Amalgamated Bank Reports Second Quarter 2018 Financial Results

September 24, 2018 at 6:25 AM EDT

NEW YORK, Sept. 24, 2018 (GLOBE NEWSWIRE) -- Amalgamated Bank (Nasdaq: AMAL) (“Amalgamated” or the “Company”) today announced financial results for the second quarter ended June 30, 2018. 

Second Quarter 2018 Highlights

  • Net income of $11.6 million, or $0.39 per diluted share, as compared to $2.3 million, or $0.08 per diluted share, for the second quarter of 20171
  • Core earnings (non-GAAP) of $11.8 million, or $0.40 per diluted share, as compared to $1.0 million, or $0.04 per diluted share for the second quarter of 2017
  • Closed the acquisition of New Resource Bank (“New Resource”) on May 18, 2018
  • Deposit growth of $874.5 million, or 28.3%, compared to June 30, 2017, and $729.3 million, or 45% annualized, from December 31, 2017, $361.9 million of deposit growth attributed to the acquisition of New Resource
  • Loan growth of $376.7 million, or 13.7%, compared to June 30, 2017, and $306.2 million, or 22% annualized, from December 31, 2017, $334.0 million of loan growth attributed to the acquisition of New Resource
  • Cost of deposits was 0.24%, as compared to 0.26% for the first quarter of 2018 and 0.24% for the second quarter of 2017
  • Net Interest Margin was 3.56%, as compared to 3.43% for the first quarter of 2018 and 3.12% for the second quarter of 2017
  • Tier 1 Leverage, Common Equity Tier 1, and Total Risk-Based capital ratios were 8.59%, 12.46%, and 13.71%, respectively, at June 30, 2018

     (1)   Earnings per diluted share is inclusive of a 20-for-1 stock split effected on July 27, 2018

Keith Mestrich, President and Chief Executive Officer of Amalgamated Bank, commented, “Since our founding in 1923 by the Amalgamated Clothing Workers of America, our goal has been to be the go-to financial partner for people and organizations who strive to make a meaningful impact in our society and who care about their communities, the environment, and social justice.  Indications of our success are evident in our second quarter results, the closing of our acquisition of San Francisco based New Resource, a key step to growing our business and expanding our geographic footprint, and our successful initial public offering in August.”

Keith Mestrich concluded, “Looking forward, we are well positioned to drive deposit growth through our mission based strategy of developing and maintaining relationships with our clients who share similar values while opportunistically exploring acquisitions in attractive markets.”        

Results of Operations, Quarter Ended June 30, 2018

On May 18, 2018 the Company closed the acquisition of New Resource.  New Resource’s results of operations from May 19, 2018 to June 30, 2018 are included in Amalgamated’s consolidated results for the three and six months ended June 30, 2018.

Net income for the second quarter of 2018 was $11.6 million, or $0.39 per diluted share, as compared to $7.7 million, or $0.27 per diluted share, for the first quarter of 2018 and net income of $2.3 million, or $0.08 per diluted share, for the second quarter of 2017.  The $9.3 million increase in net income for the second quarter of 2018, compared to the comparable prior year period was primarily due to a $6.9 million increase in net interest income and a $6.8 million improvement in provision for loan losses, partially offset by a $3.3 million increase in the provision for income taxes.

Core earnings (non-GAAP) for the second quarter of 2018 was $11.8 million, or $0.40 per diluted share, compared to $7.93 million, or $0.28 per diluted share for the first quarter of 2018 and $1.0 million, or $0.04 per diluted share for the second quarter of 2017.  Core earnings for the quarter ended June 30, 2018 exclude $0.3 million of costs related to the acquisition of New Resource.

