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Brookline Bancorp Announces Fourth Quarter Results

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Net Income of $29.7 million, EPS of $0.39

BOSTON, Jan. 25, 2023 (GLOBE NEWSWIRE) -- Brookline Bancorp, Inc. (NASDAQ: BRKL) (the “Company”) today announced net income of $29.7 million, or $0.39 per basic and diluted share, for the fourth quarter of 2022, compared to $30.1 million, or $0.39 per basic and diluted share, for the third quarter of 2022, and $28.5 million, or $0.37 per basic and diluted share, for the fourth quarter of 2021.

For the year ended December 31, 2022, the Company reported net income of $109.7 million, or $1.42 per basic and diluted share. This compared to $115.4 million, or $1.48 per basic and diluted share, for the year ended December 31, 2021.

Paul Perrault, Chairman and Chief Executive Officer, commented on the Company’s performance, “Brookline Bancorp had an excellent year in 2022. We again finished the year with exceptional loan growth and are well positioned as we look forward to 2023. We are pleased to welcome PCSB Bank to our family of banks and look forward to their contributions to our Company in the years to come. I would like to recognize the continued contributions of our colleagues to our Company in 2022."

BALANCE SHEET

Total assets at December 31, 2022 increased $526.8 million to $9.2 billion from $8.7 billion at September 30, 2022, and increased $619.9 million from $8.6 billion at December 31, 2021.

At December 31, 2022, total loans and leases were $7.6 billion, representing an increase of $223.1 million from September 30, 2022, and an increase of $489.9 million from December 31, 2021. The loan portfolio grew $223.1 million in the fourth quarter compared to growth of $129.4 million in the third quarter.

Total investment securities at December 31, 2022 decreased $18.9 million to $656.8 million from $675.7 million at September 30, 2022, and decreased $64.1 million from $720.9 million at December 31, 2021. Total cash and cash equivalents at December 31, 2022 increased $270.5 million to $383.0 million from $112.5 million at September 30, 2022, and increased $55.3 million from $327.7 million at December 31, 2021. As of December 31, 2022, total investment securities and total cash and cash equivalents represented 11.3 percent of total assets as compared to 9.1 percent and 12.2 percent as of September 30, 2022 and December 31, 2021, respectively.

Total deposits at December 31, 2022 decreased $213.5 million to $6.5 billion from $6.7 billion at September 30, 2022 and decreased $527.8 million from $7.0 billion at December 31, 2021.

Total borrowed funds at December 31, 2022 increased $673.9 million to $1.4 billion from $0.8 billion at September 30, 2022 and increased $1.0 billion from $0.4 billion at December 31, 2021.

The ratio of stockholders’ equity to total assets was 10.76 percent at December 31, 2022, as compared to 11.08 percent at September 30, 2022, and 11.57 percent at December 31, 2021. The ratio of tangible stockholders’ equity to tangible assets (non-GAAP) was 9.16 percent at December 31, 2022, as compared to 9.39 percent at September 30, 2022, and 9.87 percent at December 31, 2021. Tangible book value per common share (non-GAAP) increased $0.37 from $10.43 at September 30, 2022 to $10.80 at December 31, 2022, compared to $10.73 at December 31, 2021.

NET INTEREST INCOME

Net interest income increased $2.0 million to $80.0 million during the fourth quarter of 2022 from $78.0 million for the quarter ended September 30, 2022. The net interest margin increased 1 basis point to 3.81 percent for the three months ended December 31, 2022 from 3.80 percent for the three months ended September 30, 2022.

NON-INTEREST INCOME

Total non-interest income for the quarter ended December 31, 2022 increased $2.3 million to $9.1 million from $6.8 million for the quarter ended September 30, 2022. The increase was primarily driven by increases of $1.7 million in gain on sales of loans and leases, $0.5 million in other non-interest income, $0.3 million in gain on securities, net, $0.2 million in deposit fees, and $0.1 million in loan fees, partially offset by a decrease of $0.6 million in loan level derivative income, net.

PROVISION FOR CREDIT LOSSES

The Company recorded a provision for credit losses of $5.7 million for the quarter ended December 31, 2022, compared to $2.8 million for the quarter ended September 30, 2022. The $2.9 million increase in provision for credit losses, or 3 cents per share after tax, was due to strong growth in loans and commitments.

Total net charge-offs for the fourth quarter of 2022 were $0.3 million compared to total net recoveries of $0.2 million in the third quarter of 2022. The increase was primarily driven by an increase in net charge-offs on equipment financing loans of $0.5 million. The ratio of net loan and lease charge-offs to average loans and leases on an annualized basis increased to 2 basis points for the fourth quarter of 2022 from a negative 1 basis point for the third quarter of 2022.

The allowance for loan and lease losses represented 1.29 percent of total loans and leases at December 31, 2022, compared to 1.27 percent at September 30, 2022, and 1.38 percent at December 31, 2021.

ASSET QUALITY

The ratio of total nonperforming loans and leases to total loans and leases was 0.19 percent at December 31, 2022 as compared to 0.24 percent at September 30, 2022. Total nonaccrual loans and leases decreased $2.8 million to $14.9 million at December 31, 2022 from $17.7 million at September 30, 2022. The ratio of nonperforming assets to total assets was 0.17 percent at December 31, 2022 as compared to 0.21 percent at September 30, 2022. Total nonperforming assets decreased $3.0 million to $15.3 million at December 31, 2022 from $18.3 million at September 30, 2022.

