BRYN MAWR, Pa., Oct. 20, 2016 (GLOBE NEWSWIRE) — Bryn Mawr Bank Corporation (NASDAQ:BMTC) (the “Corporation”), parent of The Bryn Mawr Trust Company (the “Bank”), today reported net income of $9.4 million and diluted earnings per share of $0.55 for the three months ended September 30, 2016, as compared to $8.9 million, or $0.52 diluted earnings per share for the three months ended June 30, 2016 and $7.5 million, or $0.42 diluted earnings per share, for the three months ended September 30, 2015.

On a non-GAAP basis, core net income, which excludes certain non-core income and expense items, as detailed in the appendix to this earnings release, was also $9.4 million, or $0.55 diluted earnings per share for the three months ended September 30, 2016 as compared to $9.0 million, or $0.53 diluted earnings per share for the three months ended June 30, 2016 and $8.2 million, or $0.46 diluted earnings per share for the three months ended September 30, 2015. Management believes the core net income measure is important in evaluating the Corporation’s performance on a more comparable basis between periods. A reconciliation of this and other non-GAAP to GAAP performance measures is included in the appendix to this earnings release.

“As we progress through 2016, with the backdrop of a sluggish economy and sustained low-interest rate environment, the Bank continues to perform well,” commented Frank Leto, President and Chief Executive Officer, continuing, “Despite this challenging backdrop, loan growth was strong during the third quarter, helping to offset a lower net interest margin.” Mr. Leto added, “During the first three quarters of this year, in addition to the near ten percent growth of our loan portfolio, we also saw an increase in our wealth assets of close to 20 percent. Both of these trends signal a promising outlook for the remainder of 2016, and we hope to carry this momentum into 2017.”

Mr. Leto also noted, “In addition to these promising trends, we’re also very excited about the successes of several of the strategic initiatives we began last year. Our mortgage banking operation, which began ramping up toward the end of 2014, is now in full swing, with loan volumes up 14.9% for the first nine months of this year compared to the same period last year. Our new loan production office, located in Hershey, Pennsylvania, which has been able to leverage the wealth management relationships we’ve developed there since the 2011 Hershey merger, has seen a ten-fold increase in outstanding balances from $5.2 million as of September 30, 2015 to $52.2 million as of September 30, 2016. And lastly, our non-traditional commercial mortgage subsidiary, headquartered in Media, Pennsylvania, which began operations on October 1, 2015, is progressing well. With outstanding balances as of September 30, 2016 of $19.5 million, from clients in eleven states, we are confident that this specialized arm of the Bank will continue to flourish and produce positive results to our bottom line.”

On October 20, 2016, the Board of Directors of the Corporation declared a quarterly dividend of $0.21 per share, payable December 1, 2016 to shareholders of record as of November 2, 2016.

SIGNIFICANT ITEMS OF NOTE
Results of Operations – Third Quarter 2016 Compared to Second Quarter 2016

  • Net income for the three months ended September 30, 2016 was $9.4 million, as compared to $8.9 million for the three months ended June 30, 2016. Largely accounting for the increase in net income was a $570 thousand decrease in impairment of mortgage servicing rights (“MSR”s), a $576 thousand decrease in salaries and wages, a $311 thousand increase in other operating income and a $464 thousand decrease in income tax expense. These improvements were partially offset by a $967 thousand increase in provision for loan and lease losses (the “Provision”), a $331 thousand decrease in fees for wealth management services and a $463 thousand increase in other operating expense.
     
  • Net interest income for the three months ended September 30, 2016 was $26.7 million, an increase of $90 thousand from $26.6 million for the three months ended June 30, 2016. Average loans and leases for the three months ended September 30, 2016 increased by $64.3 million from the three months ended June 30, 2016, however, the tax-equivalent yield earned on loans decreased by 13 basis points over the same period.
     
  • The tax-equivalent net interest margin of 3.71% for the third quarter of 2016 decreased 10 basis points from 3.81% for the second quarter of 2016. The decrease was primarily the result of a 13 basis point decrease in tax-equivalent yield earned on loans, coupled with a 3 basis point increase in tax-equivalent rate paid on deposits, partially offset by a 2 basis point decrease in rate paid on borrowings. The contribution of fair value mark accretion to the tax-equivalent net interest margin accounted for 9 basis points of the margin for the third quarter of 2016 as compared to 17 basis points for the second quarter of 2016.
     
  • Non-interest income for the three months ended September 30, 2016 increased $72 thousand from the second quarter of 2016. The relatively small increase was related to increases of $311 thousand and $89 thousand in other operating income and gain on sale of loans, respectively, which were offset by a decrease of $331 thousand in fees for wealth management services. The increase in other operating income was largely related to the $237 thousand income recognized as the result of the early pay-off, in full, of a purchased credit-impaired loan which had been discounted at acquisition. The decrease in fees for wealth management services was primarily related to fees for tax services billed in the second quarter of 2016 which did not reoccur in the third quarter.
     
  • Non-interest expense for the three months ended September 30, 2016 decreased $782 thousand, to $25.5 million, as compared to $26.3 million for the second quarter of 2016. The primary contributors to the decrease in noninterest expense during the third quarter were decreases of $576 thousand in salaries and wages, related to reductions in variable compensation accruals, and a decrease of $570 thousand in impairment of MSRs, whose values have stabilized since the impairment recorded in the second quarter of 2016. These decreases in noninterest expense were offset by a $463 thousand increase in other operating expenses, which was largely related to changes in value of deferred compensation liability accounts.  
     
  • For the three months ended September 30, 2016, net loan and lease charge-offs totaled $704 thousand, as compared to $254 thousand for the second quarter of 2016. The Provision for the three months ended September 30, 2016 was $1.4 million, as compared to $445 thousand for the second quarter of 2016. The increased loan volume, along with the increased net charge-offs, necessitated the $967 thousand increase in Provision to bring the allowance for loan and lease losses (the “Allowance”) to the appropriate level.
     
  • Income tax expense for the third quarter of 2016 decreased by $464 thousand as compared to the second quarter of 2016. The reduction in the income tax rate from 35.1% to 31.7% from the second to third quarter of 2016 was the result of the early adoption of FASB Accounting Standards Update (ASU) 2016-09, “Improvements to Employee Share-Based Payment Accounting”. ASU 2016-09 was adopted using a modified retrospective approach, in which the excess tax benefits related to the vesting of employee stock-based compensation are recorded through earnings in the 2016 period in which they occurred. Accordingly, the excess tax benefits recognized in earnings for the first, second and third quarter of 2016 were $47 thousand, $13 thousand and $385 thousand, respectively. The amounts shown in the first and second quarter income statements and balance sheets in the schedules accompanying this earnings release have been adjusted from the amounts previously reported in the earnings releases for first and second quarters of 2016. Prior to the adoption of ASU 2016-09, excess tax benefits associated with employee stock-based compensation were recorded directly to equity, as a component of additional paid-in capital (“APIC”). Accumulated excess tax benefit recorded in APIC for periods prior to 2016 has been reclassified to retained earnings as of January 1, 2016.

