BOSTON, Jan. 26, 2015 (GLOBE NEWSWIRE) -- Meridian Bancorp, Inc. (the "Company" or "Meridian") (Nasdaq:EBSB), the holding company for East Boston Savings Bank (the "Bank") announced net income of $6.0 million, or $0.11 per diluted share, for the quarter ended December 31, 2014 compared to $4.0 million, or $0.07 per diluted share, for the quarter ended December 31, 2013. For the year ended December 31, 2014, net income was $22.3 million, or $0.42 per diluted share compared to $15.4 million, or $0.29 per diluted share, for the year ended December 31, 2013. The Company's return on average assets was 0.75% for the quarter ended December 31, 2014 compared to 0.60% for the quarter ended December 31, 2013. For the year ended December 31, 2014, the Company's return on average assets was 0.75% compared to 0.62% for the year ended December 31, 2013. The Company's return on average equity was 4.19% for the quarter ended December 31, 2014 compared to 6.49% for the quarter ended December 31, 2013. For the year ended December 31, 2014, the Company's return on average equity was 5.69% compared to 6.39% for the year ended December 31, 2013. Total assets increased $596.4 million, or 22.2%, to $3.279 billion at December 31, 2014 from $2.682 billion at December 31, 2013 and total stockholders' equity increased $328.5 million, or 131.8%, to $577.7 million at December 31, 2014, from $249.2 million at December 31, 2013, each reflecting net cash proceeds of $302.3 million raised in the Company's second step common stock offering completed on July 28, 2014. As a result of the completion of the second-step common stock offering, all historical share and per share information has been restated to reflect the 2.4484-to-one exchange ratio.
Richard J. Gavegnano, Chairman, President and Chief Executive Officer, said, "I am pleased to report net income of $6.0 million, or $0.11 per diluted share, for the fourth quarter of 2014, a 50% rise from the fourth quarter of 2013, and a record $22.3 million, or $0.42 per diluted share, for all of 2014, a 45% rise from 2013. We achieved several important milestones during the year, starting with the third quarter completion of our second-step common stock offering that raised $325 million of gross proceeds and increased our total assets to over $3 billion. At year end, total loans increased to nearly $2.7 billion, reflecting net growth of $387 million, while total deposits reached $2.5 billion reflecting net growth of $255 million. As a result, net interest income rose 17% and our efficiency ratio improved to below 69% for 2014. With our much stronger capital base, we are continuing to emphasize commercial lending and core deposit growth as we strive to enhance our franchise footprint that includes ongoing consideration of new locations for branches and lending expansion opportunities in attractive greater Boston markets."
Net interest income increased $3.6 million, or 17.9%, to $23.6 million for the quarter ended December 31, 2014 from $20.0 million for the quarter ended December 31, 2013. The interest rate spread and net interest margin on a tax-equivalent basis were 2.91% and 3.13%, respectively, for the quarter ended December 31, 2014 compared to 3.05% and 3.20%, respectively, for the quarter ended December 31, 2013. For the year ended December 31, 2014, net interest income increased $13.1 million, or 17.4%, to $88.2 million from $75.1 million for the year ended December 31, 2013. The net interest rate spread and net interest margin on a tax-equivalent basis were 3.00% and 3.19%, respectively, for the year ended December 31, 2014 compared to 3.08% and 3.23%, respectively, for the year ended December 31, 2013. The increases in net interest income were due primarily to loan growth along with declines in the cost of funds, partially offset by declines in yields on interest-earning assets and deposit growth for the fourth quarter and year ended December 31, 2014 compared to the same periods in 2013.
The Company's yield on interest-earning assets on a tax-equivalent basis declined 17 basis points to 3.91% for the year ended December 31, 2014 compared to 4.08% for the year ended December 31, 2013, while the cost of funds declined 10 basis points to 0.80% for the year ended December 31, 2014 compared to 0.90% for the year ended December 31, 2013. An increase in interest income on loans was the result of growth in the Company's average loan balances of $416.9 million, or 20.7%, to $2.428 billion, partially offset by the decline of yield on loans on a tax-equivalent basis of 12 basis points to 4.39% for the year ended December 31, 2014 compared to the year ended December 31, 2013. An increase in interest expense on deposits was the result of growth in total deposits of $315.8 million, or 15.3%, to $2.377 billion, partially offset by the decline in the cost of total deposits of seven basis points to 0.76% for the year ended December 31, 2014 compared to 0.83% for the year ended December 31, 2013.