NON-INTEREST EXPENSE

Non-interest expense for the quarter ended December 31, 2022 increased $2.2 million to $47.2 million from $45.0 million for the quarter ended September 30, 2022. The increase was primarily driven by increases of $1.2 million in compensation and employee benefits, $0.7 million in equipment and data processing expense, $0.5 million in professional services expense, $0.3 million in FDIC insurance expense, $0.2 million in other non-interest expense, and $0.1 million in occupancy expense, partially offset by a decrease of $0.4 million in merger and acquisition expense and a decrease of $0.3 million in advertising and marketing expense.

PROVISION FOR INCOME TAXES

The effective tax rate was 17.8 percent and 21.6 percent for the three and twelve months ended December 31, 2022 compared to 18.7 percent for the three months ended September 30, 2022 and 25.9 percent and 25.3 percent for the three and twelve months ended December 31, 2021.

RETURNS ON AVERAGE ASSETS AND AVERAGE EQUITY

The annualized return on average assets decreased to 1.34 percent during the fourth quarter of 2022 compared to 1.40 percent for the third quarter of 2022; and was 1.27 percent for the year ended December 31, 2022, compared to 1.36 percent for the year ended December 31, 2021.

The annualized return on average tangible stockholders' equity decreased to 14.48 percent during the fourth quarter of 2022 compared to 14.72 percent for the third quarter of 2022; and was 13.35 percent for the year ended December 31, 2022 compared to 14.35 percent for the year ended December 31, 2021.

DIVIDEND DECLARED

The Company’s Board approved a dividend of $0.135 per share for the quarter ended December 31, 2022. The dividend will be paid on February 24, 2023 to stockholders of record on February 10, 2023.

PCSB ACQUISITION

On January 1, 2023, the Company completed its previously announced acquisition (the “merger”) of PCSB Financial Corporation (“PCSB”). Pursuant to the merger agreement, each share of PCSB common stock outstanding at the effective time of the merger was converted into the right to receive, at the holder’s election, either $22.00 in cash consideration or 1.3284 shares of Company common stock for each share of PCSB common stock, subject to allocation procedures to ensure that 60% of the outstanding shares of PCSB common stock was converted to Company common stock. PCSB’s bank subsidiary, PCSB Bank, now operates as a separate subsidiary of the Company and has 15 banking offices throughout the Lower Hudson Valley of New York State.

CONFERENCE CALL

The Company will conduct a conference call/webcast at 1:30 PM Eastern Time on Thursday, January 26, 2023 to discuss the results for the quarter, business highlights and outlook. A copy of the Earnings Presentation is available on the Company’s website, www.brooklinebancorp.com. To listen to the call and view the Company’s Earnings Presentation, please join the call via https://events.q4inc.com/attendee/914981409. To listen to the call without access to the slides, please dial 844-200-6205 (United States) or 929-526-1599 (internationally) and ask for the Brookline Bancorp, Inc. call (Access Code 718736). A recording of the call will be available for one week following the call on the Company’s website under “Investor Relations” or by dialing 866-813-9403 (United States) or 929-458-6194 (internationally) and entering the passcode: 959089.

ABOUT BROOKLINE BANCORP, INC.

Brookline Bancorp, Inc., a bank holding company with approximately $11 billion in assets and branch locations in eastern Massachusetts, Rhode Island and the Lower Hudson Valley of New York State, is headquartered in Boston, Massachusetts and operates as the holding company for Brookline Bank, Bank Rhode Island, and PCSB Bank. The Company provides commercial and retail banking services and cash management and investment services to customers throughout Central New England and the Lower Hudson Valley of New York State. More information about Brookline Bancorp, Inc. and its banks can be found at the following websites: www.brooklinebank.com, www.bankri.com and www.pcsb.com.

FORWARD-LOOKING STATEMENTS

Certain statements contained in this press release that are not historical facts may constitute 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 intended to be covered by the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. We may also make forward-looking statements in other documents we file with the Securities and Exchange Commission ("SEC"), in our annual reports to shareholders, in press releases and other written materials, and in oral statements made by our officers, directors or employees. You can identify forward looking statements by the use of the words “believe,” “expect,” “anticipate,” “intend,” “estimate,” “assume,” “outlook,” “will,” “should,” and other expressions that predict or indicate future events and trends and which do not relate to historical matters, including statements regarding the Company’s business, credit quality, financial condition, liquidity and results of operations. Forward-looking statements may differ, possibly materially, from what is included in this press release due to factors and future developments that are uncertain and beyond the scope of the Company’s control. These include, but are not limited to, the Company’s ability to achieve the synergies and value creation contemplated by the acquisition of PCSB; turbulence in the capital and debt markets; changes in interest rates; competitive pressures from other financial institutions; general economic conditions (including inflation) on a national basis or in the local markets in which the Company operates; changes in consumer behavior due to changing political, business and economic conditions, or legislative or regulatory initiatives; changes in the value of securities and other assets in the Company’s investment portfolio; increases in loan and lease default and charge-off rates; the adequacy of allowances for loan and lease losses; decreases in deposit levels that necessitate increases in borrowing to fund loans and investments; operational risks including, but not limited to, cybersecurity incidents, fraud, natural disasters, the ongoing COVID-19 pandemic and future pandemics; changes in regulation; the possibility that future credit losses may be higher than currently expected due to changes in economic assumptions and adverse economic developments; the risk that goodwill and intangibles recorded in the Company’s financial statements will become impaired; and changes in assumptions used in making such forward-looking statements. Forward-looking statements involve risks and uncertainties which are difficult to predict. The Company’s actual results could differ materially from those projected in the forward-looking statements as a result of, among others, the risks outlined in the Company’s Annual Report on Form 10-K, as updated by its Quarterly Reports on Form 10-Q and other filings submitted to the SEC. The Company does not undertake any obligation to update any forward-looking statement to reflect circumstances or events that occur after the date the forward-looking statements are made.

