the Company's ability to control or predict and undue reliance should not be placed on any forward-looking statements, which are based on current expectations and speak only as of the date that they are made. Therefore, the Company can give no assurance that its future results will be as estimated. The Company does not intend to, and disclaims any obligation to, update or revise any forward-looking statement.
NON-GAAP FINANCIAL MEASURES
This document contains certain non-GAAP financial measures in addition to results presented in accordance with accounting principles generally accepted in the United States of America ("GAAP"). These non-GAAP measures are intended to provide the reader with additional supplemental perspectives on operating results, performance trends, and financial condition. Non-GAAP financial measures are not a substitute for GAAP measures; they should be read and used in conjunction with the Company's GAAP financial information. Because non-GAAP financial measures presented in this document are not measurements determined in accordance with GAAP and are susceptible to varying calculations, these non-GAAP financial measures, as presented, may not be comparable to other similarly titled measures presented by other companies. A reconciliation of non-GAAP financial measures to GAAP measures is provided below. In all cases, it should be understood that non-GAAP measures do not depict amounts that accrue directly to the benefit of shareholders. An item which management excludes when computing non-GAAP core earnings can be of substantial importance to the Company's results for any particular quarter or year. The Company's non-GAAP core earnings information set forth is not necessarily comparable to non-GAAP information, which may be presented by other companies. Each non-GAAP measure used by the Company in this report as supplemental financial data should be considered in conjunction with the Company's GAAP financial information.
The Company utilizes the non-GAAP measure of core earnings in evaluating operating trends, including components for core revenue and expense. These measures exclude amounts which the Company views as unrelated to its normalized operations, including gains/losses on securities, premises, equipment and other real estate owned, acquisition costs, restructuring costs, legal settlements, and systems conversion costs. Non-GAAP adjustments are presented net of an adjustment for income tax expense.
The Company also calculates core earnings per share based on its measure of core earnings. The Company views these amounts as important to understanding its operating trends, particularly due to the impact of accounting standards related to acquisition activity. Analysts also rely on these measures in estimating and evaluating the Company's performance. Management also believes that the computation of non-GAAP core earnings and core earnings per share may facilitate the comparison of the Company to other companies in the financial services industry. The Company also adjusts certain equity related measures to exclude intangible assets due to the importance of these measures to the investment community.
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CONTACTS
Josephine Iannelli; EVP, Chief Financial Officer & Treasurer; (207) 288-3314
TABLE INDEX CONSOLIDATED FINANCIAL SCHEDULES (UNAUDITED) A Selected Financial Highlights B Balance Sheets C Loan and Deposit Analysis D Statements of Income E Statements of Income (Five Quarter Trend) F Average Yields and Costs G Average Balances H Asset Quality Analysis I-J Reconciliation of Non-GAAP Financial Measures (Five Quarter Trend) and Supplementary Data
BAR HARBOR BANKSHARES SELECTED FINANCIAL HIGHLIGHTS - UNAUDITED
At or for the Quarters Ended