Net interest income was $36.7 million for the second quarter of 2018, compared to $32.8 million for the first quarter of 2018 and $29.8 million for the second quarter of 2017.  The year over year increase was primarily attributable to an increase in average loans of $356.7 million, an increase in the yield on loans of 15 basis points, an increase in average non-interest bearing deposits of $512.0 million, a decrease in funding costs due to the prepayment of high-cost, long-term borrowings in the second quarter of 2017 and a $267.0 million reduction in the average balance of borrowings.  Accretion of the loan mark related to the New Resource acquisition was $0.3 million in the second quarter of 2018, or three basis points on the Company’s net interest margin.

Net interest margin was 3.56% for the second quarter of 2018, an increase of 13 basis points as compared to 3.43% in the first quarter of 2018, and an increase of 44 basis points from 3.12% in the second quarter of 2017. 

Non-interest income decreased $0.8 million, or 11.6% to $6.2 million in the second quarter of 2018 from $7.0 million in the first quarter of 2018, and decreased $0.1 million or 1.9% from $6.3 million in the second quarter of 2017.  The decrease was primarily due to the loss on the sale of one C&I loan and loss on the sales of foreclosed 1-4 family residential properties, which was partially offset by lower losses on the sales of investment securities and higher fees from custody and investment management services (included within trust department fees) and service charges on deposit accounts.

Non-interest expense for the second quarter of 2018 was $30.1 million, an increase of $1.3 million from $28.8 million in the first quarter of 2018, and an increase of $1.0 million from $29.1 million in the second quarter of 2017.  The increase from the linked quarter was primarily related to the acquisition of New Resource.

Total loans, net of deferred origination fees, at June 30, 2018 were $3.1 billion, an increase of $306.2 million or 11.0% as compared to $2.8 billion as of December 31, 2017, and an increase of $376.7 million or 13.7% as compared to $2.8 billion as of June 30, 2017.  Loan growth was primarily driven by the $334.0 million of loans acquired, net of fair value adjustments from the acquisition of New Resource.

Deposits at June 30, 2018 were $4.0 billion, an increase of $729.3 million or 22.6% as compared to $3.2 billion as of December 31, 2017, and an increase of $874.5 million or 28.3% as compared to $3.1 billion as of June 30, 2017, $361.9 million of deposit growth was attributed to the acquisition of New Resource.  Political deposits were $416.3 million as of June 30, 2018, an increase of $292.2 million compared to June 30, 2017.  The average rate on interest-bearing liabilities was 0.61% for the second quarter, a decrease of 14 basis points from the same period in 2017, which was benefited by the prepayment of long-term borrowings in 2017. The average rate paid on interest-bearing deposits was 0.45% for the second quarter of 2018, an increase of 8 basis points from the second quarter of 2017, which was primarily due to an increase in deposit rates in response to an increasing Federal Funds rate.  Noninterest-bearing deposits represented 45% of average deposits for the three months ended June 30, 2018, contributing to an average cost of deposits of 0.24% in the second quarter of 2018, a two basis point decrease from the linked quarter.

Results of Operations, Six Months Ended June 30, 2018

Net income for the six months ended June 30, 2018 was $19.3 million, or $0.67 per diluted share, as compared to $5.1 million, or $0.18 per diluted share, for the six months ended June 30, 2017.  The $14.1 million increase in net income for the period was primarily due to an $11.4 million increase in net interest income and a $7.0 million improvement in provision for loan losses, partially offset by a $4.4 million increase in the provision for income taxes. 

Core earnings (non-GAAP) for the six months ended June 30, 2018 was $19.7 million, or $0.68 per diluted share, as compared to $4.5 million, or $0.16 per diluted share for the six months ended June 30, 2017.  Core earnings for the six months ended June 30, 2018 exclude $0.5 million of costs related to the acquisition of New Resource.

Net interest income was $69.5 million for the six months ended June 30, 2018, as compared to $58.1 million for the six months ended June 30, 2017.  Net interest margin was 3.50% for the first six months of 2018, compared to 3.05% for the first six months of 2017, an increase of 45 basis points.

