OAK RIDGE, N.J., Jan. 24, 2020 (GLOBE NEWSWIRE) -- Lakeland Bancorp, Inc. (NASDAQ: LBAI) (the “Company”), the parent company of Lakeland Bank (“Lakeland”), reported net income of $18.7 million and earnings per diluted share ("EPS") of $0.37 for the three months ended December 31, 2019 compared to net income of $15.6 million and diluted EPS of $0.32 for the fourth quarter of 2018. For the fourth quarter of 2019, annualized return on average assets was 1.15%, annualized return on average common equity was 10.32% and annualized return on average tangible common equity was 13.29%.

For the year ended December 31, 2019, the Company reported net income of $70.7 million, an 11% increase compared to $63.4 million for the same period in 2018 resulting in annualized return on average assets of 1.12%, annualized return on average common equity of 10.14%, and annualized return on average tangible common equity of 13.16%. For 2019, the Company reported diluted EPS of $1.38, compared to diluted EPS of $1.32 for 2018. Excluding merger-related expenses pertaining to the Company’s January 2019 acquisition of Highlands Bancorp, Inc. ("Highlands") of $2.4 million, tax-effected, net income for the year ended December 31, 2019 was $73.0 million, or $1.43 per diluted share. Excluding merger-related expenses, annualized return on average assets was 1.16%, annualized return on average common equity was 10.48% and annualized return on average tangible common equity was 13.60%.

Thomas Shara, Lakeland Bancorp’s President and CEO commented, "2019 was another fantastic year for our Company, marking our 8th consecutive year of record earnings. Our strong loan and deposit growth enabled us to conclude 2019 on an extremely positive note. This success is the result of our associates’ hard work, commitment and passion for excellence.

Some of the 2019 highlights are

  • Total asset growth of 16% to $6.7 billion
     
  • Solid organic loan growth of 6%, including 4% in the 4th quarter
     
  • Consistent deposit generation of 6%, including 10% growth in non-interest bearing deposits
     
  • Seamless integration of Highlands State Bank acquisition
     
  • Forbes recognition as the Best-In-State Bank in New Jersey

To sustain our high performance and increase shareholder value, we have embarked on a digital strategy initiative, impacting all operational areas of the Bank.  Enhancing our digital capabilities will allow Lakeland to expand our market presence as a community bank, as well as compete long-term in a fast-paced digital marketplace.”

Net Interest Margin and Net Interest Income

Net interest margin for the fourth quarter of 2019 of 3.27% increased two basis points from the linked quarter and decreased two basis points compared to the fourth quarter of 2018, which was due primarily to an increase in the cost of interest bearing liabilities. Net interest margin for 2019 was 3.33% compared to 3.36% for the same period in 2018.

The yield on interest-earning assets for the fourth quarter of 2019 was 4.21% compared to 4.20% for the fourth quarter of 2018. The yield on interest-earning assets for 2019 was 4.36% compared to 4.12% for 2018. The year-to-date increase in yield on interest-earning assets, when compared to the prior year period, was a result of originating higher yielding loans, increased prepayment fees, additional accretion income on loans resulting from the Highlands acquisition and higher investment securities yields.

The cost of interest-bearing liabilities for the fourth quarter of 2019 was 1.26% compared to 1.41% for the linked quarter and 1.21% for the fourth quarter of 2018. The cost of interest-bearing liabilities for 2019 was 1.35% compared to 1.01% during the same period in 2018. The cost of interest-bearing transaction accounts, time deposits and borrowings have increased since 2018 largely driven by competitive pressures and higher market interest rates.

Net interest income increased to $49.5 million for the fourth quarter of 2019 compared to $44.2 million for the fourth quarter of 2018, due primarily to the growth of interest-earning assets and increases in loan yields, partially offset by an increase in average interest-bearing liabilities and higher interest rates on interest-bearing liabilities. Net interest income for 2019 was $196.0 million, as compared to $173.6 million for the same period in 2018 due to the same reasons as the quarterly comparison.

Noninterest Income

Noninterest income increased $2.4 million to $8.0 million for the fourth quarter of 2019 from $5.6 million for the fourth quarter of 2018. Other income increased $1.8 million compared to the fourth quarter of 2018 due primarily to an increase in swap income and gains resulting from payoffs of purchased credit impaired loans during the fourth quarter of 2019.

For 2019, noninterest income totaled $26.8 million compared to $22.3 million for the same period in 2018 as the Company recorded a $496,000 gain on equity securities in 2019 compared to losses of $583,000 during the same period in 2018. In addition, commissions and fees increased $688,000 compared to 2018 due primarily to an increase in investment services income and commercial loan fees, while service charges on deposit accounts increased $621,000 due primarily to deposit growth.  Income on bank owned life insurance decreased $516,000 compared to 2018 due primarily to the receipt of insurance proceeds of $421,000 in 2018.  Other income increased $2.3 million compared to 2018 due primarily to the same reasons discussed above in the quarterly comparison.