Mr. Gavegnano noted, "Our net interest income has risen each quarter for three and a half years, while loans and core deposits more than doubled during that time. Our loan yields have stabilized and our net interest margin rose slightly during the fourth quarter of 2014, following a slight decline in the margin during the third quarter as a result of the net cash proceeds from our stock offering. As we continue to deploy those proceeds through continued growth, we expect to see further increases in our net interest margin."
The Company's provision for loan losses was $1.8 million for both quarters ended December 31, 2014 and 2013. For the year ended December 31, 2014, the provision for loan losses was $3.3 million compared to $6.5 million for the year ended December 31, 2013. The change was based on management's assessment of loan portfolio growth and composition changes, a decline in historical charge-off trends, an ongoing evaluation of credit quality and improving economic conditions. The allowance for loan losses was $28.5 million or 1.06% of total loans outstanding at December 31, 2014, compared to $25.3 million or 1.11% of total loans outstanding at December 31, 2013. Net charge-offs totaled $100,000 for the quarter ended December 31, 2014, or 0.02% of average loans outstanding, and $179,000 for the year ended December 31, 2014, or 0.01% of average loans outstanding.
Non-accrual loans decreased $10.0 million, or 24.1%, to $31.5 million, or 1.18% of total loans outstanding, at December 31, 2014, from $41.5 million, or 1.81% of total loans outstanding, at December 31, 2013, primarily due to decreases of $3.7 million in non-accrual commercial real estate loans, $3.0 million in non-accrual one- to four-family loans and $2.9 million in non-accrual construction loans. Non-performing assets decreased $10.4 million, or 24.2%, to $32.6 million, or 0.99% of total assets, at December 31, 2014, from $42.9 million, or 1.60% of total assets, at December 31, 2013. Non-performing assets at December 31, 2014 were comprised of $14.6 million of one- to four-family mortgage loans, $8.4 million of construction loans, $5.3 million of commercial real estate loans, $2.3 million of home equity loans, $855,000 of commercial business loans and foreclosed real estate of $1.0 million.
Mr. Gavegnano commented, "Our asset quality trends continued to improve in 2014, with the ratios of non-performing assets to total assets declining to 0.99% at year end from our high of 2.91% at the end of 2011 and net charge-offs to average loans declining to 0.01%, our lowest level on record. We remain committed to maintaining solid credit quality as we continue to focus on commercial lending growth."
Non-interest income decreased $753,000, or 14.8%, to $4.3 million for the quarter ended December 31, 2014 from $5.1 million for the quarter ended December 31, 2013, primarily due to decreases of $393,000 in gain on sales of securities, net and $355,000 in other income. For the year ended December 31, 2014, non-interest income decreased $3.4 million, or 17.3%, to $16.1 million from $19.4 million for the year ended December 31, 2013, primarily due to decreases of $3.4 million in gain on sales of securities, net and $347,000 in other income, partially offset by an increase of $363,000 in customer service fees. The decreases in other income were primarily due to loan swap income recognized in the fourth quarter of 2013.
Non-interest expenses decreased $16,000, or 0.1%, to $17.0 million for the quarter ended December 31, 2014 as compared to the quarter ended December 31, 2013, primarily due to decreases of $270,000 in marketing and advertising and $136,000 in professional services, partially offset by increases of $306,000 in salaries and employee benefits and $130,000 in data processing. For the year ended December 31, 2014, non-interest expenses increased $2.9 million, or 4.5%, to $67.4 million from $64.5 million for the year ended December 31, 2013, primarily due to increases of $1.8 million in salaries and employee benefits, $460,000 in occupancy and equipment, $242,000 in data processing, $161,000 in professional services and $278,000 in other general and administrative expenses. The increases in salaries and employee benefits and occupancy and equipment expenses were primarily associated with the opening of three new branches in 2013 and costs associated with the expansion of residential and commercial lending capacity. The Company's efficiency ratio was 65.21% for the quarter ended December 31, 2014 compared to 74.45% for the quarter ended December 31, 2013. For the year ended December 31, 2014, the efficiency ratio was 68.84% compared to 76.04% for the year ended December 31, 2013.
