New Hampshire Thrift Bancshares, Inc (NASDAQ:NHTB), the holding company for Lake Sunapee Bank, fsb, with 16 offices in Vermont, has reported consolidated net income for the nine months ended September 30, 2014 of $7.2 million, or $0.85 diluted earnings per common share, compared to $6.4 million, or $0.87 diluted earnings per common share, for same period in 2013, an increase of $770 thousand, or 12%. For the quarter ended September 30, 2014, we reported consolidated net income of $2.7 million, or $0.32 diluted earnings per common share, compared to $2.6 million, or $0.35 diluted earnings per common share, for the quarter ended September 30, 2013, an increase of $132 thousand, or 5.13%.
"We are pleased with these results as our strategic initiatives of entering new markets and expanding our product offerings continue to produce steady, improved core earnings," President and Chief Executive Officer, Steve Theroux, commented. "Net interest income has increased as a result of the Randolph acquisition completed in December of 2013 and higher loan volumes being originated, particularly in our Nashua market. Coupled with fees generated through our wealth management and insurance subsidiaries, revenues have been created to offset the decrease of approximately $1.6 million in mortgage banking fees and a non-recurring remeasurent gain of $1.4 million from the Charter Trust purchase realized during the third quarter of 2013."
Financial Highlights
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Total assets increased $59.2 million, or 4.16%, to $1.5 billion at September 30, 2014 from $1.4 billion at December 31, 2013.
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Net loans increased $70.1 million, or 6.18%, to $1.2 billion at September 30, 2014 from $1.1 billion at December 31, 2013.
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During the nine months ended September 30, 2014, we originated $284.9 million in loans, a decrease of 3.31%, compared to $294.7 million during the same period in 2013. During the quarter ended September 30, 2014, we originated $95.3 million in loans, a decrease of 18.71%, compared to $117.2 million during the same period in 2013.
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Our loan servicing portfolio was $409.0 million at September 30, 2014, compared to $417.3 million at December 31, 2013.
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Total deposits increased $23.0 million, or 2.12%, to $1.1 billion at September 30, 2014 from $1.1 billion at December 31, 2013.
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Net interest and dividend income for the nine months ended September 30, 2014 was $31.5 million compared to $24.0 million for the same period in 2013. Net interest and dividend income for the three months ended September 30, 2014 was $10.6 million compared to $8.1 million for the same period in 2013.
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Net income available to common stockholders was $7.0 million for the nine months ended September 30, 2014, compared to $6.2 million for the same period in 2013. Net income available to common stockholders was $2.6 million for the three months ended September 30, 2014, compared to $2.5 million for the same period in 2013.
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As a percentage of total loans, non-performing loans decreased to 1.42% at September 30, 2014 from 1.86% at December 31, 2013.
Earnings Summary for the Nine Months Ended September 30, 2014
Net income of $7.2 million for the nine months ended September 30, 2014 represents the impact of strategic decisions to enhance net interest income and complement noninterest revenue with the 2013 acquisitions of Charter Holding Corp. and Randolph National Bank. Net interest and dividend income, our core source of earnings, increased $7.5 million, or 31.22%, for the nine months ended September 30, 2014, compared to the same period in 2013. This increase represents the combined impact of our acquisition of Randolph National Bank in October 2013 and our originated loan portfolio growth, as well as the additional benefits of our improving spreads and our cost of funds management.
The provision for loan losses increased $42 thousand to $736 thousand which was based on adequacy calculations for the nine months ended September 30, 2014, compared to $694 thousand for the same period in 2013.
Noninterest income increased $3.3 million, or 29.31%, to $14.4 million for the nine months ended September 30, 2014, compared to $11.1 million for the same period in 2013. With the increases in long-term market rates, which began in the summer of 2013, the opportunities to originate and sell long-term fixed-rate mortgages have waned and the anticipated impacts have been realized as we recognized lower net gains on sales of loans. Net gains on sales of loans decreased $1.6 million, or 80.03%, to $411 thousand for the nine months ended September 30, 2014, compared $2.1 million for the same period in 2013. This is primarily driven by a change in volume from $80.7 million of loans sold in the nine months ended September 30, 2013, compared to $26.5 million for the same period in 2014, a decrease of $54.2 million, or 67.16%. Gains on sales of securities, net, decreased $25 thousand, or 3.20%, to $756 thousand for the nine month period ended September 30, 2014, compared to $781 thou sand for the same period in 2014.
