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BANKWELL FINANCIAL GROUP REPORTS RECORD THIRD QUARTER NET INCOME OF $3.1 MILLION OR $0.41 PER SHARE AND DECLARES A 40% INCREASE TO THE QUARTERLY DIVIDEND

New Canaan, CT – October 26, 2016 – Bankwell Financial Group, Inc. (NASDAQ: BWFG) reported GAAP net income of $3.1 million or $0.41 per share for the third quarter of 2016, versus $2.3 million or $0.31 per share for the same period last year.

The Company's Board of Directors declared a $0.07 per share cash dividend, payable November 28, 2016 to shareholders of record on November 18, 2016, representing a 40% increase when compared to the last quarter.

Third Quarter 2016 Highlights:

Notes Bankwell Financial Group President and CEO, Christopher R. Gruseke:

"Bankwell has delivered another record quarter. We continue to experience strong organic growth; our loan portfolio increased at an annualized rate of 15% during the third quarter. Our balance sheet, meanwhile, remains unblemished with non-performing assets as a percentage of total assets of only 0.25%. We continue to extract operational efficiencies wherever we can and have improved our efficiency ratio to an outstanding 55.7% for the quarter."

"Finally, I am pleased to announce that, as a result of our continued strong financial performance, and as part of our commitment to deliver returns for our shareholders, we are increasing our quarterly dividend by 40%."

Earnings

Net income for the quarter ended September 30, 2016 was $3.1 million, an increase of 39% compared to the quarter ended September 30, 2015. Net income for the nine months ended September 30, 2016 was $9.0 million, an increase of 41% compared to the nine months ended September 30, 2015. Revenues (net interest income plus non-interest income) for the quarter ended September 30, 2016 were $13.3 million, an increase of 10% compared to the quarter ended September 30, 2015. Revenues for the nine months ended September 30, 2016 were $38.1 million, an increase of 11% compared to the nine months ended September 30, 2015. Net interest income for the quarter ended September 30, 2016 was $12.5 million, an increase of 15% compared to the quarter ended September 30, 2015. Our strong net income, revenues and net interest income growth were fueled by continued earning asset growth.

Basic and diluted earnings per share for the quarter ended September 30, 2016 was $0.42 and $0.41, respectively, compared to $0.31 for the quarter ended September 30, 2015.

The Company continues to focus on expense control as indicated by our improving efficiency ratio. The Company's efficiency ratio for the quarters ended September 30, 2016 and September 30, 2015 were 55.7% and 57.9%, respectively. The Company's efficiency ratio for the nine months ended September 30, 2016 and September 30, 2015 were 56.8% and 62.2%, respectively.

Noninterest Income and Expense

Noninterest income decreased $461 thousand or 38% to $0.8 million for the three months ended September 30, 2016 compared to the three months ended September 30, 2015 and decreased $369 thousand or 14% to $2.3 million for the nine months ended September 30, 2016 compared to the nine months ended September 30, 2015. The decrease in noninterest income was primarily driven by a reduction in the gains and fees from the sales of loans for the three and nine months ended September 30, 2016 when compared to the prior periods.

Noninterest expense increased $323 thousand or 5% for the three months ended September 30, 2016 compared to the three months ended September 30, 2015. The increase was primarily driven by an increase in professional services and salaries and employee benefits. Salaries and employee benefits increased $111 thousand or 3% for the three months ended September 30, 2016 compared to the three months ended September 30, 2015 as a result of an increase in full time equivalent employees. Professional services increased $182 thousand or 54% for the three months ended September 30, 2016 compared to the three months ended September 30, 2015 as a result of an increase in fees paid in relation to strategic initiatives.

Noninterest expense increased $286 thousand or 1% for the nine months ended September 30, 2016 compared to the nine months ended September 30, 2015. The increase was primarily driven by an increase in professional services and occupancy and equipment expense. Professional services increased $224 thousand or 22% for the nine months ended September 30, 2016 compared to the nine months ended September 30, 2015 as a result of an increase in fees paid in relation to strategic initiatives. Occupancy and equipment expense increased $206 thousand or 5% for the nine months ended September 30, 2016 compared to the nine months ended September 30, 2015 as a result of an increase in IT related expenses to support growth initiatives and rent expense related to the opening of the Norwalk Branch in March of 2015.