Results of Operations – Third Quarter 2016 Compared to Third Quarter 2015

  • Net income for the three months ended September 30, 2016 was $9.4 million, or $0.55 diluted earnings per share, as compared to $7.5 million, or $0.42 diluted earnings per share for the same period in 2015. Contributing to the increase in net income was a $1.9 million increase in net interest income, a $1.0 million reduction in due diligence, merger-related and merger integration costs, and a $300 thousand increase in gain on sale of loans. Partially offsetting these improvements was a $646 thousand increase in other operating expense, a $680 thousand increase in salaries and wages and a $242 thousand increase in Pennsylvania bank shares tax. In addition to the effect of the increased net income, the $0.13 increase in diluted earnings per share was also impacted by the 456,300 shares of Corporation stock repurchased between September 30, 2015 and September 30, 2016 under the stock repurchase program announced on August 6, 2015.
     
  • Net interest income for the three months ended September 30, 2016 was $26.7 million, an increase of $1.9 million, or 7.6%, from $24.8 million for the same period in 2015. The increase in net interest income was primarily related to the growth in average loan balances between the periods. Average loans and leases for the three months ended September 30, 2016 increased by $285.3 million from the same period in 2015. The increase in average loan balances was offset by a 15 basis point decrease in tax-equivalent yield earned on loans and leases. The net effect of the yield decrease and volume increase on average loans and leases was a $2.3 million increase in tax-equivalent interest income on loans. Partially offsetting the increase in average loans was an $84.7 million increase in average interest-bearing deposits accompanied by a 10 basis point increase in rate paid on deposits.
     
  • The tax-equivalent net interest margin of 3.71% for the three months ended September 30, 2016 was a 6 basis point increase from the same period in 2015. The primary reason for the improvement in the margin was the shift in earning assets from low-yielding interest-earning deposits with banks, to much higher yielding loans and investment securities.
     
  • Non-interest income for the three months ended September 30, 2016 increased $542 thousand as compared to the same period in 2015. Contributing to this increase was a $397 thousand increase in other operating income, partially related to the $504 thousand income recognized on deferred compensation trusts, $237 thousand resulting from the pay-off, in full, of a purchased credit-impaired loan which had been recorded at a discount and a $300 thousand increase in gain on sale of loans. Partially offsetting these increases was a $179 thousand decrease in insurance revenues between periods.
     
  • Non-interest expense for the three months ended September 30, 2016 increased $74 thousand, as compared to the same period in 2015. Increases in salaries and wages and other operating expenses of $680 thousand and $646 thousand, respectively, were partially offset by a decrease of $1.0 million in due diligence, merger-related and merger integration expenses. The increase in salaries and wages was related to annual salary increases, new staff additions, and increases in incentive compensation. The increase in other operating expenses was primarily related to a $576 thousand increase in the deferred compensation liability. This increase in the deferred compensation liability is offset by earnings associated with the deferred compensation trusts discussed in the non-interest income section above.
     
  • The Provision for the three months ended September 30, 2016 of $1.4 million was a $212 thousand increase from the same period in 2015. Net loan and lease charge-offs for the third quarter of 2016 increased by $480 thousand from the same period in 2015.

Financial Condition – September 30, 2016 Compared to December 31, 2015

  • Total portfolio loans and leases of $2.49 billion as of September 30, 2016 increased by $224.4 million, or 9.9%, from December 31, 2015. Loan growth was concentrated in the commercial mortgage, commercial and industrial, and construction categories, which increased $125.4 million, $41.0 million and $42.8 million, respectively, since December 31, 2015.
     
  • The Allowance as of September 30, 2016 was $17.7 million, or 0.71% of portfolio loans as compared to $15.9 million, or 0.70% of portfolio loans and leases, as of December 31, 2015. In addition to the ratio of Allowance to portfolio loans, management also calculates two non-GAAP measures: the Allowance as a percentage of originated loans and leases, which was 0.81% as of September 30, 2016, as compared to 0.84% as of December 31, 2015, and the Allowance plus the remaining loan mark as a percentage of gross loans, which was 1.24% as of September 30, 2016, as compared to 1.44% as of December 31, 2015. A reconciliation of these and other non-GAAP to GAAP performance measures is included in the appendix to this earnings release.
     
  • Available for sale investment securities as of September 30, 2016 were $366.9 million, an increase of $17.9 million from December 31, 2015. Increases of $47.8 million in mortgage-related securities were partially offset by decreases of $24.9 million in U.S. government securities and $4.7 million in municipal obligations.
     
  • Total assets as of September 30, 2016 were $3.17 billion, an increase of $143.1 million from December 31, 2015. Increases in loans and leases and available for sale investment securities were partially offset by reductions in interest-bearing deposits with banks, which decreased by $94.5 million.
     
  • Wealth assets under management, administration, supervision and brokerage totaled $9.97 billion as of September 30, 2016, an increase of $1.60 billion, or 19.2%, from December 31, 2015. Despite this growth in assets, income related to these services did not grow proportionately, as a larger percentage of the portfolio was comprised of assets held in lower-yielding fixed-fee accounts. As in prior quarters, the proportion of balances in wealth accounts whose fees are tied to their asset values is decreasing relative to that of fixed-fee accounts. The growth in balances in the market-based accounts, which has resulted from solid new business development and strong account retention, was offset by the normal attrition of funds from these accounts, primarily through beneficiary spending. Additionally, much of the growth in wealth assets during the third quarter of 2016 was experienced in September and, as such, has not impacted the fee revenue line since account billings for the prospective period are based on quarter-end asset balances.
     
  • Deposits of $2.48 billion as of September 30, 2016 increased $225.2 million from December 31, 2015. Noninterest-bearing deposits increased by $91.3 million, retail time deposits and savings deposits increased by $80.3 million and $41.1 million, respectively, and wholesale time deposits increased by $45.9 million. These increases were partially offset by a combined $30.4 million decrease in money market and NOW accounts.
     
  • The capital ratios for the Bank and the Corporation, as of September 30, 2016, as shown in the attached tables, indicate levels well above the regulatory minimum to be considered “well capitalized.” At the Bank level, all capital ratios have increased from their June 30, 2016 levels, primarily due to increases in retained earnings, other comprehensive income and the $15.0 million capital infusion received from the Corporation in the first quarter of 2016. At the Corporation level, most capital levels remain below their December 31, 2015 levels largely due to asset growth.

FORWARD LOOKING STATEMENTS AND SAFE HARBOR
This press release contains statements which, to the extent that they are not recitations of historical fact may constitute forward-looking statements for purposes of the Securities Act of 1933, as amended, and the Securities Exchange Act of 1934, as amended. Such forward-looking statements may include financial and other projections as well as statements regarding the Corporation’s future plans, objectives, performance, revenues, growth, profits, operating expenses or the Corporation’s underlying assumptions. The words “may,”  “would,” “should,” “could,” “will,” “likely,” “possibly,” “expect,” “anticipate,” “intend,” “indicate,” “estimate,” “target,” “potentially,” “promising,” “probably,” “outlook,” “predict,” “contemplate,” “continue,” “plan,” “forecast,” “project,” “are optimistic,” “are looking,” “are looking forward” and “believe” or other similar words and phrases may identify forward-looking statements. Persons reading this press release are cautioned that such statements are only predictions, and that the Corporation’s actual future results or performance may be materially different.