Included in noninterest income is $6.2 million from trust and investment management fees representing revenue from our subsidiary, Charter Trust Company. This represents an increase of $5.2 million over our realized income of $294 thousand from our 50% ownership of Charter Trust Company and fee income of $679 thousand for the nine month period ended September 30, 2013. We completed the acquisition of Charter Holding Corp., the holding company of Charter Trust Company, in September 2013. Additionally, in September 2013 as part of the purchase accounting related to the acquisition, we recognized a remeasurement gain of equity interest in Charter Holding Corp. of $1.4 million.
Noninterest expense increased $9.0 million, or 34.77%, to $34.8 million for the nine months ended September 30, 2014, compared to $25.8 million for the same period in 2013. Within noninterest expense, salaries and employee benefits increased $5.4 million, or 41.55%, to $18.4 million for the nine months ended September 30, 2014, compared to $13.0 million for the same period in 2013. This increase includes expenses related to additional staff and operations for Charter Trust Company and Randolph National Bank and its eight branches, which represent approximately 66% of the increase in salaries and employees benefits. Occupancy expense increased $1.0 million, or 33.21%, to $4.3 million for the nine month period ended September 30, 2014, compared to $3.2 million for the same period in 2013. The occupancy expenses from Charter Holding Corp. and the former Randolph National Bank branches represent $213 thousand and $497 thousand, respectively, of the increase. Depositors' insurance increased $199 thousand, or 34.67%, due to the growth in deposits comparing the nine month period ended September 30, 2014 to the same period in 2013. The increase of $935 thousand in outside services for the nine months ended September 30, 2014, compared to the same period in 2013, includes increases of $569 thousand related to Charter Trust Company operations, $131 thousand related to our core processing provider and $39 thousand related to account statement rendering. We did not record merger-related expenses during the nine month period ended September 30, 2014, compared to $801 thousand recorded during the same period in 2013. Amortization of intangible assets increased $693 thousand, or 117.06%, to $1.3 million for the nine months ended September 30, 2014, compared to $592 thousand for the same period in 2013 due to the additional core deposit intangible from the acquisition of Randolph National Bank and the customer list intangible from the acquisition of Charter Hol ding Corp. Other expenses increased $708 thousand to $4.5 million for the nine months ended September 30, 2014, including an increase of $493 thousand from Charter Trust Company operations and an increase of $146 thousand in contributions, which includes an increase of $120 thousand in tax-qualified contributions.
Earnings Summary for the Three Months Ended September 30, 2014
Net income for the three months ended September 30, 2014 was $2.7 million, an increase of 5.14%, compared to $2.6 million for the same period in 2013. Net interest and dividend income increased $2.6 million, or 31.67%, for the three months ended September 30, 2014, compared to the same period in 2013. This increase represents the combined impact of our acquisition of Randolph National Bank and our originated loan portfolio growth, as well as the additional benefits of our improving spreads and our cost of funds management.
The provision for loan losses decreased $91 thousand to $27 thousand which was based on adequacy calculations for the three months ended September 30, 2014, compared to $118 thousand for the same period in 2013.
Noninterest income increased $305 thousand, or 6.68%, to $4.9 million for the three months ended September 30, 2014, compared to $4.6 million for the same period in 2013. Net gains on sales of loans decreased $209 million, or 46.44%, to $241 thousand for the three months ended September 30, 2014, compared $450 thousand for the same period in 2013. This is primarily driven by a change in volume and valuations on $16.8 million of loans sold in the three months ended September 30, 2013, compared to $13.8 million for the same period in 2014, a decrease of $3.0 million, or 17.86%. Gains on sales of securities, net, increased $313 thousand to $313 thousand for the three month period ended September 30, 2014, compared to no gains recorded for the same period in 2013.
Income related to Charter Trust Company increased $1.3 million for the three month period ended September 30, 2013, compared to the same period in 2013. This includes an increase of $1.4 million of trust fees and a decrease of $53 thousand of realized income from our 50% ownership of Charter Trust Company. Additionally, in September 2013 as part of the acquisition accounting related to the acquisition of Charter Holding Corp., we recognized a remeasurement gain of equity interest in Charter Holding Corp. of $1.4 million.
