OAK RIDGE, N.J., Oct. 21, 2014 (GLOBE NEWSWIRE) -- Lakeland Bancorp, Inc. (Nasdaq:LBAI) reported the following positive results in the third quarter of 2014:
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Net Income in the third quarter of 2014 was $8.2 million or $0.22 per diluted share compared to $6.6 million or $0.18 per diluted share for the same period last year. Third quarter 2013 results included $0.7 million, or $0.02 per diluted share in merger expenses relating to the acquisition of Somerset Hills Bancorp. Exclusive of these merger related expenses, Net Income in the third quarter of 2013 was $7.2 million, or $0.20 per diluted share. In the third quarter of 2014, Annualized Return on Average Assets was 0.95%, Annualized Return on Average Common Equity was 8.83%, and Annualized Return on Average Tangible Common Equity was 12.66%. Tangible book value per common share at September 30, 2014 was $6.87, an increase of 8.9% compared to year-end 2013.
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Net Income for the first nine months of 2014 was $23.2 million or $0.61 per diluted share compared to $17.6 million, or $0.52 per diluted share for the same period last year. Excluding merger costs of $2.8 million and a $1.2 million gain on debt extinguishment in 2013, Net Income was $19.0 million or $0.56 per diluted share for the first nine months of 2013. The Annualized Return on Average Assets for the nine months ended September 30, 2014 was 0.92%, the Annualized Return on Average Common Equity was 8.52%, and the Annualized Return on Average Tangible Common Equity was 12.33%.
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At September 30, 2014 loans totaled $2.61 billion, an increase of $143.1 million, or 6%, compared to year-end 2013. The overall increase was primarily in total commercial loans, which increased by $132.3 million, or 8%.
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Non-interest-bearing demand deposits totaled $674.9 million at September 30, 2014, an increase of $25.7 million, or 4% in the third quarter of 2014, and $74.3 million, or 12% year-to-date. Non-interest-bearing demand deposits represent 24% of total deposits.
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The efficiency ratio in the third quarter of 2014 was 58.0% compared to 60.0% for the same period last year. Non-interest expenses in the third quarter of 2014 totaled $19.7 million, which equaled non-interest expenses for the same period last year (excluding merger related expenses of $0.7 million).
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Non-performing assets at $19.6 million decreased by $0.6 million compared to the previous quarter, while net charge-offs at $1.0 million (0.16% of average loans) were at the lowest level in the past five quarters. The Allowance for Loan and Lease Losses totaled $30.0 million and was 161% of non-accruing loans at September 30, 2014.
- On October 15, 2014, the Company declared a quarterly cash dividend of $0.075 per common share, payable on November 14, 2014 to holders of record as of the close of business on November 3, 2014.
Thomas J. Shara, Lakeland Bancorp's President and CEO said, "Net income, exclusive of merger related expenses, increased by 15% as compared to the third quarter of 2013, while EPS increased by 10% (excluding the impact of merger related expenses). This improvement resulted from increased Net Interest Income driven by strong loan growth this year, a 36% reduction in the provision for loan and lease losses resulting from continued improvement in asset quality, and controlled noninterest expenses."
Earnings
As previously noted, the Company acquired Somerset Hills Bancorp ("Somerset Hills"), which had total assets of $355.9 million at the time of acquisition, on May 31, 2013. The Company's financial statements reflect the impact of the merger from the date of acquisition, which should be considered when comparing the results of 2014 and 2013, respectively.
Net Interest Income
Net interest income for the third quarter of 2014 was $28.5 million, as compared to $27.5 million for the same period in 2013, an increase of 4%. In the third quarter of 2014, Net Interest Margin ("NIM") was 3.58%, which compared to 3.69% reported in the second quarter of 2014, and 3.68% in the third quarter of 2013. The decrease in NIM in the third quarter of 2014 was primarily due to a decrease in the yield on interest-earning assets. The annualized yield on interest-earning assets declined thirteen basis points from 4.00% in the third quarter of 2013 to 3.87% for the same period this year, driven by a 20 basis point decrease in the yield on average loans. The strong loan growth in the first two quarters of 2014 resulted in new loans originated or refinanced at lower rates. The annualized cost of interest-bearing liabilities has decreased three basis points from 0.42% in the third quarter of 2013 to 0.39% in the third quarter of 2014, as liability costs have remained fairly stable.
Year-to-date, net interest income at $84.7 million compared to the $76.6 million reported for the first nine months of 2013, increased 11%. Annualized Net Interest Margin for the first nine months of 2014 at 3.66% compared to 3.69% for the same period last year. The Company's annualized yield on interest-earning assets decreased from 4.05% for the first nine months of 2013 to 3.94% for the same period this year. The Company's cost of interest-bearing liabilities decreased from 0.46% for the first nine months of 2013 to 0.37% for the first nine months of this year.
Noninterest Income
Noninterest income totaled $4.8 million for the third quarter of 2014, as compared to $4.6 million for the same period last year. Service charges on deposit accounts totaling $2.7 million decreased by 5% from the same period last year, primarily due to a decline in overdraft fees. Commissions and fees at $1.4 million increased by $0.2 million, or 20%, primarily due to an increase in loan fees. Other income at $0.4 million was $0.1 million higher than last year's third quarter total primarily due to gains recorded on the sale of real estate properties.
Noninterest income, exclusive of $0.5 million in gains on sales of investment securities and a $1.2 million gain on debt extinguishment in the first nine months of 2013, totaled $13.3 million for the first nine months of 2014, which was $0.5 million lower than last year's nine month total. Service charges on deposit accounts at $7.9 million decreased by 2%, while commissions and fees at $3.5 million was equivalent to last year's total. Other income at $0.8 million decreased by $0.4 million primarily due to reductions in both gains on sales of mortgage loans and loan swap income.