Financial Condition

Assets totaled $1.6 billion at September 30, 2016, an annualized increase of 24% compared to assets of $1.3 billion at December 31, 2015. This increase reflects strong organic loan growth. Total gross loans were $1.3 billion at September 30, 2016, an annualized increase of 21% compared to December 31, 2015. Commercial real estate loans have experienced the most significant growth, up by $119.5 million. Deposits increased to over $1.2 billion, an annualized increase of 22% over December 31, 2015.

Asset Quality

Asset quality remained exceptionally strong at September 30, 2016.  Non-performing assets as a percentage of total assets was 0.25% at September 30, 2016, down from 0.38% at December 31, 2015.  The allowance for loan losses at September 30, 2016 was $17.3 million, representing 1.30% of total loans.

Capital

Shareholders' equity totaled $140.6 million as of September 30, 2016, an increase of $8.8 million compared to December 31, 2015, primarily a result of net income for the nine months ended September 30, 2016 of $9.0 million. As of September 30, 2016, the tangible common equity ratio and tangible book value per share were 8.80% and $18.57, respectively.

About Bankwell Financial Group

Bankwell is a commercial bank that serves the banking and lending needs of residents and businesses throughout Fairfield and New Haven Counties, CT.  For more information about this press release, interested parties may contact Christopher R. Gruseke, President and Chief Executive Officer or Ernest J. Verrico Sr., Executive Vice President and Chief Financial Officer of Bankwell Financial Group at (203) 652-0166.

For more information, visit www.mybankwell.com.

This press release may contain certain forward-looking statements about the Company. Forward-looking statements include statements regarding anticipated future events and can be identified by the fact that they do not relate strictly to historical or current facts. They often 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, by their nature, are subject to risks and uncertainties. Certain factors that could cause actual results to differ materially from expected results include increased competitive pressures, changes in the interest rate environment, general economic conditions or conditions within the securities markets, and legislative and regulatory changes that could adversely affect the business in which the Company and its subsidiaries are engaged.

 

 

BANKWELL FINANCIAL GROUP, INC.
CONSOLIDATED BALANCE SHEETS (unaudited)
(Dollars in thousands, except share data)
							September 30,		June 30,		March 31,		December 31,		September 30,
							2016		2016		2016		2015		2015
Assets
Cash and due from banks							$             94,731		$             92,745		$             69,512		$             49,562		$             86,830
Federal funds sold							1,357		1,932		3,194		39,035		-
Cash and cash equivalents							96,088		94,677		72,706		88,597		86,830
Held to maturity investment securities, at amortized cost							16,909		16,959		17,010		10,226		11,282
Available for sale investment securities, at fair value							82,752		83,837		91,528		40,581		45,023
Loans held for sale							400		-		-		-		252
Loans receivable (net of allowance for loan losses of $17,250, $16,100,
$14,810, $14,169 and $13,720 at September 30, 2016, June 30, 2016,
March 31, 2016, December 31, 2015 and September 30, 2015, respectively)							1,305,065		1,256,949		1,177,905		1,129,748		1,108,439
Foreclosed real estate							272		492		878		1,248		1,328
Accrued interest receivable							4,499		4,708		4,370		4,071		3,831
Federal Home Loan Bank stock, at cost							7,943		7,393		7,158		6,554		6,918
Premises and equipment, net							10,314		10,659		10,830		11,163		11,505
Bank-owned life insurance							24,277		24,103		23,929		23,755		23,578
Goodwill							2,589		2,589		2,589		2,589		2,589
Other intangible assets							532		572		612		652		694
Deferred income taxes, net							9,874		9,487		8,814		8,337		8,604
Other assets							4,072		3,695		1,881		2,851		2,472
Total assets							$        1,565,586		$        1,516,120		$        1,420,210		$        1,330,372		$        1,313,345
Liabilities & Shareholders' Equity
Liabilities
Deposits
Noninterest-bearing							$           176,405		$           178,917		$           165,968		$           164,553		$           148,732
Interest-bearing							1,040,537		1,001,674		927,766		882,389		876,957
Total deposits							1,216,942		1,180,591		1,093,734		1,046,942		1,025,689
Advances from the Federal Home Loan Bank							175,000		165,000		160,000		120,000		120,000
Subordinated debentures							25,038		25,025		25,012		25,000		25,037
Accrued expenses and other liabilities							8,034		8,382		6,856		6,661		6,831
Total liabilities							1,425,014		1,378,998		1,285,602		1,198,603		1,177,557
Shareholders' equity
Preferred stock, senior noncumulative perpetual, Series C, no par;
10,980 shares issued and outstanding at September 30, 2015
liquidation value of $1,000 per share.							-		-		-		-		10,980
Common stock, no par value; 10,000,000 shares authorized, 7,562,508,
7,544,458, 7,530,791, 7,516,291 and 7,252,429 shares issued at September 30, 2016,
June 30, 2016, March 31, 2016, December 31, 2015 and September 30, 2015, respectively							113,650		113,309		113,052		112,579		108,319
Retained earnings							26,859		24,097		21,578		18,963		16,764
Accumulated other comprehensive income (loss)							63		(284)		(22)		227		(275)
Total shareholders' equity							140,572		137,122		134,608		131,769		135,788
Total liabilities and shareholders' equity							$        1,565,586		$        1,516,120		$        1,420,210		$        1,330,372		$        1,313,345