BASIS OF PRESENTATION

The Company's consolidated financial statements have been prepared in conformity with generally accepted accounting principles (“GAAP”) as set forth by the Financial Accounting Standards Board in its Accounting Standards Codification and through the rules and interpretive releases of the SEC under the authority of federal securities laws. Certain amounts previously reported have been reclassified to conform to the current period's presentation.

NON-GAAP FINANCIAL MEASURES

The Company uses certain non-GAAP financial measures, such as operating earnings, operating earnings per common share, operating return on average assets, operating return on average tangible assets, operating return on average stockholders' equity, operating return on average tangible stockholders' equity, tangible book value per common share, tangible stockholders’ equity to tangible assets, return on average tangible assets (annualized) and return on average tangible stockholders' equity (annualized). These non-GAAP financial measures provide information for investors to effectively analyze financial trends of ongoing business activities, and to enhance comparability with peers across the financial services sector. A detailed reconciliation table of the Company's GAAP to the non-GAAP measures is attached.

INVESTOR RELATIONS:

Contact:Carl M. Carlson
 Brookline Bancorp, Inc.
 Co-President and Chief Financial Officer
 (617) 425-5331
 ccarlson@brkl.com



BROOKLINE BANCORP, INC. AND SUBSIDIARIES
Selected Financial Highlights (Unaudited)
 
 At and for the Three Months EndedAt and for the Twelve Months Ended
 December 31, 2022September 30, 2022June 30,
2022
March 31, 2022December 31, 2021December 31, 2022December 31, 2021
 (Dollars In Thousands Except per Share Data)
Earnings Data:       
Net interest income$80,030 $78,026 $71,867 $69,848 $71,461 $299,771 $282,373 
Provision (credit) for credit losses 5,725  2,835  227  (160) 751  8,627  (7,837)
Non-interest income 9,056  6,834  6,928  5,529  10,699  28,347  26,989 
Non-interest expense 47,225  44,959  44,871  42,487  42,909  179,542  162,608 
Income before provision for income taxes 36,136  37,066  33,697  33,050  38,500  139,949  154,591 
Net income 29,695  30,149  25,195  24,705  28,545  109,744  115,440 
        
Performance Ratios:       
Net interest margin (1) 3.81% 3.80% 3.56% 3.49% 3.52% 3.67% 3.49%
Interest-rate spread (1) 3.35% 3.58% 3.41% 3.31% 3.42% 3.40% 3.32%
Return on average assets (annualized) 1.34% 1.40% 1.18% 1.16% 1.35% 1.27% 1.36%
Return on average tangible assets (annualized) (non-GAAP) 1.37% 1.43% 1.21% 1.18% 1.38% 1.30% 1.38%
Return on average stockholders' equity (annualized) 12.09% 12.29% 10.32% 9.91% 11.56% 11.15% 11.93%
Return on average tangible stockholders' equity (annualized) (non-GAAP) 14.48% 14.72% 12.39% 11.84% 13.84% 13.35% 14.35%
Efficiency ratio (2) 53.01% 52.98% 56.95% 56.37% 52.23% 54.72% 52.56%
        
Per Common Share Data:       
Net income — Basic$0.39 $0.39 $0.33 $0.32 $0.37 $1.42 $1.48 
Net income — Diluted 0.39  0.39  0.33  0.32  0.37  1.42  1.48 
Cash dividends declared 0.135  0.135  0.130  0.130  0.125  0.530  0.490 
Book value per share (end of period) 12.91  12.54  12.63  12.65  12.82  12.91  12.82 
Tangible book value per common share (end of period) (non-GAAP) 10.80  10.43  10.51  10.56  10.73  10.80  10.73 
Stock price (end of period) 14.15  11.65  13.31  15.82  16.19  14.15  16.19 
        
Balance Sheet:       
Total assets$9,222,553 $8,695,708 $8,514,230 $8,633,736 $8,602,622 $9,222,553 $8,602,622 
Total loans and leases 7,644,388  7,421,304  7,291,912  7,223,130  7,154,457  7,644,388  7,154,457 
Total deposits 6,522,146  6,735,605  6,894,457  7,094,378  7,049,906  6,522,146  7,049,906 
Total stockholders’ equity 992,125  963,618  968,496  981,935  995,342  992,125  995,342 
        
Asset Quality:       
Nonperforming assets$15,302 $18,312 $21,259 $26,506 $33,177 $15,302 $33,177 
Nonperforming assets as a percentage of total assets 0.17% 0.21% 0.25% 0.31% 0.39% 0.17% 0.39%
Allowance for loan and lease losses$98,482 $94,169 $93,188 $95,463 $99,084 $98,482 $99,084 
Allowance for loan and lease losses as a percentage of total loans and leases 1.29% 1.27% 1.28% 1.32% 1.38% 1.29% 1.38%
Net loan and lease charge-offs (recoveries)$310 $(179)$1,242 $1,947 $2,124 $3,320 $5,734 
Net loan and lease charge-offs as a percentage of average loans and leases (annualized) 0.02% (0.01)% 0.07% 0.11% 0.12% 0.05% 0.08%
        
Capital Ratios:       
Stockholders’ equity to total assets 10.76% 11.08% 11.38% 11.37% 11.57% 10.76% 11.57%
Tangible stockholders’ equity to tangible assets (non-GAAP) 9.16% 9.39% 9.65% 9.67% 9.87% 9.16% 9.87%
        
(1) Calculated on a fully tax-equivalent basis.       
(2) Calculated as non-interest expense as a percentage of net interest income plus non-interest income.       
        


