Bryn Mawr Bank Corporation Reports Record Quarterly Net Income of $10.7 Million, Driven by Strong Net Interest Income, Noninterest Income and Expense Control, Declares Dividend of $0.22

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| Source: BMT

BRYN MAWR, Pa., Oct. 19, 2017 (GLOBE NEWSWIRE) -- Bryn Mawr Bank Corporation (NASDAQ:BMTC) (the “Corporation”), parent of The Bryn Mawr Trust Company (the “Bank”), today reported net income of $10.7 million and diluted earnings per share of $0.62 for the three months ended September 30, 2017, as compared to net income of $9.4 million, or $0.55 diluted earnings per share, for the three months ended June 30, 2017, and $9.4 million, or $0.55 diluted earnings per share, for the three months ended September 30, 2016. Included in net income for the three months ended September 30, 2017 and June 30, 2017 were pre-tax due diligence and merger-related expenses of $850 thousand and $1.2 million, respectively, primarily related to the pending merger with Royal Bancshares of Pennsylvania, Inc. (“Royal Bank”).

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 $11.2 million, or $0.65 diluted earnings per share, for the three months ended September 30, 2017 as compared to $10.2 million, or $0.59 diluted earnings per share, for the three months ended June 30, 2017 and $9.4 million, or $0.55 diluted earnings per share, for the three months ended September 30, 2016. 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.

“The Corporation continued to produce solid results in the quarter, benefiting from our focus on new business development and the strategic investments we have made over the last few years in both revenue generation as well as enabling technologies,” commented Frank Leto, President and Chief Executive Officer, adding, “As a result, we saw growth in both net interest income as well as fee income during the quarter with very little increase in expenses, net of merger costs, driving our return on average equity over one percent higher in the quarter, when compared to last quarter.”

Mr. Leto continued, “The preparations for the merger with Royal Bank continue as we await final regulatory approval. Staff and management have been working diligently to ensure a smooth transition and we expect the transaction to close during the fourth quarter of 2017”. In addition to regulatory approval, the merger with Royal Bank is subject to certain closing conditions.

On October 19, 2017, the Board of Directors of the Corporation declared a quarterly dividend of $0.22 per share, payable December 1, 2017 to shareholders of record as of November 1, 2017.

SIGNIFICANT ITEMS OF NOTE
Results of Operations – Third Quarter 2017 Compared to Second Quarter 2017

  • Net income for the three months ended September 30, 2017 was $10.7 million, or $0.62 diluted earnings per share, as compared to $9.4 million, or $0.55 diluted earnings per share for the three months ended June 30, 2017. Contributing to the increase was a $1.5 million increase in net interest income, a $430 thousand increase in insurance revenues and a $279 thousand increase in gain on sale of loans. In addition to these improving revenue items, linked-quarter decreases of $386 thousand and $310 thousand in due diligence and merger-related expenses and professional fees, respectively, contributed to the improvement in net income. The decrease in the effective tax rate from 34.2% for the second quarter of 2017 to 30.7% for the third quarter of 2017 was the result of a $581 thousand increase in excess tax benefit primarily related to the vesting of restricted stock awards during the third quarter of 2017. Partially offsetting these positive changes to net income was a $1.4 million increase in the provision for loan and lease losses (the “Provision”) from the second quarter to the third quarter of 2017.
     
  • Tax-equivalent net interest income for the three months ended September 30, 2017 was $29.6 million, an increase of $1.5 million, or 5.2%, from $28.1 million for the three months ended June 30, 2017.  The accretion of purchase accounting adjustments increased the tax-equivalent net interest income recorded for the third quarter of 2017 by $753 thousand, as compared to an increase of $450 thousand for the three months ended June 30, 2017. 
     
    Average loans and leases for the three months ended September 30, 2017 increased by $64.7 million from the three months ended June 30, 2017 and experienced an eleven basis point increase in tax-equivalent yield. The increase in the prime rate, which occurred toward the end of the second quarter, contributed to the increase in tax-equivalent yield on loans, as did the accretion of purchase accounting adjustments, which totaled $708 thousand for the third quarter of 2017 as compared to $402 thousand for the second quarter of 2017. Excluding the effect of the accretion of purchase accounting adjustments on loans and leases, the tax-equivalent yield on loans and leases increased by seven basis points on a linked-quarter basis. The net effect of the yield and volume increases on average loans and leases was a $1.7 million increase in tax-equivalent interest income on loans and leases from the second quarter of 2017 to the third quarter of 2017.

    Average available for sale investment securities increased by $32.3 million for the three months ended September 30, 2017 as compared to the three months ended June 30, 2017, and experienced a one basis point tax-equivalent yield increase. The increase in volume and yield on available for sale investment securities resulted in a $204 thousand increase in tax-equivalent interest income for the third quarter of 2017 as compared to the second quarter of 2017.

    Partially offsetting the increase in average loans and leases and available for sale investment securities was a $17.8 million increase in average interest-bearing deposits accompanied by a four basis point increase in rate paid on deposits resulting in a $215 thousand increase in interest expense on deposits for the third quarter of 2017 as compared to the second quarter of 2017. In addition to the increase in average deposits, average borrowings increased $68.3 million for the three months ended September 30, 2017 as compared to the three months ended June 30, 2017, with the rate paid decreasing by four basis points. The volume increase and rate decrease resulted in a $273 thousand increase in interest expense on borrowings on a linked-quarter basis.
  • The tax-equivalent net interest margin of 3.71% for the third quarter of 2017 increased three basis points from 3.68% for the second quarter of 2017.  During the third quarter of 2017, the accretion of purchase accounting adjustments contributed nine basis points to the tax-equivalent net interest margin as compared to a contribution of six basis points for the three months ended June 30, 2017.  As a result, excluding the effect of the accretion of purchase accounting adjustments, the tax-equivalent net interest margin remained unchanged on a linked-quarter basis.
     
  • Noninterest income for the three months ended September 30, 2017 increased by $799 thousand from the second quarter of 2017. Largely contributing to this increase was an increase of $430 thousand in insurance revenues, as the impact of the May 24, 2017 acquisition of Hirshorn Boothby was experienced for a full quarter, and a $279 thousand increase in gain on sale of loans, primarily related to the sale of SBA-guaranteed loans. Partially offsetting these increases were decreases of $156 thousand in fees for wealth management services, as some of the fees for tax-related services during the second quarter of 2017 were not repeated in the third quarter, and a $110 thousand linked-quarter decrease in capital markets revenue.
     