BANKWELL FINANCIAL GROUP, INC.
CONSOLIDATED STATEMENTS OF INCOME (unaudited)
(Dollars in thousands, except per share data)
		For the Quarter Ended										For the Nine Months Ended
		September 30,		June 30,		March 31,		December 31,		September 30,		September 30,		September 30,
		2016		2016		2016		2015		2015		2016		2015
Interest and dividend income
Interest and fees on loans		$           14,914		$         13,970		$         13,283		$          13,382		$           12,660		$           42,167		$           35,310
Interest and dividends on securities		688		711		684		490		493		2,083		1,474
Interest on cash and cash equivalents		31		30		37		36		33		98		62
Total interest income		15,633		14,711		14,004		13,908		13,186		44,348		36,846
Interest expense
Interest expense on deposits		2,160		1,962		1,740		1,776		1,637		5,862		3,905
Interest on borrowings		946		870		866		896		632		2,682		1,389
Total interest expense		3,106		2,832		2,606		2,672		2,269		8,544		5,294
Net interest income		12,527		11,879		11,398		11,236		10,917		35,804		31,552
Provision for loan losses		1,219		1,301		646		354		1,489		3,166		2,876
Net interest income after provision for loan losses		11,308		10,578		10,752		10,882		9,428		32,638		28,676
Noninterest income
Service charges and fees		241		235		245		258		234		721		675
Bank owned life insurance		174		174		174		178		182		522		549
Gains and fees from sales of loans		163		114		110		228		447		387		885
Gain on sale of foreclosed real estate, net		-		128		-		-		-		128		-
Net gain on sale of available for sale securities		-		92		-		-		-		92		-
Other		172		110		143		176		348		425		535
Total noninterest income		750		853		672		840		1,211		2,275		2,644
Noninterest expense
Salaries and employee benefits		3,909		3,817		3,811		4,248		3,798		11,537		11,817
Occupancy and equipment		1,435		1,392		1,408		1,312		1,370		4,235		4,029
Professional services		521		370		366		414		339		1,257		1,033
Data processing		417		377		407		366		416		1,201		1,157
Marketing		242		263		139		278		288		644		707
FDIC insurance		177		168		169		185		166		514		487
Director fees		128		140		155		198		136		423		424
Foreclosed real estate		47		30		72		95		81		149		73
Amortization of intangibles		39		40		40		43		51		119		153
Merger and acquisition related expenses		-		-		-		2		-		-		-
Other		566		618		513		540		513		1,697		1,610
Total noninterest expense		7,481		7,215		7,080		7,681		7,158		21,776		21,490
Income before income tax expense		4,577		4,216		4,344		4,041		3,481		13,137		9,830
Income tax expense		1,437		1,320		1,353		1,423		1,228		4,110		3,418
Net income		$             3,140		$           2,896		$           2,991		$            2,618		$             2,253		$             9,027		$             6,412
Net income attributable to common shareholders		$             3,140		$           2,896		$           2,991		$            2,575		$             2,226		$             9,027		$             6,330
Earnings Per Common Share:
Basic		$               0.42		$             0.38		$             0.40		$              0.35		$               0.31		$               1.20		$               0.88
Diluted		0.41		0.38		0.40		0.35		0.31		1.19		0.87
Weighted Average Common Shares Outstanding:
Basic		7,397,067		7,387,712		7,380,217		7,169,570		7,044,586		7,388,364		7,038,517
Diluted		7,488,752		7,467,954		7,431,747		7,234,431		7,059,117		7,459,283		7,057,450
Dividends per common share		$               0.05		$             0.05		$             0.05		$              0.05		$                   -		$               0.15		$                   -