Such forward-looking statements involve known and unknown risks and uncertainties.   A number of factors, many of which are beyond the Corporation’s control, could cause our actual results, events or developments, or industry results, to be materially different from any future results, events or developments expressed, implied or anticipated by such forward-looking statements, and so our business and financial condition and results of operations could be materially and adversely affected. Such factors include, among others, that the integration of acquired businesses with the Corporation’s may take longer than anticipated or be more costly to complete and that the anticipated benefits, including any anticipated cost savings or strategic gains may be significantly harder to achieve or take longer than anticipated or may not be achieved, our need for capital, our ability to control operating costs and expenses, and to manage loan and lease delinquency rates; the credit risks of lending activities and overall quality of the composition of our loan, lease and securities portfolio; the impact of economic conditions, consumer and business spending habits, and real estate market conditions on our business and in our market area; changes in the levels of general interest rates, deposit interest rates, or net interest margin and funding sources; changes in banking regulations and policies and the possibility that any banking agency approvals we might require for certain activities will not be obtained in a timely manner or at all or will be conditioned in a manner that would impair our ability to implement our business plans; changes in accounting policies and practices; the inability of key third-party providers to perform their obligations to us; our ability to attract and retain key personnel; competition in our marketplace; war or terrorist activities; material differences in the actual financial results, cost savings and revenue enhancements associated with our acquisitions; and other factors as described in our securities filings.  All forward-looking statements and information set forth herein are based on management’s current beliefs and assumptions as of the date hereof and speak only as of the date they are made.  The Corporation does not undertake to update forward-looking statements.

For a complete discussion of the assumptions, risks and uncertainties related to our business, you are encouraged to review our filings with the Securities and Exchange Commission, including our most recent Annual Report on Form 10-K, as updated by our quarterly or other reports subsequently filed with the SEC.

Bryn Mawr Bank Corporation                        
Summary Financial Information (unaudited)                        
(dollars in thousands, except per share data)                              
  As of or For the Three Months Ended   For the Nine Months Ended    
  September 30, 2016   June 30, 2016   March 31, 2016   December 31, 2015   September 30, 2015   September 30, 2016   September 30, 2015    
Consolidated Balance Sheet (selected items)                                                          
Interest-bearing deposits with banks $   30,118     $   20,481     $   33,954     $   124,615     $   100,980              
Investment securities (AFS, HTM and Trading)     373,508         371,906         369,461         352,916         344,872              
Loans held for sale     11,506         11,882         7,807         8,987         8,721              
Portfolio loans and leases     2,493,357         2,423,821         2,378,841         2,268,988         2,228,764              
Allowance for loan and lease losses (“ALLL”)     (17,744 )       (17,036 )       (16,845 )       (15,857 )       (15,935 )            
Goodwill and other intangible assets     126,000         126,888         127,777         128,668         129,694              
Total assets     3,174,080         3,090,090         3,058,247         3,030,997         2,952,742              
Deposits – interest-bearing     1,759,862         1,720,477         1,700,550         1,626,041         1,634,237              
Deposits – non-interest-bearing     718,015         689,214         643,492         626,684         605,607              
Short-term borrowings     50,065         19,119         37,010         94,167         24,264              
Long-term FHLB advances and other borrowings     204,772         224,802         249,832         254,863         254,893              
Subordinated notes     29,518         29,505         29,491         29,479         29,466              
Total liabilities     2,795,621         2,717,623         2,693,070         2,665,286         2,584,587              
Shareholders’ equity     378,459         372,467         365,177         365,711         368,155              
                         
Average Balance Sheet (selected items)                        
Interest-bearing deposits with banks $   33,532     $   44,950     $   39,050     $   90,832     $   165,723     $   39,157     $   184,689      
Investment securities (AFS, HTM and Trading)     373,616         371,153         360,957         354,239         356,028         368,594         367,302      
Loans held for sale     12,887         7,844         5,481         7,531         10,527         8,752         6,936      
Portfolio loans and leases     2,464,085         2,404,799         2,303,103         2,240,189         2,181,125         2,390,931         2,124,342      
Total interest-earning assets     2,884,120         2,828,746         2,708,591         2,692,791         2,713,403         2,807,434         2,683,269      
Goodwill and intangible assets     126,505         127,402         128,296         129,292         130,241         127,398         127,806      
Total assets     3,142,019         3,089,953         2,973,148         2,959,011         2,981,308         3,068,643         2,936,953      
Deposits – interest-bearing     1,729,689         1,717,252         1,633,651         1,611,574         1,644,976         1,693,663         1,644,632      
Short-term borrowings     40,966         32,328         34,158         26,092         28,166         35,836         39,352      
Long-term FHLB advances and other borrowings     218,920         236,248         250,015         254,880         248,606         235,002         254,810      
Subordinated notes     29,509         29,496         29,482         29,471         18,190         29,496         6,130      
Total interest-bearing liabilities     2,019,084         2,015,324         1,947,306         1,922,017         1,939,938         1,993,997         1,944,924      
Total liabilities     2,769,065         2,723,838         2,612,276         2,593,651         2,604,704         2,701,973         2,561,258      
Shareholders’ equity     372,954         366,115         360,872         365,360         376,604         366,669         375,695      
                         
Income Statement                        
Net interest income $   26,717     $   26,627     $   25,902     $   25,429     $   24,833     $   79,246     $   74,698      
Provision for loan and lease losses     1,412         445         1,410         1,777         1,200         3,267         2,619      
Noninterest income     13,892         13,820         13,208         13,668         13,350         40,920         42,292      
Noninterest expense     25,477         26,259         25,051         46,951         25,403         76,787         78,814      
Income tax expense (benefit)     4,346         4,810         4,328         (3,276 )       4,084         13,484         12,448      
Net income (loss)     9,374         8,933         8,321         (6,355 )       7,496         26,628         23,109      
Basic earnings per share     0.56         0.53         0.49         (0.37 )       0.43         1.58         1.31      
Diluted earnings per share     0.55         0.52         0.49         (0.37 )       0.42         1.57         1.29      
Net income (core) (1)     9,392         8,961         8,331         7,506         8,241         26,684         26,008      
Basic earnings per share (core) (1)     0.56         0.53         0.49         0.44         0.47         1.58         1.48      
Diluted earnings per share (core) (1)     0.55         0.53         0.49         0.44         0.46         1.57         1.45      
Cash dividends paid per share     0.21         0.20         0.20         0.20         0.20         0.61         0.58      
Profitability Indicators                        
Return on average assets   1.19 %     1.16 %     1.13 %     -0.86 %     1.01 %     1.16 %     1.05 %    
Return on average equity   10.00 %     9.81 %     9.27 %     -7.00 %     8.01 %     9.70 %     8.22 %    
Return on tangible equity(1)   16.06 %     16.02 %     15.39 %     -9.36 %     13.25 %     15.83 %     13.48 %    
Tax-equivalent net interest margin   3.71 %     3.81 %     3.87 %     3.77 %     3.65 %     3.79 %     3.75 %    
Efficiency ratio(1)   60.51 %     62.66 %     61.75 %     63.09 %     60.97 %     61.64 %     60.79 %    
Mortgage Banking Information                        
Mortgage loans originated $   84,885     $   64,893     $   51,532     $   55,867     $   76,169     $   201,310     $   175,182      
Residential mortgage loans sold – servicing retained     40,462         26,944         25,965         24,063         30,515         93,371         83,288      
Residential mortgage loans sold – servicing released     10,522         5,278         2,397         7,150         10,579         18,197         22,480      
Total residential mortgage loans sold $   50,984     $   32,222     $   28,362     $   31,213     $   41,094     $   111,568     $   105,768      
Residential mortgage loans serviced for others $   618,134     $   610,418     $   605,366     $   601,939     $   601,999              
Share Data                        
Closing share price $   31.99     $   29.20     $   25.73     $   28.72     $   31.07              
Book value per common share $   22.08     $   21.76     $   21.48     $   21.40     $   21.94              
Tangible book value per common share $   14.94     $   14.60     $   14.13     $   13.89     $   13.89              
Price / book value   144.91 %     134.19 %     119.80 %     134.19 %     141.62 %            
Price / tangible book value   214.07 %     200.05 %     182.10 %     206.84 %     223.67 %            
Weighted average diluted shares outstanding   17,072,358       17,027,419       16,883,364       17,129,234         17,834,298         16,994,455         17,930,420      
Shares outstanding, end of period   16,893,878       16,824,564       16,801,801        17,071,523         17,166,323              
Wealth Management Information:                        
                                                   