Noninterest Expense
Noninterest expense for the third quarter of 2014 was $19.7 million, as compared to $20.4 million for the same period last year. Included in non-interest expenses in the third quarter of 2013 were $0.7 million in merger related expenses. Exclusive of the merger related costs in 2013, third quarter 2014 non-interest expenses equaled non-interest expenses for the same period in 2013. Salary and benefit expense at $11.3 million increased by 3% from the same period last year, while net occupancy, furniture and equipment expenses at $3.6 million was equivalent to last year's third quarter totals. The efficiency ratio for the third quarter of 2014 was 58.0% as compared to 60.0% for the same period last year.
For the first nine months of 2014, non-interest expenses were $59.0 million compared to $58.0 million for the same period last year. In the first nine months of 2013 the Company recorded $2.8 million in merger related expenses and $0.5 million in prepayment fees on long-term debt. Exclusive of these items in 2013, non-interest expenses for the first nine months of 2014 were $4.3 million higher than the same period in 2013, which only included Somerset Hills' expenses from the May 31, 2013 merger date. Salary and benefit expense at $33.3 million increased by 7%, partially due to increased staffing due to the Somerset Hills merger. Net occupancy, furniture and equipment expenses at $11.6 million were $1.2 million higher than last year primarily due to expenses relating to the six new branches acquired in the Somerset Hills merger, as well as a $0.4 million increase in snow removal costs in the first quarter of 2014. Other expenses at $8.8 million increased by $0.8 million partially due to an increase of $0.5 million in professional fees.
Financial Condition
At September 30, 2014, total assets were $3.50 billion, an increase of $181.1 million, or 5%, from December 31, 2013. As previously mentioned, total loans were $2.61 billion, an increase of $143.1 million, or 6%, from December 31, 2013. Total deposits were $2.78 billion, an increase of $67.7 million from December 31, 2013. Non-interest demand deposits at $674.9 million have increased by $74.3 million, or 12% in 2014, while interest-bearing deposits at $2.1 billion have remained relatively unchanged in 2014.
Asset Quality
At September 30, 2014, non-performing assets totaled $19.6 million (0.56% of total assets) compared to $20.2 million (0.58% of total assets) at June 30, 2014. The Allowance for Loan and Lease Losses totaled $30.0 million at September 30, 2014 and represented 1.15% of total loans. In the third quarter of 2014, the Company had net charge offs totaling $1.0 million compared to $1.7 million in the third quarter of 2013. For the first nine months of 2014, the Company had net charge-offs of $4.1 million (0.21% of average loans), as compared to $6.8 million (0.40% of average loans) for the same period last year. The provision for loan and lease losses in the third quarter of 2014 was $1.2 million, compared to $1.9 million in the same period last year, and $4.3 million as compared to $7.7 million for the first nine months of 2014 and 2013, respectively.
Capital
At September 30, 2014, stockholders' equity was $372.5 million. Book value per common share was $9.83 and tangible book value was $6.87, an increase of 8.9% year-to-date. As of September 30, 2014, the Company's leverage ratio was 9.02%. Tier I and total risk based capital ratios were 11.75% and 12.97%, respectively. The Tangible Common Equity ratio was 7.69%, an increase from 7.46% reported at December 31, 2013. These regulatory capital ratios exceed those necessary to be considered a well-capitalized institution under Federal guidelines.
Forward-Looking Statements
The information disclosed in this document includes various forward-looking statements (with respect to corporate objectives, trends, and other financial and business matters) that are made in reliance upon the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The words "anticipates", "projects", "intends", "estimates", "expects", "believes", "plans", "may", "will", "should", "could", and other similar expressions are intended to identify such forward-looking statements. Lakeland cautions that these forward-looking statements are necessarily speculative and speak only as of the date made, and are subject to numerous assumptions, risks and uncertainties, all of which may change over time. Actual results could differ materially from such forward-looking statements. The following factors, among others, could cause actual results to differ materially and adversely from such forward-looking statements: changes in the financial services industry and the U.S. and global capital markets, changes in economic conditions nationally, regionally and in the Company's markets, the nature and timing of actions of the Federal Reserve Board and other regulators, the nature and timing of legislation affecting the financial services industry, government intervention in the U.S. financial system, changes in levels of market interest rates, pricing pressures on loan and deposit products, credit risks of the Company's lending and leasing activities, customers' acceptance of the Company's products and services, and competition. Any statements made by Lakeland that are not historical facts should be considered to be forward-looking statements. Lakeland is not obligated to update and does not undertake to update any of its forward-looking statements made herein.
EXPLANATION OF NON-GAAP FINANCIAL MEASURES
Reported amounts are presented in accordance with accounting principles generally accepted in the United States of America ("GAAP"). The Company's management believes that the supplemental non-GAAP information, which consists of measurements and ratios based on tangible equity and tangible assets, is utilized by regulators and market analysts to evaluate a company's financial condition and therefore, such information is useful to investors. These disclosures should not be viewed as a substitute for financial results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures which may be presented by other companies.
The Company also uses an efficiency ratio that is a non-GAAP financial measure. The ratio that the Company uses excludes amortization of core deposit intangibles, expenses on other real estate owned and other repossessed assets, provision for unfunded lending commitments and, where applicable, long-term debt prepayment fees and merger related expenses. Income for the non-GAAP ratio is increased by the favorable effect of tax-exempt income and excludes securities gains and losses and gain on debt extinguishment, which can vary from period to period. The Company uses this ratio because it believes the ratio provides a better comparison of period to period operating performance.