  • Noninterest expense for the three months ended September 30, 2017 decreased $311 thousand, to $28.2 million, as compared to $28.5 million for the second quarter of 2017. The $310 thousand decrease in professional fees was partially related to second quarter 2017 initial start-up costs associated with BMT Investment Advisers, a subsidiary established to advise the Corporation’s new proprietary mutual fund, the BMT Multi-Cap Fund (MUTF:BMTMX). In addition, due diligence and merger-related expenses decreased by $386 thousand between the periods. These decreases were partially offset by increases of $238 thousand and $211 thousand in occupancy and bank premises expense and other operating expenses, respectively.
     
  • For the three months ended September 30, 2017, net loan and lease charge-offs totaled $728 thousand, as compared to $625 thousand for the second quarter of 2017. The Provision for the three months ended September 30, 2017 was $1.3 million, a $1.4 million increase from the $83 thousand release from the allowance for loan and lease losses (the “Allowance”) for the second quarter of 2017. The increase in the Provision was driven by loan growth as well as changes to certain qualitative factors used to estimate the incurred loan and lease losses in the loan portfolio as of September 30, 2017.
     
  • Income tax expense for the third quarter of 2017 decreased by $139 thousand as compared to the second quarter of 2017. The 347 basis point decrease in the effective tax rate from the second quarter of 2017 to the third quarter of 2017 was primarily the result of recognizing excess tax benefits associated with the vesting of restricted stock awards and the exercise of stock options. Excess tax benefits totaled $694 thousand for the third quarter of 2017 as compared to $113 thousand for the second quarter of 2017.

Results of Operations – Third Quarter 2017 Compared to Third Quarter 2016

  • Net income for the three months ended September 30, 2017 was $10.7 million, or $0.62 diluted earnings per share, as compared to $9.4 million, or diluted earnings per share of $0.55, for the same period in 2016. Contributing to the increase in net income was an increase of $2.7 million in net interest income and a $1.8 million increase in noninterest income, with wealth management, insurance and capital markets performance contributing to the increase. Partially offsetting these increases was a $2.8 million increase in noninterest expense, with increases in salaries and wages and due diligence and merger-related expenses being offset by decreases in Pennsylvania bank shares tax, amortization of intangible assets and professional fees.
     
  • Tax-equivalent net interest income for the three months ended September 30, 2017 was $29.6 million, an increase of $2.7 million, or 10.3%, from $26.9 million for the same period in 2016.  The accretion of purchase accounting adjustments increased the tax-equivalent net interest income recorded for the third quarter of 2017 by $753 thousand, as compared to an increase of $637 thousand for the same period in 2016.         

    Average loans and leases for the three months ended September 30, 2017 increased by $203.3 million from the same period in 2016 and experienced a ten basis point increase in tax-equivalent yield. The increase in the prime rate, which occurred toward the end of the second quarter, contributed to the increase in tax-equivalent yield on loans, as did the accretion of purchase accounting adjustments, which totaled $708 thousand for the third quarter of 2017 as compared to $578 thousand for the same period in 2017. Excluding the effect of the accretion of purchase accounting adjustments on loans and leases, the tax-equivalent yield on loans and leases increased by nine basis points. The net effect of the yield and volume increases on average loans and leases was a $3.0 million increase in tax-equivalent interest income on loans.

    Average available for sale investment securities increased by $85.2 million for the three months ended September 30, 2017 as compared to the same period in 2016, and experienced a 26 basis point tax-equivalent yield increase. The increase in volume and yield on available for sale investment securities resulted in a $682 thousand increase in tax-equivalent interest income for the third quarter of 2017 as compared to the same period in 2016.

    Partially offsetting the increase in average loans and leases and available for sale investment securities was a $141.8 million increase in average interest-bearing deposits accompanied by an eleven basis point increase in rate paid on deposits resulting in a $623 thousand increase in interest expense on deposits for the third quarter of 2017 as compared to the same period in 2016. In addition to the increase in average deposits, average borrowings increased $78.9 million for the three months ended September 30, 2017 as compared to the same period in 2016 with the rate paid remaining unchanged, which resulted in a $340 thousand increase in interest expense on borrowings.

  • The tax-equivalent net interest margin of 3.71% for the three months ended September 30, 2017 remained unchanged from the same period in 2016. The contribution to the tax-equivalent margin from the accretion of purchase accounting adjustments for both periods also remained unchanged at nine basis points.
     
  • Noninterest income for the three months ended September 30, 2017 increased by $1.8 million from the same period in 2016. An increase of $551 thousand in fees for wealth management services resulted as wealth assets under management, administration, supervision and brokerage increased $2.46 billion from September 30, 2016 to September 30, 2017. Insurance revenue increased $487 thousand for the third quarter of 2017 as compared to the same period in 2016, largely due to the May 2017 acquisition of Hirshorn Boothby. In addition, revenue from our Capital Markets initiative, which was launched in the second quarter of 2017, contributed $843 thousand to noninterest income.
     
  • Noninterest expense for the three months ended September 30, 2017 increased $2.8 million from the same period in 2016. The increase was largely related to a $2.0 million increase in salary and wages due to staffing increases from our Capital Markets initiative, the Hirshorn Boothby acquisition and the Princeton wealth management office, annual salary and wage increases and increases in incentive compensation. In addition, an $850 thousand increase in due diligence, merger-related and merger integration costs primarily related to the Royal Bank merger, and a $597 thousand increase in other operating expenses, which included a $368 thousand increase in contributions, largely comprised of contributions to local schools under the Pennsylvania Educational Improvement Tax Credit (EITC) program, contributed to the increase. Contributions made through the EITC program result in tax credits towards the Bank’s Pennsylvania bank shares tax obligation.
     
  • For the three months ended September 30, 2017, a Provision of $1.3 million was recorded as compared to $1.4 million for the same period in 2016. Net charge-offs for the third quarter of 2017 were $728 thousand as compared to $704 thousand for the same period in 2016.

Financial Condition – September 30, 2017 Compared to December 31, 2016

  • Total portfolio loans and leases of $2.68 billion as of September 30, 2017, increased by $141.9 million from December 31, 2016. Loan growth was concentrated in the commercial mortgage and commercial and industrial segments of the portfolio, which increased by $113.7 million, or 10.2%, and $17.8 million, or 3.1%, respectively.
     
  • The Allowance as of September 30, 2017 was $17.0 million, or 0.64% of portfolio loans as compared to $17.5 million, or 0.69% of portfolio loans and leases as of December 31, 2016. 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 0.70% as of September 30, 2017, as compared to 0.78% as of December 31, 2016, and the Allowance plus the remaining loan mark as a percentage of gross loans, which was 1.01% as of September 30, 2017, as compared to 1.17% as of December 31, 2016. A reconciliation of these and other non-GAAP to GAAP performance measures is included in the appendix to this earnings release. The change in the Allowance ratios was the result of the growth of the loan portfolio and improvements in certain qualitative factors and economic indicators, along with decreases in certain historic charge-off rates over the lookback period.
     