Wealth assets under mgmt, administration, supervision and brokerage (2) $   9,969,745     $   9,632,521     $   9,281,743     $   8,364,805     $   8,218,276              
Fees for wealth management services $   9,100     $   9,431     $   8,832     $   8,995     $   9,194              
                         
Capital Ratios                        
Bryn Mawr Trust Company                        
Tier I capital to risk weighted assets (“RWA”)   11.01 %     10.94 %     10.69 %     10.12 %     11.96 %            
Total (Tier II) capital to RWA   11.72 %     11.65 %     11.39 %     10.78 %     12.64 %            
Tier I leverage ratio   9.17 %     9.06 %     9.15 %     8.51 %     9.75 %            
Tangible equity ratio (1)   8.86 %     8.79 %     8.53 %     7.74 %     8.84 %            
Common equity Tier I capital to RWA   11.01 %     10.94 %     10.69 %     10.12 %     11.96 %            
                         
Bryn Mawr Bank Corporation                        
Tier I capital to RWA   10.42 %     10.45 %     10.22 %     10.72 %     11.56 %            
Total (Tier II) capital to RWA   12.31 %     12.35 %     12.13 %     12.61 %     13.50 %            
Tier I leverage ratio   8.69 %     8.65 %     8.76 %     9.02 %     9.44 %            
Tangible equity ratio (1)   8.28 %     8.29 %     8.10 %     8.17 %     8.45 %            
Common equity Tier I capital to RWA   10.42 %     10.45 %     10.22 %     10.72 %     11.56 %            
                         
Asset Quality Indicators                        
                         
Net loan and lease charge-offs (“NCO”s) $   704     $   254     $   422     $   1,855     $   224     $   1,380     $   1,270      
Nonperforming loans and leases (“NPL”s) $   9,883     $   9,617     $   9,636     $   10,244     $   12,315              
Other real estate owned (“OREO”)     867         784         756         2,638         1,010              
Total nonperforming assets (“NPA”s) $    10,750     $    10,401     $    10,392     $    12,882     $    13,325              
                         
Nonperforming loans and leases 30 or more days past due $   4,339     $   5,599     $   6,193     $   5,678     $   8,854              
Performing loans and leases 30 to 89 days past due     2,491         3,564         6,296         5,601         4,960              
Performing loans and leases 90 or more days past due     –         –         –         –         –              
Total delinquent loans and leases $    6,830     $    9,163     $    12,489     $    11,279     $    13,814              
                         
Delinquent loans and leases to total loans and leases   0.27 %     0.38 %     0.52 %     0.50 %     0.62 %            
Delinquent performing loans and leases to total loans and leases   0.10 %     0.15 %     0.26 %     0.25 %     0.22 %            
NCOs / average loans and leases (annualized)   0.11 %     0.04 %     0.07 %     0.33 %     0.04 %     0.08 %     0.08 %    
NPLs / total portfolio loans and leases   0.40 %     0.40 %     0.41 %     0.45 %     0.55 %            
NPAs / total loans and leases and OREO   0.43 %     0.43 %     0.44 %     0.56 %     0.60 %            
ALLL / NPLs   179.54 %     177.14 %     174.81 %     154.79 %     129.40 %            
ALLL / portfolio loans   0.71 %     0.70 %     0.71 %     0.70 %     0.71 %            
ALLL on originated loans and leases / Originated loans and leases (1)   0.81 %     0.81 %     0.83 %     0.84 %     0.88 %            
(Total Allowance + Loan mark) / Total Gross portfolio loans and leases (1)   1.24 %     1.30 %     1.37 %     1.44 %     1.52 %            
                         
Troubled debt restructurings (“TDR”s) included in NPLs $   1,680     $   1,779     $   1,756     $   1,935     $   3,711              
TDRs in compliance with modified terms     6,305         4,984         4,893         4,880         4,062              
Total TDRs $    7,985     $    6,763     $    6,649     $    6,815     $    7,773              
                         
(1)Non-GAAP measure – see Appendix for Non-GAAP to GAAP reconciliation. 
(2)Brokerage assets represent assets held at a registered broker dealer under a clearing agreement.
 

Bryn Mawr Bank Corporation                          
Detailed Balance Sheets (unaudited)                          
(dollars in thousands)                          
                           
  September 30, 2016   June 30, 2016   March 31, 2016   December 31, 2015   September 30, 2015        
Assets                          
Cash and due from banks $ 18,905     $ 13,710     $ 15,594     $ 18,452     $ 17,161          
Interest-bearing deposits with banks   30,118       20,481       33,954       124,615       100,980          
Cash and cash equivalents   49,023       34,191       49,548       143,067       118,141          
Investment securities, available for sale   366,910       365,470       365,819       348,966       341,421          
Investment securities, held to maturity   2,896       2,915                            
Investment securities, trading   3,702       3,521       3,642       3,950       3,451          
Loans held for sale   11,506       11,882       7,807       8,987       8,721          
Portfolio loans and leases, originated   2,176,549       2,090,070       2,015,683       1,883,869       1,804,834          
Portfolio loans and leases, acquired   316,808       333,751       363,158       385,119       423,930          
Total portfolio loans and leases   2,493,357       2,423,821       2,378,841       2,268,988       2,228,764          
Less: Allowance for losses on originated loan and leases   (17,716 )     (17,008 )     (16,817 )     (15,857 )     (15,900 )        
Less: Allowance for losses on acquired loan and leases   (28 )     (28 )     (28 )           (35 )        
Total allowance for loan and lease losses   (17,744 )     (17,036 )     (16,845 )     (15,857 )     (15,935 )        
Net portfolio loans and leases   2,475,613       2,406,785       2,361,996       2,253,131       2,212,829          
Premises and equipment   42,559       43,607       44,712       45,339       44,370          
Accrued interest receivable   8,066       8,144       8,205       7,869       7,744          
Mortgage servicing rights   4,793       4,646       5,182       5,142       5,031          
Bank owned life insurance   39,055       38,836       38,616       38,371       38,157          
Federal Home Loan Bank (“FHLB”) stock   13,185       10,618       12,142       12,942       11,742          
Goodwill   104,765       104,765       104,765       104,765       104,338          
Intangible assets   21,235       22,123       23,012       23,903       25,356          
Other investments   9,121       8,722       8,487       9,460       9,499          
Other assets   21,651       23,865       24,314       25,105       21,942          
Total assets $ 3,174,080     $ 3,090,090     $ 3,058,247     $ 3,030,997     $ 2,952,742          
                                               
Liabilities                                              
Deposits                                              
Noninterest-bearing $ 718,015     $ 689,214     $ 643,492     $ 626,684     $ 605,607          
Interest-bearing   1,759,862       1,720,477       1,700,550       1,626,041       1,634,237          
Total deposits   2,477,877       2,409,691       2,344,042       2,252,725       2,239,844          
Short-term borrowings   50,065       19,119       37,010       94,167       24,264          
Long-term FHLB advances and other borrowings   204,772       224,802       249,832       254,863       254,893          
Subordinated notes   29,518       29,505       29,491       29,479       29,466          
Accrued interest payable   1,854       1,846       1,294       1,851       1,444          
Other liabilities   31,535       32,660       31,401       32,201       34,676          
Total liabilities   2,795,621       2,717,623       2,693,070       2,665,286       2,584,587          
                           