About Lakeland Bank
Lakeland Bancorp, the holding company for Lakeland Bank, has $3.5 billion in total assets with 51 offices spanning eight northern New Jersey counties: Bergen, Essex, Morris, Passaic, Somerset, Sussex, Union and Warren. Lakeland Bank is the second largest commercial bank headquartered in the state and offers an extensive array of consumer and commercial products and services, including online and mobile banking, localized commercial lending teams, and 24-hour or less turnaround time on consumer loan applications. For more information about the full line of products and services, visit LakelandBank.com.
| Lakeland Bancorp, Inc. | ||||
| Financial Highlights | ||||
| (unaudited) | ||||
| Three Months Ended September 30, | Nine months Ended September 30, | |||
| 2014 | 2013 | 2014 | 2013 | |
| (Dollars in thousands except per share amounts) | ||||
| INCOME STATEMENT | ||||
| Net Interest Income | $ 28,452 | $ 27,487 | $ 84,716 | $ 76,569 |
| Provision for Loan and Lease Losses | (1,194) | (1,879) | (4,276) | (7,656) |
| Other Noninterest Income | 4,809 | 4,645 | 13,251 | 13,786 |
| Gains on investment securities | -- | -- | 2 | 506 |
| Gain on debt extinguishment | -- | -- | -- | 1,197 |
| Long-term debt prepayment fee | -- | -- | -- | (526) |
| Merger related expenses | -- | (744) | -- | (2,827) |
| Noninterest Expense | (19,685) | (19,663) | (58,957) | (54,674) |
| Pretax Income | 12,382 | 9,846 | 34,736 | 26,375 |
| Tax Expense | (4,136) | (3,229) | (11,546) | (8,747) |
| Net Income | $ 8,246 | $ 6,617 | $ 23,190 | $ 17,628 |
| Basic Earnings Per Common Share (1) | $ 0.22 | $ 0.18 | $ 0.61 | $ 0.52 |
| Diluted Earnings Per Common Share (1) | $ 0.22 | $ 0.18 | $ 0.61 | $ 0.52 |
| Dividends per Common Share (1) | $ 0.075 | $ 0.067 | $ 0.218 | $ 0.200 |
| Weighted Average Shares - Basic (1) | 37,738 | 37,288 | 37,720 | 33,834 |
| Weighted Average Shares - Diluted (1) | 37,862 | 37,523 | 37,838 | 33,972 |
| SELECTED OPERATING RATIOS | ||||
| Annualized Return on Average Assets | 0.95% | 0.81% | 0.92% | 0.78% |
| Annualized Return on Average Common Equity | 8.83% | 7.64% | 8.52% | 7.59% |
| Annualized Return on Average Tangible Common Equity (2) | 12.66% | 11.39% | 12.33% | 11.12% |
| Annualized Return on Interest Earning Assets | 3.87% | 4.00% | 3.94% | 4.05% |
| Annualized Cost of Interest Bearing Liabilities | 0.39% | 0.42% | 0.37% | 0.46% |
| Annualized Net Interest Spread | 3.48% | 3.58% | 3.57% | 3.58% |
| Annualized Net Interest Margin | 3.58% | 3.68% | 3.66% | 3.69% |
| Efficiency ratio (2) | 57.97% | 59.98% | 59.18% | 59.85% |
| Stockholders' equity to total assets | 10.65% | 10.53% | ||
| Book value per common share (1) | $ 9.83 | $ 9.24 | ||
| Tangible book value per common share (1) (2) | $ 6.87 | $ 6.24 | ||
| Tangible common equity to tangible assets (1) (2) | 7.69% | 7.36% | ||
| ASSET QUALITY RATIOS | 9/30/2014 | 12/31/2013 | ||
| Ratio of allowance for loan and lease losses to total loans | 1.15% | 1.21% | ||
| Non-accruing loans to total loans | 0.71% | 0.69% | ||
| Non-performing assets to total assets | 0.56% | 0.53% | ||
| Annualized net charge-offs to average loans | 0.21% | 0.36% | ||
| SELECTED BALANCE SHEET DATA AT PERIOD-END | 9/30/2014 | 12/31/2013 | ||
| Loans and Leases | $ 2,613,404 | $ 2,470,289 | ||
| Allowance for Loan and Lease Losses | (30,047) | (29,821) | ||
| Investment Securities | 558,032 | 540,788 | ||
| Total Assets | 3,498,905 | 3,317,791 | ||
| Total Deposits | 2,776,931 | 2,709,205 | ||
| Short-Term Borrowings | 112,796 | 81,991 | ||
| Other Borrowings | 220,938 | 160,238 | ||
| Stockholders' Equity | 372,539 | 351,424 | ||
| SELECTED AVERAGE BALANCE SHEET DATA | For the Three Months Ended | For the Nine Months Ended | ||
| 9/30/2014 | 9/30/2013 | 9/30/2014 | 9/30/2013 | |
| Loans and Leases, net | $ 2,608,687 | $ 2,435,658 | $ 2,549,675 | $ 2,279,972 |
| Investment Securities | 529,379 | 506,263 | 536,313 | 484,146 |
| Interest-Earning Assets | 3,183,361 | 2,987,408 | 3,120,265 | 2,799,696 |
| Total Assets | 3,443,946 | 3,243,997 | 3,372,590 | 3,039,166 |
| Non Interest-Bearing Demand Deposits | 671,049 | 620,499 | 643,548 | 555,663 |