  • Available for sale investment securities as of September 30, 2017 totaled $471.7 million, a decrease of $95.3 million from December 31, 2016. The decrease in available for sale investment securities was primarily the result of the maturing, in January 2017, of $200 million of short-term U.S. Treasury bills. Partially offsetting the effect of this decrease in U.S. Treasury bills were increases of $104.7 million in available for sale investment securities since December 31, 2016, primarily in U.S. government and agency bonds and mortgage-backed securities. A portion of this increase is related to the strategic repositioning of the investment portfolio in anticipation of the Royal Bank merger.
     
  • Total assets as of September 30, 2017 were $3.48 billion, an increase of $55.3 million from December 31, 2016. Increases in portfolio loans and leases were largely offset by a decrease in available for sale investment securities discussed in the previous bullet point.
     
  • Wealth assets under management, administration, supervision and brokerage totaled $12.43 billion as of September 30, 2017, an increase of $1.10 billion from December 31, 2016. The increase in wealth assets was comprised of a $456.9 million increase in account balances whose fees are based on market value, and a $646.0 million increase in fixed rate flat-fee account types.
     
  • Deposits of $2.68 billion as of September 30, 2017 increased $104.5 million from December 31, 2016. Over 76% of this increase was in interest-bearing deposits, which grew by $80.1 million.
     
  • Borrowings of $315.5 million as of September 30, 2017 decreased $78.4 million from December 31, 2016. The decrease was comprised of a $23.3 million decrease in short-term borrowings and a $55.1 million decrease in long-term FHLB advances. In January 2017, $200.0 million of short-term borrowings associated with the maturing of $200.0 million of short-term U.S. Treasury bills were repaid.  The net increase in short-term borrowings of $176.7 million was utilized to support loan growth, purchases of available for sale investment securities and to replace $55.1 million of long-term FHLB advances which matured during the first nine months of 2017.

  • The capital ratios for the Bank and the Corporation, as of September 30, 2017, as shown in the attached tables, indicate levels above the regulatory minimum to be considered “well capitalized.”

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, our inability to obtain applicable regulatory approvals with respect to, or our inability to complete, the contemplated Royal Bank acquisition, that the integration of acquired businesses with the Corporation 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.

FOR MORE INFORMATION CONTACT:    

Frank Leto, President, CEO                               
610-581-4730
Mike Harrington, CFO
610-526-2466

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, 2017 June 30, 2017 March 31, 2017 December 31, 2016 September 30, 2016 September 30, 2017 September 30, 2016 
Consolidated Balance Sheet (selected items)              
Interest-bearing deposits with banks$  36,870  $  30,806  $  69,978  $  34,206  $  30,118      
Investment securities (AFS, HTM and Trading)   482,399     452,869     400,360     573,763     373,508      
Loans held for sale   6,327     8,590     3,015     9,621     11,506      
Portfolio loans and leases   2,677,345     2,666,651     2,555,589     2,535,425     2,493,357      
Allowance for loan and lease losses ("ALLL")   (17,004)    (16,399)    (17,107)    (17,486)    (17,744)     
Goodwill and other intangible assets   128,534     129,211     124,629     125,170     126,000      
Total assets   3,476,821     3,438,219     3,292,617     3,421,530     3,174,080      
Deposits - interest-bearing   1,923,567     1,863,288     1,865,009     1,843,495     1,759,862      
Deposits - non-interest-bearing   760,614     818,475     771,556     736,180     718,015      
Short-term borrowings   180,874     130,295     23,613     204,151     50,065      
Long-term FHLB advances and other borrowings   134,651     164,681     174,711     189,742     204,772      
Subordinated notes   29,573     29,559     29,546     29,532     29,518      
Total liabilities   3,074,929     3,043,242     2,904,522     3,040,403     2,795,621      
Shareholders' equity   401,892     394,977     388,095     381,127     378,459      
               
Average Balance Sheet (selected items)              
Interest-bearing deposits with banks$  26,628  $  26,266  $  39,669  $  55,298  $  33,532  $  30,807  $  39,157  
Investment securities (AFS, HTM and Trading)   462,700     429,400     393,306     386,658     373,616     428,723     368,594  
Loans held for sale   3,728     3,855     4,238     11,591     12,887     3,938     8,752  
Portfolio loans and leases   2,676,589     2,611,755     2,551,439     2,506,376     2,464,085     2,613,720     2,390,931  
Total interest-earning assets   3,169,645     3,071,276     2,988,652     2,959,923     2,884,120     3,077,188     2,807,434  
Goodwill and intangible assets   128,917     126,537     124,884     125,614     126,505     126,794     127,398  
Total assets   3,441,906     3,333,307     3,244,060     3,215,868     3,142,019     3,340,484     3,068,642  
Deposits - interest-bearing   1,871,494     1,853,660     1,852,194     1,809,276     1,729,689     1,859,188     1,693,663  
Short-term borrowings   182,845     98,869     47,603     40,629     40,966     110,268     35,836  
Long-term FHLB advances   155,918     171,567     182,507     198,454     218,920     169,900     235,002  
Subordinated notes   29,564     29,550     29,537     29,523     29,509     29,550     29,496  
Total interest-bearing liabilities   2,239,821     2,153,646     2,111,841     2,077,882     2,019,084     2,168,906     1,993,997  
Total liabilities   3,044,549     2,943,591     2,861,846     2,837,825     2,769,065     2,950,666     2,701,973  
Shareholders' equity   397,357     389,716     382,214     378,043     372,954     389,818     366,669  
               
