BRYN MAWR, Pa., July 18, 2019 (GLOBE NEWSWIRE) -- Bryn Mawr Bank Corporation (NASDAQ: BMTC) (the “Corporation”), parent of The Bryn Mawr Trust Company (the “Bank”), today reported net income of $15.8 million, or $0.78 diluted earnings per share for the three months ended June 30, 2019, as compared to net income of $10.7 million, or $0.53 diluted earnings per share, for the three months ended March 31, 2019, and $14.7 million, or $0.72 diluted earnings per share, for the three months ended June 30, 2018.

On a non-GAAP basis, core net income, which excludes income tax charges incurred in connection with the Tax Cuts and Jobs Act ("Tax Reform"), due diligence and merger-related expenses, one-time costs associated with our voluntary Years of Service Incentive Program (the “Incentive Program”), and other non-core income and expense items, as detailed in the appendix to this earnings release, was $15.8 million, or $0.78 diluted earnings per share, for the three months ended June 30, 2019, as compared to $14.2 million, or $0.70 diluted earnings per share, for the three months ended March 31, 2019, and $17.0 million, or $0.83 diluted earnings per share, for the three months ended June 30, 2018. 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.

"We continue to execute on our strategy as reflected in our second quarter results,” commented Frank Leto, President and Chief Executive Officer, continuing, “Despite the challenges of a flat yield curve and an increasingly competitive market for loans and deposits, we continue to produce solid results in both the Bank and Wealth businesses without compromising on the execution of longer term vision as demonstrated by our ongoing investments in talent and technology.”

Mr. Leto then continued, “I am also pleased to announce that the Board of Directors has approved a dividend increase of 4%, making this the ninth consecutive year the Corporation has raised its dividend.”

The Board of Directors of the Corporation declared a quarterly dividend of $0.26 per share, payable September 1, 2019 to shareholders of record as of August 1, 2019.

SIGNIFICANT ITEMS OF NOTE

Results of Operations – Second Quarter 2019 Compared to First Quarter 2019

  • Net income for the three months ended June 30, 2019 was $15.8 million, compared to net income of $10.7 million for the three months ended March 31, 2019. Net interest income for the three months ended June 30, 2019 was $36.6 million, a decrease of $1.0 million over the linked quarter. The provision for loan and lease losses (the “Provision”) for the three months ended June 30, 2019 decreased $2.1 million as compared to the first quarter of 2019. Total noninterest income increased $968 thousand, total noninterest expense decreased $4.5 million, and income tax expense increased $1.5 million for the three months ended June 30, 2019, as compared to the three months ended March 31, 2019.

    On a non-GAAP basis, core net income, which excludes income tax charges incurred in connection with Tax Reform, due diligence and merger-related expenses, one-time costs associated with the Incentive Program, and other non-core income and expense items, as detailed in the appendix to this earnings release, was $15.8 million, or $0.78 per diluted share, for the three months ended June 30, 2019, as compared to $14.2 million or $0.70 per diluted share, for the three months ended March 31, 2019. 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.

  • Net interest income for the three months ended June 30, 2019 was $36.6 million, a decrease of $1.0 million over the linked quarter. Tax-equivalent net interest income for the three months ended June 30, 2019 was $36.7 million, a decrease of $1.0 million over the linked quarter. Tax-equivalent net interest income for the second quarter of 2019 was impacted by the accretion of purchase accounting fair value marks of $1.3 million as compared to $2.1 million for the linked quarter. Excluding the effects of these purchase accounting fair value marks, the adjusted tax-equivalent net interest income for the three months ended June 30, 2019 was $35.4 million, a decrease of $182 thousand over the linked quarter. A reconciliation of this and other non-GAAP to GAAP performance measures is included in the appendix to this earnings release. Items contributing to the decrease in tax-equivalent net interest income adjusted for purchase accounting included an increase of $1.5 million in interest paid on deposits, partially offset by an increase of $749 thousand in tax-equivalent interest and fees earned on loans and leases and a decrease of $586 thousand of interest expense on short-term borrowings for the three months ended June 30, 2019 as compared to the linked quarter ended March 31, 2019.

    Interest expense on deposits for the three months ended June 30, 2019 increased $1.6 million over the linked quarter. The increase was primarily due to a 16 basis point increase in the rate paid on deposits as compared to the linked quarter. The increase in rate paid was related to the competitive dynamics in the markets in which we operate and certain promotional interest rates offered during the first and second quarters of 2019. A $120.7 million increase in average interest-bearing deposits also contributed to the increase in interest expense on deposits.

    Tax-equivalent interest and fees earned on loans and leases for the three months ended June 30, 2019 was relatively unchanged as compared to the linked quarter, decreasing $55 thousand. Average loans and leases for the three months ended June 30, 2019 increased $46.5 million over the linked quarter and experienced a 13 basis point decrease in tax-equivalent yield.

    Tax-equivalent interest income on available for sale investment securities for the three months ended June 30, 2019 was relatively unchanged as compared to the linked quarter, increasing $25 thousand. Average available for sale investment securities increased by $15.0 million over the linked quarter and experienced a 7 basis point tax-equivalent yield decrease.

    Interest expense on short-term borrowings for the three months ended June 30, 2019 decreased $586 thousand over the linked quarter. Average short-term borrowings decreased $89.1 million coupled with a 34 basis point decrease in the rate paid as compared to the linked quarter.

  • The tax-equivalent net interest margin was 3.55% for the three months ended June 30, 2019 as compared to 3.75% for the linked quarter. Adjusting for the impact of the accretion of purchase accounting fair value marks, the adjusted tax-equivalent net interest margin was 3.43% for the three months ended June 30, 2019 as compared to 3.54% for the linked quarter. The main drivers for the decrease in the adjusted tax-equivalent net interest margin were the rate and volume increases of interest-bearing deposits as discussed above. A reconciliation of this and other non-GAAP to GAAP performance measures is included in the appendix to this earnings release.

  • Noninterest income of $20.2 million for the three months ended June 30, 2019 increased $968 thousand as compared to the linked quarter. Contributing to the increase were increases of $1.1 million, $433 thousand, and $205 thousand in fees for wealth management services, net gain on sale of loans, and other operating income, respectively, partially offset by a decrease of $730 thousand in capital markets revenue.

  • Noninterest expense of $35.2 million for the three months ended June 30, 2019 decreased $4.5 million as compared to $39.7 million for the first quarter of 2019. The decrease on a linked quarter basis was primarily due to decreases of $3.9 million and $849 thousand in salaries and wages and employee benefits, respectively, largely driven by the $4.5 million one-time expense from the Incentive Program recorded in the first quarter of 2019.

  • The Provision decreased $2.1 million for the three months ended June 30, 2019 to $1.6 million, as compared to $3.7 million for the first quarter of 2019. During the second quarter of 2019, net loan and lease charge-offs of $1.1 million represented a $1.5 million, or 58.3%, decrease from the first quarter of 2019. Contributing to net charge-offs for the second quarter of 2019 was $554 thousand in charge-offs recorded in conjunction with the sale of a group of nonperforming loans. The decrease in net charge-offs on a linked quarter basis was primarily related to the partial charge-off of a single commercial credit recorded in the first quarter of 2019. The effect of the decrease in net charge-offs on a linked quarter basis was partially offset by increases in certain qualitative factors used in the allowance for loan and lease losses (the "Allowance") calculation.