Mr. Gavegnano added, "We are gratified by the significant improvement in our efficiency ratio during 2014 driven by strong loan growth and the resulting increases in net interest income along with prudent control of overhead expenses. Historically, gains on sales of securities have been one of our recurring sources of earnings, so I believe it is important to note that these gains are not included in the calculation of the efficiency ratio. If such gains were included, the efficiency ratio would have been 60.91% for the fourth quarter of 2014 compared to 67.82% for the fourth quarter of 2013, and 64.70% for the year 2014 compared to 68.28% for the year 2013."
The Company recorded a provision for income taxes of $3.1 million for the quarter ended December 31, 2014, reflecting an effective tax rate of 33.7%, compared to $2.2 million, or 35.7%, for the quarter ended December 31, 2013. For the year ended December 31, 2014, the provision for income taxes was $11.1 million, reflecting an effective tax rate of 33.3%, compared to $8.1 million, or 34.3%, for the year ended December 31, 2013. The change in the effective tax rate was primarily due to changes in the components of pre-tax income.
Net loans increased $383.5 million, or 16.9%, to $2.649 billion at December 31, 2014 from $2.265 billion at December 31, 2013. The net increase in loans for the year ended December 31, 2014 was primarily due to increases of $174.9 million in commercial real estate loans, $83.7 million in commercial business loans, $60.1 million in multi-family loans and $57.2 million in construction loans. Cash and due from banks increased $119.5 million, or 138.5%, to $205.7 million at December 31, 2014 from $86.3 million at December 31, 2013. The increase in cash and due from banks was primarily due to $302.3 million of net cash proceeds raised in the Company's second-step common stock offering. Additional net cash proceeds from the stock offering were invested in certificates of deposit and securities available for sale. Securities available for sale increased $2.4 million, or 1.2%, to $203.5 million at December 31, 2014 from $201.1 million at December 31, 2013.
Total deposits increased $255.3 million, or 11.4%, to $2.504 billion at December 31, 2014 from $2.249 billion at December 31, 2013. Core deposits, which exclude certificate of deposits, increased $223.1 million, or 14.2%, to $1.796 billion, or 71.7% of total deposits, at December 31, 2014. Total borrowings increased $10.0 million, or 6.2%, to $171.9 million at December 31, 2014 from $161.9 million at December 31, 2013.
Total stockholders' equity increased $328.5 million, or 131.8%, to $577.7 million at December 31, 2014, from $249.2 million at December 31, 2013. The increase for the year ended December 31, 2014 was primarily the result of the Company's second-step common stock offering and $22.3 million in net income, partially offset by a decrease of $1.2 million in accumulated other comprehensive income reflecting a decrease in the fair value of available for sale securities. Stockholders' equity to assets was 17.62% at December 31, 2014, compared to 9.29% at December 31, 2013. Book value per share increased to $10.56 at December 31, 2014 from $4.58 at December 31, 2013. Tangible book value per share increased to $10.31 at December 31, 2014 from $4.33 at December 31, 2013. Market price per share increased $2.00, or 21.7%, to $11.22 at December 31, 2014 from $9.22 at December 31, 2013. At December 31, 2014, the Company and the Bank continued to exceed all regulatory capital requirements.
Meridian Bancorp, Inc. is the holding company for East Boston Savings Bank. East Boston Savings Bank, a Massachusetts-chartered stock savings bank founded in 1848, operates 27 full service locations in the greater Boston metropolitan area. We offer a variety of deposit and loan products to individuals and businesses located in our primary market, which consists of Essex, Middlesex and Suffolk Counties, Massachusetts. For additional information, visit www.ebsb.com.