Income Statement              
Net interest income$  29,438  $  27,965  $  27,403  $  26,990  $  26,717  $  84,806  $  79,246  
Provision for loan and lease losses   1,333     (83)    291     1,059     1,412     1,541     3,267  
Noninterest income   15,584     14,785     13,227     13,248     13,786     43,596     40,920  
Noninterest expense   28,184     28,495     26,660     25,087     25,371     83,339     76,787  
Income tax expense   4,766     4,905     4,635     4,684     4,346     14,306     13,484  
Net income   10,739     9,433     9,044     9,408     9,374     29,216     26,628  
Basic earnings per share   0.63     0.56     0.53     0.56     0.56     1.72     1.58  
Diluted earnings per share   0.62     0.55     0.53     0.55     0.55     1.70     1.57  
Net income (core) (1)   11,245     10,236     9,375     9,402     9,392     30,857     26,684  
Basic earnings per share (core) (1)   0.66     0.60     0.55     0.56     0.56     1.82     1.58  
Diluted earnings per share (core) (1)   0.65     0.59     0.55     0.55     0.55     1.79     1.57  
Cash dividends paid per share   0.22     0.21     0.21     0.21     0.21     0.64     0.61  
Profitability Indicators              
Return on average assets 1.24%  1.14%  1.13%  1.16%  1.19%  1.17%  1.16% 
Return on average equity 10.72%  9.71%  9.60%  9.90%  10.00%  10.02%  9.70% 
Return on tangible equity(1) 16.52%  15.06%  14.96%  15.68%  16.06%  23.42%  15.83% 
Tax-equivalent net interest margin 3.71%  3.68%  3.74%  3.65%  3.71%  3.71%  3.79% 
Efficiency ratio(1) 59.30%  62.16%  62.66%  60.30%  60.41%  61.32%  61.64% 
Mortgage Banking Information              
Mortgage loans originated$  48,159  $  46,848  $  48,550  $  78,749  $  84,885  $  143,557  $  201,310  
Residential mortgage loans sold - servicing retained   28,224     21,790     27,690     44,763     40,462     77,704     93,371  
Residential mortgage loans sold - servicing released   4,982     3,819     4,981     4,632     10,522     13,782     18,197  
  Total residential mortgage loans sold$  33,206  $  25,609  $  32,671  $  49,395  $  50,984  $  91,486  $  111,568  
Residential mortgage loans serviced for others$  647,037  $  641,165  $  638,553  $  631,889  $  618,134      
Share Data              
Closing share price$  43.80  $  42.50  $  39.50  $  42.15  $  31.99      
Book value per common share$  23.57  $  23.25  $  22.87  $  22.50  $  22.40      
Tangible book value per common share$  16.03  $  15.64  $  15.53  $  15.11  $  14.94      
Price / book value 185.82%  182.81%  172.71%  187.34%  142.80%     
Price / tangible book value 273.19%  271.69%  254.41%  278.96%  214.07%     
Weighted average diluted shares outstanding   17,233,548     17,232,767     17,182,689     17,164,675     17,072,358     17,222,051     16,994,455  
Shares outstanding, end of period 17,050,151   16,989,849   16,969,451   16,939,715   16,893,878      
Wealth Management Information:              
               
               
Wealth assets under mgmt, administration, supervision and brokerage (2)$  12,431,370  $  12,050,555  $  11,725,460  $  11,328,457  $  9,969,745      
Fees for wealth management services$  9,651  $  9,807  $  9,303  $  9,327  $  9,100      
                         
Capital Ratios              
Bryn Mawr Trust Company              
Tier I capital to risk weighted assets ("RWA") 10.78%  10.29%  10.58%  10.50%  10.99%     
Total (Tier II) capital to RWA 11.42%  10.90%  11.25%  11.19%  11.70%     
Tier I leverage ratio 8.75%  8.76%  8.83%  8.73%  9.17%     
Tangible equity ratio (1) 8.46%  8.24%  8.46%  7.85%  8.85%     
Common equity Tier I capital to RWA 10.78%  10.29%  10.58%  10.50%  10.99%     
               
Bryn Mawr Bank Corporation              
Tier I capital to RWA 10.50%  10.10%  10.50%  10.51%  10.42%     
Total (Tier II) capital to RWA 12.23%  11.79%  12.30%  12.35%  12.30%     
Tier I leverage ratio 8.53%  8.63%  8.77%  8.73%  8.70%     
Tangible equity ratio (1) 8.16%  8.03%  8.32%  7.76%  8.28%     
Common equity Tier I capital to RWA 10.50%  10.10%  10.50%  10.51%  10.42%     
               
Asset Quality Indicators              
               
Net loan and lease charge-offs ("NCO"s)$  728  $  625  $  670  $  1,317  $  704  $  2,023  $  1,380  
                             
Nonperforming loans and leases ("NPL"s)$  4,472  $  7,237  $  7,329  $  8,363  $  9,883      
Other real estate owned ("OREO")   865     1,122     978     1,017     867      
Total nonperforming assets ("NPA"s)$   5,337   $   8,359   $   8,307   $   9,380   $   10,750       
               
Nonperforming loans and leases 30 or more days past due$  2,337  $  4,076  $  5,097  $  6,072  $  6,684      
Performing loans and leases 30 to 89 days past due   4,558     6,258     6,077     3,062     2,537      
Performing loans and leases 90 or more days past due   -     -     -     -     -      
Total delinquent loans and leases$   6,895   $   10,334   $   11,174   $   9,134   $   9,221       
               
Delinquent loans and leases to total loans and leases 0.26%  0.39%  0.44%  0.36%  0.37%     
Delinquent performing loans and leases to total loans and leases 0.17%  0.23%  0.24%  0.12%  0.10%     
NCOs / average loans and leases (annualized) 0.11%  0.10%  0.11%  0.21%  0.11%  0.10%  0.08% 
NPLs / total portfolio loans and leases 0.17%  0.27%  0.29%  0.33%  0.40%     
NPAs / total loans and leases and OREO 0.20%  0.31%  0.32%  0.37%  0.43%     
NPAs / total assets 0.15%  0.24%  0.25%  0.27%  0.34%     
ALLL / NPLs 380.23%  226.60%  233.42%  209.09%  179.54%     
ALLL / portfolio loans 0.64%  0.61%  0.67%  0.69%  0.71%     
ALLL on originated loans and leases / Originated loans and leases (1) 0.70%  0.68%  0.75%  0.78%  0.81%     
(Total Allowance + Loan mark) / Total Gross portfolio loans and leases (1) 1.01%  1.03%  1.12%  1.17%  1.24%     
               
Troubled debt restructurings ("TDR"s) included in NPLs$  2,033  $  2,470  $  2,681  $  2,632  $  1,680      
TDRs in compliance with modified terms   6,597     6,148     6,492     6,395     6,305      
Total TDRs$   8,630   $   8,618   $   9,173   $   9,027   $   7,985       
               

(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, 2017 June 30, 2017 March 31, 2017 December 31, 2016 September 30, 2016   
Assets            
Cash and due from banks$  8,682  $  19,352  $  17,457  $  16,559  $  18,905    
Interest-bearing deposits with banks   36,870     30,806     69,978     34,206     30,118    
  Cash and cash equivalents   45,552     50,158     87,435     50,765     49,023    
Investment securities, available for sale   471,721     443,687     391,028     566,996     366,910    
Investment securities, held to maturity   6,255     5,161     5,194     2,879     2,896    
Investment securities, trading   4,423     4,021     4,138     3,888     3,702    
Loans held for sale   6,327     8,590     3,015     9,621     11,506    
Portfolio loans and leases, originated   2,433,054     2,409,964     2,286,814     2,240,987     2,176,549    
Portfolio loans and leases, acquired   244,291     256,687     268,775     294,438     316,808    
  Total portfolio loans and leases   2,677,345     2,666,651     2,555,589     2,535,425     2,493,357    
Less: Allowance for losses on originated loan and leases   (16,957)    (16,374)    (17,069)    (17,458)    (17,716)   
Less: Allowance for losses on acquired loan and leases   (47)    (25)    (38)    (28)    (28)   
  Total allowance for loan and lease losses   (17,004)    (16,399)    (17,107)    (17,486)    (17,744)   
  Net portfolio loans and leases   2,660,341     2,650,252     2,538,482     2,517,939     2,475,613    
Premises and equipment   44,544     44,446     40,515     41,778     42,559    
Accrued interest receivable   9,287     8,717     8,392     8,533     8,066    
Mortgage servicing rights   5,732     5,683     5,686     5,582     4,793    
Bank owned life insurance   39,881     39,680     39,479     39,279     39,055    
Federal Home Loan Bank ("FHLB") stock   16,248     15,168     8,505     17,305     13,185    
Goodwill   107,127     107,127     104,765     104,765     104,765    
Intangible assets   21,407     22,084     19,864     20,405     21,235    
Other investments   8,941     8,682     8,716     8,627     9,121    
Other assets   29,035     24,763     27,403     23,168     21,651    
  Total assets$  3,476,821  $  3,438,219  $  3,292,617  $  3,421,530  $  3,174,080    
                     
