Attached files
| file | filename |
|---|---|
| 8-K - FIRST CONNECTICUT BANCORP, INC. 8-K 10 24 13 - First Connecticut Bancorp, Inc. | fcb8k-102413.htm |
Exhibit 99.1
First Connecticut Bancorp, Inc. Announces Third Quarter 2013 Results
FARMINGTON, Conn., October 24, 2013 – First Connecticut Bancorp, Inc. (the “Company”) (NASDAQ: FBNK), the holding company for Farmington Bank (the “Bank”), reported net income of $901,000 or $0.06 per diluted share for the quarter ended September 30, 2013 compared to a net loss of $1.1 million or ($0.07) per diluted share for the quarter ended September 30, 2012.
“Our Company remains focused on strategic organic growth as evidenced by a $124 million increase in net loans and a $98 million increase in deposits for the third quarter. While margins remain compressed, we are encouraged by the ongoing increase in net interest income and declining operating expenses. As a result of our growth, tangible book value increased $0.39 per share year over year” stated John J. Patrick Jr., First Connecticut Bancorp’s Chairman, President & CEO.
“During the quarter we opened our 21st branch office in East Hartford, CT and have recently applied for regulatory approval to open our 22nd branch office in Rocky Hill, CT in the first quarter 2014.”
Financial Highlights
|
·
|
Strong organic loan originations totaled approximately $199.0 million during the quarter resulting in a $124.4 million increase in total net loans. Loan growth was primarily driven by increases in Commercial Real Estate totaling $52.6 million and $49.5 million in Residential Real Estate.
|
|
·
|
Net interest income increased $396,000 to $13.3 million in the third quarter of 2013 compared to $12.9 million in the linked quarter.
|
|
·
|
Net gain on residential loans sold was $625,000 for the third quarter of 2013 based on $22.9 million in loans sold compared to a net gain of $1.6 million on $62.7 million in loans sold during the linked quarter.
|
|
·
|
Noninterest expense decreased $445,000 in the third quarter of 2013 compared to the linked quarter.
|
|
·
|
Overall deposits increased $98.3 million or 7% in the third quarter of 2013 compared to the linked quarter.
|
|
·
|
Checking accounts grew by 2.9% or 1,102 net new accounts in the third quarter of 2013.
|
|
·
|
Asset quality continued to improve as non-accrual loans represented 0.80% of total loans compared to 0.89% of total loans on a linked quarter basis. Net charge-offs totaled $42,000 for the quarter ended September 30, 2013 compared to $83,000 for the quarter ended June 30, 2013, a decrease of $41,000.
|
|
·
|
Tangible book value grew to $13.86 compared to $13.79 on a linked quarter basis and $13.47 at the quarter ended September 30, 2012.
|
|
·
|
During the third quarter of 2013, we repurchased 317,885 shares of common stock at an average price per share of $14.25 at a total cost of $4.5 million. Repurchased shares will be held as treasury stock and will be available for general corporate purposes.
|
|
·
|
We paid a cash dividend of $0.03 per share on September 16, 2013. This marks the eighth consecutive quarter we have paid a dividend since First Connecticut Bancorp, Inc. became a public company on June 29, 2011.
|
Third quarter 2013 compared with second quarter 2013
Net interest income
|
·
|
Net interest income increased $396,000 to $13.3 million in the third quarter of 2013 compared to the linked quarter due primarily to new loans originated during the second and third quarters.
|
|
·
|
Yield on average interest earning assets decreased 9 basis points from the linked quarter to 3.50% for the quarter ended September 30, 2013. Net interest margin decreased 7 basis points to 2.94% in the third quarter of 2013 compared to the linked quarter.
|
|
·
|
The cost of interest-bearing deposits remained relatively stable at 62 basis points compared to 63 basis points on a linked quarter basis.
|
Provision for loan losses
|
·
|
Provision for loan losses was $215,000 for the third quarter of 2013 compared to $256,000 for the linked quarter and net charge-offs in the quarter were $42,000 or 0.01% to average loans (annualized) compared to $83,000 or 0.02% to average loans (annualized) in the linked quarter.
|
Noninterest income
|
·
|
Total noninterest income decreased $739,000 to $2.2 million for the third quarter of 2013 compared to the linked quarter primarily due to a $964,000 decrease in net gain on loans sold and a decrease of $172,000 in other income offset by an increase in fees for customer services of $133,000 and an increase in gain on sale of an investment of $268,000 compared to the linked quarter.
|
Noninterest expense
|
·
|
Noninterest expense decreased $445,000 to $14.1 million in the third quarter of 2013 compared to the linked quarter as a result of decreases in marketing and other operating expenses.
|
|
·
|
Marketing expense decreased $187,000 or 31% compared to the linked quarter primarily due to general expense control initiatives.
|
|
·
|
Other operating expenses decreased $252,000 or 9%, primarily due to the recognition of an $84,000 loss on the sale of an OREO property and system conversion costs incurred in the linked quarter.
|
Third quarter 2013 compared with third quarter 2012
Net interest income
|
·
|
Net interest income decreased slightly to $13.3 million compared to $13.4 million in the third quarter of 2012.
|
|
·
|
Net interest margin decreased 34 basis points in the third quarter of 2013 compared to 3.28% in the third quarter of 2012 primarily due to a lower interest rate environment and a $39.9 million decline in the resort loan portfolio. Excluding resort income for both periods, the net interest margin decreased 25 basis points.