Noninterest Expense

Noninterest expense totaled $31.5 million for the fourth quarter of 2019 and increased $2.9 million compared to the fourth quarter of 2018 due primarily to salary and employee benefit expense which increased $1.9 million as a result of staff additions from the Highlands merger, normal merit increases and higher benefit costs.  Furniture and equipment increased $306,000 due primarily to an increase in service agreement expense compared to the fourth quarter of 2018, while marketing expense increased $238,000 due primarily to  the timing of marketing campaigns.  In the fourth quarter of 2019, no FDIC expense was recorded compared to $383,000 in the fourth quarter of 2018 due to assessment credits from the FDIC, resulting from the insurance fund reserve ratio exceeding the required level. Additionally, there were no merger-related expenses booked in the fourth quarter of 2019 compared to  $464,000 during the same period in 2018. Other expenses in 2019 were $811,000 greater than 2018 due primarily to increased donations, audit expense and loan-related expenses.

For 2019, noninterest expense totaled $126.8 million compared to $111.2 million for the same period in 2018. Excluding merger-related expenses of $3.2 million in 2019 and $464,000 in 2018, noninterest expense increased $12.9 million compared to 2018 primarily as a result of additional salary and benefit expenses, as well as Highlands expenses from the merger date in January 2019 through the system conversion date in April and increased data processing expenses. Net occupancy increased $874,000 during 2019 compared to 2018 due primarily to the addition of Highlands branches as well as the acceleration of rental expense on a leased branch slated to close. FDIC insurance expense decreased $1.2 million compared to 2018 due to the credits mentioned above. Other expenses increased $1.3 million compared to 2018 due primarily to increased consulting expense and donations.

Income Tax Expense

The effective tax rate for the fourth quarter of 2019 was 24.9% compared to 24.4% for the fourth quarter of 2018. The effective tax rate for 2019 was 24.8% compared to 21.0% for 2018.

Financial Condition

At December 31, 2019, total assets were $6.71 billion, an increase of $905.1 million, including $496.5 million from the Highlands acquisition compared to December 31, 2018. For the twelve months ended December 31, 2019, total loans grew $681.1 million, including $425.0 million from Highlands, to $5.14 billion and investment securities increased $97.4 million, including $24.5 million from Highlands, to $918.9 million. On the funding side, total deposits increased $673.1 million, including $409.6 million from Highlands, to $5.29 billion, while borrowings increased $92.6 million to $612.7 million. At December 31, 2019, total loans as a percent of total deposits was 97.1%.

Asset Quality

At December 31, 2019, non-performing assets increased to $21.7 million, 0.32% of total assets, compared to $13.0 million, 0.22% of total assets, at December 31, 2018. Non-accrual loans as a percent of total loans increased to 0.41% at December 31, 2019 compared to 0.27% at December 31, 2018. The allowance for loan losses increased to $40.0 million, 0.78% of total loans, at December 31, 2019, compared to $37.7 million, 0.84% of total loans, at December 31, 2018. The Company's allowance for loan losses excluding acquired loans would be 0.88%. In the fourth quarter of 2019, the Company had net recoveries of $262,000, or 0.02% of average loans, annualized, compared to net charge-offs of $196,000, or 0.02% of average loans, annualized, for the same period in 2018. Provision for loan losses for the fourth quarter of 2019 was $1.1 million compared to provision for loan losses of $591,000 in the fourth quarter of 2018.

Capital

At December 31, 2019, stockholders' equity was $725.3 million compared to $623.7 million at December 31, 2018, a 16% increase. Lakeland Bancorp remains above FDIC “well capitalized” standards, with a Tier 1 leverage ratio of 9.41% at December 31, 2019. The book value per common share and tangible book value per common share both increased 9% to $14.36 and $11.18, respectively, compared to $13.14 and $10.22 at December 31, 2018. On January 22, 2020, the Company declared a quarterly cash dividend of $0.125 per share to be paid on February 14, 2020, to shareholders of record as of February 4, 2020.