BROOKLINE BANCORP, INC. AND SUBSIDIARIES
Consolidated Balance Sheets (Unaudited)
 
 December 31, 2022September 30, 2022June 30, 2022March 31, 2022December 31, 2021
ASSETS(In Thousands Except Share Data)
Cash and due from banks$191,767$65,638$50,429$89,032$66,265
Short-term investments191,19246,87339,900204,239261,472
Total cash and cash equivalents382,959112,51190,329293,271327,737
Investment securities available-for-sale656,766675,692717,818730,562720,866
Total investment securities656,766675,692717,818730,562720,866
Loans and leases:     
Commercial real estate loans4,404,1484,269,5124,225,7544,235,3254,103,040
Commercial loans and leases2,016,4991,933,6451,860,1821,800,3831,887,136
Consumer loans1,223,7411,218,1471,205,9761,187,4221,164,281
Total loans and leases7,644,3887,421,3047,291,9127,223,1307,154,457
Allowance for loan and lease losses(98,482)(94,169)(93,188)(95,463)(99,084)
Net loans and leases7,545,9067,327,1357,198,7247,127,6677,055,373
Restricted equity securities71,30744,76035,40629,06628,981
Premises and equipment, net of accumulated depreciation71,39169,91269,55769,36570,359
Right-of-use asset operating leases19,48418,61418,22619,57120,508
Deferred tax asset52,23756,89450,73646,88638,987
Goodwill160,427160,427160,427160,427160,427
Identified intangible assets, net of accumulated amortization1,7811,9022,0222,1422,276
Other real estate owned and repossessed assets408591507990718
Other assets259,887227,270170,478153,789176,390
Total assets$9,222,553$8,695,708$8,514,230$8,633,736$8,602,622
LIABILITIES AND STOCKHOLDERS' EQUITY     
Deposits:     
Demand checking accounts$1,802,518$1,848,562$1,845,365$1,903,331$1,888,462
NOW accounts544,118597,870628,791627,904604,097
Savings accounts762,271824,789894,926967,183915,804
Money market accounts2,174,9522,405,6802,402,9922,432,3772,358,306
Certificate of deposit accounts928,143924,7711,006,7861,048,0361,117,695
Brokered deposit accounts310,144133,933115,597115,547165,542
Total deposits6,522,1466,735,6056,894,4577,094,3787,049,906
Borrowed funds:     
Advances from the FHLBB1,237,823557,895307,967201,236147,907
Subordinated debentures and notes84,04484,00883,97083,93483,897
Other borrowed funds110,785116,86586,263107,727125,517
Total borrowed funds1,432,652758,768478,200392,897357,321
Operating lease liabilities19,48418,61418,22619,57120,508
Mortgagors’ escrow accounts5,6075,7855,7715,7806,296
Reserve for unfunded credits20,60219,55517,51116,30514,794
Accrued expenses and other liabilities229,937193,763131,569122,870158,455
Total liabilities8,230,4287,732,0907,545,7347,651,8017,607,280
Stockholders' equity:     
Common stock, $0.01 par value; 200,000,000 shares authorized; 85,177,172 shares issued, 85,177,172 shares issued, 85,177,172 shares issued, 85,177,172 shares issued, and 85,177,172 shares issued, respectively852852852852852
Additional paid-in capital736,074735,119738,544737,658736,826
Retained earnings, partially restricted412,019392,779372,677357,576342,639
Accumulated other comprehensive income(61,947)(70,227)(44,977)(29,322)(110)
Treasury stock, at cost;     
7,731,445 shares, 7,730,945 shares, 7,995,888 shares, 7,037,464 shares, and 7,037,464 shares, respectively(94,873)(94,866)(98,525)(84,718)(84,718)
Unallocated common stock held by the Employee Stock Ownership Plan;     
0 shares, 4,833 shares, 11,442 shares, 18,051 shares, and 24,660 shares, respectively0(39)(75)(111)(147)
Total stockholders' equity992,125963,618968,496981,935995,342
Total liabilities and stockholders' equity$9,222,553$8,695,708$8,514,230$8,633,736$8,602,622
      


BROOKLINE BANCORP, INC. AND SUBSIDIARIES
Consolidated Statements of Income (Unaudited)
 