  • The effective tax rate for the second quarter of 2019 increased to 21.18% as compared to 20.57% for the first quarter of 2019. The increase was primarily related to a $97 thousand decrease in net discrete tax benefits for the second quarter of 2019 as compared to the first quarter of 2019. These discrete items were the result of excess tax benefits from stock-based compensation.

Results of Operations – Second Quarter 2019 Compared to Second Quarter 2018

  • Net income for the three months ended June 30, 2019 was $15.8 million, or $0.78 diluted earnings per share, as compared to net income of $14.7 million, or diluted earnings per share of $0.72 for the same period in 2018. Net interest income for the three months ended June 30, 2019 was $36.6 million, a decrease of $705 thousand as compared to the same period in 2018. The Provision for the three months ended June 30, 2019 decreased $1.5 million as compared to the same period in 2018. Total noninterest income increased $146 thousand, total noninterest expense decreased $648 thousand, and income tax expense increased $516 thousand for the three months ended June 30, 2019 as compared to the same period in 2018.

    On a non-GAAP basis, core net income, which excludes income tax charges incurred in connection with Tax Reform, due diligence and merger-related expenses, one-time costs associated with the Incentive Program, and other non-core income and expense items, as detailed in the appendix to this earnings release, was $15.8 million, or $0.78 per diluted share, for the three months ended June 30, 2019 as compared to $17.0 million, or $0.83 per diluted share, for the same period in 2018. 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.
  • Net interest income for the three months ended June 30, 2019 was $36.6 million, a decrease of $705 thousand as compared to the same period in 2018. Tax-equivalent net interest income for the three months ended June 30, 2019 was $36.7 million, a decrease of $687 thousand as compared to the same period in 2018. Tax-equivalent net interest income for the second quarter of 2019 was impacted by the accretion of purchase accounting fair value marks of $1.3 million as compared to $2.2 million for the same period in 2018. Excluding the effects of these purchase accounting fair value marks, the adjusted tax-equivalent net interest income for the three months ended June 30, 2019 was $35.4 million, an increase of $244 thousand as compared to the same period in 2018. A reconciliation of this and other non-GAAP to GAAP performance measures is included in the appendix to this earnings release. Items contributing to the increase adjusted for purchase accounting included increases of $3.9 million and $507 thousand in tax-equivalent interest and fees earned on loans and leases and tax-equivalent interest earned on available for sale investment securities, respectively, as well as decreases of $628 thousand and $230 thousand in interest paid on short-term borrowings and long-term FHLB advances, respectively.  These increases to tax-equivalent net interest income were partially offset by a $5.0 million increase in interest paid on deposits for the three months ended June 30, 2019 as compared to the same period in 2018.

    Tax-equivalent interest and fees earned on loans and leases increased $3.1 million for the three months ended June 30, 2019 as compared to the same period in 2018. Average loans and leases for the second quarter of 2019 increased $170.9 million from the same period in 2018 and experienced an 11 basis point increase in tax-equivalent yield.

    Tax-equivalent interest income on available for sale investment securities increased $507 thousand for the three months ended June 30, 2019 as compared to the same period in 2018. Average available for sale investment securities increased by $35.3 million as compared to the same period in 2018 and experienced a 22 basis point tax-equivalent yield increase.

    Interest expense on short-term borrowings and long-term FHLB advances for the three months ended June 30, 2019 decreased $628 thousand and $221 thousand, respectively as compared to the same period in 2018. Average short-term borrowings and average long-term FHLB advances decreased $136.8 million and $49.6 million, respectively, offset by a 17 and 13 basis point increase in the rate paid on short-term borrowings and long-term FHLB advances, respectively, as compared to the same period in 2018.

    Interest expense on deposits for the three months ended June 30, 2019 increased $5.2 million as compared to the same period in 2018. The increase was primarily due to a 67 basis point increase in the rate paid on deposits as compared to the same period in 2018. The increase in rate paid was related to the competitive dynamics in the markets in which we operate and certain promotional interest rates offered during the first and second quarters of 2019. A $305.6 million increase in average interest-bearing deposits also contributed to the increase in interest expense on deposits.

  • The tax-equivalent net interest margin was 3.55% for the three months ended June 30, 2019 as compared to 3.81% for the same period in 2018. Adjusting for the impact of the accretion of purchase accounting fair value marks, the adjusted tax-equivalent net interest margin was 3.43% and 3.58% for three months ended June 30, 2019 and 2018, respectively. The main drivers for the decrease in the adjusted tax-equivalent net interest margin were the rate and volume increases of interest-bearing deposits as discussed above. A reconciliation of this and other non-GAAP to GAAP performance measures is included in the appendix to this earnings release.

  • Noninterest income of $20.2 million for the three months ended June 30, 2019 increased by $146 thousand as compared to the same period in 2018. Increases of $852 thousand and $224 thousand in fees for wealth management services and net gain on sale of loans, respectively, were partially offset by decreases of $616 thousand and $205 thousand of capital markets revenue and insurance commissions, respectively.

  • Noninterest expense of $35.2 million for the three months ended June 30, 2019 decreased $648 thousand as compared to the same period in 2018. Contributing to the decrease were decreases of $3.1 million and $448 thousand in due diligence, merger-related and merger integration expenses and other operating expenses, respectively. Partially offsetting these decreases were increases of $798 thousand, $499 thousand, $440 thousand, and $428 thousand in salaries and wages, furniture, fixtures and equipment expenses, employee benefits, and occupancy and bank premises expense, respectively.

  • The Provision decreased $1.5 million for the three months ended June 30, 2019 to $1.6 million, as compared to $3.1 million for the same period in 2018. The decrease in Provision was related to the smaller volume of loan and lease growth during the second quarter of 2019 as compared to the same period in 2018. Net loan and lease growth during the second quarter of 2019 totaled $11.2 million, as compared to $83.7 million for the same period in 2018. Net charge-offs of loans and leases decreased by $340 thousand for the second quarter of 2019 as compared to the same period in 2018.

  • The effective tax rate for the second quarter of 2019 increased to 21.18% as compared to 20.21% for the second quarter of 2018. The increase was primarily related to a $94 thousand decrease in net discrete tax benefits for the second quarter of 2019 as compared to the same period in 2018. These discrete items were the result of excess tax benefits from stock-based compensation as well as the re-measurement of deferred tax items related to Tax Reform.

Financial Condition – June 30, 2019 Compared to December 31, 2018

  • Total assets as of June 30, 2019 were $4.74 billion, an increase of $84.1 million from December 31, 2018. The increase was primarily due to a $107.5 million increase in portfolio loans and leases, a $61.3 million increase in other assets, and $43.1 million of operating lease right-of-use assets as of June 30, 2019 included on the balance sheet as a result of a recently adopted accounting pronouncement. The $61.3 million increase in other assets was primarily due to a $31.7 million increase in the fair value of interest rate swaps. Partially offsetting these increases was a decrease in available for sale investment securities of $149.3 million.

  • Available for sale investment securities as of June 30, 2019 totaled $588.1 million, a decrease of $149.3 million from December 31, 2018. The decrease was primarily related to the maturing of $200.0 million short-term U.S. Treasury securities in the first quarter of 2019, partially offset by a $59.1 million increase in mortgage-backed securities.

  • Total portfolio loans and leases of $3.53 billion as of June 30, 2019 increased by $107.5 million from December 31, 2018, an increase of 3.1%. Increases of $98.4 million, $18.3 million, $11.7 million, $8.6 million and $2.5 million in commercial mortgages, leases, residential mortgages, commercial and industrial loans and consumer loans, respectively, were offset by decreases of $28.5 million and $3.5 million in construction loans and home equity loans and lines, respectively.

