Amalgamated Financial Corp. Reports First Quarter 2021 Financial Results
On
First Quarter 2021 Highlights
- Net income of
$12.2 million , or$0.39 per diluted share, compared to$13.8 million , or$0.44 per diluted share, for the fourth quarter of 2020 and$9.5 million , or$0.30 per diluted share for the first quarter of 2020 - Core net income (non-GAAP)[1] of
$13.0 million , or$0.41 per diluted share, compared to$13.8 million , or$0.44 per diluted share for the fourth quarter of 2020 and$9.2 million , or$0.29 per diluted share, for the first quarter of 2020 - Deposit increase of
$381.4 million to$5.7 billion compared to a balance of$5.3 billion onDecember 31, 2020 - Loan decrease of
$224.5 million to$3.2 billion due to increased prepayment activity, compared to a balance of$3.4 billion on December 31, 2020 - Growth in PACE assessments of
$30.6 million , or 29.5% annualized, from a balance of$421.0 million onDecember 31, 2020 - Cost of deposits was 0.11%, compared to 0.13% for the fourth quarter of 2020 and 0.33% for the first quarter of 2020
- Net interest margin was 2.85%, compared to 3.06% for the fourth quarter of 2020 and 3.46% for the first quarter of 2020
- Common Equity Tier 1, Total Risk-Based, and Tier 1 Leverage capital ratios were 13.70%, 14.74%, and 8.06%, respectively, at
March 31, 2021 - Total nonperforming assets were
$81.0 million or 1.27% of total assets as ofMarch 31, 2021 , compared to$82.2 million or 1.38% of total assets atDecember 31, 2020 and$65.6 million , or 1.14% of total assets atMarch 31, 2020
_________________________
[1] Reconciliations of non-GAAP financial measures to the most comparable GAAP measure are set forth on the last page of the financial information accompanying this press release and may also be found on our website, www.amalgamatedbank.com.
COVID-19 Update
Amalgamated’s primary concern during the COVID-19 pandemic is for the health and well-being of our employees, customers, and communities. Our employees continue to operate primarily in a work from home environment, and we continue to perform well, effectively transitioning many customers to our digital platform.
We have offered payment deferrals as an option for our consumer and commercial borrowers who are experiencing financial stress as a result of COVID-19 impacts. As of
Results of Operations, Quarter Ended
Net income for the first quarter of 2021 was
Core net income (non-GAAP) for the first quarter of 2021 was
Net interest income was
Net interest margin was 2.85% for the first quarter of 2021, a decrease of 21 basis points from 3.06% in the fourth quarter of 2020, and a decrease of 61 basis points from 3.46% in the first quarter of 2020. The accretion of the loan mark from the loans we acquired in our
Provisions for loan losses totaled a recovery of
Non-interest income was
Non-interest expense for the first quarter of 2021 was
Our provision for income tax expense was
Financial Condition
Total assets were
Total loans, net at
Deposits at
Nonperforming assets totaled
The allowance for loan losses decreased
Capital
As of
Our tangible book value per share was
Conference Call
As previously announced,
Interested investors and other parties may also listen to a simultaneous webcast of the conference call by logging onto the investor relations section of our website at http://ir.amalgamatedbank.com/. The online replay will remain available for a limited time beginning immediately following the call.
The presentation materials for the call can be accessed on the investor relations section of our website at http://ir.amalgamatedbank.com/.
About
Non-GAAP Financial Measures
This release (and the accompanying financial information and tables) refers to certain non-GAAP financial measures including, without limitation, “Core operating revenue,” “Core non-interest expense,” “Core net income,” “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
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 our website, amalgamatedbank.com.
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 gains on the sale of owned property. 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 costs related to branch closures and restructuring/severance costs. We believe the most directly comparable GAAP financial measure is total non-interest expense.