Liabilities            
Deposits            
  Noninterest-bearing$  760,614  $  818,475  $  771,556  $  736,180  $  718,015    
  Interest-bearing   1,923,567     1,863,288     1,865,009     1,843,495     1,759,862    
  Total deposits   2,684,181     2,681,763     2,636,565     2,579,675     2,477,877    
Short-term borrowings   180,874     130,295     23,613     204,151     50,065    
Long-term FHLB advances   134,651     164,681     174,711     189,742     204,772    
Subordinated notes   29,573     29,559     29,546     29,532     29,518    
Accrued interest payable   2,267     2,830     2,722     2,734     1,854    
Other liabilities   43,383     34,114     37,365     34,569     31,535    
  Total liabilities   3,074,929     3,043,242     2,904,522     3,040,403     2,795,621    
             
Shareholders' equity            
Common stock   21,248     21,162     21,141     21,111     21,064    
Paid-in capital in excess of par value   235,412     234,654     233,910     232,806     231,398    
Less: common stock held in treasury, at cost   (68,134)    (67,091)    (66,969)    (66,950)    (66,895)   
Accumulated other comprehensive (loss) income, net of tax   (1,400)    (1,564)    (1,990)    (2,409)    2,128    
Retained earnings   214,766     207,816     202,003     196,569     190,764    
  Total shareholders equity   401,892     394,977     388,095     381,127     378,459    
  Total liabilities and shareholders' equity$  3,476,821  $  3,438,219  $  3,292,617  $  3,421,530  $  3,174,080    
                       
                       

 

Bryn Mawr Bank Corporation             
Supplemental Balance Sheet Information (unaudited)             
(dollars in thousands)             
 Portfolio Loans and Leases as of    
 September 30, 2017 June 30, 2017 March 31, 2017 December 31, 2016 September 30, 2016    
Commercial mortgages$  1,224,571  $  1,197,936  $  1,137,870  $  1,110,897  $  1,089,621     
Home equity loans and lines   206,974     208,480     203,962     208,000     206,578     
Residential mortgages   422,524     416,488     418,264     413,540     418,408     
Construction   133,505     156,581     145,699     141,964     133,269     
  Total real estate loans   1,987,574     1,979,485     1,905,795     1,874,401     1,847,876     
Commercial & Industrial   597,595     599,203     567,917     579,791     565,497     
Consumer   31,306     28,485     23,932     25,341     23,717     
Leases   60,870     59,478     57,945     55,892     56,267     
  Total non-real estate loans and leases   689,771     687,166     649,794     661,024     645,481     
  Total portfolio loans and leases$  2,677,345  $  2,666,651  $  2,555,589  $  2,535,425  $  2,493,357     
                        
              
 Nonperforming Loans and Leases as of    
 September 30, 2017 June 30, 2017 March 31, 2017 December 31, 2016 September 30, 2016    
Commercial mortgages$  193  $  818  $  315  $  320  $  139     
Home equity loans and lines   613     1,535     1,828     2,289     2,827     
Residential mortgages   1,589     2,589     2,640     2,658     2,845     
Construction   -     -     -     -     -     
  Total nonperforming real estate loans   2,395     4,942     4,783     5,267     5,811     
Commercial & Industrial   1,977     2,112     2,471     2,957     3,960     
Consumer   -     10     -     2     2     
Leases   100     173     75     137     110     
  Total nonperforming non-real estate loans and leases   2,077     2,295     2,546     3,096     4,072     
  Total nonperforming portfolio loans and leases$  4,472  $  7,237  $  7,329  $  8,363  $  9,883     
                        
              
 Net Loan and Lease Charge-Offs (Recoveries) for the Three Months Ended    
 September 30, 2017 June 30, 2017 March 31, 2017 December 31, 2016 September 30, 2016    
Commercial mortgage$  (3) $  (3) $  (3) $  (51) $  (4)    
Home equity loans and lines   69     169     438     69     375     
Residential   3     43     27     28     2     
Construction   (1)    (1)    (1)    (1)    -     
  Total net charge-offs of real estate loans   68     208     461     45     373     
Commercial & Industrial   298     185     59     1,128     95     
Consumer   36     16     39     42     58     
Leases   326     216     111     102     178     
  Total net charge-offs of non-real estate loans and leases   660     417     209     1,272     331     
  Total net charge-offs$  728  $  625  $  670  $  1,317  $  704     
                        

 

Bryn Mawr Bank Corporation            
Supplemental Balance Sheet Information (unaudited)            
(dollars in thousands)            
 Investment Securities Available for Sale, at Fair Value   
 September 30, 2017 June 30, 2017 March 31, 2017 December 31, 2016 September 30, 2016   
U.S. Treasury securities $  100  $  100  $  100  $  200,097  $  101    
Obligations of the U.S. Government and agencies    142,711     126,468     100,476     82,198     76,598    
State & political subdivisions - tax-free   23,556     26,958     30,416     33,005     36,735    
State & political subdivisions - taxable   524     524     524     525     529    
Mortgage-backed securities   260,680     230,617     197,420     185,951     184,919    
Collateralized mortgage obligations   39,595     42,549     45,476     48,694     51,344    
Other debt securities   1,100     1,099     1,299     1,299     1,450    
Bond mutual funds   -     11,956     11,920     11,895     11,847    
Other investments   3,455     3,416     3,397     3,332     3,387    
  Total investment securities available for sale, at fair value$  471,721  $  443,687  $  391,028  $  566,996  $  366,910    
                       