Sep 30, Jun 30, Mar 31, Dec 31, Sep 30,
2023 2023 2023 2022 2022 PER SHARE DATA Net earnings, diluted
$ 0.73 $ 0.71 $ 0.86 $ 0.83 $ 0.76 Core earnings, diluted (1)
0.73 0.71 0.86 0.83 0.76 Total book value
26.67 27.12 27.00 26.09 25.22 Tangible book value (1)
18.45 18.88 18.74 17.78 16.89 Market price at period end
23.63 24.64 26.45 32.04 26.52 Dividends
0.28 0.28 0.26 0.26 0.26 PERFORMANCE RATIOS (2) Return on assets
1.11 % 1.10 % 1.36 % 1.30 % 1.20 % Core return on assets (1)
1.11 1.09 1.36 1.30 1.20 Pre-tax, pre-provision return on assets
1.49 1.47 1.81 1.72 1.65 Core pre-tax, pre-provision return on assets (1)
1.49 1.46 1.81 1.72 1.65 Return on equity
10.72 10.49 12.96 12.73 11.55 Core return on equity (1)
10.72 10.42 12.94 12.72 11.54 Return on tangible equity
15.65 15.28 18.97 19.03 17.25 Core return on tangible equity (1)
15.65 15.19 18.94 19.02 17.24 Net interest margin, fully taxable equivalent (1) (3)
3.18 3.22 3.54 3.76 3.47 Efficiency ratio (1)
58.59 60.25 54.72 58.19 57.67 FINANCIAL DATA (In millions) Total assets
$ 3,984 $ 4,029 $ 3,928 $ 3,910 $ 3,840 Total earning assets (4)
3,687 3,716 3,628 3,601 3,525 Total investments
524 556 573 574 566 Total loans
2,993 3,007 2,944 2,903 2,850 Allowance for credit losses
28 27 27 26 25 Total goodwill and intangible assets
125 125 125 125 126 Total deposits
3,140 3,090 3,054 3,043 3,136 Total shareholders' equity
404 411 408 393 380 Net income
11 11 13 13 11 Core earnings (1)
11 11 13 13 11 ASSET QUALITY AND CONDITION RATIOS Net charge-offs (recoveries) (5) /average loans
- % - % 0.01 % (0.02) % 0.01 % Allowance for credit losses/total loans
0.94 0.91 0.90 0.89 0.88 Loans/deposits
95 97 96 95 91 Shareholders' equity to total assets
10.15 10.20 10.40 10.06 9.89 Tangible shareholders' equity to tangible assets
7.25 7.32 7.45 7.09 6.85
Non-GAAP financial measure. Refer to the Reconciliation of Non-GAAP Financial Measures in tables I-J for additional information. All performance ratios are based on average balance sheet amounts, where applicable. Fully taxable equivalent considers the impact of tax-advantaged investment securities and loans. Earning assets includes non-accruing loans and interest-bearing deposits with other banks. Securities are valued at amortized cost. Current quarter annualized. BAR HARBOR BANKSHARES CONSOLIDATED BALANCE SHEETS - UNAUDITED
Sep 30, Jun 30, Mar 31, Dec 31, Sep 30, (in thousands)
2023 2023 2023 2022 2022 Assets
Cash and due from banks
$ 41,210 $ 46,532 $ 37,769 $ 39,933 $ 50,760 Interest-earning deposits with other banks
81,606 77,253 44,933 52,362 31,305 Total cash and cash equivalents
122,816 123,785 82,702 92,295 82,065
Securities available for sale
509,453 538,178 557,040 559,516 556,752 Federal Home Loan Bank stock
14,834 17,784 15,718 14,893 9,035 Total securities
524,287 555,962 572,758 574,409 565,787
Loans held for sale
2,016 3,669 463 - 982
Total loans
2,992,791 3,007,480 2,944,005 2,902,690 2,850,364 Less: Allowance for credit losses
(28,011 ) (27,362 ) (26,607 ) (25,860 ) (25,018 ) Net loans
2,964,780 2,980,118 2,917,398 2,876,830 2,825,346
Premises and equipment, net
47,790 47,412 47,549 47,622 48,010 Other real estate owned
- - - - - Goodwill
119,477 119,477 119,477 119,477 119,477 Other intangible assets
5,102 5,335 5,568 5,801 6,034 Cash surrender value of bank-owned life insurance
79,469 78,967 78,436 81,197 80,758 Deferred tax asset, net
28,328 24,181 22,858 24,443 25,288 Other assets
89,876 89,641 81,269 87,729 86,499 Total assets
$ 3,983,941 $ 4,028,547 $ 3,928,478 $ 3,909,803 $ 3,840,246
Liabilities and shareholders' equity
Demand and other non-interest bearing deposits
$ 618,421 $ 602,667 $ 636,710 $ 676,350 $ 700,218 NOW deposits
929,481 911,488 908,483 900,730 918,822 Savings deposits