|
|
·
|
The cost of interest-bearing deposits declined slightly to 62 basis points compared to 64 basis points on a quarter over quarter basis.
|
Provision for loan losses
|
·
|
Provision for loan losses was $215,000 for both quarters.
|
|
·
|
Net charge-offs for the quarter were $42,000 or 0.01% to average loans (annualized) compared to $222,000 or 0.06% to average loans (annualized) in the third quarter of 2012.
|
Noninterest income
|
·
|
Total noninterest income increased $90,000 to $2.2 million compared to the third quarter of 2012 primarily due to increases in fees for customer service of $280,000 and gain on sale of investments of $304,000, partially offset with decreases in net gains on loans sold and other income of $62,000 and $412,000, respectively.
|
|
·
|
Other income decreased $412,000 primarily due to a decrease of $331,000 in mortgage banking derivatives and an increase of $95,000 in amortization of mortgage servicing rights.
|
Noninterest expense
|
·
|
Noninterest expense decreased $2.8 million to $14.1 million in the third quarter of 2013 compared to the third quarter of 2012 primarily due to recognizing $3.0 million in stock compensation expense during the third quarter of 2012 related to the implementation of the 2012 Stock Incentive Plan (the “Plan”).
|
|
·
|
Salaries and employee benefits, excluding stock compensation expense related to the Plan remained relatively flat between the two quarters.
|
|
·
|
Other operating expenses decreased $1.1 million compared to the third quarter of 2012 primarily due to both the initial vesting of directors’ stock compensation expense related to the Plan and a $394,000 loss on the sale of non-strategic properties in the third quarter of 2012.
|
Income tax provision
|
·
|
Income taxes increased $811,000 to a tax expense of $292,000 in the third quarter of 2013 compared to a tax benefit of $519,000 in the third quarter of 2012.
|
September 30, 2013 compared to June 30, 2013
Financial condition
|
·
|
Total assets increased $147.1 million or 8% at September 30, 2013 to $2.0 billion compared to June 30, 2013 largely reflecting an increase in loans.
|
|
·
|
Our investment portfolio totaled $123.4 million at September 30, 2013 compared to $115.8 million at June 30, 2013, an increase of $7.6 million.
|
|
·
|
Net loans increased $124.4 million at September 30, 2013 to $1.7 billion compared to June 30, 2013 due to our continued focus on commercial and residential lending which, combined, increased $128.1 million, offset by a $2.6 million decrease in resort loans as we continue our planned exit of the resort financing market.
|
|
·
|
Deposits increased $98.3 million at September 30, 2013 compared to June 30, 2013, due to an increase in municipal and customer deposits as we continue to develop and grow relationships in the geographical areas we serve.
|
|
·
|
Federal Home Loan Bank of Boston advances increased $52.8 million to $104.0 million, primarily due to an increase in overnight borrowings at September 30, 2013 compared to June 30, 2013.
|
|
·
|
Stockholders’ equity decreased $3.6 million to $227.5 million at September 30, 2013 compared to June 30, 2013 primarily due to the $4.5 million repurchase of 317,885 shares of common stock at an average stock price of $14.25.
|
Asset Quality
|
·
|
Non-accrual loans decreased $438,000 to $13.9 million or 0.80% of total loans at September 30, 2013 compared to $14.3 million or 0.89% of total loans at June 30, 2013.
|
|
·
|
At September 30, 2013, the allowance for loan losses represented 1.02% of total loans and 127.30% of non-accrual loans, compared to 1.09% of total loans and 122.20% of non-accrual loans at June 30, 2013.
|
|
·
|
Loan delinquencies 30 days and greater decreased slightly to 0.87% of total loans at September 30, 2013 compared to 0.95% of total loans at June 30, 2013.
|
Capital and Liquidity
|
·
|
The Company remained well-capitalized with an estimated total capital to risk-weighted asset ratio of 16.12% at September 30, 2013.
|
|
·
|
Tangible book value was $13.86 compared to $13.79 on a linked quarter basis and $13.47 from a year ago.
|
|
·
|
At September 30, 2013, the Company continued to have adequate liquidity including significant unused borrowing capacity at the Federal Home Loan Bank of Boston and the Federal Reserve Bank, as well as access to funding through brokered deposits.
|
About First Connecticut Bancorp, Inc.
First Connecticut Bancorp, Inc. (NASDAQ: FBNK) is a Maryland-chartered stock holding company that wholly owns Farmington Bank. Farmington Bank is a full-service, community bank with 21 branch locations throughout central Connecticut. Established in 1851, Farmington Bank is a diversified consumer and commercial bank with an ongoing commitment to contribute to the betterment of the communities in our region. For more information regarding the Bank’s products and services and for First Connecticut Bancorp, Inc. investor relations information, please visit www.farmingtonbankct.com.
Forward Looking Statements
In addition to historical information, this earnings release may contain forward-looking statements for purposes of applicable securities laws. Any statements contained herein that are not statements of historical fact may be deemed to be forward-looking statements. Such forward-looking statements may or may not include words such as “believe,” “expect,” “anticipate,” “estimate,” and “intend” or future or conditional verbs such as “will,” “would,” “should,” “could,” or “may.” Forward-looking statements are subject to numerous assumptions, risks and uncertainties. There are a number of important factors described in documents previously filed by the Company with the Securities and Exchange Commission, and other factors that could cause the Company's actual results to differ materially from those contemplated by such forward-looking statements. The Company undertakes no obligation to publicly release the results of any revisions to those forward-looking statements which may be made to reflect events or circumstances after the date of this release or to reflect the occurrence of unanticipated events.