 Three Months Ended
 December 31, 2022September 30, 2022 June 30, 2022March 31, 2022December 31, 2021
 (In Thousands Except Share Data)
Interest and dividend income:     
Loans and leases$98,386$84,375$74,287$71,721 $73,560 
Debt securities 3,497 3,337 3,249 2,996  2,972 
Marketable and restricted equity securities 766 467 337 328  325 
Short-term investments 754 464 156 66  88 
Total interest and dividend income 103,403 88,643 78,029 75,111  76,945 
Interest expense:     
Deposits 14,185 7,354 4,282 3,771  4,055 
Borrowed funds 9,188 3,263 1,880 1,492  1,429 
Total interest expense 23,373 10,617 6,162 5,263  5,484 
Net interest income 80,030 78,026 71,867 69,848  71,461 
Provision (credit) for credit losses 5,725 2,835 227 (160) 751 
Net interest income after provision for credit losses 74,305 75,191 71,640 70,008  70,710 
Non-interest income:     
Deposit fees 2,916 2,759 2,744 2,500  2,653 
Loan fees 446 349 666 747  448 
Loan level derivative income, net 670 1,275 1,615 686  3,981 
Gain (loss) on investment securities, net 321     (32)
Gain on sales of loans and leases held-for-sale 2,612 889 291 344  1,933 
Other 2,091 1,562 1,612 1,252  1,716 
Total non-interest income 9,056 6,834 6,928 5,529  10,699 
Non-interest expense:     
Compensation and employee benefits 29,525 28,306 28,772 26,884  28,598 
Occupancy 4,005 3,906 3,807 4,284  3,558 
Equipment and data processing 5,758 5,066 4,931 5,078  4,576 
Professional services 1,546 1,069 1,219 1,226  1,151 
FDIC insurance 1,001 709 739 728  617 
Advertising and marketing 1,052 1,337 1,319 1,272  880 
Amortization of identified intangible assets 120 120 120 134  208 
Merger and acquisition expense 641 1,073 535    
Other 3,577 3,373 3,429 2,881  3,321 
Total non-interest expense 47,225 44,959 44,871 42,487  42,909 
Income before provision for income taxes 36,136 37,066 33,697 33,050  38,500 
Provision for income taxes 6,441 6,917 8,502 8,345  9,955 
Net income$29,695$30,149$25,195$24,705 $28,545 
Earnings per common share:     
Basic$0.39$0.39$0.33$0.32 $0.37 
Diluted$0.39$0.39$0.33$0.32 $0.37 
Weighted average common shares outstanding during the period:    
Basic 76,841,655 76,779,038 77,091,013 77,617,227  77,610,608 
Diluted 77,065,076 77,007,971 77,419,288 77,926,822  77,864,097 
Dividends paid per common share$0.135$0.130$0.130$0.125 $0.125 
      


BROOKLINE BANCORP, INC. AND SUBSIDIARIES
Consolidated Statements of Income (Unaudited)
  
 Twelve Months Ended December 31,
  2022 2021 
 (In Thousands Except Share Data)
Interest and dividend income:  
Loans and leases$328,769$297,927 
Debt securities 13,079 12,178 
Marketable and restricted equity securities 1,898 1,172 
Short-term investments 1,440 252 
Total interest and dividend income 345,186 311,529 
Interest expense:  
Deposits 29,592 20,713 
Borrowed funds 15,823 8,443 
Total interest expense 45,415 29,156 
Net interest income 299,771 282,373 
Provision (credit) for credit losses 8,627 (7,837)
Net interest income after provision for credit losses 291,144 290,210 
Non-interest income:  
Deposit fees 10,919 10,578 
Loan fees 2,208 2,095 
Loan level derivative income, net 4,246 4,680 
Gain (loss) on investment securities, net 321 (38)
Gain on sales of loans and leases held-for-sale 4,136 3,737 
Other 6,517 5,937 
Total non-interest income 28,347 26,989 
Non-interest expense:  
Compensation and employee benefits 113,487 106,786 
Occupancy 16,002 14,961 
Equipment and data processing 20,833 18,322 
Professional services 5,060 4,694 
FDIC insurance 3,177 2,980 
Advertising and marketing 4,980 4,167 
Amortization of identified intangible assets 494 876 
Merger and acquisition expense 2,249  
Other 13,260 9,822 
Total non-interest expense 179,542 162,608 
Income before provision for income taxes 139,949 154,591 
Provision for income taxes 30,205 39,151 
Net income$109,744$115,440 
Earnings per common share:  
Basic$1.42$1.48 
Diluted$1.42$1.48 
Weighted average common shares outstanding during the period: 
Basic 77,079,278 77,974,851 
Diluted 77,351,834 78,243,416 
Dividends paid per common share$0.520$0.480 
   


BROOKLINE BANCORP, INC. AND SUBSIDIARIES
Asset Quality Analysis (Unaudited)
 
 At and for the Three Months Ended
 December 31, 2022September 30, 2022 June 30, 2022 March 31, 2022December 31, 2021
 (Dollars in Thousands)
NONPERFORMING ASSETS:     
Loans and leases accounted for on a nonaccrual basis:     
Commercial real estate mortgage$607 $3,136 $6,470 $8,313 $10,848 
Construction 707         
Total commercial real estate loans 1,314  3,136  6,470  8,313  10,848 
      
Commercial 464  618  892  1,366  2,318 
Equipment financing 9,653  10,544  10,183  11,685  15,014 
Condominium association 58  64  71  77  84 
Total commercial loans and leases 10,175  11,226  11,146  13,128  17,416 
      
Residential mortgage 2,680  2,741  2,412  3,394  3,909 
Home equity 723  616  721  680  285 
Other consumer 2  2  3  1  1 
Total consumer loans 3,405  3,359  3,136  4,075  4,195 
      
Total nonaccrual loans and leases 14,894  17,721  20,752  25,516  32,459 
      
Other repossessed assets 408  591  507  990  718 
Total nonperforming assets$15,302 $18,312 $21,259 $26,506 $33,177 
      
Loans and leases past due greater than 90 days and still accruing$33 $9,583 $266 $4 $1 
      
Troubled debt restructurings on accrual 16,385  9,728  11,524  10,858  12,580 
Troubled debt restructurings on nonaccrual 3,527  4,449  5,097  5,189  6,709 
Total troubled debt restructurings$19,912 $14,177 $16,621 $16,047 $19,289 
      