Noninterest expense increased $2.0 million, or 20.23%, to $11.5 million for the three months ended September 30, 2014, compared to $9.5 million for the same period in 2013. Within noninterest expense, salaries and employee benefits increased $1.7 million, or 37.02%, to $6.3 million for the three months ended September 30, 2014, compared to $4.6 million for the same period in 2013. This increase includes expenses related to additional staff and operations for Charter Trust Company and Randolph National Bank and its eight branches, which represent approximately 79% of the increase in salaries and employees benefits. Occupancy expense increased $211 thousand, or 19.76%, to $1.3 million for the three month period ended September 30, 2014, compared to $1.1 million for the same period in 2013. The occupancy expenses from Charter Holding Corp. and the former Randolph National Bank branches represent $62 thousand and $237 thousand, respectively, of the increase. Depositors' insurance increased $37 thousand, or 18.97%, for the three month period ended September 30, 2014 compared to the same period in 2013. The increase of $242 thousand in outside services for the three months ended September 30, 2014, compared to the same period in 2013, includes an increase of $120 thousand related to Charter Trust Company operations and an increase of $49 thousand related to our core processing provider. We did not record merger-related expenses during the three month period ended September 30, 2014, compared to $801 thousand recorded during the same period in 2013. Amortization of intangible assets increased $204 thousand, or 96.23%, to $416 thousand for the three months ended September 30, 2014, compared to $212 thousand for the same period in 2013 due to the additional core deposit intangible from the acquisition of Randolph National Bank and the customer list intangible from the acquisition of Charter Holding Corp. Other expenses increased $120 thousand to $1.4 mil lion for the three months ended September 30, 2014, including an increase of $117 thousand from Charter Trust Company operations.
Balance Sheet Summary as of September 30, 2014
Total assets were $1.5 billion at September 30, 2014, compared to $1.4 billion at December 31, 2013, an increase of $59.2 million, or 4.16%. Securities available-for-sale decreased $19.1 million to $106.2 million at September 30, 2014, from $125.2 million at December 31, 2013. Net loans held in portfolio increased $70.1 million, or 6.18%, to $1.2 billion at September 30, 2014, from $1.1 billion at December 31, 2013. Conventional real estate loans increased $41.8 million and commercial real estate loans increased $25.7 million, representing 59.63% and 36.66%, respectively, of the net loan growth. The allowance for loan losses was $9.5 million at September 30, 2014, compared to $9.8 million at December 31, 2013. The change of $210 thousand in the allowance for loan losses is the net effect of provisions of $736 thousand, charge-offs of $1.3 million and recoveries of $351 thousand in addition to net charge-offs of $39 thousand to the reserve for the overdraft protection program. Additionally, the Bank had a credit mark of $5.7 million at September 30, 2014, related to acquired loan balances of $163.3 million. During the nine months ended September 30, 2014, we originated $284.9 million in loans, a decrease of 3.31%, compared to $294.7 million during the same period in 2013. During the quarter ended September 30, 2014, we originated $95.3 million in loans, a decrease of 18.71%, compared to $117.2 million during the same period in 2013.
Goodwill increased $208 thousand, or 0.47%, to $44.8 million at September 30, 2014, from $44.6 million at December 31, 2013. Intangible assets decreased $1.3 million, or 11.66%, to $9.7 million at September 30, 2014, compared to $11.0 million at December 31, 2013. This reflects ordinary amortizations of intangible assets of $1.3 million during the nine months ended September 30, 2014.
Total deposits increased $23.0 million, or 2.12%, to $1.1 billion at September 30, 2014, from $1.1 billion at December 31, 2013, including an increase of $30.2 million in brokered deposits used in conjunction with additional Federal Home Loan Bank (FHLB) advances to fund loan growth. Advances from the Federal Home Loan Bank increased $39.3 million, or 32.25%, to $161.0 million at September 30, 2014, from $121.7 million at December 31, 2013. Securities sold under agreements to repurchase decreased $11.0 million, or 39.57%, to $16.9 million at September 30, 2014 from $27.9 million at December 31, 2013.
Stockholders' equity of $153.9 million resulted in a book value of $15.88 per common share at September 30, 2014 based on 8,244,065 shares of common stock outstanding. The Bank remains well capitalized with a Leverage Capital ratio of 8.28% at September 30, 2014.
Branch Consolidation
On September 30, 2014, we consolidated our two offices in Rutland, Vermont, into one location.
Quarterly Dividend
On October 9, 2014, we declared a regular quarterly cash dividend of $0.13 per share payableOctober 31, 2014to stockholders of record as ofOctober 24, 2014.
About New Hampshire Thrift Bancshares, Inc.