  • The Allowance as of June 30, 2019 was $21.2 million, or 0.60% of portfolio loans and leases, as compared to $19.4 million, or 0.57% of portfolio loans and leases as of December 31, 2018. In addition to the ratio of Allowance to portfolio loans and leases, management also calculates two non-GAAP measures: the Allowance for originated loans and leases as a percentage of originated loans and leases, which was 0.68% as of June 30, 2019, as compared to 0.67% as of December 31, 2018, and the Allowance plus the remaining loan mark as a percentage of gross loans, which was 1.00% as of June 30, 2019, as compared to 1.08% as of December 31, 2018. A reconciliation of these and other non-GAAP to GAAP performance measures is included in the appendix to this earnings release.

  • Deposits of $3.63 billion as of June 30, 2019 increased $33.3 million from December 31, 2018. Increases of $104.0 million, $80.4 million, $45.0 million, $39.3 million, and $16.7 million in money market accounts, interest-bearing demand accounts, wholesale non-maturity deposits, noninterest bearing deposits, and savings accounts, respectively, were offset by decreases of $212.1 million and $40.0 million in in wholesale time deposits and retail time deposits, respectively.

  • Borrowings of $376.1 million as of June 30, 2019, which include short-term borrowings, long-term FHLB advances, subordinated notes and junior subordinated debentures, decreased $51.8 million from December 31, 2018, primarily due to a $44.5 million decrease in short-term borrowings.

  • Wealth assets under management, administration, supervision and brokerage totaled $14.82 billion as of June 30, 2019, an increase of $1.39 billion from December 31, 2018.

  • The capital ratios for the Bank and the Corporation, as of June 30, 2019, as shown in the attached tables, indicate regulatory capital levels in excess of the regulatory minimums and the levels necessary for the Bank 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 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; unanticipated regulatory or legal proceedings, outcomes of litigation or other contingencies; cybersecurity events; 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 Six Months Ended
 June 30,
2019
 March 31,
2019
 December 31,
2018
 September 30,
2018
 June 30,
2018
 June 30,
2019
 June 30,
2018
Consolidated Balance Sheet (selected items)             
Interest-bearing deposits with banks$49,643  $29,449  $34,357  $35,233  $39,924     
Investment securities606,844  578,629  753,628  545,320  547,088     
Loans held for sale6,333  2,884  1,749  4,111  4,204     
Portfolio loans and leases3,534,665  3,523,514  3,427,154  3,381,475  3,389,501     
Allowance for loan and lease losses ("ALLL")(21,182) (20,616) (19,426) (18,684) (19,398)    
Goodwill and other intangible assets205,050  206,006  207,467  208,165  208,139     
Total assets4,736,565  4,631,993  4,652,485  4,388,442  4,394,203     
Deposits - interest-bearing2,691,502  2,755,307  2,697,468  2,522,863  2,466,529     
Deposits - non-interest-bearing940,911  882,310  901,619  834,363  892,386     
Short-term borrowings207,828  124,214  252,367  226,498  227,059     
Long-term FHLB advances47,941  55,407  55,374  72,841  87,808     
Subordinated notes98,616  98,571  98,526  98,482  98,491     
Jr. subordinated debentures21,665  21,622  21,580  21,538  21,497     
Total liabilities4,146,410  4,056,886  4,087,781  3,837,017  3,851,700     
Total shareholders' equity590,155  575,107  564,704  551,425  542,503     
Average Balance Sheet (selected items)             
Interest-bearing deposits with banks37,843  32,742  38,957  37,467  37,215  35,306  37,627 
Investment securities587,518  569,915  554,265  546,998  549,249  578,765  542,398 
Loans held for sale3,353  1,214  2,005  4,932  4,413  2,289  3,635 
Portfolio loans and leases3,520,866  3,476,525  3,397,479  3,374,767  3,348,926  3,498,818  3,318,812 
Total interest-earning assets4,149,580  4,080,396  3,992,706  3,964,164  3,939,803  4,115,178  3,902,472 
Goodwill and intangible assets205,593  206,716  207,893  207,880  208,039  206,152  206,790 
Total assets4,651,625  4,545,129  4,413,000  4,376,148  4,344,541  4,598,672  4,295,637 
Deposits - interest-bearing2,794,854  2,674,194  2,602,412  2,493,213  2,489,296  2,734,857  2,464,618 
Short-term borrowings68,529  157,652  128,429  208,201  205,323  112,844  189,019 
Long-term FHLB advances52,397  55,385  67,363  81,460  102,023  53,883  112,911 
Subordinated notes98,587  98,542  98,497  98,457  98,463  98,564  98,447 
Jr. subordinated debentures21,637  21,595  21,553  21,511  21,470  21,616  21,450 
Total interest-bearing liabilities3,036,004  3,007,368  2,918,254  2,902,842  2,916,575  3,021,764  2,886,445 
Total liabilities4,070,160  3,973,043  3,856,694  3,828,241  3,810,640  4,021,870  3,769,498 
Total shareholders' equity581,465  572,086  556,306  547,907  533,901  576,802  526,139 

 

 As of or For the Three Months Ended For the Six Months Ended
 June 30,
2019
 March 31,
2019
 December 31,
2018
 September 30,
2018
 June 30,
2018
 June 30,
2019
 June 30,
2018
Income Statement             
Net interest income$36,611  $37,647  $37,987  $36,729  $37,316  $74,258  $74,755 
Provision for loan and lease losses1,627  3,736  2,362  664  3,137  5,363  4,167 
Noninterest income20,221  19,253  18,097  18,274  20,075  39,474  39,611 
Noninterest expense35,188  39,724  34,845  33,592  35,836  74,912  71,866 
Income tax expense4,239  2,764  1,746  4,066  3,723  7,003  8,353 
Net income15,778  10,676  17,131  16,681  14,695  26,454  29,980 
Net (loss) income attributable to noncontrolling interest(7) (1) (5) (1) 7  (8) 6 
Net income attributable to Bryn Mawr Bank Corporation15,785  10,677  17,136  16,682  14,688  26,462  29,974 
Basic earnings per share0.78  0.53  0.85  0.82  0.73  1.31  1.48 
Diluted earnings per share0.78  0.53  0.84  0.82  0.72  1.31  1.47 
Net income (core) (1)15,785  14,230  17,167  17,140  17,031  30,015  36,313 
Basic earnings per share (core) (1)0.78  0.71  0.85  0.85  0.84  1.49  1.80 
Diluted earnings per share (core) (1)0.78  0.70  0.84  0.84  0.83  1.48  1.78 
Dividends paid or accrued per share0.26  0.25  0.25  0.25  0.22  0.51  0.44 
Profitability Indicators             
Return on average assets1.36% 0.95% 1.54% 1.51% 1.36% 1.16% 1.41%
Return on average equity10.89% 7.57% 12.22% 12.08% 11.03% 9.25% 11.49%
Return on tangible equity(1)17.62% 12.65% 20.37% 20.25% 18.90% 15.18% 19.77%
Return on tangible equity (core)(1)17.62% 16.59% 20.40% 20.78% 21.78% 17.11% 23.76%
Return on average assets (core)(1)1.36% 1.27% 1.54% 1.55% 1.57% 1.32% 1.70%
Return on average equity (core)(1)10.89% 10.09% 12.24% 12.41% 12.79% 10.49% 13.92%
Tax-equivalent net interest margin3.55% 3.75% 3.79% 3.69% 3.81% 3.65% 3.87%
Efficiency ratio(1)60.23% 60.26% 60.35% 58.75% 55.57% 60.25% 54.85%
Share Data             
Closing share price$37.32  $36.13  $34.40  $46.90  $46.30     
Book value per common share$29.31  $28.52  $28.01  $27.18  $26.80     
Tangible book value per common share$19.16  $18.34  $17.75  $16.95  $16.55     
Price / book value127.33% 126.68% 122.81% 172.55% 172.76%    
Price / tangible book value194.78% 197.00% 193.80% 276.70% 279.74%    
Weighted average diluted shares outstanding20,244,409  20,271,661  20,321,283  20,438,376  20,413,578  20,256,469  20,427,792 
Shares outstanding, end of period20,131,854  20,167,729  20,163,816  20,291,416  20,242,893     
Wealth Management Information:             
Wealth assets under mgmt, administration, supervision and brokerage (2)$14,815,298  $14,736,512  $13,429,544  $13,913,265  $13,404,723     
Fees for wealth management services$11,510  $10,392  $11,017  $10,343  $10,658     