Non-interest income decreased to $13.2 million for the six months ended June 30, 2018, or 4.3%, compared to $13.8 million for the six months ended June 30, 2017.  The decrease was primarily due to the loss on the sale of one C&I loan and loss on the sales of foreclosed 1-4 family residential properties, which was partially offset by increased fee income from service charges on deposit accounts.

Non-interest expense for the six months ended June 30, 2018 was $58.9 million, a decrease of $0.7 million or 1.2%, from $59.6 million for the six months ended June 30, 2017. 

Financial Condition

Total assets were $4.6 billion at June 30, 2018, compared to $4.0 billion at December 31, 2017. The increase of $566.8 million was primarily driven by the addition of $410.9 million in total assets acquired, net of fair value adjustments, in the acquisition of New Resource, and by an increase in investment securities of $170.7 million.  The Company recorded $14.1 million of goodwill related to the New Resource acquisition.

Nonperforming assets totaled $52.0 million, or 1.13% of period end total assets at June 30, 2018, a decrease of $3.9 million, compared with $56.0 million, or 1.35% of period end total assets at March 31, 2018. 

The allowance for loan losses decreased to $35.4 million at June 30, 2018 from $37.4 million at March 31, 2018, a decrease of $2.0 million, which was primarily driven by the reduction of the indirect C&I portfolio.  At June 30, 2018, the Company had $51.1 million of impaired loans for which a specific allowance of $9.2 million was made, compared to $53.2 million of impaired loans at March 31, 2018 for which a specific allowance of $9.3 million was made. The ratio of allowance to total loans was 1.13% at June 30, 2018 and 1.26% at March 31, 2018.

Non-GAAP Financial Measures

This release contains certain non-GAAP financial measures including, without limitation, “Core operating revenue,” “Core non-interest expense,” “Core earnings,” “Tangible common equity,” “Core return on average assets,” “Core return on average tangible common equity,” and “Core efficiency ratio.”

Our management utilizes this information to compare our operating performance for 2018 versus certain periods in 2017 and to internally prepared projections.  We believe these non-GAAP financial measures facilitate making period-to-period comparisons and are meaningful indications of our operating performance.  In addition, because intangible assets such as goodwill and other discrete items unrelated to our core business that are excluded vary extensively from company to company, we believe that the presentation of this information allows investors to more easily compare our results to those of other companies. 

The presentation of non-GAAP financial information, however, is not intended to be considered in isolation or as a substitute for GAAP financial measures.  We strongly encourage readers to review the GAAP financial measures included in this release and not to place undue reliance upon any single financial measure. In addition, because non-GAAP financial measures are not standardized, it may not be possible to compare the non-GAAP financial measures presented in this release with other companies’ non-GAAP financial measures having the same or similar names. Reconciliations of non-GAAP financial disclosures to comparable GAAP measures found in this release are set forth in the final pages of this release and also may be viewed on the Company’s website, amalgamatedbank.com.

About Amalgamated Bank 

Amalgamated Bank is a New York-based full-service commercial bank and a chartered trust company with a combined network of 14 branches in New York City, Washington D.C., and San Francisco, and a presence in Pasadena, CA and Boulder, CO. Amalgamated was formed in 1923 as Amalgamated Bank of New York by the Amalgamated Clothing Workers of America, one of the country's oldest labor unions. Amalgamated provides commercial banking and trust services nationally and offers a full range of products and services to both commercial and retail customers. Amalgamated is a proud member of the Global Alliance for Banking on Values and is a certified B Corporation®. As of June 30, 2018, total assets were $4.6 billion, total net loans were $3.1 billion, and total deposits were $4.0 billion. Additionally, as of June 30, 2018, the trust business held $29.3 billion in assets under custody and $11.9 billion in assets under management.

Terminology

Certain terms used in this release are defined as follows:

“Core operating revenue” is defined as total net interest income plus non-interest income excluding gains and losses on sales of securities and excluding other than temporary impairment charges (“OTTI”).  We believe the most directly comparable GAAP financial measure is the total of net interest income and non-interest income.   
                   