             
 Unrealized Gain (Loss) on Investment Securities Available for Sale   
 September 30, 2017 June 30, 2017 March 31, 2017 December 31, 2016 September 30, 2016   
U.S. Treasury securities $  -  $  -  $  -  $  3  $  -    
Obligations of the U.S. Government and agencies    (920)    (699)    (803)    (913)    946    
State & political subdivisions - tax-free   23     11     (10)    (96)    131    
State & political subdivisions - taxable   1     1     1     2     5    
Mortgage-backed securities   869     480     196     (47)    3,801    
Collateralized mortgage obligations   (640)    (662)    (777)    (794)    253    
Other debt securities   -     (1)    (1)    (1)    -    
Bond mutual funds   -     -     (36)    (61)    (109)   
Other investments   230     203     132     13     34    
  Total unrealized (losses) gains on investment securities available for sale$  (437) $  (667) $  (1,298) $  (1,894) $  5,061    
                       
             
 Deposits   
 September 30, 2017 June 30, 2017 March 31, 2017 December 31, 2016 September 30, 2016   
Interest-bearing deposits:            
  Interest-bearing checking$  395,383  $  381,345  $  395,131  $  379,424  $  333,055    
  Money market   720,613     729,859     757,071     761,657     725,116    
  Savings   264,273     254,903     255,791     232,193     228,391    
  Wholesale non-maturity deposits   48,620     54,675     69,471     74,272     64,664    
  Wholesale time deposits   178,610     120,524     68,164     73,037     99,052    
  Retail time deposits    316,068     321,982     319,381     322,912     309,584    
  Total interest-bearing deposits   1,923,567     1,863,288     1,865,009     1,843,495     1,759,862    
  Noninterest-bearing deposits   760,614     818,475     771,556     736,180     718,015    
  Total deposits$  2,684,181  $  2,681,763  $  2,636,565  $  2,579,675  $  2,477,877    
                       

 

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, 2017 June 30, 2017 March 31, 2017 December 31, 2016 September 30, 2016 September 30, 2017 September 30, 2016 
Interest income:              
Interest and fees on loans and leases$  30,892  $  29,143  $  28,482  $  28,230  $  27,931  $  88,517  $  82,306  
Interest on cash and cash equivalents   36     35     66     53     27     137     115  
Interest on investment securities   2,270     2,059     1,778     1,639     1,556     6,107     4,648  
  Total interest income   33,198     31,237     30,326     29,922     29,514     94,761     87,069  
Interest expense:                            
Interest on deposits   2,198     1,983     1,828     1,780     1,575     6,009     4,053  
Interest on short-term borrowings   547     237     27     22     34     811     71  
Interest on FHLB advances and other borrowings   645     682     698     760     818     2,025     2,593  
Interest on subordinated notes   370     370     370     370     370     1,110     1,106  
Total interest expense   3,760     3,272     2,923     2,932     2,797     9,955     7,823  
  Net interest income   29,438     27,965     27,403     26,990     26,717     84,806     79,246  
Provision for loan and lease losses (the "Provision")   1,333     (83)    291     1,059     1,412     1,541     3,267  
  Net interest income after Provision   28,105     28,048     27,112     25,931     25,305     83,265     75,979  
Noninterest income:              
Fees for wealth management services    9,651     9,807     9,303     9,327     9,100     28,761     27,363  
Insurance revenue   1,373     943     763     715     886     3,079     3,007  
Capital markets revenue   843     953     -     -     -     1,796     -  
Service charges on deposits   676     630     647     688     688     1,953     2,103  
Loan servicing and other fees   548     519     503     411     497     1,570     1,528  
Net gain on sale of loans   799     520     629     607     879     1,948     2,440  
Net gain (loss) on sale of investment securities available for sale   72     -     1     9     (28)    73     (86) 
Net (loss) gain on sale of other real estate owned   -     (12)    -     -     -     (12)    (76) 
Dividends on FHLB and FRB stocks   217     218     214     309     277     649     754  
Other operating income   1,405     1,207     1,167     1,182     1,487     3,779     3,686  
  Total noninterest income   15,584     14,785     13,227     13,248     13,786     43,596     40,719  
Noninterest expense:              
Salaries and wages    13,602     13,580     12,450     11,855     11,621     39,632     35,556  
Employee benefits    2,631     2,475     2,559     2,207     2,420     7,665     7,341  
Loss on pension termination   -     -     -     -     -     -     -  
Occupancy and bank premises   2,485     2,247     2,526     2,407     2,349     7,258     7,204  
Branch lease termination expense   -     -     -     -     -     -     -  
Furniture, fixtures and equipment   1,726     1,869     1,974     1,869     1,837     5,569     5,651  
Advertising   277     405     386     391     334     1,068     990  
Amortization of intangible assets   677     687     693     830     888     2,057     2,668  
Impairment of intangible assets   -     -     -     -     -     -     -  
Impairment (recovery) of mortgage servicing rights ("MSRs")   3     43     3     (580)    29     49     711  
Due diligence, merger-related and merger integration expenses   850     1,236     511     -     -     2,597     -  
Professional fees   739     1,049     711     963     937     2,499     2,696  
Pennsylvania bank shares tax   317     297     664     (204)    675     1,278     1,953  
Information technology   880     821     874     857     881     2,575     2,804  
Other operating expenses    3,997     3,786     3,309     4,492     3,400     11,092     9,012  
  Total noninterest expense   28,184     28,495     26,660     25,087     25,371     83,339     76,586  
Income before income taxes   15,505     14,338     13,679     14,092     13,720     43,522     40,112  
Income tax expense   4,766     4,905     4,635     4,684     4,346     14,306     13,484  
  Net income$  10,739  $  9,433  $  9,044  $  9,408  $  9,374  $  29,216  $  26,628  
Per share data:                            
Weighted average shares outstanding   17,023,046     16,984,563     16,954,132     16,916,705     16,860,727     16,987,499     16,840,457  
Dilutive common shares   210,502     248,204     228,557     247,970     211,631     234,552     153,998  
Weighted average diluted shares    17,233,548     17,232,767     17,182,689     17,164,675     17,072,358     17,222,051     16,994,455  
Basic earnings (loss) per common share$  0.63  $  0.56  $  0.53  $  0.56  $  0.56  $  1.72  $  1.58  
Diluted earnings (loss) per common share$  0.62  $  0.55  $  0.53  $  0.55  $  0.55  $  1.70  $  1.57  
Dividend declared per share$  0.22  $  0.21  $  0.21  $  0.21  $  0.21  $  0.64  $  0.61  
Effective tax rate 30.74%  34.21%  33.88%  33.24%  31.68%  32.87%  33.62% 
               
               

 