“Core net income” is defined as net income after tax excluding gains and losses on sales of securities, gains on the sale of owned property, costs related to branch closures, restructuring/severance costs, and taxes on notable pre-tax items. 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 net income” 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 net income” 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. Forward-looking statements generally can be identified through the use of forward-looking terminology such as “may,” “will,” “anticipate,” “should,” “would,” “believe,” “contemplate,” “expect,” “estimate,” “continue,” “in the future,” “may” and “intend,” as well as other similar words and expressions of the future, and in this press release include statements about expected performance of our loan portfolio and payment deferrals, the wind-down of our real estate fund and the expected charges and anticipated consolidation of our branch network and our solar tax equity investments. 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) our inability to maintain the historical growth rate of the 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 our asset management activities in improving, resolving or liquidating lower-quality assets; (vi) the impact of competition with other financial institutions, including pricing pressures and the resulting impact on our 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 our core markets, including, but not limited to, the negative impacts and disruptions resulting from the outbreak of the novel coronavirus, or COVID-19, which may continue to have an adverse impact on our business, operations and performance, and could continue to have a negative impact on our credit portfolio, share price, borrowers, and on the economy as a whole, both domestically and globally (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) potential deterioration in real estate values; (xi) changes in legislation, regulation, policies, or administrative practices, whether by judicial, governmental, or legislative action, including, but not limited to, the Coronavirus Aid, Relief, and Economic Security Act, or the “CARES Act”; (xii) the risk that the preliminary financial information reported herein and our current preliminary analysis will be different when our review is finalized; (xiii) our inability to timely identify a new Chief Financial Officer in light of, among other things, competition for experienced executives in the banking industry; and (xiiii) unexpected challenges and potential operational disruptions related to our executive officer transition. Additional factors which could affect the forward-looking statements can be found in our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, and Current Reports on Form 8-K filed with the
Investor Contact:
Solebury Trout
shareholderrelations@amalgamatedbank.com
800-895-4172
Consolidated Statements of Income (unaudited)
| Three Months Ended | ||||||||||||
| ($ in thousands) | 2021 | 2020 | 2020 | |||||||||
| INTEREST AND DIVIDEND INCOME | ||||||||||||
| Loans | $ | 31,109 | $ | 35,544 | $ | 35,612 | ||||||
| Securities | 12,170 | 11,816 | 12,554 | |||||||||
| 48 | 36 | 69 | ||||||||||
| Interest-bearing deposits in banks | 90 | 66 | 396 | |||||||||
| Total interest and dividend income | 43,417 | 47,462 | 48,631 | |||||||||
| INTEREST EXPENSE | ||||||||||||