“Core non-interest expense” is defined as total non-interest expense excluding any prepayment of long-term borrowings, branch closures, costs related to bank acquisitions, restructuring/severance or post-retirement benefit cancellation impacts. We believe the most directly comparable GAAP financial measure is total non-interest expense. 
             
“Core earnings" is defined as net income after tax excluding gains and losses on sales of securities and excluding OTTI, prepayment of long-term borrowings, branch closures, costs related to bank acquisitions, restructuring/severance, post-retirement benefit cancellation, taxes on notable pre-tax items, pension recycling taxes and valuation allowance release. We believe the most directly comparable GAAP financial measure is net income.
             
“Tangible common equity” and “Tangible book value” and are defined as stockholders’ equity excluding, as applicable, minority interests, preferred stock, goodwill and core deposit intangibles. We believe that the most directly comparable GAAP financial measure is total stockholders’ equity.
             
“Core return on average assets” is defined as “Core earnings” divided by average total assets.  We believe the most directly comparable performance ratio derived from GAAP financial measures is return on average assets calculated by dividing net income by average total assets.
             
“Core return on average tangible common equity” is defined as “Core earnings” divided by “Average tangible common equity.”  We believe the most directly comparable performance ratio derived from GAAP financial measures is return on average equity calculated by dividing net income by average total stockholders’ equity.
                   
“Core efficiency ratio” is defined as “Core non-interest expense” divided by “Core operating revenue.” We believe the most directly comparable performance ratio derived from GAAP financial measures is an efficiency ratio calculated by dividing total non-interest expense by the sum of net interest income and total non-interest income.

Forward Looking Statements

Statements included in this release that are not historical in nature are intended to be, and are hereby identified as, forward-looking statements within the meaning of the Private Securities Litigation Reform Act, Section 21E of the Securities Exchange Act of 1934, as amended. The words “may,” “will,” “anticipate,” “should,” “would,” “believe,” “contemplate,” “expect,” “estimate,” “continue,” “may” and “intend,” as well as other similar words and expressions of the future, are intended to identify forward-looking statements, but other statements not based on historical information may also be considered forward-looking statements. These forward-looking statements include statements related to our business strategy, projected growth, future provisions for loan losses, our asset quality and any loan charge-offs, the composition of our loan portfolio, statements regarding our cost of deposits, anticipated future financial performance, and management’s long-term performance goals, as well as statements relating to the anticipated effects on results of operations and financial condition from expected developments or events, business and growth strategies, anticipated internal growth and the impact of our acquisition of New Resource Bank. These forward-looking statements are subject to known and unknown risks, uncertainties and other factors, any or all of which could cause actual results to differ materially from the results expressed or implied by such forward-looking statements. These risks and uncertainties include, but are not limited to: (i) deterioration in the financial condition of borrowers resulting in significant increases in loan losses and provisions for those losses; (ii) continuation of the historically low short-term interest rate environment; (iii) the inability of Amalgamated Bank to maintain the historical growth rate of its loan portfolio; (iv) changes in loan underwriting, credit review or loss reserve policies associated with economic conditions, examination conclusions, or regulatory developments; (v) effectiveness of Amalgamated Bank’s asset management activities in improving, resolving or liquidating lower-quality assets; (vi) the impact of competition with other financial institutions, including pricing pressures (including those resulting from the Tax Cuts and Jobs Act) and the resulting impact on Amalgamated Bank’s results, including as a result of compression to net interest margin; (vii) greater than anticipated adverse conditions in the national or local economies including in Amalgamated Bank’s core markets (viii) fluctuations or unanticipated changes in interest rates on loans or deposits or that affect the yield curve; (ix) the results of regulatory examinations; (x) the ability to grow and retain low-cost core deposits and retain large, uninsured deposits; (xi) a merger or acquisition; (xii) risks of expansion into new geographic or product markets; (xiii) any matter that would cause Amalgamated Bank to conclude that there was impairment of any asset, including intangible assets; (xiv) inability to comply with regulatory capital requirements, including those resulting from changes to capital calculation methodologies, required capital maintenance levels or regulatory requests or directives; (xv) risks associated with litigation, including the applicability of insurance coverage; (xvi) the risk of successful integration of the businesses Amalgamated Bank has recently acquired with its business; (xvii) the vulnerability of Amalgamated Bank's network and online banking portals, and the systems of parties with whom Amalgamated Bank contracts, to unauthorized access, computer viruses, phishing schemes, spam attacks, human error, natural disasters, power loss and other security breaches; (xviii) the possibility of increased compliance costs resulting from increased regulatory oversight as a result of Amalgamated Bank becoming a publicly traded company; (xix) volatile credit and financial markets both domestic and foreign; (xx) potential deterioration in real estate values (xxi) the risk that the cost savings and any synergies expected from Amalgamated’s merger with New Resource Bank (“NRB”) may not be realized or take longer than anticipated to be realized; (xx) disruption from Amalgamated’s merger with NRB with customers, suppliers, employee or other business partners relationships; (xxi) the risk of successful integration of Amalgamated's and NRB's businesses; (xxii) reputational risk and the reaction of the parties' customers, suppliers, employees or other business partners to Amalgamated's merger with NRB; (xxiii) the risk that the integration of Amalgamated’s and NRB's operations will be more costly or difficult than expected; and (xxiii) the availability and access to capital. Additional factors which could affect the forward looking statements can be found in Amalgamated’s Registration Statement on Form 10, Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, and Current Reports on Form 8-K filed with the FDIC and available on the FDIC's website at https://efr.fdic.gov/fcxweb/efr/index.htmlAmalgamated Bank disclaims any obligation to update or revise any forward-looking statements contained in this release, which speak only as of the date hereof, whether as a result of new information, future events or otherwise.