Forward Looking Statements
Certain statements herein constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements may be identified by words such as "believes," "will," "expects," "project," "may," "could," "developments," "strategic," "launching," "opportunities," "anticipates," "estimates," "intends," "plans," "targets" and similar expressions. These statements are based upon the current beliefs and expectations of Meridian Bancorp, Inc.'s management and are subject to significant risks and uncertainties. Actual results may differ materially from those set forth in the forward-looking statements as a result of numerous factors. Factors that could cause such differences to exist include, but are not limited to, general economic conditions, changes in interest rates, regulatory considerations, and competition and the risk factors described in the Company's Annual Report on Form 10-K and Quarterly Reports on Form 10-Q as filed with the Securities and Exchange Commission. Should one or more of these risks materialize or should underlying beliefs or assumptions prove incorrect, Meridian Bancorp, Inc.'s actual results could differ materially from those discussed. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this release.
| MERIDIAN BANCORP, INC. AND SUBSIDIARIES | ||
| Consolidated Balance Sheets | ||
| (Unaudited) | ||
| December 31, | ||
| 2014 | 2013 | |
| (Dollars in thousands) | ||
| ASSETS | ||
| Cash and due from banks | $ 205,732 | $ 86,271 |
| Certificates of deposit | 85,000 | -- |
| Securities available for sale, at fair value | 203,521 | 201,137 |
| Federal Home Loan Bank stock, at cost | 12,725 | 11,907 |
| Loans held for sale | 971 | 2,363 |
| Loans, net of fees and costs | 2,677,376 | 2,290,735 |
| Less allowance for loan losses | (28,469) | (25,335) |
| Loans, net | 2,648,907 | 2,265,400 |
| Bank-owned life insurance | 38,611 | 37,446 |
| Foreclosed real estate, net | 1,046 | 1,390 |
| Premises and equipment, net | 38,512 | 39,426 |
| Accrued interest receivable | 7,748 | 7,127 |
| Deferred tax asset, net | 15,610 | 13,478 |
| Goodwill | 13,687 | 13,687 |
| Other assets | 6,456 | 2,469 |
| Total assets | $ 3,278,526 | $ 2,682,101 |
| LIABILITIES AND STOCKHOLDERS' EQUITY | ||
| Deposits: | ||
| Non interest-bearing | $ 285,990 | $ 255,639 |
| Interest-bearing | 2,217,945 | 1,992,961 |
| Total deposits | 2,503,935 | 2,248,600 |
| Long-term debt | 171,899 | 161,903 |
| Accrued expenses and other liabilities | 24,982 | 22,393 |
| Total liabilities | 2,700,816 | 2,432,896 |
| Stockholders' equity: | ||
| Preferred stock, $0.01 par value, 50,000,000 shares authorized; | ||
| none issued | -- | -- |
| Common stock, $0.01 par value, 100,000,000 shares authorized | ||
| and 54,708,066 shares issued at December 31, 2014; no par | ||
| value, 100,000,000 shares authorized and 56,313,200 shares | ||
| issued at December 31, 2013 (1) | 547 | -- |
| Additional paid-in capital | 411,476 | 99,553 |
| Retained earnings | 184,715 | 162,388 |
| Accumulated other comprehensive income | 2,898 | 4,104 |
| Treasury stock, at cost; 1,906,865 (1) shares at December 31, 2013 | -- | (9,919) |
| Unearned compensation - ESOP, 2,922,328 and 1,419,093 (1) shares | ||
| at December 31, 2014 and 2013, respectively | (21,164) | (5,796) |
| Unearned compensation - restricted shares, 138,838 and 254,168 (1) | ||
| at December 31, 2014 and 2013, respectively | (762) | (1,125) |
| Total stockholders' equity | 577,710 | 249,205 |