| Savings Deposits | 382,642 | 374,141 | 384,934 | 367,245 |
| Interest-Bearing Transaction Accounts | 1,457,680 | 1,403,227 | 1,444,006 | 1,305,173 |
| Time Deposits | 280,200 | 322,371 | 285,919 | 311,994 |
| Total Deposits | 2,791,571 | 2,720,238 | 2,758,407 | 2,540,075 |
| Short-Term Borrowings | 49,725 | 47,702 | 61,575 | 48,658 |
| Other Borrowings | 217,049 | 117,559 | 173,949 | 125,367 |
| Total Interest-Bearing Liabilities | 2,387,295 | 2,265,000 | 2,350,383 | 2,158,437 |
| Stockholders' Equity | 370,448 | 343,482 | 363,783 | 310,632 |
| (1) Adjusted for 5% stock dividend paid on June 17, 2014 to shareholders of record June 3, 2014 | ||||
| (2) See supplemental information - non-GAAP financial measures | ||||
| Lakeland Bancorp, Inc. and Subsidiaries | ||||
| CONSOLIDATED STATEMENTS OF OPERATIONS | ||||
| (Unaudited) | ||||
| Three Months Ended September 30, | Nine Months Ended September 30, | |||
| 2014 | 2013 | 2014 | 2013 | |
| (dollars in thousands, except per share amounts) | ||||
| INTEREST INCOME | ||||
| Loans and fees | $27,949 | $27,350 | $82,405 | $77,122 |
| Federal funds sold and interest bearing deposits with banks | 24 | 27 | 46 | 57 |
| Taxable investment securities and other | 2,387 | 2,017 | 7,448 | 5,544 |
| Tax exempt investment securities | 436 | 461 | 1,376 | 1,331 |
| TOTAL INTEREST INCOME | 30,796 | 29,855 | 91,275 | 84,054 |
| INTEREST EXPENSE | ||||
| Deposits | 1,256 | 1,518 | 3,762 | 4,740 |
| Federal funds purchased and securities sold under agreements to repurchase | 19 | 14 | 69 | 36 |
| Other borrowings | 1,069 | 836 | 2,728 | 2,709 |
| TOTAL INTEREST EXPENSE | 2,344 | 2,368 | 6,559 | 7,485 |
| NET INTEREST INCOME | 28,452 | 27,487 | 84,716 | 76,569 |
| Provision for loan and lease losses | 1,194 | 1,879 | 4,276 | 7,656 |
| NET INTEREST INCOME AFTER PROVISION FOR | ||||
| LOAN AND LEASE LOSSES | 27,258 | 25,608 | 80,440 | 68,913 |
| NONINTEREST INCOME | ||||
| Service charges on deposit accounts | 2,689 | 2,838 | 7,911 | 8,052 |
| Commissions and fees | 1,371 | 1,139 | 3,466 | 3,495 |
| Gains on sales and calls of investment securities | -- | -- | 2 | 506 |
| Gain on debt extinguishment | -- | -- | -- | 1,197 |
| Income on bank owned life insurance | 365 | 383 | 1,090 | 1,036 |
| Other income | 384 | 285 | 784 | 1,203 |
| TOTAL NONINTEREST INCOME | 4,809 | 4,645 | 13,253 | 15,489 |
| NONINTEREST EXPENSE | ||||
| Salaries and employee benefits | 11,327 | 11,019 | 33,340 | 31,105 |
| Net occupancy expense | 2,017 | 2,060 | 6,675 | 5,921 |
| Furniture and equipment | 1,605 | 1,582 | 4,958 | 4,492 |
| Stationery, supplies and postage | 368 | 348 | 1,056 | 1,086 |
| Marketing expense | 629 | 715 | 1,491 | 1,438 |
| FDIC insurance expense | 489 | 436 | 1,501 | 1,505 |
| Legal expense | 144 | 406 | 636 | 934 |
| Other real estate owned and other repossessed asset expense | 50 | (2) | 165 | 15 |
| Long-term debt prepayment fee | -- | -- | -- | 526 |
| Merger related expenses | -- | 744 | -- | 2,827 |
| Core deposit intangible amortization | 111 | 123 | 353 | 164 |
| Other expenses | 2,945 | 2,976 | 8,782 | 8,014 |
| TOTAL NONINTEREST EXPENSE | 19,685 | 20,407 | 58,957 | 58,027 |
| INCOME BEFORE PROVISION FOR INCOME TAXES | 12,382 | 9,846 | 34,736 | 26,375 |
| Provision for income taxes | 4,136 | 3,229 | 11,546 | 8,747 |
| NET INCOME | $8,246 | $6,617 | $23,190 | $17,628 |
| EARNINGS PER COMMON SHARE (1) | ||||
| Basic | $0.22 | $0.18 | $0.61 | $0.52 |
| Diluted | $0.22 | $0.18 | $0.61 | $0.52 |
| DIVIDENDS PER COMMON SHARE (1) | $0.075 | $0.067 | $0.218 | $0.200 |
| (1) Adjusted for 5% stock dividend paid on June 17, 2014 to shareholders of record June 3, 2014 | ||||
| Lakeland Bancorp, Inc. and Subsidiaries | ||
| CONSOLIDATED BALANCE SHEETS | ||
| September 30, | December 31, | |
| ASSETS | 2014 | 2013 |
| (dollars in thousands) | (unaudited) | |
| Cash and due from banks | $122,989 | $94,205 |
| Federal funds sold and interest-bearing deposits due from banks | 4,177 | 8,516 |
| Total cash and cash equivalents | 127,166 | 102,721 |
| Investment securities available for sale, at fair value | 444,292 | 431,106 |