Shareholders’ equity                          
Common stock   21,064       20,972       20,949       20,931       20,854          
Paid-in capital in excess of par value   227,708       230,298       229,432       228,814       226,980          
Less: common stock held in treasury, at cost   (66,895 )     (66,200 )     (66,140 )     (58,144 )     (53,000 )        
Accumulated other comprehensive income (loss), net of tax   2,128       2,488       1,502       (412 )     (11,040 )        
Retained earnings   194,454       184,909       179,434       174,522       184,361          
Total shareholders equity   378,459       372,467       365,177       365,711       368,155          
Total liabilities and shareholders’ equity $ 3,174,080     $ 3,090,090     $ 3,058,247     $ 3,030,997     $ 2,952,742          
                                               

 

Bryn Mawr Bank Corporation                          
Supplemental Balance Sheet Information (unaudited)                          
(dollars in thousands)                          
  Portfolio Loans and Leases as of        
  September 30, 2016   June 30, 2016   March 31, 2016   December 31, 2015   September 30, 2015        
Commercial mortgages $ 1,089,621     $ 1,055,934     $ 1,044,415     $ 964,259     $ 971,983          
Home equity loans and lines   206,578       202,989       205,896       209,473       212,258          
Residential mortgages   418,408       414,863       412,006       406,404       399,730          
Construction     133,269         133,313         119,193         90,421         82,820          
Total real estate loans   1,847,876       1,807,099       1,781,510       1,670,557       1,666,791          
Commercial & Industrial   565,497       538,684       523,053       524,515       488,977          
Consumer   23,717       21,561       21,427       22,129       22,350          
Leases     56,267         56,477         52,851         51,787         50,646          
Total non-real estate loans and leases     645,481         616,722         597,331         598,431         561,973          
Total portfolio loans and leases $   2,493,357     $   2,423,821     $   2,378,841     $   2,268,988     $   2,228,764          
                           
                           
  Nonperforming Loans and Leases as of        
  September 30, 2016   June 30, 2016   March 31, 2016   December 31, 2015   September 30, 2015        
Commercial mortgages $ 139     $ 139     $ 872     $ 829     $ 931          
Home equity loans and lines   2,827       3,011       1,953       2,027       1,661          
Residential mortgages   2,845       2,909       2,923       3,212       5,249          
Construction     –         –         12         34         34          
Total nonperforming real estate loans   5,811       6,059       5,760       6,102       7,875          
Commercial & Industrial   3,960       3,457       3,822       4,133       4,337          
Consumer   2       4                   2          
Leases     110         97         54         9         101          
Total nonperforming non-real estate loans and leases     4,072         3,558         3,876         4,142         4,440          
Total nonperforming portfolio loans and leases $   9,883     $   9,617     $   9,636     $   10,244     $   12,315          
                           
                           
  Net Loan and Lease Charge-Offs (Recoveries) for the Three Months Ended        
  September 30, 2016   June 30, 2016   March 31, 2016   December 31, 2015   September 30, 2015        
Commercial mortgage $ (4 )   $ (3 )   $ 107     $ (4 )   $          
Home equity loans and lines   375       11       71       561       (21 )        
Residential   2       262       (35 )     239       11          
Construction     –         (62 )       –         (1 )       (1 )        
Total net charge-offs (recoveries) of real estate loans   373       208       143       795       (11 )        
Commercial & Industrial   95       (44 )     25       902       38          
Consumer   58       30       20       55       26          
Leases     178         60         234         103         171          
Total net charge-offs of non-real estate loans and leases     331         46         279         1,060         235          
Total net charge-offs $   704     $   254     $   422     $   1,855     $   224          
                           

Bryn Mawr Bank Corporation                        
Supplemental Balance Sheet Information (unaudited)                        
(dollars in thousands)                        
  Investment Securities Available for Sale, at Fair Value      
  September 30, 2016   June 30, 2016   March 31, 2016   December 31, 2015   September 30, 2015      
U.S. Treasury securities $ 101     $ 102     $ 102     $ 101     $ 102        
Obligations of the U.S. Government and agencies   76,598       86,134       96,080       101,495       91,639        
State & political subdivisions – tax-free   36,735       39,047       39,502       41,442       43,388        
State & political subdivisions – taxable   529       532       1,093       524       742        
Mortgage-backed securities   184,919       186,354       183,127       158,689       155,509        
Collateralized mortgage obligations   51,344       36,702       29,106       29,799       32,953        
Other debt securities   1,450       1,450       1,700       1,691       1,896        
Bond mutual funds   11,847       11,774       11,725       11,810       11,798        
Other investments     3,387         3,375         3,384         3,415         3,394        
Total $   366,910     $   365,470     $   365,819     $   348,966     $   341,421        
                         
                         
  Unrealized Gain (Loss) on Investment Securities Available for Sale      
  September 30, 2016   June 30, 2016   March 31, 2016   December 31, 2015   September 30, 2015      
U.S. Treasury securities $     $ 1     $ 1     $     $ 1        
Obligations of the U.S. Government and agencies   946       1,183       984       153       712        
State & political subdivisions – tax-free   131       240       173       75       153        
State & political subdivisions – taxable   5       8       18       (1 )     2        
Mortgage-backed securities   3,801       3,958       3,026       1,267       2,591        
Collateralized mortgage obligations   253       496       330       43       339        
Other debt securities                     (9 )     (4 )      
Bond mutual funds   (109 )     (182 )     (231 )     (146 )     (158 )      
Other investments     34         (66 )       (155 )       (192 )       (193 )      
Total $   5,061     $   5,638     $   4,146     $   1,190     $   3,443        
                         
                         
  Deposits      
  September 30, 2016   June 30, 2016   March 31, 2016   December 31, 2015   September 30, 2015      
Interest-bearing deposits:                        
Interest-bearing checking $ 333,055     $ 333,425     $ 335,240     $ 338,861     $ 330,683        
Money market   725,116       718,144       773,637       749,726       748,983        
Savings   228,391       217,877       190,477       187,299       192,995        
Wholesale non-maturity deposits   64,664       58,690       62,454       67,717       65,636        
Wholesale time deposits   99,052       113,274       131,145       53,185       57,671        
Retail time deposits     309,584         279,067         207,597         229,253         238,269        
Total interest-bearing deposits   1,759,862       1,720,477       1,700,550       1,626,041       1,634,237        
Noninterest-bearing deposits     718,015         689,214         643,492         626,684         605,607        
Total deposits $   2,477,877     $   2,409,691     $   2,344,042     $   2,252,725     $   2,239,844        
                         