| Total liabilities and stockholders' equity | $ 3,278,526 | $ 2,682,101 |
| (1) Share amounts related to periods prior to the date of completion of the Conversion (July 28, 2014) have been restated to give retroactive recognition to the exchange ratio applied in the Conversion (2.4484-to-one). | ||
| MERIDIAN BANCORP, INC. AND SUBSIDIARIES | ||||
| Consolidated Statements of Net Income | ||||
| (Unaudited) | ||||
| Three Months Ended December 31, | Years Ended December 31, | |||
| 2014 | 2013 (1) | 2014 | 2013 (1) | |
| (Dollars in thousands, except per share amounts) | ||||
| Interest and dividend income: | ||||
| Interest and fees on loans | $ 27,650 | $ 23,936 | $ 103,814 | $ 89,349 |
| Interest on debt securities: | ||||
| Taxable | 505 | 812 | 2,468 | 3,919 |
| Tax-exempt | 44 | 50 | 178 | 209 |
| Dividends on equity securities | 378 | 322 | 1,425 | 1,383 |
| Interest on certificates of deposit | 47 | -- | 47 | -- |
| Other interest and dividend income | 261 | 93 | 747 | 344 |
| Total interest and dividend income | 28,885 | 25,213 | 108,679 | 95,204 |
| Interest expense: | ||||
| Interest on deposits | 4,716 | 4,537 | 18,041 | 17,053 |
| Interest on borrowings | 564 | 649 | 2,472 | 3,082 |
| Total interest expense | 5,280 | 5,186 | 20,513 | 20,135 |
| Net interest income | 23,605 | 20,027 | 88,166 | 75,069 |
| Provision for loan losses | 1,829 | 1,840 | 3,313 | 6,470 |
| Net interest income, after provision for loan losses | 21,776 | 18,187 | 84,853 | 68,599 |
| Non-interest income: | ||||
| Customer service fees | 1,953 | 1,910 | 7,492 | 7,129 |
| Loan fees | 124 | 159 | 591 | 508 |
| Mortgage banking gains, net | 126 | 127 | 532 | 583 |
| Gain on sales of securities, net | 1,847 | 2,240 | 6,258 | 9,636 |
| Income from bank-owned life insurance | 297 | 309 | 1,165 | 1,195 |
| Other income | 1 | 356 | 18 | 365 |
| Total non-interest income | 4,348 | 5,101 | 16,056 | 19,416 |
| Non-interest expenses: | ||||
| Salaries and employee benefits | 10,340 | 10,034 | 41,407 | 39,618 |
| Occupancy and equipment | 2,229 | 2,275 | 9,258 | 8,798 |
| Data processing | 1,245 | 1,115 | 4,516 | 4,274 |
| Marketing and advertising | 637 | 907 | 2,901 | 2,949 |
| Professional services | 581 | 717 | 2,469 | 2,308 |
| Foreclosed real estate | 275 | 318 | 438 | 479 |
| Deposit insurance | 534 | 531 | 2,131 | 2,053 |
| Other general and administrative | 1,184 | 1,144 | 4,314 | 4,036 |
| Total non-interest expenses | 17,025 | 17,041 | 67,434 | 64,515 |
| Income before income taxes | 9,099 | 6,247 | 33,475 | 23,500 |
| Provision for income taxes | 3,062 | 2,232 | 11,148 | 8,071 |
| Net income | $ 6,037 | $ 4,015 | $ 22,327 | $ 15,429 |
| Earnings per share: | ||||
| Basic | $ 0.12 | $ 0.08 | $ 0.43 | $ 0.29 |
| Diluted | $ 0.11 | $ 0.07 | $ 0.42 | $ 0.29 |
| Weighted average shares: | ||||
| Basic | 51,734,726 | 52,954,407 | 52,470,513 | 52,976,873 |
| Diluted | 52,874,822 | 53,952,120 | 53,567,771 | 53,834,952 |
| (1) Share and per share amounts related to periods prior to the date of completion of the Conversion (July 28, 2014) have been restated to give retroactive recognition to the exchange ratio applied in the Conversion (2.4484-to-one). | ||||
| MERIDIAN BANCORP, INC. AND SUBSIDIARIES | |||||||||||
| Net Interest Income Analysis | |||||||||||
| (Unaudited) | |||||||||||
| Three Months Ended December 31, | |||||||||||
| 2014 | 2013 | ||||||||||
| Average | Yield/ | Average | Yield/ | ||||||||
| Balance | Interest (1) | Cost (1)(2) | Balance | Interest (1) | Cost (1)(2) | ||||||