BANKWELL FINANCIAL GROUP, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS (unaudited)
(Dollars in thousands, except per share data)
					For the Quarter Ended										For the Nine Months Ended
					September 30,		June 30,		March 31,		December 31,		September 30,		September 30,		September 30,
					2016		2016		2016		2015		2015		2016		2015
Performance ratios:
Return on average assets					0.85%		0.82%		0.89%		0.78%		0.69%		0.85%		0.74%
Return on average stockholders' equity					8.96%		8.54%		9.01%		7.68%		6.92%		8.84%		6.45%
Return on average tangible common equity					9.16%		8.74%		9.23%		7.74%		7.69%		9.04%		7.13%
Net interest margin					3.57%		3.50%		3.54%		3.63%		3.67%		3.54%		3.83%
Efficiency ratio (1)					55.7%		57.1%		57.7%		62.4%		57.9%		56.8%		62.2%
Net loan charge-offs as a % of average loans					0.01%		0.00%		0.00%		0.01%		0.00%		0.01%		0.00%
					As of
					September 30, 2016		June 30, 2016		March 31, 2016		December 31, 2015		September 30, 2015
Capital ratios:
Total Common Equity Tier 1 Capital to Risk-Weighted Assets (2)					11.64%		11.76%		12.24%		12.18%		10.75%
Total Capital to Risk-Weighted Assets (2)					12.89%		13.01%		13.48%		13.39%		11.94%
Tier I Capital to Risk-Weighted Assets (2)					11.64%		11.76%		12.24%		12.18%		10.75%
Tier I Capital to Average Assets (2)					10.45%		10.59%		10.85%		10.84%		9.84%
Tangible common equity to tangible assets					8.80%		8.85%		9.27%		9.68%		9.28%
Tangible book value per common share (3)					$               18.57		$               18.12		$               17.78		$               17.43		$               17.25
Asset quality:
Nonaccrual loans					$               3,644		$               3,609		$               3,398		$               3,791		$               2,367
Other real estate owned					272		492		878		1,248		1,328
Total non-performing assets					$               3,916		$               4,101		$               4,276		$               5,039		$               3,695
Loans past due 90 days and still accruing					$                      -		$                  105		$                    89		$               1,105		$               1,082
Nonperforming loans as a % of total loans					0.27%		0.28%		0.28%		0.33%		0.21%
Nonperforming assets as a % of total assets					0.25%		0.27%		0.30%		0.38%		0.28%
Allowance for loan losses as a % of total loans					1.30%		1.26%		1.24%		1.23%		1.22%
Allowance for loan losses as a % of nonperforming loans					473.38%		446.11%		435.84%		373.76%		579.64%

BANKWELL FINANCIAL GROUP, INC.
LOAN & DEPOSIT PORTFOLIO (unaudited)
(Dollars in thousands)
		September 30,		June 30,		December 31,		QTD		YTD
Period End Loan Composition		2016		2016		2015		% Change		% Change
Residential Real Estate		$         178,996		$         181,035		$         177,184		-1.1%		1.0%
Commercial Real Estate		817,006		785,041		697,542		4.1%		17.1%
Construction		104,915		98,266		82,273		6.8%		27.5%
Home equity		15,050		15,987		15,926		-5.9%		-5.5%
Total Real Estate Loans		1,115,967		1,080,329		972,925		3.3%		14.7%
Commercial Business		208,600		194,067		172,853		7.5%		20.7%
Consumer		1,660		2,553		1,735		-35.0%		-4.3%
Total Loans		$    1,326,227		$    1,276,949		$    1,147,513		3.9%		15.6%
		September 30,		June 30,		December 31,		QTD		YTD
Period End Deposit Composition		2016		2016		2015		% Change		% Change
Noninterest-bearing demand		$         176,405		$         178,917		$         164,553		-1.4%		7.2%
NOW		55,679		61,411		51,008		-9.3%		9.2%
Money Market		326,805		331,148		296,838		-1.3%		10.1%
Savings		63,501		65,444		97,846		-3.0%		-35.1%
Time		594,552		543,671		436,697		9.4%		36.1%
Total Deposits		$    1,216,942		$    1,180,591		$    1,046,942		3.1%		16.2%