Non-GAAP Financial Measures
In addition to results presented in accordance with GAAP, this press release contains certain non-GAAP financial measures. A reconciliation of net income and other performance ratios, as adjusted, is included in the accompanying reconciliation of Non-GAAP Measures table.
We believe that providing certain non-GAAP financial measures provides investors with information useful in understanding our financial performance, our performance trends and financial position. Specifically, we provide measures based on what we believe are our operating earnings on a consistent basis and exclude non-core operating items which affect the GAAP reporting of results of operations. We utilize these measures for internal planning and forecasting purposes. These non-GAAP measures should not be considered a substitute for GAAP basis measures and results, and we strongly encourage investors to review our consolidated financial statements in their entirety and not to rely on any single financial measure.
First Connecticut Bancorp, Inc.
Selected Financial Data (Unaudited)
|
At or for the Three Months Ended
|
||||||||||
|
September 30,
|
June 30,
|
March 31,
|
December 31,
|
September 30,
|
||||||
|
(Dollars in thousands, except per share data)
|
2013
|
2013
|
2013
|
2012
|
2012
|
|||||
|
Selected Financial Condition Data:
|
||||||||||
|
Total assets
|
$ 1,992,201
|
$ 1,845,116
|
$ 1,799,392
|
$ 1,822,946
|
$ 1,756,133
|
|||||
|
Cash and cash equivalents
|
50,323
|
36,650
|
34,946
|
50,641
|
33,021
|
|||||
|
Held to maturity securities
|
3,002
|
3,003
|
3,003
|
3,006
|
3,007
|
|||||
|
Available for sale securities
|
120,382
|
112,801
|
108,787
|
138,241
|
125,614
|
|||||
|
Federal Home Loan Bank of Boston stock, at cost
|
8,383
|
8,383
|
8,383
|
8,939
|
8,056
|
|||||
|
Loans receivable, net
|
1,712,507
|
1,588,080
|
1,544,687
|
1,520,170
|
1,485,275
|
|||||
|
Deposits
|
1,550,627
|
1,452,319
|
1,376,092
|
1,330,455
|
1,257,987
|
|||||
|
Federal Home Loan Bank of Boston advances
|
104,000
|
51,250
|
76,000
|
128,000
|
125,200
|
|||||
|
Total stockholders' equity
|
227,536
|
231,180
|
242,869
|
241,522
|
242,199
|
|||||
|
Allowance for loan losses
|
17,678
|
17,505
|
17,332
|
17,229
|
17,920
|
|||||
|
Non-accrual loans
|
13,887
|
14,325
|
13,911
|
13,782
|
13,240
|
|||||
|
Impaired loans
|
42,587
|
39,159
|
39,210
|
36,857
|
37,863
|
|||||
|
Selected Operating Data:
|
||||||||||
|
Interest income
|
$ 15,806
|
$ 15,336
|
$ 15,047
|
$ 16,507
|
$ 15,780
|
|||||
|
Interest expense
|
2,523
|
2,449
|
2,395
|
2,415
|
2,393
|
|||||
|
Net Interest Income
|
13,283
|
12,887
|
12,652
|
14,092
|
13,387
|
|||||
|
Provision for allowance for loan losses
|
215
|
256
|
399
|
315
|
215
|
|||||
|
Net interest income after provision for loan losses
|
13,068
|
12,631
|
12,253
|
13,777
|
13,172
|
|||||
|
Noninterest income
|
2,235
|
2,974
|
3,538
|
4,054
|
2,145
|
|||||
|
Noninterest expense
|
14,110
|
14,555
|
14,699
|
13,411
|
16,905
|
|||||
|
Income (loss) before income taxes
|
1,193
|
1,050
|
1,092
|
4,420
|
(1,588)
|
|||||
|
Provision (benefit) for income taxes
|
292
|
248
|
279
|
1,250
|
(519)
|
|||||
|
Net income (loss)
|
$ 901
|
$ 802
|
$ 813
|
$ 3,170
|
$ (1,069)
|
|||||
|
Performance Ratios (annualized):
|
||||||||||
|
Return on average assets
|
0.19%
|
0.17%
|
0.18%
|
0.77%
|
-0.25%
|
|||||
|
Return average equity
|
1.55%
|
1.36%
|
1.33%
|
5.62%
|
-1.74%
|
|||||
|
Interest rate spread (1)
|
2.77%
|
2.83%
|
2.89%
|
3.19%
|
3.09%
|
|||||
|
Net interest rate margin (2)
|
2.94%
|
3.01%
|
3.07%
|
3.37%
|
3.28%
|
|||||
|
Non-interest expense to average assets
|
2.95%
|
3.17%
|
3.28%
|
3.01%
|
3.89%
|
|||||
|
Efficiency ratio (3)
|
90.93%
|
91.77%
|
90.79%
|
73.91%
|
108.84%
|
|||||
|
Average interest-earning assets to average
|
||||||||||
|
interest-bearing liabilities
|
130.77%
|
132.30%
|
132.04%
|
131.80%
|
131.75%
|
|||||
|
Asset Quality Ratios:
|
||||||||||
|
Allowance for loan losses as a percent of total loans
|
1.02%
|
1.09%
|
1.11%
|
1.12%
|
1.19%
|
|||||
|
Allowance for loan losses as a percent of
|
||||||||||
|
non-accrual loans
|
127.30%
|
122.20%
|
124.59%
|
125.01%
|
135.35%
|
|||||
|
Net charge-offs to average loans (annualized)
|
0.01%
|
0.02%
|
0.08%
|
0.27%
|
0.06%
|
|||||
|
Non-accrual loans as a percent of total loans
|
0.80%
|
0.89%
|
0.89%
|
0.90%
|
0.88%
|
|||||
|
Non-accrual loans as a percent of total assets
|
0.70%
|
0.78%
|
0.77%
|
0.76%
|
0.75%
|
|||||
|
Per Share Related Data:
|
||||||||||
|
Basic earnings (loss) per share
|
$ 0.06
|
$ 0.05
|
$ 0.05
|
$ 0.19
|
$ (0.07)
|
|||||
|
Diluted earnings (loss) per share
|
$ 0.06
|
$ 0.05
|
$ 0.05
|
$ 0.19
|
$ (0.07)
|
|||||
|
Dividends declared per share
|
$ 0.03
|
$ 0.03
|
$ 0.03
|
$ 0.03
|
$ 0.03
|
|||||
|
Tangible book value
|
$ 13.86
|
$ 13.79
|
$ 13.76
|
$ 13.63
|
$ 13.47
|
|||||
|
Common stock shares outstanding
|
16,416,427
|
16,763,516
|
17,644,449
|
17,714,481
|
17,986,596
|
|||||
|
(1) Represents the difference between the weighted-average yield on average interest-earning assets and the weighted-average cost of interest-bearing liabilities.