| Deposits | 1,573 | 1,807 | 3,915 | |||||||||
| Borrowed funds | — | — | 27 | |||||||||
| Total interest expense | 1,573 | 1,807 | 3,942 | |||||||||
| NET INTEREST INCOME | 41,844 | 45,655 | 44,689 | |||||||||
| Provision for (recovery of) loan losses | (3,261 | ) | 4,589 | 8,588 | ||||||||
| Net interest income after provision for loan losses | 45,105 | 41,066 | 36,101 | |||||||||
| NON-INTEREST INCOME | ||||||||||||
| Trust Department fees | 3,827 | 3,533 | 4,085 | |||||||||
| Service charges on deposit accounts | 2,178 | 2,811 | 2,411 | |||||||||
| Bank-owned life insurance | 788 | 363 | 384 | |||||||||
| Gain (loss) on sale of investment securities available for sale, net | 21 | — | 499 | |||||||||
| Gain (loss) on sale of loans, net | 707 | 1,320 | 135 | |||||||||
| Gain (loss) on other real estate owned, net | — | — | (23 | ) | ||||||||
| Equity method investments | (3,682 | ) | 1,825 | — | ||||||||
| Other | 161 | 188 | 1,627 | |||||||||
| Total non-interest income | 4,000 | 10,040 | 9,118 | |||||||||
| NON-INTEREST EXPENSE | ||||||||||||
| Compensation and employee benefits | 18,039 | 17,082 | 17,458 | |||||||||
| Occupancy and depreciation | 3,501 | 3,385 | 5,506 | |||||||||
| Professional fees | 3,661 | 4,033 | 2,983 | |||||||||
| Data processing | 3,005 | 3,174 | 2,264 | |||||||||
| Office maintenance and depreciation | 655 | 776 | 856 | |||||||||
| Amortization of intangible assets | 302 | 342 | 342 | |||||||||
| Advertising and promotion | 597 | 1,003 | 667 | |||||||||
| Other | 3,033 | 2,875 | 2,194 | |||||||||
| Total non-interest expense | 32,793 | 32,670 | 32,270 | |||||||||
| Income before income taxes | 16,312 | 18,436 | 12,949 | |||||||||
| Income tax expense (benefit) | 4,123 | 4,646 | 3,404 | |||||||||
| Net income | 12,189 | 13,790 | 9,545 | |||||||||
| Net income attributable to |
$ | 12,189 | $ | 13,790 | $ | 9,545 | ||||||
| Earnings per common share - basic | 0.39 | 0.44 | 0.30 | |||||||||
| Earnings per common share - diluted | 0.39 | 0.44 | 0.30 | |||||||||
Consolidated Statements of Financial Condition
| ($ in thousands) | |||||||
| Assets | (unaudited) | ||||||
| Cash and due from banks | $ | 7,387 | $ | 7,736 | |||
| Interest-bearing deposits in banks | 497,536 | 31,033 | |||||
| Total cash and cash equivalents | 504,923 | 38,769 | |||||
| Securities: | |||||||
| Available for sale, at fair value (amortized cost of |
1,688,924 | 1,539,862 | |||||
| Held-to-maturity (fair value of |
531,274 | 494,449 | |||||
| Loans held for sale | 16,661 | 11,178 | |||||
| Loans receivable, net of deferred loan origination costs (fees) | 3,259,504 | 3,488,895 | |||||
| Allowance for loan losses | (36,662 | ) | (41,589 | ) | |||
| Loans receivable, net | 3,222,842 | 3,447,306 | |||||
| Resell agreements | 152,268 | 154,779 | |||||
| Accrued interest and dividends receivable | 21,465 | 23,970 | |||||
| Premises and equipment, net | 12,970 | 12,977 | |||||
| Bank-owned life insurance | 105,666 | 105,888 | |||||
| Right-of-use lease asset | 34,453 | 36,104 | |||||
| Deferred tax asset, net | 26,061 | 36,079 | |||||
| 12,936 | 12,936 | ||||||
| Other intangible assets | 5,057 | 5,359 | |||||
| Equity investments | 8,101 | 11,735 | |||||
| Other assets | 41,625 | 47,240 | |||||
| Total assets | $ | 6,385,226 | $ | 5,978,631 | |||
| Liabilities | |||||||
| Deposits | $ | 5,720,067 | $ | 5,338,711 | |||
| Operating leases | 51,057 | 53,173 | |||||