572,271 588,769 628,798 664,514 669,317 Money market deposits
361,839 351,762 475,577 478,398 513,075 Time deposits
658,482 635,559 404,246 323,439 334,248 Total deposits
3,140,494 3,090,245 3,053,814 3,043,431 3,135,680
Senior borrowings
307,070 398,972 338,244 333,957 188,757 Subordinated borrowings
60,422 60,371 60,330 60,289 60,248 Total borrowings
367,492 459,343 398,574 394,246 249,005
Other liabilities
71,747 68,243 67,680 78,676 75,596 Total liabilities
3,579,733 3,617,831 3,520,068 3,516,353 3,460,281
Total shareholders' equity
404,208 410,716 408,410 393,450 379,965 Total liabilities and shareholders' equity
$ 3,983,941 $ 4,028,547 $ 3,928,478 $ 3,909,803 $ 3,840,246
Net shares outstanding
15,156 15,144 15,124 15,083 15,066
BAR HARBOR BANKSHARES CONSOLIDATED LOAN & DEPOSIT ANALYSIS - UNAUDITED
LOAN ANALYSIS
Annualized
Growth %
Sep 30, Jun 30, Mar 31, Dec 31, Sep 30, Quarter Year (in thousands)
2023 2023 2023 2022 2022 to Date to Date Commercial real estate
$ 1,548,835 $ 1,551,748 $ 1,519,219 $ 1,495,452 $ 1,421,962 (1) % 5 % Commercial and industrial
391,347 388,430 364,315 352,735 376,624 3 15 Total commercial loans
1,940,182 1,940,178 1,883,534 1,848,187 1,798,586 - 7
Residential real estate
896,757 907,741 906,059 898,192 896,618 (5) - Consumer
95,160 96,947 98,616 100,855 100,822 (7) (8 ) Tax exempt and other
60,692 62,614 55,796 55,456 54,338 (12) 13 Total loans
$ 2,992,791 $ 3,007,480 $ 2,944,005 $ 2,902,690 $ 2,850,364 (2) % 4 %
DEPOSIT ANALYSIS
Annualized
Growth %
Sep 30, Jun 30, Mar 31, Dec 31, Sep 30, Quarter Year (in thousands)
2023 2023 2023 2022 2022 to Date to Date Demand
$ 618,421 $ 602,667 $ 636,710 $ 676,350 $ 700,218 10 % (11) % NOW
929,481 911,488 908,483 900,730 918,822 8 4 Savings
572,271 588,769 628,798 664,514 669,317 (11 ) (19 ) Money market
361,839 351,762 475,577 478,398 513,075 11 (33 ) Total non-maturity deposits
2,482,012 2,454,686 2,649,568 2,719,992 2,801,432 4 (12 ) Total time deposits
658,482 635,559 404,246 323,439 334,248 14 * Total deposits
$ 3,140,494 $ 3,090,245 $ 3,053,814 $ 3,043,431 $ 3,135,680 7 % 4 %
*Indicates ratio greater than 100%
BAR HARBOR BANKSHARES CONSOLIDATED STATEMENTS OF INCOME - UNAUDITED
Three Months Ended Nine Months Ended
September 30, September 30, (in thousands, except per share data)
2023 2022 2023 2022 Interest and dividend income
Loans
$ 38,412 $ 27,940 $ 109,889 $ 75,192 Securities and other
6,723 5,145 18,478 13,178 Total interest and dividend income
45,135 33,085 128,367 88,370 Interest expense
Deposits
11,415 1,801 25,270 4,185 Borrowings
4,534 1,374 14,215 3,458 Total interest expense
15,949 3,175 39,485 7,643 Net interest income
29,186 29,910 88,882 80,727 Provision for credit losses
673 1,306 2,221 2,217 Net interest income after provision for credit losses
28,513 28,604 86,661 78,510 Non-interest income
Trust and investment management fee income
3,522 3,548 10,882 11,131 Customer service fees
3,926 3,836 11,377 11,108 Gain on sales of securities, net
- 44 34 53 Mortgage banking income
415 315 1,072 1,427 Bank-owned life insurance income
515 496 2,166 1,501 Customer derivative income
43 58 258 213 Other income
394 526 1,190 1,660 Total non-interest income
8,815 8,823 26,979 27,093 Non-interest expense
Salaries and employee benefits
13,011 12,242 39,005 35,757 Occupancy and equipment
4,469 4,458 13,275 13,254 Gain on sales of premises and equipment, net
- - (99 ) (65 ) Outside services
376 393 1,156 1,143 Professional services
436 421 1,217 1,122 Communication
170 204 507 617 Marketing
326 518 1,211 1,150 Amortization of intangible assets
233 233 699 699 Acquisition, conversion and other expenses
- 31 20 356 Provision for unfunded commitments
45 (26 ) (85 ) 345 Other expenses
3,950 4,558 12,206 12,240 Total non-interest expense