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, 2017June 30, 2017March 31, 2017December 31, 2016September 30, 2016 September 30, 2017September 30, 2016
(dollars in thousands) Average BalanceInterest Income/ ExpenseAverage Rates Earned/ PaidAverage BalanceInterest Income/ ExpenseAverage Rates Earned/ PaidAverage BalanceInterest Income/ ExpenseAverage Rates Earned/ PaidAverage BalanceInterest Income/ ExpenseAverage Rates Earned/ PaidAverage BalanceInterest Income/ ExpenseAverage Rates Earned/ Paid Average BalanceInterest Income/ ExpenseAverage Rates Earned/ PaidAverage BalanceInterest Income/ ExpenseAverage Rates Earned/ Paid
                        
Assets:                       
Interest-bearing deposits with other banks $  26,628 $  36 0.54%$  26,266 $  35 0.53%$  39,669 $  66 0.67%$  55,298 $  53 0.38%$  33,532 $  27 0.32% $  30,807 $  137 0.59%$  39,157 $  115 0.39%
Investment securities - available for sale:                       
  Taxable    427,106    2,160 2.01%   391,112    1,940 1.99%   354,229    1,653 1.89%   344,931    1,498 1.73%   329,293    1,423 1.72%    391,082    5,799 1.98%   323,866    4,263 1.76%
  Tax-exempt    25,268    134 2.10%   28,970    150 2.08%   31,485    164 2.11%   34,985    175 1.99%   37,893    189 1.98%    28,552    448 2.10%   39,243    567 1.93%
  Total investment securities - available for sale     452,374    2,294 2.01%   420,082    2,090 2.00%   385,714    1,817 1.91%   379,916    1,673 1.75%   367,186    1,612 1.75%    419,634    6,247 1.99%   363,109    4,830 1.78%
                        
Investment securities  - held to maturity    6,044    11 0.72%   5,181    5 0.39%   3,702    7 0.77%   2,889    7 0.96%   2,907    6 0.82%    4,984    4 0.11%   1,782    4 0.30%
Investment securities  - trading    4,282    8 0.74%   4,137    13 1.26%   3,890    8 0.83%   3,853    16 1.65%   3,523    2 0.23%    4,105    2 0.07%   3,703    2 0.07%
                        
Loans and leases *    2,680,317    31,058 4.60%   2,615,610    29,309 4.49%   2,555,677    28,622 4.54%   2,517,967    28,354 4.48%   2,476,972    28,032 4.50%    2,617,658    88,989 4.55%   2,399,683    82,571 4.60%
                        
  Total interest-earning assets     3,169,645    33,407 4.18%   3,071,276    31,452 4.11%   2,988,652    30,520 4.14%   2,959,923    30,103 4.05%   2,884,120    29,679 4.09%    3,077,188    95,379 4.14%   2,807,434    87,522 4.16%
                        
Cash and due from banks    15,709      15,727      14,942      16,127      16,228       15,462      16,380   
Less: allowance for loan and lease losses    (16,564)     (17,549)     (17,580)     (17,858)     (17,257)      (17,227)     (16,924)  
Other assets     273,116      263,853      258,046      257,676      258,928       265,061      261,752   
                        
  Total assets $  3,441,906   $  3,333,307   $  3,244,060   $  3,215,868   $  3,142,019    $  3,340,484   $  3,068,642   
                        
Liabilities:                       
                        
Interest-bearing deposits:                       
  Savings, NOW and market rate deposits $  1,359,293 $  823 0.24%$  1,375,949 $  813 0.24%$  1,388,561 $  756 0.22%$  1,328,577 $  686 0.21%$  1,286,404 $  641 0.20% $  1,374,494 $  2,392 0.23%$  1,280,023 $  1,799 0.19%
  Wholesale deposits    190,849    548 1.14%   154,424    378 0.98%   143,461    317 0.90%   156,541    319 0.81%   164,706    327 0.79%    163,086    1,243 1.02%   166,136    921 0.74%
  Retail time deposits     321,352    827 1.02%   323,287    792 0.98%   320,172    755 0.96%   324,158    775 0.95%   278,579    607 0.87%    321,608    2,374 0.99%   247,504    1,333 0.72%
  Total interest-bearing deposits    1,871,494    2,198 0.47%   1,853,660    1,983 0.43%   1,852,194    1,828 0.40%   1,809,276    1,780 0.39%   1,729,689    1,575 0.36%    1,859,188    6,009 0.43%   1,693,663    4,053 0.32%
                        
Borrowings:                       
Short-term borrowings    182,845    547 1.19%   98,869    237 0.96%   47,603    27 0.23%   40,629    22 0.22%   40,966    34 0.33%    110,268    811 0.98%   35,836    71 0.26%
Long-term FHLB advances    155,918    645 1.64%   171,567    682 1.59%   182,507    698 1.55%   198,454    760 1.52%   218,920    818 1.49%    169,900    2,025 1.59%   235,002    2,593 1.47%
Subordinated notes    29,564    370 4.97%   29,550    370 5.02%   29,537    370 5.08%   29,523    370 4.99%   29,509    370 4.99%    29,550    1,110 5.02%   29,496    1,106 5.01%
  Total borrowings    368,327    1,562 1.68%   299,986    1,289 1.72%   259,647    1,095 1.71%   268,606    1,152 1.71%   289,395    1,222 1.68%    309,718    3,946 1.70%   300,334    3,770 1.68%
                        
  Total interest-bearing liabilities    2,239,821    3,760 0.67%   2,153,646    3,272 0.61%   2,111,841    2,923 0.56%   2,077,882    2,932 0.56%   2,019,084    2,797 0.55%    2,168,906    9,955 0.61%   1,993,997    7,823 0.52%
                        
Noninterest-bearing deposits    764,562      755,597      711,794      724,465      716,581       744,178      674,601   
Other liabilities    40,166      34,348      38,211      35,478      33,400       37,582      33,375   
  Total noninterest-bearing liabilities    804,728      789,945      750,005      759,943      749,981       781,760      707,976   
                        
  Total liabilities    3,044,549      2,943,591      2,861,846      2,837,825      2,769,065       2,950,666      2,701,973   
                        
Shareholders' equity     397,357      389,716      382,214      378,043      372,954       389,818      366,669   
                        
  Total liabilities and shareholders' equity  $  3,441,906   $  3,333,307   $  3,244,060   $  3,215,868   $  3,142,019    $  3,340,484   $  3,068,642   
                        
                        
Net interest spread   3.51%  3.50%  3.58%  3.49%  3.54%   3.53%  3.64%
Effect of noninterest-bearing sources     0.20%    0.18%    0.16%    0.16%    0.17%     0.18%    0.15%
                                      
Tax-equivalent net interest margin   $  29,647 3.71% $  28,180 3.68% $  27,597 3.74% $  27,171 3.65% $  26,882 3.71%  $  85,424 3.71% $  79,699 3.79%
                        