Forward-Looking Statements

The information disclosed in this document includes various forward-looking statements that are made in reliance upon the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The words “anticipates”, “projects”, “intends”, “estimates”, “expects”, “believes”, “plans”, “may”, “will”, “should”, “could”, and other similar expressions are intended to identify such forward-looking statements. The Company cautions that these forward-looking statements are necessarily speculative and speak only as of the date made, and are subject to numerous assumptions, risks and uncertainties, all of which may change over time. Actual results could differ materially from such forward-looking statements. The following factors, among others, could cause actual results to differ materially and adversely from such forward-looking statements: changes in the financial services industry and the U.S. and global capital markets, changes in economic conditions nationally, regionally and in the Company’s markets, the nature and timing of actions of the Federal Reserve Board and other regulators, the nature and timing of legislation and regulation affecting the financial services industry, government intervention in the U.S. financial system, changes in federal and state tax laws, changes in levels of market interest rates, pricing pressures on loan and deposit products, credit risks of the Company’s lending and leasing activities, successful implementation, deployment and upgrades of new and existing technology, systems, services and products, customers’ acceptance of the Company’s products and services, competition and failure to realize anticipated efficiencies and synergies from the merger of Highlands Bancorp, Inc. into Lakeland Bancorp and the merger of Highlands State Bank into Lakeland Bank. Any statements made by the Company that are not historical facts should be considered to be forward-looking statements. The Company is not obligated to update and does not undertake to update any of its forward-looking statements made herein.

Explanation of Non-GAAP Financial Measures

Reported amounts are presented in accordance with accounting principles generally accepted in the United States of America ("GAAP"). This press release also contains certain supplemental non-GAAP information that the Company’s management uses in its analysis of the Company’s financial results. Specifically, the Company provides measures based on what it believes are its operating earnings on a consistent basis, and excludes material non-routine operating items which affect the GAAP reporting of results of operations. The Company’s management believes that providing this information to analysts and investors allows them to better understand and evaluate the Company’s core financial results for the periods in question.

The Company also provides measurements and ratios based on tangible equity and tangible assets. These measures are utilized by regulators and market analysts to evaluate a company’s financial condition and, therefore, the Company’s management believes that such information is useful to investors.

The Company also uses an efficiency ratio that is a non-GAAP financial measure. The ratio that the Company uses excludes amortization of core deposit intangibles, provision for unfunded lending commitments and, where applicable, long-term debt prepayment fees and merger-related expenses. Income for the non-GAAP ratio is increased by the favorable effect of tax-exempt income and excludes gains and losses from the sale of investment securities and gain on debt extinguishment, which can vary from period to period. The Company uses this ratio because it believes the ratio provides a relevant measure to compare the operating performance period to period.

These disclosures should not be viewed as a substitute for financial results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures which may be presented by other companies. See accompanying non-GAAP tables.

About Lakeland

Lakeland Bancorp, Inc. (NASDAQ:LBAI) has approximately $6.71 billion in total assets. Lakeland Bank, a wholly-owned subsidiary of Lakeland Bancorp, Inc., operates 52 branch offices throughout Bergen, Essex, Morris, Ocean, Passaic, Somerset, Sussex, and Union counties in New Jersey including one branch in Highland Mills, New York; five New Jersey regional commercial lending centers in Bernardsville, Jackson, Montville, Teaneck and Waldwick; and one New York commercial lending center to serve the Hudson Valley region. Lakeland also has a commercial loan production office serving Middlesex and Monmouth counties in New Jersey. Lakeland Bank offers an extensive suite of financial products and services for businesses and consumers. Visit LakelandBank.com for more information.

Thomas J. Shara
President & CEO

Thomas F. Splaine
EVP & CFO
973-697-2000


Lakeland Bancorp, Inc.
Financial Highlights
(Unaudited)
        
 Three Months Ended
December 31,
 Twelve Months Ended
December 31,
(Dollars in thousands, except per share amounts)2019 2018 2019 2018
INCOME STATEMENT       
Net interest income$49,548  $44,206  $196,034  $173,559 
Provision for loan losses(1,086) (591) (2,130) (4,413)
Gains on sales of loans375  299  1,660  1,329 
Gain (loss) on equity securities(29) (199) 496  (583)
Other noninterest income7,638  5,528  24,640  21,564 
Merger-related expenses  (464) (3,178) (464)
Other noninterest expense(31,523) (28,199) (123,578) (110,703)
  Pretax income24,923  20,580  93,944  80,289 
Provision for income taxes(6,208) (5,030) (23,272) (16,888)
  Net income$18,715  $15,550  $70,672  $63,401 
        
Basic earnings per common share$0.37  $0.32  $1.39  $1.32 
Diluted earnings per common share$0.37  $0.32  $1.38  $1.32 
Dividends paid per common share$0.125  $0.115  $0.490  $0.445 
Weighted average shares - basic50,566  47,605  50,477  47,578 
Weighted average shares - diluted50,748  47,780  50,642  47,766 
        