Nonperforming loans and leases as a percentage of total loans and leases 0.19% 0.24% 0.28% 0.35% 0.45%
Nonperforming assets as a percentage of total assets 0.17% 0.21% 0.25% 0.31% 0.39%
      
PROVISION AND ALLOWANCE FOR LOAN AND LEASE LOSSES:   
Allowance for loan and lease losses at beginning of period$94,169 $93,188 $95,463 $99,084 $102,515 
Charge-offs (658) (598) (1,533) (2,344) (2,562)
Recoveries 348  777  291  397  438 
Net (charge-offs) recoveries (310) 179  (1,242) (1,947) (2,124)
Provision (credit) for loan and lease losses excluding unfunded commitments * 4,623  802  (1,033) (1,674) (1,307)
Allowance for loan and lease losses at end of period$98,482 $94,169 $93,188 $95,463 $99,084 
      
Allowance for loan and lease losses as a percentage of total loans and leases 1.29% 1.27% 1.28% 1.32% 1.38%
      
NET CHARGE-OFFS (RECOVERIES):     
Commercial real estate loans$(6)$(6)$(6)$31 $ 
Commercial loans and leases 320  (179) 1,254  1,948  2,143 
Consumer loans (4) 6  (6) (32) (19)
Total net charge-offs (recoveries)$310 $(179)$1,242 $1,947 $2,124 
      
Net loan and lease charge-offs as a percentage of average loans and leases (annualized) 0.02% (0.01)% 0.07% 0.11% 0.12%
      
*Provision for loan and lease losses does not include provision of $1.0 million, $2.0 million, $1.2 million, $1.5 million, and $2.1 million for credit losses on unfunded commitments during the three months ended December 31, 2022, September 30, 2022, June 30, 2022, March 31, 2022, and December 31, 2021 respectively.     
      



BROOKLINE BANCORP, INC. AND SUBSIDIARIES
Average Yields / Costs (Unaudited)
 
 Three Months Ended
 December 31, 2022September 30, 2022December 31, 2021
 Average
Balance
Interest (1)Average
Yield/ Cost
Average
Balance
Interest (1)Average
Yield/ Cost
Average
Balance
Interest (1)Average
Yield/ Cost
 (Dollars in Thousands)
Assets:         
Interest-earning assets:         
Investments:         
Debt securities (2)$665,969$3,4972.10%$714,226$3,3371.87%$727,734$2,9721.63%
Marketable and restricted equity securities (2) 52,093 7665.88% 36,525 4675.12% 27,019 3254.81%
Short-term investments 60,385 7545.00% 66,257 4642.80% 224,573 880.16%
Total investments 778,447 5,0172.58% 817,008 4,2682.09% 979,326 3,3851.38%
Loans and Leases:         
Commercial real estate loans (3) 4,341,929 53,0884.78% 4,239,155 44,7294.13% 3,996,647 35,7623.50%
Commercial loans (3) 797,312 10,5415.18% 731,095 8,4924.55% 820,932 10,1464.84%
Equipment financing (3) 1,200,911 20,8166.93% 1,157,829 19,0426.58% 1,092,457 18,1756.65%
Residential mortgage loans (3) 842,860 8,0513.82% 826,969 7,5603.66% 796,326 6,7853.41%
Other consumer loans (3) 382,196 5,9406.15% 379,999 4,6054.80% 368,087 2,7512.96%
Total loans and leases 7,565,208 98,4365.20% 7,335,047 84,4284.60% 7,074,449 73,6194.16%
Total interest-earning assets 8,343,655 103,4534.96% 8,152,055 88,6964.35% 8,053,775 77,0043.82%
Non-interest-earning assets 513,976   434,365   408,456  
Total assets$8,857,631  $8,586,420  $8,462,231  
          
Liabilities and Stockholders' Equity:         
Interest-bearing liabilities:         
Deposits:         
NOW accounts$583,499 2570.18%$607,210 5790.38%$528,335 1010.08%
Savings accounts 787,021 1,1550.58% 881,988 6640.30% 897,821 2190.10%
Money market accounts 2,282,217 7,7111.34% 2,423,920 4,0380.66% 2,430,496 1,6150.26%
Certificates of deposit 922,250 2,8651.23% 964,112 1,8030.74% 1,129,645 2,0720.73%
Brokered deposit accounts 218,188 2,1973.99% 117,058 2700.92% 116,611 480.16%
Total interest-bearing deposits 4,793,175 14,1851.17% 4,994,288 7,3540.58% 5,102,908 4,0550.32%
Borrowings:         
Advances from the FHLBB 736,652 6,9793.71% 331,840 1,7002.00% 76,786 1170.59%
Subordinated debentures and notes 84,025 1,3326.34% 83,989 1,2956.17% 83,878 1,2415.92%
Other borrowed funds 148,195 8772.35% 89,019 2681.20% 112,137 710.25%
Total borrowings 968,872 9,1883.71% 504,848 3,2632.53% 272,801 1,4292.05%
Total interest-bearing liabilities 5,762,047 23,3731.61% 5,499,136 10,6170.77% 5,375,709 5,4840.40%
Non-interest-bearing liabilities:         
Demand checking accounts 1,843,780   1,908,459   1,892,763  
Other non-interest-bearing liabilities 269,498   197,446   206,237  
Total liabilities 7,875,325   7,605,041   7,474,709  
Stockholders’ equity 982,306   981,379   987,522  
Total liabilities and equity$8,857,631  $8,586,420  $8,462,231  
Net interest income (tax-equivalent basis) /Interest-rate spread (4)  80,0803.35%  78,0793.58%  71,5203.42%
Less adjustment of tax-exempt income  50   53   59 
Net interest income $80,030  $78,026  $71,461 
Net interest margin (5)  3.81%  3.80%  3.52%
          