|
||||||||||
|
(2) Represents net interest income as a percent of average interest-earning assets.
|
||||||||||
|
(3) Represents noninterest expense divided by the sum of net interest income and noninterest income.
|
||||||||||
First Connecticut Bancorp, Inc.
Selected Financial Data (Unaudited)
|
At or for the Three Months Ended
|
||||||||||
|
September 30,
|
June 30,
|
March 31,
|
December 31,
|
September 30,
|
||||||
|
(Dollars in thousands)
|
2013
|
2013
|
2013
|
2012
|
2012
|
|||||
|
Capital Ratios:
|
||||||||||
|
Equity to total assets at end of period
|
11.42%
|
12.53%
|
13.50%
|
13.25%
|
13.79%
|
|||||
|
Average equity to average assets
|
12.11%
|
12.83%
|
13.62%
|
13.68%
|
14.19%
|
|||||
|
Total capital to risk-weighted assets
|
16.12%
|
*
|
17.48%
|
18.61%
|
18.78%
|
19.15%
|
||||
|
Tier I capital to risk-weighted assets
|
14.96%
|
*
|
16.25%
|
17.37%
|
17.53%
|
17.90%
|
||||
|
Tier I capital to total average assets
|
12.19%
|
*
|
12.92%
|
13.84%
|
13.88%
|
14.24%
|
||||
|
Total equity to total average assets
|
11.88%
|
12.59%
|
13.56%
|
13.56%
|
13.95%
|
|||||
|
* Estimated
|
||||||||||
|
Loans and Allowance for Loan Losses:
|
||||||||||
|
Real estate
|
||||||||||
|
Residential
|
$ 674,804
|
$ 625,345
|
$ 619,741
|
$ 620,991
|
$ 605,794
|
|||||
|
Commercial
|
585,628
|
533,072
|
504,722
|
473,788
|
448,684
|
|||||
|
Construction
|
90,033
|
80,198
|
66,508
|
64,362
|
54,909
|
|||||
|
Installment
|
4,671
|
5,384
|
5,949
|
6,719
|
7,372
|
|||||
|
Commercial
|
213,103
|
199,328
|
200,610
|
192,210
|
196,813
|
|||||
|
Collateral
|
1,819
|
1,801
|
1,945
|
2,086
|
2,161
|
|||||
|
Home equity line of credit
|
147,026
|
144,548
|
143,992
|
142,543
|
134,314
|
|||||
|
Demand
|
-
|
-
|
-
|
25
|
25
|
|||||
|
Revolving credit
|
78
|
62
|
73
|
65
|
86
|
|||||
|
Resort
|
9,849
|
12,425
|
15,252
|
31,232
|
49,760
|
|||||
|
Total loans
|
1,727,011
|
1,602,163
|
1,558,792
|
1,534,021
|
1,499,918
|
|||||
|
Less:
|
||||||||||
|
Allowance for loan losses
|
(17,678)
|
(17,505)
|
(17,332)
|
(17,229)
|
(17,920)
|
|||||
|
Net deferred loan costs
|
3,174
|
3,422
|
3,227
|
3,378
|
3,277
|
|||||
|
Loans, net
|
$ 1,712,507
|
$ 1,588,080
|
$ 1,544,687
|
$ 1,520,170
|
$ 1,485,275
|
|||||
|
Deposits:
|
||||||||||
|
Noninterest-bearing demand deposits
|
$ 278,275
|
$ 275,781
|
$ 245,912
|
$ 247,586
|
$ 221,464
|
|||||
|
Interest-bearing
|
||||||||||
|
NOW accounts
|
339,350
|
280,462
|
234,450
|
227,205
|
220,490
|
|||||
|
Money market
|
386,682
|
349,621
|
352,759
|
317,030
|
285,540
|
|||||
|
Savings accounts
|
187,040
|
191,688
|
186,171
|
179,290
|
171,516
|
|||||
|
Time deposits
|
359,280
|
354,767
|
356,800
|
359,344
|
358,977
|
|||||
|
Total interest-bearing deposits
|
1,272,352
|
1,176,538
|
1,130,180
|
1,082,869
|
1,036,523
|
|||||
|
Total deposits
|
$ 1,550,627
|
$ 1,452,319
|
$ 1,376,092
|
$ 1,330,455
|
$ 1,257,987
|
|||||
First Connecticut Bancorp, Inc.