| Other liabilities | 73,880 | 50,926 | |||||
| Total liabilities | 5,845,004 | 5,442,810 | |||||
| Commitments and contingencies | — | — | |||||
| Stockholders’ equity | |||||||
| Common stock, par value |
312 | 310 | |||||
| Additional paid-in capital | 300,079 | 300,989 | |||||
| Retained earnings | 226,887 | 217,213 | |||||
| Accumulated other comprehensive income (loss), net of income taxes | 12,811 | 17,176 | |||||
| 540,089 | 535,688 | ||||||
| Noncontrolling interests | 133 | 133 | |||||
| Total stockholders' equity | 540,222 | 535,821 | |||||
| Total liabilities and stockholders’ equity | $ | 6,385,226 | $ | 5,978,631 | |||
Select Financial Data
| As of and for the | |||||||||||
| Three Months Ended | |||||||||||
| (Shares in thousands) | 2021 | 2020 | 2020 | ||||||||
| Selected Financial Ratios and Other Data: | |||||||||||
| Earnings | |||||||||||
| Basic | $ | 0.39 | $ | 0.44 | $ | 0.30 | |||||
| Diluted | 0.39 | 0.44 | 0.30 | ||||||||
| Core net income (non-GAAP) | |||||||||||
| Basic | $ | 0.42 | $ | 0.44 | $ | 0.29 | |||||
| Diluted | 0.41 | 0.44 | 0.29 | ||||||||
| Book value per common share (excluding minority interest) | 17.33 | 17.25 | 15.26 | ||||||||
| Tangible book value per share (non-GAAP) | 16.75 | 16.66 | 14.64 | ||||||||
| Common shares outstanding | 31,169 | 31,050 | 31,000 | ||||||||
| Weighted average common shares outstanding, basic | 31,082 | 31,050 | 31,411 | ||||||||
| Weighted average common shares outstanding, diluted | 31,524 | 31,145 | 31,806 | ||||||||
Select Financial Data
| As of and for the | ||||||||
| Three Months Ended | ||||||||
| 2021 | 2020 | 2020 | ||||||
| Selected Performance Metrics: | ||||||||
| Return on average assets | 0.79 | % | 0.89 | % | 0.71 | % | ||
| Core return on average assets (non-GAAP) | 0.85 | % | 0.89 | % | 0.68 | % | ||
| Return on average equity | 9.11 | % | 10.34 | % | 7.65 | % | ||
| Core return on average tangible common equity (non-GAAP) | 10.05 | % | 10.72 | % | 7.66 | % | ||
| Average equity to average assets | 8.71 | % | 8.58 | % | 9.25 | % | ||
| Tangible common equity to assets | 8.18 | % | 8.65 | % | 7.89 | % | ||
| Loan yield | 3.83 | % | 4.04 | % | 4.13 | % | ||
| Securities yield | 2.18 | % | 2.21 | % | 3.29 | % | ||
| Deposit cost | 0.11 | % | 0.13 | % | 0.33 | % | ||
| Net interest margin | 2.85 | % | 3.06 | % | 3.46 | % | ||
| Efficiency ratio (1) | 71.53 | % | 58.66 | % | 59.97 | % | ||
| Core efficiency ratio (non-GAAP) (1) | 69.18 | % | 58.66 | % | 59.44 | % | ||
| Asset Quality Ratios: | ||||||||
| Nonaccrual loans to total loans | 1.78 | % | 1.75 | % | 0.96 | % | ||
| Nonperforming assets to total assets | 1.27 | % | 1.38 | % | 1.14 | % | ||
| Allowance for loan losses to nonaccrual loans | 63.32 | % | 68.26 | % | 124.66 | % | ||
| Allowance for loan losses to total loans | 1.13 | % | 1.19 | % | 1.19 | % | ||
| Annualized net charge-offs (recoveries) to average loans | 0.20 | % | 1.24 | % | 0.01 | % | ||
| Capital Ratios: | ||||||||
| Tier 1 leverage capital ratio | 8.06 | % | 7.97 | % | 8.47 | % | ||
| Tier 1 risk-based capital ratio | 13.70 | % | 13.11 | % | 12.74 | % | ||
| Total risk-based capital ratio | 14.74 | % | 14.25 | % | 13.96 | % | ||
| Common equity tier 1 capital ratio | 13.70 | % | 13.11 | % | 12.74 | % | ||
| (1) Efficiency ratio is calculated by dividing total non-interest expense by the sum of net interest income and total non-interest income | ||||||||