 

 As of or For the Three Months Ended For the Six Months Ended
 June 30,
2019
 March 31,
2019
 December 31,
2018
 September 30,
2018
 June 30,
2018
 June 30,
2019
 June 30,
2018
Capital Ratios(3)             
Bryn Mawr Trust Company ("BMTC")             
Tier I capital to risk weighted assets ("RWA")11.71% 11.30% 11.42% 11.55% 11.34%    
Total capital to RWA12.29% 11.87% 11.99% 12.10% 11.91%    
Tier I leverage ratio9.61% 9.48% 9.48% 9.47% 9.49%    
Tangible equity ratio (1)9.58% 9.34% 8.95% 9.29% 9.27%    
Common equity Tier I capital to RWA11.71% 11.30% 11.42% 11.55% 11.34%    
              
Bryn Mawr Bank Corporation ("BMBC")             
Tier I capital to RWA11.01% 10.72% 10.92% 10.90% 10.46%    
Total capital to RWA14.30% 14.00% 14.30% 14.33% 13.87%    
Tier I leverage ratio9.04% 8.99% 9.06% 8.94% 8.75%    
Tangible equity ratio (1)8.51% 8.35% 8.05% 8.23% 8.00%    
Common equity Tier I capital to RWA10.43% 10.14% 10.32% 10.29% 9.86%    
              
Asset Quality Indicators             
Net loan and lease charge-offs ("NCO"s)$1,061  $2,546  $1,620  $1,378  $1,401  $3,607  $3,578 
              
Nonperforming loans and leases ("NPL"s)$12,179  $19,283  $12,820  $8,990  $9,448     
Other real estate owned ("OREO")155  84  417  529  531     
Total nonperforming assets ("NPA"s)$12,334  $19,367  $13,237  $9,519  $9,979     
              
Nonperforming loans and leases 30 or more days past due$8,224  $8,489  $7,765  $4,906  $6,749     
Performing loans and leases 30 to 89 days past due9,466  6,432  5,464  9,145  10,378     
Performing loans and leases 90 or more days past due             
Total delinquent loans and leases$17,690  $14,921  $13,229  $14,051  $17,127     
              
Delinquent loans and leases to total loans and leases0.50% 0.42% 0.39% 0.42% 0.50%    
Delinquent performing loans and leases to total loans and leases0.27% 0.18% 0.16% 0.27% 0.31%    
NCOs / average loans and leases (annualized)0.12% 0.30% 0.19% 0.16% 0.17% 0.21% 0.22%
NPLs / total portfolio loans and leases0.34% 0.55% 0.37% 0.27% 0.28%    
NPAs / total loans and leases and OREO0.35% 0.55% 0.39% 0.28% 0.29%    
NPAs / total assets0.26% 0.42% 0.28% 0.22% 0.23%    
ALLL / NPLs173.92% 106.91% 151.53% 207.83% 205.31%    
ALLL / portfolio loans0.60% 0.59% 0.57% 0.55% 0.57%    
ALLL for originated loans and leases / Originated loans and leases (1)0.68% 0.68% 0.67% 0.68% 0.71%    
(Total ALLL + Loan mark) / Total Gross portfolio loans and leases (1)1.00% 1.03% 1.08% 1.28% 1.35%    
              
Troubled debt restructurings ("TDR"s) included in NPLs$4,190  $4,057  $1,217  $1,208  $1,044     
TDRs in compliance with modified terms5,141  5,149  9,745  4,316  4,117     
Total TDRs$9,331  $9,206  $10,962  $5,524  $5,161     
  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.
  3. Capital Ratios for the current quarter are to be considered preliminary until the Call Reports are filed.

Bryn Mawr Bank Corporation
Detailed Balance Sheets (unaudited)
(dollars in thousands)

 June 30,
2019
 March 31,
2019
 December 31,
2018
 September 30,
2018
 June 30,
2018
Assets         
Cash and due from banks$13,742  $13,656  $14,099  $10,121  $7,318 
Interest-bearing deposits with banks49,643  29,449  34,357  35,233  39,924 
Cash and cash equivalents63,385  43,105  48,456  45,354  47,242 
Investment securities, available for sale588,119  559,983  737,442  528,064  531,075 
Investment securities, held to maturity10,209  10,457  8,684  8,916  7,838 
Investment securities, trading8,516  8,189  7,502  8,340  8,175 
Loans held for sale6,333  2,884  1,749  4,111  4,204 
Portfolio loans and leases, originated3,088,849  3,032,270  2,885,251  2,752,160  2,700,815 
Portfolio loans and leases, acquired445,816  491,244  541,903  629,315  688,686 
Total portfolio loans and leases3,534,665  3,523,514  3,427,154  3,381,475  3,389,501 
Less: Allowance for losses on originated loan and leases(21,076) (20,519) (19,329) (18,612) (19,181)
Less: Allowance for losses on acquired loan and leases(106) (97) (97) (72) (217)
Total allowance for loan and lease losses(21,182) (20,616) (19,426) (18,684) (19,398)
Net portfolio loans and leases3,513,483  3,502,898  3,407,728  3,362,791  3,370,103 
Premises and equipment68,092  67,279  65,648  63,281  54,185 
Operating lease right-of-use assets43,116  43,985       
Accrued interest receivable13,312  13,123  12,585  13,232  13,115 
Mortgage servicing rights4,744  4,910  5,047  5,328  5,511 
Bank owned life insurance58,437  58,138  57,844  57,543  57,243 
Federal Home Loan Bank ("FHLB") stock14,677  10,526  14,530  14,678  16,678 
Goodwill184,012  184,012  184,012  183,864  183,162 
Intangible assets21,038  21,994  23,455  24,301  24,977 
Other investments16,517  16,526  16,526  16,529  16,774 
Other assets122,575  83,984  61,277  52,110  53,921 
Total assets$4,736,565  $4,631,993  $4,652,485  $4,388,442  $4,394,203 
          