SELECTED OPERATING RATIOS       
Annualized return on average assets1.15% 1.08% 1.12% 1.15%
Annualized return on average common equity10.32% 10.05% 10.14% 10.59%
Annualized return on average tangible common equity (1)13.29% 12.98% 13.16% 13.78%
Annualized yield on interest-earning assets4.21% 4.20% 4.36% 4.12%
Annualized cost of interest-bearing liabilities1.26% 1.21% 1.35% 1.01%
Annualized net interest spread2.96% 2.99% 3.00% 3.11%
Annualized net interest margin3.27% 3.29% 3.33% 3.36%
Efficiency ratio (1)54.20% 56.18% 54.83% 56.09%
Stockholders' equity to total assets    10.81% 10.74%
Book value per common share    $14.36  $13.14 
Tangible book value per common share (1)    $11.18  $10.22 
Tangible common equity to tangible assets (1)    8.62% 8.57%
        
ASSET QUALITY RATIOS    December 31,
2019
 December 31,
2018
Ratio of allowance for loan losses to total loans    0.78% 0.84%
Non-performing loans to total loans    0.41% 0.27%
Non-performing assets to total assets    0.32% 0.22%
Annualized net charge-offs (recoveries) to average loans    % 0.05%
        
(1) See Supplemental Information - Non-GAAP Financial Measures      
        
        
        
Lakeland Bancorp, Inc.
Financial Highlights
(Unaudited)
        
(Dollars in thousands)    December 31,
2019
 December 31,
2018
SELECTED BALANCE SHEET DATA AT PERIOD-END       
Loans    $5,137,823  $4,460,447 
Allowance for loan losses    40,003  37,688 
Investment securities    918,853  821,486 
Total assets    6,711,236  5,806,093 
Total deposits    5,293,779  4,620,670 
Short-term borrowings    328,658  233,905 
Other borrowings    284,036  286,145 
Stockholders' equity    725,263  623,739 
        
 Three Months Ended
December 31,
 Twelve Months Ended
December 31,
 2019 2018 2019 2018
SELECTED AVERAGE BALANCE SHEET DATA       
Loans$5,025,377  $4,393,382  $4,938,298  $4,283,401 
Investment securities894,698  823,193  869,374  816,697 
Interest-earning assets6,022,525  5,346,934  5,895,669  5,182,194 
Total assets6,470,082  5,694,827  6,322,654  5,528,914 
Noninterest-bearing demand deposits1,130,192  1,003,508  1,092,827  984,445 
Savings deposits492,903  483,606  500,650  489,742 
Interest-bearing transaction accounts2,814,831  2,446,325  2,653,404  2,301,065 
Time deposits873,924  769,129  922,412  778,180 
Total deposits5,311,850  4,702,568  5,169,293  4,553,432 
Short-term borrowings67,097  50,196  95,035  53,775 
Other borrowings284,049  288,126  290,330  286,639 
Total interest-bearing liabilities4,532,804  4,037,382  4,461,831  3,909,401 
Stockholders' equity719,292  613,583  697,037  598,527 
        


Lakeland Bancorp, Inc.
Consolidated Statements of Income
(Unaudited)
      
 Three Months Ended
December 31,
 Twelve Months Ended
December 31,
(Dollars in thousands, except per share amounts)20192018 20192018
      
INTEREST INCOME     
Loans and net deferred fees and costs$58,211 $50,759  $233,535 $193,143 
Federal funds sold and interest-bearing deposits with banks423 715  1,720 1,559 
Taxable investment securities and other4,857 4,550  19,722 16,710 
Tax exempt investment securities345 410  1,510 1,709 
TOTAL INTEREST INCOME63,836 56,434  256,487 213,121 
INTEREST EXPENSE     
Deposits11,722 9,935  49,248 30,620 
Federal funds purchased and securities sold under agreements to repurchase138 62  1,471 471 
Other borrowings2,428 2,231  9,734 8,471 
TOTAL INTEREST EXPENSE14,288 12,228  60,453 39,562 
NET INTEREST INCOME49,548 44,206  196,034 173,559 
Provision for loan losses1,086 591  2,130 4,413 
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES48,462 43,615  193,904 169,146 
NONINTEREST INCOME     
Service charges on deposit accounts3,026 2,814  11,205 10,584 
Commissions and fees1,548 1,446  6,230 5,542 
Income on bank owned life insurance676 699  2,740 3,256 
Gain on equity securities(29)(199) 496 (583)
Gains on sales of loans375 299  1,660 1,329 
Other income2,388 569  4,465 2,182 
TOTAL NONINTEREST INCOME7,984 5,628  26,796 22,310 
NONINTEREST EXPENSE     
Salaries and employee benefit expense19,615 17,674  77,287 68,595 
Net occupancy expense2,679 2,498  11,029 10,155 
Furniture and equipment expense2,316 2,010  8,681 8,297 
FDIC insurance expense 383  431 1,608 
Stationary, supplies and postage expense385 395  1,599 1,625 
Marketing expense515 277  1,945 1,437 
Data processing expense1,113 1,084  4,913 3,609 
Telecommunications expense492 448  1,943 1,769 
ATM and debit card expense604 571  2,377 2,195 
Core deposit intangible amortization289 142  1,182 594 
Other real estate owned and other repossessed assets expense33 46  256 158 
Merger-related expenses 464  3,178 464 
Other expenses3,482 2,671  11,935 10,661 
TOTAL NONINTEREST EXPENSE31,523 28,663  126,756 111,167 
INCOME BEFORE PROVISION FOR INCOME TAXES24,923 20,580  93,944 80,289 
Provision for income taxes6,208 5,030  23,272 16,888 
NET INCOME$18,715 $15,550  $70,672 $63,401 
EARNINGS PER COMMON SHARE:     
Basic$0.37 $0.32  $1.39 $1.32 
Diluted$0.37 $0.32  $1.38 $1.32 
DIVIDENDS PAID PER COMMON SHARE$0.125 $0.115  $0.490 $0.445 