Loan and Held-to-Maturity Securities Portfolio Composition
| (In thousands) | At |
At |
At |
||||||||||||||||||
| Amount | % of total loans | Amount | % of total loans | Amount | % of total loans | ||||||||||||||||
| Commercial portfolio: | |||||||||||||||||||||
| Commercial and industrial | $ | 612,581 | 18.8 | % | $ | 677,192 | 19.5 | % | $ | 532,351 | 15.0 | % | |||||||||
| Multifamily | 882,231 | 27.2 | % | 947,177 | 27.2 | % | 936,350 | 26.4 | % | ||||||||||||
| Commercial real estate | 364,308 | 11.2 | % | 372,736 | 10.7 | % | 408,766 | 11.5 | % | ||||||||||||
| Construction and land development | 50,267 | 1.5 | % | 56,087 | 1.6 | % | 65,706 | 1.9 | % | ||||||||||||
| Total commercial portfolio | 1,909,387 | 58.7 | % | 2,053,192 | 59.0 | % | 1,943,173 | 54.8 | % | ||||||||||||
| Retail portfolio: | |||||||||||||||||||||
| Residential real estate lending | 1,137,851 | 35.0 | % | 1,238,697 | 35.5 | % | 1,416,796 | 39.9 | % | ||||||||||||
| Consumer and other | 206,451 | 6.3 | % | 190,676 | 5.5 | % | 189,152 | 5.3 | % | ||||||||||||
| Total retail | 1,344,302 | 41.3 | % | 1,429,373 | 41.0 | % | 1,605,948 | 45.2 | % | ||||||||||||
| Total loans | 3,253,689 | 100.0 | % | 3,482,565 | 100.0 | % | 3,549,121 | 100.0 | % | ||||||||||||
| Net deferred loan origination fees (costs) | 5,815 | 6,330 | 8,214 | ||||||||||||||||||
| Allowance for loan losses | (36,662 | ) | (41,589 | ) | (42,348 | ) | |||||||||||||||
| Total loans, net | $ | 3,222,842 | $ | 3,447,306 | $ | 3,514,987 | |||||||||||||||
| Held-to-maturity securities portfolio: | |||||||||||||||||||||
| PACE assessments | 451,643 | 85.0 | % | 421,036 | 85.2 | % | 255,298 | 89.2 | % | ||||||||||||
| Other securities | 79,631 | 15.0 | % | 73,413 | 14.8 | % | 30,953 | 10.8 | % | ||||||||||||
| Total held-to-maturity securities | $ | 531,274 | 100.0 | % | 494,449 | 100.0 | % | 286,251 | 100.0 | % | |||||||||||
Net Interest Income Analysis
| Three Months Ended | ||||||||||||||||||||||||||||||||
| (In thousands) | Average Balance |
Income / Expense | Yield / Rate |
Average Balance |
Income / Expense | Yield / Rate |
Average Balance |
Income / Expense | Yield / Rate |
|||||||||||||||||||||||
| Interest earning assets: | ||||||||||||||||||||||||||||||||
| Interest-bearing deposits in banks | $ | 380,390 | $ | 90 | 0.10 | % | $ | 299,881 | $ | 66 | 0.09 | % | $ | 185,281 | $ | 396 | 0.86 | % | ||||||||||||||
| Securities and FHLB stock | 2,271,218 | 12,218 | 2.18 | % | 2,133,957 | 11,852 | 2.21 | % | 1,544,848 | 12,623 | 3.29 | % | ||||||||||||||||||||
| Total loans, net (1)(2) | 3,293,775 | 31,109 | 3.83 | % | 3,503,929 | 35,544 | 4.04 | % | 3,464,438 | 35,612 | 4.13 | % | ||||||||||||||||||||
| Total interest earning assets | 5,945,383 | 43,417 | 2.96 | % | 5,937,767 | 47,462 | 3.18 | % | 5,194,567 | 48,631 | 3.77 | % | ||||||||||||||||||||
| Non-interest earning assets: | ||||||||||||||||||||||||||||||||
| Cash and due from banks | 7,307 | 7,594 | 9,539 | |||||||||||||||||||||||||||||
| Other assets | 279,308 | 237,628 | 222,757 | |||||||||||||||||||||||||||||
| Total assets | $ | 6,231,998 | $ | 6,182,989 | $ | 5,426,863 | ||||||||||||||||||||||||||
| Interest bearing liabilities: | ||||||||||||||||||||||||||||||||
| Savings, NOW and money market deposits | $ | 2,512,892 | $ | 1,222 | 0.20 | % | $ | 2,356,137 | $ | 1,384 | 0.23 | % | $ | 2,143,247 | $ | 2,737 | 0.51 | % | ||||||||||||||