| Investment securities held to maturity; fair value of $105,127 in 2014 and $100,394 in 2013 | 104,909 | 101,744 |
| Federal Home Loan Bank and other membership stocks, at cost | 8,831 | 7,938 |
| Loans held for sale | 1,519 | 1,206 |
| Loans: | ||
| Commercial, secured by real estate | 1,557,168 | 1,442,980 |
| Commercial, industrial and other | 231,961 | 213,808 |
| Leases | 52,285 | 41,332 |
| Residential mortgages | 431,477 | 432,831 |
| Consumer and home equity | 340,513 | 339,338 |
| Total loans | 2,613,404 | 2,470,289 |
| Net deferred costs | (1,639) | (1,273) |
| Allowance for loan and lease losses | (30,047) | (29,821) |
| Net loans | 2,581,718 | 2,439,195 |
| Premises and equipment, net | 36,049 | 37,148 |
| Accrued interest receivable | 8,512 | 8,603 |
| Goodwill | 109,974 | 109,974 |
| Other identifiable intangible assets | 2,071 | 2,424 |
| Bank owned life insurance | 57,058 | 55,968 |
| Other assets | 16,806 | 19,764 |
| TOTAL ASSETS | $3,498,905 | $3,317,791 |
| LIABILITIES AND STOCKHOLDERS' EQUITY | ||
| LIABILITIES: | ||
| Deposits: | ||
| Noninterest bearing | $674,933 | $600,652 |
| Savings and interest-bearing transaction accounts | 1,820,657 | 1,812,467 |
| Time deposits under $100,000 | 168,391 | 180,859 |
| Time deposits $100,000 and over | 112,950 | 115,227 |
| Total deposits | 2,776,931 | 2,709,205 |
| Federal funds purchased and securities sold under agreements to repurchase | 112,796 | 81,991 |
| Other borrowings | 179,700 | 119,000 |
| Subordinated debentures | 41,238 | 41,238 |
| Other liabilities | 15,701 | 14,933 |
| TOTAL LIABILITIES | 3,126,366 | 2,966,367 |
| STOCKHOLDERS' EQUITY | ||
| Common stock, no par value; authorized 70,000,000 shares; issued 37,910,372 shares at September 30, 2014 and 37,873,800 shares at December 31, 2013 | 383,819 | 364,637 |
| Accumulated Deficit | (11,267) | (8,538) |
| Accumulated other comprehensive (loss) | (13) | (4,675) |
| TOTAL STOCKHOLDERS' EQUITY | 372,539 | 351,424 |
| TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $3,498,905 | $3,317,791 |
| Lakeland Bancorp, Inc. | |||||
| Financial Highlights | |||||
| (unaudited) | |||||
| For the Quarter Ended | |||||
| Sept 30, | Jun 30, | Mar 31, | Dec 31, | Sept 30, | |
| (dollars in thousands, except per share data) | 2014 | 2014 | 2014 | 2013 | 2013 |
| INCOME STATEMENT | (unaudited) | ||||
| Net Interest Income | $ 28,452 | $ 28,419 | $ 27,845 | $ 27,973 | $ 27,487 |
| Provision for Loan and Lease Losses | (1,194) | (1,593) | (1,489) | (1,687) | (1,879) |
| Other Noninterest Income | 4,809 | 4,371 | 4,071 | 5,139 | 4,645 |
| Gains on investment securities | -- | -- | 2 | 333 | -- |
| Long-term debt prepayment fee | -- | -- | -- | (683) | -- |
| Merger related expenses | -- | -- | -- | (7) | (744) |
| Core deposit intangible amortization | (111) | (119) | (123) | (124) | (123) |
| Other Noninterest Expense | (19,574) | (19,411) | (19,619) | (19,900) | (19,540) |
| Pretax Income | 12,382 | 11,667 | 10,687 | 11,044 | 9,846 |
| Tax Expense | (4,136) | (3,886) | (3,524) | (3,703) | (3,229) |
| Net Income | $ 8,246 | $ 7,781 | $ 7,163 | $ 7,341 | $ 6,617 |
| Basic Earnings Per Common Share (1) | $ 0.22 | $ 0.20 | $ 0.19 | $ 0.19 | $ 0.18 |
| Diluted Earnings Per Common Share (1) | $ 0.22 | $ 0.20 | $ 0.19 | $ 0.19 | $ 0.18 |
| Dividends Per Common Share (1) | $ 0.075 | $ 0.071 | $ 0.071 | $ 0.071 | $ 0.067 |
| Dividends Paid | $ 2,853 | $ 2,717 | $ 2,705 | $ 2,688 | $ 2,504 |
| Weighted Average Shares - Basic (1) | 37,738 | 37,740 | 37,683 | 37,436 | 37,288 |
| Weighted Average Shares - Diluted (1) | 37,862 | 37,850 | 37,806 | 37,649 | 37,522 |
| SELECTED OPERATING RATIOS | |||||
| Annualized Return on Average Assets | 0.95% | 0.93% | 0.88% | 0.88% | 0.81% |
| Annualized Return on Average Common Equity | 8.83% | 8.58% | 8.14% | 8.30% | 7.64% |
| Annualized Return on Tangible Common Equity (2) | 12.66% | 12.41% | 11.88% | 12.23% | 11.39% |
| Annualized Net Interest Margin | 3.58% | 3.69% | 3.72% | 3.70% | 3.68% |
| Efficiency ratio (2) | 57.97% | 58.73% | 60.90% | 59.44% | 59.98% |
| Common stockholders' equity to total assets | 10.65% | 10.57% | 10.62% | 10.59% | 10.53% |