Lakeland Bancorp, Inc.
Consolidated Balance Sheets
    
(Dollars in thousands)December 31, 2019 December 31, 2018
 (Unaudited)  
    
ASSETS   
Cash$275,794  $205,199 
Interest-bearing deposits due from banks6,577  3,400 
  Total cash and cash equivalents282,371  208,599 
Investment securities available for sale, at fair value755,900  638,618 
Equity securities, at fair value16,473  15,921 
Investment securities held to maturity; fair value of $124,904 at December 31, 2019 and $150,932 at December 31, 2018123,975  153,646 
Federal Home Loan Bank and other membership stocks, at cost22,505  13,301 
Loans held for sale1,743  1,113 
Loans, net of deferred fees5,137,823  4,456,733 
Allowance for loan losses(40,003) (37,688)
Net loans5,097,820  4,419,045 
Premises and equipment, net47,608  49,175 
Operating lease right-of-use assets18,282   
Accrued interest receivable16,832  16,114 
Goodwill156,277  136,433 
Other identifiable intangible assets4,314  1,768 
Bank owned life insurance112,392  110,052 
Other assets54,744  42,308 
  TOTAL ASSETS$6,711,236  $5,806,093 
    
LIABILITIES AND STOCKHOLDERS' EQUITY   
LIABILITIES   
Deposits:   
Noninterest-bearing$1,124,121  $950,218 
Savings and interest-bearing transaction accounts3,298,854  2,913,414 
Time deposits $250 thousand and under652,144  589,737 
Time deposits over $250 thousand218,660  167,301 
  Total deposits5,293,779  4,620,670 
Federal funds purchased and securities sold under agreements to repurchase328,658  233,905 
Other borrowings165,816  181,118 
Subordinated debentures118,220  105,027 
Operating lease liabilities19,814   
Other liabilities59,686  41,634 
  TOTAL LIABILITIES5,985,973  5,182,354 
    
STOCKHOLDERS' EQUITY   
Common stock, no par value; authorized 100,000,000 shares at December 31, 2019 and at December 31, 2018; issued shares 50,498,410 at December 31, 2019 and 47,486,250 shares at December 31, 2018560,263  514,703 
Retained earnings162,752  116,874 
Accumulated other comprehensive income (loss)2,248  (7,838)
  TOTAL STOCKHOLDERS' EQUITY725,263  623,739 
  TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY$6,711,236  $5,806,093 


Lakeland Bancorp, Inc.
Financial Highlights
(Unaudited)
      
 For the Quarter Ended
 December 30,September 30,June 30,March 31,December 31,
(Dollars in thousands, except per share data)20192019201920192018
      
INCOME STATEMENT     
Net interest income$49,548 $48,682 $49,198 $48,606 $44,206 
Provision for loan losses(1,086)(536) (508)(591)
Gains on sales of loans375 486 428 371 299 
Gain (loss) on equity securities(29)72 100 353 (199)
Other noninterest income7,638 6,142 5,861 4,999 5,528 
Merger-related expenses  (318)(2,860)(464)
Other noninterest expense(31,523)(29,563)(31,368)(31,124)(28,199)
  Pretax income24,923 25,283 23,901 19,837 20,580 
Provision for income taxes(6,208)(6,409)(6,444)(4,211)(5,030)
  Net income$18,715 $18,874 $17,457 $15,626 $15,550 
      
Basic earnings per common share$0.37 $0.37 $0.34 $0.31 $0.32 
Diluted earnings per common share$0.37 $0.37 $0.34 $0.31 $0.32 
Dividends paid per common share$0.125 $0.125 $0.125 $0.115 $0.115 
Dividends paid$6,363 $6,362 $6,357 $5,838 $5,510 
Weighted average shares - basic50,566 50,553 50,509 50,275 47,605 
Weighted average shares - diluted50,748 50,694 50,649 50,442 47,780 
      