| (Dollars in thousands) | |||||||||||
| Assets: | |||||||||||
| Interest-earning assets: | |||||||||||
| Loans (3) | $ 2,566,110 | $ 28,413 | 4.39% | $ 2,199,584 | $ 24,371 | 4.40% | |||||
| Securities and certificates of deposits | 179,412 | 1,135 | 2.51 | 206,051 | 1,326 | 2.55 | |||||
| Other interest-earning assets (4) | 361,295 | 261 | 0.29 | 147,805 | 93 | 0.25 | |||||
| Total interest-earning assets | 3,106,817 | 29,809 | 3.81 | 2,553,440 | 25,790 | 4.01 | |||||
| Noninterest-earning assets | 123,467 | 113,662 | |||||||||
| Total assets | $ 3,230,284 | $ 2,667,102 | |||||||||
| Liabilities and stockholders' equity: | |||||||||||
| Interest-bearing liabilities: | |||||||||||
| NOW deposits | $ 285,031 | 462 | 0.64 | $ 205,243 | 280 | 0.54 | |||||
| Money market deposits | 922,400 | 2,082 | 0.90 | 838,135 | 1,916 | 0.91 | |||||
| Regular and other deposits | 270,746 | 175 | 0.26 | 256,644 | 169 | 0.26 | |||||
| Certificates of deposit | 687,511 | 1,997 | 1.15 | 680,682 | 2,172 | 1.27 | |||||
| Total interest-bearing deposits | 2,165,688 | 4,716 | 0.86 | 1,980,704 | 4,537 | 0.91 | |||||
| Borrowings | 172,169 | 564 | 1.30 | 166,734 | 649 | 1.54 | |||||
| Total interest-bearing liabilities | 2,337,857 | 5,280 | 0.90 | 2,147,438 | 5,186 | 0.96 | |||||
| Noninterest-bearing demand deposits | 292,580 | 252,299 | |||||||||
| Other noninterest-bearing liabilities | 24,080 | 19,890 | |||||||||
| Total liabilities | 2,654,517 | 2,419,627 | |||||||||
| Total stockholders' equity | 575,767 | 247,475 | |||||||||
| Total liabilities and stockholders' equity | $ 3,230,284 | $ 2,667,102 | |||||||||
| Net interest-earning assets | $ 768,960 | $ 406,002 | |||||||||
| Fully tax-equivalent net interest income | 24,529 | 20,604 | |||||||||
| Less: tax-equivalent adjustments | (924) | (577) | |||||||||
| Net interest income | $ 23,605 | $ 20,027 | |||||||||
| Interest rate spread (1)(5) | 2.91% | 3.05% | |||||||||
| Net interest margin (1)(6) | 3.13% | 3.20% | |||||||||
| Average interest-earning assets to average | |||||||||||
| interest-bearing liabilities | 132.89% | 118.91% | |||||||||
| Supplemental Information: | |||||||||||
| Total deposits, including noninterest-bearing | |||||||||||
| demand deposits | $ 2,458,268 | $ 4,716 | 0.76% | $ 2,233,003 | $ 4,537 | 0.81% | |||||
| Total deposits and borrowings, including | |||||||||||
| noninterest-bearing demand deposits | $ 2,630,437 | $ 5,280 | 0.80% | $ 2,399,737 | $ 5,186 | 0.86% | |||||
| (1) Income on debt securities, equity securities and revenue bonds included in commercial real estate loans, resulting yields, and interest rate spread and net interest margin, are presented on a tax-equivalent basis. The tax-equivalent adjustments are deducted from tax-equivalent net interest income to agree to amounts reported in the consolidated statements of net income. For the three months ended December 31, 2014 and 2013, yields on loans before tax-equivalent adjustments were 4.27% and 4.32%, respectively, yields on securities and certificates of deposit before tax-equivalent adjustments were 2.15% and 2.28%, respectively, and yield on total interest-earning assets before tax-equivalent adjustments were 3.69% and 3.92%, respectively. Interest rate spread before tax-equivalent adjustments for the three months ended December 31, 2014 and 2013 was 2.79% and 2.96%, respectively, while net interest margin before tax-equivalent adjustments for the three months ended December 31, 2014 and 2013 was 3.01% and 3.11%, respectively. | |||||||||||