Liabilities         
Deposits         
Noninterest-bearing$940,911  $882,310  $901,619  $834,363  $892,386 
Interest-bearing2,691,502  2,755,307  2,697,468  2,522,863  2,466,529 
Total deposits3,632,413  3,637,617  3,599,087  3,357,226  3,358,915 
Short-term borrowings207,828  124,214  252,367  226,498  227,059 
Long-term FHLB advances47,941  55,407  55,374  72,841  87,808 
Subordinated notes98,616  98,571  98,526  98,482  98,491 
Jr. subordinated debentures21,665  21,622  21,580  21,538  21,497 
Operating lease liabilities47,393  48,224       
Accrued interest payable8,244  8,674  6,652  7,193  5,230 
Other liabilities82,310  62,557  54,195  53,239  52,700 
Total liabilities4,146,410  4,056,886  4,087,781  3,837,017  3,851,700 
          
Shareholders' equity         
Common stock24,583  24,577  24,545  24,533  24,453 
Paid-in capital in excess of par value376,652  375,655  374,010  373,205  372,227 
Less: common stock held in treasury, at cost(78,583) (76,974) (75,883) (70,437) (68,943)
Accumulated other comprehensive income (loss), net of tax1,700  (3,278) (7,513) (13,402) (11,191)
Retained earnings266,496  255,813  250,230  238,204  226,634 
Total Bryn Mawr Bank Corporation shareholders' equity590,848  575,793  565,389  552,103  543,180 
Noncontrolling interest(693) (686) (685) (678) (677)
Total shareholders' equity590,155  575,107  564,704  551,425  542,503 
Total liabilities and shareholders' equity$4,736,565  $4,631,993  $4,652,485  $4,388,442  $4,394,203 

Bryn Mawr Bank Corporation
Supplemental Balance Sheet Information (unaudited)
(dollars in thousands)

 Portfolio Loans and Leases as of
 June 30,
2019
 March 31,
2019
 December 31,
2018
 September 30,
2018
 June 30,
2018
Commercial mortgages$1,755,798  $1,746,695  $1,657,436  $1,618,493  $1,613,721 
Home equity loans and lines203,852  204,791  207,351  207,806  206,429 
Residential mortgages506,093  502,379  494,355  467,402  449,060 
Construction152,554  159,761  181,078  178,493  190,874 
Total real estate loans2,618,297  2,613,626  2,540,220  2,472,194  2,460,084 
Commercial & Industrial704,167  705,701  695,584  722,999  745,306 
Consumer49,335  47,821  46,814  47,809  51,462 
Leases162,866  156,366  144,536  138,473  132,649 
Total non-real estate loans and leases916,368  909,888  886,934  909,281  929,417 
Total portfolio loans and leases$3,534,665  $3,523,514  $3,427,154  $3,381,475  $3,389,501 

 

 Nonperforming Loans and Leases as of
 June 30,
2019
 March 31,
2019
 December 31,
2018
 September 30,
2018
 June 30,
2018
Commercial mortgages$6,072  $5,558  $2,568  $735  $1,011 
Home equity loans and lines49  6,904  3,616  1,933  2,323 
Residential mortgages701  2,863  3,452  2,770  2,647 
Construction      291   
Total nonperforming real estate loans6,822  15,325  9,636  5,729  5,980 
Commercial & Industrial4,495  2,965  2,101  1,782  1,585 
Consumer60  80  108  117   
Leases802  913  975  1,362  1,882 
Total nonperforming non-real estate loans and leases5,357  3,958  3,184  3,261  3,468 
Total nonperforming portfolio loans and leases$12,179  $19,283  $12,820  $8,990  $9,448 

 

 Net Loan and Lease Charge-Offs (Recoveries) for the Three Months Ended
 June 30,
2019
 March 31,
2019
 December 31,
2018
 September 30,
2018
 June 30,
2018
Commercial mortgage$(3) $1,373  $249  $56  $13 
Home equity loans and lines180  46  107    199 
Residential339  329  304  (12) (1)
Construction(1) (1)     (1)
Total net charge-offs of real estate loans515  1,747  660  44  210 
Commercial & Industrial(18) 391  298  304  467 
Consumer119  94  147  71  41 
Leases445  314  515  959  683 
Total net charge-offs of non-real estate loans and leases546  799  960  1,334  1,191 
 Total net charge-offs$1,061  $2,546  $1,620  $1,378  $1,401 

 

 Investment Securities Available for Sale, at Fair Value
 June 30,
2019
 March 31,
2019
 December 31,
2018
 September 30,
2018
 June 30,
2018
U.S. Treasury securities$101  $100  $200,013  $100  $100 
Obligations of the U.S. Government and agencies192,799  186,746  195,855  190,453  183,256 
State & political subdivisions - tax-free6,700  8,468  11,162  15,629  17,254 
State & political subdivisions - taxable170  170  170  170  171 
Mortgage-backed securities348,975  322,913  289,890  284,421  292,563 
Collateralized mortgage obligations38,724  40,486  39,252  36,193  36,634 
Other debt securities650  1,100  1,100  1,098  1,097 
Total investment securities available for sale, at fair value$588,119  $559,983  $737,442  $528,064  $531,075 

 

 Unrealized Gain (Loss) on Investment Securities Available for Sale
 June 30,
2019
 March 31,
2019
 December 31,
2018
 September 30,
2018
 June 30,
2018
U.S. Treasury securities$1  $  $(13) $  $ 
Obligations of the U.S. Government and agencies275  (1,334) (2,749) (5,881) (4,594)
State & political subdivisions - tax-free8  (5) (39) (90) (57)
State & political subdivisions - taxable    (1) (1) (1)
Mortgage-backed securities3,364  (696) (4,186) (7,584) (6,141)
Collateralized mortgage obligations89  (510) (898) (1,618) (1,443)
Other debt securities      (2) (3)
Total unrealized gains (losses) on investment securities available for sale$3,737  $(2,545) $(7,886) $(15,176) $(12,239)

 

 Deposits
 June 30,
2019
 March 31,
2019
 December 31,
2018
 September 30,
2018
 June 30,
2018
Interest-bearing deposits:         
Interest-bearing demand$745,134  $664,683  $664,749  $578,243  $617,258 
Money market966,596  961,348  862,644  812,027  814,530 
Savings263,830  265,613  247,081  286,266  291,858 
Retail time deposits502,745  531,522  542,702  561,123  536,287 
Wholesale non-maturity deposits100,047  47,744  55,031  24,040  36,826 
Wholesale time deposits113,150  284,397  325,261  261,164  169,770 
Total interest-bearing deposits2,691,502  2,755,307  2,697,468  2,522,863  2,466,529 
Noninterest-bearing deposits940,911  882,310  901,619  834,363  892,386 
Total deposits$3,632,413  $3,637,617  $3,599,087  $3,357,226  $3,358,915 


Bryn Mawr Bank Corporation

Detailed Income Statements (unaudited)
(dollars in thousands, except per share data)