Media Contact:
Kaye Verville
The Levinson Group
kaye@mollylevinson.com
202-244-1785

Investor Contact:
Jamie Lillis
Solebury Trout
shareholderrelations@amalgamatedbank.com
800-895-4172


Consolidated Statements of Income

       
  For the three months   For the six months
  ended June 30,   ended June 30,
    2018       2017       2018       2017  
                               
INTEREST AND DIVIDEND INCOME                              
Loans $   32,322     $   27,448     $   61,496     $   53,840  
Securities     7,374         6,507         13,618         13,019  
Federal Home Loan Bank of New York stock     248         357         639         782  
Interest-bearing deposits in banks     216         132         651         288  
                               
  Total interest and dividend income     40,160         34,444         76,404         67,929  
                               
INTEREST EXPENSE                              
Deposits     2,212         1,811         4,301         3,429  
Borrowed funds     1,253         2,841         2,606         6,410  
                               
  Total interest expense     3,465         4,652         6,907         9,839  
                               
NET INTEREST INCOME     36,695         29,792         69,497         58,090  
(Release) provision for loan losses     (2,766 )       4,066         (1,916 )       5,073  
                               
  Net interest income after provision for loan losses     39,461         25,726         71,413         53,017  
                               
NON-INTEREST INCOME                              
Trust department fees     4,636         4,478         9,285         9,272  
Service charges on deposit accounts     1,991         1,730         3,770         3,467  
Bank-owned life insurance     399         420         803         843  
Loss on sale of investment securities available for sale, net     (9 )       (525 )       (110 )       (101 )
Other than temporary impairment (OTTI) of securities, net     -          10         (2 )       10  
(Loss) gain on sale of loans, net     (506 )       8         (477 )       24  
(Loss) gain on other real estate owned, net     (486 )       13         (513 )       (20 )
Other     179         191         461         314  
                               