New Hampshire Thrift Bancshares, Inc. is the holding company of Lake Sunapee Bank, fsb, a federally chartered savings bank that provides a wide range of life-cycle banking and financial services. Lake Sunapee Bank has four wholly owned subsidiaries: Lake Sunapee Financial Services Corp.; Lake Sunapee Group, Inc., which owns and maintains all buildings and investment properties; McCrillis & Eldredge Insurance, Inc., a full-line independent insurance agency; and Charter Holding Corp., which wholly owns Charter Trust Company, a trust services and wealth management company. New Hampshire Thrift Bancshares, Inc., through its direct and indirect subsidiaries, operates 30 offices in New Hampshire in Grafton, Hillsborough, Merrimack and Sullivan counties and 16 offices in Vermont in Orange, Rutland and Windsor counties.
New Hampshire Thrift Bancshares, Inc.
Selected Financial Highlights
Three Months Nine Months
Ended September 30, Ended September 30,
(Dollars in thousands except for
per share data) 2014 2013 2014 2013
---------- ---------- ---------- ----------
Net Income $ 2,704 $ 2,572 $ 7,189 $ 6,419
Per Common Share Data:
Basic Earnings 0.32 0.35 0.85 0.87
Diluted Earnings (1) 0.32 0.35 0.85 0.87
Dividends Paid 0.13 0.13 0.39 0.39
Dividend Payout Ratio 40.63% 37.14% 45.88% 44.83%
As of
(Dollars in thousands except for per share September 30, December 31,
data) 2014 2013
---------------- ----------------
Total Assets $ 1,483,112 $ 1,423,870
Total Securities (2) 116,918 134,998
Loans, Net 1,204,230 1,134,110
Total Deposits 1,111,111 1,088,092
Federal Home Loan Bank Advances 160,990 121,734
Stockholders' Equity 153,944 149,257
Book Value per Common Share $ 15.88 $ 15.37
Common Shares Outstanding 8,244,065 8,216,747
Leverage (Tier I) Capital 8.28% 8.29%
Number of Offices:
Banking Offices 36 37
Insurance Offices 3 3
Trust Offices 7 6
(1) Diluted earnings per share are calculated using the weighted-average
number of shares outstanding for the period, including common stock
equivalents, as appropriate.
(2) Includes available-for-sale securities shown at fair value and Federal
Home Loan Bank stock at cost.
New Hampshire Thrift Bancshares, Inc.
Consolidated Balance Sheets
September 30, December 31,
(Dollars in thousands) 2014 2013
----------------- -----------------
ASSETS (Unaudited)
Cash and due from banks $ 40,036 $ 12,005
Overnight deposits - 21,573
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Cash and cash equivalents 40,036 33,578
Interest-bearing time deposits with
other banks 747 1,743
Securities available-for-sale 106,156 125,238
Federal Home Loan Bank stock 10,762 9,760
Loans held-for-sale 2,405 680
Loans receivable, net of the alloance
for loan losses 1,204,230 1,134,110
Accrued interest receivable 3,167 2,628
Premises and equipment, net 24,476 23,842
Investments in real estate 3,570 3,681
Other real estate owned 137 1,343
Goodwill 44,840 44,632
Intangible assets 9,735 11,020
Bank owned life insurance 20,022 19,544
Other assets 12,829 12,071
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Total assets $ 1,483,112 $ 1,423,870
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LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES
Deposits:
Noninterest-bearing $ 106,065 $ 101,446
Interest-bearing 1,005,046 986,646
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Total deposits 1,111,111 1,088,092
Federal Home Loan Bank advances 160,990 121,734
Securities sold under agreements to
repurchase 16,850 27,885
Subordinated debentures 20,620 20,620
Accrued expenses and other liabilities 19,597 16,282
----------------- -----------------
Total liabilities 1,329,168 1,274,613
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STOCKHOLDERS' EQUITY
Preferred stock, $.01 par value per
share: 2,500,000 shares authorized,
non-cumulative perpetual Series B;
23,000 shares issued and
outstanding at September 30, 2014
and December 31, 2013; liquidation
value $1,000 per share - -
Common stock, $.01 par value per
share: 10,000,000 shares
authorized, 8,678,394 shares issued
and 8,244,065 shares outstanding at
September 30, 2014 and 8,651,076
shares issued and 8,216,747 shares
outstanding at December 31, 2013 87 87
Paid-in capital 101,356 100,961
Retained earnings 62,156 58,347
Unearned restricted stock awards (598) (490)
Accumulated other comprehensive loss (2,306) (2,897)
Treasury stock, 434,329 shares as of
September 30, 2014 and December 31,
2013, at cost (6,751) (6,751)
----------------- -----------------
Total stockholders' equity 153,944 149,257
----------------- -----------------
Total liabilities and
stockholders' equity $ 1,483,112 $ 1,423,870
================= =================
New Hampshire Thrift Bancshares, Inc.