Consolidated Statements of Condition
|
September 30,
|
June 30,
|
December 31,
|
||||||||||
|
(Dollars in thousands)
|
2013
|
2013
|
2012
|
|||||||||
|
Assets
|
||||||||||||
|
Cash and cash equivalents
|
$ 50,323
|
$ 36,650
|
$ 50,641
|
|||||||||
|
Securities held-to-maturity, at amortized cost
|
3,002
|
3,003
|
3,006
|
|||||||||
|
Securities available-for-sale, at fair value
|
120,382
|
112,801
|
138,241
|
|||||||||
|
Loans held for sale
|
5,357
|
4,801
|
9,626
|
|||||||||
|
Loans, net
|
1,712,507
|
1,588,080
|
1,520,170
|
|||||||||
|
Premises and equipment, net
|
21,013
|
20,767
|
19,967
|
|||||||||
|
Federal Home Loan Bank of Boston stock, at cost
|
8,383
|
8,383
|
8,939
|
|||||||||
|
Accrued income receivable
|
4,579
|
4,403
|
4,415
|
|||||||||
|
Bank-owned life insurance
|
38,255
|
37,952
|
37,449
|
|||||||||
|
Deferred income taxes
|
16,095
|
15,918
|
15,682
|
|||||||||
|
Prepaid expenses and other assets
|
12,305
|
12,358
|
14,810
|
|||||||||
|
Total assets
|
$ 1,992,201
|
$ 1,845,116
|
$ 1,822,946
|
|||||||||
|
Liabilities and Stockholders' Equity
|
||||||||||||
|
Deposits
|
||||||||||||
|
Interest-bearing
|
$ 1,272,352
|
$ 1,176,538
|
$ 1,082,869
|
|||||||||
|
Noninterest-bearing
|
278,275
|
275,781
|
247,586
|
|||||||||
|
1,550,627
|
1,452,319
|
1,330,455
|
||||||||||
|
Federal Home Loan Bank of Boston advances
|
104,000
|
51,250
|
128,000
|
|||||||||
|
Repurchase agreement borrowings
|
21,000
|
21,000
|
21,000
|
|||||||||
|
Repurchase liabilities
|
50,432
|
50,262
|
54,187
|
|||||||||
|
Accrued expenses and other liabilities
|
38,606
|
39,105
|
47,782
|
|||||||||
|
Total liabilities
|
1,764,665
|
1,613,936
|
1,581,424
|
|||||||||
|
Commitments and contingencies
|
-
|
-
|
-
|
|||||||||
|
Stockholders' Equity
|
||||||||||||
|
Common stock
|
181
|
181
|
181
|
|||||||||
|
Additional paid-in-capital
|
174,817
|
174,342
|
172,247
|
|||||||||
|
Unallocated common stock held by ESOP
|
(14,014)
|
(14,281)
|
(14,806)
|
|||||||||
|
Treasury stock, at cost
|
(23,053)
|
(18,524)
|
(4,860)
|
|||||||||
|
Retained earnings
|
95,873
|
95,470
|
94,890
|
|||||||||
|
Accumulated other comprehensive loss
|
(6,268)
|
(6,008)
|
(6,130)
|
|||||||||
|
Total stockholders' equity
|
227,536
|
231,180
|
241,522
|
|||||||||
|
Total liabilities and stockholders' equity
|
$ 1,992,201
|
$ 1,845,116
|
$ 1,822,946
|
|||||||||
First Connecticut Bancorp, Inc.
Consolidated Statements of Income
|
Three Months Ended
|
Nine Months Ended
|
|||||||||||||||
|
September 30,
|
June 30,
|
September 30,
|
September 30,
|
|||||||||||||
|
(Dollars in thousands, except per share data)
|
2013
|
2013
|
2012
|
2013
|
2012
|
|||||||||||
|
Interest income
|
||||||||||||||||
|
Interest and fees on loans
|
||||||||||||||||
|
Mortgage
|
$ 12,381
|
$ 11,872
|
$ 11,460
|
$ 35,721
|
$ 33,452
|
|||||||||||
|
Other
|
3,199
|
3,233
|
3,927
|
9,746
|
11,675
|
|||||||||||
|
Interest and dividends on investments
|
||||||||||||||||
|
United States Government and agency obligations
|
103
|
102
|
234
|
344
|
749
|
|||||||||||
|
Other bonds
|
59
|
59
|
87
|
177
|
205
|
|||||||||||
|
Corporate stocks
|
62
|
64
|
69
|
188
|
209
|
|||||||||||
|
Other interest income
|
2
|
6
|
3
|
13
|
63
|
|||||||||||
|
Total interest income
|
15,806
|
15,336
|
15,780
|
46,189
|
46,353
|
|||||||||||
|
Interest expense
|
||||||||||||||||
|
Deposits
|
1,914
|
1,827
|
1,644
|
5,446
|
5,042
|
|||||||||||
|
Interest on borrowed funds
|
383
|
401
|
499
|
1,253
|
1,442
|
|||||||||||
|
Interest on repo borrowings
|
181
|
180
|
179
|
532
|
540
|
|||||||||||
|
Interest on repurchase liabilities
|
45
|
41
|
71
|
136
|
189
|
|||||||||||
|
Total interest expense
|
2,523
|
2,449
|
2,393
|
7,367
|
7,213
|
|||||||||||
|
Net interest income
|
13,283
|
12,887
|
13,387
|
38,822
|
39,140
|
|||||||||||
|
Provision for allowance for loan losses
|
215
|
256
|
215