23,016 23,032 69,112 66,618 Income before income taxes
14,312 14,395 44,528 38,985 Income tax expense
3,208 2,965 9,621 7,940 Net income
$ 11,104 $ 11,430 $ 34,907 $ 31,045
Earnings per share:
Basic
$ 0.73 $ 0.76 $ 2.31 $ 2.07 Diluted
0.73 0.76 2.30 2.06
Weighted average shares outstanding:
Basic
15,155 15,058 15,135 15,029 Diluted
15,196 15,113 15,189 15,100
BAR HARBOR BANKSHARES CONSOLIDATED STATEMENTS OF INCOME (5 Quarter Trend) - UNAUDITED
Sep 30, Jun 30, Mar 31, Dec 31, Sep 30, (in thousands, except per share data)
2023 2023 2023 2022 2022 Interest and dividend income
Loans
$ 38,412 $ 36,917 $ 34,560 $ 32,605 $ 27,940 Securities and other
6,723 5,964 5,791 5,551 5,145 Total interest and dividend income
45,135 42,881 40,351 38,156 33,085 Interest expense
Deposits
11,415 8,590 5,265 3,159 1,801 Borrowings
4,534 5,501 4,180 2,043 1,374 Total interest expense
15,949 14,091 9,445 5,202 3,175 Net interest income
29,186 28,790 30,906 32,954 29,910 Provision for credit losses
673 750 798 687 1,306 Net interest income after provision for credit losses
28,513 28,040 30,108 32,267 28,604 Non-interest income
Trust and investment management fee income
3,522 3,805 3,555 3,442 3,548 Customer service fees
3,926 3,774 3,677 3,683 3,836 Gain on sales of securities, net
- - 34 - 44 Mortgage banking income
415 378 279 153 315 Bank-owned life insurance income
515 503 1,148 499 496 Customer derivative income
43 83 132 97 58 Other income
394 437 359 354 526 Total non-interest income
8,815 8,980 9,184 8,228 8,823 Non-interest expense
Salaries and employee benefits
13,011 13,223 12,771 12,900 12,242 Occupancy and equipment
4,469 4,392 4,414 4,321 4,458 (Gain) loss on sales of premises and equipment, net
- (86 ) (13 ) 75 - Outside services
376 424 356 435 393 Professional services
436 355 426 490 421 Communication
170 175 162 263 204 Marketing
326 476 409 411 518 Amortization of intangible assets
233 233 233 233 233 Acquisition, conversion and other expenses
- - 20 (90 ) 31 Provision for unfunded commitments
45 45 (175 ) 1,413 (26 ) Other expenses
3,950 4,155 4,101 4,184 4,558 Total non-interest expense
23,016 23,392 22,704 24,635 23,032 Income before income taxes
14,312 13,628 16,588 15,860 14,395 Income tax expense
3,208 2,837 3,576 3,348 2,965 Net income
$ 11,104 $ 10,791 $ 13,012 $ 12,512 $ 11,430
Earnings per share:
Basic
$ 0.73 $ 0.71 $ 0.86 $ 0.83 $ 0.76 Diluted
0.73 0.71 0.86 0.83 0.76
Weighted average shares outstanding:
Basic
15,155 15,139 15,110 15,073 15,058 Diluted
15,196 15,180 15,190 15,147 15,113
BAR HARBOR BANKSHARES AVERAGE YIELDS AND COSTS (Fully Taxable Equivalent (Non-GAAP) - Annualized) - UNAUDITED
Quarters Ended
Sep 30, Jun 30, Mar 31, Dec 31, Sep 30,
2023 2023 2023 2022 2022 Earning assets
Interest-earning deposits with other banks
5.02 % 5.59 % 4.28 % 4.00 % 2.13 % Securities available for sale and FHLB stock
3.87 3.71 3.66 3.40 3.12 Loans:
Commercial real estate
5.34 5.21 5.08 4.81 4.26 Commercial and industrial
6.56 6.42 5.89 5.43 4.46 Residential real estate
3.84 3.76 3.71 3.63 3.45 Consumer
6.88 6.67 6.37 5.79 4.55 Total loans
5.11 4.99 4.82 4.56 4.04 Total earning assets
4.90 % 4.77 % 4.61 % 4.35 % 3.84 %
Funding liabilities
Deposits:
NOW
1.11 % 0.94 % 0.51 % 0.22 % 0.16 % Savings
0.42 0.37 0.30 0.16 0.08 Money market
2.55 2.52 2.14 1.42 0.65 Time deposits
3.65 2.82 1.34 0.69 0.55 Total interest-bearing deposits
1.81 1.45 0.91 0.52 0.30 Borrowings
4.59 4.73 4.25 3.23 2.69 Total interest-bearing liabilities
2.19 % 1.99 % 1.39 % 0.78 % 0.48 %
Net interest spread
2.71 2.78 3.22 3.57 3.36 Net interest margin, fully taxable equivalent (1)
3.18 3.22 3.54 3.76 3.47
(1) Non-GAAP financial measure. Refer to the Reconciliation of Non-GAAP Financial Measures in tables I-J for additional information.