 For the Three Months Ended For the Six Months Ended
 June 30,
2019
 March 31,
2019
 December 31,
2018
 September 30,
2018
 June 30,
2018
 June 30,
2019
 June 30,
2018
Interest income:             
Interest and fees on loans and leases$44,783  $44,837  $44,157  $42,103  $41,689  $89,620  $82,378 
Interest on cash and cash equivalents73  132  83  64  64  205  117 
Interest on investment securities3,532  3,499  3,294  3,066  3,001  7,031  5,793 
Total interest income48,388  48,468  47,534  45,233  44,754  96,856  88,288 
Interest expense:             
Interest on deposits9,655  8,097  7,048  5,533  4,499  17,752  7,971 
Interest on short-term borrowings357  943  681  1,096  985  1,300  1,615 
Interest on FHLB advances269  278  331  394  490  547  1,052 
Interest on jr. subordinated debentures352  358  342  337  321  710  609 
Interest on subordinated notes1,144  1,145  1,145  1,144  1,143  2,289  2,286 
Total interest expense11,777  10,821  9,547  8,504  7,438  22,598  13,533 
Net interest income36,611  37,647  37,987  36,729  37,316  74,258  74,755 
Provision for loan and lease losses (the "Provision")1,627  3,736  2,362  664  3,137  5,363  4,167 
Net interest income after Provision34,984  33,911  35,625  36,065  34,179  68,895  70,588 
Noninterest income:             
Fees for wealth management services11,510  10,392  11,017  10,343  10,658  21,902  20,966 
Insurance commissions1,697  1,672  1,459  1,754  1,902  3,369  3,595 
Capital markets revenue1,489  2,219  1,367  710  2,105  3,708  2,771 
Service charges on deposits852  808  798  726  752  1,660  1,465 
Loan servicing and other fees553  609  539  559  475  1,162  1,161 
Net gain on sale of loans752  319  1,606  631  528  1,071  1,046 
Net gain on sale of investment securities available for sale            7 
Net (loss) gain on sale of other real estate owned  (24) 3  5  111  (24) 287 
Dividends on FHLB and FRB stocks316  411  305  375  510  727  941 
Other operating income3,052  2,847  1,003  3,171  3,034  5,899  7,372 
Total noninterest income20,221  19,253  18,097  18,274  20,075  39,474  39,611 
Noninterest expense:             
Salaries and wages17,038  20,901  17,921  16,528  16,240  37,939  32,222 
Employee benefits3,317  4,166  2,977  3,356  2,877  7,483  6,585 
Occupancy and bank premises3,125  3,252  3,135  2,717  2,697  6,377  5,747 
Furniture, fixtures and equipment2,568  2,389  2,370  2,070  2,069  4,957  3,967 
Advertising504  415  540  349  369  919  830 
Amortization of intangible assets956  938  997  891  889  1,894  1,768 
Impairment (recovery) of mortgage servicing rights ("MSRs")10  17  101  (23) (1) 27  (51)
Due diligence, merger-related and merger integration expenses      389  3,053    7,372 
Professional fees1,316  1,320  1,526  997  932  2,636  1,680 
Pennsylvania bank shares tax513  409  374  472  473  922  946 
Data processing1,303  1,320  1,340  1,155  1,252  2,623  2,447 
Other operating expenses4,538  4,597  3,564  4,691  4,986  9,135  8,353 
Total noninterest expense35,188  39,724  34,845  33,592  35,836  74,912  71,866 
Income before income taxes20,017  13,440  18,877  20,747  18,418  33,457  38,333 
Income tax expense4,239  2,764  1,746  4,066  3,723  7,003  8,353 
Net income$15,778  $10,676  $17,131  $16,681  $14,695  $26,454  $29,980 
Net (loss) income attributable to noncontrolling interest(7) (1) (5) (1) 7  (8) 6 
Net income attributable to Bryn Mawr Bank Corporation$15,785  $10,677  $17,136  $16,682  $14,688  $26,462  $29,974 
              
Per share data:             
Weighted average shares outstanding20,144,651  20,168,498  20,225,993  20,270,706  20,238,852  20,156,509  20,221,010 
Dilutive common shares99,758  103,163  95,290  167,670  174,726  99,960  206,782 
Weighted average diluted shares20,244,409  20,271,661  20,321,283  20,438,376  20,413,578  20,256,469  20,427,792 
Basic earnings per common share$0.78  $0.53  $0.85  $0.82  $0.73  $1.31  $1.48 
Diluted earnings per common share$0.78  $0.53  $0.84  $0.82  $0.72  $1.31  $1.47 
Dividends paid or accrued per share$0.26  $0.25  $0.25  $0.25  $0.22  $0.51  $0.44 
Effective tax rate21.18% 20.57% 9.25% 19.60% 20.21% 20.93% 21.79%

Bryn Mawr Bank Corporation
Tax-Equivalent Net Interest Margin (unaudited)
(dollars in thousands, except per share data)

 For the Three Months Ended For the Six Months Ended
 June 30, 2019March 31, 2019December 31, 2018September 30, 2018June 30, 2018 June 30, 2019June 30, 2018
(dollars in thousands)Average
Balance
 Interest
Income/
Expense
 Average Rates
Earned/ Paid
Average Balance Interest Income/ Expense Average Rates
Earned/ Paid
Average Balance Interest Income/ Expense Average Rates
Earned/ Paid
Average Balance Interest Income/ Expense Average Rates
Earned/ Paid
Average Balance Interest Income/ Expense Average Rates
Earned/ Paid
 Average Balance Interest Income/ Expense Average Rates
Earned/ Paid
Average Balance Interest Income/ Expense Average Rates
Earned/ Paid
Assets:                                                         
Interest-bearing deposits with other banks$37,843 $73 0.77%$32,742 $132 1.64%$38,957 $83 0.85%$37,467 $64 0.68%$37,215 $64 0.69% $35,306 $205 1.17%$37,627 $117 0.63%
Investment securities - available for sale:                      
Taxable560,999 3,400 2.43%543,687 3,363 2.51%524,117 3,075 2.33%514,360 2,910 2.24%514,966 2,843 2.21% 552,391 6,763 2.47%506,887 5,472 2.18%
Tax-exempt7,530 43 2.29%9,795 55 2.28%13,184 70 2.11%16,056 83 2.05%18,215 93 2.05% 8,656 98 2.28%19,352 193 2.01%
Total investment securities - available for sale568,529 3,443 2.43%553,482 3,418 2.50%537,301 3,145 2.32%530,416 2,993 2.24%533,181 2,936 2.21% 561,047 6,861 2.47%526,239 5,665 2.17%
                       
Investment securities - held to maturity10,417 71 2.73%8,804 67 3.09%8,761 63 2.85%8,378 55 2.60%7,866 58 2.96% 9,615 138 2.89%7,889 116 2.97%
Investment securities - trading8,572 24 1.12%7,629 22 1.17%8,203 96 4.64%8,204 30 1.45%8,202 22 1.08% 8,103 46 1.14%8,270 43 1.05%
                       
Loans and leases *3,524,219 44,903 5.11%3,477,739 44,958 5.24%3,399,484 44,274 5.17%3,379,699 42,214 4.96%3,353,339 41,782 5.00% 3,501,107 89,861 5.18%3,322,447 82,536 5.01%
Total interest-earning assets4,149,580 48,514 4.69%4,080,396 48,597 4.83%3,992,706 47,661 4.74%3,964,164 45,356 4.54%3,939,803 44,862 4.57% 4,115,178 97,111 4.76%3,902,472 88,477 4.57%
                       
Cash and due from banks13,725   14,414   13,962   7,587   7,153    14,068   8,916   
Less: allowance for loan and lease losses(20,844)  (19,887)  (18,625)  (19,467)  (18,043)   (20,368)  (17,837)  
Other assets509,164   470,206   424,957   423,864   415,628    489,794   402,086   
Total assets$4,651,625   $4,545,129   $4,413,000   $4,376,148   $4,344,541    $4,598,672   $4,295,637   
                       