|
870
|
1,065
|
|||||||||||
|
Net interest income
|
||||||||||||||||
|
after provision for loan losses
|
13,068
|
12,631
|
13,172
|
37,952
|
38,075
|
|||||||||||
|
Noninterest income
|
||||||||||||||||
|
Fees for customer services
|
1,230
|
1,097
|
950
|
3,309
|
2,666
|
|||||||||||
|
Net gain on sales of investments
|
304
|
36
|
-
|
340
|
-
|
|||||||||||
|
Net gain on loans sold
|
625
|
1,589
|
687
|
4,244
|
1,216
|
|||||||||||
|
Brokerage and insurance fee income
|
37
|
41
|
34
|
110
|
91
|
|||||||||||
|
Bank owned life insurance income
|
303
|
303
|
326
|
1,015
|
966
|
|||||||||||
|
Other
|
(264)
|
(92)
|
148
|
(271)
|
497
|
|||||||||||
|
Total noninterest income
|
2,235
|
2,974
|
2,145
|
8,747
|
5,436
|
|||||||||||
|
Noninterest expense
|
||||||||||||||||
|
Salaries and employee benefits
|
8,571
|
8,555
|
10,243
|
26,160
|
25,286
|
|||||||||||
|
Occupancy expense
|
1,175
|
1,126
|
1,108
|
3,541
|
3,396
|
|||||||||||
|
Furniture and equipment expense
|
998
|
1,099
|
1,120
|
3,115
|
3,331
|
|||||||||||
|
FDIC assessment
|
341
|
311
|
255
|
943
|
828
|
|||||||||||
|
Marketing
|
423
|
610
|
509
|
1,627
|
1,868
|
|||||||||||
|
Other operating expenses
|
2,602
|
2,854
|
3,670
|
7,978
|
7,958
|
|||||||||||
|
Total noninterest expense
|
14,110
|
14,555
|
16,905
|
43,364
|
42,667
|
|||||||||||
|
Income before income taxes
|
1,193
|
1,050
|
(1,588)
|
3,335
|
844
|
|||||||||||
|
Provision for income taxes
|
292
|
248
|
(519)
|
819
|
91
|
|||||||||||
|
Net income
|
$ 901
|
$ 802
|
$ (1,069)
|
$ 2,516
|
$ 753
|
|||||||||||
|
Earnings per share:
|
||||||||||||||||
|
Basic and Diluted
|
$ 0.06
|
$ 0.05
|
$ (0.07)
|
$ 0.16
|
$ 0.05
|
|||||||||||
|
Weighted average shares outstanding:
|
||||||||||||||||
|
Basic and Diluted
|
15,445,082
|
15,774,385
|
16,471,023
|
15,894,357
|
16,647,253
|
|||||||||||
First Connecticut Bancorp, Inc.
Consolidated Average Balances, Yields and Rates (Unaudited)
|
For The Three Months Ended
|
|||||||||||
|
September 30, 2013
|
June 30, 2013
|
September 30, 2012
|
|||||||||
|
Average
Balance
|
Interest
and
Dividends
|
Yield/
Cost
|
|
Average
Balance
|
Interest
and
Dividends
|
Yield/
Cost
|
|
Average
Balance
|
Interest
and
Dividends
|
Yield/
Cost
|
|
|
(Dollars in thousands)
|
|||||||||||
|
Interest-earning assets:
|
|||||||||||
|
Loans, net
|
$ 1,648,948
|
$ 15,580
|
3.75%
|
$ 1,577,559
|
$ 15,105
|
3.84%
|
$1,460,686
|
$ 15,387
|
4.18%
|
||
|
Securities
|
131,602
|
216
|
0.65%
|
115,280
|
216
|
0.75%
|
141,367
|
380
|
1.07%
|
||
|
Federal Home Loan Bank of Boston stock
|
8,383
|
8
|
0.38%
|
8,383
|
9
|
0.43%
|
7,671
|
10
|
0.52%
|
||
|
Federal funds and other earning assets
|
3,288
|
2
|
0.24%
|
14,317
|
6
|
0.17%
|
10,317
|
3
|
0.12%
|
||
|
Total interest-earning assets
|
1,792,221
|
15,806
|
3.50%
|
1,715,539
|
15,336
|
3.59%
|
1,620,041
|
15,780
|
3.86%
|
||
|
Noninterest-earning assets
|
122,566
|
120,622
|
116,100
|
||||||||
|
Total assets
|
$ 1,914,787
|
$ 1,836,161
|
$1,736,141
|
||||||||
|
Interest-bearing liabilities:
|
|||||||||||
|
NOW accounts
|
$ 303,882
|
$ 180
|
0.24%
|
$ 266,905
|
$ 151
|
0.23%
|
$ 207,763
|
$ 100
|
0.19%
|
||
|
Money market
|
371,614
|
794
|
0.85%
|
354,914
|
725
|
0.82%
|
280,572
|
498
|
0.70%
|
||
|
Savings accounts
|
185,732
|
79
|
0.17%
|
184,307
|
73
|
0.16%
|
172,494
|
67
|
0.15%
|
||
|
Certificates of deposit
|
356,994
|
861
|
0.96%
|
354,381
|
878
|
0.99%
|
361,648
|
979
|
1.07%
|
||
|
Total interest-bearing deposits
|
1,218,222
|
1,914
|
0.62%
|
1,160,507
|
1,827
|
0.63%
|
1,022,477
|
1,644
|
0.64%
|
||
|
Advances from the Federal Home Loan Bank
|
74,101
|
383
|
2.05%
|
68,660
|
401
|
2.34%
|
112,850
|
499
|
1.75%
|
||
|
Repurchase agreement borrowings
|
21,000
|
181
|
3.42%
|
21,000
|
180
|
3.44%
|
21,000
|
179
|
3.38%
|
||
|
Repurchase liabilities
|
57,187
|
45
|
0.31%
|
46,539
|
41
|
0.35%
|
73,268
|
71