 

BANKWELL FINANCIAL GROUP, INC.
NONINTEREST INCOME & EXPENSE - QTD (unaudited)
(Dollars in thousands)
	For the Quarter Ended
Noninterest income	September 30,		December 31,		September 30,		Sep 16 vs. Dec 15		Sep 16 vs. Sep 15
	2016		2015		2015		% Change		% Change
Service charges and fees	$               241		$               258		$               234		-6.6%		3.0%
Bank owned life insurance	174		178		182		-2.2%		-4.4%
Gains and fees from sales of loans	163		228		447		-28.5%		-63.5%
Other	172		176		348		-2.3%		-50.6%
Total noninterest income	$              750		$              840		$           1,211		-10.7%		-38.1%
	For the Quarter Ended
Noninterest expense	September 30,		December 31,		September 30,		Sep 16 vs. Dec 15		Sep 16 vs. Sep 15
	2016		2015		2015		% Change		% Change
Salaries and employee benefits	$             3,909		$             4,248		$             3,798		-8.0%		2.9%
Occupancy and equipment	1,435		1,312		1,370		9.4%		4.7%
Professional services	521		414		339		25.8%		53.7%
Data processing	417		366		416		13.9%		0.2%
Marketing	242		278		288		-12.9%		-16.0%
FDIC insurance	177		185		166		-4.3%		6.6%
Director fees	128		198		136		-35.4%		-5.9%
Foreclosed real estate	47		95		81		-50.5%		-42.0%
Amortization of intangibles	39		43		51		-9.3%		-23.5%
Merger and acquisition related expenses	-		2		-		-100.0%		0.0%
Other	566		540		513		4.8%		10.3%
Total noninterest expense	$           7,481		$           7,681		$           7,158		-2.6%		4.5%

 

BANKWELL FINANCIAL GROUP, INC.
NONINTEREST INCOME & EXPENSE - YTD (unaudited)
(Dollars in thousands)
	For the Nine Months Ended
Noninterest income	September 30,		September 30,		Sep 16 vs. Sep 15
	2016		2015		% Change
Service charges and fees	$               721		$               675		6.8%
Bank owned life insurance	522		549		-4.9%
Gains and fees from sales of loans	387		885		-56.3%
Gain on sale of foreclosed real estate, net	128		-		100.0%
Net gain on sale of available for sale securities	92		-		100.0%
Other	425		535		-20.6%
Total noninterest income	$           2,275		$           2,644		-14.0%
	For the Nine Months Ended
Noninterest expense	September 30,		September 30,		Sep 16 vs. Sep 15
	2016		2015		% Change
Salaries and employee benefits	$           11,537		$           11,817		-2.4%
Occupancy and equipment	4,235		4,029		5.1%
Professional services	1,257		1,033		21.7%
Data processing	1,201		1,157		3.8%
Marketing	644		707		-8.9%
FDIC insurance	514		487		5.5%
Director fees	423		424		-0.2%
Foreclosed real estate	149		73		104.1%
Amortization of intangibles	119		153		-22.2%
Other	1,697		1,610		5.4%
Total noninterest expense	$         21,776		$         21,490		1.3%

 

 