Liabilities:                      
Interest-bearing deposits:                      
Savings, NOW and market rate deposits$1,928,755 $5,040 1.05%$1,798,103 $3,764 0.85%$1,704,065 $2,883 0.67%$1,695,214 $2,425 0.57%$1,722,328 $2,073 0.48% $1,863,790 $8,804 0.95%$1,701,732 $3,552 0.42%
Wholesale deposits345,782 2,143 2.49%342,696 2,012 2.38%346,134 1,986 2.28%256,347 1,329 2.06%233,714 973 1.67% 344,247 4,155 2.43%232,508 1,706 1.48%
Retail time deposits520,317 2,472 1.91%533,395 2,321 1.76%552,213 2,179 1.57%541,652 1,779 1.30%533,254 1,453 1.09% 526,820 4,793 1.83%530,378 2,713 1.03%
Total interest-bearing deposits2,794,854 9,655 1.39%2,674,194 8,097 1.23%2,602,412 7,048 1.07%2,493,213 5,533 0.88%2,489,296 4,499 0.72% 2,734,857 17,752 1.31%2,464,618 7,971 0.65%
Borrowings:                      
Short-term borrowings68,529 357 2.09%157,652 943 2.43%128,429 681 2.10%208,201 1,096 2.09%205,323 985 1.92% 112,844 1,300 2.32%189,019 1,615 1.72%
Long-term FHLB advances52,397 269 2.06%55,385 278 2.04%67,363 331 1.95%81,460 394 1.92%102,023 490 1.93% 53,883 547 2.05%112,911 1,052 1.88%
Subordinated notes98,587 1,144 4.65%98,542 1,145 4.71%98,497 1,145 4.61%98,457 1,144 4.61%98,463 1,143 4.66% 98,564 2,289 4.68%98,447 2,286 4.68%
Jr. subordinated debt21,637 352 6.53%21,595 358 6.72%21,553 342 6.30%21,511 337 6.22%21,470 321 6.00% 21,616 710 6.62%21,450 609 5.73%
Total borrowings241,150 2,122 3.53%333,174 2,724 3.32%315,842 2,499 3.14%409,629 2,971 2.88%427,279 2,939 2.76% 286,907 4,846 3.41%421,827 5,562 2.66%
Total interest-bearing liabilities3,036,004 11,777 1.56%3,007,368 10,821 1.46%2,918,254 9,547 1.30%2,902,842 8,504 1.16%2,916,575 7,438 1.02% 3,021,764 22,598 1.51%2,886,445 13,533 0.95%
Noninterest-bearing deposits909,945   871,726   878,047   866,314   841,676    890,941   840,571   
Other liabilities124,211   93,949   60,393   59,085   52,389    109,165   42,482   
Total noninterest-bearing liabilities1,034,156   965,675   938,440   925,399   894,065    1,000,106   883,053   
Total liabilities4,070,160   3,973,043   3,856,694   3,828,241   3,810,640    4,021,870   3,769,498   
Shareholders' equity581,465   572,086   556,306   547,907   533,901    576,802   526,139   
Total liabilities and shareholders' equity$4,651,625   $4,545,129   $4,413,000   $4,376,148   $4,344,541    $4,598,672   $4,295,637   
Net interest spread  3.13%  3.37%  3.44%  3.38%  3.55%   3.25%  3.62%
Effect of noninterest-bearing sources  0.42%  0.38%  0.35%  0.31%  0.26%   0.40%  0.25%
Tax-equivalent net interest margin $36,737 3.55% $37,776 3.75% $38,114 3.79% $36,852 3.69% $37,424 3.81%  $74,513 3.65% $74,944 3.87%
Tax-equivalent adjustment $126 0.01% $129 0.01% $127 0.01% $123 0.01% $108 0.01%  $255 0.01% $189 0.01%
* 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.

Supplemental Information Regarding Accretion of Fair Value Marks

 For the Three Months Ended For the Six Months Ended
 June 30, 2019March 31, 2019December 31, 2018September 30, 2018June 30, 2018 June 30, 2019June 30, 2018
(dollars in thousands)InterestInc. / (Dec.)Effect on Yield or Rate Inc. / (Dec.)Effect on Yield or Rate Inc. / (Dec.)Effect on Yield or Rate Inc. / (Dec.)Effect on Yield or Rate Inc. / (Dec.)Effect on Yield or Rate  Inc. / (Dec.)Effect on Yield or Rate Inc. / (Dec.)Effect on Yield or Rate
Loans and leasesIncome$1,193 0.14% $1,997 0.23% $2,492 0.29% $1,464 0.17% $1,945 0.23%  $3,190 0.18% $4,647 0.28%
Retail time depositsExpense(171)(0.13)% (222)(0.17)% (279)(0.20)% (311)(0.23)% (339)(0.25)%  (393)(0.15)% (719)(0.27)%
Long-term FHLB advancesExpense34 0.26% 33 0.24% 34 0.20% 32 0.16% 25 0.10%  67 0.25% 40 0.07%
Jr. subordinated debtExpense43 0.80% 42 0.79% 42 0.77% 41 0.76% 41 0.77%  85 0.79% 81 0.76%
Net interest income from fair value marks $1,287   $2,144   $2,695   $1,702   $2,218    $3,431   $5,245  
Purchase accounting effect on tax-equivalent margin  0.12%  0.21%  0.27%  0.17%  0.23%   0.17%  0.27%

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 Six Months Ended
 June 30,
2019
 March 31,
2019
 December 31, 2018 September 30, 2018 June 30,
2018
 June 30,
2019
 June 30,
2018
Reconciliation of Net Income to Net Income (core):             
Net income attributable to BMBC (a GAAP measure)$15,785  $10,677  $17,136  $16,682  $14,688  $26,462  $29,974 
Less: Tax-effected non-core noninterest income:             
Gain on sale of investment securities available for sale            (6)
Add: Tax-effected non-core noninterest expense items:             
Due diligence, merger-related and merger integration expenses      307  2,412    5,824 
Voluntary years of service incentive program expenses  3,553        3,553   
Add: Federal income tax expense related to re-measurement of net deferred tax asset due to tax reform legislation    31  151  (69)   521 
Net income (core) (a non-GAAP measure)$15,785  $14,230  $17,167  $17,140  $17,031  $30,015  $36,313 
              
Calculation of Basic and Diluted Earnings per Common Share (core):             
Weighted average common shares outstanding20,144,651  20,168,498  20,225,993  20,270,706  20,238,852  20,156,509  20,221,010 
Dilutive common shares99,758  103,163  95,290  167,670  174,726  99,960  206,782 
Weighted average diluted shares20,244,409  20,271,661  20,321,283  20,438,376  20,413,578  20,256,469  20,427,792 
Basic earnings per common share (core) (a non-GAAP measure)$0.78  $0.71  $0.85  $0.85  $0.84  $1.49  $1.80 
Diluted earnings per common share (core) (a non-GAAP measure)$0.78  $0.70  $0.84  $0.84  $0.83  $1.48  $1.78 
              
Calculation of Return on Average Tangible Equity:             
Net income attributable to BMBC (a GAAP measure)$15,785  $10,677  $17,136  $16,682  $14,688  $26,462  $29,974 
Add: Tax-effected amortization and impairment of intangible assets755  741  787  705  702  1,496  1,397 
Net tangible income (numerator)$16,540  $11,418  $17,923  $17,387  $15,390  $27,958  $31,371 
              
Average shareholders' equity$581,465  $572,086  $556,306  $547,907  $533,901  $576,802  $526,139 
Less: Average Noncontrolling interest688  685  681  678  685  687  684 
Less: Average goodwill and intangible assets(205,593) (206,716) (207,893) (207,880) (208,039) (206,152) (206,790)
Net average tangible equity (denominator)$376,560  $366,055  $349,094  $340,705  $326,547  $371,337  $320,033 
              