Bryn Mawr Bank Corporation                              
Detailed Income Statements (unaudited)                              
(dollars in thousands, except per share data)                              
  For the Three Months Ended   For the Nine Months Ended    
  September 30, 2016   June 30, 2016   March 31, 2016   December 31, 2015   September 30, 2015   September 30, 2016   September 30, 2015    
Interest income:                              
Interest and fees on loans and leases $ 27,931     $ 27,679     $ 26,696     $ 26,080     $ 25,620     $ 82,306     $ 76,352      
Interest on cash and cash equivalents   27       42       46       63       107       115       346      
Interest on investment securities:     1,556         1,565         1,527         1,623         1,302         4,648         4,078      
Total interest income     29,514         29,286         28,269         27,766         27,029         87,069         80,776      
Interest expense:                              
Interest on deposits   1,575       1,402       1,076       1,046       1,076       4,053       3,166      
Interest on short-term borrowings   34       20       17       9       8       71       39      
Interest on FHLB advances and other borrowings   818       867       908       912       881       2,593       2,642      
Interest on subordinated notes     370         370         366         370         231         1,106         231      
Total interest expense     2,797         2,659         2,367         2,337         2,196         7,823         6,078      
Net interest income   26,717       26,627       25,902       25,429       24,833       79,246       74,698      
Provision for loan and lease losses (the “Provision”)     1,412         445         1,410         1,777         1,200         3,267         2,619      
Net interest income after Provision   25,305       26,182       24,492       23,652       23,633       75,979       72,079      
Noninterest income:                              
Fees for wealth management services   9,100       9,431       8,832       8,995       9,194       27,363       27,899      
Insurance revenue   886       845       1,276       842       1,065       3,007       2,903      
Service charges on deposits   688       713       702       742       721       2,103       2,185      
Loan servicing and other fees   497       539       492       502       397       1,528       1,585      
Net gain on sale of loans   985       896       760       751       685       2,641       2,271      
Net (loss) gain on sale of investment securities available for sale   (28 )     (43 )     (15 )     58       60       (86 )     873      
Net (loss) gain on sale of other real estate owned               (76 )     33             (76 )     90      
Dividends on FHLB and FRB stocks   277       263       214       330       138       754       1,052      
Other operating income     1,487         1,176         1,023         1,415         1,090         3,686         3,434      
Total noninterest income   13,892       13,820       13,208       13,668       13,350       40,920       42,292      
Noninterest expense:                              
Salaries and wages   11,621       12,197       11,738       11,700       10,941       35,556       32,875      
Employee benefits   2,420       2,436       2,485       2,268       2,590       7,341       7,937      
Loss on pension termination                     17,377                        
Occupancy and bank premises   2,349       2,367       2,488       2,474       2,557       7,204       7,831      
Branch lease termination expense                     929                        
Furniture, fixtures and equipment   1,837       1,895       1,919       2,129       1,712       5,651       4,712      
Advertising   334       372       284       656       410       990       1,446      
Amortization of intangible assets   888       889       891       937       953       2,668       2,890      
Impairment of intangible assets                     387                        
Impairment (recovery) of mortgage servicing rights (“MSRs”)   29       599       83       (17 )     36       711       87      
Due diligence, merger-related and merger integration expenses                     1,860       1,015             4,810      
Professional fees   937       946       813       1,010       843       2,696       2,343      
Pennsylvania bank shares tax   675       640       638       (46 )     433       1,953       1,299      
Information technology   881       875       1,048       874       1,053       2,804       2,569      
Other operating expenses     3,506         3,043         2,664         4,413         2,860         9,213         10,015      
Total noninterest expense   25,477       26,259       25,051       46,951       25,403       76,787       78,814      
Income (loss) before income taxes   13,720       13,743       12,649       (9,631 )     11,580       40,112       35,557      
Income tax expense (benefit)     4,346         4,810         4,328         (3,276 )       4,084         13,484         12,448      
Net income (loss) $   9,374     $   8,933     $   8,321     $   (6,355 )   $   7,496     $   26,628     $   23,109      
Per share data:                              
Weighted average shares outstanding   16,860,727       16,812,219       16,848,202       17,129,234       17,572,421       16,840,457       17,610,353      
Dilutive common shares     211,631         215,200         35,162         –         261,877         153,998         320,067      
Adjusted weighted average diluted shares   17,072,358       17,027,419       16,883,364       17,129,234       17,834,298       16,994,455       17,930,420      
Basic earnings (loss) per common share $ 0.56     $ 0.53     $ 0.49     $ (0.37 )   $ 0.43     $ 1.58     $ 1.31      
Diluted earnings (loss) per common share $ 0.55     $ 0.52     $ 0.49     $ (0.37 )   $ 0.42     $ 1.57     $ 1.29      
Dividend declared per share $ 0.21     $ 0.20     $ 0.20     $ 0.20     $ 0.20     $ 0.61     $ 0.58      
Effective tax rate   31.68 %     35.09 %     34.59 %     34.02 %     35.27 %     33.62 %     35.01 %    
                               
                               

 

 

Bryn Mawr Bank Corporation
Tax-Equivalent Net Interest Margin (unaudited)
(dollars in thousands, except per share data)
    For The Three Months Ended   For The Nine Months Ended
    September 30, 2016 June 30, 2016 March 31, 2016 December 31, 2015 September 30, 2015   September 30, 2016 September 30, 2015
(dollars in thousands)   Average Balance Interest Income/ Expense Average Rates Earned/ Paid Average Balance Interest Income/ Expense Average Rates Earned/ Paid Average Balance Interest Income/ Expense Average Rates Earned/ Paid Average Balance Interest Income/ Expense Average Rates Earned/ Paid Average Balance Interest Income/ Expense Average Rates Earned/ Paid   Average Balance Interest Income/ Expense Average Rates Earned/ Paid Average Balance Interest Income/ Expense Average Rates Earned/ Paid
                                               
Assets:                                              
Interest-bearing deposits with other banks   $ 33,532   $ 27     0.32 % $ 44,950   $ 42     0.38 % $ 39,050   $ 46     0.47 % $ 90,832   $ 63     0.28 % $ 165,723   $ 107     0.26 %   $ 39,157   $ 115     0.39 % $ 184,689   $ 346     0.25 %
Investment securities – available for sale:                                              
Taxable     329,293     1,423     1.72 %   325,893     1,433     1.77 %   316,353     1,397     1.78 %   307,524     1,432     1.85 %   310,582     1,172     1.50 %     323,866     4,263     1.76 %   318,510     3,691     1.55 %
Tax-exempt     37,893     189     1.98 %   39,193     187     1.92 %   40,658     191     1.89 %   43,144     195     1.79 %   41,424     186     1.78 %     39,243     567     1.93 %   37,871     546     1.93 %
Total investment securities – available for sale     367,186     1,612     1.75 %   365,086     1,620     1.78 %   357,011     1,588     1.79 %   350,668     1,627     1.84 %   352,006     1,358     1.53 %     363,109     4,830     1.78 %   356,381     4,237     1.59 %
                                               
Investment securities  – held to maturity     2,907     6     0.82 %   2,427     4     0.66 %                     0.00 %               1,782     4     0.30 %          
Investment securities  – trading     3,523     2     0.23 %   3,640     2     0.22 %   3,946     2     0.20 %   3,571     60     6.67 %   4,022     5     0.49 %     3,703     2     0.07 %   3,985     21     0.70 %
                                               
Loans and leases *     2,476,972     28,032     4.50 %   2,412,643     27,761     4.63 %   2,308,584     26,778     4.67 %   2,247,720     26,158     4.62 %   2,191,652     25,698     4.65 %     2,399,683     82,571     4.60 %   2,131,278     76,548     4.80 %
                                               
Total interest-earning assets     2,884,120     29,679     4.09 %   2,828,746     29,429     4.18 %   2,708,591     28,414     4.22 %   2,692,791     27,908     4.11 %   2,713,403     27,168     3.97 %     2,807,434     87,522     4.16 %   2,676,333     81,152     4.05 %
                                               