| Time deposits | 280,057 | 351 | 0.51 | % | 268,896 | 423 | 0.63 | % | 381,053 | 1,178 | 1.24 | % | ||||||||||||||||||||
| Total deposits | 2,792,949 | 1,573 | 0.23 | % | 2,625,033 | 1,807 | 0.27 | % | 2,524,300 | 3,915 | 0.62 | % | ||||||||||||||||||||
| 495 | — | 0.00 | % | — | — | 0.00 | % | 6,374 | 27 | 1.70 | % | |||||||||||||||||||||
| Total interest bearing liabilities | 2,793,444 | 1,573 | 0.23 | % | 2,625,033 | 1,807 | 0.27 | % | 2,530,674 | 3,942 | 0.63 | % | ||||||||||||||||||||
| Non-interest bearing liabilities: | ||||||||||||||||||||||||||||||||
| Demand and transaction deposits | 2,786,581 | 2,947,075 | 2,300,999 | |||||||||||||||||||||||||||||
| Other liabilities | 109,420 | 80,529 | 93,309 | |||||||||||||||||||||||||||||
| Total liabilities | 5,689,445 | 5,652,637 | 4,924,982 | |||||||||||||||||||||||||||||
| Stockholders' equity | 542,553 | 530,352 | 501,881 | |||||||||||||||||||||||||||||
| Total liabilities and stockholders' equity | $ | 6,231,998 | $ | 6,182,989 | $ | 5,426,863 | ||||||||||||||||||||||||||
| Net interest income / interest rate spread | $ | 41,844 | 2.73 | % | $ | 45,655 | 2.91 | % | $ | 44,689 | 3.14 | % | ||||||||||||||||||||
| Net interest earning assets / net interest margin | $ | 3,151,939 | 2.85 | % | $ | 3,312,734 | 3.06 | % | $ | 2,663,893 | 3.46 | % | ||||||||||||||||||||
| Total Cost of Deposits | 0.11 | % | 0.13 | % | 0.33 | % | ||||||||||||||||||||||||||
(1) Amounts are net of deferred origination costs / (fees) and the allowance for loan losses
(2) Includes prepayment penalty interest income in 1Q2021, 4Q2020, and 1Q2020 of
Deposit Portfolio Composition
| (In thousands) | |||||||||||
| Non-interest bearing demand deposit accounts | $ | 2,819,627,000 | $ | 2,603,274,000 | $ | 2,423,760,000 | |||||
| NOW accounts | 206,145,000 | 205,653,000 | 234,268,000 | ||||||||
| Money market deposit accounts | 2,067,886,000 | 1,914,391,000 | 1,708,818,000 | ||||||||
| Savings accounts | 361,731,000 | 343,368,000 | 329,583,000 | ||||||||
| Time deposits | 264,678,000 | 272,025,000 | 380,128,000 | ||||||||
| Total deposits | $ | 5,720,067,000 | $ | 5,338,711,000 | $ | 5,076,557,000 | |||||
| Three Months Ended | |||||||||||||||||||||||
| (In thousands) | Average Balance |
Average Rate Paid | Average Balance |
Average Rate Paid | Average Balance |
Average Rate Paid | |||||||||||||||||
| Non-interest bearing demand deposit accounts | $ | 2,786,581 | 0.00 | % | $ | 2,947,075 | 0.00 | % | $ | 2,300,999 | 0.00 | % | |||||||||||
| NOW accounts | 198,117 | 0.08 | % | 194,555 | 0.08 | % | 231,707 | 0.40 | % | ||||||||||||||
| Money market deposit accounts | 1,963,707 | 0.23 | % | 1,823,391 | 0.27 | % | 1,587,242 | 0.60 | % | ||||||||||||||
| Savings accounts | 351,068 | 0.11 | % | 338,192 | 0.12 | % | 324,298 | 0.18 | % | ||||||||||||||
| Time deposits | 280,057 | 0.51 | % | 268,896 | 0.62 | % | 381,053 | 1.24 | % | ||||||||||||||
| Total deposits | $ | 5,579,530 | 0.11 | % | $ | 5,572,109 | 0.13 | % | $ | 4,825,299 | 0.33 | % | |||||||||||
Asset Quality
| (In thousands) | |||||||||||
| Loans 90 days past due and accruing | $ | 2,424 | $ | 1,404 | $ | 3,856 | |||||
| Nonaccrual loans excluding held for sale loans and restructured loans | 37,324 | 40,039 | 7,537 | ||||||||
| Nonaccrual loans held for sale | — | — | — | ||||||||
| Troubled debt restructured loans - nonaccrual | 20,578 | 20,885 | 26,435 | ||||||||
| Troubled debt restructured loans - accruing | 17,656 | 19,553 | 26,968 | ||||||||