BAR HARBOR BANKSHARES AVERAGE BALANCES - UNAUDITED
Quarters Ended
Sep 30, Jun 30, Mar 31, Dec 31, Sep 30, (in thousands)
2023 2023 2023 2022 2022 Assets
Interest-earning deposits with other banks (1)
$ 70,499 $ 21,440 $ 19,819 $ 26,360 $ 59,556 Securities available for sale and FHLB stock (2)
620,851 636,088 643,523 641,787 642,475 Loans:
Commercial real estate
1,550,188 1,536,035 1,505,681 1,447,384 1,351,599 Commercial and industrial
439,915 434,384 413,921 403,304 422,057 Residential real estate
909,296 911,788 902,348 897,637 882,158 Consumer
96,362 97,518 100,124 100,182 101,175 Total loans (3)
2,995,761 2,979,725 2,922,074 2,848,507 2,756,989 Total earning assets
3,687,111 3,637,253 3,585,416 3,516,654 3,459,020 Cash and due from banks
36,713 32,067 31,556 36,891 40,330 Allowance for credit losses
(27,473 ) (26,932 ) (25,971 ) (25,497 ) (24,061 ) Goodwill and other intangible assets
124,926 124,926 125,158 125,391 125,626 Other assets
162,801 163,388 168,773 164,749 171,394 Total assets
$ 3,984,078 $ 3,930,702 $ 3,884,932 $ 3,818,188 $ 3,772,309
Liabilities and shareholders' equity
Deposits:
NOW
$ 915,072 $ 885,091 $ 883,134 $ 899,388 $ 905,668 Savings
579,090 602,724 646,291 664,016 668,255 Money market
358,742 423,013 481,951 501,564 491,683 Time deposits
645,285 468,188 342,994 334,297 349,787 Total interest-bearing deposits
2,498,189 2,379,016 2,354,370 2,399,265 2,415,393 Borrowings
391,976 466,402 398,837 251,263 202,296 Total interest-bearing liabilities
2,890,165 2,845,418 2,753,207 2,650,528 2,617,689 Non-interest-bearing demand deposits
610,644 608,180 651,885 703,471 690,134 Other liabilities
72,409 64,346 72,693 74,276 71,934 Total liabilities
3,573,218 3,517,944 3,477,785 3,428,275 3,379,757 Total shareholders' equity
410,860 412,758 407,147 389,913 392,552 Total liabilities and shareholders' equity
$ 3,984,078 $ 3,930,702 $ 3,884,932 $ 3,818,188 $ 3,772,309
(1) Total average interest-bearing deposits with other banks is net of Federal Reserve daily cash letter.