| (2) Annualized. | |||||||||||
| (3) Loans on non-accrual status are included in average balances. | |||||||||||
| (4) Includes Federal Home Loan Bank stock and associated dividends. | |||||||||||
| (5) Interest rate spread represents the difference between the tax-equivalent yield on interest-earning assets and the cost of interest-bearing liabilities. | |||||||||||
| (6) Net interest margin represents net interest income (tax-equivalent basis) divided by average interest-earning assets. | |||||||||||
| MERIDIAN BANCORP, INC. AND SUBSIDIARIES | |||||||||||
| Net Interest Income Analysis | |||||||||||
| (Unaudited) | |||||||||||
| Years Ended December 31, | |||||||||||
| 2014 | 2013 | ||||||||||
| Average | Yield/ | Average | Yield/ | ||||||||
| Balance | Interest (1) | Cost (1) | Balance | Interest (1) | Cost (1) | ||||||
| (Dollars in thousands) | |||||||||||
| Assets: | |||||||||||
| Interest-earning assets: | |||||||||||
| Loans (2) | $ 2,427,538 | $ 106,519 | 4.39% | $ 2,010,624 | $ 90,680 | 4.51% | |||||
| Securities and certificates of deposits | 188,543 | 4,732 | 2.51 | 227,695 | 6,122 | 2.69 | |||||
| Other interest-earning assets (3) | 249,482 | 747 | 0.30 | 144,689 | 344 | 0.24 | |||||
| Total interest-earning assets | 2,865,563 | 111,998 | 3.91 | 2,383,008 | 97,146 | 4.08 | |||||
| Noninterest-earning assets | 113,464 | 117,506 | |||||||||
| Total assets | $ 2,979,027 | $ 2,500,514 | |||||||||
| Liabilities and stockholders' equity: | |||||||||||
| Interest-bearing liabilities: | |||||||||||
| NOW deposits | $ 249,919 | 1,489 | 0.60 | $ 187,426 | 994 | 0.53 | |||||
| Money market deposits | 879,211 | 7,812 | 0.89 | 718,159 | 6,530 | 0.91 | |||||
| Regular and other deposits | 267,145 | 690 | 0.26 | 252,723 | 663 | 0.26 | |||||
| Certificates of deposit | 678,443 | 8,050 | 1.19 | 676,345 | 8,866 | 1.31 | |||||
| Total interest-bearing deposits | 2,074,718 | 18,041 | 0.87 | 1,834,653 | 17,053 | 0.93 | |||||
| Borrowings | 189,247 | 2,472 | 1.31 | 179,708 | 3,082 | 1.72 | |||||
| Total interest-bearing liabilities | 2,263,965 | 20,513 | 0.91 | 2,014,361 | 20,135 | 1.00 | |||||
| Noninterest-bearing demand deposits | 302,417 | 226,691 | |||||||||
| Other noninterest-bearing liabilities | 20,325 | 17,924 | |||||||||
| Total liabilities | 2,586,707 | 2,258,976 | |||||||||
| Total stockholders' equity | 392,320 | 241,538 | |||||||||
| Total liabilities and stockholders' equity | $ 2,979,027 | $ 2,500,514 | |||||||||
| Net interest-earning assets | $ 601,598 | $ 368,647 | |||||||||
| Fully tax-equivalent net interest income | 91,485 | 77,011 | |||||||||
| Less: tax-equivalent adjustments | (3,319) | (1,942) | |||||||||
| Net interest income | $ 88,166 | $ 75,069 | |||||||||
| Interest rate spread (1)(4) | 3.00% | 3.08% | |||||||||
| Net interest margin (1)(5) | 3.19% | 3.23% | |||||||||
| Average interest-earning assets to average | |||||||||||
| interest-bearing liabilities | 126.57% | 118.30% | |||||||||
| Supplemental Information: | |||||||||||
| Total deposits, including noninterest-bearing | |||||||||||
| demand deposits | $ 2,377,135 | $ 18,041 | 0.76% | $ 2,061,344 | $ 17,053 | 0.83% | |||||
| Total deposits and borrowings, including | |||||||||||
| noninterest-bearing demand deposits | $ 2,566,382 | $ 20,513 | 0.80% | $ 2,241,052 | $ 20,135 | 0.90% | |||||