|
0.38%
|
||
|
Total interest-bearing liabilities
|
1,370,510
|
2,523
|
0.73%
|
1,296,706
|
2,449
|
0.76%
|
1,229,595
|
2,393
|
0.77%
|
||
|
Noninterest-bearing deposits
|
272,621
|
257,670
|
216,205
|
||||||||
|
Other noninterest-bearing liabilities
|
39,810
|
46,291
|
43,965
|
||||||||
|
Total liabilities
|
1,682,941
|
1,600,667
|
1,489,765
|
||||||||
|
Stockholders' equity
|
231,846
|
235,494
|
246,376
|
||||||||
|
Total liabilities and stockholders' equity
|
$ 1,914,787
|
$ 1,836,161
|
$1,736,141
|
||||||||
|
Net interest income
|
$ 13,283
|
$ 12,887
|
$ 13,387
|
||||||||
|
Net interest rate spread (1)
|
2.77%
|
2.83%
|
3.09%
|
||||||||
|
Net interest-earning assets (2)
|
$ 421,711
|
$ 418,833
|
$ 390,446
|
||||||||
|
Net interest margin (3)
|
2.94%
|
3.01%
|
3.28%
|
||||||||
|
Average interest-earning assets
|
|||||||||||
|
to average interest-bearing liabilities
|
130.77%
|
132.30%
|
131.75%
|
||||||||
|
(1) Net interest rate spread represents the difference between the yield on average interest-earning assets and the cost of average interest-bearing liabilities.
|
|||||||||||
|
(2) Net interest-earning assets represent total interest-earning assets less total interest-bearing liabilities.
|
|||||||||||
|
(3) Net interest margin represents net interest income divided by average total interest-earning assets.
|
|||||||||||
First Connecticut Bancorp, Inc.
Consolidated Average Balances, Yields and Rates (Unaudited)
|
For The Nine Months Ended September 30,
|
|||||||
|
2013
|
2012
|
||||||
|
Average Balance
|
Interest and Dividends
|
Yield/Cost
|
Average Balance
|
Interest and Dividends
|
Yield/Cost
|
||
|
(Dollars in thousands)
|
|||||||
|
Interest-earning assets:
|
|||||||
|
Loans, net
|
$ 1,583,569
|
$ 45,467
|
3.84%
|
$ 1,379,256
|
$ 45,127
|
4.36%
|
|
|
Securities
|
124,507
|
684
|
0.73%
|
134,943
|
1,135
|
1.12%
|
|
|
Federal Home Loan Bank of Boston stock
|
8,524
|
25
|
0.39%
|
7,393
|
28
|
0.50%
|
|
|
Federal funds and other earning assets
|
9,513
|
13
|
0.18%
|
41,579
|
63
|
0.20%
|
|
|
Total interest-earning assets
|
1,726,113
|
46,189
|
3.58%
|
1,563,171
|
46,353
|
3.95%
|
|
|
Noninterest-earning assets
|
121,440
|
116,811
|
|||||
|
Total assets
|
$ 1,847,553
|
$ 1,679,982
|
|||||
|
Interest-bearing liabilities:
|
|||||||
|
NOW accounts
|
$ 268,482
|
$ 466
|
0.23%
|
$ 205,776
|
$ 272
|
0.18%
|
|
|
Money market
|
354,291
|
2,105
|
0.79%
|
271,051
|
1,530
|
0.75%
|
|
|
Savings accounts
|
180,490
|
237
|
0.18%
|
169,491
|
192
|
0.15%
|
|
|
Certificates of deposit
|
355,934
|
2,638
|
0.99%
|
370,514
|
3,048
|
1.10%
|
|
|
Total interest-bearing deposits
|
1,159,197
|
5,446
|
0.63%
|
1,016,832
|
5,042
|
0.66%
|
|
|
Federal Home Loan Bank of Boston advances
|
74,386
|
1,253
|
2.25%
|
79,708
|
1,442
|
2.41%
|
|
|
Repurchase agreement borrowings
|
21,000
|
532
|
3.39%
|
21,000
|
540
|
3.43%
|
|
|
Repurchase liabilities
|
53,106
|
136
|
0.34%
|
64,864
|
189
|
0.39%
|
|
|
Total interest-bearing liabilities
|
1,307,689
|
7,367
|
0.75%
|
1,182,404
|
7,213
|
0.81%
|
|
|
Noninterest-bearing deposits
|
256,830
|
207,456
|
|||||
|
Other noninterest-bearing liabilities
|
45,931
|
40,404
|
|||||
|
Total liabilities
|
1,610,450
|
1,430,264
|
|||||
|
Stockholders' equity
|
237,103
|
249,718
|
|||||
|
Total liabilities and stockholders' equity
|
$ 1,847,553
|
$ 1,679,982
|
|||||
|
Net interest income
|
$ 38,822
|
$ 39,140
|
|||||
|
Net interest rate spread (1)
|
2.83%
|
3.14%
|
|||||
|
Net interest-earning assets (2)
|
$ 418,424
|
$ 380,767
|
|||||
|
Net interest margin (3)
|
3.01%
|
3.34%
|
|||||
|
Average interest-earning assets to average
interest-bearing liabilities
|
|||||||
|
132.00%
|
132.20%
|
||||||
|
(1) Net interest rate spread represents the difference between the yield on average interest-earning assets and the cost of average interest-bearing liabilities.