BAR HARBOR BANKSHARES ASSET QUALITY ANALYSIS - UNAUDITED
At or for the Quarters Ended Sep 30, Jun 30, Mar 31, Dec 31, Sep 30, (in thousands)
2023 2023 2023 2022 2022 NON-PERFORMING ASSETS
Non-accruing loans:
Commercial real estate
$ 867 $ 909 $ 1,163 $ 1,222 $ 1,587 Commercial and industrial
1,595 1,814 1,917 264 348 Residential real estate
3,673 3,415 3,830 4,151 4,858 Consumer
635 565 886 911 981 Total non-accruing loans
6,770 6,703 7,796 6,548 7,774 Other real estate owned
- - - - - Total non-performing assets
$ 6,770 $ 6,703 $ 7,796 $ 6,548 $ 7,774
Total non-accruing loans/total loans
0.23 % 0.22 % 0.26 % 0.23 % 0.27 % Total non-performing assets/total assets
0.17 0.17 0.20 0.17 0.20
PROVISION AND ALLOWANCE FOR CREDIT LOSSES
Balance at beginning of period
$ 27,362 $ 26,607 $ 25,860 $ 25,018 $ 23,756 Charged-off loans
(74 ) (199 ) (68 ) (136 ) (85 ) Recoveries on charged-off loans
50 204 17 291 41 Net loans (charged-off) recovered
(24 ) 5 (51 ) 155 (44 ) Provision for credit losses
673 750 798 687 1,306 Balance at end of period
$ 28,011 $ 27,362 $ 26,607 $ 25,860 $ 25,018
Allowance for credit losses/total loans
0.94 % 0.91 % 0.90 % 0.89 % 0.88 % Allowance for credit losses/non-accruing loans
414 408 341 395 322
NET LOAN (CHARGE-OFFS) RECOVERIES
Commercial real estate
$ - $ (72 ) $ 3 $ - $ 7 Commercial and industrial
34 139 2 285 12 Residential real estate
13 3 4 (56 ) (5 ) Consumer
(71 ) (65 ) (60 ) (74 ) (58 ) Total, net
$ (24 ) $ 5 $ (51 ) $ 155 $ (44 )
Net (recoveries) charge-offs (QTD annualized)/average loans
- % - % 0.01 % (0.02) % 0.01 % Net (recoveries) charge-offs (YTD annualized)/average loans
0.01 - 0.01 (0.01 ) -
DELINQUENT AND NON-ACCRUING LOANS/ TOTAL LOANS
30-89 Days delinquent
0.13 % 0.09 % 0.26 % 0.08 % 0.09 % 90+ Days delinquent and still accruing
0.03 0.02 - 0.01 0.01 Total accruing delinquent loans
0.16 0.11 0.26 0.09 0.10 Non-accruing loans
0.23 0.22 0.26 0.23 0.27 Total delinquent and non-accruing loans
0.39 % 0.33 % 0.52 % 0.32 % 0.37 %
BAR HARBOR BANKSHARES RECONCILIATION OF NON-GAAP FINANCIAL MEASURES AND SUPPLEMENTARY DATA - UNAUDITED
At or for the Quarters Ended
Sep 30, Jun 30, Mar 31, Dec 31, Sep 30, (in thousands)
2023 2023 2023 2022 2022 Net income
$ 11,104 $ 10,791 $ 13,012 $ 12,512 $ 11,430 Non-core items:
Gain on sale of securities, net
- - (34 ) - (44 ) (Gain) loss on sale of premises and equipment, net
- (86 ) (13 ) 75 - Acquisition, conversion and other expenses
- - 20 (90 ) 31 Income tax expense (1)
- 20 6 4 3 Total non-core items
- (66 ) (21 ) (11 ) (10 ) Core earnings (2)
(A) $ 11,104 $ 10,725 $ 12,991 $ 12,501 $ 11,420
Net interest income
(B) $ 29,186 $ 28,790 $ 30,906 $ 32,954 $ 29,910 Non-interest income
8,815 8,980 9,184 8,228 8,823 Total revenue
38,001 37,770 40,090 41,182 38,733 Gain on sale of securities, net
- - (34 ) - (44 ) Total core revenue (2)
(C) $ 38,001 $ 37,770 $ 40,056 $ 41,182 $ 38,689
Total non-interest expense
23,016 23,392 22,704 24,635 23,032 Non-core expenses:
Gain (loss) on sale of premises and equipment, net
- 86 13 (75 ) - Acquisition, conversion and other expenses
- - (20 ) 90 (31 ) Total non-core expenses
- 86 (7 ) 15 (31 ) Core non-interest expense (2)
(D) $ 23,016 $ 23,478 $ 22,697 $ 24,650 $ 23,001
Total revenue
38,001 37,770 40,090 41,182 38,733 Total non-interest expense
23,016 23,392 22,704 24,635 23,032 Pre-tax, pre-provision net revenue