| Tangible common equity to tangible assets (2) | 7.69% | 7.59% | 7.55% | 7.46% | 7.36% |
| Tier 1 risk-based ratio | 11.75% | 11.54% | 11.76% | 11.73% | 11.64% |
| Total risk-based ratio | 12.97% | 12.75% | 13.01% | 12.98% | 12.89% |
| Tier 1 leverage ratio | 9.02% | 9.06% | 9.01% | 8.90% | 8.84% |
| Book value per common share (1) | $ 9.83 | $ 9.70 | $ 9.48 | $ 9.28 | $ 9.24 |
| Tangible book value per common share (1) (2) | $ 6.87 | $ 6.74 | $ 6.52 | $ 6.31 | $ 6.24 |
| (1) Adjusted for 5% stock dividend paid on June 17, 2014 to shareholders of record June 3, 2014 | |||||
| (2) See Supplemental Information - Non GAAP financial measures | |||||
| Lakeland Bancorp, Inc. | |||||
| Financial Highlights | |||||
| (unaudited) | |||||
| For the Quarter Ended | |||||
| Sept 30, | Jun 30, | Mar 31, | Dec 31, | Sept 30, | |
| (dollars in thousands) | 2014 | 2014 | 2014 | 2013 | 2013 |
| (unaudited) | |||||
| SELECTED BALANCE SHEET DATA AT PERIOD-END | |||||
| Loans and Leases | $ 2,613,404 | $ 2,610,198 | $ 2,504,626 | $ 2,470,289 | $ 2,428,750 |
| Allowance for Loan and Lease Losses | (30,047) | (29,866) | (29,520) | (29,821) | (29,757) |
| Investment Securities | 558,032 | 530,934 | 533,165 | 540,788 | 521,229 |
| Total Assets | 3,498,905 | 3,479,548 | 3,386,720 | 3,317,791 | 3,299,300 |
| Total Deposits | 2,776,931 | 2,726,850 | 2,736,733 | 2,709,205 | 2,708,454 |
| Short-Term Borrowings | 112,796 | 156,511 | 115,952 | 81,991 | 110,525 |
| Other Borrowings | 220,938 | 215,238 | 160,238 | 160,238 | 117,548 |
| Stockholders' Equity | 372,539 | 367,833 | 359,539 | 351,424 | 347,525 |
| Loans and Leases | |||||
| Commercial real estate | $ 1,557,168 | $ 1,551,071 | $ 1,486,274 | $ 1,442,980 | $ 1,398,435 |
| Commercial, industrial and other | 231,961 | 237,071 | 208,056 | 213,808 | 214,877 |
| Leases | 52,285 | 50,191 | 43,720 | 41,332 | 37,845 |
| Residential mortgages | 431,477 | 433,634 | 430,559 | 432,831 | 437,788 |
| Consumer and Home Equity | 340,513 | 338,231 | 336,017 | 339,338 | 339,805 |
| Total loans | $ 2,613,404 | $ 2,610,198 | $ 2,504,626 | $ 2,470,289 | $ 2,428,750 |
| Deposits | |||||
| Noninterest bearing | $ 674,933 | $ 649,186 | $ 630,499 | $ 600,652 | $ 623,562 |
| Savings and interest-bearing transaction accounts | 1,820,657 | 1,797,358 | 1,816,084 | 1,812,467 | 1,770,299 |
| Time deposits under $100,000 | 168,391 | 169,655 | 177,284 | 180,859 | 190,996 |
| Time deposits $100,000 and over | 112,950 | 110,651 | 112,866 | 115,227 | 123,597 |
| Total deposits | $ 2,776,931 | $ 2,726,850 | $ 2,736,733 | $ 2,709,205 | $ 2,708,454 |
| SELECTED AVERAGE BALANCE SHEET DATA | |||||
| Loans and Leases, net | $ 2,608,687 | $ 2,552,010 | $ 2,486,990 | $ 2,427,505 | $ 2,435,658 |
| Investment Securities | 529,379 | 537,974 | 541,721 | 535,210 | 506,263 |
| Interest-Earning Assets | 3,183,361 | 3,114,539 | 3,061,555 | 3,023,256 | 2,987,408 |
| Total Assets | 3,443,946 | 3,360,289 | 3,312,709 | 3,291,865 | 3,243,997 |
| Non Interest-Bearing Demand Deposits | 671,049 | 640,080 | 618,944 | 638,016 | 620,499 |
| Savings Deposits | 382,642 | 387,179 | 385,007 | 382,062 | 374,141 |
| Interest-Bearing Transaction Accounts | 1,457,680 | 1,433,382 | 1,440,770 | 1,450,055 | 1,403,227 |
| Time Deposits | 280,200 | 284,475 | 293,225 | 301,640 | 322,371 |
| Total Deposits | 2,791,571 | 2,745,116 | 2,737,946 | 2,771,773 | 2,720,238 |
| Short-Term Borrowings | 49,725 | 78,475 | 56,602 | 36,928 | 47,702 |
| Other Borrowings | 217,049 | 158,432 | 145,580 | 117,353 | 117,559 |
| Total Interest-Bearing Liabilities | 2,387,295 | 2,341,944 | 2,321,184 | 2,288,039 | 2,265,000 |
| Stockholders' Equity | 370,448 | 363,802 | 356,951 | 351,067 | 343,482 |
| Lakeland Bancorp, Inc. | |||||
| Financial Highlights | |||||
| (unaudited) | |||||
| For the Quarter Ended | |||||
| Sept 30, | Jun 31, | Mar 31, | Dec 31, | Sept 30, | |
| (dollars in thousands) | 2014 | 2014 | 2014 | 2013 | 2013 |
| (unaudited) | |||||
| AVERAGE ANNUALIZED YIELDS (taxable equivalent basis) | |||||
| Assets: | |||||
| Loans and leases | 4.25% | 4.33% | 4.39% | 4.45% | 4.45% |
| Taxable investment securities and other | 2.08% | 2.18% | 2.19% | 2.12% | 1.87% |