Cash and due from banks     16,228         16,413         16,501         18,005         17,160           16,380         17,484      
Less: allowance for loan and lease losses     (17,257 )       (17,271 )       (16,239 )       (16,106 )       (15,066 )         (16,924 )       (14,760 )    
Other assets     258,928         262,065         264,295         264,321         265,811           261,753         257,896      
                                               
    Total assets   $ 3,142,019       $ 3,089,953       $ 2,973,148       $ 2,959,011       $ 2,981,308         $ 3,068,643       $ 2,936,953      
                                               
Liabilities:                                              
                                               
Interest-bearing deposits:                                              
Savings, NOW and market rate deposits   $ 1,286,404   $ 641     0.20 % $ 1,273,964   $ 589     0.19 % $ 1,279,630   $ 569     0.18 % $ 1,260,575   $ 565     0.18 % $ 1,260,529   $ 584     0.18 %   $ 1,280,023   $ 1,799     0.19 % $ 1,245,857   $ 1,753     0.19 %
Wholesale deposits     164,706     327     0.79 %   196,517     361     0.74 %   137,201     233     0.68 %   119,394     186     0.62 %   133,277     203     0.60 %     166,136     921     0.74 %   134,607     586     0.58 %
Retail time deposits     278,579     607     0.87 %   246,771     452     0.74 %   216,820     274     0.51 %   231,605     295     0.51 %   251,170     289     0.46 %     247,504     1,333     0.72 %   264,168     827     0.42 %
Total interest-bearing deposits     1,729,689     1,575     0.36 %   1,717,252     1,402     0.33 %   1,633,651     1,076     0.26 %   1,611,574     1,046     0.26 %   1,644,976     1,076     0.26 %     1,693,663     4,053     0.32 %   1,644,632     3,166     0.26 %
                                               
Borrowings:                                              
Short-term borrowings     40,966     34     0.33 %   32,328     20     0.25 %   34,158     17     0.20 %   26,092     9     0.14 %   28,166     8     0.11 %     35,836     71     0.26 %   39,352     39     0.13 %
Long-term FHLB advances and other borrowings     218,920     818     1.49 %   236,248     867     1.48 %   250,015     908     1.46 %   254,880     912     1.42 %   248,606     881     1.41 %     235,002     2,593     1.47 %   254,810     2,642     1.39 %
Subordinated notes     29,509     370     4.99 %   29,496     370     5.05 %   29,482     366     4.99 %   29,471     370     4.98 %   18,190     231     5.04 %     29,496     1,106     5.01 %   6,130     231     5.04 %
Total borrowings     289,395     1,222     1.68 %   298,072     1,257     1.70 %   313,655     1,291     1.66 %   310,443     1,291     1.65 %   294,962     1,120     1.51 %     300,334     3,770     1.68 %   300,292     2,912     1.30 %
                                               
Total interest-bearing liabilities     2,019,084     2,797     0.55 %   2,015,324     2,659     0.53 %   1,947,306     2,367     0.49 %   1,922,017     2,337     0.48 %   1,939,938     2,196     0.45 %     1,993,997     7,823     0.52 %   1,944,924     6,078     0.42 %
                                               
Noninterest-bearing deposits     716,581         675,710         631,047         634,969         625,547           674,601         580,356      
Other liabilities     33,400         32,804         33,923         36,665         39,219           33,375         35,978      
Total noninterest-bearing liabilities     749,981         708,514         664,970         671,634         664,766           707,976         616,334      
                                               
Total liabilities     2,769,065         2,723,838         2,612,276         2,593,651         2,604,704           2,701,973         2,561,258      
                                               
Shareholders’ equity     372,954         366,115         360,872         365,360         376,604           366,669         375,695      
                                               
Total liabilities and shareholders’ equity   $ 3,142,019       $ 3,089,953       $ 2,973,148       $ 2,959,011       $ 2,981,308         $ 3,068,642       $ 2,936,953      
                                               
Interest income to earning assets         4.09 %       4.18 %       4.22 %       4.11 %       3.97 %         4.16 %       4.05 %
                                               
Net interest spread         3.54 %       3.65 %       3.73 %       3.63 %       3.52 %         3.64 %       3.63 %
Effect of noninterest-bearing sources         0.17 %       0.16 %       0.14 %       0.14 %       0.13 %         0.15 %       0.12 %
                                               
Tax-equivalent net interest margin     $ 26,882     3.71 %   $ 26,770     3.81 %   $ 26,047     3.87 %   $ 25,571     3.77 %   $ 24,972     3.65 %     $ 79,699     3.79 %   $ 75,074     3.75 %
                                               
Tax-equivalent adjustment     $   165     0.02 %   $   143     0.02 %   $   145     0.02 %   $   142     0.02 %   $   139     0.02 %     $   453     0.02 %   $   376     0.02 %
                                               
Supplemental Information Regarding Accretion of Fair Value Marks
      Interest Income (Expense) Effect Effect on Yield or Rate   Interest Income (Expense) Effect Effect on Yield or Rate   Interest Income (Expense) Effect Effect on Yield or Rate   Interest Income (Expense) Effect Effect on Yield or Rate   Interest Income (Expense) Effect Effect on Yield or Rate     Interest Income (Expense) Effect Effect on Yield or Rate   Interest Income (Expense) Effect Effect on Yield or Rate
Loans and leases     $ 578     0.09 %   $ 1,076     0.18 %   $ 953     0.17 %   $ 707     0.12 %   $ 763     0.14 %     $ 2,607     0.15 %   $ 3,136     0.20 %
Retail time deposits       (29 )   -0.04 %     (61 )   -0.10 %     (110 )   -0.20 %     (123 )   -0.21 %     (188 )   -0.30 %       (200 )   -0.11 %     (638 )   -0.32 %
Short-term borrowings           0.00 %         0.00 %     (12 )   -0.14 %     (35 )   -0.53 %     (35 )   -0.49 %       (12 )   -0.04 %     (104 )   -0.35 %
Long-term FHLB advances and other borrowings         (30 )   -0.05 %       (30 )   -0.05 %       (30 )   -0.05 %       (30 )   -0.05 %       (30 )   -0.05 %         (90 )   -0.05 %       (96 )   -0.05 %
Net interest income from fair value marks     $   637       $   1,167       $   1,105       $   895       $   1,016         $   2,909       $   3,974    
Purchase accounting effect on tax-equivalent margin       0.09 %       0.17 %       0.16 %       0.13 %       0.15 %         0.14 %       0.20 %
* Average loans and leases include portfolio loans and leases, and loans held for sale. Non-accrual loans are also included in the average loan and leases balances.
                                               
                                               

 

Bryn Mawr Bank Corporation
Appendix – Non-GAAP to GAAP Reconciliations and Calculation of Non-GAAP Performance Measures (unaudited)
(dollars in thousands, except per share data)
                         
Statement on Non-GAAP Measures: The Corporation believes the presentation of the following non-GAAP financial measures provides useful supplemental information that is essential to an investor’s proper understanding of the results of operations and financial condition of the Corporation. Management uses non-GAAP financial measures in its analysis of the Corporation’s performance. These non-GAAP measures should not be viewed as substitutes for the financial measures determined in accordance with GAAP, nor are they necessarily comparable to  non-GAAP performance measures that may be presented by other companies.      
                         