(1) Tax-exempt income on debt securities, equity securities and revenue bonds included in commercial real estate loans is included on a tax-equivalent basis.
(2) Average balances include unrealized gains (losses) on investment securities. Dividend payments may not be consistent and average yield on equity securities may vary from month to month.
(3) Loans on nonaccrual status are included in the average balances.
(4) Interest rate spread represents the difference between the yield on interest-earning assets and the cost of interest-bearing liabilities.
(5) Net interest margin represents net interest income (tax-equivalent basis) divided by average interest-earning assets.
          


BROOKLINE BANCORP, INC. AND SUBSIDIARIES
Average Yields / Costs (Unaudited)
 
 Twelve Months Ended
 December 31, 2022December 31, 2021
 Average
Balance
Interest (1)Average
Yield/ Cost
Average
Balance
Interest (1)Average
Yield/ Cost
 (Dollars in Thousands)
Assets:      
Interest-earning assets:      
Investments:      
Debt securities (2)$706,580$13,0791.85%$729,147$12,1781.67%
Marketable and restricted equity securities (2) 36,813 1,8985.15% 34,074 1,1723.44%
Short-term investments 104,288 1,4401.38% 217,784 2520.12%
Total investments 847,681 16,4171.94% 981,005 13,6021.39%
Loans and Leases:      
Commercial real estate loans (3) 4,238,960 172,8114.02% 3,854,357 139,4513.57%
Commercial loans (3) 744,972 34,1054.52% 1,020,627 47,6474.61%
Equipment financing (3) 1,148,673 75,7676.60% 1,081,287 71,9066.65%
Residential mortgage loans (3) 823,512 29,7263.61% 788,614 27,9333.54%
Other consumer loans (3) 376,292 16,5694.40% 369,326 11,2093.03%
Total loans and leases 7,332,409 328,9784.49% 7,114,211 298,1464.19%
Total interest-earning assets 8,180,090 345,3954.22% 8,095,216 311,7483.85%
Non-interest-earning assets 443,313   422,984  
Total assets$8,623,403  $8,518,200  
       
Liabilities and Stockholders' Equity:      
Interest-bearing liabilities:      
Deposits:      
NOW accounts$598,267 8530.14%$502,189 4930.10%
Savings accounts 882,881 2,2280.25% 793,141 9500.12%
Money market accounts 2,387,670 15,3920.64% 2,288,740 6,2140.27%
Certificates of deposit 998,580 8,2100.82% 1,210,451 11,7580.97%
Brokered deposit accounts 146,038 2,9091.99% 338,734 1,2980.38%
Total interest-bearing deposits 5,013,436 29,5920.59% 5,133,255 20,7130.40%
Borrowings:      
Advances from the FHLBB 340,569 9,3552.71% 232,175 3,3021.40%
Subordinated debentures and notes 83,971 5,1336.11% 83,821 4,9675.93%
Other borrowed funds 118,383 1,3351.13% 88,818 1740.20%
Total borrowings 542,923 15,8232.87% 404,814 8,4432.06%
Total interest-bearing liabilities 5,556,359 45,4150.82% 5,538,069 29,1560.53%
Non-interest-bearing liabilities:      
Demand checking accounts 1,879,620   1,787,959  
Other non-interest-bearing liabilities 203,187   224,634  
Total liabilities 7,639,166   7,550,662  
Stockholders’ equity 984,237   967,538  
Total liabilities and equity$8,623,403  $8,518,200  
Net interest income (tax-equivalent basis) /Interest-rate spread (4)  299,9803.40%  282,5923.32%
Less adjustment of tax-exempt income  209   219 
Net interest income $299,771  $282,373 
Net interest margin (5)  3.67%  3.49%
       
(1) Tax-exempt income on debt securities, equity securities and revenue bonds included in commercial real estate loans is included on a tax-equivalent basis.
(2) Average balances include unrealized gains (losses) on investment securities. Dividend payments may not be consistent and average yield on equity securities may vary from month to month.
(3) Loans on nonaccrual status are included in the average balances.
(4) Interest rate spread represents the difference between the yield on interest-earning assets and the cost of interest-bearing liabilities.
(5) Net interest margin represents net interest income (tax-equivalent basis) divided by average interest-earning assets.
       


BROOKLINE BANCORP, INC. AND SUBSIDIARIES
Non-GAAP Financial Information (Unaudited)
 
   At and for the Three Months
Ended December 31,
At and for the Twelve Months
Ended December 31,
     2022  2021  2022  2021 
Reconciliation Table - Non-GAAP Financial Information (Dollars in Thousands Except Share Data)
       
Net income  $29,695 $28,545 $109,744 $115,440 
Less:       
Security gains (losses) (after-tax) 264  (24) 252  (28)
Add:       
Merger and acquisition expenses (after-tax)  527    1,763   
Operating earnings   $29,958 $28,569 $111,255 $115,468 
        
Operating earnings per common share:      
Basic   $0.39 $0.37 $1.44 $1.48 
Diluted    0.39  0.37  1.44  1.48 
        