BANKWELL FINANCIAL GROUP, INC.
RECONCILIATION OF GAAP TO NON-GAAP MEASURES (unaudited)
(Dollars in thousands, except share data)
	As of
Computation of Tangible Common Equity to Tangible Assets	9/30/2016		06/30/2016		03/31/2016		12/31/2015		9/30/2015
Total Equity	$         140,572		$         137,122		$         134,608		$         131,769		$         135,788
Less:
Preferred stock	-		-		-		-		10,980
Goodwill	2,589		2,589		2,589		2,589		2,589
Other intangibles	532		572		612		652		694
Tangible Common Equity	$       137,451		$       133,961		$       131,407		$       128,528		$       121,525
Total Assets	$       1,565,586		$       1,516,120		$       1,420,210		$       1,330,372		$       1,313,345
Less:
Goodwill	2,589		2,589		2,589		2,589		2,589
Other intangibles	532		572		612		652		694
Tangible Assets	$    1,562,465		$    1,512,959		$    1,417,009		$    1,327,131		$    1,310,062
Tangible Common Equity to Tangible Assets	8.80	%	8.85	%	9.27	%	9.68	%	9.28	%
	As of
Computation of Tangible Book Value per Common Share	9/30/2016		06/30/2016		03/31/2016		12/31/2015		09/30/2015
Total shareholders' equity	$         140,572		$         137,122		$         134,608		$         131,769		$         135,788
Less:
Preferred stock	-		-		-		-		10,980
Common shareholders' equity	140,572		137,122		134,608		131,769		124,808
Less:
Goodwill	2,589		2,589		2,589		2,589		2,589
Other intangibles	532		572		612		652		694
Tangible common shareholders' equity	137,451		133,961		131,407		128,528		121,525
Common shares issued	7,562,508		7,544,458		7,530,791		7,516,291		7,252,429
Less:
Shares of unvested restricted stock	160,708		152,090		138,423		143,323		206,732
Common shares outstanding	7,401,800		7,392,368		7,392,368		7,372,968		7,045,697
Book value per share	$            18.99		$            18.55		$            18.21		$            17.87		$            17.71
Less:
Effects of intangible assets	$              0.42		$              0.43		$              0.43		$              0.44		$              0.47
Tangible Book Value per Common Share	$           18.57		$           18.12		$           17.78		$           17.43		$           17.25

 

 

 

BANKWELL FINANCIAL GROUP, INC.
RECONCILIATION OF GAAP TO NON-GAAP MEASURES (unaudited) - Continued
(Dollars in thousands, except share data)
	For the Quarter Ended										For the Nine Months Ended
Computation of Efficiency Ratio	09/30/2016		06/30/2016		03/31/2016		12/31/2015		09/30/2015		09/30/2016		09/30/2015
Noninterest expense	$             7,481		$             7,215		$             7,080		$             7,681		$             7,158		$           21,776		$           21,490
Less:
Amortization of intangible assets	39		40		40		43		51		119		153
Foreclosed real estate expenses	47		30		72		95		81		149		73
Merger and acquisition expense	-		-		-		2		-		-		-
Adjusted noninterest expense	$           7,395		$           7,145		$           6,968		$           7,541		$           7,026		$         21,508		$         21,264
Net interest income	$           12,527		$           11,879		$           11,398		$           11,236		$           10,917		$           35,804		$           31,552
Noninterest income	750		853		672		840		1,211		2,275		2,644
Less:
Gains (losses) on sales of securities	-		92		-		-		-		92		-
Gains on sale of foreclosed real estate	-		128		-		-		-		128		-
Adjusted operating revenue	$         13,277		$         12,512		$         12,070		$         12,076		$         12,128		$         37,859		$         34,196
Efficiency ratio	55.7	%	57.1	%	57.7	%	62.4	%	57.9	%	56.8	%	62.2	%
	For the Quarter Ended										For the Nine Months Ended
Computation of Return on Average Tangible Common Equity	09/30/2016		06/30/2016		03/31/2016		12/31/2015		09/30/2015		09/30/2016		09/30/2015
Net Income Attributable to Common Shareholders	$             3,140		$             2,896		$             2,991		$             2,575		$             2,226		$             9,027		$             6,330
Total average shareholders' equity	139,449		136,389		133,474		135,311		129,097		136,445		132,974
Less:
Preferred stock	-		-		-		-		10,980		-		10,980
Goodwill	2,589		2,589		2,589		2,589		2,589		2,589		2,589
Other intangibles	532		572		612		652		694		532		694
Average tangible common equity	136,328		133,228		130,273		132,070		114,834		133,324		118,711
Annualized Return on Average Tangible Common Equity	9.16	%	8.74	%	9.23	%	7.74	%	7.69	%	9.04	%	7.13	%

 

 