Consolidated Statements of Income (unaudited)
Three Months Ended Nine Months Ended
September 30, September 30, September 30, September 30,
(Dollars in
thousands,
except for per
share data) 2014 2013 2014 2013
------------- ------------- ------------- -------------
Interest and
dividend income
Interest and
fees on loans $ 11,869 $ 9,071 $ 34,854 $ 27,276
Interest on
debt
investments:
Taxable 314 231 1,034 1,041
Dividends 41 16 122 39
Other 95 270 443 621
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Total
interest and
dividend
income 12,319 9,588 36,453 28,977
------------- ------------- ------------- -------------
Interest expense
Interest on
deposits 1,154 957 3,324 3,063
Interest on
advances and
other borrowed
money 535 558 1,583 1,875
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Total
interest
expense 1,689 1,515 4,907 4,938
------------- ------------- ------------- -------------
Net interest
and dividend
income 10,630 8,073 31,546 24,039
Provision for
loan losses 27 118 736 694
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Net interest
and dividend
income after
provision for
loan losses 10,603 7,955 30,810 23,345
============= ============= ============= =============
Noninterest
income
Customer
service fees 1,570 1,314 4,547 3,766
Gain on sales
of securities,
net 313 - 756 781
Net gain on
sales of loans 241 450 411 2,058
Net gain (loss)
on sales of
premises and
equipment - (18) 12 (14)
Net gain (loss)
on other real
estate and
property owned (1) - 194 25
Rental income 181 189 528 557
Bank owned life
insurance
income 151 154 453 430
Income from
equity
interest in
Charter
Holding Corp. - 53 - 294
Mortgage
servicing
income, net of
amortization
of mortgage
servicing
rights 16 22 149 23
Insurance and
brokerage
service income 359 351 1,161 1,170
Trust fees 2,038 679 6,190 679
Remeasurement
gain of equity
interest in
Charter
Holding Corp. - 1,369 - 1,369
------------- ------------- ------------- -------------
Total
noninterest
income 4,868 4,563 14,401 11,138
------------- ------------- ------------- -------------
Noninterest
expenses
Salaries and
employee
benefits 6,326 4,617 18,419 13,013
Occupancy
expenses 1,279 1,068 4,260 3,198
Advertising and
promotion 222 159 658 471
Depositors'
insurance 232 195 773 574
Outside
services 639 397 2,000 1,065
Professional
services 281 342 1,000 995
ATM processing
fees 230 153 650 466
Supplies 128 100 426 350
Telephone
expense 257 159 823 494
Merger-related
expenses - 801 - 801
Amortization of
intangible
assets 416 212 1,285 592
Other expenses 1,448 1,328 4,526 3,818
------------- ------------- ------------- -------------
Total
noninterest
expense 11,458 9,531 34,820 25,837
------------- ------------- ------------- -------------
Income before
provision for
income taxes 4,013 2,987 10,391 8,646
Provision for
income taxes 1,309 415 3,202 2,227
------------- ------------- ------------- -------------
Net income $ 2,704 $ 2,572 $ 7,189 $ 6,418
============= ============= ============= =============
Net income
available to
common
stockholders $ 2,646 $ 2,514 $ 7,017 $ 6,161
============= ============= ============= =============
Earnings per
common share,
basic $ 0.32 $ 0.35 $ 0.85 $ 0.87
============= ============= ============= =============
Average Number
of Shares,
basic 8,242,181 7,102,893 8,229,665 7,080,299
Earnings per
common share,
assuming
dilution $ 0.32 $ 0.35 $ 0.85 $ 0.87
============= ============= ============= =============
Average Number
of Shares,
assuming
dilution 8,255,350 7,113,611 8,237,850 7,084,795
Dividends
declared per
common share $ 0.13 $ 0.13 $ 0.39 $ 0.39
============= ============= ============= ============= NEWPORT, NH--(Marketwired - October 10, 2014) - New Hampshire Thrift Bancshares, Inc.