Total non-interest income     6,204         6,325         13,217         13,809  
                               
NON-INTEREST EXPENSE                              
Compensation and employee benefits, net     16,839         6,838         32,215         22,546  
Occupancy and depreciation     4,060         5,504         8,062         9,890  
Professional fees     2,427         2,171         5,620         4,828  
FDIC deposit insurance     576         607         1,131         1,239  
Data processing     2,462         2,667         4,798         4,680  
Office maintenance and depreciation     927         1,154         1,873         2,151  
Amortization of intangible assets     174         -          174         -   
Advertising and promotion     871         1,340         1,517         2,009  
Borrowed funds prepayment fees     4         6,441         4         7,615  
Other     1,798         2,428         3,532         4,678  
                               
  Total non-interest expense     30,138         29,150         58,926         59,636  
                               
Income before provision for income taxes     15,527         2,901         25,704         7,190  
Provision for income taxes     3,935         630         6,451         2,069  
                               
  Net income     11,592         2,271         19,253         5,121  
                               
Net income attributable to noncontrolling interests     -          -          -          -   
                               
Net income attributable to Amalgamated Bank and subsidiaries $   11,592     $   2,271     $   19,253     $   5,121  
                               
Earnings per common share - basic and diluted - (1) $   0.39     $   0.08     $   0.67     $   0.18  
                               
(1) effected for stock split that occurred on July 27, 2018                              
                               


Consolidated Statements of Financial Condition

   
  As of
  June 30,   December 31,
Assets 2018   2017
  (Unaudited)    
Cash and due from banks $ 20,650     $ 7,130  
Interest-bearing deposits in banks   141,369       109,329  
Total cash and cash equivalents   162,019       116,459  
Securities:      
Available for sale, at fair value   1,119,568       943,359  
Held-to-maturity (fair value of $4,124 and $9,718, respectively)   4,123       9,601  
       
Loans held for sale, at fair value   19,272       -  
Loans receivable, net of deferred loan origination fees   3,122,064       2,815,878  
Allowance for loan losses   (35,353 )     (35,965 )
Loans receivable, net   3,086,711       2,779,913  
Accrued interest and dividends receivable   13,190       11,177  
Premises and equipment, net   23,430       22,422  
Bank-owned life insurance   78,284       72,960  
Deferred tax asset, net   39,652       39,307  
Goodwill and other intangible assets   23,021       -  
Other real estate owned   844       1,907  
Other assets   37,820       44,057  
Total assets $ 4,607,934     $ 4,041,162  
Liabilities and Stockholders' Equity              
Deposits $ 3,962,436     $ 3,233,108  
Borrowed funds   141,675       402,605  
Accrued interest payable   1,410       1,434  
Other liabilities   96,102       59,947  
Total liabilities   4,201,623       3,697,094  
Commitments and contingencies      
Stockholders’ equity:      
Preferred Stock:      
Class B - par value $100,000 per share; 77 shares authorized; 67 shares      
issued and outstanding as of December 31, 2017   -       6,700  
Common Stock:      
Class A - par value $.01 per share; 42,000,000 shares authorized; 31,771,584 and      
28,060,980 shares issued and outstanding, respectively (1)   318       281  
Additional paid-in capital (1)   300,913       243,771  
Retained earnings   118,759       99,506  
Total accumulated other comprehensive loss, net of taxes   (13,813 )     (6,324 )
Total Amalgamated Bank stockholders' equity   406,177       343,934  
Noncontrolling interests   134       134  
Total stockholders' equity   406,311       344,068  
Total liabilities and stockholders’ equity $ 4,607,934     $ 4,041,162  
       
(1) effected for stock split that occurred on July 27, 2018      
       


Select Financial Data

               
  As of and for the Three   As of and for the Six
  Months Ended   Months Ended
  June 30, (1)   June 30, (1)
    2018     2017     2018     2017
Selected Financial Ratios and Other Data:              
Earnings              
Basic $   0.39   $   0.08   $   0.67   $   0.18
Diluted     0.39       0.08       0.67       0.18
Core Earnings              
Basic     0.40       0.04       0.68       0.16
Diluted     0.40       0.04       0.68       0.16
               