BANKWELL FINANCIAL GROUP, INC.
NET INTEREST MARGIN ANALYSIS ON A FULLY TAX EQUIVALENT BASIS
(Dollars in thousands)
		For the Quarter Ended
		September 30, 2016						September 30, 2015
		Average				Yield/		Average				Yield/
		Balance		Interest		Rate		Balance		Interest		Rate
Assets:
Cash and Fed funds sold		$          28,305		$             29		0.41%		$        62,597		$             33		0.21%
Securities (1)		98,480		762		3.09%		57,234		549		3.84%
Loans:
Commercial real estate		788,429		9,305		4.62%		645,488		7,873		4.77%
Residential real estate		178,106		1,600		3.59%		175,908		1,569		3.57%
Construction (2)		107,197		1,230		4.49%		79,722		912		4.48%
Commercial business		195,881		2,584		5.16%		157,867		2,075		5.14%
Home equity		14,706		156		4.23%		16,422		155		3.75%
Consumer		1,467		20		5.51%		2,184		27		4.87%
Acquired loans (net of mark)		482		19		15.60%		2,558		51		7.91%
Total loans		1,286,268		14,914		4.54%		1,080,149		12,662		4.59%
Federal Home Loan Bank stock		7,400		65		3.51%		6,918		47		2.71%
Total earning assets		1,420,453		$      15,770		4.34%		1,206,898		$      13,291		4.31%
Other assets		56,762						89,978
Total assets		$     1,477,215						$   1,296,876
Liabilities and shareholders' equity:
Interest-bearing liabilities:
NOW		$          53,515		16		0.12%		$        56,104		15		0.11%
Money market		330,263		484		0.58%		293,150		408		0.55%
Savings		62,689		64		0.40%		103,555		214		0.82%
Time		540,823		1,597		1.17%		401,968		1,005		0.99%
Total interest-bearing deposits		987,290		2,161		0.87%		854,777		1,642		0.76%
Borrowed Money		171,385		946		2.20%		118,391		583		1.95%
Total interest-bearing liabilities		1,158,675		$        3,107		1.07%		973,168		$        2,225		0.91%
Noninterest-bearing deposits		170,500						161,354
Other liabilities		8,591						33,257
Total liabilities		1,337,766						1,167,779
Shareholders' equity		139,449						129,097
Total liabilities and shareholders'  equity		$     1,477,215						$   1,296,876
Net interest income (3)				$      12,663						$      11,066
Interest rate spread						3.27%						3.40%
Net interest margin (4)						3.57%						3.67%

 

BANKWELL FINANCIAL GROUP, INC.
NET INTEREST MARGIN ANALYSIS ON A FULLY TAX EQUIVALENT BASIS
(Dollars in thousands)
		For the Nine Months Ended
		September 30, 2016						September 30, 2015
		Average				Yield/		Average				Yield/
		Balance		Interest		Rate		Balance		Interest		Rate
Assets:
Cash and Fed funds sold		$          30,559		$             94		0.41%		$        37,037		$             61		0.22%
Securities (1)		102,107		2,321		3.03%		61,233		1,699		3.70%
Loans:
Commercial real estate		754,163		26,385		4.60%		583,024		21,476		4.86%
Residential real estate		178,699		4,807		3.59%		174,389		4,727		3.61%
Construction (2)		96,635		3,298		4.48%		71,900		2,509		4.60%
Commercial business		178,453		7,082		5.21%		151,017		5,866		5.12%
Home equity		15,206		468		4.11%		17,551		494		3.77%
Consumer		1,707		66		5.14%		2,487		90		4.85%
Acquired loans (net of mark)		863		61		9.46%		2,877		155		7.22%
Total loans		1,225,726		42,167		4.52%		1,003,245		35,317		4.64%
Federal Home Loan Bank stock		7,173		184		3.43%		6,741		110		2.17%
Total earning assets		1,365,565		$      44,766		4.31%		1,108,256		$      37,187		4.42%
Other assets		55,145						57,388
Total assets		$     1,420,710						$   1,165,644
Liabilities and shareholders' equity:
Interest-bearing liabilities:
NOW		$          55,742		87		0.21%		$        57,017		48		0.11%
Money market		319,289		1,331		0.56%		253,662		1,007		0.53%
Savings		71,243		215		0.40%		95,242		492		0.69%
Time		502,177		4,230		1.13%		341,658		2,358		0.92%
Total interest-bearing deposits		948,451		5,863		0.83%		747,579		3,905		0.70%
Borrowed Money		158,247		2,682		2.26%		124,129		1,389		1.50%
Total interest-bearing liabilities		1,106,698		$        8,545		1.03%		871,708		$        5,294		0.81%
Noninterest-bearing deposits		170,088						154,825
Other liabilities		7,479						6,137
Total liabilities		1,284,265						1,032,670
Shareholders' equity		136,445						132,974
Total liabilities and shareholders'  equity		$     1,420,710						$   1,165,644
Net interest income (3)				$      36,221						$      31,893
Interest rate spread						3.28%						3.61%
Net interest margin (4)						3.54%						3.83%

 

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