$ 14,985 $ 14,378 $ 17,386 $ 16,547 $ 15,701
Core revenue(2)
38,001 37,770 40,056 41,182 38,689 Core non-interest expense(2)
23,016 23,478 22,697 24,650 23,001 Core pre-tax, pre-provision net revenue(2)
(U) $ 14,985 $ 14,292 $ 17,359 $ 16,532 $ 15,688
(in millions)
Average earning assets
(E) $ 3,687 $ 3,637 $ 3,585 $ 3,517 $ 3,459 Average assets
(F) 3,984 3,931 3,885 3,818 3,772 Average shareholders' equity
(G) 411 413 407 390 393 Average tangible shareholders' equity (2) (3)
(H) 286 288 282 265 267 Tangible shareholders' equity, period-end (2) (3)
(I) 280 286 283 268 254 Tangible assets, period-end (2) (3)
(J) 3,859 3,904 3,803 3,785 3,715
BAR HARBOR BANKSHARES RECONCILIATION OF NON-GAAP FINANCIAL MEASURES AND SUPPLEMENTARY DATA - UNAUDITED
At or for the Quarters Ended Sep 30, Jun 30, Mar 31, Dec 31, Sep 30, (in thousands)
2023 2023 2023 2022 2022 Common shares outstanding, period-end
(K) 15,156 15,144 15,124 15,083 15,066 Average diluted shares outstanding
(L) 15,196 15,180 15,190 15,147 15,113
Core earnings per share, diluted (2)
(A/L) $ 0.73 $ 0.71 $ 0.86 $ 0.83 $ 0.76 Tangible book value per share, period-end (2)
(I/K) 18.45 18.88 18.74 17.78 16.89 Securities adjustment, net of tax (1) (4)
(M) (66,530 ) (55,307 ) (50,646 ) (55,246 ) (58,715 ) Tangible book value per share, excluding securities adjustment (2) (4)
(I+M)/K 22.84 22.53 22.08 21.44 20.79 Tangible shareholders' equity/total tangible assets (2)
(I/J) 7.25 7.32 7.45 7.09 6.85
Performance ratios (5)
GAAP return on assets
1.11 % 1.10 % 1.36 % 1.30 % 1.20 % Core return on assets (2)
(A/F) 1.11 1.09 1.36 1.30 1.20 Pre-tax, pre-provision return on assets
1.49 1.47 1.81 1.72 1.65 Core pre-tax, pre-provision return on assets (2)
(U/F) 1.49 1.46 1.81 1.72 1.65 GAAP return on equity
10.72 10.49 12.96 12.73 11.55 Core return on equity (2)
(A/G) 10.72 10.42 12.94 12.72 11.54 Return on tangible equity
15.65 15.28 18.97 19.03 17.25 Core return on tangible equity (1) (2)
(A+Q)/H 15.65 15.19 18.94 19.02 17.24 Efficiency ratio (2) (6)
(D-O-Q)/(C+N) 58.59 60.25 54.72 58.19 57.67 Net interest margin, fully taxable equivalent (2)
(B+P)/E 3.18 3.22 3.54 3.76 3.47
Supplementary data (in thousands)
Taxable equivalent adjustment for efficiency ratio
(N) $ 565 $ 539 $ 727 $ 520 $ 533 Franchise taxes included in non-interest expense
(O) 186 163 148 149 149 Tax equivalent adjustment for net interest margin
(P) 405 382 368 365 379 Intangible amortization
(Q) 233 233 233 233 233
(1) Assumes a marginal tax rate of 23.80% in the first three quarters of 2023, 23.53% in the fourth quarter of 2022 and 23.41% for the previous quarters.
SOURCE: Bar Harbor Bank and Trust
https://www.accesswire.com/793682/bar-harbor-bankshares-reports-third-quarter-2023-results-declares-dividend
What was Bar Harbor Bankshares' net income in Q3 2023?
Bar Harbor Bankshares reported a net income of $11.1 million in Q3 2023.
What was the increase in non-interest bearing deposits?
Non-interest bearing deposits increased by 10%.
What was the dividend declared by the Board of Directors?
The Board of Directors declared a cash dividend of $0.28 per share.
What was the total assets of Bar Harbor Bankshares?
Total assets remained flat at $4.0 billion.
What was the net interest margin in Q3 2023?
The net interest margin decreased to 3.18% from 3.47% in Q3 2022.