Book value per common share     12.78       12.28       12.78       12.28
(excluding minority interest)              
Tangible book value per share     12.06       12.04       12.06       12.04
Common shares outstanding     31,771,580       28,060,980       31,771,580       28,060,980
Weighted average common shares     29,814,340       28,060,980       28,942,504       28,060,980
outstanding, basic              
Weighted average common shares     29,814,340       28,060,980       28,942,504       28,060,980
outstanding, diluted              
               
(1) effected for stock split that occurred on July 27, 2018              
               


Select Financial Data

               
  As of and for the Three   As of and for the Six
  Months Ended   Months Ended
  June 30,   June 30,
  2018
  2017
  2018
  2017
               
Selected Performance Metrics:              
Return on average assets 1.07 %   0.23 %   0.93 %   0.26 %
Core return on average assets (non-GAAP) 1.10 %   0.10 %   0.95 %   0.23 %
Return on average equity 12.31 %   2.61 %   10.71 %   2.96 %
Core return on average tangible common equity (non-GAAP) 13.08 %   1.20 %   11.32 %   2.67 %
Loan yield 4.33 %   4.18 %   4.25 %   4.18 %
Securities yield 2.93 %   2.45 %   2.88 %   2.42 %
Deposit cost 0.24 %   0.24 %   0.25 %   0.23 %
Net interest margin 3.56 %   3.12 %   3.50 %   3.05 %
Efficiency ratio 70.25 %   80.71 %   71.24 %   82.94 %
Core efficiency ratio (non-GAAP) 69.51 %   85.33 %   70.52 %   84.14 %
               
Asset Quality Ratios:              
Nonperforming loans to total loans 0.63 %   0.83 %   0.63 %   0.83 %
Nonperforming assets to total assets 1.13 %   2.07 %   1.13 %   2.07 %
Allowance for loan losses to 179 %   177 %   179 %   177 %
nonperforming loans              
Allowance for loan losses to total loans 1.13 %   1.46 %   1.13 %   1.46 %
Net charge-offs (recoveries) to average loans (0.02 %)   0.02 %   (0.04 %)   0.02 %
               
Capital Ratios:              
Tier 1 leverage capital ratio 8.59 %   8.38 %   8.59 %   8.38 %
Tier 1 risk-based capital ratio 12.46 %   11.39 %   12.46 %   11.39 %
Total risk-based capital ratio 13.71 %   12.64 %   13.71 %   12.64 %
Common equity tier 1 capital ratio 12.46 %   11.20 %   12.46 %   11.20 %
               


Portfolio Composition

 

    For the Three months ended   For the Three months ended
    June 30, 2018   June 30, 2017
(in thousands)   Average
Balance
  Income / Expense   Yield /
Rate
  Average
Balance
  Income / Expense   Yield /
Rate
                         
  Interest earning assets:                        
Interest-bearing deposits in banks   $   74,668   $   216   1.16 %   $   77,343   $   132   0.68 %
Securities and FHLB stock       1,045,196       7,622   2.93 %       1,121,602       6,864   2.45 %
Loans held for sale       28,042       -    0.00 %       1,423       -    0.00 %
Loans, net (1)       2,991,273       32,322   4.33 %       2,634,601       27,448   4.18 %
  Total interest earning assets       4,139,179       40,160   3.89 %       3,834,969       34,444   3.60 %
  Non-interest earning assets:                        
Cash and due from banks       13,825               6,684        
Other assets(2)       180,417               176,673        
  Total assets   $   4,333,422           $   4,018,326        
                         