SELECTED OPERATING RATIOS     
Annualized return on average assets1.15%1.17%1.12%1.02%1.08%
Annualized return on average common equity10.32%10.61%10.16%9.41%10.05%
Annualized return on average tangible common equity (1)13.29%13.74%13.21%12.32%12.98%
Annualized net interest margin3.27%3.25%3.39%3.42%3.29%
Efficiency ratio (1)54.20%52.77%55.78%56.62%56.18%
Common stockholders' equity to total assets10.81%10.99%10.90%10.70%10.74%
Tangible common equity to tangible assets (1)8.62%8.72%8.61%8.41%8.57%
Tier 1 risk-based ratio11.02%11.24%11.11%10.98%11.27%
Total risk-based ratio13.40%13.70%13.60%13.48%13.71%
Tier 1 leverage ratio9.41%9.34%9.30%9.23%9.39%
Common equity tier 1 capital ratio10.46%10.66%10.52%10.38%10.62%
Book value per common share$14.36 $14.13 $13.85 $13.51 $13.14 
Tangible book value per common share (1)$11.18 $10.94 $10.66 $10.35 $10.22 
      
(1) See Supplemental Information - Non-GAAP Financial Measures    


Lakeland Bancorp, Inc.
Financial Highlights
(Unaudited)
  
 For the Quarter Ended
 December 31,
 September 30, June 30, March 31, December 31,  
(Dollars in thousands)2019
 2019 2019 2019 2018 
                
SELECTED BALANCE SHEET DATA AT PERIOD-END               
Loans$5,140,940 $4,925,998 $4,925,300 $4,924,671 $4,460,447 
Allowance for loan losses40,003 38,655 38,662 37,979 37,688 
Investment securities918,853 905,078 863,474 850,729 821,486 
Total assets6,711,236 6,492,474 6,407,195 6,365,063 5,806,093 
Total deposits5,293,779 5,210,619 5,082,598 5,064,584 4,620,670 
Short-term borrowings328,658 199,326 258,703 261,266 233,905 
Other borrowings284,036 284,029 294,022 293,976 286,145 
Stockholders' equity725,263 713,204 698,463 681,343 623,739 
      
LOANS     
Commercial, real estate$3,924,762 $3,749,413 $3,737,447 $3,769,545 $3,377,324 
Commercial, industrial and other431,934 391,486 407,776 389,230 336,735 
Equipment financing111,076 104,689 99,351 90,791 87,925 
Residential mortgages335,191 337,482 336,810 335,290 329,854 
Consumer and home equity337,977 342,928 343,916 339,815 328,609 
  Total loans$5,140,940 $4,925,998 $4,925,300 $4,924,671 $4,460,447 
      
DEPOSITS     
Noninterest-bearing$1,124,121 $1,101,083 $1,089,474 $1,071,890 $950,218 
Savings and interest-bearing transaction accounts3,298,854 3,196,323 3,007,784 3,046,322 2,913,414 
Time deposits870,804 913,213 985,340 946,372 757,038 
  Total deposits$5,293,779 $5,210,619 $5,082,598 $5,064,584 $4,620,670 
      
Total loans to total deposits ratio97.1%94.5%96.9%97.2%96.5%
      
SELECTED AVERAGE BALANCE SHEET DATA     
Loans$5,025,377 $4,937,488 $4,917,109 $4,871,534 $4,393,382 
Investment securities894,698 869,734 854,608 858,046 823,193 
Interest-earning assets6,022,525 5,947,645 5,836,333 5,772,853 5,346,934 
Total assets6,470,082 6,379,675 6,256,523 6,183,224 5,694,827 
Noninterest-bearing demand deposits1,130,192 1,100,413 1,083,745 1,056,060 1,003,508 
Savings deposits492,903 494,377 502,340 513,270 483,606 
Interest-bearing transaction accounts2,814,831 2,678,424 2,562,365 2,554,865 2,446,325 
Time deposits873,924 964,159 961,212 890,070 769,129 
Total deposits5,311,850 5,237,373 5,109,662 5,014,265 4,702,568 
Short-term borrowings67,097 74,042 110,941 128,972 50,196 
Other borrowings284,049 287,839 283,177 306,529 288,126 
Total interest-bearing liabilities4,532,804 4,498,841 4,420,035 4,393,706 4,037,382 
Stockholders' equity719,292 705,726 689,324 673,205 613,583 


Lakeland Bancorp, Inc.
Financial Highlights
(Unaudited)
      
 For the Quarter Ended
 December 31,September 30,June 30,March 31,December 31,
(Dollars in thousands)20192019201920192018
AVERAGE ANNUALIZED YIELDS (TAXABLE EQUIVALENT BASIS)     
ASSETS     
Loans4.60%4.71%4.82%4.80%4.58%
Taxable investment securities and other2.34%2.50%2.55%2.49%2.44%
Tax-exempt securities2.69%2.70%2.74%2.74%2.74%
Federal funds sold and interest-bearing cash accounts1.65%1.98%2.15%2.35%2.19%
  Total interest-earning assets4.21%4.32%4.46%4.44%4.20%
      