Return on tangible equity (a non-GAAP measure)17.62% 12.65% 20.37% 20.25% 18.90% 15.18% 19.77%
              
Calculation of Return on Average Tangible Equity (core):             
Net income (core) (a non-GAAP measure)$15,785  $14,230  $17,167  $17,140  $17,031  $30,015  $36,313 
Add: Tax-effected amortization and impairment of intangible assets755  741  787  705  702  1,496  1,397 
Net tangible income (core) (numerator)$16,540  $14,971  $17,954  $17,845  $17,733  $31,511  $37,710 
              
Average shareholders' equity$581,465  $572,086  $556,306  $547,907  $533,901  $576,802  $526,139 
Less: Average Noncontrolling interest688  685  681  678  685  687  684 
Less: Average goodwill and intangible assets(205,593) (206,716) (207,893) (207,880) (208,039) (206,152) (206,790)
Net average tangible equity (denominator)$376,560  $366,055  $349,094  $340,705  $326,547  $371,337  $320,033 
              
Return on tangible equity (core) (a non-GAAP measure)17.62% 16.59% 20.40% 20.78% 21.78% 17.11% 23.76%

 

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 Six Months Ended
 June 30,
2019
 March 31,
2019
 December 31,
2018
 September 30,
2018
 June 30,
2018
 June 30,
2019
 June 30,
2018
Calculation of Tangible Equity Ratio (BMBC):             
Total shareholders' equity$590,155  $575,107  $564,704  $551,425  $542,503     
Less: Noncontrolling interest693  686  685  678  677     
Less: Goodwill and intangible assets(205,050) (206,006) (207,467) (208,165) (208,139)    
Net tangible equity (numerator)$385,798  $369,787  $357,922  $343,938  $335,041     
              
Total assets$4,736,565  $4,631,993  $4,652,485  $4,388,442  $4,394,203     
Less: Goodwill and intangible assets(205,050) (206,006) (207,467) (208,165) (208,139)    
Tangible assets (denominator)$4,531,515  $4,425,987  $4,445,018  $4,180,277  $4,186,064     
              
Tangible equity ratio (BMBC)(1)8.51% 8.35% 8.05% 8.23% 8.00%    
              
Calculation of Tangible Equity Ratio (BMTC):             
Total shareholders' equity$625,464  $605,985  $591,695  $582,698  $582,354     
Less: Noncontrolling interest693  686  685  678  677     
Less: Goodwill and intangible assets(192,450) (193,329) (194,715) (195,337) (195,245)    
Net tangible equity (numerator)$433,707  $413,342  $397,665  $388,039  $387,786     
              
Total assets$4,721,394  $4,616,724  $4,637,481  $4,372,590  $4,378,508     
Less: Goodwill and intangible assets(192,450) (193,329) (194,715) (195,337) (195,245)    
Tangible assets (denominator)$4,528,944  $4,423,395  $4,442,766  $4,177,253  $4,183,263     
              
Tangible equity ratio (BMTC)(1)9.58% 9.34% 8.95% 9.29% 9.27%    
              
Calculation of Return on Average Assets (core)             
Return on average assets (GAAP)1.36% 0.95% 1.54% 1.51% 1.36% 1.16% 1.41%
Effect of adjustment to GAAP net income to core net income% 0.32% % 0.04% 0.21% 0.16% 0.29%
Return on average assets (core)1.36% 1.27% 1.54% 1.55% 1.57% 1.32% 1.70%
              
Calculation of Return on Average Equity (core)             
Return on average equity (GAAP)10.89% 7.57% 12.22% 12.08% 11.03% 9.25% 11.49%
Effect of adjustment to GAAP net income to core net income% 2.52% 0.02% 0.33% 1.76% 1.24% 2.43%
Return on average equity (core)10.89% 10.09% 12.24% 12.41% 12.79% 10.49% 13.92%
              
Calculation of Tax-equivalent net interest margin adjusting for the impact of purchase accounting             
Tax-equivalent net interest margin3.55% 3.75% 3.79% 3.69% 3.81% 3.65% 3.87%
Effect of fair value marks0.12% 0.21% 0.27% 0.17% 0.23% 0.17% 0.27%
Tax-equivalent net interest margin adjusting for the impact of purchase accounting3.43% 3.54% 3.52% 3.52% 3.58% 3.48% 3.60%
  1. Capital Ratios for the current quarter are to be considered preliminary until the Call Reports are filed.
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 Six Months Ended
 June 30,
2019
 March 31,
2019
 December 31,
2018
 September 30,
2018
 June 30,
2018
 June 30,
2019
 June 30,
2018
Calculation of Tax-equivalent net interest income adjusting for the impact of purchase accounting             
Tax-equivalent net interest income$36,737  $37,776  $38,114  $36,852  $37,424     
Effect of fair value marks1,287  2,144  2,695  1,702  2,218     
Tax-equivalent net interest income adjusting for the impact of purchase accounting$35,450  $35,632  $35,419  $35,150  $35,206     
              
Calculation of Efficiency Ratio:             
Noninterest expense$35,188  $39,724  $34,845  $33,592  $35,836  $74,912  $71,866 
Less: certain noninterest expense items*:             
Amortization of intangibles(956) (938) (997) (891) (889) (1,894) (1,768)
Due diligence, merger-related and merger integration expenses      (389) (3,053)   (7,372)
Voluntary years of service incentive program expenses  (4,498)       (4,498)  
Noninterest expense (adjusted) (numerator)$34,232  $34,288  $33,848  $32,312  $31,894  $68,520  $62,726 
              
Noninterest income$20,221  $19,253  $18,097  $18,274  $20,075  $39,474  $39,611 
Less: non-core noninterest income items:             
Gain on sale of investment securities available for sale            (7)
Noninterest income (core)$20,221  $19,253  $18,097  $18,274  $20,075  $39,474  $39,604 
Net interest income36,611  37,647  37,987  36,729  37,316  74,258  74,755 
Noninterest income (core) and net interest income (denominator)$56,832  $56,900  $56,084  $55,003  $57,391  $113,732  $114,359 
              
Efficiency ratio60.23% 60.26% 60.35% 58.75% 55.57% 60.25% 54.85%
              
Supplemental Loan and Allowance Information Used to Calculate Non-GAAP Measures             
Total Allowance$21,182  $20,616  $19,426  $18,684  $19,398     
Less: Allowance on acquired loans106  97  97  72  217     
Allowance on originated loans and leases$21,076  $20,519  $19,329  $18,612  $19,181     
              
Total Allowance$21,182  $20,616  $19,426  $18,684  $19,398     
Loan mark on acquired loans14,174  15,841  17,822  24,964  26,705     
Total Allowance + Loan mark$35,356  $36,457  $37,248  $43,648  $46,103     
              
Total Portfolio loans and leases$3,534,665  $3,523,514  $3,427,154  $3,381,475  $3,389,501     
Less: Originated loans and leases3,088,849  3,032,270  2,885,251  2,752,160  2,700,815     
Net acquired loans$445,816  $491,244  $541,903  $629,315  $688,686     
Add: Loan mark on acquired loans14,174  15,841  17,822  24,964  26,705     
Gross acquired loans (excludes loan mark)$459,990  $507,085  $559,725  $654,279  $715,391     
Originated loans and leases3,088,849  3,032,270  2,885,251  2,752,160  2,700,815     
Total Gross portfolio loans and leases$3,548,839  $3,539,355  $3,444,976  $3,406,439  $3,416,206     

* 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.