| Tax-exempt securities | 3.79% | 3.74% | 3.80% | 3.83% | 3.74% |
| Federal funds sold and interest-bearing cash accounts | 0.21% | 0.15% | 0.16% | 0.24% | 0.24% |
| Total interest-earning assets | 3.87% | 3.97% | 3.99% | 3.99% | 4.00% |
| Liabilities: | |||||
| Savings accounts | 0.05% | 0.05% | 0.05% | 0.05% | 0.05% |
| Interest-bearing transaction accounts | 0.23% | 0.23% | 0.23% | 0.23% | 0.27% |
| Time deposits | 0.49% | 0.51% | 0.56% | 0.60% | 0.64% |
| Borrowings | 1.63% | 1.50% | 1.63% | 2.13% | 2.06% |
| Total interest-bearing liabilities | 0.39% | 0.36% | 0.36% | 0.38% | 0.42% |
| Net interest spread (taxable equivalent basis) | 3.48% | 3.60% | 3.63% | 3.61% | 3.58% |
| Annualized Net Interest Margin (taxable equivalent basis) | 3.58% | 3.69% | 3.72% | 3.70% | 3.68% |
| Annualized Cost of Deposits | 0.18% | 0.18% | 0.19% | 0.19% | 0.22% |
| ASSET QUALITY DATA | |||||
| Allowance for Loan and Lease Losses | |||||
| Balance at beginning of period | $ 29,866 | $ 29,520 | $ 29,821 | $ 29,757 | $ 29,626 |
| Provision for loan losses | 1,194 | 1,593 | 1,489 | 1,687 | 1,879 |
| Net Charge-offs | (1,013) | (1,247) | (1,790) | (1,623) | (1,748) |
| Balance at end of period | $ 30,047 | $ 29,866 | $ 29,520 | $ 29,821 | $ 29,757 |
| Net Loan Charge-offs (Recoveries) | |||||
| Commercial real estate | $ 28 | $ (152) | $ 1,613 | $ 928 | $ 749 |
| Commercial, industrial and other | (71) | 511 | (578) | 100 | 367 |
| Leases | 229 | 126 | 39 | (2) | 21 |
| Home equity and consumer | 638 | 411 | 567 | 244 | 494 |
| Real estate - mortgage | 189 | 351 | 149 | 353 | 117 |
| Net charge-offs | $ 1,013 | $ 1,247 | $ 1,790 | $ 1,623 | $ 1,748 |
| Nonperforming Assets | |||||
| Commercial real estate | $ 8,549 | $ 9,647 | $ 12,279 | $ 8,528 | $ 7,506 |
| Commercial, industrial and other | 599 | 700 | 246 | 88 | 184 |
| Leases | 141 | 61 | 143 | -- | -- |
| Home equity and consumer | 2,114 | 2,251 | 2,431 | 2,175 | 2,819 |
| Real estate - mortgage | 7,221 | 6,730 | 6,875 | 6,141 | 5,996 |
| Total non-accruing loans | 18,624 | 19,389 | 21,974 | 16,932 | 16,505 |
| Property acquired through foreclosure or repossession | 982 | 850 | 698 | 520 | 2,154 |
| Total non-performing assets | $ 19,606 | $ 20,239 | $ 22,672 | $ 17,452 | $ 18,659 |
| Loans past due 90 days or more | $ 429 | $ 286 | $ 451 | $ 1,997 | $ 2,484 |
| Loans restructured and still accruing | $ 7,957 | $ 6,818 | $ 6,086 | $ 10,289 | $ 13,241 |
| Ratio of allowance for loan and lease losses to total loans | 1.15% | 1.14% | 1.18% | 1.21% | 1.23% |
| Non-performing loans to total loans | 0.71% | 0.74% | 0.88% | 0.69% | 0.68% |
| Non-performing assets to total assets | 0.56% | 0.58% | 0.67% | 0.53% | 0.57% |
| Annualized net charge-offs to average loans | 0.16% | 0.20% | 0.29% | 0.27% | 0.29% |
| Lakeland Bancorp, Inc. | |||||
| Supplemental Information - Non-GAAP Financial Measures | |||||
| (unaudited) | |||||
| At or for the Quarter Ended, | |||||
| Sept 30, | Jun 30, | Mar 31, | Dec 31, | Sept 30, | |
| (dollars in thousands, except per share amounts) | 2014 | 2014 | 2014 | 2013 | 2013 |
| Calculation of tangible book value per common share | |||||
| Total common stockholders' equity at end of period - GAAP | $ 372,539 | $ 367,833 | $ 359,539 | $ 351,424 | $ 347,525 |
| Less: | |||||
| Goodwill | 109,974 | 109,974 | 109,974 | 109,974 | 110,381 |
| Other identifiable intangible assets, net | 2,071 | 2,182 | 2,301 | 2,424 | 2,548 |
| Total tangible common stockholders' equity at end of period - Non- GAAP | $ 260,494 | $ 255,677 | $ 247,264 | $ 239,026 | $ 234,596 |
| Shares outstanding at end of period (1) | 37,910 | 37,914 | 37,912 | 37,874 | 37,614 |
| Book value per share - GAAP (1) | $ 9.83 | $ 9.70 | $ 9.48 | $ 9.28 | $ 9.24 |
| Tangible book value per share - Non-GAAP (1) | $ 6.87 | $ 6.74 | $ 6.52 | $ 6.31 | $ 6.24 |
| Calculation of tangible common equity to tangible assets | |||||
| Total tangible common stockholders' equity at end of period - Non- GAAP | $ 260,494 | $ 255,677 | $ 247,264 | $ 239,026 | $ 234,596 |
| Total assets at end of period | $ 3,498,905 | $ 3,479,548 | $ 3,386,720 | $ 3,317,791 | $ 3,299,300 |
| Less: | |||||