LIABILITIES     
Savings accounts0.07%0.06%0.06%0.07%0.06%
Interest-bearing transaction accounts1.05%1.24%1.25%1.18%1.04%
Time deposits1.93%2.00%1.96%1.79%1.79%
Borrowings2.86%2.89%2.90%2.82%2.65%
  Total interest-bearing liabilities1.26%1.41%1.42%1.34%1.21%
Net interest spread (taxable equivalent basis)2.96%2.91%3.04%3.10%2.99%
      
Annualized net interest margin (taxable equivalent basis)3.27%3.25%3.39%3.42%3.29%
Annualized cost of deposits0.88%1.00%1.00%0.93%0.84%
      
ASSET QUALITY DATA     
ALLOWANCE FOR LOAN LOSSES     
Balance at beginning of period$38,655 $38,662 $37,979 $37,688 $37,293 
Provision for loan losses1,086 536  508 591 
Charge-offs(198)(809)(413)(516)(381)
Recoveries460 266 1,096 299 185 
  Balance at end of period$40,003 $38,655 $38,662 $37,979 $37,688 
      
NET LOAN CHARGE-OFFS (RECOVERIES)     
Commercial, real estate$(18)$203 $(85)$67 $132 
Commercial, industrial and other13 393 (909)50 (44)
Equipment financing(297) 293 85 28 
Residential mortgages (55)(2)41 (2)
Consumer and home equity40 2 20 (26)82 
  Net charge-offs (recoveries)$(262)$543 $(683)$217 $196 
      
NON-PERFORMING ASSETS     
Commercial, real estate$13,281 $9,164 $10,205 $9,817 $7,192 
Commercial, industrial and other1,539 795 662 2,202 1,019 
Equipment financing284 271 136 383 501 
Residential mortgages3,428 3,250 1,548 1,740 1,986 
Consumer and home equity2,606 2,437 1,873 1,581 1,432 
  Total non-accrual loans21,138 15,917 14,424 15,723 12,130 
Property acquired through foreclosure or repossession563 944 532 715 830 
  Total non-performing assets$21,701 $16,861 $14,956 $16,438 $12,960 
      
Loans past due 90 days or more and still accruing$ $ $ $78 $ 
Loans restructured and still accruing$5,650 $5,029 $5,139 $6,352 $9,293 
      
Ratio of allowance for loan losses to total loans0.78%0.78%0.78%0.77%0.84%
Total non-accrual loans to total loans0.41%0.32%0.29%0.32%0.27%
Total non-performing assets to total assets0.32%0.26%0.23%0.26%0.22%
Annualized net charge-offs (recoveries) to average loans(0.02)%0.04%(0.06)%0.02%0.02%


Lakeland Bancorp, Inc.
Supplemental Information - Non-GAAP Financial Measures
(Unaudited)
      
 At or for the Quarter Ended
 December 31,
September 30,
June 30,
March 31,
December 31,
(Dollars in thousands, except ratios and per share amounts)2019
2019
2019
2019
2018
CALCULATION OF TANGIBLE BOOK VALUE PER COMMON SHARE               
Total common stockholders' equity at end of period - GAAP$725,263 $713,204 $698,463 $681,343 $623,739 
Less:  Goodwill156,277 156,277 155,830 154,153 136,433 
Less:  Other identifiable intangible assets4,314 4,602 4,891 5,192 1,768 
  Total tangible common stockholders' equity at end of period - Non-GAAP$564,672 $552,325 $537,742 $521,998 $485,538 
      
Shares outstanding at end of period50,498 50,489 50,441 50,436 47,486 
      
Book value per share - GAAP$14.36 $14.13 $13.85 $13.51 $13.14 
      
Tangible book value per share - Non-GAAP$11.18 $10.94 $10.66 $10.35 $10.22 
      
CALCULATION OF TANGIBLE COMMON EQUITY TO TANGIBLE ASSETS    
Total tangible common stockholders' equity at end of period - Non-GAAP$564,672 $552,325 $537,742 $521,998 $485,538 
      
Total assets at end of period - GAAP$6,711,236 $6,492,474 $6,407,195 $6,365,063 $5,806,093 
Less:  Goodwill156,277 156,277 155,830 154,153 136,433 
Less:  Other identifiable intangible assets4,314 4,602 4,891 5,192 1,768 
  Total tangible assets at end of period - Non-GAAP$6,550,645 $6,331,595 $6,246,474 $6,205,718 $5,667,892 
      