|
|||||||
|
(2) Net interest-earning assets represent total interest-earning assets less total interest-bearing liabilities.
|
|||||||
|
(3) Net interest margin represents net interest income divided by average total interest-earning assets.
|
|||||||
First Connecticut Bancorp, Inc.
Reconciliation of Non-GAAP Financial Measures (Unaudited)
|
At or for the Three Months Ended
|
|||||||||||
|
September 30,
|
June 30,
|
March 31,
|
December 31,
|
September 30,
|
|||||||
|
(Dollars in thousands, except per share data)
|
2013
|
2013
|
2013
|
2012
|
2012
|
||||||
|
Net Income (loss)
|
$ 901
|
$ 802
|
$ 813
|
$ 3,170
|
$ (1,069)
|
||||||
|
Adjustments:
|
|||||||||||
|
Less: Prepayment penalty fees
|
-
|
(20)
|
(127)
|
(771)
|
(11)
|
||||||
|
Less: Bank-owned life insurance proceeds
|
-
|
-
|
(108)
|
(249)
|
-
|
||||||
|
Less: Pension prior service cost (1)
|
-
|
-
|
-
|
(1,208)
|
-
|
||||||
|
Less: Post retirement service cost (1)
|
-
|
-
|
-
|
(279)
|
-
|
||||||
|
Plus: Accelerated vesting of stock compensation (2)
|
-
|
-
|
633
|
-
|
3,047
|
||||||
|
Total core adjustments before taxes
|
-
|
(20)
|
398
|
(2,507)
|
3,036
|
||||||
|
Tax benefit (provision) - 34% rate
|
-
|
7
|
(135)
|
852
|
(1,032)
|
||||||
|
Total core adjustments after taxes
|
-
|
(13)
|
263
|
(1,655)
|
2,004
|
||||||
|
Total core net income (loss)
|
$ 901
|
$ 789
|
$ 1,076
|
$ 1,515
|
$ 935
|
||||||
|
Total net interest income
|
$ 13,283
|
$ 12,887
|
$ 12,652
|
$ 14,092
|
$ 13,387
|
||||||
|
Less: Prepayment penalty fees
|
-
|
(20)
|
(127)
|
(771)
|
(11)
|
||||||
|
Total core net interest income
|
$ 13,283
|
$ 12,867
|
$ 12,525
|
$ 13,321
|
$ 13,376
|
||||||
|
Total noninterest income
|
$ 2,235
|
$ 2,974
|
$ 3,538
|
$ 4,054
|
$ 2,145
|
||||||
|
Less: Bank-owned life insurance proceeds
|
-
|
-
|
(108)
|
(249)
|
-
|
||||||
|
Total core noninterest income
|
$ 2,235
|
$ 2,974
|
$ 3,430
|
$ 3,805
|
$ 2,145
|
||||||
|
Total noninterest expense
|
$ 14,110
|
$ 14,555
|
$ 14,699
|
$ 13,411
|
$ 16,905
|
||||||
|
Plus: Pension prior service cost (1)
|
-
|
-
|
-
|
1,208
|
-
|
||||||
|
Plus: Post retirement service cost (1)
|
-
|
-
|
-
|
279
|
-
|
||||||
|
Plus: Loss on sale of non-strategic properties
|
-
|
-
|
-
|
-
|
394
|
||||||
|
Less: Accelerated vesting of stock compensation (2)
|
-
|
-
|
(633)
|
-
|
(3,047)
|
||||||
|
Total core noninterest expense
|
$ 14,110
|
$ 14,555
|
$ 14,066
|
$ 14,898
|
$ 14,252
|
||||||
|
Core earnings per common share, diluted
|
$ 0.06
|
$ 0.05
|
$ 0.07
|
$ 0.09
|
$ 0.06
|
||||||
|
Core return on assets (annualized)
|
0.19%
|
0.17%
|
0.24%
|
0.34%
|
0.22%
|
||||||
|
Core return on equity (annualized)
|
1.55%
|
1.34%
|
1.76%
|
2.45%
|
1.52%
|
||||||
|
Efficiency ratio (3)
|
90.93%
|
91.88%
|
88.16%
|
86.99%
|
91.82%
|
||||||
|
(1) Represents recognizing the unrecognized prior service cost as a result of the freeze of the Company's non-contributory defined benefit and other post-retirement plans.
|
|||||||||||
|
(2) Represents the passing of a key executive in the first quarter of 2013 and 20% vesting of the 2012 Stock Incentive Plan in the third quarter of 2012.
|
|||||||||||
|
(3) Represents core noninterest expense divided by the sum of core net interest income and core noninterest income.
|
|||||||||||