| Goodwill | 109,974 | 109,974 | 109,974 | 109,974 | 110,381 |
| Other identifiable intangible assets, net | 2,071 | 2,182 | 2,301 | 2,424 | 2,548 |
| Total tangible assets at end of period - Non-GAAP | $ 3,386,860 | $ 3,367,392 | $ 3,274,445 | $ 3,205,393 | $ 3,186,371 |
| Common equity to assets - GAAP | 10.65% | 10.57% | 10.62% | 10.59% | 10.53% |
| Tangible common equity to tangible assets - Non-GAAP | 7.69% | 7.59% | 7.55% | 7.46% | 7.36% |
| Calculation of return on average tangible common equity | |||||
| Net income - GAAP | $ 8,246 | $ 7,781 | $ 7,163 | $ 7,341 | $ 6,617 |
| Total average common stockholders' equity | 370,448 | 363,802 | 356,951 | 351,067 | 343,482 |
| Less: | |||||
| Average goodwill | 109,974 | 109,974 | 109,974 | 110,376 | 110,381 |
| Average other identifiable intangible assets, net | 2,141 | 2,256 | 2,379 | 2,496 | 2,624 |
| Total average tangible common stockholders' equity - Non - GAAP | $ 258,333 | $ 251,572 | $ 244,598 | $ 238,195 | $ 230,477 |
| Return on average common stockholders' equity - GAAP | 8.83% | 8.58% | 8.14% | 8.30% | 7.64% |
| Return on average tangible common stockholders' equity - Non-GAAP | 12.66% | 12.41% | 11.88% | 12.23% | 11.39% |
| Calculation of efficiency ratio | |||||
| Total non-interest expense | $ 19,685 | $ 19,530 | $ 19,742 | $ 20,714 | $ 20,407 |
| Less: | |||||
| Amortization of core deposit intangibles | (111) | (119) | (123) | (124) | (123) |
| Other real estate owned and other repossessed asset (expense) income | (50) | (100) | (15) | (9) | 2 |
| Long-term debt prepayment fee | -- | -- | -- | (683) | -- |
| Merger related expenses | -- | -- | -- | (7) | (744) |
| Provision for unfunded lending commitments, net | (106) | 93 | (11) | (63) | (121) |
| Non-interest expense, as adjusted | $ 19,418 | $ 19,404 | $ 19,593 | $ 19,828 | $ 19,421 |
| Net interest income | $ 28,452 | $ 28,419 | $ 27,845 | $ 27,973 | $ 27,487 |
| Total noninterest income | 4,809 | 4,371 | 4,073 | 5,472 | 4,645 |
| Total revenue | 33,261 | 32,790 | 31,918 | 33,445 | 32,132 |
| Plus: Tax-equivalent adjustment on municipal securities | 235 | 251 | 255 | 248 | 248 |
| Less: | |||||
| Gains on sales investment securities | -- | -- | (2) | (333) | -- |
| Total revenue, as adjusted | $ 33,496 | $ 33,041 | $ 32,171 | $ 33,360 | $ 32,380 |
| Efficiency ratio - Non-GAAP | 57.97% | 58.73% | 60.90% | 59.44% | 59.98% |
| (1) Adjusted for 5% stock dividend paid on June 17, 2014 to shareholders of record June 3, 2014 | |||||
| Lakeland Bancorp, Inc. | ||
| Supplemental Information - Non-GAAP Financial Measures | ||
| (unaudited) | ||
| For the Nine Months Ended, | ||
| September 30, | September 30, | |
| (dollars in thousands, except per share amounts) | 2014 | 2013 |
| Calculation of return on average tangible common equity | ||
| Net income - GAAP | $ 23,190 | $ 17,628 |
| Total average common stockholders' equity | $ 363,783 | $ 310,632 |
| Less: | ||
| Average goodwill | 109,974 | 97,510 |
| Average other identifiable intangible assets, net | 2,257 | 1,182 |
| Total average tangible common stockholders' equity - Non GAAP | $ 251,552 | $ 211,940 |
| Return on average common stockholders' equity - GAAP | 8.52% | 7.59% |
| Return on average tangible common stockholders' equity - Non-GAAP | 12.33% | 11.12% |
| Calculation of efficiency ratio | ||
| Total non-interest expense | $ 58,957 | $ 58,027 |
| Less: | ||
| Amortization of core deposit intangibles | (353) | (164) |
| Other real estate owned and other repossessed asset expense | (165) | (15) |
| Long-term debt prepayment fee | -- | (526) |
| Merger related expenses | -- | (2,827) |
| Provision for unfunded lending commitments | (24) | 8 |
| Non-interest expense, as adjusted | $ 58,415 | $ 54,503 |
| Net interest income | $ 84,716 | $ 76,569 |
| Noninterest income | 13,253 | 15,489 |
| Total revenue | 97,969 | 92,058 |
| Plus: Tax-equivalent adjustment on municipal securities | 741 | 717 |
| Less: | ||
| Gains on investment securities | (2) | (506) |
| Gains on extinguishment of debt | -- | (1,197) |
| Total revenue, as adjusted | $ 98,708 | $ 91,072 |
| Efficiency ratio - Non - GAAP | 59.18% | 59.85% |