| Other real estate owned | 2,988 | 306 | 786 | ||||||||
| Impaired securities | 61 | 47 | 64 | ||||||||
| Total nonperforming assets | $ | 81,031 | $ | 82,234 | $ | 65,646 | |||||
| Nonaccrual loans: | |||||||||||
| Commercial and industrial | $ | 12,347 | $ | 12,444 | $ | 15,949 | |||||
| Multifamily | 7,660 | 9,575 | — | ||||||||
| Commercial real estate | 4,133 | 3,433 | 3,634 | ||||||||
| Construction and land development | 8,605 | 11,184 | 3,652 | ||||||||
| Total commercial portfolio | 32,745 | 36,636 | 23,235 | ||||||||
| Residential real estate lending | 24,300 | 23,656 | 10,057 | ||||||||
| Consumer and other | 857 | 632 | 680 | ||||||||
| Total retail portfolio | 25,157 | 24,288 | 10,737 | ||||||||
| Total nonaccrual loans | $ | 57,902 | $ | 60,924 | $ | 33,972 | |||||
| Nonaccrual loans to total loans | 1.78 | % | 1.75 | % | 0.96 | % | |||||
| Nonperforming assets to total assets | 1.27 | % | 1.38 | % | 1.14 | % | |||||
| Allowance for loan losses to nonaccrual loans | 63.32 | % | 68.26 | % | 124.66 | % | |||||
| Allowance for loan losses to total loans | 1.13 | % | 1.19 | % | 1.19 | % | |||||
| Annualized net charge-offs (recoveries) to average loans | 0.20 | % | 1.24 | % | 0.01 | % | |||||
Credit Quality
| ($ in thousands) | Pass | Special Mention | Substandard | Doubtful | Total | ||||||||||||||
| Commercial and industrial | $ | 566,421 | $ | 17,622 | $ | 28,079 | $ | 459 | $ | 612,581 | |||||||||
| Multifamily | 742,746 | 108,016 | 28,296 | 3,173 | 882,231 | ||||||||||||||
| Commercial real estate | 257,178 | 32,878 | 74,252 | — | 364,308 | ||||||||||||||
| Construction and land development | 33,971 | 7,691 | 8,605 | — | 50,267 | ||||||||||||||
| Residential real estate lending | 1,113,551 | — | 24,300 | — | 1,137,851 | ||||||||||||||
| Consumer and other | 205,594 | — | 857 | — | 206,451 | ||||||||||||||
| Total loans | $ | 2,919,461 | $ | 166,207 | $ | 164,389 | $ | 3,632 | $ | 3,253,689 | |||||||||
| ($ in thousands) | Pass | Special Mention | Substandard | Doubtful | Total | ||||||||||||||
| Commercial and industrial | $ | 627,553 | $ | 16,407 | $ | 32,770 | $ | 462 | $ | 677,192 | |||||||||
| Multifamily | 775,605 | 138,090 | 33,482 | — | 947,177 | ||||||||||||||
| Commercial real estate | 276,712 | 41,420 | 54,604 | — | 372,736 | ||||||||||||||
| Construction and land development | 28,967 | 15,936 | 11,184 | — | 56,087 | ||||||||||||||
| Residential real estate lending | 1,215,417 | — | 23,280 | — | 1,238,697 | ||||||||||||||
| Consumer and other | 190,044 | — | 632 | — | 190,676 | ||||||||||||||
| Total loans | $ | 3,114,298 | $ | 211,853 | $ | 155,952 | $ | 462 | $ | 3,482,565 | |||||||||
| ($ in thousands) | Pass | Special Mention | Substandard | Doubtful | Total | ||||||||||||||
| Commercial and industrial | $ | 480,816 | $ | 15,797 | $ | 35,271 | $ | 467 | $ | 532,351 | |||||||||
| Multifamily | 936,350 | — | — | — | 936,350 | ||||||||||||||
| Commercial real estate | 403,397 | 1,445 | 3,924 | — | 408,766 | ||||||||||||||
| Construction and land development | 54,115 | 7,939 | 3,652 | — | 65,706 | ||||||||||||||
| Residential real estate lending | 1,407,720 | — | 9,076 | — | 1,416,796 | ||||||||||||||
| Consumer and other | 188,472 | — | 680 | — | 189,152 | ||||||||||||||
| Total loans | $ | 3,470,870 | $ | 25,181 | $ | 52,603 | $ | 467 | $ | 3,549,121 | |||||||||
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.