| (1) Income on debt securities, equity securities and revenue bonds included in commercial real estate loans, resulting yields, and interest rate spread and net interest margin, are presented on a tax-equivalent basis. The tax-equivalent adjustments are deducted from tax-equivalent net interest income to agree to amounts reported in the consolidated statements of net income. For the years ended December 31, 2014 and 2013, yields on loans before tax-equivalent adjustments were 4.28% and 4.44%, respectively, yields on securities and certificates of deposit before tax-equivalent adjustments were 2.18% and 2.42%, respectively, and yield on total interest-earning assets before tax-equivalent adjustments were 3.79% and 4.00%, respectively. Interest rate spread before tax-equivalent adjustments for the years ended December 31, 2014 and 2013 was 2.88% and 3.00%, respectively, while net interest margin before tax-equivalent adjustments for the years ended December 31, 2014 and 2013 was 3.08% and 3.15%, respectively. | |||||||||||
| (2) Loans on non-accrual status are included in average balances. | |||||||||||
| (3) Includes Federal Home Loan Bank stock and associated dividends. | |||||||||||
| (4) Interest rate spread represents the difference between the tax-equivalent yield on interest-earning assets and the cost of interest-bearing liabilities. | |||||||||||
| (5) Net interest margin represents net interest income (tax-equivalent basis) divided by average interest-earning assets. | |||||||||||
| MERIDIAN BANCORP, INC. AND SUBSIDIARIES | ||||
| Selected Financial Highlights | ||||
| (Unaudited) | ||||
| At or For the Three Months Ended | At or For the Years Ended | |||
| December 31, | December 31, | |||
| 2014 | 2013 | 2014 | 2013 | |
| Key Performance Ratios | ||||
| Return on average assets (1) | 0.75% | 0.60% | 0.75% | 0.62% |
| Return on average equity (1) | 4.19 | 6.49 | 5.69 | 6.39 |
| Stockholders' equity to total assets | 17.62 | 9.29 | 17.62 | 9.29 |
| Interest rate spread (1) (2) | 2.91 | 3.05 | 3.00 | 3.08 |
| Net interest margin (1) (3) | 3.13 | 3.20 | 3.19 | 3.23 |
| Non-interest expense to average assets (1) | 2.11 | 2.56 | 2.26 | 2.58 |
| Efficiency ratio (4) | 65.21 | 74.45 | 68.84 | 76.04 |
| December 31, | December 31, | |||
| 2014 | 2013 (5) | |||
| Asset Quality Ratios | ||||
| Allowance for loan losses/total loans | 1.06% | 1.11% | ||
| Allowance for loan losses/non-accrual loans | 90.35 | 61.00 | ||
| Non-accrual loans/total loans | 1.18 | 1.81 | ||
| Non-accrual loans/total assets | 0.96 | 1.55 | ||
| Non-performing assets/total assets | 0.99 | 1.60 | ||
| Share Related | ||||
| Book value per share | $ 10.56 | $ 4.58 | ||
| Tangible book value per share | $ 10.31 | $ 4.33 | ||
| Market value per share | $ 11.22 | $ 9.22 | ||
| Shares outstanding | 54,708,066 | 54,406,335 | ||
| (1) Annualized. | ||||
| (2) Interest rate spread represents the difference between the tax-equivalent yield on interest-earning assets and the cost of interest-bearing liabilities. | ||||
| (3) Net interest margin represents net interest income (tax-equivalent basis) divided by average interest-earning assets. | ||||
| (4) The efficiency ratio represents non-interest expense divided by the sum of net interest income and non-interest income excluding gains or losses on securities. | ||||
| (5) Share and per share amounts related to periods prior to the date of completion of the Conversion (July 28, 2014) have been restated to give retroactive recognition to the exchange ratio applied in the Conversion (2.4484-to-one). | ||||