Tax-equivalent adjustment   $   209  0.03% $   215  0.03% $   194  0.02% $   181  0.02% $   165  0.02%  $   618  0.03% $   453  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  $  708 0.10% $  402 0.06% $  726 0.12% $  742 0.12% $  578 0.09%  $  1,836 0.09% $  2,607 0.15%
Retail time deposits     (15)-0.02%    (18)-0.02%    (19)-0.02%    (19)-0.02%    (29)-0.04%     (52)-0.02%    (200)-0.11%
Short-term borrowings     - 0.00%    - 0.00%    - 0.00%    - 0.00%    - 0.00%     - 0.00%    (12)-0.04%
Long-term FHLB advances and other borrowings     (30)-0.08%    (30)-0.07%    (30)-0.07%    (30)-0.06%    (30)-0.05%     (91)-0.07%    (90)-0.05%
Net interest income from fair value marks  $  753   $  450   $  775   $  791   $  637    $  1,979   $  2,909  
Purchase accounting effect on tax-equivalent margin    0.09%    0.06%    0.11%    0.11%    0.09%     0.09%    0.14%
* 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, 2017 June 30, 2017 March 31, 2017 December 31, 2016 September 30, 2016 September 30, 2017 September 30, 2016 
Reconciliation of Net Income to Net Income (core):              
Net income (a GAAP measure)$  10,739  $  9,433  $  9,044  $  9,408  $  9,374  $  29,216  $  26,628  
Less: Tax-effected non-core noninterest income:              
  Loss (gain) on sale of investment securities available for sale   (47)    -     (1)    (6)    18     (47)    56  
Add: Tax-effected non-core noninterest expense items:              
  Loss on pension termination   -     -     -     -     -     -     -  
  Severance expense (Salaries and wages)   -     -     -     -     -     -     -  
  Branch lease termination expense   -     -     -     -     -     -     -  
  Debt and swap prepayment penalty (Other operating expenses)   -     -     -     -     -     -     -  
  Impairment of intangible assets   -     -     -     -     -     -     -  
  Due diligence, merger-related and merger integration  expenses   553     803     332     -     -     1,688     -  
Net income (core) (a non-GAAP measure)$   11,245   $   10,236   $   9,375   $   9,402   $   9,392   $   30,857   $   26,684   
                             
Calculation of Basic and Diluted Earnings per Common Share (core):             
Weighted average common shares outstanding   17,023,046     16,984,563     16,954,132     16,916,705     16,860,727     16,987,499     16,840,457  
Dilutive common shares   210,502     248,204     228,557     247,970     211,631     234,552     153,998  
Weighted average diluted shares    17,233,548     17,232,767     17,182,689     17,164,675     17,072,358     17,222,051     16,994,455  
Basic earnings per common share (core) (a non-GAAP measure)$  0.66  $  0.60  $  0.55  $  0.56  $  0.56  $  1.82  $  1.58  
Diluted earnings per common share (core) (a non-GAAP measure)$  0.65  $  0.59  $  0.55  $  0.55  $  0.55  $  1.79  $  1.57  
               
Calculation of Return on Average Tangible Equity:              
Net income (loss)$  10,739  $  9,433  $  9,044  $  9,408  $  9,374  $  29,216  $  26,628  
Add: Tax-effected amortization and impairment of intangible assets   440     447     450     540     577     1,337     1,734  
Net tangible income (numerator)$  11,179  $  9,880  $  9,494  $  9,948  $  9,951  $  30,553  $  28,362  
               
Average shareholders' equity$  397,357  $  389,716  $  382,214  $  378,043  $  372,954  $  389,818  $  366,669  
Less: Average goodwill and intangible assets   (128,917)    (126,537)    (124,884)    (125,614)    (126,505)    (126,794)    (127,398) 
Net average tangible equity (denominator)$  268,440  $  263,179  $  257,330  $  252,429  $  246,449  $  263,024  $  239,271  
               
Return on tangible equity (a non-GAAP measure) 16.52%  15.06%  14.96%  15.68%  16.06%  15.53%  15.83% 
               
Calculation of Tangible Equity Ratio:              
Total shareholders' equity$  401,892  $  394,977  $  388,095  $  381,127  $  378,459      
Less: Goodwill and intangible assets   (128,534)    (129,211)    (124,629)    (125,170)    (126,000)     
Net tangible equity (numerator)$  273,358  $  265,766  $  263,466  $  255,957  $  252,459      
               
Total assets$  3,476,821  $  3,438,219  $  3,292,617  $  3,421,530  $  3,174,080      
Less: Goodwill and intangible assets   (128,534)    (129,211)    (124,629)    (125,170)    (126,000)     
Tangible assets (denominator)$  3,348,287  $  3,309,008  $  3,167,988  $  3,296,360  $  3,048,080      
               
Tangible equity ratio 8.16%  8.03%  8.32%  7.76%  8.28%     
               
Calculation of Efficiency Ratio:              
Noninterest expense$  28,184  $  28,495  $  26,660  $  25,087  $  25,371  $  83,339  $  76,787  
Less: certain noninterest expense items*:              
  Loss on pension termination   -     -     -     -     -     -     -  
  Severance expense (Salaries and wages)   -     -     -     -     -     -     -  
  Branch lease termination expense   -     -     -     -     -     -     -  
  Debt and swap prepayment penalty (Other operating expenses)   -     -     -     -     -     -     -  
  Amortization of intangibles   (677)    (687)    (693)    (830)    (888)    (2,057)    (2,668) 
  Impairment of intangible assets   -     -     -     -     -     -     -  
  Due diligence, merger-related and merger integration  expenses   (850)    (1,236)    (511)    -     -     (2,597)    -  
Noninterest expense (adjusted) (numerator)$  26,657  $  26,572  $  25,456  $  24,257  $  24,483  $  78,685  $  74,119  
               
Noninterest income$  15,584  $  14,785  $  13,227  $  13,248  $  13,786  $  43,596  $  40,920  
Less: non-core noninterest income items:              
  Loss (gain) on sale of investment securities available for sale   (72)    -     (2)    (9)    28     (73)    86  
Noninterest income (core)$  15,512  $  14,785  $  13,225  $  13,239  $  13,814  $  43,523  $  41,006  
Net interest income   29,438     27,965     27,403     26,990     26,717     84,806     79,246  
Noninterest income (core) and net interest income (denominator)$  44,950  $  42,750  $  40,628  $  40,229  $  40,531  $  128,329  $  120,252  
               
Efficiency ratio 59.30%  62.16%  62.66%  60.30%  60.41%  61.32%  61.64% 
* 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$  17,004  $  16,399  $  17,107  $  17,486  $  17,744      
Less: Allowance on acquired loans   47     25     38     28     28      
Allowance on originated loans and leases$  16,957  $  16,374  $  17,069  $  17,458  $  17,716      
               
Total Allowance$  17,004  $  16,399  $  17,107  $  17,486  $  17,744      
Loan mark on acquired loans   10,223     11,084     11,544