| As of and for the Three Months Ended | |||||||||||
| (in thousands) | |||||||||||
| Core operating revenue | |||||||||||
| Net Interest income | $ | 41,844 | $ | 45,655 | $ | 44,689 | |||||
| Non-interest income | 4,000 | 10,040 | 9,118 | ||||||||
| Less: Branch sale loss (gain) (1) | — | — | (1,428 | ) | |||||||
| Less: Securities gain, net | (18 | ) | — | (499 | ) | ||||||
| Core operating revenue | $ | 45,826 | $ | 55,695 | $ | 51,880 | |||||
| Core non-interest expenses | |||||||||||
| Non-interest expense | $ | 32,793 | $ | 32,670 | $ | 32,270 | |||||
| Less: Branch closure expense (2) | — | — | (1,356 | ) | |||||||
| Less: Severance (3) | (1,090 | ) | — | (76 | ) | ||||||
| Core non-interest expense | $ | 31,703 | $ | 32,670 | $ | 30,838 | |||||
| Core net income | |||||||||||
| Net Income (GAAP) | $ | 12,189 | $ | 13,790 | $ | 9,545 | |||||
| Less: Branch sale (gain) (1) | — | — | (1,428 | ) | |||||||
| Less: Securities loss (gain) | (18 | ) | — | (499 | ) | ||||||
| Add: Branch closure expense (2) | — | — | 1,356 | ||||||||
| Add: Severance (3) | 1,090 | — | 76 | ||||||||
| Less: Tax on notable items | (271 | ) | — | 130 | |||||||
| Core net income (non-GAAP) | $ | 12,990 | $ | 13,790 | $ | 9,180 | |||||
| Tangible common equity | |||||||||||
| Stockholders' Equity (GAAP) | $ | 540,222 | $ | 535,821 | $ | 473,269 | |||||
| Less: Minority Interest (GAAP) | (133 | ) | (133 | ) | (134 | ) | |||||
| Less: |
(12,936 | ) | (12,936 | ) | (12,936 | ) | |||||
| Less: Core deposit intangible (GAAP) | (5,057 | ) | (5,358 | ) | (6,386 | ) | |||||
| Tangible common equity (non-GAAP) | $ | 522,096 | $ | 517,394 | $ | 453,813 | |||||
| Average tangible common equity | |||||||||||
| Average Stockholders' Equity (GAAP) | $ | 542,553 | $ | 530,352 | $ | 501,881 | |||||
| Less: Minority Interest (GAAP) | (133 | ) | (133 | ) | (134 | ) | |||||
| Less: |
(12,936 | ) | (12,936 | ) | (12,936 | ) | |||||
| Less: Core deposit intangible (GAAP) | (5,205 | ) | (5,525 | ) | (6,553 | ) | |||||
| Average tangible common equity (non-GAAP) | $ | 524,279 | $ | 511,758 | $ | 482,258 | |||||
| Core return on average assets | |||||||||||
| Core net income (numerator) (non-GAAP) | 12,990 | 13,790 | 9,180 | ||||||||
| Divided: Total average assets (denominator) (GAAP) | 6,231,998 | 6,182,989 | 5,426,863 | ||||||||
| Core return on average assets (non-GAAP) | 0.85 | % | 0.89 | % | 0.68 | % | |||||
| Core return on average tangible common equity | |||||||||||
| Core net income (numerator) (non-GAAP) | 12,990 | 13,790 | 9,180 | ||||||||
| Divided: Average tangible common equity (denominator) (GAAP) | 524,279 | 511,758 | 482,258 | ||||||||
| Core return on average tangible common equity (non-GAAP) | 10.05 | % | 10.72 | % | 7.66 | % | |||||
| Core efficiency ratio | |||||||||||
| Core non-interest expense (numerator) | 31,703 | 32,670 | 30,838 | ||||||||
| Core operating revenue (denominator) | 45,826 | 55,695 | 51,880 | ||||||||
| Core efficiency ratio | 69.18 | % | 58.66 | % | 59.44 | % | |||||
(1) Fixed Asset branch sale in
(2) Occupancy and other expense related to closure of branches during our branch rationalization
(3) Salary and COBRA reimbursement expense for positions eliminated
Source: Amalgamated Financial Corp.