Weighted average common shares outstanding during the period:     
Basic    76,841,655  77,610,608  77,079,278  77,974,851 
Diluted    77,065,076  77,864,097  77,351,834  78,243,416 
        
        
Return on average assets *   1.34% 1.35% 1.27% 1.36%
Less:       
Security gains (after-tax) *   0.01% % % %
Add:       
Merger and acquisition expenses (after-tax) *  0.02% % 0.02% %
Operating return on average assets *   1.35% 1.35% 1.29% 1.36%
        
        
Return on average tangible assets *   1.37% 1.38% 1.30% 1.38%
Less:       
Security gains (after-tax) *   0.01% % % %
Add:       
Merger and acquisition expenses (after-tax) *  0.02% % 0.02% %
Operating return on average tangible assets *   1.38% 1.38% 1.32% 1.38%
        
        
Return on average stockholders' equity *   12.09% 11.56% 11.15% 11.93%
Less:       
Security gains (losses) (after-tax) *   0.11% (0.01)% 0.03% %
Add:       
Merger and acquisition expenses (after-tax) *  0.21% % 0.18% %
Operating return on average stockholders' equity *  12.19% 11.57% 11.30% 11.93%
        
        
Return on average tangible stockholders' equity *  14.48% 13.84% 13.35% 14.35%
Less:       
Security gains (losses) (after-tax) *   0.13% (0.01)% 0.03% %
Add:       
Merger and acquisition expenses (after-tax) *  0.26% % 0.21% %
Operating return on average tangible stockholders' equity *  14.61% 13.85% 13.53% 14.35%
        
        
* Ratios at and for the three months ended are annualized.     
        
BROOKLINE BANCORP, INC. AND SUBSIDIARIES
Non-GAAP Financial Information (Unaudited)
 
 At and for the Three Months EndedAt and for the Twelve Months Ended
 December 31, 2022September 30, 2022June 30,
2022
March 31,
2022
December 31,
2021
December 31,
2022
December 31,
2021
 (Dollars in Thousands)
        
Net income, as reported$29,695 $30,149 $25,195 $24,705 $28,545 $109,744 $115,440 
        
Average total assets$8,857,631 $8,586,420 $8,515,330 $8,531,043 $8,462,231 $8,623,403 $8,518,200 
Less: Average goodwill and average identified intangible assets, net 162,266  162,387  162,507  162,632  162,804  162,447  163,122 
Average tangible assets$8,695,365 $8,424,033 $8,352,823 $8,368,411 $8,299,427 $8,460,956 $8,355,078 
        
Return on average tangible assets (annualized) 1.37 % 1.43 % 1.21 % 1.18 % 1.38 % 1.30 % 1.38 %
        
Average total stockholders’ equity$982,306 $981,379 $976,167 $997,293 $987,522 $984,237 $967,538 
Less: Average goodwill and average identified intangible assets, net 162,266  162,387  162,507  162,632  162,804  162,447  163,122 
Average tangible stockholders’ equity$820,040 $818,992 $813,660 $834,661 $824,718 $821,790 $804,416 
        
Return on average tangible stockholders’ equity (annualized) 14.48 % 14.72 % 12.39 % 11.84 % 13.84 % 13.35 % 14.35 %
        
Total stockholders’ equity$992,125 $963,618 $968,496 $981,935 $995,342 $992,125 $995,342 
Less:       
Goodwill 160,427  160,427  160,427  160,427  160,427  160,427  160,427 
Identified intangible assets, net 1,781  1,902  2,022  2,142  2,276  1,781  2,276 
Tangible stockholders' equity$829,917 $801,289 $806,047 $819,366 $832,639 $829,917 $832,639 
        
Total assets$9,222,553 $8,695,708 $8,514,230 $8,633,736 $8,602,622 $9,222,553 $8,602,622 
Less:       
Goodwill 160,427  160,427  160,427  160,427  160,427  160,427  160,427 
Identified intangible assets, net 1,781  1,902  2,022  2,142  2,276  1,781  2,276 
Tangible assets$9,060,345 $8,533,379 $8,351,781 $8,471,167 $8,439,919 $9,060,345 $8,439,919 
        
Tangible stockholders’ equity to tangible assets 9.16 % 9.39 % 9.65 % 9.67 % 9.87 % 9.16 % 9.87 %
        
Tangible stockholders' equity$829,917 $801,289 $806,047 $819,366 $832,639 $829,917 $832,639 
        
Number of common shares issued 85,177,172  85,177,172  85,177,172  85,177,172  85,177,172  85,177,172  85,177,172 
Less:       
Treasury shares 7,731,445  7,730,945  7,995,888  7,037,464  7,037,464  7,731,445  7,037,464 
Unallocated ESOP shares 0  4,833  11,442  18,051  24,660  0  24,660 
Unvested restricted shares 601,495  601,995  497,297  500,098  500,098  601,495  500,098 
Number of common shares outstanding 76,844,232  76,839,399  76,672,545  77,621,559  77,614,950  76,844,232  77,614,950 
        
Tangible book value per common share$ 10.80 $ 10.43 $ 10.51 $ 10.56 $ 10.73 $ 10.80 $ 10.73 
        

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Brookline Bancorp, Inc.

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brookline bank is a full-service financial institution with 24 branches in greater boston. brookline bank provides a high level of customized, flexible service to individuals and businesses alike and offers checking, savings and retirement services, home equity lending, residential mortgages, commercial and cre banking, cash management services, merchant services, and access to investment services. for more information call 877-668-2265, or visit brooklinebank.com.