  Interest bearing liabilities:                        
Savings, NOW and money market deposits   $   1,587,825   $   1,225   0.31 %   $   1,505,357   $   985   0.26 %
Time deposits       400,778       987   0.99 %       437,563       826   0.76 %
Total interest bearing deposits       1,988,603       2,212   0.45 %       1,942,920       1,811   0.37 %
Federal Home Loan Bank advances       291,023       1,253   1.73 %       557,951       2,841   2.04 %
  Total interest bearing liabilities       2,279,626       3,465   0.61 %       2,500,871       4,652   0.75 %
                         
  Non interest bearing liabilities:                        
Demand and transaction deposits       1,636,294               1,124,618        
Other liabilities       39,647               43,418        
  Total liabilities       3,955,567               3,668,907        
  Stockholders' equity       377,855               349,419        
  Total liabiliites and stockholders' equity   $   4,333,422           $   4,018,326        
                         
  Net interest income / interest rate spread       $   36,695   3.28 %       $   29,792   2.85 %
  Net interest earning assets / net interest margin   $   1,859,553       3.56 %   $   1,334,098       3.12 %
                         
(1) Amounts are net of deferred origination costs / (fees) and the allowance for loan losses          
(2) Includes non performing  residential 1-4 family loans of $93 and $400 for the  three months ended 2018 and 2017 respectively   
                         


Portfolio Composition

    For the Six months ended   For the Six months ended
    June 30, 2018   June 30, 2017
(in thousands)   Average
Balance
  Income / Expense   Yield /
Rate
  Average
Balance
  Income / Expense   Yield /
Rate
                         
  Interest earning assets:                        
Interest-bearing deposits in banks   $   74,872   $   651   1.75 %   $   96,055   $   288   0.60 %
Securities and FHLB stock       997,932       14,257   2.88 %       1,148,113       13,801   2.42 %
Loans held for sale       14,607       -    0.00 %       715       -    0.00 %
Loans, net (1)       2,918,726       61,496   4.25 %       2,595,687       53,840   4.18 %
  Total interest earning assets       4,006,137       76,404   3.85 %       3,840,570       67,929   3.57 %
  Non-interest earning assets:                        
Cash and due from banks       10,385               6,687        
Other assets(2)       178,347               178,545        
  Total assets   $   4,194,869           $   4,025,802        
                         
  Interest bearing liabilities:                        
Savings, NOW and money market deposits   $   1,539,029   $   2,357   0.31 %   $   1,498,903   $   1,763   0.24 %
Time deposits       393,557       1,944   1.00 %       455,510       1,666   0.74 %
Total interest bearing deposits       1,932,586       4,301   0.45 %       1,954,413       3,429   0.35 %
Federal Home Loan Bank advances       325,371       2,606   1.62 %       588,485       6,378   2.19 %
Other Borrowings     -     -   -         3,051       32   2.13 %
  Total interest bearing liabilities       2,257,957       6,907   0.62 %       2,545,949       9,839   0.78 %
                         
  Non interest bearing liabilities:                        
Demand and transaction deposits       1,530,460               1,085,798        
Other liabilities       43,975               45,462        
  Total liabilities       3,832,392               3,677,209        
  Stockholders' equity       362,477               348,593        
  Total liabiliites and stockholders' equity   $   4,194,869           $   4,025,802        
                         
  Net interest income / interest rate spread       $   69,497   3.23 %       $   58,090   2.79 %
  Net interest earning assets / net interest margin   $   1,748,180       3.50 %   $   1,294,621       3.05 %
                         
(1) Amounts are net of deferred origination costs / (fees) and the allowance for loan losses          
(2) Includes non performing  residential 1-4 family loans of $1,496 and $339 for the six months ended 2018 and 2017 respectively   


Reconciliation of GAAP to Non-GAAP Financial Measures
The information provided below presents a reconciliation of each of our non-GAAP financial measures to the most directly comparable GAAP financial measure. 

               
  For the Three   For the Six
  Months Ended   Months Ended
  June 30,   June 30,
    2018       2017       2018