Common equity to assets - GAAP10.81%10.99%10.90%10.70%10.74%
      
Tangible common equity to tangible assets - Non-GAAP8.62%8.72%8.61%8.41%8.57%
      
CALCULATION OF RETURN ON AVERAGE TANGIBLE COMMON EQUITY    
Net income - GAAP$18,715 $18,874 $17,457 $15,626 $15,550 
      
Total average common stockholders' equity - GAAP$719,292 $705,726 $689,324 $673,205 $613,583 
Less:  Average goodwill156,277 155,835 154,171 153,562 136,433 
Less:  Average other identifiable intangible assets4,468 4,761 5,058 5,254 1,844 
Total average tangible common stockholders' equity - Non-GAAP$558,547 $545,130 $530,095 $514,389 $475,306 
      
Return on average common stockholders' equity - GAAP10.32%10.61%10.16%9.41%10.05%
      
Return on average tangible common stockholders' equity - Non-GAAP13.29%13.74%13.21%12.32%12.98%
      
CALCULATION OF EFFICIENCY RATIO     
Total noninterest expense$31,523 $29,563 $31,686 $33,984 $28,663 
Amortization of core deposit intangibles(289)(288)(301)(304)(142)
Merger-related expenses  (318)(2,860)(464)
Noninterest expense, as adjusted$31,234 $29,275 $31,067 $30,820 $28,057 
      
Net interest income$49,548 $48,682 $49,198 $48,606 $44,206 
Total noninterest income7,984 6,700 6,389 5,723 5,628 
Total revenue57,532 55,382 55,587 54,329 49,834 
Tax-equivalent adjustment on municipal securities91 97 105 108 109 
Total revenue, as adjusted$57,623 $55,479 $55,692 $54,437 $49,943 
Efficiency ratio - Non-GAAP54.20%52.77%55.78%56.62%56.18%


Lakeland Bancorp, Inc.
Supplemental Information - Non-GAAP Financial Measures
(Unaudited)
 For the Twelve Months Ended December 31,
(Dollars in thousands)20192018
   
CALCULATION OF RETURN ON AVERAGE TANGIBLE COMMON EQUITY  
Net income - GAAP$70,672 $63,401 
   
Total average common stockholders' equity - GAAP$697,037 $598,527 
Less:  Average goodwill$154,971 $136,433 
Less:  Average other identifiable intangible assets$4,883 $2,064 
Total average tangible common stockholders' equity - Non-GAAP$537,183 $460,030 
   
Return on average common stockholders' equity - GAAP10.14%10.59%
   
Return on average tangible common stockholders' equity - Non-GAAP13.16%13.78%
   
CALCULATION OF EFFICIENCY RATIO  
Total noninterest expense$126,756 $111,167 
Amortization of core deposit intangibles$(1,182)$(594)
Merger-related expenses$(3,178)$(464)
Noninterest expense, as adjusted$122,396 $110,109 
   
Net interest income$196,034 $173,559 
Noninterest income$26,796 $22,310 
Total revenue$222,830 $195,869 
Tax-equivalent adjustment on municipal securities$401 $454 
Total revenue, as adjusted$223,231 $196,323 
Efficiency ratio - Non-GAAP54.83%56.09%


Lakeland Bancorp, Inc.
Supplemental Information - Reconciliation of Net Income
(Unaudited)
   
  For the Year Ended
December 31,
(Dollars in thousands, except per share amounts) 2019
2018
        
Net income - GAAP $70,672 $63,401 
    
NON-ROUTINE TRANSACTIONS, NET OF TAX   
Tax deductible merger-related expenses 1,878 84 
Non-tax deductible merger-related expenses 491 345 
  Net effect of non-routine transactions 2,369 429 
    
Net income available to common shareholders excluding non-routine transactions $73,041 $63,830 
Less:  Earnings allocated to participating securities (596)(582)
Net Income,  excluding non-routine transactions $72,445 $63,248 
    
Weighted average shares - Basic 50,477 $47,578 
Weighted average shares - Diluted 50,642 $47,766 
    
Basic earnings per share - GAAP $1.39 $1.32 
Diluted earnings per share - GAAP $1.38 $1.32 
    
Basic earnings per share, adjusted for non-routine transactions $1.44 $1.33 
Diluted earnings per share, adjusted for non-routine transactions (Core EPS) $1.43 $1.32 
    
Return on average assets - GAAP 1.12%1.15%
Return on average assets, adjusted for non-routine transactions 1.16%1.15%
    
Return on average common stockholders' equity - GAAP 10.14%10.59%
Return on average common stockholders' equity, adjusted for non-routine transactions 10.48%10.66%
    
Return on average tangible common stockholders' equity - Non-GAAP 13.16%13.78%
Return on average tangible common stockholders' equity - Non-GAAP, adjusted for non-routine transactions 13.60%13.88%