  As of or For the Three Months Ended   As of or For the Nine Months Ended
  September 30, 2016   June 30, 2016   March 31, 2016   December 31, 2015   September 30, 2015   September 30, 2016   September 30, 2015
Reconciliation of Net Income to Net Income (core):                                  
Net income (loss) (a GAAP measure) $ 9,374     $ 8,933     $ 8,321     $ (6,355 )   $ 7,496     $ 26,628     $ 23,109  
Less: Tax-effected non-core noninterest income:                        
Loss (gain) on sale of investment securities available for sale   18       28       10       (38 )     (39 )     56       (567 )
Add: Tax-effected non-core noninterest expense items:                        
Loss on pension termination                     11,295                    
Severance expense (Salaries and wages)                     142       124              
Branch lease termination expense                     604                    
Debt and swap prepayment penalty (Other operating expenses)                     397                   339  
Impairment of intangible assets                     252                    
Due diligence, merger-related and merger integration  expenses     –         –         –         1,209         660         –         3,127  
Net income (core) (a non-GAAP measure) $    9,392     $    8,961     $    8,331     $    7,506     $    8,241     $    26,684     $    26,008  
                                   
Calculation of Basic and Diluted Earnings per Common Share (core):                                
Weighted average common shares outstanding   16,860,727       16,812,219       16,848,202       17,129,234       17,572,421       16,840,457       17,630,263  
Dilutive common shares     211,631         215,200         35,162         112,783         261,877         153,998         349,163  
Adjusted weighted average diluted shares   17,072,358       17,027,419       16,883,364       17,242,017       17,834,298       16,994,455       17,979,426  
Basic earnings per common share (core) (a non-GAAP measure) $ 0.56     $ 0.53     $ 0.49     $ 0.44     $ 0.47     $ 1.58     $ 1.48  
Diluted earnings per common share (core) (a non-GAAP measure) $ 0.55     $ 0.53     $ 0.49     $ 0.44     $ 0.46     $ 1.57     $ 1.45  
                         
Calculation of Return on Average Tangible Equity:                        
Net income (loss) $ 9,374     $ 8,933     $ 8,321     $ (6,355 )   $ 7,496     $ 26,628     $ 23,109  
Add: Tax-effected amortization and impairment of intangible assets     577         578         579         861         619         1,734         1,879  
Net tangible income (numerator) $ 9,951     $ 9,511     $ 8,900     $ (5,494 )   $ 8,115     $ 28,362     $ 24,988  
                         
Average shareholders’ equity $ 372,954     $ 366,115     $ 360,872     $ 365,360     $ 376,604     $ 366,669     $ 375,695  
Less: Average goodwill and intangible assets     (126,505 )       (127,402 )       (128,296 )       (129,292 )       (130,241 )       (127,398 )       (127,806 )
Net average tangible equity (denominator) $ 246,449     $ 238,713     $ 232,576     $ 236,068     $ 246,363     $ 239,271     $ 247,889  
                         
Return on tangible equity (a non-GAAP measure)   16.06 %     16.02 %     15.39 %     -9.23 %     13.07 %     15.83 %     13.48 %
                         
Calculation of Tangible Equity Ratio:                        
Total shareholders’ equity $ 378,459     $ 372,467     $ 365,177     $ 365,711     $ 368,155        
Less: Goodwill and intangible assets     (126,000 )       (126,888 )       (127,777 )       (128,668 )       (129,694 )      
Net tangible equity (numerator) $ 252,459     $ 245,579     $ 237,400     $ 237,043     $ 238,461        
                         
Total assets $ 3,174,080     $ 3,090,090     $ 3,058,247     $ 3,030,997     $ 2,952,742        
Less: Goodwill and intangible assets     (126,000 )       (126,888 )       (127,777 )       (128,668 )       (129,694 )      
Tangible assets (denominator) $ 3,048,080     $ 2,963,202     $ 2,930,470     $ 2,902,329     $ 2,823,048        
                         
Tangible equity ratio   8.28 %     8.29 %     8.10 %     8.17 %     8.45 %      
                         
Calculation of Efficiency Ratio:                        
Noninterest expense $ 25,477     $ 26,259     $ 25,051     $ 46,951     $ 25,403     $ 76,787     $ 78,814  
Less: certain noninterest expense items*:                        
Loss on pension termination                     (17,377 )                  
Severance expense (Salaries and wages)                     (218 )     (191 )            
Branch lease termination expense                     (929 )                  
Debt and swap prepayment penalty (Other operating expenses)                     (611 )                 (522 )
Amortization of intangibles   (888 )     (889 )     (891 )     (937 )     (953 )     (2,668 )     (2,890 )
Impairment of intangible assets                     (388 )                  
Due diligence, merger-related and merger integration  expenses     –         –         –         (1,860 )       (1,015 )       –         (4,810 )
Noninterest expense (adjusted) (numerator) $ 24,589     $ 25,370     $ 24,160     $ 24,631     $ 23,244     $ 74,119     $ 70,592  
                         
Noninterest income $ 13,892     $ 13,820     $ 13,208     $ 13,668     $ 13,350     $ 40,920     $ 42,292  
Less: non-core noninterest income items:                        
Loss (gain) on sale of investment securities available for sale     28         43         15         (58 )       (60 )       86         (872 )
Noninterest income (core) $ 13,920     $ 13,863     $ 13,223     $ 13,610     $ 13,290     $ 41,006     $ 41,420  
Net interest income     26,717         26,627         25,902         25,429         24,833         79,246         74,698  
Noninterest income (core) and net interest income (denominator) $ 40,637     $ 40,490     $ 39,125     $ 39,039     $ 38,123     $ 120,252     $ 116,118  
                         
Efficiency ratio   60.51 %     62.66 %     61.75 %     63.09 %     60.97 %     61.64 %     60.79 %
       
* In calculating the Corporation’s efficiency ratio, which is used by Management to identify the cost of generating each dollar of core revenue, certain non-core income and expense items as well as the amortization of intangible assets, are excluded.      
                         
Supplemental Loan and Allowance Information Used to Calculate Non-GAAP Measures
                         
Total Allowance $ 17,744     $ 17,036     $ 16,845     $ 15,857     $ 15,935        
less: Allowance on acquired loans     28         28         28         –         35        
Allowance on originated loans and leases $ 17,716     $ 17,008     $ 16,817     $ 15,857     $ 15,900        
                         
Total Allowance $ 17,744     $ 17,036     $ 16,845     $ 15,857     $ 15,935        
Loan mark on acquired loans     13,391         14,566         15,930         17,108         18,179        
Total Allowance + Loan mark $ 31,135     $ 31,602     $ 32,775     $ 32,965     $ 34,114        
                         
Total Portfolio loans and leases $ 2,493,357     $ 2,423,821     $ 2,378,841     $ 2,268,988     $ 2,228,764        
less: Originated loans and leases     2,176,549         2,090,070         2,015,683         1,883,869         1,804,835        
Net acquired loans $ 316,808     $ 333,751     $ 363,158     $ 385,119     $ 423,929        
add: Loan mark on acquired loans     13,391         14,566         15,930         17,108         18,179        
Gross acquired loans (excludes loan mark) $ 330,199     $ 348,317     $ 379,088     $ 402,227     $ 442,108        
Originated loans and leases     2,176,549         2,090,070         2,015,683         1,883,869         1,804,835        
Total Gross portfolio loans and leases $ 2,506,748     $ 2,438,387     $ 2,394,771     $ 2,286,096     $ 2,246,943        
                         

 

CONTACT: FOR MORE INFORMATION CONTACT:
Frank Leto, President, CEO
610-581-4730 
Mike Harrington, CFO
610-526-2466